ML23244A247
| ML23244A247 | |
| Person / Time | |
|---|---|
| Site: | Vallecitos Nuclear Center, 07000754, Vallecitos |
| Issue date: | 09/01/2023 |
| From: | State S, Wileman J GE-Hitachi Nuclear Energy Americas, NorthStar Group Services, NorthStar Vallecitos |
| To: | Office of Nuclear Material Safety and Safeguards, Office of Nuclear Reactor Regulation, Document Control Desk |
| Shared Package | |
| ML23244A245 | List: |
| References | |
| m230119 | |
| Download: ML23244A247 (203) | |
Text
{{#Wiki_filter:- HITACHI NorthStar Proprietary Information Notice Appendix A, sections A.3.1.1 and A.3.1.2, and Exhibits G and J to the enclosure to this letter contain GEHA and/or NorthStar Group Services, Inc. proprietary information which is to be withheld from public disclosure in accordance with 10 CFR 2.390. Upon redaction of the bracketed proprietary information in Appendix A and removal ofExhibits and J, the balance of this letter may be made public. September 1, 2023 M230119 Via Electronic Information Exchange ATTN: Document Control Desk 10 CFR 50.80 U.S. Nuclear Regulatory Commission 10 CFR 50.90 One White Flint North 10 CFR 70.34 115 5 5 Rockville Pike 10 CFR 70.36 Rockville, MD 20852 10 CFR 2.390 Nuclear Test Reactor (NTR) License No. R-33 NRC Docket No. 50-73 Vallecitos Boiling Water Reactor (VBWR) License No. DPR-1 NRC Docket No. 50-18 ESADA Vallecitos Experimental Superheat Reactor (EVESR) License No. DR-10 NRC Docket No. 50-183 General Electric Test Reactor (GETR) License No. TR-I NRC Docket No. 50-70 Vallecitos Nuclear Center License No. SNM-960 NRC Docket No. 70-754 1
Re: Application for Consent to Direct Transfers of Control of Licenses and Related Conforming License Amendments Pursuant to Section 184 of the Atomic Energy Act of 1954, as amended ("AEA"), and 10 CFR 50.80 and 70.36, GE-Hitachi Nuclear Energy Americas, LLC ("GEHA") and NorthStar Vallecitos, LLC ("NorthStar Vallecitos") (together, "Applicants") respectfully request that the U.S. Nuclear Regulatory Commission ("NRC") consent to the direct transfers of control of GEHA's licensed interests in: (1) Facility Possession-Only License No. TR-1 for the General Electric Test Reactor ("GETR"), (2) Facility Possession-Only License No. DR-10 for the ESADA Vallecitos Experimental Superheat Reactor ("EVESR"), (3) Facility Possession-Only License No. DPR-1 for the Vallecitos Boiling Water Reactor ("VBWR"), (4) Facility License No. R-33 for the Nuclear Test Reactor ("NTR"), and (5) Materials License No. SNM-960 (collectively, the "Licenses") for the Vallecitos Nuclear Center in Sunol, CA. In addition, pursuant to 10 CFR 50.90 and 70.34, the Applicants request that the NRC: (1) approve conforming administrative amendments to reflect the direct transfers of the Licenses from GEHA to NorthStar Vallecitos; and (2) impose additional license conditions relating to the nuclear decommissioning fund ("NDF") that will provide decommissioning financial assurance for the Licenses. The requested license conditions will impose certain obligations applicable to decommissioning trust funds maintained by power reactor licensees which would otherwise be inapplicable given that the Licenses are for research and test reactors and the possession of special nuclear material. Applicants request that the NRC issue its consent to the transfers of the Licenses by no later than March 1, 2024. Applicants seek NRC consent to the transfers of the Licenses in connection with a proposed transaction, described more fully below and in the enclosure to this letter, pursuant to which the ownership of and licensed responsibility for the Vallecitos Nuclear Center would be transferred to NorthStar Vallecitos for prompt nuclear decontamination, decommissioning, and remediation and removal of all hazardous substances from the site as required by applicable law (the "Transaction"). 1 As part of the Transaction, GEHA will transfer ownership of and licensed responsibility for the Vallecitos Nuclear Center to NorthStar Vallecitos; and General Electric Company ("GE") will transfer ownership of the real estate underlying the Vallecitos Nuclear Center to NorthStar Vallecitos. Additional information supporting this request for NRC consent is provided in the enclosed "Application for Consent to Direct Transfers of Control of Licenses and Related Conforming License Amendments" (the "Application"), which is provided as Enclosure 1. This information is provided for the purpose of demonstrating: (1) the proposed transfers of the Licenses to NorthStar Vallecitos will result in the timely decommissioning of the licensed facilities at the Vallecitos Nuclear Center in a safe and compliant manner; (2) NorthStar Vallecitos has the requisite The closing of the Transaction described in the enclosed Application is subject to the satisfaction of all closing conditions in the Asset Purchase and Sale Agreement, dated May 8, 2023 ("APSA"), by and among GEHA, GE, and NorthStar Vallecitos, including that License No. R-33 will be a possession-only license at the time of transfer. GEHA plans to submit a License Amendment Request ("LAR") for the NTR and expects to permanently cease operations before the end of 2023. Applicants are requesting a condition in the NRC's order granting consent that the Transaction may not close before License No. R-33 becomes possession-only. 2
managerial, technical, and financial qualifications to be the license-holder of the Licenses for purposes of decommissioning; (3) NorthStar Vallecitos will provide reasonable assurance of adequate funding to maintain and decommission the Vallecitos Nuclear Center facilities ; and (4) the proposed transfers of the Licenses to NorthStar Vallecitos will not result in any impermissible foreign ownership, control or domination. GE holds 60% of the ownership interests in GEHA through wholly-owned intermediate holding companies. The remaining 40% of GEHA is ultimately held by Hitachi Ltd., a Japanese corporation, through wholly-owned intermediate holding companies. The current ownership structure of GEHA is depicted in a simplified organization chart provided in Exhibit D-1 to the enclosed Application. Exhibit D-2 provides a simplified organization chart showing the planned ownership structure ofNorthStar Vallecitos following the closing of the Transaction. Following the closing of the Transaction, which is conditioned upon the receipt ofNRC consent to the transfers of the Licenses and satisfaction of certain other conditions, NorthStar Vallecitos will be the license-holder authorized to conduct licensed activities and to possess the nuclear material at the Vallecitos Nuclear Center. NorthStar Vallecitos will also hold title to the real estate and facilities encompassed within the Vallecitos Nuclear Center. NorthStar Vallecitos will also acquire all of the rights and obligations with respect to the NDF that will be established under the terms of the Transaction, as described in the enclosed Application. Finally, NorthStar Vallecitos will acquire all of GE's and GEHA' s title to and interests in any spent nuclear fuel and high-level radioactive waste located at the Vallecitos Nuclear Center, including all rights and obligations pursuant to the terms of GEHA 's Standard Contract for Disposal of Spent Nuclear Fuel and/or High-Level Radioactive Waste with the U.S. Department of Energy ("DOE") and those agreements between GE or GEHA and other titleholders of spent nuclear fuel or high-level radioactive waste stored at the Vallecitos Nuclear Center. NorthStar Vallecitos' licensed activities will include, but not be limited to, possessing nuclear material, maintaining the Vallecitos Nuclear Center in a safe condition (including storage, control, and maintenance of all nuclear material), decommissioning and decontaminating ("D&D") of the Vallecitos Nuclear Center (including processing all nuclear material at the site for offsite disposal at an appropriate facility), and providing appropriate protection for the site until all nuclear material located at the site is removed and decommissioning is completed, each in accordance with the Licenses and all applicable NRC regulations and orders. NorthStar Vallecitos anticipates submitting a combined site post-shutdown decommissioning act1v1t1es report ("PSDAR")/decommissioning plan ("DP") for all facilities and the Licenses to include integrated project cost detail and decommissioning schedule. Applicants' Transaction is desirable and of considerable benefit to the citizens of California as it is expected to accelerate the decommissioning of the Vallecitos Nuclear Center, including the removal of radioactive material, and release of all portions of the site as promptly as reasonably practicable. NorthStar Vallecitos will leverage the substantial experience and expertise of its parent, NorthStar Group Services, Inc., and certain other subsidiaries and affiliates of NorthStar Group Services, Inc. (collectively, "NorthStar Group"), in decommissioning and spent nuclear fuel management. 3
NorthStar Vallecitos plans to complete radiological decommissioning and decontamination of all portions of the Vallecitos Nuclear Center by the end of 2030, with the exception of the Hillside Storage Facility, the specially designed facility licensed to store special nuclear material at the site, which will be decommissioned as promptly as reasonably practicable after removal by the U.S. Department of Energy ("DOE") of the spent nuclear fuel and high-level radioactive waste located at the site. Under the terms of the Asset Purchase and Sale Agreement, dated May 8, 2023 ("APSA"), by and among GE, GEHA and NorthStar Vallecitos governing the Transaction, GE will establish an NDF and make an initial deposit of funds. Prior to the closing of the Transaction, GE will assign the NDF to GEHA, (either directly or via a series of assignments or contributions through affiliates of GE or GEHA). GEHA will then transfer the NDF to NorthStar Vallecitos at or upon the closing of the Transaction. NorthStar Vallecitos intends to rely upon the NDF to provide for decommissioning financial assurance for the Licenses as well as the byproduct radioactive materials license issued by the California Department of Public Health, License No. CA 0017-01 (the "CDPH License"). NorthStar Vallecitos expects that the funds in the NDF, as of the closing of the Transaction, will be sufficient to pay all of the expected costs of decommissioning the Vallecitos Nuclear Center, including possessing and securing nuclear material at the site. In addition, NorthStar Vallecitos has agreed to provide additional financial support, if necessary, to ensure the completion of decommissioning. Applicants provide more detailed information in the enclosed Application regarding the basis for concluding that there is sufficient decommissioning funding and spent nuclear fuel management funding assurance. The closing of the Transaction is conditioned on the receipt of certain regulatory approvals beyond that of the NRC, each of which must be obtained prior to the closing of the Transaction, including the approval of the California Department of Public Health for the transfer of the CDPH License. Applicants will keep the NRC informed of any significant changes in the status of other required approvals or developments that could have an impact on the Transaction closing date. The Applicants respectfully request that the NRC act expeditiously on the enclosed Application and grant its consent to the transfers of the Licenses by no later than March 1, 2024. We are prepared to work closely with the NRC Staff to facilitate the review of the Application. GEHA will notify the NRC staff at least five (5) business days prior to the expected closing date for the Transaction. In summary, the proposed transfers of the Licenses will not be inimical to the common defense and security or result in any undue risk to public health and safety, and the transfers will be implemented consistent with the requirements of the AEA and the NRC regulations. Should there be questions regarding the Application, the Licenses, or the parties to the Transaction, please contact Michelle P. Catts, Senior Vice President of GEHA Regulatory Affairs at Michelle.Catts@GE.com or Gregory G. DiCarlo, Vice President and General Counsel of NorthStar Group Services, Inc., at gdicarlo@NorthStar.com. 4
The individual signatories below and to the enclosed Affirmation are only certifying to the information included in this letter and the enclosed Application about their respective companies. Sincerely, Jay Tf
- eman President & Chief Executive Officer GE-Hitachi Nuclear Energy Americas, LLC For the NorthStar Companies:
Scott E. State Chief Executive Officer NorthStar Group Services, Inc. Enclosures cc: Administrator, USNRC Region IV Director, Office of Nuclear Materials Safety and Safeguards Director, Office of Nuclear Reactor Regulations Executive Director for Operations Radioactive Materials Licensing Section, Radiologic Health Branch, California Department of Public Health 5
The individual signatories below and to the enclosed Affirmation are only certifying to the information included in this letter and the enclosed Application about their respective companies. Sincerely, For GE-Hitachi Nuclear Energy Americas, LLC Jay T. Wileman President & Chief Executive Officer GE-Hitachi Nuclear Energy Americas, LLC Fs!iOk Scott E. State Chief Executive Officer NorthStar Group Services, Inc. Enclosures cc: Administrator, USNRC Region IV Director, Office of Nuclear Materials Safety and Safeguards Director, Office of Nuclear Reactor Regulations Executive Director for Operations Radioactive Materials Licensing Section, Radiologic Health Branch, California Department of Public Health 5
Applicants also would appreciate the NRC adding the individuals on the below list to the service list for correspondence related to the Application. ADDITIONS TO SERVICE LIST Timothy P. Matthews Grant W. Eskelsen Morgan, Lewis & Bockius LLP 1111 Pennsylvania Ave. , NW Washington, D.C. 20004 Telephone: (202) 739-3000 Email: tirnothy.rnatthews@rnorganlewis.com Email: grant.eskelsen@rnorganlewis.com Christine Jarmer General Electric Company 11330 Clay Road Houston, TX 77041 Telephone: (281) 224-5701 Email: christine.jarrner@ge.com Michael G. Lepre Anne Leidich Pillsbury Winthrop Shaw Pittman LLP 1200 17th St NW, Washington, DC 20036 Telephone: (202) 663-8193 Email: rnichael.lepre@pillsburylaw. corn Email: anne.leidich@pillsburylaw. corn Gregory G. DiCarlo NorthStar Vallecitos, LLC Seven Penn Plaza 370 7th Avenue, Suite 1803 New York, NY 10001 Telephone: (203) 222-0584 Email: gdicarlo@N orthS tar. corn 6
ENCLOSURE 1 APPLICATION FOR CONSENT TO DIRECT TRANSFERS OF CONTROL OF LICENSES AND RELATED CONFORMING LICENSE AMENDMENTS
TABLE OF CONTENTS
1.0 INTRODUCTION
.............................................................................................................. 1 1.1 TIMING ........................................... .. ........................................ .. ...... .. ....... .. ....... 5 2.0 THEPARTIES ................................................................................................................... 5 2.1 GE-HITACHI NUCLEAR ENERGY AMERICAS LLC ................................... 5 2.2 NORTHSTAR VALLECITOS, LLC .................................................................. 6 3.0 LICENSES ......................................................................................................................... 8
4.0 CONCLUSION
......................................................................................................... ......... 8 APPENDIX A ADDITIONAL INFORMATION NEEDED BY THE NRC FOR CONSENT TO THE DIRECT TRANSFERS OF CONTROL OF THE REACTOR LICENSES FOR THE V ALLECITOS NUCLEAR CENTER AND AS SOCIATED LICENSE AMENDMENTS ................................................................ A-1 A.I STATEMENT OF PURPOSE OF THE TRANSFER .................................... A-1 A.2 TECHNICAL QUALIFICATIONS ............... .... ............................................. A-2 A.3 FINANCIAL QUALIFICATIONS ................................................................. A-6 A.4 FOREIGN OWNERSHIP, CONTROL, OR DOMINATION ...................... A-12 A.5 ACCESS TO RESTRICTED DATA AND NATIONAL SECURITY INFORMATION ........................................................................................... A-13 A.6 ENVIRONMENTAL CONSIDERATIONS ................................................. A-13 A.7 PRICE-ANDERSON INDEMNITY AND NUCLEAR INSURANCE ........ A-14 A.8 CONFORMING AMENDMENTS AND LICENSE CONDITIONS .......... A-14 APPENDIX A ADDITIONAL INFORMATION NEEDED BY THE NRC FOR CONSENT TO THE DIRECT TRANSFERS OF CONTROL OF THE REACTOR LICENSES FOR THE V ALLECITOS NUCLEAR CENTER AND ASSOCIATED LICENSE AMENDMENTS (REDACTED) ........................................ A-16 A.I STATEMENT OF PURPOSE OF THE TRANSFER ................................... A-16 A.2 TECHNICAL QUALIFICATIONS ................................................................ A-17 A.3 FINANCIAL QUALIFICATIONS ................................................................. A-21 A.4 FOREIGN OWNERSHIP, CONTROL, OR DOMINATION ...................... A-27 A.5 ACCESS TO RESTRICTED DATA AND NATIONAL SECURITY INFORMATION ... ........ ........ ...... ............ ...... ...... ............ ...... ...... ............ ...... A-28 A.6 ENVIRONMENTAL CONSIDERATIONS ................................................. A-28 A.7 PRICE-ANDERSON INDEMNITY AND NUCLEAR INSURANCE ........ A-29 A.8 CONFORMING AMENDMENTS AND LICENSE CONDITIONS .......... A-29 TABLE OF CONTENTS APPENDIX B ADDITIONAL INFORMATION NEEDED BY THE NRC FOR CONSENT TO THE DIRECT TRANSFER OF CONTROL OF THE MATERIALS LICENSE FOR THE V ALLECITOS NUCLEAR CENTER AND AS SOCIATED LICENSE AMENDMENTS ................................................................ B-1 B.1 DESCRIPTION OF THE TRANSACTION ................................................... B-1 B.2 CHANGES IN PERSONNEL OR DUTIES ................................................... B-4 B.3 CHANGES IN LOCATION, FACILITIES, OR EQUIPMENT. .................... B-4 B.4 CHANGES IN STATUS OF FACILITIES, EQUIPMENT, AND RADIATION SAFETY PROGRAM .............................................................. B-5 B.5 DECOMMISSIONING FUNDING ................................................................ B-6 B.6 DECOMMISSIONING FUNDING RECORDS ............................................. B-7 B. 7 CONFORMING AMENDMENTS AND LICENSE CONDITIONS ............ B-7 B.8 TRANSFEROR AND TRANSFEREE AGREE TO TRANSFERRING CONTROL ...................................................................................................... B-8 B.9 TRANSFEREE'S COMMITMENT TO ABIDE BY ALL CONSTRAINTS, CONDITIONS, REQUIREMENTS, AND COMMITMENTS ........................................................................................... B-8 Exhibits A Applications and Affidavits for Withholding of Proprietary Information B General Company Information for GE-Hitachi Nuclear Energy Americas, LLC C General Company Information for NorthStar Vallecitos, LLC D-1 Simplified Organization Chart Before the Transfer D-2 Simplified Organization Chart After the Transfer E Project Management Organization F Resumes G Asset Purchase and Sale Agreement (proprietary)
H Asset Purchase and Sale Agreement (redacted) I Form of Nuclear Decommissioning Fund Trust Agreement J Consolidated Financial Assurance Instruments (proprietary) K Consolidated Financial Assurance Instruments (redacted) L-1 Conforming Amendments and License Conditions for Each License (Mark-up) L-2 Conforming Amendments and License Conditions for Each License (Clean)
1.0 INTRODUCTION
Pursuant to Section 184 of the Atomic Energy Act of 1954, as amended ("AEA"), and the implementing regulations in 10 CFR 50.80 and 70.36, and consistent with the implementing guidance inNUREG-1556, Vol. 15, Rev. 1, 1 NUREG-1577, Rev. 1, 2 and Regulatory Guide 1.159, Rev. 2, 3 GE-Hitachi Nuclear Energy Americas, LLC ("GEHA"), a Delaware limited liability company, and NorthStar Vallecitos, LLC ("NorthStar Vallecitos"), a Delaware limited liability company, (together, "Applicants"), respectfully request that the U.S. Nuclear Regulatory Commission ("NRC) consent to the direct transfers of control of GEHA's licensed interests in: (1) Facility Possession-Only License No. TR-I for the General Electric Test Reactor ("GETR"), (2) Facility Possession-Only License No. DR-10 for the ESADA Vallecitos Experimental Superheat Reactor ("EVE SR"), (3) Facility Possession-Only License No. DPR-1 for the Vallecitos Boiling Water Reactor ("VBWR"), (4) Facility License No. R-33 for the Nuclear Test Reactor ("NTR"), and (5) Materials License No. SNM-960 (collectively, the "Licenses") for the Vallecitos Nuclear Center in Sunol, CA. 4 SNM-960 generally authorizes the storage of special nuclear material at the site, including in the Hillside Storage Facility, the specially designed facility licensed for storage of special nuclear material at the site. NUREG-1556, Volume 15, Rev. 1, Consolidated Guidance About Materials Licenses: Guidance About Changes of Control and About Bankruptcy Involving Byproduct, Source, or Special Nuclear Materials Licenses (June 2016) (ML16181A003). NUREG-1577, Rev. 1, Standard Review Plan on Power Reactor Licensee Financial Qualifications and Decommissioning Funding Assurance (Mar. 1999) (MLl 7033B536). Regulatory Guide 1.159, Rev. 2, Assuring The Availability Of Funds For Decommissioning Nuclear Reactors (Oct. 2011) (MLl 12160012). 4 Materials License No. SNM-1270 was originally associated with the Vallecitos Nuclear Center, as it listed a mailing address at the site. However, on July 23, 2023, the NRC renewed SNM-1270, including revising, at GEHA's request, the mailing address to be applicable to its Wilmington, NC facility; accordingly, License No. SNM-1270 will not be transferred to NorthStar Vallecitos. 1
In addition, pursuant to 10 CFR 50.90 and 70.34, the Applicants request that the NRC: (1) approve conforming administrative amendments to reflect the direct transfers of the Licenses from GEHA to NorthStar Vallecitos; and (2) impose additional license conditions relating to the nuclear decommissioning fund ("NDF") that will provide decommissioning financial assurance for the Licenses once transferred to NorthStar Vallecitos. The requested license conditions will impose certain obligations applicable to decommissioning trust funds maintained by power reactor licensees which would otherwise be inapplicable given that the Licenses are for research and test reactors and the possession of special nuclear material. Applicants respectfully request that the NRC issue its consent to the transfers of the Licenses by no later than March 1, 2024. Applicants seek NRC consent to the transfers of the Licenses in connection with a proposed transaction, described more fully below and in the appendices and exhibits to this Application, pursuant to which the ownership of and licensed responsibility for the Vallecitos Nuclear Center would be transferred to NorthStar Vallecitos for prompt nuclear decontamination, decommissioning, and remediation and removal of all hazardous substances from the site as required by applicable law (the "Transaction"). 5 As part of the Transaction, GEHA will transfer ownership of and licensed responsibility for the Vallecitos Nuclear Center to NorthStar Vallecitos; and General Electric Company ("GE") will transfer ownership of the real estate underlying the Vallecitos Nuclear Center to NorthStar Vallecitos. The closing of the Transaction is subject to the satisfaction of all closing conditions in the Asset Purchase and Sale Agreement dated May 8, 2023, by and among GEHA, GE, and NorthStar Vallecitos, including that License No. R-33 will be a possession-only license at the time of transfer. GEHA plans to submit a License Amendment Request ("LAR") for the NTR and expects to permanently cease operations before the end of 2023. Applicants are requesting a condition in the NRC's order granting consent that the Transaction may not close before License No. R-33 becomes possession-only. 2
GE holds 60% of the ownership interests in GEHA through wholly-owned intermediate holding compames. The remaining 40% of GEHA is ultimately held by Hitachi Ltd. , a Japanese corporation, through wholly-owned intermediate holding companies. The current ownership structure of GEHA is depicted in a simplified organization chart provided in Exhibit D-1. Exhibit D-2 provides a simplified organization chart showing the planned ownership structure of NorthStar Vallecitos following the closing of the Transaction. Following the closing of the Transaction, which is conditioned upon the receipt ofNRC consent to the transfers of the Licenses and satisfaction of certain other conditions, NorthStar Vallecitos will be the license-holder authorized to conduct licensed activities and to possess the nuclear materials at the Vallecitos Nuclear Center. NorthStar Vallecitos will hold title to the real estate and facilities encompassed within the Vallecitos Nuclear Center. NorthStar Vallecitos will also acquire all of the rights and obligations with respect to the NDF that will be established under the terms of the Transaction, as described in this Application. Finally, NorthStar Vallecitos will acquire all of GE ' s and GEHA' s title to and interests in any spent nuclear fuel and high-level radioactive waste located at the Vallecitos Nuclear Center, including all rights and obligations pursuant to the terms of GEHA's Standard Contract for Disposal of Spent Nuclear Fuel and/or High-Level Radioactive Waste ("Standard Contract") with the U.S. Department of Energy ("DOE") and those agreements between GE or GEHA and other titleholders of spent nuclear fuel or high-level radioactive waste stored at the Vallecitos Nuclear Center. NorthStar Vallecitos ' licensed activities will include, but not be limited to, possessing nuclear material, maintaining the Vallecitos Nuclear Center in a safe condition (including storage, control, and maintenance of all nuclear material), decommissioning and decontaminating the Vallecitos Nuclear Center (including processing all nuclear material at the site for offsite disposal at an 3
appropriate facility), and providing appropriate protection for the site until all nuclear material at the site is removed and decommissioning is completed, each in accordance with the Licenses and all applicable NRC regulations and orders. Further, under the terms of the Asset Purchase and Sale Agreement, dated May 8, 2023 ("APSA"), by and among GE, GEHA and NorthStar Vallecitos governing the Transaction, GE will establish an NDF and make an initial deposit of funds. Prior to the closing of the Transaction, GE will assign the NDF (either directly or via a series of assignments or contributions through affiliates of GE or GEHA) to GEHA. GEHA will then transfer the NDF to NorthStar Vallecitos at or upon the closing of the Transaction. The amount of funds in the NDF that will transfer to NorthStar Vallecitos may be adjusted downward to reflect the costs for decommissioning work performed by or at the direction of GEHA prior to transfer to NorthStar Vallecitos. NorthStar Vallecitos intends to rely upon the amounts in the NDF to provide for decommissioning financial assurance for the Licenses as well as the byproduct radioactive materials license issued by the California Department of Public Health, License No. CA 0017-01 (the "CDPH License"). 6 NorthStar Vallecitos expects that the funds in the NDF, as of the closing of the Transaction, will be sufficient to pay all of the expected costs of decommissioning the Vallecitos Nuclear Center, including possessing and securing the nuclear material at the site. In addition, NorthStar Vallecitos has agreed to provide additional financial support, if necessary, to ensure the completion of decommissioning. 6 GEHA, Site-Specific Dec01mnissioning Cost Estimate and Deconnnissioning Funding Plan for the GE Test Reactor (GETR), License TR-1 , Docket 50-70, Rev. 0 (Mar. 6, 2020) (non-public); GEHA, Deconnnissioning Funding Plan NRC Material License, License SNM-960, Docket 70-754, Rev. 5 (Mar. 30, 2022) (ML22089A087); GEHA, GNF-A/GEH Financial Assurance ofDeconnnissioning Funds - Surety Bond Riders (Mar 31 , 2023) (ML23104A417); GEHA, Deconnnissioning Funding Plan, California Radiologic Health Branch, License No. CA 0017-01 , Rev. 5 (March 24, 2023). 4
The Transaction is governed by the APSA, a copy of which is provided as Exhibit G to this Application. Exhibit G contains confidential commercial and financial information and Applicants request that this information be withheld from public disclosure pursuant to 10 CFR 2.390. A copy of the APSA suitable for public disclosure is included as Exhibit H; it has been redacted to remove proprietary information. An affidavit requesting withholding of the unredacted version is provided in Exhibit A. 1.1 TIMING In addition to the consents requested in the Application, the closing of the Transaction is conditioned, among other things, on receipt of relevant approvals, licenses, or consents from applicable governmental authorities in the state of California. Accordingly, the Applicants respectfully request that the NRC review the Application on a schedule that will permit the issuance of an order consenting to the transfer of the Licenses and approval of conforming license amendments and conditions as promptly as possible and by no later than March 1, 2024. Applicants will notify the NRC staff at least five ( 5) business days prior to the expected closing date for the Transaction. 2.0 THE PARTIES 2.1 GE-HITACHI NUCLEAR ENERGY AMERICAS LLC GEHA, a Delaware limited liability company, is a joint venture between GE and Hitachi Ltd. ("Hitachi"), a Japanese corporation. GE holds 60% of the ownership interests in GEHA through 5
wholly-owned intermediate holding companies. 7 The remaining 40% of GEHA is ultimately held by Hitachi through wholly-owned intermediate holding companies. GEHA holds the Licenses. 8 GE is a high-tech industrial company. GE's products include commercial and military aircraft engines and systems, wind and other renewable energy generation equipment and grid solutions, and gas, steam, nuclear, and other power generation equipment. GE has significant global installed bases of equipment across these sectors, and services to support these products are also an important part of its business alongside new equipment sales. Specific to this Application, GE's nuclear power business (through its joint venture with Hitachi) designs and sells (or licenses) nuclear technologies such as reactor designs, supplies nuclear fuel, and provides other equipment and services to the nuclear industry. The general company information for GEHA is provided in Exhibit B. A simplified organization chart showing the ownership structure of GEHA is provided in Exhibit D-1. 2.2 NORTHSTAR VALLECITOS, LLC NorthStar Vallecitos, a Delaware limited liability company, is a newly formed, wholly owned subsidiary of NorthStar Group Services, Inc., a Delaware corporation, collectively known as NorthStar Group along with certain other subsidiaries and affiliates ofNorthStar Group Services, On June 1, 2023, GE submitted a request to the NRC for consent to an indirect transfer of control of GEHA. If that transfer closes prior to the transfer of ownership of the Vallecitos Nuclear Center, the parties expect to supplement this Application to reflect the new ultimate parent of GEHA. The NRC approved the transfer of certain NRC licenses held by GE to GEHA on September 6, 2007. See Letter to D. Turner, GE, and H. Neems, GEHA from M. Mendonca, NRC, Order Approving Transfer of Licenses and Conforming Amendments Relating to the Vallecitos Boiling Water Reactor, the General Electric Test Reactor, the Nuclear Test Reactor, and the ESADA Vallecitos Experimental Superheat Reactor (Sept. 6, 2007) (ML071450156) (Letter), (ML071450174) (Order) (ML071500624) (Safety Evaluation); Letter to D. Turner, GEHA, from M. Tschiltz, NRC, "Order Approving Transfer of License Nos. SNM-960 and SNM-1270 from General Electric Company to GE-Hitachi Nuclear Energy Americas LLC (Sept. 26, 2007) (ML071420199) (Letter) (ML071420249) (Order) (ML071420279) (Safety Evaluation). 6
Inc. NorthStar Group is an industry leader in decommissioning large-scale industrial and commercial complexes, with experience in decommissioning nuclear facilities in the U.S. and abroad. As the owner, program manager, and demolition and abatement contractor, NorthStar Group brings over 30 years of experience to the decontamination and decommissioning ("D&D") effort, including successfully completing decommissioning of four research reactors at the Universities of Buffalo, Arizona, Illinois, and Washington. In addition, NorthStar Group has been involved with decommissioning of DOE's facilities at Hanford and Savannah River, supporting the deconstruction of nuclear reactor laboratory facilities at several universities, and have been awarded a contract to support the decommissioning of 10 reactor sites in the UK. A subsidiary of NorthStar Group Services, Inc., and an affiliate of NorthStar Vallecitos, is part of a joint venture that is actively decommissioning the Crystal River Unit 3 Nuclear Generating Plant in Citrus County, Florida, following NRC and state regulatory consent to the transfer of those licenses in 2020. A separate affiliate ofNorthStar Vallecitos is the licensee responsible for decommissioning the former Vermont Yankee Nuclear Power Station ("Vermont Yankee") in Vernon, VT, after receiving NRC and state regulators' consents to license transfers in 2018. The NorthStar Group-led decommissioning of Vermont Yankee is currently ahead of schedule for on-budget completion by 2026. NorthStar Vallecitos will also take advantage of the expertise and services of its affiliate, Waste Control Specialists ("WCS"), a leader in low-level radioactive waste management, packaging, transportation, and disposal. WCS currently operates radioactive and hazardous waste disposal facilities in Texas, and it has experience with on-site waste processing, management, packaging, and loading. WCS brings extensive Class A, B & C and Exempt Waste Disposal experience to the Vallecitos Nuclear Center decommissioning project. 7
The general company information for NorthStar Vallecitos is provided in Exhibit C and a simplified organization chart showing the planned ownership structure of NorthStar Vallecitos following the closing of the Transaction is provided in Exhibit D-2. 3.0 LICENSES The reactor licenses that are part of this Application were issued by the Atomic Energy Commission in the 1950s and 1960s; they are now regulated pursuant to 10 CFR Part 50. At present, GEHA holds possession-only licenses for three reactors (License Nos. DPR-1 , DR-10, and TR-1), which are already shut down and in SAFSTOR. GEHA has a license for one remaining test reactor (License No. R-33). As discussed more fully in Appendix A, the completion of the transfer of License No. R-33 to NorthStar Vallecitos will not occur until the reactor has permanently ceased operations and the license has been converted to possession-only status. The materials license (License No. SNM-960) was issued by the Atomic Energy Commission in 1966 and is now regulated pursuant to 10 CFR Part 70.
4.0 CONCLUSION
For the reasons stated above and in the appendices that follow, Applicants respectfully request that the NRC provide its consent to the transfers of control, within the meaning of 10 CFR 50.80 and 70.36, of the Licenses to NorthStar Vallecitos, no later than March 1, 2024 with such consent to be effective as of the closing of the Transaction, as referenced above. 8
APPENDIX A (Redacted) ADDITIONAL INFORMATION NEEDED BY THE NRC FOR CONSENT TO THE DIRECT TRANSFERS OF CONTROL OF THE REACTOR LICENSES FOR THE VALLECITOS NUCLEAR CENTER AND ASSOCIATED LICENSE AMENDMENTS License Nos.: DPR-1 (Docket No. 50-18) DR-10 (Docket No. 50-183) TR-1 (Docket No. 50-70) R-33 (Docket No. 50-73) This Appendix A provides the information required by the AEA and NRC regulations in 10 CFR Part 50, consistent with NRC guidance 1 for applications for consent to transfer ofreactor licenses. This information is provided by the Applicants for their request for consent to transfer the four licenses listed above for the reactors at the Vallecitos Nuclear Center (the "Reactor Licenses"). A.1 STATEMENT OF PURPOSE OF THE TRANSFER 10 CFR 50.80(b)(2) requires a statement regarding the "purposes for which the transfer of the license[s] is requested [and] the nature of the transaction necessitating or making desirable the transfer of the license[ s]." Applicants seek NRC consent to the transfer of the Reactor Licenses listed in this Appendix A, as well as License No. SNM-960 (the "Materials License") discussed in Appendix B, to permit the accelerated decommissioning and remediation of the Vallecitos Nuclear Center and in connection with and in furtherance of the Transaction, as described in the Application to which this Appendix is attached. Applicants' Transaction is desirable and of considerable benefit to the citizens of California as it is expected to accelerate the decommissioning of the Vallecitos Nuclear Center, including the 1 NUREG-1577, Rev. 1, Standard Review Plan on Power Reactor Licensee Financial Qualifications and Decommissioning Funding Assurance (Mar. 1999) (MLl 7033B536); Regulatory Guide 1.159, Rev. 2, Assuring The Availability Of Funds For Decommissioning Nuclear Reactors (Oct. 2011) (MLl 12160012). A-16
removal of radioactive material and release of all portions of the site as promptly as reasonably practicable. The Transaction also will leverage the substantial experience and expertise of NorthStar Vallecitos ' parent, NorthStar Group Services, Inc., and its affiliates in decommissioning and spent nuclear fuel management. NorthStar Vallecitos plans to complete radiological decommissioning, and remediation and removal of all hazardous substances from the Vallecitos Nuclear Center (as required by applicable law) by the end of 2030, with the exception of the Hillside Storage Facility, which will be decommissioned as promptly as reasonably practicable after removal by DOE of the spent nuclear fuel and high-level radioactive waste located at site. NorthStar Vallecitos is a wholly-owned subsidiary of NorthStar Group, whose qualifications are described in more detail below and in the Application to which this Appendix is attached. NorthStar Vallecitos will be technically qualified to engage in licensed activities at the Vallecitos Nuclear Center, as described below. In addition, NorthStar Vallecitos is, and after the Transaction will continue to be, financially qualified to engage in licensed activities, as described more fully below. NorthStar Vallecitos will also continue to comply with financial assurance requirements for decommissioning. A.2 TECHNICAL QUALIFICATIONS NorthStar Vallecitos will be technically qualified to carry out its responsibilities as the licensee responsible for the Vallecitos Nuclear Center, including the possession-only Reactor Licenses and the Materials License. It will perform the D&D and site restoration work at the Vallecitos Nuclear Center by leveraging the over 30 years of experience of NorthStar Group as a general decommissioning contractor on commercial and industrial projects and through its affiliate WCS. As described below, at the time of the transfer to NorthStar Vallecitos, none of the Reactor A-17
Licenses will authorize operation. Three of the four Reactor Licenses are already possession-only. The closing of the Transaction cannot be completed until the fourth, License No. R-33 , also becomes possession-only. As such, NorthStar Vallecitos will not be authorized to operate any of the reactors; rather, its licensed authority will be limited to possessing nuclear material, maintaining the Vallecitos Nuclear Center in a safe condition (including storage, control, and maintenance of all nuclear material), and D&D of the facilities subject to the Reactor Licenses. Upon the closing of the Transaction, NorthStar Vallecitos will assume responsibility for and control over the Vallecitos Nuclear Center, the Reactor Licenses, and the Materials License. As shown on the organization chart(s) provided in Exhibit E, NorthStar Vallecitos intends to staff technical support positions that are important to the safe storage of spent nuclear fuel and conduct of radiological protection with Bryant Akins as the RAD protection manager. Mr. Akins has over 40 years ' experience and his expertise includes RAD protection program implementation, management, and oversight for both operating nuclear power plants and facilities transitioning from active operations to shut down, thru active decommissioning and spent fuel management. The organizational staffing levels after the transfer of the Reactor Licenses will ensure sufficient qualified resources are available to fully meet the requirements of the Reactor Licenses and applicable NRC regulations and orders. The project management organization (see Exhibit E) will provide experienced strategic and technical oversight over both the D&D work and spent nuclear fuel management. Executive level support will be provided by NorthStar Group 's CEO (Scott State), the President & COO of WCS (David Carlson), NorthStar Group 's VP/Director of Health and Safety (Gary Thibodeaux), and NorthStar Group ' s Nuclear Decommissioning Program A-18
Manager (Billy Reid) - the same team that successfully manages NorthStar' s Vermont Yankee and Crystal River (Unit 3) decommissioning I spent fuel management projects. NorthStar Vallecitos will receive experienced NorthStar corporate support for licensing, regulatory matters, quality control, external affairs, legal, contracts, accounting, finance, payroll, human resources, and IT. Matthew Hooper will be the Project Manager and will be further supported by the Deputy Program Manager, Luke Self - experienced hands who have worked directly on NorthStar' s other decommissioning projects. Direct reports to the Project Manager will provide Facility Management (including Security), Planning & Engineering, RAD Protection, D&D Management for each reactor, Waste Management and Nuclear Test Reactor/Hillside Storage Facility Management. WCS, an affiliate of NorthStar Vallecitos and NorthStar Group, will provide on-site waste processmg, management, packaging, and loading, as well as off-site disposal of radioactive material in accordance with the Texas Compact and WCS ' licenses. NorthStar Vallecitos will implement a management approach that provides:
- Efficient and effective D&D planning, preparation, and execution.
- The presence of a safety conscious work environment, including day-to-day industrial safety and radiological protection.
- Safe handling of spent nuclear fuel/materials and all other radioactive waste.
- Rigorous project management that includes a proven, effective corrective action program; well established personnel performance reporting and monitoring metrics; and financial controls.
A-19
NorthStar Group employees and contractors engaged by NorthStar Vallecitos performing remediation and decommissioning services with respect to the Vallecitos Nuclear Center following completion of the Transaction will be qualified for their positions in accordance with the applicable Vallecitos Technical Specifications and Quality Assurance Program Manual requirements. NorthStar Vallecitos will develop a new Quality Assurance Program Manual ("QAPM") to implement NorthStar Quality Assurance documents. The NorthStar Vallecitos QAPM will control any activities that affect the quality of structures, systems, and components ("SSCs") classified as important-to-safety ("ITS"). Fissile material handling operations will be subcontracted to a qualified vendor. NorthStar Vallecitos will implement the current Vallecitos Nuclear Center Radiological Emergency Plan and other documents, which may be modified as the hazards decrease. As part of the Transaction, GEHA will transfer to NorthStar Vallecitos control over the assets related to the Vallecitos Nuclear Center that will be needed to maintain the Vallecitos Nuclear Center reactors and the site in accordance with the Reactor Licenses and NRC requirements. These assets will include, in addition to the structures and equipment, the necessary books, records, safety and maintenance manuals and engineering construction documents, as set forth in the APSA. As noted previously, the NorthStar Vallecitos project organization ultimately will report to NorthStar Group's CEO, Scott E. State, P.E., who is a licensed nuclear engineer and has extensive experience working in the nuclear industry and on environmental remediation projects. In addition to Scott State, the management team includes experienced personnel, such as President and Chief Operating Officer David Carlson, who has more than 25 years of experience A-20
leading the growth and operations of nuclear energy and environmental management companies; Gary Thibodeaux, who has been NorthStar Group's Director of Health and Safety since 2002 with more than 30 years of experience in the health and safety industry; Gregory G. Di Carlo, who has been NorthStar Group's General Counsel since 2010; and Billy Reid, Jr. , NorthStar Group's Nuclear Decommissioning Program Manager who has successfully led the ownership transition team for the Vermont Yankee and Crystal River Nuclear Power plant decommissioning projects. Resumes for key executives are provided in Exhibit F. NorthStar Group's and its affiliates' repeated success and expertise in decommissioning nuclear reactors and related sites and facilities, as reflected in the decommissioning project organization and plan for the Vallecitos Nuclear Center, will provide an experienced nuclear management team to assure compliance with the requirements of the Licenses and the Commission regulations. The NorthStar Vallecitos management team and the specific knowledge of its strategic partners will allow NorthStar Vallecitos to complete D&D and ultimately enable site release for umestricted use. For these reasons, N orthStar Vallecitos has the necessary technical qualifications to safely perform the activities described in this Application. A.3 FINANCIAL QUALIFICATIONS A.3.1 Decommissioning Financial Assurance As described below, the proposed transfer of the Reactor Licenses to NorthStar Vallecitos will not occur until after the NTR has permanently ceased operations and License No. R-33 converted to possession-only. Upon satisfaction of these conditions, there will no longer be an operating reactor A-21
at the Vallecitos Nuclear Center. Accordingly, NorthStar Vallecitos' licensed activities will include, but not be limited to, possessing nuclear material, maintaining the Vallecitos Nuclear Center in a safe condition (including storage, control, and maintenance of all nuclear material), D&D of the Vallecitos Nuclear Center (including processing all nuclear material at the site for offsite disposal at an appropriate facility), and providing appropriate protection for the site until all nuclear material located at the site is removed and decommissioning is completed, each in accordance with the Reactor Licenses and all applicable NRC regulations and orders. 2 NorthStar Vallecitos' licensed activities will not include operation of any of the reactors at the Vallecitos Nuclear Center. Thus, the NDF will provide the appropriate basis for the financial qualifications ofNorthStar Vallecitos, as all ofNorthStar Vallecitos activities will be related to decommissioning the site and maintaining special nuclear material until it can be removed from the site. A.3.1.1 NDF Prior to the closing of the Transaction, decommissioning financial assurance for the Reactor Licenses, the Materials License, and the CDPH License will continue to be provided through the existing surety bonds maintained by GEHA. Under the terms of the Transaction, GE will make an initial deposit into a single NDF of up to a maximum of$[ - ], which amount may be reduced as described below. The amount of this deposit has been calculated based on the combination of the most recent decommissioning NorthStar Vallecitos will also be authorized to conduct licensed activities pursuant to the Materials License, as that term is defined in Appendix B to the Application, and the CDPH License. A-22
cost estimates for the Reactor Licenses, the Materials License, and the CDPH License.3 Thus, the decommissioning financial assurance requirements for the Reactor Licenses (and the Materials License and the CDPH License) will be satisfied through the "prepayment" method. The NDF will be non-qualified within the meaning of Internal Revenue Code ("IRC") § 468A. A form of the NDF Trust Agreement governing the NDF is provided as Exhibit I to this Application. The Applicants are negotiating the final form of the NDF Trust Agreement with potential trustees. Applicants do not expect that there will be material changes to the material terms of the NDF Trust Agreement resulting from these negotiations and will supplement this Application when the final form of the NDF Trust Agreement has been negotiated. Prior to the closing of the Transaction, GE will assign the NDF (either directly or via a series of assignments or contributions through affiliates of GE or GEHA) to GEHA. GEHA will then transfer the NDF to NorthStar Vallecitos at or upon closing. As stated above, the maximum amount that may be deposited into the NDF is$[ - ]. However, the parties anticipate that certain decommissioning activities will take place prior to the closing of the Transaction as necessary to meet NRC requirements. Therefore, the amount of the NDF ultimately transferred to NorthStar Vallecitos will be reduced from the$[ - ] to reflect the costs for decommissioning work performed by or at the direction ofGEHA prior to the transfer to NorthStar Vallecitos. However, Applicants expect that the funds in the NDF at the time of transfer to NorthStar Vallecitos will be sufficient to provide reasonable assurance for the decommissioning 3 GEHA, Site-Specific Decommissioning Cost Estimate and Decommissioning Funding Plan for the GE Test Reactor (GETR), License TR-1 , Docket 50-70, Rev. 0 (Mar. 6, 2020) (non-public); GEHA, Decommissioning Funding Plan NRC Material License, License SNM-960, Docket 70-754, Rev. 5 (Mar. 30, 2022) (ML22089A087); GEHA, GNF-A/GEH Financial Assurance of Decommissioning Funds - Surety Bond Riders (Mar 31 , 2023) (ML23 l 04A4 l 7); GEHA, Decommissioning Funding Plan, California Radiologic Health Branch, License No. CA 0017-01 , Rev. 5 (Mar. 24, 2022). A-23
work remaining at the time of the closing of the Transaction. The NDF may be terminated, and the amounts within it returned to GE, if the NDF Trust Agreement is not assigned from GEHA to NorthStar Vallecitos within 60 days of its effective date (i.e., if the closing of the Transaction does not occur within 60 days after the NDF is funded). After the closing of the Transaction, GE and GEHA will have no further obligations with respect to funding the NDF or otherwise providing decommissioning financial assurance for the Reactor Licenses, the Materials License, or the CDPH License. NorthStar Vallecitos intends to maintain a single NDF to take advantage of administrative cost savings measures. NorthStar Vallecitos has analyzed the expected costs of decommissioning of all of the Reactor Licenses, as well as the Materials License and the CDPH License, including the expected annual cash flows, and it believes that with conservative NDF investments that are designed to assure the preservation of the fund to be available for prompt decommissioning, the amount in the NDF will be sufficient to pay all of the expected costs of decommissioning the site, including ultimately the Hillside Storage Facility. Further, the major decommissioning work will be performed under a fixed pay-item amount for each discrete scope of work. To ensure the performance of the tasks, withdrawals from the NDF will be limited under a decommissioning pay-item approach, which reasonably assures completion of the work within the cost estimates. A.3.1.2 Additional Financial Support In addition, NorthStar Vallecitos will have in place additional sources of funds to be available, if necessary, to ensure the completion of decommissioning of the Vallecitos Nuclear Center: (1) a Financial Support Agreement from NorthStar Group Services, Inc. to provide up to
] to NorthStar Vallecitos under certain specified conditions; (2) a Disposal A-24
Guarantee whereby WCS guarantees that it has the capacity within its low-level radioactive waste disposal facility in Andrews County, Texas to dispose of the low-level waste generated at the Vallecitos Nuclear Center in accordance with NorthStar Vallecitos decommissioning obligations under the Transaction; (3) a reservation of letter of credit capacity to provide a standby letter of credit of at least [ ] if the project decommissioning and site release is delayed or certain default conditions occur; (4) a Standby and Provisional Trust to provide up to
]; and (5) a parent guarantee issued by NorthStar Group Services, Inc. for the payment and performance of obligations under of NorthStar Vallecitos with respect to the Vallecitos Licensed Facilities and Vallecitos Nuclear Center. While NorthStar Vallecitos does not expect that these sources of funds will be required to provide funding for decommissioning activities, they will remain available to ensure completion of decommissioning until: in the case of item (1) (Financial Support Agreement) and item (5) (parent guarantee), Buyer completes its decommissioning obligations under the Transaction, in the case of item (2) (Disposal Guarantee),
removal of the nuclear materials at the site is completed in accordance with NorthStar Vallecitos ' decommissioning obligations under the Transaction, and in the case of items (3) (standby letter of credit) and item (4) (Standby and Provisional Trust), the NRC releases the Vallecitos Licensed Facilities from NRC jurisdiction for umestricted use (other than the Hillside Storage Facility). Copies of the form of these documents, which will be executed at the closing of the Transaction, are provided in Exhibit J. Exhibit J contains confidential commercial and financial information and Applicants request that this information be withheld from public disclosure pursuant to 10 CFR 2.390. A copy of the forms of each of these additional financial assurance documents suitable for public disclosure are included as Exhibit K, which have been redacted to remove A-25
proprietary information. An affidavit requesting withholding of the unredacted version is provided in Exhibit A. A.3.1.3 Requested License Conditions Applicants request that the NRC include license conditions that impose the requirements of 10 CFR 50.75(h)(l) and 50.82(a)(8) on the investments of and withdrawals from the NDF. Imposition of these requirements would help ensure the adequacy of the NDF to provide decommissioning financial assurance for the Reactor Licenses, the Materials License, and the CDPH License for the following reasons. First, 10 CFR 50.75(h)(l) places additional restrictions on the investments of funds held by the NDF, amendments of the NDF trust agreement without NRC consent, and withdrawals from the NDF prior to commencing active decommissioning. These restrictions require: (i) that a nuclear decommissioning trust's assets are not invested in the licensee's own securities and the trustee adheres to the "prudent investor standard"; (ii) that the licensee does not act as an investment manager for the trust funds or give day-to-day investment management direction; (iii) that the terms of the trust agreement are not amended without 30 working days written notice to the applicable NRC office (in this case, the Director of Nuclear Material Safety and Safeguards ("NMSS")); and (iv) that the appropriate NRC office is notified at least 30 working days in advance of any withdrawals from the trust other than those made pursuant to 10 CFR 50.82(a)(8) or for payment of administrative costs of the trust (including taxes). These provisions are intended to ensure that the decommissioning funds contained within the trust are protected and subject to NRC oversight. Second, 10 CFR 50.82(a)(8) places conditions on the use of decommissioning trust funds more generally, including requiring that the withdrawals (i) will be only for decommissioning activities consistent with the definition of "decommissioning" in 10 CFR 50.2, (ii) will not reduce the value of the trust fund below the amount necessary to place A-26
the reactor in SAFSTOR if necessary to allow growth in the trust to provide additional assurance, and (iii) will not reduce the value of the trust fund below what is necessary to complete decommissioning. In short, the requested license conditions impose obligations in the Reactor Licenses that further restrict the use of the NDF for only decommissioning purposes and provide additional information to the NRC to monitor and assure NorthStar Vallecitos will possess sufficient funds to complete decommissioning of the Vallecitos Nuclear Center as a whole. 4 That is, they are conservative in that they provide additional assurance beyond what is required under NRC regulations to provide decommissioning financial assurance for research and test reactor licenses and allow the NRC to conclude that the NDF will provide sufficient funds to assure decommissioning of the entire site. Upon approval of these amendments, the provisions of 10 CFR 50.75(h)(l) and 50.82(a)(8) will apply to the NDF . Exhibit L-1 identifies the proposed changes in a mark-up of the existing Licenses, except for License No. R-33 which will be revised as part of the LAR described in footnote 5 of Enclosure 1, and Exhibit L-2 provides a clean version of the Licenses depicting the proposed changes. A.4 FOREIGN OWNERSHIP, CONTROL, OR DOMINATION Section 104d of the AEA provides that "[ n ]o license [for a reactor] may be issued to any corporation or other entity if the Commission knows or has reason to believe it is owned, controlled, or dominated by an alien, a foreign corporation, or a foreign government." 42 USC § 2134(d). NorthStar Vallecitos is a wholly owned subsidiary ofNorthStar Group Services, Inc. , 4 These conditions would allow for withdrawals for decommissioning under the Materials License or the CDPH License. A-27
a Delaware corporation. Accordingly, NorthStar Vallecitos is not owned, controlled, or dominated by an alien, a foreign corporation, or a foreign government, consistent with the requirements of 42 USC § 2134(d) and the NRC's implementing regulations in 10 CFR 50.38. As the licensed entity with possession and responsibility for management and decommissioning of the Vallecitos Nuclear Center, NorthStar Vallecitos will act for itself and not as the agent or representative of any other person in the proposed transfers of the Reactor Licenses. A.5 ACCESS TO RESTRICTED DATA AND NATIONAL SECURITY INFORMATION This Application does not contain any Restricted Data or other classified National Security Information, and it is not expected that any such information will become involved in the licensed activities of NorthStar Vallecitos. However, in the event that such information does become involved, and, in accordance with 10 CFR 50.37, "Agreement Limiting Access to Classified Information," NorthStar Vallecitos agrees that it will appropriately safeguard such information and will not permit any individual to have access to such information until the individual has been appropriately approved for such access under the provisions of 10 CFR Part 25 , "Access Authorization," and/or 10 CFR Part 95 , "Facility Security Clearance and Safeguarding of National Security Information and Restricted Data." A.6 ENVIRONMENTAL CONSIDERATIONS There is no requirement for any environmental review associated with this request because requests for consent to license transfers and conforming license amendments are categorically excluded from such review pursuant to 10 CFR 51.22(c)(21). A-28
A.7 PRICE-ANDERSON INDEMNITY AND NUCLEAR INSURANCE Under the terms of the APSA, NorthStar Vallecitos will acquire GEHA 's rights to third-party nuclear liability protection under the American Nuclear Insurers Facility Form policy relating to the Vallecitos Nuclear Center and all activities at the Vallecitos Nuclear Center. Accordingly, the Applicants request that the NRC approve the assignment and transfer of the Price-Anderson indemnity by amending the Price-Anderson indemnity agreement for the Reactor Licenses to delete references to "GE-Hitachi Nuclear Energy Americas, LLC" and instead insert "NorthStar Vallecitos, LLC," to be effective as of the completion of the proposed transfers of the Licenses. A.8 CONFORMING AMENDMENTS AND LICENSE CONDITIONS In accordance with 10 CFR 50.90, "Application for amendment oflicense, construction permit, or early site permit," Applicants respectfully request the NRC (1) to approve conforming license amendments to reflect NorthStar Vallecitos as the new licensee, and (2) to impose as license conditions certain specific requirements related to the NDF. Specifically, Applicants request that the NRC impose the obligations of 10 CFR 50.75(h)(l) and 50.82(a)(8) with respect to the investments of the NDF, withdrawals of funds from the NDF, and submittal ofreports to the NRC. See also Section A.3 .1.3 above. These requested amendments should be issued for the following reasons. First, the NRC has generically determined in 10 CFR 2.1315(a) that proposed conforming administrative amendments that do nothing more than "conform the license to reflect the transfer action involve[] respectively, 'no significant hazards consideration,' or 'no genuine issue as to whether the health and safety of the public will be significantly affected."' A-29
Second, to the extent that the NRC determines that these amendments do more than simply conform the Reactor Licenses, these proposed license amendments meet the criteria for the NRC to make a No Significant Hazards Consideration Determination pursuant to 10 CFR 50.92(c) because the proposed license amendments would not (1) involve a significant increase in the probability or consequences of any accident; (2) create the possibility of a new or different kind of accident than previously evaluated; or (3) involve a significant reduction in a margin of safety. Applicants also request that the NRC include a license condition imposing the reporting requirements in 10 CFR 50.82(a)(8) on the Licenses for the Vallecitos Nuclear Center. Because these requirements are more robust than the requirements imposed by 10 CFR 50. 75( d), Applicants request that the NRC consider this license condition adequate to fulfill NorthStar Vallecitos ' obligations for reporting under 10 CFR 50.75(d). Thus, the NRC should issue the requested conforming license amendments to reflect the proposed transfers of the Reactor Licenses. A-30
APPENDIXB ADDITIONAL INFORMATION NEEDED BY THE NRC FOR CONSENT TO THE DIRECT TRANSFER OF CONTROL OF THE MATERIALS LICENSE FOR THE VALLECITOS NUCLEAR CENTER AND ASSOCIATED LICENSE AMENDMENTS License No.: SNM-960 (Docket No. 70-754) Appendix B provides the information required by the AEA and NRC regulations in 10 CFR Part 70, consistent with NRC guidance for applications for consent to transfer radioactive materials licenses. 1 This information is provided by the Applicants for their request for consent to transfer the license listed above for the special nuclear material at the Vallecitos Nuclear Center (the "Materials License"). The Materials License generally applies to licensed activities at the Hillside Storage Facility, a designed facility used to store special nuclear material, including spent nuclear fuel, located at the Vallecitos Nuclear Center in Sunol, CA. B.1 DESCRIPTION OF THE TRANSACTION Describe any planned changes in the organization, including, but not limited to, transfer of stocks or assets and mergers, change in members on Board of Directors, etc. Provide the new licensee name, mailing address, and contact information, including phone numbers. Clearly identify when the amendment requested is due to a name change only. B.1.1. Description of the Transaction Applicants seek NRC consent to the transfer of the Materials License in connection with and in furtherance of the Transaction, as described in the Application to which this Appendix is attached. NUREG-1556, Volume 15, Rev. 1, Consolidated Guidance About Materials Licenses: Guidance About Changes of Control and About Bankruptcy Involving Byproduct, Source, or Special Nuclear Materials Licenses (June 2016) (ML16181A003). B-1
Following the closing of the Transaction, NorthStar Vallecitos will become the license-holder authorized to conduct licensed activities and to possess the nuclear material at the Vallecitos Nuclear Center. The qualifications of NorthStar Vallecitos, and its parent NorthStar Group Services, Inc. , are further described in the Application and Appendix A thereto. Upon the closing of the Transaction, which is conditioned on receipt of NRC consent to this Application, NorthStar Vallecitos will assume possession of all special nuclear material and managerial responsibility for all licensed activities under the Materials License, including decommissioning activities. Completion of the Transaction will place licensed responsibility in an organization focused on radiological decommissioning. NorthStar Vallecitos ' licensed activities under the Materials License will include, but not be limited to, possessing special nuclear material (including spent nuclear fuel), maintaining the special nuclear material in a safe condition (including storage, control, and maintenance of all nuclear material), and providing appropriate protection for the site until all special nuclear material located at the site is removed and decommissioning is completed, each in accordance with the Materials License and all applicable NRC regulations and orders. The Hillside Storage Facility will be decommissioned by NorthStar Vallecitos as promptly as reasonably practicable after removal by DOE of the spent nuclear fuel and high-level radioactive waste located at the site. B.1.2. Description of Any Planned Changes in the Organization The license required key position functions will be maintained. NorthStar Vallecitos will maintain the Environmental Health and Safety ("EHS") Functions including radiological protection, environmental, security, licensing, emergency planning, training, fire protection, and quality. The B-2
facilities maintenance resources will be maintained. The NTR and Hot Cell staff will be decreased when they are no longer required. Skilled, trained D&D and waste management planning and operations personnel will be mobilized throughout the project. More information on the planned organization is provided in Appendix A to the Application to which this Appendix B is attached. B.1.3. Changes to Management NorthStar Vallecitos will maintain the licensed key personnel functions for the Materials License. The VP of Nuclear Operations will be staffed by Billy Reid, VP D&D Program Manager. The Vallecitos Nuclear Center Site Manager will be staffed by Matt Hooper, D&D Project Manager. The EHS Key Position function will be maintained. NorthStar Vallecitos employees and contractors will not be employed without being qualified for their positions in accordance with the applicable Quality Assurance Program and regulatory requirements for the Materials License. B.1.4. Technical Qualifications NorthStar Vallecitos will be technically qualified to carry out its responsibilities as the licensee responsible for the Materials License. NorthStar Vallecitos will perform the decommissioning, decontamination, and site restoration work by leveraging the experience of its parent company, NorthStar Group Services, Inc. , and existing Vallecitos Nuclear Center staff NorthStar Group has more than 30 years ' experience as a general decommissioning contractor on commercial and industrial projects while performing decontamination and decommissioning (D&D) work. Through its subsidiaries, NorthStar Group holds the NRC Licenses for the Crystal River Unit 3 Nuclear Generating Plant ("CR3") in Citrus County, Florida, and the former Vermont Yankee Nuclear Power Station ("VY"), and it is responsible for the accelerated decommissioning of VY and CR3. As shown on the organization chart(s) provided in Exhibit E, NorthStar Vallecitos intends to staff technical support positions that are important to the safe storage of fuel and conduct B-3
of radiological protection with key members of the existing Vallecitos Nuclear Center staff who are already trained and qualified and would fill positions with responsibilities analogous to their pre-license transfer responsibilities. B.2 CHANGES IN PERSONNEL OR DUTIES Describe any changes in personnel or duties that relate to the licensed program. Include training and experience for new personnel and any changes in the training program. As discussed above in Section B.1.2, NorthStar Vallecitos will maintain the licensed key personnel functions for the Materials License. The VP of Nuclear Operations will be staffed by Billy Reid, VP D&D Program Manager. The Vallecitos Nuclear Center Site Manager will be staffed by Matt Hooper, D&D Project Manager. The EHS Key Position function will be maintained. NorthStar Vallecitos employees and contractors will not be employed without being qualified for their positions in accordance with the applicable Quality Assurance Program and regulatory requirements. B.3 CHANGES IN LOCATION, FACILITIES, OR EQUIPMENT Describe any changes in the location, facilities, equipment, radiation safety program, use, possession, waste management, or other procedures that relate to the licensed program. Upon the closing of the Transaction, NorthStar Vallecitos will be the license-holder authorized to conduct licensed activities and to possess the nuclear material at the Vallecitos Nuclear Center. NorthStar Vallecitos will also hold title to the real estate and facilities encompassed within the Vallecitos Nuclear Center, including the areas subject to the Materials License. NorthStar Vallecitos does not currently anticipate changes to the facilities, equipment, radiation safety program, use, possession, waste management, or other procedures at the Vallecitos Nuclear Center immediately after the transfer of the Materials License, except as may be authorized by the NRC. B-4
NorthStar Vallecitos does not anticipate changes to operating or emergency procedures. Future revisions will be communicated to the NRC as site conditions change. Further, while the majority of licensed activities under the Materials License will continue to be conducted at the Vallecitos Nuclear Center, NorthStar Vallecitos may be supported by its affiliates and contractors located at other facilities. Further, GEHA will transfer to NorthStar Vallecitos control over the assets needed to maintain the Vallecitos Nuclear Center, including the facilities subject to the Materials License; such assets will include the necessary books, records, safety and maintenance manuals and engineering construction documents required to support license activities. Upon the closing of the Transaction, GEHA will no longer have the responsibility to provide support for licensed activities at the Vallecitos Nuclear Center, except to the extent specifically contemplated in the APSA. B.4 CHANGES IN STATUS OF FACILITIES, EQUIPMENT, AND RADIATION SAFETY PROGRAM Describe the status of the licensee's facilities, equipment, and radiation safety program, including any known contamination and whether decontamination will occur prior to transfer. Include the status of calibrations, leak tests, area surveys, wipe tests, training, quality control, and related records. NorthStar Vallecitos will maintain existing radiological surveillances, environmental monitoring, and other inspections, as supplemented to address planned decommissioning activities. Training will be adapted to planned decommissioning operations. Radiological and hazardous material inventories will be decreased over time until final site release is obtained. Upon the closing of the Transaction, all required records, including surveillance items and records and documents related to quality control programs will transfer to NorthStar Vallecitos or remain available to it, as necessary. B-5
B.5 DECOMMISSIONING FUNDING If current decommissioning funding plans ("DFP") will be changed because of the transfer, the revised DFP should be submitted. If other financial assurance documents will be changed as the result of the transfer, confirm that all financial assurance instruments associated with the license will be held in the transferee's name before the license is transferred, and as required by 10 CFR 30.35(1), the licensee must, within 30 days, submit financial instruments reflecting such changes. GEHA currently provides decommissioning financial assurance through the use of surety bonds. GEHA intends to continue to maintain the surety bonds until the closing of the Transaction. Upon the closing of the Transaction, NorthStar Vallecitos' decommissioning financial assurance will be satisfied by the use of a pre-paid NDF as discussed more fully in Section A.3 of Appendix A to this Application. The form of the NDF Trust Agreement governing the NDF is provided in Exhibit I. The amount to be deposited in the NDF has been calculated based on the combination of the most recent decommissioning cost estimates for the Materials License as well as for the Reactor Licenses and the CDPH License, as may be adjusted downward to reflect the costs for decommissioning work performed by or at the direction of GEHA prior to the transfer to NorthStar Vallecitos. 2 NorthStar Vallecitos intends to rely upon the NDF to provide for decommissioning financial assurance for the Materials License.3 NorthStar Vallecitos has analyzed the expected costs of 2 GEHA, Site-Specific Decommissioning Cost Estimate and Decommissioning Funding Plan for the GE Test Reactor (GETR), License TR-1, Docket 50-70, Rev. 0 (Mar. 6, 2020) (non-public); GEHA, Decommissioning Funding Plan NRC Material License, License SNM-960, Docket 70-754, Rev. 5 (Mar. 30, 2022) (ML22089A087); GEHA, GNF-A/GEH Financial Assurance of Decommissioning Funds - Surety Bond Riders (Mar 31 , 2023) (ML23 l 04A4 l 7); GEHA, Decommissioning Funding Plan, California Radiologic Health Branch, License No. CA 0017-01 , Rev. 5 (Mar. 24, 2023). 3 As stated in the Application and Appendix A to the Application, NorthStar Vallecitos also intends to rely on the NDF to provide decommissioning financial assurance for the Reactor Licenses and the CDPH License. B-6
decommissioning, including the expected annual cash flows , and it believes that with conservative NDF investments that are designed to assure the preservation of the fund to be available for prompt decommissioning, the required funding level will be sufficient to pay all of the expected costs of decommissioning the entire Vallecitos Nuclear Center, Hillside Storage Facility and other facilities and activities subject to the Reactor Licenses and the Materials License. More information on the NDF is provided in Section A.3 of this Application. B.6 DECOMMISSIONING FUNDING RECORDS Confirm that all records concerning the safe and effective decommissioning of the facility will be transferred to the transferee or to the NRC, as appropriate. These records include documentation of surveys of ambient radiation levels and fixed and or removable contamination, including methods and sensitivity. The closing of the Transaction is anticipated to have no effect on any decommissioning records. On the date of closing of the Transaction, the status of the licensed facilities , including, but not limited to, the status of decontamination and decommissioning activities, and all records concerning the decommissioning of the Vallecitos Nuclear Center will either transfer to NorthStar Vallecitos or remain available to it, as necessary. B.7 CONFORMING AMENDMENTS AND LICENSE CONDITIONS In accordance with 10 CFR 70.34, "Amendment of Licenses," Applicants respectfully request the NRC (1) to approve conforming license amendments to the Materials License to reflect that NorthStar Vallecitos is the new licensee, and (2) to impose as license conditions certain specific requirements on the NDF. Specifically, the amendment requests that the NRC impose obligations similar to those required under 10 CFR 50.75(h)(l) and 50.82(a)(8), as discussed more fully in B-7
Section A.3.1.3 of this Application, with respect to the investment of the NDF, withdrawals of funds from the NDF, and reporting to the NRC on its fund balance. Applicants also request that the NRC include a license condition imposing the reporting requirements in 10 CFR 50.82(a)(8) on the Licenses. Because these requirements are more robust than the requirements imposed by 10 CFR 70.25, Applicants request that the NRC consider this license condition adequate to fulfill NorthStar Vallecitos ' obligations for reporting under 10 CFR 70.25. Exhibit L-1 identifies the proposed changes in a mark-up of the Materials License and Exhibit L-2 provides a clean version of the Materials License. B.8 TRANSFEROR AND TRANSFEREE AGREE TO TRANSFERRING CONTROL Confirm that both the transferor and transferee agree to transferring control of the licensed material and activity, and the conditions of transfer, and that the transferee has been made aware of any open inspection items and its responsibility for possible resulting enforcement actions. Applicants agree to the transfer of control of the licensed material and activity and the conditions of the transfer as reflected by the execution of the APSA. B.9 TRANSFEREE'S COMMITMENT TO ABIDE BY ALL CONSTRAINTS, CONDITIONS, REQUIREMENTS, AND COMMITMENTS Confirm that the transferee will abide by all constraints, conditions, requirements, representations, and commitments of the transferor or that the transferee will submit a complete description of the proposed licensed program. NorthStar Vallecitos has been made aware of all material, if any, NRC inspection findings and has access to all NRC inspection findings. From and after the closing of the Transaction, NorthStar Vallecitos agrees to abide by all constraints, conditions, requirements, representations, and B-8
commitments GEHA made previously to the NRC. NorthStar Vallecitos will assume all responsibilities identified in and attributed to the existing NRC licenses and applicable NRC requirements including responsibility for compliance with the current licensing basis for the Materials License. B-9
. AFFIRMATION I, Scott E. _State, do hereby declare under penalty of perjury under the laws of the United States of America that the following is true and correct: ( 1) I am the Chief Executive Officer and Chief Nuclear Officer of NortbStar Vallecitos, LLC ("NortbStar Vallecitos"), (2) I am duly authorized to execute and file this certification on behalf of NortbStar Vallecitos, and (3) the statements set forth *in the attached Application for Consent to Direct Transfers of Control of Licenses and Related Conforming License Amendments regarding NorthStar Vallecitos are true and correct to the best of my information, knowledge and belief.
AFFIRMATION I, Jay T. Wileman, do hereby declare under penalty of perjury under the laws of the United States of America that the following is true and correct: (1) I am the President and Chief Executive Officer of GE-Hitachi Nuclear Energy Americas, LLC ("GEHA"), (2) I am duly authorized to execute and file this certification on behalf of GEHA, and (3) the statements set forth in the attached Application for Consent to Direct Transfers of Control of Licenses and Related Conforming License Amendments regarding GEHA are true and correct to the best of my information, knowledge and belief. GE-Hitachi Nuclear E Americas, LLC By: ileman Date: --+-f+
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APPLICATION FOR CONSENT TO DIRECT TRANSFERS OF CONTROL OF LICENSES AND RELATED CONFORMING LICENSE AMENDMENTS INDEX TO EXHIBITS EXHIBIT NO. DESCRIPTION A Applications and Affidavits for Withholding of Proprietary Information B General Company Information for GE-Hitachi Nuclear Energy Americas, LLC C General Company Information for NorthStar Vallecitos, LLC D-1 Simplified Organizational Chart Before the Transfer D-2 Simplified Organizational Chart After the Transfer E Project Management Organization F Resumes G Asset Purchase and Sale Agreement (proprietary) H Asset Purchase and Sale Agreement (redacted) I Form of Nuclear Decommissioning Fund Trust Agreement J Consolidated Financial Assurance Instruments (proprietary) K Consolidated Financial Assurance Instruments (redacted) L-1 Conforming Amendments and License Conditions for Each License (Mark-up) L-2 Conforming Amendments and License Conditions for Each License (Clean)
EXHIBIT A APPLICATION FOR WITHHOLDING OF GE-HITACHI NUCLEAR ENERGY AMERICAS, LLC AND AFFIDAVIT OF SCOTT P. MURRAY I, Scott P. Murray, Manager, Facility Licensing of GE-Hitachi Nuclear Energy Americas, LLC ("GEHA"), state that:
- 1. I am the Manager, Facility Licensing for GEHA, and I have been delegated the function of reviewing the information described in paragraph (2), which is sought to be withheld, and have been authorized to apply for its withholding.
- 2. GEHA is providing information in support of its "Application for Consent to Direct Transfers of Control of Licenses and Related Confirming License Amendments." The proprietary information sought to be withheld in this submittal is that which is appropriately marked in: (1) Exhibit A (the information marked with brackets);
(2) Exhibit G, Asset Purchase and Sale Agreement; and (3) Exhibit J, Consolidated Financial Assurance Instruments. These documents constitute proprietary commercial and financial information that should be held in confidence by the U.S. Nuclear Regulatory Commission (the "NRC") pursuant to the policy reflected in 10 CFR 2.390(a)(4) and 10 CFR 9.17(a)(4) because:
- a. This information is and has been held in confidence by GEHA.
- b. The information is of a type that is held in confidence by GEHA, and there is a rational basis for doing so because the information contains sensitive financial competitive information.
- c. This information is being submitted to the NRC in confidence.
- d. This information has been marked in accordance with 10 CFR 2.390(b)(l).
- e. This information is not available in public sources and could not be readily gathered from other publicly available information.
- f. Public disclosure of this information would create substantial harm to the competitive position of GEHA by disclosing its internal commercial, financial and proprietary information to other parties whose commercial interests may be adverse to those of GEHA.
- 3. Accordingly, GEHA requests that the designated documents be withheld from public disclosure pursuant to the policy reflected in 10 CFR 2.390(a)(4) and 10 CFR 9.17(a)( 4).
- 4. The averments of fact set forth in this affidavit are true and correct to the best of my knowledge, information, and belief Exhibit A-1
- 5. I declare under penalty of perjury under the laws of the United States that the foregoing is true and correct.
Executed on this 31 Sday of August 2023 LLC Scott P. Murray Manager, Facility Licensing Exhibit A-2
APPLICATION FOR WITHHOLDING OF NORTHSTAR VALLECITOS, LLC AND AFFIDAVIT OF GREGORY DICARLO I, Gregory G. DiCarlo, Vice President, General Counsel & Secretary of NorthStar Vallecitos, LLC ("NorthStar Vallecitos"), state that:
- 1. I am the Vice President, General Counsel & Secretary, and I have been delegated the function of reviewing the information described in paragraph (2), which is sought to be withheld, and have been authorized to apply for its withholding.
- 2. NorthStar Vallecitos is providing information in support of its "Application for Consent to Direct Transfers of Control of Licenses and Related Conforming License Amendments."
The proprietary information sought to be withheld in this submittal is that which is appropriately marked in: (1) Exhibit A (the information marked with brackets); (2) Exhibit G, Asset Purchase and Sale Agreement; and (3) Exhibit J, Consolidated Financial Assurance Instruments. These documents constitute proprietary commercial and financial information that should be held in confidence by the U.S. Nuclear Regulatory Commission (the "NRC) pursuant to the policy reflected in 10 CFR 2.390(a)(4) and 10 CFR 9.17(a)(4) because:
- a. This information is and has been held in confidence by NorthStar Vallecitos.
- b. The information is of a type that is held in confidence by NorthStar Vallecitos, and there is a rational basis for doing so because the information contains sensitive financial competitive information.
- c. This information is being submitted to the NRC in confidence.
- d. This information has been marked in accordance with 10 CFR 2.390(b)(l).
- e. This information is not available in public sources and could not be readily gathered from other publicly available information.
- f. Public disclosure of this information would create substantial harm to the competitive position ofNorthStar Vallecitos by disclosing its internal commercial, financial and proprietary information to other parties whose commercial interests may be adverse to those ofNorthStar Vallecitos.
- 3. Accordingly, NorthStar Vallecitos requests that the designated documents be withheld from public disclosure pursuant to the policy reflected in 10 CFR 2.390(a)(4) and 10 CFR 9.17(a)(4).
- 4. The averments of fact set forth in this affidavit are true and correct to the best of my knowledge, information, and belief Exhibit A-3
- 5. I declare under penalty of perjury under the laws of the United States that the foregoing is true and co1Tect.
Executed on this :;y2ctay of August 2023 NorthStar Vallecitos, LLC
~ ~
Vice President, General Counsel & Secretary Exhibit A-4
EXHIBITB GENERAL COMPANY INFORMATION FOR GE-HITACHI NUCLEAR ENERGY AMERICAS, LLC NAME: GE-Hitachi Nuclear Energy Americas, LLC ADDRESS 3901 Castle Hayne Road Wilmington, NC 28401 STATE OF Delaware INCORPORATION: MANAGER Jay T. Wileman PRINCIPAL Jay T. Wileman - President & CEO OFFICERS Eric J. Fitzpatrick - CFO Bobbie T. Lockwood - Vice President, Reactor Facility Safety & Security Angela F. Thornhill - General Counsel and Secretary Exhibit B
EXHIBITC GENERAL COMPANY INFORMATION FOR NORTHSTAR VALLECITOS, LLC NAME: NorthStar Vallecitos, LLC ADDRESS 370 7th Avenue, Suite 1803 New York, NY 10001 STATE OF Delaware INCORPORATION: SOLE MEMBER: NorthStar Group Services, Inc. PRINCIPAL Scott E. State, P.E., CEO, CNO OFFICERS Jeffrey P. Adix, Vice President, CFO & Treasurer Gregory G. DiCarlo, Vice President, General Counsel & Secretary Kamal Sookram, Vice President Exhibit C-1
NAME: NorthStar Group Services, Inc. ADDRESS 370 7th Avenue, Suite 1803 New York, NY 10001 STATE OF Delaware INCORPORATION: MEMBERS OF Scott E. State BOARD OF C. Alexander Harman - Chairman DIRECTORS Glenn M. Shor PRINCIPAL Scott E. State: Chief Executive Officer and President OFFICERS Jeffrey P. Adix: Vice President, Chief Financial Officer
& Treasurer John M. Leonard: Vice President and Chief Operating Officer Gregory G. DiCarlo: Vice President and General Counsel Kamal Sookram: Vice President Gary Thibodeaux: Vice President - Health & Safety Glenn M. Shor: Assistant Secretary David L. Rattner: Secretary David F. Thomas: Assistant Secretary Exhibit C-2
EXHIBIT D-1 SIMPLIFIED ORGANIZATION CHART BEFORE THE TRANSFER Exhibit D-1
SIMPLIFIED ORGANIZATION CHART BEFORE THE TRANSFER Hitachi Ltd. General Electric Co. I Nuclear Fuel Holding Common Interest Co., Inc. Preferred Interest GENE Holding LLC Hitachi America Ltd. 60% 40% GE-Hitachi Nuclear Energy Holdings, LLC GE-Hitachi Nuclear Energy Americas, LLC Exhibit D-1
EXHIBIT D-2 SIMPLIFIED ORGANIZATION CHART AFTER THE TRANSFER Exhibit D-2
SIMPLIFIED ORGANIZATION CHART AFTER THE TRANSFER JFL Northstar Partners, LLC I NGS-WCS Group Holdings, LLC I Northstar Group Holdings, LLC I LVI Parent Corp. I Northstar Group Services, Inc. I Northstar Vallecitos, LLC Exhibit D-2
EXHIBITE PROJECT MANAGEMENT ORGANIZATION Scott E. State, P. E. Chief Nuclear Officer J CEO, CNO- Northstar Va llecitos 1 V 'II' David Carlson Gary Thibodeaux Billy Reid Special Projects Director of Health & Safety Decommissioning Corporate Support WCS, President & COO North Star, Vice President Program Manage r - Licensing/ Regu latory Support
£ - Quality Con t rol I - External Affairs/ Legal/ Co ntracts ~
- Accou nting/ Finance/ Payroll
- HR / Employee Concerns Luke Self - Information Technologies Deputy Program Manager Matthew Hooper
& Project Controls Project Manager
'"' A I I I I I I Responsible Facility Planning & NTR & HSF Bryant Akins Managers TBD Waste Manager Management Engineering Manager RAD Protection Manager VBWR, EVESR, GETR, NTR, Waste Contro l Specia li sts Electrical, HVAC, Mechanical Licensed SRO Hot Cel ls, SNM -960 Hillside Bunk er SNM Exhibit E
EXHIBITF RESUMES Scott E. State, P .E., Chief Nuclear Officer Summary of Qualifications CEO of two steadily growing and profitable facility and environmental services and radioactive waste disposal firms with over 4,000 employees. Extensive experience and strong educational background in technical management, strategic analysis, and finance in a high growth environment. Successful 35-year management and business development track record in commercial and government programs both domestically and abroad. Experience NorthStar Group Services, Inc. Chief Executive Officer & CNO - (2010 to Present) Waste Control Specialists (WCS) Chief Executive Officer & CNO - (2018 to Present)
- Direct all activities ofNorthStar and WCS operations worldwide.
- Major activities include demolition, abatement and waste disposal for projects involving commercial and government facilities containing hazardous and radiological materials.
- Provide direct oversite of all nuclear programs including decommissioning of nuclear facilities and remediation of DOE nuclear weapons sites.
US Development Group, LLC Chief Executive Officer - (2002 to 2010)
- Served as Program Director for the remediation of the Sunflower Army Ammunition Plant. This project involved a cleanup of a 9,000-acre former Defense facility in Kansas.
Oversaw project activities and provide leadership in dealing with technical and regulatory issues.
- Provided technical advice and management expertise to multiple remediation projects across the U.S. Assisted clients with making decisions on how to deal with environmental issues and structuring of insurance for transferring liabilities including development of the Zion nuclear power plant license transfer approach.
MACTEC, Inc (acquired by AMEC, now Wood Group), Golden, CO CEO and Chairman of the Board - (1993 to 2002)
- Developed MACTEC into a firm of about 4,000 staff providing environmental, nuclear waste management, engineering, and technical services to clients through a network of approximately 100 offices.
- Generated revenue of $500 million per year between 1996 and 2002 primarily in nuclear programs with DOE and commercial clients.
Exhibit F Page 1
- Directed multiple, successful re-capitalizations of the company including an ESOP buyout and two transactions with private equity sponsors raising over $100 million of equity capital and negotiated multiple syndicated credit agreements.
- Executed nine significant acquisitions, managed post-acquisition integration, and improved profitability of acquired companies.
Vice President
- Responsible for development and implementation of worldwide corporate programs to perform nuclear cleanup services with private and government clients. Managed all aspects of program; set strategies, developed teaming arrangements, and committed company resources to pursue and operate major programs.
- Re-engineered unfocused organization and implemented program to track and direct resources for all operations.
Dames & Moore, Inc (Now AECOM); Denver, CO Manager, Program Development - (1991 to 1993)
- Responsible for development and implementation of programs to conduct business with the Department of Energy and its major contractors.
- Performed strategic planning and corporate-wide market analysis for commercial and government clients. Evaluated environmental and engineering companies for acquisition.
Operations Manager
- Started, built, and managed engineering and environmental services business unit at Hanford site including all aspects of P/L, market analysis, contract negotiations, staffing, and strategic planning.
Siemens Corporation (now Orano) and various Electric Utility Organizations Project Manager and various engineering positions - (1983 to 1991)
- Responsible for reactor engineering, safety analysis, thermal hydraulics and designing new products and technologies, technical marketing, and licensing of advanced technologies and related nuclear services worldwide. Developed domestic and international business for advanced technologies.
Academic Background Master of Engineering Management, Washington State University Master of Engineering, Nuclear Engineering, Iowa State University Bachelor of Science, Nuclear Engineering, Iowa State University Clearances / License DoD Top Secret, DOE "Q" (inactive) Licensed Professional Engineer Exhibit F Page 2
Gary Thibodeaux, Director of Health and Safety- VP Northstar Summary of Experience / Areas of Specialization As Director of Health and Safety, Mr. Thibodeaux is responsible for the safety and compliance of all NorthStar Group Services, Inc. , and its subsidiary companies. Mr. Thibodeaux has extensive experience in all aspects of construction including demolition, environmental remediation, and disaster recovery. Mr. Thibodeaux's responsibilities include the development of policies and procedures to ensure the company operates in compliance with all applicable federal, state and local environmental and safety regulations. He also provides technical assistance in the area of safety and health to all management and operations personnel. Through the performance of branch office and job site audits he has assisted in the reduction of accidents and regulatory violations and citations by ensuring full compliance with our Corporate Safety Program and all applicable rules and regulations governing our industry. As the Director he develops and implements safety-training programs to enhance awareness to hazards associated with our industry. He is the company representative for NorthStar at meetings and hearings with regulatory agencies. Mr. Thibodeaux has over 30 years of experience as a safety and compliance officer in the demolition and asbestos/lead abatement industry. He has been certified to conduct training in Asbestos, OSHA Construction Standards, HAZWOPER and Scaffolding. He has been a guest speaker at safety training seminars since 1991 for various organizations. Professional Licenses/Organizations
- Asbestos Abatement Contractor/ Supervisor. M.E. T .A.
- Asbestos Abatement Project Designer. Texas A&M.
- Asbestos Air Monitoring, Stanley Engineering
- Air System Cleaning Specialist, NADCA ASCS# 09011399
- Certified Mold Remediator, IAQA CMR#00192
- Lead Abatement Supervisor/Contractor, Louisiana State University
- Train the Trainer in Health and Safety, Univ. of Illinois at Chicago
- HAZWOPER Train the Trainer, Brown and Root Environmental
- Scaffold Train the Trainer, Scaffold Training Institute, Houston, TX
- OSHA 500 Outreach Instructor, OSHA Training Institute, Chicago, IL Notable Nuclear Decommissioning Projects
- Vermont Yankee
- Crystal River
- University at Buffalo Material Research Center
- DOE Hanford 308-A/309 Reactors & 340 Waste Vault
- University of Illinois Nuclear Reactor Lab
- University of Arizona TRIGA Reactor & Lab
- University of Washington Nuclear Reactor
- J. Blotcky Reactor Facility Exhibit F Page 3
Notable Power Plant Decommissioning Projects NRG El Segundo Power Plant, El Segundo, CA. - Performed decommissioning of two 360 megawatt (MW) oil-fired steam generating units. NorthStar conducted abatement of asbestos-containing materials, including TSI, galbestos and transite siding, and the removal of interior boiler refractory from the 1,000,000 pound per hour steam boilers and ancillary equipment and structures. Dynegy South Bay Power Plant San Diego, CA. - The plant consisted of a boiler house with 4 100' tall boilers all containing asbestos. The asbestos abatement not only included the boilers but all associated equipment and pipping insulation and other regulated materials. Hunter' s Point Power Plant, San Francisco, CA - Managed the decontamination and decommissioning (D&D) of PG&E's 38-acre Hunters Point Power Plant, including asbestos abatement and demolition to grade of four boiler house units containing seven boilers, a backup jet-fueled turbine, a turbine house, storage tanks, administrative buildings, and six stacks ranging in height between 200 and 250 feet. Hunter' s point is one of the largest fossil fuel utility sites to be decontaminated and decommissioned in the U.S. Pepco Energy Services, Benning Road Generation Station, Washington, D.C. - The Dismantlement and Demolition of the Benning Road Generating Station involved the removal of the Steam turbines unit; units 10, 12,, 13, 14, 15 and 16 and the associated Mechanical Electrical and Plumbing support systems including the building structure and modification to the river water intakes and outlet structures (1000-megawatt facility). Work included Asbestos Abatement, Hazardous Materials removal, the termination and cut and cap of all utilities, removal of salvage materials, non-ferrous and ferrous and demolition of the interior structural steel framing, misc. iron grading, cribbing, stairs, electrical switchgear, equipment, masonry structures, exterior cladding, metal stacks masonry and concrete chimneys, Plug and terminate River intake and outlet water system, and backfill and grading entire site. Charles Poletti Power Plant, Astoria, Queens, NY - Demolition, Asbestos Abatement, Environmental remediation, including site restoration of New York Power Authority's 900MW Charles Poletti Power Generating facility. Removed the Boiler House, Turbine House, Intake Structure and related ancillary buildings which required an average crew of 45 workers to systematically remove 25 ,000 tons of structural steel and 15,000 tons of concrete and related debris, using both torch cutting and mechanical shearing methods to completely raze these structures at the site. Previous Employers
- NorthStar Group Services, Inc. , V.P. ; Director Health & Safety; 2002 - Present
- LVI Services Inc. (NorthStar), Regional Safety Manager; 2000 - 2001
- NSC Corporation, Director Health & Safety; 1992 - 1999
- BRAND Companies. Regional Safety Manager; 1989 - 1991
- Thermo-Tech. (Division of BRAND) Branch Safety Manger; 1987 - 1988 Exhibit F Page 4
David Carlson, Special Projects - WCS President & COO Strategically minded business leader with a consistent history of growing businesses, reducing costs, increasing profits, and providing clear organizational focus. Proven to be highly adaptable to a broad variety of roles and circumstances. Experience Highlights Over 25 years of nuclear experience spanning the range from reactor operations to reactor design to environmental cleanup, D&D and nuclear waste management. Senior executive skilled at motivating organizations and project teams to achieve success. Experience 2018-Current- President and COO, Waste Control Specialists Executive responsible for all aspects of operating a low-level radioactive waste disposal site including sales, finance, regulatory and government affairs, operations, and compliance. 2014-2017 - Senior Vice President, Veolia Nuclear (Kurion). Executive responsible for key Business Lines including liquid waste treatment, facility decommissioning, and vitrification.
- Led Business Development and Sales to government and commercial entities in Japan, United Kingdom, Canada, and the US.
- Accountable for P&L of business lines with full strategic and operational responsibility
- Personally, led a 9-month ($50 million+) tum-key nuclear-grade water treatment project (sell, design, build, license, operate) for Kurion at the TEPCO reactor site in Fukushima Japan in 2014.
- Conceptualized, designed, fabricated and commissioned first-of- a-kind water treatment equipment on an accelerated schedule, and successfully demonstrated tritium removal from contaminated water under a ¥1 billion grant from the METI.
2011-2014- Chief Operating Officer, Gen4 Energy. Innovative Startup formed to commercialize an advanced technology nuclear reactor that was developed at Los Alamos National Lab. Led the employee and contractor team responsible for design and licensing of the Gen4 Reactor.
- Defined market strategy, led R&D activities, engineering and design, and licensing.
- Coordinated with government officials in Canada and the US on licensing issues.
Exhibit F Page 5
2007-2010 - Chief Operating Officer, Aqua-Chem Manufacturer of water purification equipment for military, pharma, beverage, oil and gas, ships, and desalination. Recruited to identify and resolve sales and operational issues. Accountable for all aspects of manufacturing, product development, worldwide sales and marketing, quality, and financial performance. 2000-2007 - Chief Operating Officer, Duratek. Publicly traded company providing nuclear waste management services and disposal to nuclear utilities, commercial customers, and the federal government. Senior operating executive accountable for all aspects ofDuratek' s commercial operations and $150M annual budget. Provided leadership to 5 vice president level direct reports and 550 employees.
- Streamlined Duratek's commercial operations, reducing indirect costs $5M annually.
- Re-energized and refocused the organization on strategic and higher growth markets.
Profitably facilitated a deal that resulted in the acquisition of Duratek for $396M. 1995-1999 - Director, Idaho National Laboratory. Responsible for a $90M annual budget, leadership of 10 direct reports, and more than 500 fulltime and subcontract employees. Spearheaded completion of major environmental cleanup at multiple sites across the laboratory including groundwater, contaminated soils, and facility demolition and decommissioning on projects that were contaminated with hazardous waste, radioactive waste, and unexploded ordinance. Education
- BS, Mechanical Engineering, US Naval Academy, Annapolis, MD
- MS , Engineering Management, Catholic University of America, Washington, DC Exhibit F Page 6
Billy E. Reid, Jr., Decommissioning Program Manager Mr. Reid has extensive experience with the construction, modification and decommissioning of commercial and government nuclear facilities. He currently has Decommissioning Program Management Responsibility for NorthStar at Vermont Yankee and Crystal River. Mr. Reid has supported the site closure of nuclear facilities since 1991 serving in project and program management roles at the following facilities: Hanford, Rocky Flats, Fernald, Oak Ridge ETTP/ORNL, Paducah, Portsmouth, Savannah River Site (SRS), and Plant Vogtle. Experience Highlights Over 38 years of experience in the construction, modification, and decommissioning (closure) of nuclear facilities nationwide. Successfully lead the ownership transition teams for the Vermont Yankee and Crystal River Decommissioning Projects. Supported the Site Closures of the following DOE Sites; Fernald (accelerated the closure by two years), Rocky Flats (D&D of 771/774 once thought to be the most contaminated facility in the US due to PU), Hanford 300 Area North, Oak Ridge ETTP & ORNL major projects. Managed major Emergency Response projects for Ameren/VE & TV A. Education
- Bachelor of Science, Organizational Management, Tusculum College.
- Associates of Science, General Studies, Georgia Military College.
Training - Registrations/Certifications
- Project Management Professional- PMP #1418369
- Registered Environmental Manager REM #7912
- Certified Environmental Auditor CEA #6655 (inactive)
- USDOE 10 CFR 830/414.IC & NQA-1 Quality Assurance Certificate
- Currently Badged at the Vermont Yankee Nuclear Power Facility.
Experience 2012-Persent- VP/Program Manager, NorthStar Nuclear Decommissioning Company, LLC. Mr. Reid is currently responsible to provide the Program Leadership for the Ownership Transfer and Decommissioning of shutdown nuclear facilities nationwide. Mr. Reid's responsibilities with NorthStar have included the removal of the 308 TRIGA at Hanford and VA Blotcky Reactor removal in Omaha, NE. Mr. Reid is currently leading the decommissioning at Vermont Yankee and Crystal River Exhibit F Page 7
1999-2012 - VP/DDRS Division Manager, AMEC (MACTEC). Mr. Reid provided Division/Program management for the Remediation and nuclear D&D program, RADD Division nationwide - major projects included: D&D of nearly 100 highly contaminated structures at Fernald Closure Project, Oak Ridge Main Plant, Rocky Flats 771/774, SWSA-4, SRS Old TNX Seepage Basin Remediation & Closure, AmerenUE Taum Sauk Reservoir Breach Emergency Response & Restoration, TVA Kingston Fly Ash Recovery Load-out, and the Hanford 324 Hot Cell D&D (Design). 1998-1999 - Project Manager, AVISCO, Inc. Mr. Reid provided Project Management for the Scott Air Force Base; the project included remediation & restoration of an 18-acre site. 1991-1998 - Senior Construction Engineer, MK Ferguson As a Senior Construction Engineer Mr. Reid planned and executed more than $200M in remediation projects at 4 - DOE Sites in the Southeast US. 1991-1991 -Mechanical SME, Burns & Roe, SRS, Aiken, SC. Revised procedures for mechanical systems at P-Reactor. 1985-1990 -Mechanical SME, MK Ferguson, SRS. Mr. Reid supported the construction of the New Waste Transfer Facility (NWTF) and modification of critical systems within K, L & P Reactors and support areas at the DOE Savannah River Site, Aiken, SC. 1980-1985 - Seismic Piping Field Engineer, Pullman Power Products, Plant Vogtle. Installed piping and seismic supports in the Aux. & Control Buildings. Exhibit F Page 8
Matthew E. Hooper, Decommissioning Project Manager Mr. Hooper has over twenty-years ' experience delivering sustained technical expertise to the U.S. nuclear power industry across a wide range of disciplines. Areas of proficiency include D&D planning & project management, logistics planning & management, LLRW & irradiated hardware characterization, custom package design, software specification & development, and regulatory compliance & training. Major experience lies in strategizing and leading cross-functional teams to bring about fundamental change and improvement in strategy, process, and profitability - both as a leader and expert consultant. Education: BS Nuclear Engineering, 1998, Penn State University; University Park, PA Professional Experience: March 2019 to Present - NorthStar Nuclear Decommissioning Company, LLC & Waste Control Specialists - Vermont Yankee Transportation & Disposal Director (April 2019 to May 2022), Crystal River 3 Transportation & Disposal Director (June 2022 to present)
- Planning & coordination with D&D site management to integrate waste packaging, transport, and disposal requirements into site operations.
- Ensure packaging, transportation and disposal support & resources are delivered according to the project schedule & regulatory requirements.
- Oversee & manage all packaging and transportation resources, logistics, personnel, and subcontractors.
- Planning & coordination with LLRW disposal site operations and waste acceptance departments and personnel
- Manage project financials to include forecasting, expense & revenue tracking, invoicing
& subcontracts management.
April 1999 - February 2019 - WMG, Inc. - General Manager of Characterization Services & RADMAN Product Technical Manager
- WMG Project Manager for fuel pool clean-up projects at US commercial nuclear power plants. Technical support included project planning & execution, characterization &
classification of irradiated reactor components, submittal of documentation for regulatory approval, and generation documentation for LLRW transportation & disposal.
- Performed the reactor vessel and internals activation analysis and waste characterization to support decommissioning planning.
- Project Technical Manager for RADMAN Software Suite for shipment of radioactive materials & LLRW. Responsibilities include regulatory compliance, development of technical specifications and testing protocols.
- SME for WMG' s e-Shipper radioactive material shipping support services.
- Large component characterization & specialty package design.
- Regulatory awareness & software training course developer and instructor.
Exhibit F Page 9
Fall 1998 - Penn State Breazealle Nuclear Reactor - Research Assistant
- Performed the R&D for a two-dimensional neutron transport analysis of the PSU TRIGA reactor and Fast Neutron Irradiation Facility Summer 1998 - Westinghouse Electric Company - Summer Intern Summer 1995 Willamette Industries - Engineering Intern Exhibit F Page 10
Luke M. Self, Deputy Program Manager PROFESSIONAL EXPERIENCE Over 20 years of professional, hands-on industrial and commercial project execution and management experience. Expertise includes project management / project controls responsibility for the decommissioning of Vermont Yankee and Crystal. Duties include planning and scheduling, project budget development, tracking/reporting, and program management level regulatory support for complex nuclear decommissioning projects. Experience extends to complex project proposal development, estimating and corporate development support. Professional experience is enhanced by solid field and industrial experience with excellent work ethic and motivation. NorthStar Group Services, Inc. (Aug 2013 to Present) Deputy Program Manager / Project Controls Manager, NorthStar Nuclear Decommissioning Company, LLC
- Key member of the due diligence, project transition and project execution team for both Vermont Yankee and Crystal River decommissioning projects. Support proposal development for all NorthStar decommissioning opportunities. Provide executive and program management level support for all decommissioning project cost accounting, project reporting, project scheduling and the annual decommissioning project budgeting.
- Mr. Selfs 10+ year tenure at NorthStar has included the following assignments:
Project Manager
- Responsible for providing project management assistance to ensure for profitable performance and safe supervision of all projects, including project execution, adherence to project scope of work and specifications, identification of out-of-scope work, as well as monitoring, controlling, and closing a project, controlling project scope, accurate reporting of all aspects of the project, project scheduling, planning and identification of project risk.
Estimating/Scheduling
- Responsibilities include estimating, scheduling, invoicing, job tracking and oversight of field foreman and field supervisors on construction projects. Develop change notice proposals and participate in negotiations for settlement of change proposals.
Prepare proposal documents in response to requests for proposals. Exhibit F Page 11
Field Work/Safety Supervisor
- Assigned to Construction Projects as fieldwork and safety supervisor. Responsibilities included working with various building trades personnel and professional staff to ensure safe performance of construction operations and implementation of safety standards and specifications. work being managed. Worked closely with DOE client to ensure product being delivered exceeds expectations.
Phoenix Enterprises NW, LLC, Richland, WA - (2010 to 2013) Project Support Manager
- Responsible for managing field support activities for all projects; ensure availability of materials, equipment, and labor to facilitate effective and timely project completion.
Responsibilities also include estimating, scheduling, invoicing, job tracking and oversight of field foreman and field supervisors on construction projects. Develop change notice proposals and participate in negotiations for settlement of change proposals. Pursue business development opportunities and prepare proposal documents in response to requests for proposals. Work closely with owner and other corporate staff to ensure effective day to day operations of the company. Project Controls/Scheduling
- Assigned to perform project controls and scheduling activities in support of a complex 308/309/340 Reactor and Vault Removal project. Developed and maintained detailed and dynamic project schedule to support customer milestones and ensure project integration and schedule management.
Superintendent
- Worked on various projects on a DOE site as a superintendent prior to promotion to Project Support Manager based on performance. Responsibilities included supervising various building trades personnel and professional staff to ensure safe performance of construction operations and implementation of safety standards and specifications.
Ray Poland & Sons, Inc., Richland, WA - (2004-2010) Field Labor/Work Supervisor
- Worked on various construction and demolition projects as supervisor, operator, laborer and welder performing all aspects of general construction and demolition activities including underground piping, concrete, excavation operations, asphalt, maintenance, and all phases of civil site work. Operated heavy equipment during all phases of construction and have gained the experience necessary to be comfortable operating in and around heavy equipment with confidence. Worked with state and local entities to ensure field activities (earth, concrete, welds) were tested according to site standard. Experienced all aspects of construction, under all different conditions and regulations, and always able to complete the job in a safe, professional and timely manner.
United States Army, Fort Benning, GA- (2001-2004) Exhibit F Page 12
Airborne Ranger
- Performed in Military Special Operations community as an Airborne Ranger deploying three times to fight the Global War on Terrorism in support of Operation Iraqi Freedom, and Operation Enduring Freedom. Received extensive training in light infantry tactics, urban warfare, force protection, and Airborne Operations. Received awards and recognition for outstanding performance and professionalism.
Self-Start Landscape, Kennewick, WA - (1995-2001) Landscaper/Foreman
- Responsible for supervising up to six crew members on City, State, and federal jobs.
Performed as liaison between city inspectors, crew members, and sub-contractors to safely complete jobs in a professional timely manner. Responsible for meeting completion dates and deadlines on all city and federal jobs. PROFESSIONAL DEVELOPMENT Education & Training
- Kennewick High School (High School Diploma 2000)
- Airborne Course, Fort Benning, GA 2002
- Ranger Advanced Leadership, Fort Benning, GA, and Elgin Air Force Base, 2003
- Basic Training, Fort Benning, GA 2002
- Primavera (P6) Proficient, Certificate
- Radiation Worker II, Dept of Energy
- Excavation Competent Person
- Hazardous Waste Operations 40-Hour
- OSHA 10&30-Hour, Certificate
- Respirator/Mask Fit Accomplishments
- U.S. Army Commendation Medal- Iraq -Department of Defense, May 2004
- Several Medals and honors with 3rd Ranger Battalion during Operation Enduring Freedom and Operation Iraqi Freedom.
- U.S. Army Commendation Medal -Afghanistan, - Department of Defense, 2002 Exhibit F Page 13
Leon Bryant Akins, Jr., RAD Protection Manager
SUMMARY
OF QUALIFICATIONS Senior Radiation Protection and Chemistry Manager with over 40 years of nuclear experience in the commercial nuclear power plant industry. Skilled in Radiation Protection program implementation, management, and oversight. Experienced at nuclear power plant operations, nuclear plant project management, transition from shutdown to SAFSTOR plant status, and nuclear plant decontamination and decommissioning. PROFESSIONAL EXPERIENCE: NorthStar Nuclear Decommissioning, LLC - (2020 - Current) Senior Radiation Protection and Chemistry Manager
- Crystal /River Nuclear Plant Decontamination/Decommissioning.
Duke Energy - (2013 - 2020) Radiation Protection and Chemistry Manager
- Crystal River Nuclear Plant shutdown to SAFSTOR transition.
Progress Energy - (2006 - 2013) Radiation Protection Manager
- Crystal River Nuclear Plant operations.
Radiation Protection Specialist and Supervisor ( 1999-2006)
- Crystal River Nuclear Plant operations Radiation Protection Technician and Project Supervisor (1986 - 1999)
- Crystal River Nuclear Plant operations Contract Radiation Protection Technician Support - (1981-1986)
- Crystal River Nuclear plant and several nuclear power plants.
EDUCATION:
- Bachelor of Science Technology (Nuclear), Regents College, University of State of New York
- Associate of Science Radiation Protection Technology, Central Florida College, Ocala, Florida
- Associate of Arts Pre-Engineering, Santa Fe Community College, Gainesville, Florida Exhibit F Page 14
CERTIFICATES AND PROFESSIONAL TRAINING Institute of Nuclear Power Operations (INPO)
- Accredited training in Nuclear Power Plant Management, Supervision, Project Management, Human Error Reduction Techniques - (2000-2013)
Certificate Hazardous Waste Coordinator and Site Generator - (2000) National Registration of Radiation Protection Technologists (NRRPT) - (1998) Chairman of Crystal River Nuclear Plant Safety Committee - (1996-2000)
- Occupation Health and Safety Technologist (OHST) certification Exhibit F Page 15
Confidential Proprietary Information - Withhold from Disclosure Pursuant to JO CFR 2.390 EXHIBITG ASSET PURCHASE AND SALE AGREEMENT (Proprietary) Exhibit G
EXHIBITH ASSET PURCHASE AND SALE AGREEMENT (Redacted) Exhibit H
ASSET PURCHASE AND SALE AGREEMENT BY AND AMONG GENERAL ELECTRIC COMPANY, GE-HITACHI NUCLEAR ENERGY AMERICAS LLC AND NORTHSTAR D&D, LLC DATED AS OF May 8, 2023 4858-895 5-7603.v l
Table of Contents Page ARTICLE I DEFINITIONS .......................................................................................................... 1 1.1 Definitions .............................................................................................................. 1 1.2 Certain Interpretive Matters ................................................................................. 19 ARTICLE II PURCHASE AND SALE ...................................................................................... 20 2.1 Assets ................................................................................................................... 20 2 .2 Excluded Assets ................................................................................................... 21 2.3 Assumed Liabilities and Obligations ................................................................... 23 2.4 Excluded Liabilities ............................................................................................. 24 2.5 Control of Litigation After Closing ..................................................................... 25 2.6 Parent Guaranty ................................................................................................... 26 ARTICLE III THE CLOSING ..................................................................................................... 26 3.1 Closing ................................................................................................................. 26 3 .2 Purchase Price ...................................................................................................... 26 3 .3 Deliveries by Sellers ............................................................................................ 26 3.4 Deliveries by Buyer ............................................................................................. 27 ARTICLE IV REPRESENTATIONS AND WARRANTIES OF SELLERS ............................ 28 4.1 Organization ......................................................................................................... 28 4.2 Authority .............................................................................................................. 29 4.3 Consents and Approvals; No Violation .................................. ............................. 29 4.4 Reports ................................................................................................................. 31 4.5 Absence of Seller Material Adverse Effect ......................................................... 31 4.6 Title and Related Matters ..................................................................................... 31
- 4. 7 Real Property Agreements ................................................................................... 31 4.8 Insurance ................................................. ................................ ............................. 32 4.9 Environmental Matters ......................................................................................... 32 4 .10 Certain Contracts and Arrangements ................................................................... 33 4.11 Legal Proceedings ................................................................................................ 34 4.12 Permits; Compliance with Applicable Laws ........................................................ 34 4.13 NRC Licenses ......................................... ................................ ............................. 35 4.14 California Licenses .............................................................................................. 35 4.15 Tax Matters .......................................................................................................... 35 4858-8955-7603.v l
Table of Contents (continued) Page 4.16 NDF .......................... ................ ........................ ................................ .................... 36 4.17 Payment of Fees ................................................................................................... 36 4 .18 Exclusivity of Representations and Warranties ................................................... 37 ARTICLE V REPRESENTATIONS AND WARRANTIES OF BUYER ..... .. ...... .. .................. 37 5.1 Organization; Qualification ................................................................................. 37 5.2 Buyer Capability .................................................................................................. 37 5.3 Authority .............................................................................................................. 37 5.4 Membership Interests ........................................................................................... 38 5.5 Consents and Approvals; No Violation .................................. ............................. 38 5.6 Legal Proceedings ................................................................................................ 38 5.7 Absence of Buyer Material Adverse Effect; Liabilities ....................................... 39 5.8 Transfer of Decommissioning Funds ....... .. ...... .. ...................... .. ...... .. .................. 39 5.9 Foreign Ownership or Control.. ........................................................................... 39 5.10 Permit Qualifications ........................................................................................... 39 5.11 Buyer's Reliance .................................................................................................. 39 ARTICLE VI COVENANTS OF THE PARTIES ...................................................................... 39 6.1 Sellers' Conduct of Business Relating to the Assets .............. ............................. 39 6.2 Buyer's Conduct of Business ............................................................................... 41 6.3 Access to Information .......................................................................................... 42 6.4 Protection of Proprietary Information ..... ......... ................................ .................... 43 6.5 Expenses .............................................................................................................. 45 6.6 Further Assurances; Cooperation ......................................................................... 45 6.7 Public Statements ................................................................................................. 46 6.8 Consents and Approvals ...................................................................................... 46 6.9 Brokerage Fees and Commissions ................... ................................ .................... 50 6.10 Tax Matters .......................................................................................................... 51 6.11 Real Property Transfer Matters ............................................................................ 54 6.12 Payment of Real Estate Sale Proceeds ................................................................. 55 6.13 Decommissioning Funds ...................................................................................... 56 4858-8955-7603.v l
Table of Contents (continued) Page 6.14 Pre-Closing Decommissioning Activities ............................................................ 56 6.15 Cooperation Relating to Nuclear Insurance Policies and Price-Anderson Act ........................................................................................................................ 57 6.16 NRC Commitments .............................................................................................. 57 6.17 Decommissioning ................................................................................................ 57 6.18 Insurance Policies .................................... .. ...... .. ...................... .. ...... .. .................. 57 6.19 California Governmental Authorities .................................................................. 59 6.20 Rights to GE Names and GE Marks .................................................................... 60 6.21 Notification of Significant Changes ..................................................................... 60 6.22 Data Room ........................................................................................................... 60 6.23 Performance Deed of Trust.. ................... ................................ ............................. 60 ARTICLE VII CONDITIONS ..................................................................................................... 61 7 .1 Conditions to Obligations of Buyer ..................................................................... 61 7 .2 Conditions to Obligations of Sellers ........ .. ...... .. ...................... .. ...... .. ............. ..... 62 7.3 Frustrating of Closing Conditions ........................................................................ 63 ARTICLE VIII INDEMNIFICATION ........................................................................................ 63 8.1 Indemnification .................................................................................................... 63 8.2 Defense of Claims ................................................................................................ 65 ARTICLE IX TERMINATION ................................................................................................... 66 9.1 Termination .......................................................................................................... 66 9.2 Effect of Termination ........................................................................................... 68 ARTICLE X MISCELLANEOUS PROVISIONS ...................................................................... 68 10 .1 Amendment and Modification ............................................................................. 68 10.2 Waiver of Compliance; Consents ........................................................................ 68 10.3 Survival of Representations, Warranties, Covenants and Obligations ................ 69 10.4 Notices ................................................................................................................. 69 10.5 No Third Party Beneficiaries ........................... ................................ .................... 71 10.6 Assignment .......................................................................................................... 71
- 10. 7 Governing Law; Jurisdiction; Venue ................................................................... 71
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Table of Contents (continued) Page 10.8 Counterparts .................... ........................ ................................ ............................. 72 10.9 Schedules ............................................................................................................. 72 10 .10 Entire Agreement ................................................................................................. 72 10 .11 Acknowledgment; Independent Due Diligence .............. .. ...... .. ...................... .. ... 73 10.12 Bulk Sales Laws ................................................................................................... 74 10.13 No Joint Venture .................................................................................................. 74 10.14 Change in Law ..................................................................................................... 74 10 .15 Severability .......................................................................................................... 74 10 .16 Specific Performance .............................. ................................ ............................. 74 10.17 Appointment of Representative ........................................................................... 74 10.18 Non-Recourse ...................................................................................................... 75
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EXHIBITS Exhibit A Form of Assignment and Assumption Agreement Exhibit B Form of Bill of Sale Exhibit C Decommissioning Completion Agreement Exhibit D [Reserved] Exhibit E Form of Investment Management Agreement Exhibit F Form of Deed Exhibit G Form of Parent Guaranty Exhibit H Form of Financial Support Agreement Exhibit I Form of Disposal Guarantee Exhibit J Form of Performance Deed of Trust Exhibit K Right of First Negotiation Agreement SCHEDULES Sellers' Disclosure Schedules Schedule 1.1.(b) Sellers' Knowledge Persons Schedule 1.1 (c) Pre-Closing Permitted Encumbrances Schedule 2.1.9 Assumed Contracts Schedule 2.2.4 Excluded Assets Schedule 2.3.4 Outstanding Commitments and Agreements Schedule 2.4.8 Excluded Liabilities Schedule 4.3.1 Consents Schedule 4.3.3 GE Required Regulatory Approvals Schedule 4.3.4 GEH Required Regulatory Approvals Schedule 4.5 Seller Material Adverse Effect Schedule 4.6 Fee Real Property Schedule 4.6.2 Outstanding Options, Rights of First Offer or Refusal and Presumptive Rights in Favor of Third-Parties Schedule 4.7 Real Property Agreements Schedule 4.8 Insurance Policies Schedule 4.9.1 Environmental Permits Schedule 4.9.2 Environmental Matters Schedule 4.10.1 VNC Contracts Schedule 4.10.3 Breach ofVNC Contracts Schedule 4.10.5 VNC Leases Schedule 4.12.2 Permits Schedule 4.14 California Licenses Schedule 4.15 Tax Matters Schedule 6.1.1 Sellers' Pre-Closing Conduct
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Schedule 6.1.2 Sellers' Pre-Closing Commercially Reasonable Efforts Schedule 6.11.1 Title Policy Schedule 6.14 Pre-Closing Decommissioning Activities Schedule 6.18.3 Available Insurance Policies Schedule 7.2.10 Required Consent for Conditions to Obligations of Sellers Buyer Disclosure Schedules Schedule 1.1.(a) Buyer's Knowledge Persons Schedule 5.5.2 Buyer's Required Regulatory Approvals Schedule 5. 7 Buyer Material Adverse Effect vi 4858-8955-7603.v l
ASSET PURCHASE AND SALE AGREEMENT THIS ASSET PURCHASE AND SALE AGREEMENT is made and entered into this 8th day of May, 2023 (the "Contract Date"), by and among GENERAL ELECTRIC COMPANY, a New York company ("GE"), GE-HITACHI NUCLEAR ENERGY AMERICAS LLC, a Delaware limited liability company ("GEH") (GE and GEH each a "Seller," and collectively, "Sellers"), and NorthStar D&D, LLC, a Delaware limited liability company ("Buyer"). Sellers and Buyer are referred to individually as a "Efil!v" and collectively as the "Parties." RECITALS WHEREAS , GEH is the owner of one hundred percent (100%) of the Vallecitos Nuclear Center, consisting of the individual Vallecitos Licensed Facilities, located in Sunol, CA, and certain other Assets associated therewith and ancillary thereto; WHEREAS, GEH is the holder of the NRC Licenses and the California License for the Vallecitos Licensed Facilities; WHEREAS , GE is the owner of one hundred percent (100%) of the fee title interest to the Fee Real Property on which the Vallecitos Licensed Facilities are located; and WHEREAS , Buyer desires to purchase and assume, and Sellers desire to sell and assign, the Assets (as defined below) and certain associated liabilities, including the obligation for the Decommissioning (as defined below) of the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center, upon the terms and conditions set forth in this Agreement. NOW, THEREFORE, in consideration of the mutual covenants, representations, warranties and agreements hereinafter set forth, and intending to be legally bound hereby, the Parties agree as follows : ARTICLE I DEFINITIONS 1.1 Definitions. As used in this Agreement, the following terms have the meanings specified in this Section 1.1.
"Acceptable Institution" means a commercial bank or trust company incorporated under the laws of the United States or any state thereof, with an office or branch in New York, New York, with an aggregate capital surplus in excess of $25 ,000,000,000, and with senior unsecured debt rated at least "A-" by S&P Global Ratings or its successor, and "A3 " by Moody's Investors Service, Inc. , or such other financial institution that is reasonably acceptable to the Sellers. Sellers and Buyer acknowledge and agree that as of the Contract Date, each of The Bank of New York Mellon Corporation, Wilmington Trust Company, and JPMorgan Chase Bank, N.A. are Acceptable Institutions.
"Affiliate" means those Persons that, directly or indirectly, through one or more intermediaries, now or hereafter, own or control, are owned or controlled by, or are under common ownership or control with a Party, where "control" (including the terms "controlled by" and "under 1
4858-895 5-7603.vl
common control with") means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ownership of stock or other securities, as trustee or executor, by contract or credit arrangement or otherwise: provided that, for purposes of this Agreement and the Ancillary Agreements, Hitachi Ltd. and Hitachi GE Nuclear Energy Japan Co. Ltd. shall not be considered Affiliates of either Seller.
"Agreement" means this Asset Purchase and Sale Agreement together with the Schedules and Exhibits attached hereto, each of which is incorporated herein in its entirety by this reference, as the same may be amended in accordance with the terms hereof from time to time.
"Ancillary Agreements" means the Decommissioning Completion Agreement, the Parent Guaranty, the NDF Trust Agreement, the Investment Management Agreement, the Assignment and Assumption Agreement, the Bill of Sale, the Deed, the Financial Support Agreement, the Disposal Guarantee, the Performance Deed of Trust, the Right of First Negotiation Agreement, and any other agreement between or among Sellers or an Affiliate of Sellers on the one hand, and Buyer or an Affiliate of Buyer, on the other hand, contemplated by this Agreement or the Decommissioning Completion Agreement.
"ANI" means American Nuclear Insurers, or any successors thereto.
"Asset-Level Taxes" means those Taxes imposed by any Governmental Authority with respect to the ownership, operation, maintenance, sale, possession, lease, or use of the Assets (including any assets in the NDF) or the ownership or operation of the Vallecitos Nuclear Center and Vallecitos Licensed Facilities.
"Assets" has the meaning set forth in Section 2.1 .
"Assignment and Assumption Agreement" means the Assignment and Assumption Agreement between GEH and Buyer in the form attached hereto as Exhibit A.
"Assumed Contracts" has the meaning set forth in Section 2.1.9.
"Assumed Liabilities" has the meaning set forth in Section 2.3.
"Atomic Energy Act" means the Atomic Energy Act of 1954, as amended, 42 U.S.C.
§ 2011 et seq.
"Available Insurance Policies" has the meaning set forth in Section 6.18.3 .
"Benefit Plan" means an "employee benefit plan" as defined in Section 3(3) of ERISA, and, whether or not subject to ERISA, each written bonus, employment, deferred compensation, incentive compensation, stock purchase, restricted stock, stock option, or other equity-based compensation, severance, retention or termination pay, fringe benefit, education reimbursement, vacation or holiday pay, welfare, cafeteria, flexible spending, hospitalization or other medical, 2
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dental, vision life, disability, accident or other insurance, supplemental unemployment benefits, savings, profit-sharing, pension, or retirement plan, program, agreement or arrangement, and each other material employee benefit plan, program, policy, agreement or arrangement, in each case that is sponsored, maintained or contributed to, or required to be contributed to, by a Seller or any entity that, prior to the Closing Date, is an ERISA Affiliate of a Seller.
"Bill of Sale" means the Bill of Sale, in the form attached hereto as Exhibit B.
"Business Day" means any day other than Saturday, Sunday, and any day on which banking institutions in the State of New York or the State of California are authorized by Law or other governmental action to close.
"Buyer" has the meaning set forth in the preamble.
"Buyer Indemnitee" has the meaning set forth in Section 8 .1.2.
"Buyer Material Adverse Effect" has the meaning set forth in Section 5 .5. 1.
"Buyer Parties" means Buyer, the Parent Guarantor, each of their Affiliates, and their respective members, stockholders, managers, officers, directors, employees, agents, successors, and assigns.
"Buyer Proprietary Information" means (i) all drawings, reports, data, materials, or other information relating to Buyer's plans, actual or proposed, for the possession, operation and maintenance and Decommissioning of the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center; (ii) any financial, operational or other information concerning Buyer or its Affiliates or their respective assets and properties, including geologic, geophysical, scientific or other technical information, and know-how, inventions and trade secrets whether provided before or after the Contract Date, whether oral, written, or in electronic or digital media, and regardless of the manner in which it is furnished, that is provided by or on behalf of Buyer or its respective Representatives to Sellers or their Representatives; and (iii) any Third-Party Proprietary Information: provided that, Buyer Proprietary Information does not include any such information which (a) is or becomes generally available to the public other than as a result of a disclosure by Sellers or their Representatives; (b) was available to Sellers or their Representatives on a non-confidential basis prior to its disclosure by Buyer or its respective Representatives; (c) becomes available to Sellers or their Representatives on a non-confidential basis from a Person other than Buyer or its respective Representatives who is not, to the knowledge of Sellers, otherwise bound by a confidentiality agreement with Buyer or its Representatives or is otherwise not, to the knowledge of Sellers, under any obligation to Buyer or its Representatives not to transmit the information to Sellers or their Representatives; (d) was independently developed by Sellers or their Representatives without reference to or reliance upon Buyer Proprietary Information; or (e) is disclosed pursuant to any other agreement between Buyer and Sellers or their respective Affiliates (excluding the Ancillary Agreements).
"Buyer Tax Contest" has the meaning set forth in Section 6.10.8.3.
"Buyer-Prepared Tax Return" has the meaning set forth in Section 6.10.2.
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"Buyer's Required Regulatory Approvals" means the regulatory approvals identified in Schedule 5.5.2 "Byproduct Material" means any radioactive material (except Special Nuclear Material) yielded in, or made radioactive by, exposure to the radiation incident to the process of producing or utilizing Special Nuclear Material.
"California Authority" means a Governmental Authority organized under the Laws of the State of California.
"California License" means California Department of Public Health License No. 0017-01 issued by the State of California Department of Public Health governing the Vallecitos Nuclear Center and any other consent or approval from the State of California for the possession of Byproduct Material and Special Nuclear Material at the Vallecitos Nuclear Center.
"Characterization Reports" means environmental investigation and monitoring reports and assessments for the Real Property provided in the Data Room and listed on Schedule 4.9.2.
"Closing" has the meaning set forth in Section 3 .1.
"Closing Date" has the meaning set forth in Section 3 .1.
"Code" means the Internal Revenue Code of 1986, as amended, and the rules and regulations promulgated thereunder.
"Commercially Reasonable Efforts" mean efforts which are designed to enable a Party, directly or indirectly, to expeditiously satisfy a condition to, or otherwise assist in the consummation of, the transactions or activities contemplated by this Agreement and which do not require the performing Party to commence or participate in any litigation, offer or grant any accommodation, expend any funds or assume Liabilities other than expenditures and Liability assumptions which are customary and reasonable in nature and amount in the context of the transactions or activities contemplated by this Agreement.
"Confidentiality Agreement" means the Proprietary Information Agreement dated as of April 22, 2022.
"Consolidated Interim Storage Facility" means a facility licensed by the NRC not located at the Vallecitos Nuclear Center that is designed and constructed for the interim storage of Spent Nuclear Fuel, GTCC, and/or HL W.
"Contract Date" has the meaning set forth in the preamble.
"Contracting Parties" has the meaning set forth in Section 10 .18.
"Data Room" means the electronic data room hosted by Datasite and maintained by Sellers in connection with the transactions contemplated by this Agreement.
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"Decommission" and "Decommissioning" means, in compliance with applicable Laws, (i) the retirement, dismantlement and removal of the Vallecitos Licensed Facilities, decontamination of the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center, including Spent Nuclear Fuel and HLW management, and the reduction or removal of radioactivity at the Vallecitos Nuclear Center or around the Vallecitos Nuclear Center to a level that permits the release of all of the Vallecitos Nuclear Center for unrestricted use, as defined in 10 C.F.R.
§ 20.1402 ; (ii) the removal of all of the Spent Nuclear Fuel, GTCC, and HLW from the Vallecitos Nuclear Center and transportation to either (1) a Consolidated Interim Storage Facility pending transfer of title to the DOE, or (2) the DOE along with the direct transfer of title to DOE; (iii) termination of the NRC Licenses by the NRC and the California License by the California Department of Health; (iv) Remediation and removal of all Hazardous Substances in, on, at, under, or migrating from the Vallecitos Nuclear Center, to the extent required by Law; and (v) any planning and administrative activities incidental thereto .
"Decommissioning Completion Agreement" means the Decommissioning Completion Agreement in the form attached hereto as Exhibit C, to be entered into by Buyer and Sellers at the Closing.
"Decommissioning Liabilities" has the meaning set forth in Section 2.3.2.
"Decommissioning Project Schedule" means a level 3 or better project schedule for the work to Decommission the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center.
"Deed" means the grant deed in the form attached hereto as Exhibit F which shall, inter alia, prevent use of the Real Property located at the Vallecitos Nuclear Center as (a) a residence, including any mobile home or factory-built housing, constructed or installed for use as permanently occupied human habitation, other than those used for industrial purposes, (b) a hospital for humans, (c) a public or private school for persons under 21 years of age, and (d) a daycare center for children. In addition, the drilling for any water, oil, or gas and the extraction of groundwater for any purpose, shall be prohibited.
"Department of Energy" or "DOE" means the United States Department of Energy and any successor agency thereto.
"Direct Claim" has the meaning set forth in Section 8.2.4.
"Disposal Guarantee" means a guarantee in favor of the Trustee of the Standby and Provisional Trust Fund pursuant to which the Disposal Guarantor guarantees disposal at the Disposal Guarantor's Andrews County, Texas facility for the disposal of any or all of the Low-Level Waste at the Vallecitos Nuclear Center and in the Hillside Storage Facility that is compliant with the waste acceptance criteria for Disposal Guarantor's Andrews County, Texas facility, in the form attached hereto as Exhibit I.
"Disposal Guarantor" means Waste Control Specialists, LLC, a Delaware limited liability company.
5 4858-8955-7603.vl
"Disposition Event" means the sale by Buyer, or an Affiliate of Buyer, after the Closing Date, (i) of all or any portion of the Fee Real Property to a third party, or (ii) of equity in any entity which owns, as its principal asset, all or part of the Fee Real Property, whether such sale is direct or indirect, to a third party.
"DOE Decontamination and Decommissioning Fees" means all fees related to the Department of Energy's Special Assessment of utilities for the Uranium Enrichment Decontamination and Decommissioning Funds pursuant to Sections 1801 , 1802 and 1803 of the Atomic Energy Act and the Department of Energy's implementing regulations at 10 C.F.R.
Part 766, as those statutes and regulations exist at the time of execution of this Agreement, applicable to separate work units purchased from the Department of Energy in order to decontaminate and decommission the Department of Energy' s gaseous diffusion enrichment facilities .
"Encumbrances" means any mortgages, pledges, liens, security interests, conditional and installment sale agreements, activity and use limitations, conservation easements, deed restrictions, easements, charges and other encumbrances of any kind.
"Energy Reorganization Act" means the Energy Reorganization Act of 1974, as amended, 42 U.S.C. §§ 5801 et seq.
"Environment" means all soil, air, water (including surface waters, streams, ponds, drainage basins and wetlands), groundwater, water body sediments, drinking water supply, stream sediments or land, including land surface or subsurface strata, including all fish, plant, wildlife, and other biota and any other environmental medium or natural resource.
"Environmental Claim" means any and all actions, suits, investigations, orders, liens, complaints, demands, notices, including notices of violations of Environmental Laws, requests for information relating to the Release or threatened Release of Hazardous Substances into the Environment, proceedings, or other written communications, pursuant to or relating to any applicable Environmental Law by or before any Governmental Authority based upon, alleging, asserting, or claiming any actual or potential, and whether civil, criminal or administrative:
(i) violation of, or Liability under any Environmental Laws; (ii) violation of any Environmental Permit; or (iii) Liability for investigatory costs, cleanup costs, removal costs, remedial costs, response costs, monitoring costs, natural resource damages, property damage, diminution of property value, personal injury, fines , or penalties arising out of, based on, resulting from, or related to the actual or alleged presence, Release, or threatened Release into the Environment of any Hazardous Substances.
"Environmental Laws" means all Laws, other than Nuclear Laws, regarding pollution or protection of the Environment or human health (as it relates to exposure to Hazardous Substances),
the conservation and management of natural resources and wildlife, including Laws relating to the manufacture, management, distribution, use, treatment, storage, Release, transport, disposal or handling of Hazardous Substances, including the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. § 9601 et seq. , the Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq., the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq., the Clean Air Act, 42 U.S.C. § 7401 et seq., the Federal Water Pollution Control Act, 6 4858-895 5-7603.vl
33 U.S.C. § 1251 et seq., and the Emergency Planning & Community Right-to-Know Act, 42 U.S.C. § 11001 et seq. , but not including Nuclear Laws.
"Environmental Permit" means any federal, state or local permits, licenses, approvals, consents, registrations or authorizations required by any Governmental Authority with respect to the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center under or in connection with any Environmental Law, including any and all orders, consent orders or binding agreements issued or entered into by or with a Governmental Authority under any applicable Environmental Law, but excluding the California License and the NRC Licenses.
"ERISA" means the Employee Retirement Income Security Act of 1974, as amended, and the applicable rules and regulations promulgated thereunder.
"ERISA Affiliate" has the meaning set forth in Section 2.4.3.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Excluded Assets" has the meaning set forth in Section 2.2.
"Excluded Liabilities" has the meaning set forth in Section 2.4.
"Federal Trade Commission" means the United States Federal Trade Commission or any successor agency thereto.
"Fee Real Property" means the real estate more particularly described in Schedule 4.6.
"Financial Support Agreement" means the agreement by and between Buyer and the Parent Guarantor in the form attached hereto as Exhibit H, whereby the Parent Guarantor a ~
rovide u to a s ecified amount of fundin to Bu er in an amount equal to the sum of [ -
]
"Fraud" means, with respect to a Party, any action or inaction of such Party that constitutes common law fraud under the Laws of the State of New York. For the avoidance of doubt, Fraud shall not include negligent misrepresentation or negligent omission.
7 4858-8955-7603.vl
"GAAP" means accounting principles generally accepted in the U.S. , consistently applied.
"GE" has the meaning set forth in the Preamble.
"GE Names and GE Marks" means the names or marks owned, licensed or used by GE, any Seller or any of their respective Affiliates, including names that use or contain "GE" (in block letters or otherwise), the GE monogram, "General Electric Company", "General Electric",
"Hitachi" (in block letters or otherwise), "Hitachi Ltd.", "GE-Hitachi Nuclear Energy Americas LLC", "GE Vernova", or "GEH", either alone or in combination with other words and all marks, trade dress, logos, monograms, domain names and other source identifiers confusingly similar to or embodying any of the foregoing either alone or in combination with other words.
"GE Vernova" means an entity that (A) is a direct or indirect subsidiary of General Electric Company at the time of such assignment and assumption, (B) has succeeded to ownership, directly or indirectly, of substantially all of the assets formerly owned by the GE Power, GE Renewable Energy and GE Digital operating business units of General Electric Company and (C) is at the time of such assignment and assumption, or will be thereafter, a listed entity.
"GEH" has the meaning set forth in the Preamble.
"GEH Standard Spent Fuel Disposal Contract" means the U.S. Department of Energy Contract No. CR01-83NE44426 Contract for Disposal of Spent Nuclear Fuel and/or High-Level Radioactive Waste dated as of June 29, 1983, by and between the DOE and GE, as assigned to GEH effective October 22, 2007.
"Good Industry Practices" means any of the practices, methods and activities generally accepted by a significant portion of the nuclear industry in the United States of America during recent time periods as good practices applicable to nuclear reactors that have ceased operating or will cease operating in anticipation of decommissioning and which, in light of the facts known at the time the decision was made, would have been reasonably expected to accomplish the desired result at a reasonable cost in a manner consistent with good business practices, provided that, during the Pre-Closing Period, Good Industry Practices shall not require any Seller to expend any funds other than to address emergent health and safety conditions at the Vallecitos Nuclear Center or actions required to comply with (i) applicable Laws, including Nuclear Laws and Environmental Laws, (ii) Permits, and (iii) Assumed Contracts. Good Industry Practices are not intended to be limited to the optimal practices, methods, or acts to the exclusion of all others, but rather to be practices, methods, or acts generally accepted in the nuclear industry in the United States.
"Governmental Authority" means any federal, state, local, provincial, foreign, international or other governmental, regulatory or administrative agency, legislature, bureau, branch, taxing authority, commission, department, board, or other governmental subdivision, court, tribunal, magistrate, justice, or arbitrating body, or any quasi-governmental or non-governmental body administering, regulating or having general oversight over the Vallecitos Licensed Facilities, the Vallecitos Nuclear Center, or the Parties.
"GTCC" means radioactive waste that is defined as Greater Than Class C waste under the NRC regulations in 10 C.F.R. § 61.55.
8 4858-8955-7603.vl
"Hazardous Substances" means : (i) any petroleum, asbestos, asbestos-containing material, and urea formaldehyde foam insulation and transformers or other equipment that contains polychlorinated biphenyls; (ii) any chemicals, materials or substances defined as or included in the definition of "hazardous substances," "hazardous wastes," "hazardous materials," "hazardous constituents," "restricted hazardous materials," "extremely hazardous substances," "toxic substances," "contaminants," "pollutants," "solid wastes," "toxic pollutants," "hazardous air pollutants" or words of similar meaning and regulatory effect under any applicable Environmental Law; (iii) noise, odor or vibration; and (iv) any other chemical, material or substance, exposure to which is prohibited, limited or regulated by any applicable Environmental Law; in each case excluding any Nuclear Material. For the avoidance of doubt, Nuclear Material is not included within the definition of Hazardous Substances.
"Health and Safety Laws" means any Laws pertammg to safety and health in the workplace, including the Occupational Safety and Health Act, 29 U.S.C. § 651 et seq. and the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq.
"High-Level Waste Repository" means a facility which is designed, constructed and operated by or on behalf of the Department of Energy for the storage and disposal of Spent Nuclear Fuel, GTCC, and HLW in accordance with the requirements set forth in the Nuclear Waste Policy Act of 1982, as amended.
"Hillside Decommissioning Liabilities" has the meaning set forth in Section 2.3.2.
"Hillside Storage Facility" has the meaning set forth in the Decommissioning Completion Agreement.
"Hillside Storage Facility Reimbursable Cost" has the meaning set forth in the Decommissioning Completion Agreement.
"HLW" means high-level radioactive waste, including (i) the highly radioactive material resulting from the reprocessing of Spent Nuclear Fuel, including liquid waste produced directly in reprocessing and any solid material derived from such liquid waste that contains fission products in sufficient concentrations; and (ii) other highly radioactive material that the NRC , consistent with existing Law, determines by rule requires permanent isolation.
"Income Tax" means any Tax (i) based upon, measured by or calculated with respect to net income, profits or receipts (including capital gains Taxes and minimum Taxes); or (ii) based upon, measured by or calculated with respect to multiple bases (including corporate franchise Taxes) if one or more of the bases on which such Tax may be based, measured by or calculated with respect to, is described in clause (i), in each case together with any interest, penalties or additions to such Tax without taking into account net operating losses or other offsets.
"Indemnifiable Loss" means all deficiencies, judgments, settlements, interest, fines ,
penalties, diminution in value, claims, demands, suits, Taxes (other than Income Taxes), Losses and Liabilities (including reasonable legal, accounting, attorney's fees or other professionals and reasonable disbursements in connection therewith). 9 4858-8955-7603.vl
"Indemnifying Party" has the meaning set forth in Section 8.1.3.
"Indemnitee" means either a Seller Indemnitee or a Buyer Indemnitee, as applicable.
"Independent Accounting Firm" has the meaning set forth in Section 6.10.5.
"Insurance Policies" has the meaning set forth in Section 2.2.3.
"Investment Management Agreement" means the agreement between Buyer and its investment manager with respect to investment of the funds received from Sellers and placed into the NDF, in the form attached hereto as Exhibit E.
"IRS" means the United States Internal Revenue Service or any successor agency thereto.
"Knowledge" means, with respect to Buyer, the actual knowledge as of the Contract Date of the Knowledge Persons of Buyer, and, with respect to Sellers (or to GE individually), the actual knowledge as of the Contract Date of the Knowledge Persons of Sellers.
"Knowledge Persons" means, with respect to the Buyer, the individuals set forth on Schedule 1.1 (a) and, with respect to Sellers, the individuals set forth on Schedule 1. I(b ).
"Law" or "Laws" means all laws, rules, regulations, directives, standards, codes, statutes, ordinances, permits and permit conditions, licenses and license conditions, judicial decrees, injunctions, treaties, and administrative orders of any Governmental Authority, including administrative and judicial interpretations thereof, including Environmental Laws, Health and Safety Laws, Nuclear Laws, cybersecurity laws, privacy and consumer protection laws, tax laws and applicable tax treaties, building, and labor and employment laws.
"Liability" or "Liabilities" means any indebtedness, damage, liability or obligation (whether direct or indirect, whether known or unknown, whether asserted or not asserted, whether absolute or contingent, whether accrued or not accrued, whether liquidated or unliquidated, whether due or to become due, and whether in contract, tort, strict liability or otherwise), and including all costs and expenses relating thereto, other than any Liability for Income Taxes.
Without limiting the generality of the foregoing, in the case of the NRC Licenses, "Liabilities" shall include the NRC Commitments.
"Loss" or "Losses" means any and all damages, fines , fees , penalties, deficiencies, losses, costs and expenses (including all Remediation costs, reasonable accountants' fees and other experts' fees , or other expenses of litigation or actions, suits or proceedings, settlements or compromises relating thereto or of any claim, default or assessment).
"Low-Level Waste" means radioactive waste, including GTCC: (i) not classified as Spent Nuclear Fuel, HLW, transuranic waste, or Byproduct Material as defined in Section 1 le.(2) of the Atomic Energy Act (42 U.S.C. § 2014(e)(2)); and (ii) that the NRC, consistent with then-current Law and clause (i) above, classifies as low-level radioactive waste.
"NDF" means the external trust fund established by Sellers before Closing with respect to the Vallecitos Licensed Facilities and Vallecitos Nuclear Center for purposes of Decommissioning 10 4858-8955-7603.vl
the Vallecitos Licensed Facilities and Vallecitos Nuclear Center and funded prior to Closing with the NDF Minimum Amount.
"NDF Minimum Amount" means, without duplication, [
] minus (a) with respect to any Pre-Closing Decommissioning Activities performed by Buyer pursuant to a separate contract between Buyer and Sellers, the cumulative value of the Pre-Closing Decommissioning Activities set forth on Schedule 6 .14 that Buyer completes during the Pre-Closing Period or (b) with respect to an Pre-Closin Decommissionin Activities erformed b Sellers or an Person other than Bu er "NDF Trust Agreement" means the trust agreement by and among The Bank of New York Mellon Corporation or the Wilmington Trust Company, as Trustee, and GE or GEH governing the NDF at Closing in the form reasonably acceptable to the parties thereto and Buyer.
"Net Cash Proceeds" means, with respect to any Disposition Event, the amount of cash proceeds actually received by Buyer or its Affiliates in respect of such Disposition Event after deducting therefrom (a) any out-of-pocket costs and expenses incurred or amounts paid by Buyer or its Affiliates with respect to the Fee Real Property subject to the Disposition Event related to demolition, dismantlement, or removal of structures, facilities or other materials on, the Remediation of Hazardous Substances in, on, at, under, or migrating from, or improvements to the applicable Fee Real Property in anticipation of the future sale thereof, including vegetation management, landscaping, creation of access and access maintenance, grading, drainage improvements, fencing, or any other real property development which makes the Fee Real Property more usable and/or valuable; (b) any amounts required to be escrowed by Buyer or its Affiliates for indemnities related to such Disposition Event until such time as any remaining amounts are released to Buyer or its Affiliates and (c) [ ] any legal, accounting, brokerage and other professional fees and commissions, and transfer Taxes (including real property transfer, sales, use value added, stamp, documentary, recording, registration, conveyance, personal property transfer, registration, duty, or similar Taxes) paid, assessed or estimated in good faith to be payable by Buyer or its Affiliates in connection with such Disposition Event; rovided that no deduction shall be made to Net Cash Proceeds for an costs or ex enses
] and provided further that any costs deducted under clause (a) for the Remediation of Hazardous Substances shall only be deductible to the extent that such costs were required by Law or otherwise by a Governmental Authority for the Remediation of Hazardous Substances to meet standards for commercial or industrial use only (rather than agricultural or residential use).
"New Exception" has the meaning set forth in Section 6.11.2.
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"Nonparty Affiliates" has the meaning set forth in Section 10 .18.
"NRC means the United States Nuclear Regulatory Commission and any successor agency thereto.
"NRC Commitments" means all written regulatory commitments made in correspondence by Sellers to the NRC that was made on NRC's docket for any or all of the Vallecitos Licensed Facilities prior to the Closing Date with respect to the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center.
"NRC License Amendments" means the license amendment request filed along with the application to transfer the NRC Licenses from Sellers to Buyer that seek the following license conditions be added to each NRC License: (i) that no changes can be made to the NDF Trust Agreement unless the NRC gives its consent in writing; (ii) that the requirements in 10 C.F.R.
§ 50.75(h)(l) apply to the NDF; and (iii) that the requirements of 10 C.F.R. § 50.82(a)(8) apply to theNDF.
"NRC Licenses" means (a) NRC Facility Possession-Only License No. TR-I for the General Electric Test Reactor; (b) NRC Facility Possession-Only License No. DR-10 for the ESDA Experimental Vallecitos Superheat Reactor; (c) NRC Facility Operating License No. R-33 for the Nuclear Test Reactor; (d) NRC Facility Possession-Only License No. DPR-1 for the Vallecitos Boiling Water Reactor; and (e) NRC Materials License Nos. SNM-960 and SNM-1270 for the Vallecitos Nuclear Center; and any other amendments to, or consents, orders and approvals from the NRC, issued in connection with, any of the foregoing.
"Nuclear Laws" means all Laws, other than Environmental Laws, relating to the regulation of nuclear facilities, Source Material, Byproduct Material, and Special Nuclear Material; the regulation of Low-Level Waste; the transportation and storage of Nuclear Material; the regulation of Safeguards Information; the enrichment of uranium; the regulation, including disposal and storage, of Spent Nuclear Fuel, GTCC, and HL W; contracts for and payments into the Nuclear Waste Fund. "Nuclear Laws" include the Atomic Energy Act; the Price-Anderson Act; the Energy Reorganization Act; Convention on the Physical Protection of Nuclear Material Implementation Act of 1982, Public Law 97-351 ; 96 Stat. 1663; the Foreign Assistance Act of 1961 , 22 U.S.C.
§ 2429 et seq.; the Nuclear Non-Proliferation Act of 1978, 22 U.S.C. § 3201 ; the Low-Level Radioactive Waste Policy Act, 42 U.S.C. § 2021b et seq. ; the Nuclear Waste Policy Act; the Low-Level Radioactive Waste Policy Amendments Act of 1985, 42 U.S.C. § 2021d, 471 ; the Energy Policy Act of 1992, 4 U.S.C. § 13201 et seq.; and any state or local Laws, other than Environmental Laws, analogous to the foregoing.
"Nuclear Material" means Source Material, Byproduct Material, Special Nuclear Material, Low-Level Waste, HLW, and Spent Nuclear Fuel, as well as any Hazardous Material or other material intermingled with or contaminated by any Nuclear Material.
"Nuclear Waste Fund" means the fund established by Section 302(c) of the Nuclear Waste Policy Act, in which the Spent Nuclear Fuel Fees to be used for the design, construction and operation of a High-Level Waste Repository and other activities related to the storage and disposal of Spent Nuclear Fuel, HLW, and GTCC waste are deposited.
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"Nuclear Waste Policy Act" means the Nuclear Waste Policy Act of 1982, 42 U.S.C.
§ 10101 et seq. , as amended.
"Parent Guarantor" means NorthStar Group Services, Inc. , a Delaware corporation.
"Parent Guaranty" means a guaranty in the form attached hereto as Exhibit G issued by Parent Guarantor in favor of Sellers, pursuant to which Parent Guarantor guarantees the payment and performance of the obligations of Buyer under this Agreement and the Ancillary Agreements.
"~ " (and the corresponding term "Parties") has the meaning set forth in the preamble.
"Performance Deed of Trust" means a performance deed of trust with respect to Buyer's obligations to Decommission the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center in the form attached hereto as Exhibit J.
"Permits" has the meaning set forth in Section 4.12.1.
"Permitted Encumbrances" means: (i) statutory liens for Taxes (other than Income Taxes) or other governmental charges or assessments not yet due or delinquent or the validity of which are being contested in good faith by appropriate proceedings; (ii) mechanics' , materialmen's, carriers' , workers' , repairers' and other similar liens arising or incurred in the ordinary course of business relating to obligations as to which there is no default on the part of Sellers or the validity of which are bein contested in ood faith and which do not, individually or in the aggregate, exceed [ ]; (iii) zoning, entitlement, conservation restriction and other land use and environmental regulations imposed by Governmental Authorities, as do not, individually or in the aggregate materially impair the present use and enjoyment of the asset or property subject thereto or affected thereby; (iv) the liens, easements, leases, licenses, conservation easements, encumbrances and encroachments shown on the Title Policy and Survey (including standard printed exceptions) to be obtained prior to the Closing pursuant to Section 6.11 ; (v) the deed restrictions set forth in the Deed; (vi) the Permitted Real Property Encumbrances; (vi) the liens existing on the Contract Date on the items described on Schedule 1.1 (c) which shall be paid off and terminated or released prior to Closing; and (viii) such other liens, imperfections in or failures of title, easements, leases, licenses, restrictions, activity and use limitations, conservation easements, Encumbrances and encroachments, as do not, individually or in the aggregate, (1) materially impair the present use and enjoyment of the asset or property subject thereto or affected thereb or 2 detract from the value of the Assets in an amount in excess of [ ]
"Permitted Real Property Encumbrances" means (a) all matters shown as exceptions on Schedule 6 .11.1 , (b) any New Exceptions which are not timely objected to by Buyer pursuant to Section 6.11 or which are objected to by Buyer but Seller does not agree to remove or endorse over and Buyer does not terminate or is not deemed to terminate this Agreement pursuant to Section 6.11 , (c) real estate Taxes and assessments for the current tax year not yet due and payable, and (d) all exceptions which have been caused by or through Buyer.
"Person" means any individual, partnership, limited liability company, Jomt venture, corporation, trust, unincorporated organization, association, or Governmental Authority.
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"PLR" has the meaning set forth in Section 6.8.7.
"PLR Request" has the meaning set forth in Section 6.8.7.
"Post-Closing Tax Period" means any taxable period or portion thereof beginning after the Closing Date.
"Pre-Closing Date ICRP Payments" has the meaning set forth in Section 6.18.2.
"Pre-Closing Decommissioning Activities" has the meaning set forth in Section 6 .14.
"Pre-Closing Period" means the period beginning on the Contract Date and ending on the Closing Date.
"Pre-Closing Tax Period" means any taxable period or portion thereof ending on or prior to the Closing Date.
"Price-Anderson Act" means Section 170 of the Atomic Energy Act and related provisions of Section 11 of the Atomic Energy Act.
"Proprietary Information" means the Buyer Proprietary Information or the Sellers Proprietary Information, or both, as the context requires.
"Purchase Price" has the meaning set forth in Section 3.2.
"Real Property" means the Fee Real Property and the rights of Seller under the Real Property Agreements.
"Real Property Agreements" has the meaning set forth in Section 4.7.
"Release" means any actual or threatened spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, migrating, dumping or disposing of a Hazardous Substance into or through the Environment or within any building, structure, facility or fixture.
"Release Condition" has the meaning set forth in Section 6.23.
"Remediation" means any action of any kind to address a Release, the threat of a Release or the presence of Hazardous Substances, including any or all of the following activities:
(i) monitoring, investigation, sampling and analysis, assessment, treatment, cleanup, containment, removal, mitigation, response or restoration work; (ii) obtaining any permits, consents, approvals or authorizations of any Governmental Authority necessary to conduct any such activity; (iii) preparing and implementing any plans or studies for any such activity; (iv) obtaining a written notice from a Governmental Authority with jurisdiction under Environmental Laws that no material additional work is required by such Governmental Authority; (v) the use, implementation, application, installation, operation or maintenance of remedial action, remedial technologies applied to the surface or subsurface soils, excavation and treatment or disposal of soils, systems 14 4858-8955-7603.vl
for long term treatment of surface water or groundwater, engineering controls or institutional controls; and (vi) any other activities to address the presence or Release of Hazardous Substances.
"Representatives" of a Party means the Affiliates of such Party, and such Party's and such Affiliates' respective directors, managers, officers, employees, agents, partners, advisors (including accountants, legal counsel, environmental consultants, and financial advisors) and other authorized representatives.
"Required Regulatory Approvals" means the Buyer's Required Regulatory Approvals and the Sellers' Required Regulatory Approvals.
"Right of First Negotiation Agreement" means the Right of First Negotiation Agreement in the form attached hereto as Exhibit K.
"Safeguards Information" means information that is required to be protected under the terms of 10 C.F.R. § 73.21.
"Seller" or "Sellers" has the meaning set forth in the preamble.
"Seller Indemnitee" has the meaning set forth in Section 8.1.1.
"Seller Material Adverse Effect" means any change, event, occurrence or development that has or would reasonably be expected to, individually or cumulatively: (i) have a material adverse effect on the Assets, including Buyer's ownership, use or possession of the Assets; (ii) prevent Buyer's Decommissioning of the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center or iii to the extent not covered b clauses i and ii of this 15 4858-8955-7603.v l
"Seller Parties" means GE, GEH, their Affiliates, and their respective members, officers, directors, employees, agents, successors, and assigns.
"Seller Tax Contest" has the meaning set forth in Section 6.10.8.1.
"Sellers Proprietary Information" means (i) all drawings, reports, data, Software, materials or other information relating to the possession, operation and maintenance or Decommissioning, actual or proposed, of the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center prior to the Closing Date, or otherwise pertaining to the Assets; and (ii) any financial, operational or other information concerning Sellers or their Affiliates or their respective assets and properties, including geologic, geophysical, scientific or other technical information, and know-how, inventions and trade secrets, whether furnished before or after the Contract Date, whether oral or written or in electronic or digital media, and regardless of the manner in which it is furnished, that is provided by or on behalf of Sellers or their Representatives to Buyer or its Representatives, and (iii) any Third-Party Proprietary Information; provided that, Sellers Proprietary Information does not include any such information which (a) is or becomes generally available to the public other than as a result of a disclosure by Buyer or its Representatives; (b) was available to Buyer or its Representatives on a non-confidential basis prior to its disclosure by or on behalf of Sellers or their Representatives; (c) becomes available to Buyer or its Representatives on a non-confidential basis from a Person other than Sellers or their Representatives who is not, to the Knowledge of Buyer, otherwise bound by a confidentiality agreement with Sellers or their Representatives, or is otherwise not, to the Knowledge of Buyer, under any obligation to Sellers or their Representatives not to transmit the information to Buyer or its Representatives; or (d) was independently developed by Buyer or its Representatives without reference to or reliance upon Sellers Proprietary Information.
"Sellers' Required Regulatory Approvals" means the regulatory approvals identified in Schedule 4.3.3 and Schedule 4.3.4.
"Software" means computer software, together with, as applicable, object code, source code and firmware .
"Source Material" means: (i) uranium or thorium or any combination thereof, in any physical or chemical form, or (ii) ores which contain by weight one-twentieth of one percent (0.05%) or more of(a) uranium, (b) thorium, or (c) any combination thereof. Source Material does not include Special Nuclear Material.
"Special Nuclear Material" means plutonium, uranium-233 , uranium enriched in the isotope-233 or in the isotope-235 , and any other material that the NRC determines to be "Special Nuclear Material," but does not include Source Material. Special Nuclear Material also refers to any material artificially enriched by any of the above-listed materials or isotopes but does not include Source Material.
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"Spent Nuclear Fuel" means any nuclear fuel and related components located at Vallecitos Nuclear Center that have been permanently withdrawn from a nuclear reactor following irradiation and has not been chemically separated into its constituent elements by reprocessing.
"Spent Nuclear Fuel Fees" means the one-time fee to be paid with respect to Spent Nuclear Fuel and HL W, as provided in Section 302 of the Nuclear Waste Policy Act at 10 C.F .R. Part 961.
"Standby and Provisional Trust Fund" means the external trust fund maintained by Buyer after the Closing with respect to the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center in accordance with the Decommissioning Completion Agreement.
"Standby and Provisional Trust Fund Account Agreement" means the trust agreement by and among an Acceptable Institution as Trustee and Buyer governing the Standby and Provisional Trust Fund Account.
"Straddle Period" means any taxable period that includes, but does not end on, the Closing Date.
"Subdivision Map Act" means the Subdivision Map Act, California Government Code, Title 7, Division 2, § 66410 et seq.
"Survey" has the meaning set forth in Section 6 .11.1.
"Tangible Personal Property" has the meaning set forth in Section 2.1. 7.
"Tax" or "Taxes" means all taxes, charges, fees, levies, penalties or other assessments imposed by any federal, state, local, provincial or foreign taxing authority, including income, gross receipts, excise, real or personal property, sales, transfer, customs, duties, franchise, payroll, withholding, social security, receipts, license, stamp, occupation, employment, or other taxes, including (i) any interest, penalties or additions attributable thereto or any failure to comply with any requirement imposed with respect to any Tax Return; (ii) any payments to any state, local, provincial or foreign taxing authorities in lieu of any such taxes, charges, fees , levies or assessments; and (iii) any liability for items described above by reason of contract or operation of Law.
"Tax Benefit" shall mean any reduction in any cash Tax liability as a result of a Loss that has been indemnified under this Agreement equal to the positive difference, if any, between: (i) the indemnified party's liability for Taxes payable in the year the Loss is incurred and the following year computed not taking into account such Loss; and (ii) the indemnified party's liability for Taxes payable in the year the Loss is incurred and the following year computed taking into account the Loss, net of any reasonable expenses incurred in connection with claiming such reduction, in each case after taking into account the Tax effect of the receipt of the indemnification payment.
"Tax Contest" has the meaning set forth in Section 6 .10. 8 .1.
"Tax Return" means any return, report, information return, declaration, claim for refund or other document (including any schedule or related or supporting information) required to be supplied to any Governmental Authority with respect to Taxes including amendments thereto, 17 4858-895 5-7603.vl
including any information return filed by a tax-exempt organization and any return filed by a nuclear decommissioning trust.
"Termination Date" has the meaning set forth in Section 9.1.5.
"Third-Party Claim" has the meaning set forth in Section 8.2.1.
"Third-Party Proprietary Information" means any drawings, reports, data, Software, materials, scientific or other technical information, know-how, inventions and trade secrets pertaining to any proprietary or confidential information provided by, or intellectual property of, any Person not a Party to this Agreement and not an Affiliate to a Party to this Agreement that has or is providing goods or services with respect to the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center.
"Title Company" has the meaning set forth in Section 6.11.1.
"Title Policy" has the meaning set forth in Section 6.11.3.
"Title Report" has the meaning set forth in Section 6.11.1.
"Total Decommissioning Costs" means the total nuclear decommissioning costs, as such term is used in Section 468A( d)(2)(A) of the Code, with respect to the decommissioning of the Vallecitos Nuclear Center and/or the Vallecitos Licensed Facilities.
"Transfer Taxes" means any Real Property transfer, sales, use, value added, stamp, documentary, recording, registration, conveyance, stock transfer, intangible property transfer, personal property transfer, registration, duty, securities transactions or similar fees, Taxes or governmental charges of a similar nature (together with any interest or penalty, addition to Tax or additional amount imposed) as levied by any Governmental Authority in connection with the transfer of title to the Assets to Buyer and the assumption by Buyer of the Assumed Liabilities, including any payments made in lieu of any such Taxes or governmental charges which become payable in connection with the transactions contemplated by this Agreement.
"Transferable Permits" means those Permits and Environmental Permits that are transferable to Buyer without application to, a filing with, or notice or consent or approval of any Governmental Authority.
"Treasury Regulations" means Treasury Regulations promulgated under the Code. Any reference to a Treasury Regulation includes a reference to the corresponding provision in any predecessor Treasury Regulation.
"Trustee" means the trustee of the NDF appointed pursuant to the NDF Trust Agreement and the trustee of the Standby and Provisional Trust Fund, as applicable.
"Vallecitos Decommissioning Liabilities" has the meaning set forth in Section 2.3 .1.
"Vallecitos Licensed Facilities" means the facilities that are subject to the NRC Licenses or the California License.
18 4858-895 5-7603.vl
"Vallecitos Nuclear Center" means all of the Real Property together with the facilities located thereon, including the Vallecitos Licensed Facilities, the Hillside Storage Facility and any other lab, facility, buildings, improvements, and equipment that supports the Vallecitos Licensed Facilities. Any reference to the Vallecitos Nuclear Center shall include the surface and subsurface elements, including the soils and groundwater present at the Vallecitos Nuclear Center and any references to items "at the Vallecitos Nuclear Center" shall include all items "at, in, on, upon, over, across, under, and within" the Vallecitos Nuclear Center.
"VNC Books and Records" has the meaning set forth in Section 2.1.11.
"VNC Contracts" has the meaning set forth in Section 4.10.1.
"VNC Leases" has the meaning set forth in Section 4 .10. 5.
1.2 Certain Interpretive Matters. Unless otherwise required by the context in which any term appears: (i) The singular shall include the plural, the plural shall include the singular, and reference to any gender shall include all genders. (ii) References to "Articles," "Sections," "Schedules" or "Exhibits" shall be to articles, sections, schedules or exhibits of or to this Agreement, and references to "paragraphs" or "clauses" shall be to separate paragraphs or clauses of the section or subsection in which the reference occurs. (iii) The words "herein," "hereof' and "hereunder" shall refer to this Agreement as a whole and not to any particular section or subsection, of this Agreement; and the words "include," "includes" or "including" shall mean "including, but not limited to" or "including, without limitation." The word "threatened" refers to threats made in writing. (iv) The term "day" shall mean a calendar day, commencing at 12:01 a.m. (Eastern Time). The term "week" shall mean any seven consecutive day period commencing on a Sunday, and the term "month" shall mean a calendar month; provided, however, that when a period measured in months commences on a date other than the first day of a month, the period shall run from the date on which it starts to the corresponding date in the next month and, as appropriate, to succeeding months thereafter. Whenever an event is to be performed or a payment is to be made by a particular date and the date in question falls on a day which is not a Business Day, the event shall be performed, or the payment shall be made, on the next succeeding Business Day: provided, however, that all calculations shall be made regardless of whether any given day is a Business Day and whether or not any given period ends on a Business Day. (v) All references to a particular entity shall include such entity's permitted successors and permitted assigns unless otherwise specifically provided herein. (vi) All references herein to any Law or to any contract or other agreement shall be to such Law, contract or other agreement as amended, supplemented or modified from time to time unless otherwise specifically provided herein. 19 4858-8955-7603.v l
1.2.1 The titles of the Articles and Sections hereof and Exhibits and Schedules hereto have been inserted as a matter of convenience of reference only and shall not control or affect the meaning or construction of any of the terms or provisions hereof 1.2.2 This Agreement was negotiated and prepared by the Parties with advice of counsel to the extent deemed necessary by each Party; the Parties have agreed to the wording of this Agreement; and none of the provisions hereof shall be construed against one Party on the ground that such Party is the author of this Agreement or any part hereof 1.2.3 The Exhibits hereto are incorporated in and are intended to be a part of this Agreement; provided, however, that in the event of a conflict between the terms of any Exhibit and the terms of this Agreement, the terms of this Agreement shall take precedence prior to the Closing, and the terms of the Exhibits shall take precedence from and after the Closing. ARTICLE II PURCHASE AND SALE 2.1 Assets. Upon the terms and subject to the satisfaction of the conditions contained in this Agreement, on the Closing Date, Sellers will deliver to Buyer one or more Deeds, Bills of Sale and Assignment and Assumption Agreements, as applicable, whereby Sellers will sell, assign, convey, transfer and deliver to Buyer, and Buyer will acquire from Sellers, free and clear of all Encumbrances (except for Permitted Encumbrances or Permitted Real Property Encumbrances, as applicable), all of Sellers' right, title and interest in and to the following, wherever located, other than the Excluded Assets (collectively, the "Assets"): 2.1.1 All of the Real Property together with the improvements located thereon and appurtenances thereto; 2.1.2 All right, title and interest of Sellers in the Vallecitos Licensed Facilities and Hillside Storage Facility not otherwise transferred to Buyer pursuant to Section 2.1.1 ; 2.1.3 Sellers' interest in and title to Nuclear Material at the Vallecitos Nuclear Center, including Sellers' rights and duties under contracts with owners of Spent Nuclear Fuel and HL W previously assigned to GEH; 2.1.4 The NRC Licenses; 2.1.5 The California License; 2.1.6 The assets of the NDF, including all profits, dividends, income, interest and earnings accrued thereon, cost estimates and any other information relevant for tax purposes; 2.1.7 Machinery, mobile or otherwise, equipment (including computer hardware and communications equipment), vehicles, tools, spare parts, materials, works in progress, fixtures , furniture and furnishings and other personal property relating to or used in the ordinary course of business of maintaining the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center, including all emergency warning devices and assets and the items of personal property owned by Sellers and located at the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center 20 4858-895 5-7603.vl
(collectively, "Tangible Personal Property") that 1s not listed in the schedule referenced m Section 2.2.4; 2.1.8 All unexpired warranties from third parties with respect to any item of Tangible Personal Property that are transferable without notice or consent; 2.1.9 All VNC Contracts and Real Property Agreements and any other contracts and agreements to which a Seller is a party or by which a Seller is bound that arise out of the operation of the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center (but excluding master or enabling agreements that are not used exclusively in connection with the Vallecitos Nuclear Center) (the "Assumed Contracts"), including the Contracts set forth on Schedule 2.1.9; 2.1.10 All Transferable Permits; 2.1.11 All books, operating records, licensing records, quality assurance records, purchasing records, and equipment repair, maintenance or service records relating exclusively to the design, construction, licensing, operation or Decommissioning of the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center; operating, safety and maintenance manuals, inspection reports, environmental assessments, engineering design plans, documents, blueprints and as-built plans, specifications, procedures and other similar items of Sellers, wherever located, relating exclusively to the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center, whether existing in hard copy or magnetic or electronic form (subject to the right of Sellers to retain copies of same for its use) (collectively, the "VNC Books and Records"); 2.1.12 The interest of Sellers, if any, in the name "Vallecitos Nuclear Center" as used as a designation attached to or associated with the Vallecitos Licensed Facilities, or any part, derivative or combination thereof; 2 .1.13 The nuclear liability insurance policies from ANI relating to the Vallecitos Nuclear Center and all activities at the Vallecitos Nuclear Center, to the extent transferable, except to the extent provided in Section 2.2.2; 2.1.14 Subject to Buyer's commitment to satisfy its indemnification obligations under Section 8.1 , the rights of Sellers in and to (i) any causes of action or claims and (ii) defenses against third parties (including indemnification and contribution) relating to any Assumed Liabilities; and 2.1.15 The GEH Standard Spent Fuel Disposal Contract and all rights and obligations of Sellers with respect thereto. 2.2 Excluded Assets. Notwithstanding anything to the contrary in this Agreement, Sellers shall not sell, transfer or assign, and Buyer shall not acquire any right, title or interest in or to the following assets (the "Excluded Assets"): 2.2.1 All rights of Sellers under this Agreement and the Ancillary Agreements; 2.2.2 All rights to premium refunds or distributions from ANI made with respect to any period prior to the Closing Date under the nuclear liability insurance policies relating to the 21 4858-8955-7603.vl
Vallecitos Licensed Facilities, including any rights to receive premium refunds, distributions and continuity credits with respect to periods prior to the Closing Date pursuant to the ANI nuclear industry credit rating plan, and regardless of whether such refunds, distributions or continuity credits occur prior to or after the Closing Date; 2.2.3 All policies and programs of or agreements for insurance and interests in insurance pools and programs of the Sellers (in each case including self-insurance and insurance from Affiliates but excluding nuclear liability insurance policies from ANI relating to the Vallecitos Nuclear Center) (collectively, "Insurance Policies") and all rights of any nature with respect to any Insurance Policy, including rights to any premium refunds, proceeds or other distributions made before, on or after the Closing Date; 2.2.4 Certain equipment and other assets as set forth in Schedule 2.2.4; 2.2.5 All cash, cash equivalents, bank deposits, accounts and notes receivable (trade or otherwise), except as included in the assets of the NDF, and any income, sales, payroll or other receivables relating to Taxes, in each case whether or not relating to the Assets; 2.2.6 Any and all rights to the GE Name and GE Marks, together with any contracts, agreements or understandings granting rights to use the same (including any intellectual property of the Sellers, to the extent incorporating the GE Name and GE Marks); 2.2.7 The rights of Sellers in and to any causes of action, claims and defenses against third parties (including indemnification and contribution) arising out of or relating to (i) the Excluded Assets; or (ii) the Excluded Liabilities; 2.2.8 Any and all of Sellers' rights in any contract representing an intercompany transaction between GE or GEH, on one hand, and an Affiliate of a Seller, on the other hand, whether or not such transaction relates to the provision of goods and services, payment arrangements, intercompany charges or balances, or the like; 2.2.9 To the extent not otherwise provided for in this Section 2.2, any refund or credit related to Taxes: (i) paid by Sellers with respect to the Assets for periods (or portions thereof) that end prior to the Closing Date, whether such refund is received as a payment or as a credit against future Taxes; or (ii) arising under any agreement that is included in the Assets and relates to a period (or portion thereof) ending on or prior to the Closing Date, but only to the extent such Taxes were previously paid or otherwise borne by Sellers; 2.2.10 All books, operating records, licensing records, quality assurance records, purchasing records, and equipment repair, maintenance or service records relating primarily to the design, construction, licensing or operation of the Excluded Assets; operating, safety and maintenance manuals, inspection reports, environmental assessments, engineering design plans, documents, blueprints and as built plans, specifications, procedures and other similar items of Sellers, wherever located, relating primarily to the Excluded Assets or the Excluded Liabilities, whether existing in hard copy or magnetic or electronic form; 22 4858-8955-7603.vl
2.2.11 All (i) records, presentations, information and reports prepared by or on behalf of Sellers or their respective Affiliates and Representatives prior to the Contract Date and (ii) confidentiality agreements with prospective purchasers and all bids and expressions of interest received, in each case regarding the transactions contemplated by this Agreement; 2.2.12 All personnel and employment records for employees and former employees of the Vallecitos Nuclear Center; 2.2.13 All Benefit Plans and other employee benefit plans, programs, arrangements and agreements sponsored or maintained by Sellers or their respective Affiliates, and all trusts and other assets or rights related thereto; 2.2.14 All rights of Sellers under this Agreement, the Ancillary Agreements and the transactions contemplated hereby and thereby; and 2.2.15 All other assets of Sellers and their Affiliates not included in the Assets. 2.3 Assumed Liabilities and Obligations. Upon the terms and subject to the satisfaction of the conditions contained in this Agreement, on the Closing Date, Buyer shall deliver to Sellers the Assignment and Assumption Agreement pursuant to which Buyer shall assume and agree to pay, perform and discharge when due, all of the Liabilities of Sellers that relate to the Assets or are otherwise specified below, other than the Excluded Liabilities (collectively, the "Assumed Liabilities"), including: 2.3.1 All Liabilities ansmg in connection with the Decommissioning of the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center, including any obligations under applicable Law (the "Vallecitos Decommissioning Liabilities"); 2.3.2 All Liabilities arising in connection with operating and Decommissioning the Hillside Storage Facility (the "Hillside Decommissioning Liabilities" and, together with the Vallecitos Decommissioning Liabilities, the "Decommissioning Liabilities"); 2.3.3 All Environmental Liabilities arising before, on or after the Closing Date; 2.3.4 All outstanding commitments made to and agreements made with Governmental Authorities related to the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center and all orders of Governmental Authorities related the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center set forth on Schedule 2.3.4 hereto; 2.3.5 All Liabilities arising before, on or after the Closing Date: (i) with respect to the ownership, possession, use or maintenance of the Assets, including all Decommissioning of the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center; (ii) under the Real Property Agreements; (iii) under the Transferable Permits; (iv) under the Assumed Contracts; and (v) the contracts, licenses, agreements and personal property leases entered into with respect to the Assets after the Contract Date consistent with the terms of this Agreement; 2.3.6 All Liabilities for any Asset-Level Taxes attributable to a Post-Closing Tax Period (in the case of a Straddle Period, allocated in accordance with Section 6.10.3); 23 4858-8955-7603.vl
2.3.7 All obligations arising on or after the Closing Date to pay any additional premiums to ANI with respect to the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center due to audit assessments performed on or after the Closing Date; 2.3.8 All Liabilities arising before, on or after the Closing Date under or relating to Nuclear Laws or Nuclear Material, including any Environmental Liabilities arising out of the ownership, lease, occupancy, possession, operation, use, or Decommissioning of the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center, including: (i) any and all Liabilities to third parties (including employees) for personal injuries, property damages or tort actions or similar causes of action; and (ii) any Liabilities arising out of or resulting from an "extraordinary nuclear occurrence," a "nuclear incident" or a "precautionary evacuation" (as such terms are defined in the Atomic Energy Act) at the Vallecitos Nuclear Center, or any other NRC licensed nuclear reactor site in the United States, or in the course of the transportation of Nuclear Material to or from the Vallecitos Nuclear Center or any other NRC licensed nuclear reactor site in the United States. 2.3.9 All Spent Nuclear Fuel Fees and all Liabilities under the GEH Standard Spent Fuel Disposal Contract, including the obligations relating to payment of the one-time fees (principal plus interest) to be paid under the GEH Standard Spent Fuel Disposal Contract, to the extent that such fees have not been satisfied; 2 .3 .10 Except as otherwise expressly provided herein, any Liabilities of Buyer to the extent arising from the execution delivery or performance of this Agreement and the transactions contemplated hereby; 2.3 .11 Transfer Taxes allocated to Buyer in accordance with Section 6.10.1 ; and 2.3.12 All Liabilities for DOE Decontamination and Decommissioning Fees relating to Nuclear Fuel at the Vallecitos Nuclear Center, if any, assessed after the Closing Date by the Department of Energy except for unpaid invoices due prior to the Closing Date. 2.4 Excluded Liabilities. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement shall be construed to impose on Buyer, and Buyer shall not assume or be obligated to pay, perform or otherwise discharge, the following Liabilities of Sellers (the "Excluded Liabilities"), with all of such Excluded Liabilities remaining as obligations of Sellers or an Affiliate of Sellers, as applicable: 2.4.1 Any Liabilities with respect to any Excluded Assets; 2.4.2 Any Liabilities for Asset-Level Taxes attributable to Pre-Closing Tax Periods (in the case of a Straddle Period, allocated in accordance with Section 6.10.3); 2.4.3 Any Liabilities relating to any Benefit Plan established or maintained in whole or in part by a Seller or by any trade or business (whether or not incorporated) which is or ever has been under common control, or which is or has been treated as a single employer, with a Seller under Section 414(b ), (c), (m) or (o) of the Code (an "ERISA Affiliate") or to which a Seller or any ERISA Affiliate contributes or has contributed, including any multiemployer plan contributed to by a Seller or any ERISA Affiliate or to which a Seller or any ERISA Affiliate is or 24 4858-895 5-7603.vl
was obligated to contribute, including but not limited to any such Liability of a Seller on an ERISA Affiliate (i) for the termination or discontinuance of, or a Seller's or an ERISA Affiliate's withdrawal from, any such Benefit Plan, (ii) relating to benefits payable under any Benefit Plans, (iii) relating to the Pension Benefit Guaranty Corporation under Title IV of ERISA, (iv) relating to a multi-employer plan, (v) with respect to noncompliance with the notice requirements of COBRA prior to the Closing Date, (vi) with respect to any noncompliance of the Benefit Plans with ERIS A or any other applicable Laws, and (vii) with respect to any suit, proceeding or claim which is brought against any Benefit Plans, or any fiduciary or former fiduciary of any of the Benefit Plans; 2.4.4 All Liabilities arising prior to the Closing Date as a result of or in connection with the disposal, storage or transportation of Nuclear Materials at locations other than at the Vallecitos Nuclear Center; 2.4.5 All Environmental Liabilities ansmg before the Closing Date the underlying circumstances, facts or existence of which any Seller had Knowledge of on or prior to the Closing Date but which were not disclosed to Buyer in (a) the Schedules to this Agreement, (b) the materials posted to the Data Room, as determined by reference to the copy of the Data Room provided by Sellers to Buyer pursuant to Section 6.22, (c) the Characterization Reports, (d) publicly available information or materials, or (e) other materials in storage at the Vallecitos Nuclear Center to which Sellers granted Buyer reasonable access. 2.4.6 All Liabilities of Sellers and their Affiliates ansmg or incurred in connection with the negotiation, preparation, investigation and performance of this Agreement, the Ancillary Agreements and the transactions contemplated by such agreements, including fees and expenses of counsel, accountants, consultants, advisers and others; 2.4.7 Transfer Taxes allocated to Seller in accordance with Section 6.10.1 ; 2.4.8 Any Liabilities set forth on Schedule 2.4.8; and 2.4.9 All other Liabilities not expressly allocated to or retained by Buyer in this Agreement or the Ancillary Agreements. 2.5 Control of Litigation After Closing. 2.5.1 Subject to the provisions of ARTICLE VIII, following the Closing, Sellers shall pay for and be entitled exclusively to control, defend and settle any litigation, administrative or regulatory proceeding, and any investigation or other similar activities arising out of or related to any Excluded Assets or Excluded Liabilities and Buyer agrees to reasonably cooperate, at Sellers' expense, with Sellers in connection therewith. 2.5.2 Subject to the provisions of ARTICLE VIII, following the Closing, Buyer shall pay for and be entitled exclusively to control, defend and settle any litigation, administrative or regulatory proceeding, and any investigation or other similar activities arising out of or related to any Assets or Assumed Liabilities, and Sellers agree to reasonably cooperate, at Buyer' s expense, with Buyer in connection therewith. 25 4858-895 5-7603.vl
2.6 Parent Guaranty. On the Contract Date, Parent Guarantor and Sellers shall duly execute and deliver the Parent Guaranty. ARTICLE III THE CLOSING 3.1 Closing. Upon the terms and subject to the satisfaction of the conditions contained in ARTICLE VII, the sale, assignment, conveyance, transfer and delivery of the Assets to Buyer, and the consummation of the other respective obligations of the Parties contemplated by this Agreement shall take place at a closing (the "Closing" and such transaction the "Transaction"), to be conducted remotely through the electronic exchange of documents or otherwise at the offices of Morgan, Lewis & Bockius LLP in New York, New York, at 10:00 a.m. local time, or another mutually acceptable time and location, on the date that is five ( 5) Business Days following the date on which the last of the conditions precedent to Closing set forth in ARTICLE VII have been either satisfied or waived by the Party for whose benefit such conditions precedent exist (except with respect to those conditions which by their terms are to be satisfied at the Closing), but in any event not after the Termination Date, unless the Parties mutually agree on another date. The date on which the Closing occurs is referred to herein as the "Closing Date." The Closing shall be effective for all purposes as of 12:01 a.m. on the Closing Date. 3.2 Purchase Price. Upon the terms and subject to the satisfaction of the conditions contained in this A g r e e m e n ~or caused to be paid to Sellers for the purchase of the Assets the amount of[ - ] (the "Initial Purchase Price") plus any amounts paid to Sellers pursuant to Section 6.12 (with the Initial Purchase Price, the "Purchase Price"). Buyer and Sellers acknowledge and agree that the Purchase Price and Buyer's assumption of the Assumed Liabilities constitutes full and adequate compensation to Seller for the Assets purchased and sold hereunder. The Initial Purchase Price shall be paid by wire transfer of immediately available funds at the Closing to an account designated in writing by Sellers at least two (2) Business Days prior to Closing. 3 .3 Deliveries by Sellers. At the Closing (or, in the case of those items contemplated by Section 3.3.6, on or before the Closing Date), Sellers will deliver, or cause to be delivered, the following to Buyer: 3 .3 .1 The following documents duly executed and delivered by Sellers that are a party thereto, as applicable: 3 .3 .1 .1 The Deed( s) to the Real Property; 3 .3 .1.2 the Bill of Sale; 3 .3 .1.3 the Assignment and Assumption Agreement; and 3 .3 .1. 4 the Decommissioning Completion Agreement; 3.3.2 Copies of the Sellers' Required Regulatory Approvals and any and all other governmental and other third-party consents, waivers or approvals obtained by Sellers with respect 26 4858-895 5-7603.vl
to the transfer of the Assets, or the consummation of the transactions contemplated by this Agreement; 3.3.3 The assets of the NDF to be transferred to Buyer pursuant to Section 6.13.3 ; 3.3.4 An IRS Form W-9 from each Seller duly completed and executed by the Sellers; 3.3.5 A certificate of good standing with respect to each Seller issued by the Secretary of State of the State of the State of New York in the case of GE and the State of Delaware in the case of GEH, in each case issued not earlier than twenty (20) days prior to the Closing Date; 3.3.6 Certified resolutions of the management committee or board or other document evidencing a delegation of authority of each Seller authorizing the execution and delivery of this Agreement and the Ancillary Agreements to be executed by such Seller and the consummation of the transactions contemplated hereby and thereby; 3 .3. 7 A certificate of the secretary or an attesting secretary of each Seller identifying the name and title and bearing the signatures of the officers or authorized person of such Seller authorized to execute and deliver this Agreement, the Ancillary Agreements and the other agreements and instruments contemplated hereby and thereby; 3.3.8 Documentation in form and substance reasonably acceptable to Buyer evidencing the release of the Permitted Encumbrances on the items described on Schedule 1.1 ( c); and 3.3.9 The documents contemplated by ARTICLE VII (Conditions), to the extent not theretofore delivered and such other agreements, consents, documents, instruments and writings as are required to be delivered by Sellers or their Affiliates at or prior to the Closing Date pursuant to this Agreement and other instruments of assignment, transfer or conveyance as shall, in the reasonable opinion of Buyer and its counsel, be necessary to implement the transfer of the Assets to Buyer, in accordance with this Agreement and where necessary in recordable form. 3.4 Deliveries by Buyer. At the Closing, Buyer will deliver, or cause to be delivered, the following to Sellers:
- 3. 4 .1 The Initial Purchase Price, by wire transfer of immediately available funds ,
to the account or accounts designated by Sellers at least two (2) Business Days prior to the Closing Date; 3.4.2 The following documents duly executed and delivered by Buyer, the Parent Guarantor or the Trustee that is a party thereto, as applicable: 3.4.2.1 the Assignment and Assumption Agreement; 3.4.2.2 the Bill of Sale; 3.4.2.3 the Decommissioning Completion Agreement; 27 4858-895 5-7603.vl
3.4.2.4 the Decommissioning Project Schedule; 3.4.2.5 the Standby and Provisional Trust Fund Account Agreement; 3.4.2.6 the Financial Support Agreement; and 3.4.2.7 the Disposal Guarantee; 3.4.3 The executed and acknowledged Performance Deed of Trust. 3.4.4 A certificate of good standing respect to the Buyer issued by the Secretary of State for the State of Delaware not earlier than twenty (20) days prior to the Closing Date; 3.4.5 A certificate of the Secretary or similar officer of Buyer identifying the name and title and bearing the signatures of the officers of Buyer authorized to execute and deliver this Agreement, the Ancillary Agreements and the other agreements and instruments contemplated hereby and thereby; and certified resolutions of the management committee or board of the Buyer authorizing the execution and delivery of this Agreement and the Ancillary Agreements to be executed by the Buyer and the consummation of the transactions contemplated hereby and thereby; and 3.4.6 A certificate of the Secretary or similar duly elected and authorized officer of Buyer identifying the name and title and bearing the signatures of the officers of Buyer authorized to execute and deliver this Agreement, the Ancillary Agreements and the other agreements and instruments contemplated hereby and thereby. 3.4.7 The documents contemplated by ARTICLE VII (Conditions), to the extent not theretofore delivered and such other agreements, consents, documents, instruments and writings as are required to be delivered by Buyer or its Affiliates at or prior to the Closing Date pursuant to this Agreement and other instruments of assignment, transfer or conveyance as shall, in the reasonable opinion of Sellers and its counsel, be necessary to implement the transfer of the Assets to Buyer, in accordance with this Agreement and where necessary in recordable form. ARTICLE IV REPRESENTATIONS AND WARRANTIES OF SELLERS GE, solely with respect to Sections 4.1.1 , 4.2.1 , 4.3.1 , 4.3.3 , 4.6, 4.9, 4.15 , and 4.16 and GEH, with respect to all other Sections of this ARTICLE IV, hereby represent and warrant to Buyer, on a several and not joint basis as of the date hereof and as of the Closing Date, that except to the extent such representations and warranties expressly relate to another date or as set forth on the disclosure schedules attached hereto (the "Schedules"): 4.1 Organization. 4.1.1 GE is a corporation duly organized, validly existing and in good standing under the Laws of the State of New York and has all requisite corporate power and authority to own, sell, lease, and operate its properties and to carry on its business as is now being conducted. 28 4858-8955-7603.vl
4.1.2 GEH is a limited liability company, duly formed, validly existing, and in good standing under the Laws of the State of Delaware and has all requisite limited liability power and authority to own, sell, lease, and operate its properties and to carry on its business as is now being conducted. 4.2 Authority. 4.2.1 GE has full corporate or limited liability power and authority to execute and deliver this Agreement and the Ancillary Agreements to which it is a party and to consummate the transactions contemplated hereby and thereby. The execution and delivery of this Agreement and the Ancillary Agreements and the consummation of the transactions contemplated hereby and thereby have been duly and validly authorized by all necessary action required on the part of GE and no other proceedings on the part of GE is necessary to authorize this Agreement or the Ancillary Agreements or to consummate the transactions contemplated hereby and thereby. This Agreement has been duly and validly executed and delivered by GE, and at the Closing, the Ancillary Agreements will be duly and validly executed and delivered by GE, and assuming that this Agreement and the applicable Ancillary Agreements constitute valid and binding agreements of Buyer and GEH, as applicable, and, subject to the receipt of Sellers' Required Regulatory Approvals, this Agreement and the Ancillary Agreements when executed and delivered at the Closing, constitute the legal, valid and binding agreement of GE, enforceable against GE in accordance with their respective terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar Laws of general applicability relating to or affecting creditors ' rights and to general equity principles. 4.2.2 GEH has full corporate or limited liability power and authority to execute and deliver this Agreement and the Ancillary Agreements to which it is a party and to consummate the transactions contemplated hereby and thereby. The execution and delivery of this Agreement and the Ancillary Agreements and the consummation of the transactions contemplated hereby and thereby have been duly and validly authorized by all necessary action required on the part of GEH and no other proceedings on the part of GEH are necessary to authorize this Agreement or the Ancillary Agreements or to consummate the transactions contemplated hereby and thereby. This Agreement has been duly and validly executed and delivered by GEH, and at the Closing, the Ancillary Agreements will be duly and validly executed and delivered by GEH, and assuming that this Agreement and the applicable Ancillary Agreements constitute valid and binding agreements of Buyer and GE, as applicable, and, subject to the receipt of Sellers ' Required Regulatory Approvals, this Agreement and the Ancillary Agreements when executed and delivered at the Closing, constitute the legal, valid and binding agreement of GEH, enforceable against GEH in accordance with their respective terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar Laws of general applicability relating to or affecting creditors ' rights and to general equity principles. 4.3 Consents and Approvals; No Violation. 4.3.1 Subject to the receipt of Sellers ' Required Regulatory Approvals and the consents set forth in Schedule 4.3.1 , neither the execution and delivery of this Agreement or the Ancillary Agreements by GE nor the consummation of the transactions contemplated hereby or thereby will: (i) conflict with, or result in the breach or violation of, any provision of the certificate 29 4858-895 5-7603.vl
of incorporation or bylaws of GE; (ii) result in a default (or give rise to any right of termination, cancellation or acceleration) under any of the terms, conditions or provisions of any note, bond, mortgage, indenture, license, agreement or other instrument or obligation to which GE is a party or by which GE, or any of the Real Property, may be bound, except for such defaults (or rights of termination, cancellation or acceleration) as to which requisite waivers or consents have been obtained or which would not, individually or in the aggregate, create a Seller Material Adverse Effect; or (iii) violate any Laws applicable to GE, or any of its assets, which violation, individually or in the aggregate, would create a Seller Material Adverse Effect. 4.3.2 Subject to the receipt of Sellers' Required Regulatory Approvals and the consents set forth in Schedule 4 .3 .1 , neither the execution and delivery of this Agreement or the Ancillary Agreements by GEH nor the consummation of the transactions contemplated hereby or thereby will: (i) conflict with, or result in the breach or violation of, any provision of the certificate of formation, or operating agreement of GEH; (ii) result in a default (or give rise to any right of termination, cancellation or acceleration) under any of the terms, conditions or provisions of any note, bond, mortgage, indenture, license, agreement or other instrument or obligation to which GEH is a party or by which either GEH, or any of the Assets (other than the Real Property), may be bound, except for such defaults (or rights of termination, cancellation or acceleration) as to which requisite waivers or consents have been obtained or which would not, individually or in the aggregate, create a Seller Material Adverse Effect; or (iii) violate any Laws applicable to GEH, or any of its assets, which violation, individually or in the aggregate, would create a Seller Material Adverse Effect. 4.3.3 Except as set forth in Schedule 4.3.3 , no declaration, filing or registration with, or notice to, or authorization, consent or approval of any Governmental Authority is necessary for the execution and delivery of this Agreement or the Ancillary Agreements or the consummation by GE of the transactions contemplated by this Agreement or the Ancillary Agreements other than (i) such declarations, filings , registrations, notices, authorizations, consents or approvals which, if not obtained or made, will not, individually or in the aggregate, create a Seller Material Adverse Effect, or (ii) such declarations, filings, registrations, notices, authorizations, consents or approvals which become applicable to GE as a result of the specific regulatory status of Buyer (or any of its Affiliates) or the result of any other facts that specifically relate to the business or activities in which Buyer (or any of its Affiliates) is or proposes to be engaged from and after the Closing. 4.3.4 Except as set forth in Schedule 4.3.4, no declaration, filing or registration with, or notice to, or authorization, consent or approval of any Governmental Authority is necessary for the execution and delivery of this Agreement or the Ancillary Agreements or the consummation by GEH of the transactions contemplated by this Agreement or the Ancillary Agreements other than (i) such declarations, filings , registrations, notices, authorizations, consents or approvals which, if not obtained or made, will not, individually or in the aggregate, create a Seller Material Adverse Effect, or (ii) such declarations, filings , registrations, notices, authorizations, consents or approvals which become applicable to GEH as a result of the specific regulatory status of Buyer (or any of its Affiliates) or the result of any other facts that specifically relate to the business or activities in which Buyer (or any of its Affiliates) is or proposes to be engaged from and after the Closing. 30 4858-8955-7603.vl
4.4 Reports. Since January 1, 2019, GEH has filed or caused to be filed with the applicable state or local utility commissions or regulatory bodies, the NRC, the State of California Department of Public Health, and the Department of Energy, as the case may be, all material forms , statements, reports and documents (including all exhibits, amendments and supplements thereto) required to be filed by GEH with respect to the Assets or the ownership or operation thereof under each of the applicable state public utility Laws, the Atomic Energy Act, the Energy Reorganization Act, and the Price-Anderson Act and the respective rules and regulations thereunder, except for such filings the failure of which to make would not, individually or in the aggregate, be material. All such filings complied in all material respects with all applicable requirements of the appropriate act and the rules and regulations thereunder in effect on the date each such report was filed. As of the Business Day immediately prior to both the date of this Agreement and the Closing Date, neither Seller nor their Affiliates have received any written notification which remains unresolved that any of such filings is not in compliance with the applicable requirements of the appropriate Law. 4.5 Absence of Seller Material Adverse Effect. Since January 1, 2022, except as set forth in Schedule 4.5 , there has been no Seller Material Adverse Effect and Sellers have operated and maintained, or caused to be operated and maintained the Assets in the ordinary course consistent with Good Industry Practices and the non-operating status of the Vallecitos Licensed Facilities or the Hillside Storage Facility. 4.6 Title and Related Matters. 4.6.1 Set forth on Schedule 4.6 is a description of all real property that comprises the Vallecitos Nuclear Center. 4.6.2 There are no outstanding options, rights of first offer or refusal or other preemptive rights in favor of any third party to purchase the Real Property or any portion thereof, except as set forth in the title commitment or Schedule 4.6.2. 4.6.3 Except for Permitted Encumbrances, GEH has good and valid title to, or holds pursuant to valid and binding leases, all of the Tangible Personal Property comprising the Assets free and clear of all Encumbrances. 4.6.4 There are no pending or, to Sellers' Knowledge, governmental proceedings threatened in writing in eminent domain which would materially affect the Real Property or any improvements; GE has not been served with any notices of non-compliance and, to Sellers' Knowledge, there is no issue that would give rise to a zoning or other land use notice of non-compliance regarding the Real Property and any improvements, other than Environmental Laws and Nuclear Laws for which Sellers' only representations and warranties are set forth in Sections 4.9 and 4.13 , respectively; and to Sellers ' Knowledge, as of the Contract Date, there are no special assessments or Encumbrances imposed by Governmental Authorities that could be reasonably be expected to result in any material charge being levied or assessed or in the creation of any material Encumbrance. 4.7 Real Property Agreements. The agreements listed on Schedule 4.7 include all leases, mortgages, deeds of trust, easements, rights of way, licenses, crossing agreements and 31 4858-8955-7603.vl
crossing consents, co-tenancy agreements and other agreements and rights under which Sellers hold or have granted rights to, or are binding on, the Real Property including all amendments, notices and renewables thereto (exclusive of noncurrent term extensions) (collectively, the "Real Property Agreements") and, together with the fee interests held by Sellers, describe all Real Property used, or held for use, in, or necessary for, Buyer's possession, use or occupancy of, the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center. Except as set forth in Schedule 4.7, all such Real Property Agreements are valid and in force and effect. There is not, with respect to any Real Property Agreement, any material breach or event of default or an event which has occurred and which (whether with or without notice, lapse of time or both) would constitute a default existing on the part of the Sellers, or to the Knowledge of Sellers, on the part of any other party thereto. 4.8 Insurance. Schedule 4.8 lists all material insurance policies maintained as of the Contract Date by Sellers with respect to the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center, including the Available Insurance Policies, with the term, limits, and subject to the indicated deductibles with the insurance carriers as set forth in as set forth in Schedule 4.8. Schedule 6.18.3 lists the Available Insurance Policies with the term, limits, and subject to the indicated deductibles with the insurance carriers as set forth in Schedule 6.18.3. Except as set forth in Schedule 4.8, all Available Insurance Policies covering the Assets, the nuclear liability insurance policies from ANI and other forms of insurance relating to the Assets are in full force and effect, all premiums with respect thereto covering all periods up to and including the Contract Date have been paid (other than retroactive premiums which may be payable with respect to the ANI policy), and no written notice of cancellation, nonrenewal or termination has been received with respect to any such policy which was not replaced on substantially similar terms prior to the date of such cancellation. 4.9 Environmental Matters. 4.9.1 Set forth in Schedule 4.9.1 is a list of the material Environmental Permits required for the ownership and possession of the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center held by Sellers as of the Contract Date. 4.9.2 Sellers have delivered true and complete copies of the Characterization Reports within Sellers' possession or control to Buyer prior to the Contract Date. With respect to the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center, except as disclosed in Schedule 4.9.2 (including in the Characterization Reports listed therein): 4.9.2.1 There are no proceedings pending or, to the Knowledge of GE, threatened in writing alleging that Sellers are responsible for Environmental Liabilities (other than those under Nuclear Laws) that, if adversely determined, would reasonably be expected to have a Seller Material Adverse Effect; 4.9.2.2 There are no proceedings pending or, to the Knowledge of GE, threatened in writing that would reasonably be expected to result in the revocation, termination, modification or amendment of any such material Environmental Permit, and, for the three years preceding the Contract Date, GE has not failed to make in a timely fashion any application or other filing required for the renewal of any such Environmental Permit which failure would reasonably 32 4858-8955-7603.vl
be expected to result in such Environmental Permit's termination or being revoked, terminated, suspended or adversely modified, and where such termination, revocation, suspension, or modification would reasonably be expected to have a Seller Material Adverse Effect; 4.9.2.3 To the Knowledge of GE, the Vallecitos Nuclear Center is, and has been for the past three years preceding the Contract Date, in compliance in all material respects with all terms, conditions and provisions of, and GE has not received any written notice from any Governmental Authority that it is not or has not been in material compliance (except for any such non-compliance that has been cured in all material respects) with all applicable Environmental Laws and all Environmental Permits listed in Schedule 4. 9 .1 , in each case, except as would not reasonably be expected to have a Seller Material Adverse Effect; 4.9.2.4 There are no Environmental Claims pending or, to the Knowledge of GE or GEH, threatened in writing against GE or GEH, with respect to the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center that would reasonably be expected to have a Seller Material Adverse Effect; and 4.9.2.5 To the Knowledge of GE, Seller has not caused any Releases of Hazardous Substances at the Vallecitos Nuclear Center in the [ ] preceding the Contract Date that would be reasonably likely to give rise to an Environmental Claim against Sellers or require Remediation under applicable Environmental Law that, in either case, would reasonably be expected to have a Seller Material Adverse Effect. 4.9.3 The representations and warranties set forth in this Section 4.9 are Sellers ' sole and exclusive representations and warranties regarding any environmental, health, and safety matters and Environmental Laws. 4.10 Certain Contracts and Arrangements. 4 .10 .1 Neither Seller is, as of the Contract Date, a party to any contract, agreement, Tangible Personal Property lease, commitment, understanding or instrument (each a "Contract") which is material to the ownership, present use, maintenance or possession of, or access to, the Assets or the Decommissioning of the Assets, including the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center exce t for : i those Contracts listed in Schedule 4 .10 .1 collectivel the "VNC Contracts" ; 4.10.2 Sellers have delivered, or have caused to be delivered, to Buyer true, complete and correct copies (or in the case of oral VNC Contracts, summaries (in reasonable detail of all material provisions)) of the VNC Contracts (in each case as amended or modified to date). Each such VNC Contract is valid, binding and enforceable agreement of the applicable Seller or its Affiliates, as applicable, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, 33 4858-895 5-7603.vl
moratorium and similar Laws of general applicability relating to or affecting creditors ' rights and to general equity principles, and is in full force and effect. 4.10.3 Except as set forth on Schedule 4.10.3 , (i) no breach, violation, default or event exists with respect to any of the VNC Contracts that, with notice or lapse of time or both, would constitute a default on the part of Sellers, or to the Knowledge of Sellers, on the part of any of the parties thereto, except for any such breach or default that, individually or in the aggregate would not reasonably be expected to have a Seller Material Adverse Effect; and (ii) no party to any of the VNC Contracts has provided written notice of its intent to exercise any termination rights with respect thereto or, to the Knowledge of Sellers, threatened in writing to cancel such relationship, other than in the ordinary course or for any such termination rights or cancelations that would not have, individually or in the aggregate, a Seller Material Adverse Effect. 4 .10 .4 The consummation of the transactions contemplated hereby and the Ancillary Agreements will not require under any VNC Contract a consent or approval from any Person other than those listed in Schedule 4 .3 .1 , except in each case for those consents and approvals which would not have, individually or in the aggregate, a Seller Material Adverse Effect. 4 .10. 5 All leases, lease amendments, lease guaranties, work letter agreements, improvement agreements, subleases, assignments, licenses and other agreements relating to rights of occupancy of the Real Property that will survive the Closing Date and any amendments thereto are accurately described on Schedule 4.10.5 attached hereto (the "VNC Leases"). Seller has delivered to Buyer true, correct and complete copies of all of the Leases. No breach, violation, default or event exists with respect to any of the VNC Leases that, with notice or lapse of time or both, would constitute a default on the part of Sellers, or to the Knowledge of Sellers, on the part of any of the parties thereto, except for any such breach or default that, individually or in the aggregate would not reasonably be expected to have a Seller Material Adverse Effect. No party to any of the VNC Leases has provided written notice of its intent to exercise any termination rights with respect thereto or, to the Knowledge of Sellers, threatened in writing to cancel such relationship, other than in the ordinary course or for any such termination rights or cancelations that would not have, individually or in the aggregate, a Seller Material Adverse Effect. 4.11 Legal Proceedings. As of the Contract Date, there is no suit, claim, action, arbitration, audit, hearing, inquiry, prosecution, contest, examination, investigation, litigation or other proceeding pending, at Law or in equity, or before or by any Governmental Authority, or, to the Knowledge of Sellers, threatened against or relating to Sellers or any of their Affiliates which relates, in whole or in part, to the Assets or Assumed Liabilities and which, individually or in the aggregate, would reasonably be expected to be material to Sellers' ownership or operation of the Assets. None of the Sellers or their Affiliates (in respect of the Assets or Assumed Liabilities), the Assets, or the Assumed Liabilities is subject to any material unsatisfied settlement, stipulation, order, writ, judgment, injunction, decree, ruling, determination or award of any court or of any Governmental Authority. 4.12 Permits; Compliance with Applicable Laws. 4.12.1 Sellers have all material permits, licenses, registrations, certificates, franchises and other governmental authorizations, consents and approvals used in, or necessary for 34 4858-895 5-7603.vl
the ownership, lease, use, or possession of, the Assets by Sellers as of the Contract Date (the "Permits"); provided that "Permits" does not include the Environmental Permits, the NRC Licenses, and the California Licenses which are addressed exclusively in Sections 4.9, 4.13 , and 4.14, respectively. Sellers have not received any written notification which remains unresolved that it is in violation of any of such Permits applicable to the Assets and no Governmental Authority is threatening in writing to revoke, adversely modify or impose any condition or sanction in respect of any such Permit or has commenced proceedings to revoke, adversely modify or impose any condition or sanction in respect of any such Permit. Sellers are, and have been during the three (3) year period prior to the date hereof, in compliance with all Permits and Laws of any Governmental Authority applicable to the Assets, excepting any such failures in compliance or violations that would not reasonably be expected to have, individually or in the aggregate, a Seller Material Adverse Effect. 4.12.2 Schedule 4.12.2 sets forth all Permits, other than Transferable Permits, applicable to the Assets. 4.13 NRC Licenses. GEH holds the NRC Licenses (as may be amended as provided under Section 6.1.2) for the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center, which are all of the licenses, permits, consents and approvals from NRC that are necessary for the ownership, operation, and possession of the Vallecitos Licensed Facilities pursuant to the requirements of all Nuclear Laws. GEH has not received any written notification which remains unresolved that it is in violation of any of the NRC Licenses, or any order, rule, regulation, or decision of the NRC with respect to the Assets. Sellers are in material compliance with all Nuclear Laws, except for violations which, individually or in the aggregate, would not reasonably be expected to have a Seller Material Adverse Effect. 4.14 California Licenses. GEH holds all licenses, permits, and other consents and approvals from the State of California that are applicable to the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center and that are necessary to the ownership and possession of the Vallecitos Licensed Facilities (the "California Licenses"), pursuant to the requirements of all Nuclear Laws and as set forth in Schedule 4.14. GEH has not received any written notification which remains unresolved that it is in violation of any of the California Licenses, or any order, rule, regulation, or decision of the State of California with respect to the Assets. Sellers are in material compliance with all Nuclear Laws, except for violations which, individually or in the aggregate, would not reasonably be expected to have a Seller Material Adverse Effect. 4.15 Tax Matters. Except with respect to the portion of the Assets that are part of the NDF: all material Tax Returns of a Seller required to be filed for taxable periods ended prior to the Closing Date regarding the ownership, possession or use of the Assets have been filed and are true, correct, and complete in all material respects; and all material Taxes due and attributable to the ownership, possession or use of the Assets have been paid, except where such Taxes are being contested in good faith through appropriate proceedings; no notice of deficiency or assessment has been received from any taxing authority with respect to any liabilities for Taxes of a Seller attributable to the ownership, possession, or use of the Assets that has not been fully paid or finally settled, except for matters that are being contested in good faith through appropriate proceedings; there are no liens (other than Permitted Encumbrances) on any of the Assets that arose in connection with any failure (or alleged failure) to pay any Tax or file any Tax Return; except as 35 4858-8955-7603.vl
set forth on Schedule 4.15 , there are no discussions, audits or proceedings currently pending or threatened by any Governmental Authority for the assessment or collection of Taxes attributable to the ownership, possession or use of the Assets (and neither any of the Sellers nor any of their respective Affiliates has received written notice of any such proceeding); with respect to jurisdictions in which the Sellers and their respective Affiliates have not filed Tax Returns, no claim for the assessment or collection of Taxes that are due and unpaid has been asserted against Sellers or their respective Affiliates with respect to the Assets; since January 1, 2020, Seller has not made any payments to any Governmental Authority in lieu of any Taxes, and there are no such payments which would become payable in connection with the transactions contemplated by this Agreement, with respect to the Real Property or the Tangible Personal Property included in the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center; Sellers initially obtained the Assets for their own use, and the transactions contemplated by this Agreement are outside the course of Seller's regular business as it relates to the Assets; Seller has not participated in a transaction with respect to the Assets that is described as a "listed transaction" within the meaning of Treasury Regulation§ 1.6011-4(b)(2). 4.16 NDF. 4.16.1 At the time of the Closing, the NDF will be a trust established under the NDF Trust Agreement that validly exists under the Laws of the Commonwealth of Pennsylvania, with all requisite authority to conduct its affairs as it now does. The NDF is in compliance in all material respects with all applicable Nuclear Laws. 4.16.2 At the time of the Closing, the NDF will (i) be a grantor trust for Income Tax purposes pursuant to Sections 671- 678 of the Code and (ii) has never been classified as a regarded entity for Income Tax purposes. 4.16.3 Subject only to the receipt of Seller's Required Regulatory Approvals and the terms of the NDF Trust Agreement, Sellers have or as of the Closing will have all requisite authority to cause the assets of the NDF to be transferred to the Buyer. 4.16.4 At the time of the Closing, the Assets in the NDF shall be comprised as provided in Section 6.13.1. 4.16.5 As of the Closing, there are no (i) Liabilities that may materially affect the financial position of the NDF or (ii) Encumbrances for Income Taxes upon the assets of the NDF other than statutory liens for Income Taxes not yet due and payable. 4.17 Payment of Fees. 4 .17 .1 Sellers have paid all Spent Nuclear Fuel Fees and all Liabilities under the GEH Standard Spent Fuel Disposal Contract, including the obligations relating to payment of the one-time fees (principal plus interest) required to be paid under the GEH Standard Spent Fuel Disposal Contract. 36 4858-8955-7603.vl
4.17.2 Sellers have paid all Liabilities for DOE Decontamination and Decommissioning Fees relating to Nuclear Fuel at the Vallecitos Nuclear Center prior to the Closing Date. 4.18 Exclusivity of Representations and Warranties. Neither Seller nor any of their respective Affiliates or Representatives are making any representation or warranty of any kind or nature whatsoever, oral or written, express or implied, relating to the Assets, the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center (including any maintenance, repair, condition, design, performance, profitability, projections, value, merchantability or fitness for any particular purpose of the Assets, the Vallecitos Licensed Facility or the Vallecitos Nuclear Center), except as otherwise expressly set forth in this ARTICLE IV or in any certificate delivered pursuant to this Agreement or any Ancillary Agreement, and Sellers hereby disclaim any such other representations or warranties. ARTICLE V REPRESENTATIONS AND WARRANTIES OF BUYER Buyer represents and warrants to Sellers, as of the date hereof and as of the Closing Date, as follows : 5.1 Organization; Qualification. Buyer is a limited liability company duly formed, validly existing and in good standing under the Laws of the State of Delaware. Buyer has all requisite limited liability power and authority to own, lease and operate its properties and to carry on its business as it is now being conducted. Buyer has heretofore delivered or made available to Sellers complete and correct copies of its certificate of formation and operating agreement as currently in effect. Buyer is, or on the Closing Date will be, qualified to conduct business in the State of California. 5.2 Buyer Capability. Buyer is financially capable and properly qualified to undertake and perform its obligations under this Agreement and the Ancillary Agreements, and is properly licensed, equipped, and organized to do so. The audited financial statements of the Parent Guarantor and its consolidated subsidiaries as of and for the years ended December 31 , 2020, and December 31 , 2021 , and the unaudited financial statements of the Parent Guarantor and its consolidated subsidiaries as of and for the year ended December 31 , 2022, heretofore furnished by Buyer to Sellers, are true and correct and present fairly, accurately, and completely the financial position of the Parent Guarantor as of the dates and for the periods for which the same have been furnished, and all such financial statements have been prepared pursuant to and in accordance with GAAP applied on a consistent basis. 5.3 Authority. Buyer has full corporate power and authority to execute and deliver this Agreement and the Ancillary Agreements, and to consummate the transactions contemplated hereby or thereby. The execution and delivery of this Agreement and the Ancillary Agreements as applicable, and the consummation of the transactions contemplated hereby or thereby, have been duly and validly authorized by all necessary corporate action required on the part of each of Buyer and Parent Guarantor, and no other corporate proceedings on the part of Buyer or Parent Guarantor are necessary to authorize this Agreement and the Ancillary Agreements, as applicable, or to consummate the transactions contemplated hereby or thereby. This Agreement has been duly 37 4858-8955-7603.vl
and validly executed and delivered by Buyer, and assuming that this Agreement constitutes a valid and binding agreement of Sellers and, subject to the receipt of Buyer's Required Regulatory Approvals, constitutes a valid and binding agreement of Buyer, enforceable against Buyer in accordance with its terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar Laws of general applicability relating to or affecting creditors' rights and to general equity principles. Each of the Ancillary Agreements, when executed and delivered at the Closing by Buyer, will constitute a valid and binding agreement of Buyer, enforceable against Buyer in accordance with its terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar Laws of general applicability relating to or affecting creditors' rights and to general equity principles. 5.4 Membership Interests. All of the issued and outstanding membership interests in Buyer are, directly or indirectly, owned by Parent Guarantor. 5.5 Consents and Approvals; No Violation. 5.5.1 Subject to the receipt of Buyer's Required Regulatory Approvals, neither the execution and delivery of this Agreement and the Ancillary Agreements by Buyer nor the consummation of the transactions contemplated hereby or thereby will (i) conflict with or result in any breach of any provision of the certificate of formation or operating agreement of Buyer; (ii) result in a default (or give rise to any right of termination, cancellation or acceleration) under any of the terms, conditions or provisions of any note, bond, mortgage, indenture, agreement, lease or other instrument or obligation to which Buyer is a party or by which any of its assets may be bound, except for such defaults (or rights of termination, cancellation or acceleration) as to which requisite waivers or consents have been obtained or which would not, individually or in the aggregate, have a material adverse effect on the business, assets, operations or condition (financial or otherwise) of Buyer or on the ability of Buyer to perform its obligations hereunder or under the Ancillary Agreements (a "Buyer Material Adverse Effect"); or (iii) violate any Laws applicable to Buyer, which violations, individually or in the aggregate, would create a Buyer Material Adverse Effect. 5.5.2 Except as set forth in Schedule 5.5.2, no declaration, filing or registration with, or notice to, or authorization, consent or approval of any Governmental Authority is necessary for the execution of this Agreement and the Ancillary Agreements and the consummation by Buyer of the transactions contemplated by this Agreement or the Ancillary Agreements, other than (i) such declarations, filings, registrations, notices, authorizations, consents or approvals which, if not obtained or made, will not, individually or in the aggregate, create a Buyer Material Adverse Effect; or (ii) such declarations, filings, registrations, notices, authorizations, consents or approvals which become applicable to Buyer as a result of the specific regulatory status of Sellers (or any of its Affiliates) or the result of any other facts that specifically relate to the business or activities in which Sellers (or any of its Affiliates) is or proposes to be engaged. 5.6 Legal Proceedings. There are no claims, actions, proceedings or investigations pending or, to the Knowledge of Buyer, threatened against Buyer before any court, arbitrator, mediator or Governmental Authority which, individually or in the aggregate, would reasonably be expected to (i) result in a Buyer Material Adverse Effect; (ii) prohibit or restrain the performance 38 4858-8955-7603.vl
by Buyer of this Agreement or any of the Ancillary Agreements or the consummation of the transactions contemplated hereby or thereby. Buyer is not subject to any outstanding Governmental orders which would have a Buyer Material Adverse Effect. 5.7 Absence of Buyer Material Adverse Effect; Liabilities. Except as disclosed in Schedule 5.7 or the financial statements described in Section 6.2.2, Buyer has not incurred debt for borrowed money or guaranteed the indebtedness of any other Person. Buyer has no assets or Liabilities, other than assets represented by capital contributed to Buyer by Parent Guarantor and its Affiliates and assets and Liabilities existing by reason of this Agreement or the Ancillary Agreements. As of the Contract Date, Buyer has not incurred, created or assumed any Encumbrance on any of its properties, revenues or rights, whether now owned or hereafter acquired except those created in this Agreement of the Ancillary Agreements. Prior to the Contract Date, none of Buyer or its Affiliates have taken any action that would be in contravention of Section 6.2.1 if it had occurred following the Contract Date. 5.8 Transfer of Decommissioning Funds. The NDF and the NDF Trust Agreement will satisfy the NRC ' s requirements for decommissioning trust provisions in 10 C.F.R. §§ 50.75(h)(l) and 50.82(a)(8) as well as the requirements under the Laws of the State of California. 5.9 Foreign Ownership or Control. Buyer conforms to the restrictions on foreign ownership, control or domination contained in Sections 103d and 104d of the Atomic Energy Act of 1954, as applicable, and the NRC 's regulations in 10 C.F.R. § 50.38. Buyer currently is not owned, controlled or dominated by a foreign entity and neither will become owned, controlled, or dominated by a foreign entity before the Closing. 5.10 Permit Qualifications. Buyer will be, as the owner of the Assets, qualified to hold all of the Permits and Environmental Permits. 5.11 Buyer' s Reliance. Buyer has not relied and is not relying on any statement, representation or warranty, oral or written, express or implied (including any representation or warranty as to merchantability or fitness for a particular purpose), made by any Seller or any of their Affiliates or Representatives, except as expressly set forth in this Agreement, any Ancillary Agreement and in any certificate delivered pursuant hereto or thereto. ARTICLE VI COVENANTS OF THE PARTIES 6.1 Sellers' Conduct of Business Relating to the Assets. 6.1.1 During the Pre-Closing Period, except for the matters set forth on Schedules 6 .1.1 and 6 .14, Sellers shall operate, use and maintain, or cause to be operated, used and maintained, the Assets, including without limitation, the Vallecitos Licensed Facilities, the Vallecitos Nuclear Center and the Hillside Storage Facility, in a manner consistent with the ordinary course of nuclear facilities entering decommissioning consistent with Good Industry Practices and in compliance in all material respects with applicable Laws, the NRC Licenses, Permits and Environmental Permits; it being understood that any actions deemed reasonably necessary in the operation, use and maintenance of the Assets in accordance with Good Industry 39 4858-895 5-7603.vl
Practices or any NRC Commitments shall be deemed to be in the ordinary course. Without limiting the generality of the foregoing, and, except as contemplated in this Agreement during the Pre-Closing Period and any NRC Commitments, without the prior written consent of Buyer (unless the requirement for such consent would be prohibited by Law), which consent will not be unreasonably withheld, conditioned or delayed, Sellers shall not directly or indirectly do, and shall not issue any consent or otherwise take any action that permits, any of the following with respect to the Assets: 6.1.1.1 sell, lease, pledge, mortgage, assign, encumber, restrict, dispose of, or otherwise transfer or grant any right with respect to the Assets other than granting or suffering to exist a Permitted Encumbrance; 6 .1.1.2 except as set forth in Schedule 6 .1.1 , materially amend or extend or voluntarily terminate prior to the expiration date thereof any of VNC Contracts or the Real Property Agreements, VNC Leases or any material Permit or Environmental Permit or waive any default by any other party thereto, other than (i) as may be required to secure the transfer, reissuance or procurement (either partial or in full) of any such Permit or Environmental Permit; (ii) in the case of VNC Contracts (other than any VNC Contract with DOE), with cause to the extent consistent with Good Industry Practices and with prior written notice to Buyer; or (iii) as may be required in connection with Sellers' obligations to Buyer under this Agreement; 6.1.1.3 fail to maintain in effect or amend any Available Insurance Policy issued for the benefit of the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center in a manner outside of Good Industry Practices; 6.1.1.4 move any Nuclear Materials or Hazardous Substances to the Vallecitos Nuclear Center; 6.1.1.5 make any material improvements or modifications outside the ordinary course of business to the Vallecitos Licensed Facilities, Vallecitos Nuclear Center or the Hillside Storage Facility, except for Decommissioning activities within the scope of the Pre-Closing Decommissioning Activities or as required by Law; 6.1.1.6 incur any material obligation or commitment related to the Assets, other than Excluded Liabilities or those (a) conducted by Buyer or its contractors, (b) those incurred by Sellers in the ordinary course of business and in accordance with Good Industry Practices, (c) exigent or emergent expenses incurred by Sellers in accordance with Good Industry Practices or (d) as otherwise expressly permitted or excepted by this Section 6 .1 .1; 6 .1.1. 7 (a) settle or compromise any claim, suit, action, litigation, arbitration, mediation, or other proceeding (whether civil or criminal, administrative, regulatory or otherwise) (collectively "Action") that results in an increase in any material respect to the Assumed Liabilities existing on the Contract Date or (b) waive, terminate or release any material Action or material right that is part of the Assets or Assumed Liabilities against any other Person; 6.1.1.8 except as required by any Law or generally accepted accounting principles, or as specifically contemplated in this Agreement, change, in any material respect, their 40 4858-8955-7603.vl
Tax practices or policies with respect to the Assets (including making new Tax elections or changing Tax elections and settling Tax controversies not in the ordinary course of business) or make any change in any method or accounting or accounting practice with respect to the Assets, in each case to the extent such change or settlement would be binding on Buyer; or 6.1.1.9 agree to enter into any of the transactions set forth in the foregoing provisions of this Section 6.1.1. 6.1.2 Without limiting anything to the contrary in Section 6.1.1 , Sellers shall: 6.1.2.1 use Commercially Reasonable Efforts to obtain an estoppel certificate (or similar release), dated as of a recent date preceding the Closing Date, from any Person ( other than the Buyer or its Affiliates) performing any Pre-Closing Decommissioning Activities pursuant to a contract or agreement that will be part of the Assets (as Assumed Contracts or otherwise) or evidences any of the Assumed Liabilities, signed by a duly authorized representative of such Person, and certifying that the contract or agreement with such Person in respect of such Pre-Closing Decommissioning Activities is in full force and effect, that there are no existing defaults by GEH under such contract or agreement, and to the knowledge of such Person, no event has occurred which (whether with or without notice, lapse of time or both) would constitute a default by such Person under such contract or agreement; 6.1.2.2 prior to or within a reasonable time after the Contract Date, but in any event prior to the Closing Date, (i) permanently cease operations of the Nuclear Test Reactor and (ii) transition the Nuclear Test Reactor to a "cold" or non-active status, (iii) provide written certification of the cessation of operations to the NRC, and (iv) submit a request to amend the Nuclear Test Reactor license to the NRC to authorize possession only, and to take such steps as are necessary to permanently disable the ability to restart the reactor; 6.1.2.3 Use Commercially Reasonable Efforts to renew permits referenced in Item 1 of Schedule 6.1.2; and 6.1.2.4 Exercise its termination right as indicated in Item 1 of Schedule 6.1.1 and not renew the agreement listed in Item 2 of Schedule 6.1.1. 6.2 Buyer's Conduct of Business. 6.2.1 During the Pre-Closing Period, Buyer shall not: 6.2.1.1 Sell or transfer the membership interests in Buyer to any third party, without the prior written consent of Sellers; 6.2.1.2 Engage in any business activity or incur any Liability by or on behalf of Buyer, except as necessary in connection with the transactions contemplated by this Agreement; 6.2.1.3 Be or become owned, controlled or dominated by a foreign entity; or 41 4858-895 5-7603.vl
6.2.1.4 Agree to take any action or enter into any transaction that would violate the foregoing provisions of this Section 6 .2 .1. 6.2.2 During the Pre-Closing Period, Buyer shall deliver to Sellers: 6.2.2.1 As soon as available and in any event within sixty (60) days after the end of each of the first three quarters of each fiscal year of the Parent Guarantor during the Pre-Closing Period, a copy of the Parent Guarantor unaudited, reviewed consolidated balance sheet as of the end of such quarter and the related consolidated statement of income and cash flow statement of the Parent Guarantor for the portion of the fiscal year ending on the last day of such quarter, in each case prepared in accordance with GAAP, (subject to the absence of footnotes and to year-end audit adjustments), together with a certificate of the chief financial officer of the Parent Guarantor to the effect that such financial statements fairly present, in all material respects, the consolidated financial condition of the Parent Guarantor as of the date thereof and results of operations for the period then ended; 6.2.2.2 As soon as available and in any event within one hundred twenty (120) days after the end of each fiscal year of the Parent Guarantor during the Pre-Closing Period, an audited copy of the consolidated balance sheet of the Parent Guarantor as of the last day of such fiscal year and the related audited consolidated statements of income, retained earnings, cash flows, and notes to consolidated financial statements of the Parent Guarantor for such fiscal year, in each case prepared in accordance with GAAP, together with an opinion of certified public accountants of recognized national standing. 6.3 Access to Information. 6 .3 .1 During the Pre-Closing Period, Sellers will, during ordinary business hours, upon reasonable notice and subject to compliance with all applicable NRC rules and regulations and other applicable Laws (i) give Buyer and Buyer' s Representatives reasonable access to all Sellers management personnel engaged in the management of the Assets and all business books and records with respect to the Assets and Assumed Liabilities as well as plants, offices and other facilities and properties constituting the Assets; (ii) permit Buyer to make such reasonable inspections thereof as Buyer may reasonably request; (iii) furnish Buyer with such financial information, operational data and other information with respect to the Assets and Assumed Liabilities in possession of Sellers as Buyer may from time to time reasonably request: provided that, Sellers shall not be required to create analyses or information, convert documents to electronic format in bulk, or conduct searches of physical records, but will provide reasonable access at its offices to its physical records for Buyer to conduct such searches; and (iv) furnish Buyer a copy of each material report, schedule or other document filed or received by Sellers with respect to the Assets and Assumed Liabilities with the NRC or any other Governmental Authority having jurisdiction over any of the Assets, including the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center, including since the date of this Agreement; provided, however, that ( a) any such investigation shall be conducted in such a manner as not to interfere unreasonably with the use or management of the Vallecitos Licensed Facilities; (b) Sellers shall not be required to take any action which would constitute a waiver of the attorney-client privilege; (c) Sellers need not supply Buyer with any information that Sellers are legally or contractually (pursuant to any agreement delivered to Buyer prior to the Contract Date, provided that Buyer shall be entitled to ask Sellers 42 4858-895 5-7603.vl
to use Commercially Reasonable Efforts to obtain consent from the contractual counterparty to the extent such prohibition exists) prohibited from supplying; and (d) Sellers shall not be required to take, or cause to be taken, any sampling, testing or other intrusive indoor or outdoor investigation of soil, subsurface strata, surface water, groundwater, sediments or ambient air or other media at or in connection with any plants, facilities or properties. Notwithstanding anything to the contrary contained in this Agreement, Buyer shall not conduct any environmental investigation at the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center (including any sampling, testing or other intrusive indoor or outdoor investigation of soil, subsurface strata, surface water, groundwater, sediments, building materials, ambient air or anything else at or in connection with any such property), except with the prior written consent of the Sellers, which shall be given at the sole discretion of Sellers. 6.3.2 Buyer agrees that, prior to the Closing Date, it will not contact with any vendors, suppliers, employees, or other contracting parties of Sellers or Sellers' Affiliates with respect to any aspect of the Assets, including the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center, or the transactions contemplated hereby, without the prior written consent of Sellers, which consent shall not be unreasonably withheld, conditioned or delayed. 6.4 Protection of Proprietary Information. 6.4.1 From and after the Contract Date: (i) Buyer shall use and disclose, and shall cause their Representatives, including Parent Guarantor, to use and disclose, Sellers Proprietary Information only to the extent necessary to consummate the transactions contemplated by, and perform their obligations under, this Agreement and the Ancillary Agreements; and (ii) Sellers shall use and disclose, and shall cause its Representatives to use and disclose, Buyer' s Proprietary Information only to the extent necessary to consummate the transactions contemplated by, and perform its obligations under, this Agreement and the Ancillary Agreements. Any disclosure to third parties by either Sellers or Buyer shall only be made subject to confidentiality agreements with such third parties that are at least as stringent as the requirements of this Section 6.4. If the Closing occurs, the obligations of the Parties under this Section 6.4.1 shall expire as of the Closing Date. 6.4.2 Upon Buyer's or Sellers' (as the case may be) prior written approval (which approval shall not be unreasonably withheld, conditioned or delayed), Sellers, or Buyer or Parent Guarantor (as the case may be) may provide Proprietary Information of any other Party to the NRC or any other Governmental Authority having jurisdiction over the Assets or any portion thereof, as may be necessary to obtain Sellers' Required Regulatory Approvals or Buyer' s Required Regulatory Approvals, respectively. The disclosing Party shall seek confidential treatment for the Proprietary Information provided to any such Governmental Authority and the disclosing Party shall notify the other Party whose Proprietary Information is to be disclosed, as far in advance as reasonably practical, of its intention to release to any Governmental Authority any such Proprietary Information. In the event that disclosure of Proprietary Information is required by order of a court or other Governmental Authority or by subpoena or other similar legal process, the Party subject to such order, subpoena or other legal process shall, to the extent permitted by Law, notify the other Party whose Proprietary Information is to be disclosed and the Parties shall consult and cooperate in seeking a protective order or other relief to preserve the confidentiality of Proprietary Information. 43 4858-895 5-7603.vl
6.4.3 Sellers or Buyer or Parent Guarantor (as the case may be) may, without the prior consent of the other Party, disclose Proprietary Information of any other Party as may be necessary to comply generally with any applicable Laws or with the rules of any applicable stock exchange. The disclosing Party shall notify the other Party whose Proprietary Information is to be disclosed, as far in advance as reasonably practical, of its intention to release to any third party any such Proprietary Information. 6.4.4 Notwithstanding anything to the contrary in the foregoing, nothing in this Section 6.4 authorizes or permits Buyer or Parent Guarantor to disclose any Third-Party Proprietary Information that Buyer or Parent Guarantor obtains as part of the Sellers Proprietary Information to any other Person. Buyer and Parent Guarantor each acknowledge and agree that to the extent Sellers are prohibited or restricted by any non-disclosure or confidentiality obligation to any third party from disclosing any Third-Party Proprietary Information to Buyer or Parent Guarantor, Sellers shall have the right to not disclose such Third-Party Proprietary Information to Buyer and Parent Guarantor until Buyer and Parent Guarantor have reached agreement with such third party and such third party has notified Sellers in writing that Sellers may disclose such Third-Party Proprietary Information to Buyer and Parent Guarantor. Sellers shall notify Buyer if there is any Third-Party Proprietary Information of which Sellers are aware that Sellers are prohibited or restricted from disclosing to Buyer or Parent Guarantor, and advise Buyer and Parent Guarantor of such third party so that Buyer and Parent Guarantor may make appropriate arrangements with such third party. Sellers' failure to disclose any Third-Party Proprietary Information pursuant to this Section 6.4.4 shall not serve as the basis for a claim of any breach of a representation, warranty or other obligation of Sellers hereunder. 6.4.5 The Confidentiality Agreement shall terminate and be of no further force or effect after the Closing Date except for remedies for any breach of the Confidentiality Agreements arising prior to the Closing Date. After the Closing Date, Sellers shall keep confidential all Proprietary Information provided by Buyer or Parent Guarantor or which Sellers possesses with respect to the Assets, to the extent permitted by Law, and to the same extent and under the same conditions applicable to the obligations of Buyer and Parent Guarantor prior to the Closing Date with respect to Sellers Proprietary Information (other than Third-Party Proprietary Information) as contained in this Agreement. After the Closing Date, Buyer and Parent Guarantor shall keep confidential all Proprietary Information provided by Sellers or which Buyer or Parent Guarantor possesses with respect to the Assets, to the extent permitted by Law, and to the same extent and under the same conditions applicable to the obligations of Sellers prior to the Closing Date with respect to Buyer' s Proprietary Information as contained in this Agreement, except that Buyer and Parent Guarantor's obligations with respect to any Third-Party Proprietary Information obtained by Buyer or Parent Guarantor as part of the Sellers Proprietary Information shall be subject to Section 6.4.4. 6.4.6 If this Agreement is terminated before the Closing, Buyer and Parent Guarantor shall, within thirty (30) days after receipt of a written request from Sellers, at their option, return or destroy (with such destruction to be certified following Sellers' request) Sellers Proprietary Information in the possession or control of Buyer or Parent Guarantor or their Representatives, and Sellers shall, within thirty (30) days after receipt of a written request from Buyer or Parent Guarantor, at their option, return or destroy (with such destruction to be certified 44 4858-895 5-7603.vl
following Sellers ' request) Buyer's Proprietary Information in the possession or control of Sellers or its Representatives. Notwithstanding the foregoing, a recipient or another Party's Proprietary Information shall not be required to return or destroy such other Party's Proprietary Information to the extent that (i) it directly relates to a matter that is or is expected to be the subject oflitigation or claims, (ii) is commingled with other electronic records that are collected and maintained in a separate secure facility as part of information technology backup procedures in accordance with the normal course of business, (iii) is included in a Party's disclosures to its or its Affiliate 's board of directors or similar governing body or the records of deliberations of such body in connection with the consideration of the authorization and approval of this Agreement and the transactions contemplated hereby, (iv) the recipient is required to retain such Proprietary Information under applicable Law, or (v) the recipient is a legal or other professional advisor to a Party with professional responsibilities to maintain client confidences. 6.5 Expenses. Except to the extent specifically provided herein, whether or not the transactions contemplated hereby are consummated, each Party shall bear its own costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby, including the cost of legal, technical and financial consultants, and the cost of filing for and prosecuting applications for in the case of Sellers, Sellers' Required Regulatory Approvals, and in the case of Buyer, Buyer's Required Regulatory Approvals. 6.6 Further Assurances; Cooperation. 6.6.1 Subject to the terms and conditions of this Agreement, each of the Parties shall use Commercially Reasonable Efforts to take, or cause to be taken, all action, and to do , or cause to be done, all things necessary, proper or advisable under applicable Laws to consummate and make effective the sale, transfer, conveyance and assignment of the Assets, the assignment and assumption of the Assumed Liabilities, and the exclusion of the Excluded Liabilities and the Excluded Assets, including using Commercially Reasonable Efforts to ensure all of Sellers' Required Regulatory Approvals and Buyer's Required Regulatory Approvals are obtained, and the conditions precedent to each Party's obligations hereunder are satisfied. Without limiting the generality of the foregoing, from time to time after the Closing, Sellers and Buyer shall execute and deliver such documents as the other Party may reasonably request, without further compensation and at their own respective expense, in order to more effectively evidence the transfer, conveyance and assignment, of the Assets, Buyer's assumption of the Assumed Liabilities or to more effectively vest in Buyer such title to the Assets, subject to the Permitted Encumbrances. Except as may be required by Law, neither Buyer or Parent Guarantor nor Sellers shall, without the prior written consent of the others, advocate or take any action which would reasonably be expected to prevent or materially impede, interfere with or delay the transactions contemplated by this Agreement or which could reasonably be expected to cause, or to contribute to causing, the other Party or Parties to receive less favorable regulatory treatment than that sought by the Party or Parties. 6.6.2 At the Closing and to the extent that Sellers' rights under any VNC Contract may not be assigned without the consent of another Person which consent has not been obtained, this Agreement shall not constitute an agreement to assign the same if an attempted assignment would constitute a breach thereof or be unlawful, and Sellers and Buyer shall use Commercially Reasonable Efforts for a reasonable period of time after Closing to obtain any such required 45 4858-895 5-7603.vl
consent( s) as promptly as possible. During such reasonable period of time, the applicable Seller and Buyer will cooperate in a mutually agreeable arrangement under which Buyer would, in compliance with Law, obtain the benefits and assume the Liabilities and bear the economic burdens associated with such VNC Contract in accordance with this Agreement, including subcontracting, sublicensing or subleasing to Buyer, or under which the applicable Seller would enforce for the benefit (and at the expense) of Buyer any and all of its rights against a third party (including any Governmental Authority) associated with such VNC Contract, and such Seller Party would promptly pay to Buyer when received all monies received by it under any such VNC Contract. The Parties shall each be responsible for their respective costs in connection with the assignment of VNC Contracts; provided that Buyer shall be solely responsible for the payment of any fee or other charge required to be paid to obtain any required consent from a third party in connection with any such assignment. Once the required consent is obtained, the applicable Seller shall assign the VNC Contract to Buyer for no additional consideration. Nothing in this Section 6.6 shall affect the Buyer' s obligation to indemnify Sellers, as and from Closing, or Assumed Liabilities relating to any VNC Contract. 6.7 Public Statements. None of the Parties or any of their respective Affiliates or Representatives shall issue or cause the publication of any press release or public announcement or otherwise communicate with any news media in respect of this Agreement or any Ancillary Agreement or the transactions contemplated hereby and thereby without the prior written consent of the other Parties (which consent shall not be unreasonably withheld, conditioned or delayed), except as a Party believes in good faith and based on reasonable advice of counsel is required by Law or by applicable rules of any stock exchange or quotation system on which such Party or its Affiliates lists or trades securities (in which case the disclosing Party will use its Commercially Reasonable Efforts to (a) advise the other Parties before making such disclosure and (b) provide such other Parties a reasonable opportunity to review and comment on such release or announcement and consider in good faith any comments with respect thereto). None of the Parties or any of their respective Affiliates or Representatives shall make publicly available this Agreement or any Ancillary Agreement (or any portion thereof) (whether before or after the Closing) without the prior written consent of the other Parties (which consent shall not be unreasonably withheld, conditioned or delayed), except as a Party believes in good faith and based on reasonable advice of counsel is required by Law or by applicable rules of any stock exchange or quotation system on which such Party or its Affiliates lists or trades securities (in which case the disclosing Party will use its Commercially Reasonable Efforts to advise the other Parties before making such disclosure and, upon the request of any other Party, the Parties will work together in good faith to agree and pursue appropriate confidential treatment requests with respect to such Transaction Agreements). 6.8 Consents and Approvals. 6.8.1 Sellers and Buyer and Parent Guarantor shall cooperate with each other to, as promptly as practicable after the Contract Date and in any event prior to the Closing Date, communicate with DOE regarding DO E ' s performance of its obligations under the GEH Standard Spent Fuel Disposal Contract or other policies regarding the acceptance of Special Nuclear Material, including with respect to the highly enriched uranium associated with the Nuclear Test Reactor, and all other HL W, GTCC, and Spent Nuclear Fuel that is subject to this Agreement. 46 4858-8955-7603.vl
Prior to any Party's communication with DOE regarding the topics described in the first sentence of this Section 6.8.1 , such Party shall notify the other Parties of its intent to communicate with DOE (including topics of discussion, time, place, and manner of such communication), obtain the other Parties ' consent to such communication, not to be unreasonably withheld, conditioned, or delayed, and provide the other Parties with the opportunity to participate in such communication. The Parties shall consult on the topics to be discussed in any communication with DOE pursuant to this Section 6.8.1 , and shall consider in good faith the input of the other Parties' into the contents of such communication. 6.8.2 As promptly as practicable after the Contract Date, Buyer and Sellers, as applicable, shall make the filings necessary to obtain Buyer' s Required Regulatory Approvals and Sellers' Required Regulatory Approvals, respectively (which approvals for purposes of this Section 6.8.1 only shall not include the approvals specified in Sections 6.8.3 and 6.8.4). In fulfilling their respective obligations under this Section 6.8.1 , Buyer and Sellers shall each use Commercially Reasonable Efforts to effect or cause to be effected any such filings within thirty (30) days after the Contract Date. Prior to any Party's submission of the applications contemplated by this Section 6.8.1 , the submitting Party shall provide a draft of such application to the other Party for review and comment and the submitting Party shall in good faith consider any revisions reasonably requested by the reviewing Party. Each Party will bear its own costs of the preparation and review of any such filings; provided that any application fees shall be paid by Buyer. 6.8.3 As promptly as practicable after the Contract Date, Buyer and Sellers shall file with NRC an application requesting consent under Section 184 of the Atomic Energy Act, 10 C.F.R. § 50.80, and 10 C.F.R. § 70.36 for the transfer of the NRC Licenses from GEH to Buyer, approval of any conforming license amendments, the NRC License Amendments, or other related approvals. Buyers and Sellers shall request in their initial regulatory filings a condition of the NRC order granting consent to the transfer that the NDF shall be subject to NRC requirements of 10 C.F .R. § 50. 7 5( f) applicable to power reactor licensees. In fulfilling their respective obligations set forth in the immediately preceding sentence, each of Buyer and Sellers shall use its Commercially Reasonable Efforts to affect any such filing within sixty (60) days after the Contract Date. Without limiting the foregoing, the Parties shall include in the application a request that the NRC require that the NRC impose a license condition as part of its consent to the transfer that the investments in the NDF shall com 1 with the NRC's re uirements in 10 C.F.R. 50.82 a 6 and a 8 .
]. Thereafter, Buyer and Sellers shall cooperate with one another to facilitate NRC review of the application by providing the NRC staff with such documents or information that the NRC staff may reasonably request or require any of the Parties to provide or generate.
6.8.4 As promptly as practicable after the Contract Date, Buyer and Sellers shall file with the California Department of Public Health an application requesting consent under the Atomic Energy Act, Section 115000 of the California Health and Safety Code, and California Code of Regulations, Title 17, Division 1, Chapter 5, Subchapter 4, Group 2, Article 5 for the transfer of the California License from GEH to Buyer, and approval of any conforming license amendments or other related approvals. In fulfilling their respective obligations set forth in the 47 4858-8955-7603.vl
] Thereafter, Buyer and Sellers shall cooperate with one another to facilitate State of California Department of Public Health review of the application by providing the State of California Department of Public Health staff with such documents or information that the State of California Department of Public Health staff may reasonably request or require any of the Parties to provide or generate.
6.8.5 Sellers and Buyer and Parent Guarantor shall cooperate with each other to, as promptly as practicable after the Contract Date: (i) prepare and make with any other Governmental Authority having jurisdiction over Sellers, Buyer, Parent Guarantor, the Vallecitos Licensed Facilities, the Vallecitos Nuclear Center or the Assets, all filings required to be made with respect to the transactions contemplated hereby other than as otherwise addressed under this Section 6.8; (ii) use Commercially Reasonable Efforts to obtain the transfer or reissuance to Buyer of all Permits and Environmental Permits; and (iii) use Commercially Reasonable Efforts to obtain all consents, approvals and authorizations of any third parties, in the case of each of the foregoing clauses (i) and (ii), necessary or advisable to consummate the transactions contemplated by this Agreement or required by the terms of any note, bond, mortgage, indenture, deed of trust, license, franchise, permit, concession, contract, lease or other instrument to which Sellers or Buyer or Parent Guarantor is a party or by which any of their respective assets are bound. The Parties shall respond promptly to any requests for additional information made by such Governmental Authorities and use their respective Commercially Reasonable Efforts to participate in any hearin s settlement roceedin s or other roceedin s ordered with res ect to the a lications. Sellers and Buyer shall have the right to review in characterizations of the information relating to the transactions contemplated by this Agreement which appear in any filing made in connection with the transactions contemplated hereby, and the filing Party shall consider in good faith any revisions reasonably requested by the non-filing Party. 6.8.6 Buyer shall have the primary responsibility for securing the transfer, reissuance or procurement of the Permits and Environmental Permits effective as of the Closing Date. Sellers shall cooperate with Buyer's efforts in this regard and assist in any transfer or reissuance of a Permit or Environmental Permit held by Sellers or the procurement of any other Permit or Environmental Permit when so requested by Buyer. In the event that Buyer is unable, despite its Commercially Reasonable Efforts, to obtain a transfer or reissuance of one or more of the Permits or Environmental Permits as of the Closing Date, Buyer may use the applicable Permit or Environmental Permit issued to Sellers in the interim for a period of no more than six (6) months until Buyer is able to obtain a transfer, reissuance or new Permit or Environmental Permit, as applicable; provided that: (i) such use by Buyer is explicitly permitted under applicable Law; (ii) Buyer notifies Sellers prior to the Closing Date; (iii) Buyer continues to make Commercially Reasonable Efforts to obtain a transfer or reissuance of such Permit or Environmental Permit after the Closing Date; and (iv) Buyer indemnifies, defends and holds harmless Sellers against any 48 4858-8955-7603.vl
losses, claims or Liabilities suffered by Sellers in connection with the Permit or Environmental Permit that is not transferred or reissued as of the Closing Date resulting from Buyer's ownership, possession or use of the Assets on and following the Closing Date (and in the case of any claim with respect thereto, the Parties shall follow the procedures described in Section 8.2). In the event that Buyer is unable to obtain necessary issuance or transfer of one or more Permit and/or Environmental Permit within six (6) months of Closing, Buyer and Seller agree to negotiate in good faith regarding potential extension of Buyers right to continue to utilize Permits or Environmental Permits issued to Seller. 6.8.7 Promptly following the submission to the NRC of the application to transfer the NRC Licenses, including the NRC License Amendment request, or such earlier time as Sellers and Buyer agree, Sellers and Buyer shall jointly use Commercially Reasonable Efforts to obtain an IRS private letter ruling from the IRS regarding the transactions contemplated by this Agreement (the "PLR" and the request submitted to the IRS to issue the PLR, the "PLR Request"), to the effect that (i) the NDF will be treated as a "nonqualified nuclear decommissioning fund" for purpose of the election described in Section 1.33 8-6( c)( 5) of the Treasury Regulations; (ii) Sellers' amount realized in connection with the Transaction will include the liabilities related to Total Decommissioning Costs; (iii) to the extent included in the Sellers' amount realized from the Transaction, Sellers' will be entitled to treat their liabilities related to the Total Decommissioning Costs as satisfying economic performance under Section 1.461-4(d)(5) of the Treasury Regulations; and (iv) the Buyer will not recognize immediate taxable income or gain as a result of the receipt of the NDF (including the assets in therein), whether by virtue of making the election described in Section 1.338-6(c)(5) of the Treasury Regulations or otherwise, in connection with the Transaction.
- 6. 8. 7 .1 The Parties agree to cooperate in good faith in connection with the preparation and submission of the PLR Request, and in furtherance thereof, the Parties agree that Sellers and their tax advisors will prepare the first draft of the PLR Request for Buyer and its tax advisors to review and provide comments and revisions. Without limiting the generality of the foregoing, each Party and its tax advisors (i) shall be provided reasonable notice of and permitted to attend any scheduled meetings, discussions and telephone conferences between or among the other Party or its tax advisors and the IRS regarding the PLR Request (and shall, to the extent required by the IRS, provide the other Party and their tax advisors with any IRS Forms 2848 required to allow them to attend such scheduled meetings, discussions and telephone conferences);
(ii) shall promptly notify the other Party after the receipt of any written correspondence or communication from the IRS regarding the PLR Request and provide the other Party with copies of any such correspondence, requests or other documents received from the IRS regarding the PLR Request promptly upon receipt; (iii) shall promptly provide the other Party with a summary in reasonable detail of all oral communications with the IRS regarding the PLR Request; and (iv) shall not submit any written responses or materials to the IRS regarding the PLR Request without the consent of the other Party. 6.8.7.2 Each Party will engage tax advisors as such Par sole discretion and at its sole ex ense in connection with the PLR Re uest. 49 4858-8955-7603.v l
6.8.7.3 Neither Party shall (i) withdraw the PLR Request without the consent of the other Party; (ii) take any action that would cause the Parties to fail to obtain the PLR; or (iii) take any action that would cause the transfer of the NDF to the Buyer to fail to be treated in accordance with Sections 1.461-4(d)(5) or 1.338-6(c)(5) of the Treasury Regulations. 6.8.7.4 The Parties shall cooperate to engage a mutually agreed qualified appraiser to appraise the Assets not included in the NDF, including the Real Pro e with res ect to its value for federal Income Tax u oses as of the Closin
- 6.8.7.5 To the extent that the Parties are unable to obtain the PLR in a form reasonably acceptable to both Parties (it being understood that it shall be unreasonable to reject a form of the PLR that includes rulings, conditions, and representations materially consistent with the requested rulings, provided that no material changes are required to the form of the Transaction as contemplated within this Agreement), the Parties will, acting in good faith, negotiate for a period of sixty (60) days to restructure the transaction in such a tax efficient manner as mutually agreed to by the Parties, subject to the rights of the Parties to terminate this Agreement in accordance with Section 9.1.9 at any time following the expiration of such sixty (60) day period if the Parties are not able to restructure the transaction in a tax efficient manner acceptable to both Parties: provided that such sixty (60) day period shall commence after the actions contemplated in Sections 6.8.7, 6.8.7.1 , 6.8.7.3 , and 6.8.7.4 have been undertaken in good faith by the Parties (provided further that such sixty (60) day period may be commenced earlier upon the mutual agreement of the Parties), and on the date on which a Party notifies the other Party that the PLR that is obtainable is not reasonably acceptable to such Party (in accordance with this Section 6.8.7.5) or that the PLR is, in such Party' s reasonable judgment, not obtainable: provided, further, that neither Party shall be obligated to use anything other than Commercially Reasonable Efforts in connection with any such restructuring and, for the avoidance of doubt, no Party shall have any liability to the other Party for failure to reach mutual agreement as to the acceptability of any such restructuring of the Transaction.
6.8.7.6 Notwithstanding anything to the contrary in this Agreement, including with respect to the matters contemplated by this Section 6.8, neither Buyer nor any of its Affiliates shall be required to agree to, consent to, accept or take any term or condition to, or take any action in connection with, obtaining any of the Required Regulatory Approvals (each a "Regulatory Commitment") if such Regulatory Commitment, individually or together with all other Regulatory Commitments, would reasonably be expected to have a Seller Material Adverse Effect (without giving effect to the enumerated exclusions contained in the definition thereof) (a "Buyer Burdensome Condition"); provided that, the Regulatory Commitments contained in the initial regulatory filings made by Buyer or by Sellers (with the review and consent by Buyer) shall not be deemed, or taken into account in determining, a Buyer Burdensome Condition. 6.9 Brokerage Fees and Commissions. Seller, on the one hand, and Buyer and Parent Guarantor, on the other hand, each represents and warrants to the other that no broker, finder or other Person is entitled to any brokerage fees , commissions or finder's fees in connection with the transactions contemplated hereby by reason of any action taken by the Party making such representation. Seller, on the one hand, and Buyer and Parent Guarantor, on the other hand, will pay to the other or otherwise discharge, and will indemnify and hold the other harmless from and 50 4858-8955-7603.vl
against, any and all claims or liabilities for all brokerage fees, commissions and finder's fees incurred by reason of any action taken by the Indemnifying Party. 6.10 Tax Matters. 6 .10 .1 The Transfer Taxes incurred in connection with this Agreement and the transactions contemplated hereby shall be borne equally by Sellers, on the one hand, and Buyer, on the other hand. Buyer and Sellers will file , to the extent required by applicable Law, all necessary Tax Returns and other documentation with respect to all such Transfer Taxes, and, if required by applicable Law, will each join in the execution of any such Tax Returns or other documentation. The Parties shall comply with all requirements and use Commercially Reasonable Efforts to secure applicable sales tax exemptions for the transactions contemplated by this Agreement. 6.10.2 Except for Transfer Tax returns provided for in Section 6.10.1 , Buyer shall prepare and timely file all Tax Returns required to be filed after the Closing with respect to the Assets and shall duly and timely pay all such Taxes shown to be due on such Tax Returns in accordance with the other provisions in this Section 6.10.2. Buyer's preparation of any such Tax Returns shall be subject to Sellers' approval to the extent that such Tax Returns relate to any period, allocation or other amount for which a Seller is responsible (a "Buyer-Prepared Tax Return"). Buyer shall make such Buyer-Prepared Tax Returns and all schedules and working papers supporting such Buyer-Prepared Tax Returns available for Sellers' review and approval no later than sixty (60) Business Days prior to the due date for filing such Buyer-Prepared Tax Return. Sellers shall provide any comments within thirty (30) Business Days of receiving such draft Buyer-Prepared Tax Return. In the event Buyer and Sellers cannot agree as to the preparation or the reporting of any material item on a Buyer-Prepared Tax Return to be filed b Bu er the dis ute shall be settled in the manner rovided b Section 6.10.5 and the [
] provided, however, that if the Independent Accounting Firm has not made a determination as of the date that such Buyer-Prepared Tax Return is required to be filed, such Buyer-Prepared Tax Return shall be filed in a manner consistent with Sellers' position; provided, further, that with respect to any such Tax Return that is filed prior to a determination by the Independent Accounting Firm, Sellers and Buyer shall take all commercially reasonable steps to amend such Tax Return, if necessary, to reflect any material determination made by the Independent Accounting Firm. In the event that the due date for a Buyer-Prepared Tax Return is fewer than 60 Business Days from the Closing Date, the Parties agree to anticipate in good faith and in an efficient manner the execution of the above-mentioned obligations and will provide one another with the draft of such Tax Return and comments thereto, as applicable, as promptly as practicable after the Closing Date. Not less than five (5) Business Days prior to the due date of any Buyer-Prepared Tax Return, Sellers shall pay to Buyer the amount shown as due on such Tax Return to the extent related to Pre-Closing Tax Periods, including as allocable to Seller pursuant to Section 6.10.3 , and Buyer shall then duly and timely pay all Taxes shown to be due on any such Buyer-Prepared Tax Return.
6.10.3 For all purposes of this Agreement, all real property Taxes, personal property Taxes and similar ad valorem obligations for a Straddle Period shall be apportioned between Sellers and Buyer as of the Closing Date based on the number of days of the portion of such taxable period prior to, and including, the Closing Date, and the number of days of the portion 51 4858-8955-7603.vl
of such taxable period following the Closing Date, respectively. In the case of Asset-Level Taxes attributable to a Straddle Period that are not described in the preceding sentence (such as franchise Taxes, Taxes that are based upon or related to income or receipts, based upon production or occupancy or imposed in connection with any sale or other transfer or assignment of property (real or personal, tangible or intangible)), the amount of any such Asset-Level Taxes attributable to the taxable period prior to, and including, the Closing Date, and the taxable period following the Closing Date shall be determined as if such Straddle Period ended as of the end of the Closing Date. 6.10.4 Each of the Parties shall provide the other with such assistance as may reasonably be requested by any other Party in connection with the preparation of any Tax Return, any audit or other examination by any taxing authority, or any judicial or administrative proceedings relating to Liability for Taxes or effectuating the terms of this Agreement, and each will retain and provide the requesting Party with any records or information which may be relevant to such return, audit or examination, proceedings or determination. Any information obtained pursuant to this Section 6 .10. 4 or otherwise hereunder providing for the sharing of information or review of any Tax Return or other schedule relating to Taxes, shall be kept confidential by the Parties, except to the extent such information is required to be disclosed by Law. 6.10.5 In the event that a dispute arises between Sellers and Buyer as to the preparation or the reporting of any item on a Tax Return to be filed by Buyer or the allocation of such Taxes between Sellers and Buyer, the Parties shall attempt in good faith to resolve such dispute, and any agreed amount shall be paid to the appropriate Party within ten (10) Business Days after the date on which the Parties reach agreement. If a dispute is not resolved within thirty (30) days after a Party having provided the other Party written notice of a dis ute the Parties shall submit the dispute for determination and resolution to [ ] or such other mutually agreeable firm of CP As (which is not Sellers' , Buyer's or Parent Guarantor's independent accountants) of recognized national standing (the "Independent Accounting Firm"), which shall be instructed to determine and report to the Parties in writing, within thirty (30) days after such submission, upon such disputed amount, and such written report shall be final, conclusive and binding on the Parties. The Independent Accounting Firm shall act as an expert and not as an arbitrator and shall make findings only with respect to the remaining disputes so submitted to it (and not by independent review). Notwithstanding anything in this Agreement to the contrary, the fees and expenses of the Independent Accounting Firm in resolving the dispute shall be borne equally by Buyer and Sellers. Any payment required to be made as a result of the resolution of the dispute by the Independent Accounting Firm shall be made within ten (10) days after such resolution. Submission of a dispute to the Independent Accounting Firm shall not relieve any Party from any obligation under this Agreement to timely file a Tax Return or pay a Tax. 6.10.6 The Parties intend that for Income Tax purposes: (i) the sale of the Assets by Sellers to Buyer will be treated as a sale and purchase of the Assets; and (ii) no portion of the Assets (including any assets in the NDF) received by Buyer will be treated in whole or in part as payment by Sellers for services or future services. The Parties agree that should the PLR be received the election described in Section 1.338-6(c)(5) of the Treasury Regulations shall, to the extent required under the PLR (if applicable), be made with respect to the Transaction and the Parties shall cooperate with one another so as to effectuate such election. The Parties further agree 52 4858-8955-7603.vl
that they shall file their respective Tax Returns consistent with (a) the intent of the Parties with respect to this Section 6.10.6 unless otherwise required by a determination as defined in Section 1313 of the Code, and, should the PLR be received by the Parties with respect to the transactions contemplated by this Agreement, also with (b) the PLR received, and (c) the representations made by the Parties to the IRS in connection with the PLR and the PLR Request. Notwithstanding the forgoing, in the event the Parties restructure the transaction pursuant to Section 6.8.7.5 , the tax reporting will be in accordance with such agreed revised structure (and the reporting agreed to with respect to such revisions). 6.10.7 Buyer and Sellers shall use good-faith efforts to jointly agree within ninety (90) days after the Closing Date to an allocation of the Purchase Price and the Liabilities assumed by Buyer as permitted for Income Tax purposes among the Assets that is consistent with Section 1060 of the Code and the regulations promulgated thereunder, including in connection with an election made under Section 1.338-6(c)(5) of the Treasury Regulations (if made), in each case as interpreted by applicable IRS rulings (including the PLR, if applicable). Notwithstanding the foregoing, in the event that Buyer and Sellers cannot agree as to the allocation, each Party shall be entitled to take its own position regarding the allocation in a Tax Return, Tax proceeding or audit. Notwithstanding the foregoing, nothing contained herein shall prevent Buyer or Sellers from reasonably settling any proposed deficiency or adjustment by any Governmental Authority based upon or arising out of the allocation of the Purchase Price pursuant to this Section 6.10.7, and Buyer and Sellers shall not be required to litigate before any court any proposed deficiency or adjustment by any Governmental Authority challenging such allocation. 6.10.8 Tax Contests. 6.10.8.1 Within ten (10) Business Days after the receipt of written notice from a Governmental Authority regarding the commencement of any Tax audit or administrative or judicial proceeding (a "Tax Contest") that relate to any Taxes with respect to which indemnification may be sought from an Indemnifying Party, the recipient of such notice shall provide the Indemnifying Party with written notice thereof; provided that any delay in so notifying shall not relieve any liability or obligations hereunder except to the extent that such other Party has been materially prejudiced thereby, and then only to such extent. 6.10.8.2 Sellers shall direct and control any Tax Contest relating to Asset-Level Taxes for a Pre-Closing Tax Period other than Straddle Periods (a "Seller Tax Contest"); provided, however, that if any portion of the Taxes that are the subject of the Seller Tax Contest constitutes an Assumed Liability, Sellers shall (a) keep Buyer reasonably informed on a timely basis regarding the nature and progress of the Seller Tax Contest and consult in good faith with Buyer regarding the conduct of such Seller Tax Contest (including permitting Buyer to review and comment on any submissions and participate in any meetings with the Governmental Authority); and (b) Sellers shall not settle or compromise any Assumed Liability without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed; provided, further, any expenses related to such foregoing Seller Tax Contests shall be the responsibility of the Sellers. 6.10.8.3 Buyer shall direct and control the Tax Contest relating to Asset-Level Taxes (other than a Seller Tax Contest) (a "Buyer Tax Contest"); provided, however, 53 4858-8955-7603.vl
that if any portion of the Taxes that are the subject of the Buyer Tax Contest constitutes an Excluded Liability, Buyer shall (a) keep Sellers reasonably informed on a timely basis regarding the nature and progress of the Buyer Tax Contest and consult in good faith with Seller regarding the conduct of such Buyer Tax Contest (including permitting Seller to review and comment on any submissions and participate in any meetings with the Governmental Authority); and (b) Buyer shall not settle or compromise any Excluded Liability without the prior written consent of Seller, which consent shall not be unreasonably withheld, conditioned, or delayed: provided, further, any expenses related to such foregoing Buyer Tax Contests shall be the responsibility of the Buyer. 6.10.8.4 Notwithstanding anything in this Agreement to the contrary, any Tax Contest shall be governed by the provisions of this Section 6.10.8. 6.10.9 Subject to Section 6.10.10, from and after the Closing, Sellers shall indemnify and hold harmless the Buyer Indemnitees from and against any and all Losses incurred with respect to or attributable to (a) all Income Taxes of the Sellers and their Affiliates arising out of the transactions contemplated by this Agreement; or (b) Taxes of any Person imposed on Buyer as the transferee or successor, by contract or pursuant to any Law, which Taxes relate to a period (or portion thereof) ending prior to or up through Closing, provided that any specific Loss shall be indemnified no more than once pursuant to this Section 6 .10. 9 or to the extent that such amount is also indemnified under Section 8.1.2 or otherwise. The indemnification provided in this Section 6.10.9 shall survive the Closing until thirty (30) days following the expiration of the applicable statute of limitations plus any extensions or waivers thereof or a determination under Section 1313 of the Code and shall not be subject to any limitations on indemnification contained in other sections of this Agreement. The indemnity pursuant to this Section 6.10.9 shall, other than as described in this Section 6.10.9, be governed by the provisions and procedures of ARTICLE VIII. 6.10.10 Consequences; Reliance on Advisors. No Party makes any representations or warranties regarding the tax treatment or any tax consequences (including as related to tax basis of the Assets) to the other Party of the transactions contemplated by this Agreement or any Ancillary Agreement, and each Party acknowledges that it is relying solely on the tax advice of its own tax advisors in connection with this Agreement and any Ancillary Agreement. 6.11 Real Property Transfer Matters. 6.11.1 Title Review. Sellers have caused First American Title Insurance Company, 333 W. Santa Clara Street, Suite 220, San Jose, CA 95113-1714; (the "Title Company") to deliver to Buyer a current preliminary title report or title commitment for an ALTA owner's policy of title insurance (the "Title Report") issued by the Title Company, describing the state of title of the Real Property, together with copies of all exceptions specified therein. Buyer has obtained a survey of the Real Property prepared by AEI Consultants, a land surveyor duly licensed in the State of California and dated 02/2712023 (the "Survey"). Buyer hereby approves the exceptions contained in the Title Report to the extent reflected in the pro forma attached as Schedule 6.11.1. 54 4858-895 5-7603.vl
6.11.2 Additional Title Matters. If, prior to Closing, Buyer discovers any new exception to title of the Real Property shown on an updated Title Report issued by the Title Company and/or an update to the Survey and delivered to Sellers and Buyer, which was not reflected or disclosed by the Title Report or the Survey and does not constitute a Permitted Encumbrance (a "New Exception"), then Buyer shall have five (5) business days after its receipt of such updated title report or Survey to give Seller a notice objecting to such new matters, and the Closing Date shall be extended to allow for such five (5) business day period. Sellers shall notify Buyer in writing of any New Exception immediately upon Sellers' discovery of the New Exception, and Sellers shall make commercially reasonable efforts in good faith to seek to discharge such New Exception but shall not be obligated to do so. To the extent not cured within the said five ( 5) business day period, if any such New Exception shall constitute a Seller Material Adverse Effect, then Buyer shall have the option to terminate this Agreement, failing which, it shall become a Permitted Encumbrance hereunder, and shall not be an impediment to Closing, notwithstanding any resultant deviation in the Title Policy. 6.11.3 Title Policy. As a condition to Buyer's obligation to purchase the Property, at Closing, the Title Company shall issue to Buyer at Buyer's expense an ALTA owner's policy of title insurance with coverage in an amount determined by Buyer (including based on the appraisal of the Property to be conducted pre-Closing), showing title vested in Buyer, subject only to the Permitted Real Property Encumbrances, in the form attached hereto at Schedule 6.11.1 and with the endorsements shown on Schedule 6.11.1 (the "Title Policy"). In the event the condition precedent set forth in the previous sentence is not satisfied at or prior to Closing, Buyer may, at its option, terminate this Agreement, and the parties shall be released of all further obligations and liability under this Agreement except for those which expressly survive the termination of this Agreement. 6.12 Payment of Real Estate Sale Proceeds. 6.12.1 From and after the Closing Date, if a Disposition Event occurs and at such time the Net Cash Proceeds received by Buyer or its Affiliate exceed the then applicable Base Value, Buyer will pay or cause to be paid to GE (by wire transfer to an account designated by GE to Buyer in advance in writing) within ten 10 Business Da s after recei t of the Net Cash Proceeds from such Disposition Event, [
] . Within five ( 5) Business Days after the occurrence of a Disposition Event, Buyer shall provide GE with its calculation of the Net Cash Proceeds, including sufficient documentation to substantiate such calculation. Sellers shall have the right to review the documentation presented and to request such additional information as may reasonably be necessary to substantiate the calculation of Net Cash Proceeds. To the extent the calculation provided by Buyer to Sellers of Net Cash Proceeds for a Disposition Event includes an estimate of any fees or Taxes pursuant to clause (c) of the definition of Net Cash Proceeds, then following the final determination of the actual amount of such fees and Taxes, Buyer shall provide notice thereof to Sellers and, to the extent the actual fees and Taxes differs from the estimated fees and Taxes by more [ ], then the Parties shall adjust the allocation of the Net Cash Proceeds in connection with such Disposition Event accordingly (with payment to be made promptly to Buyer or Sellers, as applicable).
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6.12.2 Upon Buyer' s payment of the amounts due, if any, to GE in accordance with this Section 6.12 following a Disposition Event, Buyer' s obligations to GE with respect to the Fee Real Property subject to such Disposition Event shall be limited to those obligations of Buyer under the Decommissioning Completion Agreement, the Right of First Negotiation Agreement, and ARTICLE VIII. 6.12.3 Nothing in this Section 6.12 is intended to create a partnership as between any Seller and Buyer for U.S. federal income tax purposes or applicable state and local income tax purposes, and the Parties shall prepare all books, records, and filings for such tax purposes in a manner consistent with such intent and in the event that the IRS were to disagree with the foregoing, each of GE and Buyer will elect to be excluded from the application of Subchapter "K", Chapter 1, Subtitle "A" of the Code to the extent permitted and authorized by Section 761(a) of the Code and regulations promulgated thereunder. 6.13 Decommissioning Funds. 6.13.1 On or before the Closing Date, (a) Sellers shall establish the NDF Trust Agreement for the NDF and (b) Sellers and Buyer shall reasonably cooperate with respect to, and Buyer shall enter into, an Investment Management Agreement with NISA Investment Advisors, LLC, or with another investment management firm mutually agreed between Sellers and Buyer. Sellers shall not materially amend (but may assign as expressly contemplated therein) the NDF Trust Agreement at any time before or after the Closing Date without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed. Buyer shall not materially amend the Investment Management Agreement at any time before the Closing Date. Prior to the Closing Date, Sellers will create and maintain the NDF in accordance with NRC requirements and fund the NDF in the amount of the NDF Minimum Amount. GE will obtain Buyer' s written consent to the pre-Closing assets purchased by the NDF, and except as otherwise agreed by Buyer in writing, all material assets of the NDF at the close of business on the day before the Closing will constitute property other than cash (or other Class I assets as defined by Treas. Reg. section 1.338-6(b )(1)). Sellers shall deliver to Buyer prior to the Closing a brokerage or other third-party custodian' s statement of assets of the NDF as of a recent date prior to the Closing, which were purchased pursuant to Buyer's direction pursuant to this Section 6.13.1. 6.13.2 Sellers shall cause the Trustee of the NDF to pay final expenses for trustee and investment management fees and other administrative expenses of the NDF relating to transactions on or prior to the Closing Date to the extent practicable. Sellers shall cause the Trustee of the NDF to notify Buyer in writing of the estimated amount of such NDF expenses due on or after the Closing Date. Buyer shall ensure that the NDF Trust Agreement allows for the payment of such expenses and shall direct the Trustee of the NDF to pay the expenses identified in the preceding sentence to the extent not paid before the Closing Date. 6.13.3 On the Closing Date, Sellers shall cause the NDF, which shall contain assets in an amount that is no less than the NDF Minimum Amount, to be transferred to the Buyer, including by assigning the NDF Trust Agreement effective as of the Closing Date to Buyer. 6.14 Pre-Closing Decommissioning Activities. As the owner and operator of the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center, Sellers intend to undertake 56 4858-895 5-7603.vl
certain activities during the Pre-Closing Period, including those set forth on Schedule 6.14 (the "Pre-Closing Decommissioning Activities"). Notwithstanding anything to the contrary in the foregoing, if Buyer requests that Sellers enter into an agreement or issue a purchase order for any reason relating to Buyer's planned Decommissioning of the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center, and Sellers agree to do so, the activities related to entering into such agreement or issuing such purchase order and performing its obligations thereunder shall be deemed added to the Pre-Closing Decommissioning Activities set forth in Schedule 6.14. 6.15 Cooperation Relating to Nuclear Insurance Policies and Price-Anderson Act. Until the Closing, Sellers will maintain, or cause to be maintained, in effect (i) insurance in amounts and against such risks and losses as is customary in the commercial nuclear industry; and (ii) not less than the level of nuclear property damage and nuclear liability insurance for the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center as in effect on the Contract Date or as otherwise required by the NRC. Sellers shall cooperate with Buyer's efforts to obtain insurance, including insurance required under the Price-Anderson Act or other Nuclear Laws with respect to the Assets. In addition, subject to Buyer's written commitment to satisfy its indemnification obligations under Section 8 .1.1 , Sellers agrees to use Commercially Reasonable Efforts to assist Buyer in making any claims against pre-Closing ANI insurance 2olicies or other insurance olicies to meet the re uirements of 10 C.F.R. 50.54 w . 6.16 NRC Commitments. Sellers (until the Closing) and Buyer (after the Closing) shall maintain and use the Vallecitos Licensed Facilities and the Assets in accordance with the NRC Commitments, the NRC Licenses, applicable NRC regulations and policies and with applicable Laws, including Nuclear Laws. 6.17 Decommissioning. Buyer shall commit to the NRC, applicable California Authorities (ifrequired) and other applicable Governmental Authorities, that Buyer will complete, at its expense, the Decommissioning of the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center, and that it will complete all Decommissioning activities in accordance with all Nuclear Laws and Environmental Laws, including applicable requirements of the Atomic Energy Act and the NRC 's rules, regulations, orders and guidance thereunder. Buyer shall take all steps necessary to satisfy any requirements imposed by the NRC regarding decommissioning funds, in a manner sufficient to obtain NRC approval of the transfer of the NRC Licenses from Seller to Buyer. In the event that the NRC, any California Authority or other Governmental Authority requires Buyer to provide Decommissioning funding assurance in an amount in excess of the Decommissioning funds Buyer has in place at such time, Parent Guarantor (or such other entity as shall be acceptable to the NRC) shall post a guaranty or other financial assurances or take such other action as is sufficient to satisfy such additional assurance requirement in such form as required by such Governmental Authority. 6.18 Insurance Policies. 6 .18 .1 In addition to any insurance that may be required under the Real Property Agreements or the VNC Contracts, on and after the Closing Date, Buyer shall have and maintain 57 4858-8955-7603.vl
in effect policies of liability and property insurance with respect to the ownership, possession, use and maintenance of the Vallecitos Licensed Facilities which shall afford protection against the insurable hazards and risks with respect to which nuclear facilities of similar size and type to the Vallecitos Licensed Facilities customarily maintain insurance, and which meets the requirements of the NRC Licenses. Such coverage shall include nuclear liability insurance from ANI in such form and in such amount as will meet the financial protection requirements of the Atomic Energy Act as provided in the NRC Licenses, and an agreement of indemnification as contemplated by Section 170 of the Atomic Energy Act. In the event that the nuclear liability protection system contemplated by Section 170 of the Atomic Energy Act is repealed or changed, Buyer shall have and maintain in effect, alternate protection against nuclear liability in accordance with all applicable Laws. 6.18.2 Notwithstanding Buyer' s assumption of the nuclear liability insurance policies from ANI, GEH shall have the right to receive and retain the amount of returned premiums or credits issued under ANI's Industry Credit Rating Plan with respect to such ANI policy that relate to any period prior to the Closing Date (the "Pre-Closing Date ICRP Payments"). Accordingly, Buyer shall take all reasonable actions necessary to cause ANI to issue any Pre-Closing Date ICRP Payments directly to GEH, subject to GEH's reasonable cooperation. In the event that Pre-Closing Date ICRP Payments are made or issued directly to Buyer, Buyer shall notify GEH of its receipt of the same and shall pay GEH an amount equal to the Pre Closing Date ICRP Payment received by Buyer via ACH, wire or certified check within ten (10) Business Days of Buyer's receipt of such Pre-Closing Date ICRP Payment. Buyer shall have the right to receive and retain any returned premiums or credits issued under ANI' s Industry Credit Rating Plan with respect to the ANI Policy that relate to any period that begins on or after the Closing Date. 6.18.3 On and after the Closing, the Vallecitos Licensed Facilities and the Vallecitos Nuclear Center shall cease to be in any manner insured by, entitled to any benefits or coverage under or entitled to seek benefits or coverage from or under any Insurance Policies other than (i) any Insurance Policy issued exclusively in the name and for the benefit of the Vallecitos Licensed Facilities or the Vallecitos Nuclear Center except for any such Insurance Policy which forms a part of a fronted, or equivalent, insurance program for which GE or GEH retains funding responsibility, (ii) with respect to any incident reported under the relevant Insurance Policies prior to the Closing Date; or (iii) with respect to any incident reported under the Available Insurance Policies within a one-year period concluding on the first anniversary of the Closing Date, but solely for such incidents that took place prior to the Closing Date, in each case under clauses (i) through (iii) above subject to the terms and conditions of the relevant Insurance Policies and this Agreement, except to the extent otherwise mandated by Law. For the avoidance of doubt, there shall be no benefits or coverage under Section 6.18.3(iii) for incidents that take place after the Closing Date even if they are related to other similar incidents that took place prior to the Closing Date. "Available Insurance Policies" means those Insurance Policies listed in the Schedule 6 .18 .3. Buyer shall procure all contractual and statutorily obligated insurance for the Vallecitos Nuclear Center and Vallecitos Licensed Facilities at Closing. 6.18.4 The rights of the Buyer under subparagraph (ii) of Section 6.18.3 are subject to and conditioned upon the following : 58 4858-895 5-7603.vl
6.18.4.1 Buyer shall be solely responsible for notifications and updates to the applicable insurance companies and compliance with all policy terms and conditions for pursuit and collection of such claims. Buyer shall not, without the written consent of GE and GEH, amend, modify, waive or release an ri hts of Sellers or other insureds under an such Insurance Policies and ro rams. 6 .18 .4 .2 With respect to coverage claims or requests for benefits asserted by Buyer under the Insurance Policies, GE shall have the right but not the duty to monitor and/or associate with such claims. Buyer shall be liable for any fees , costs and expenses incurred by GE directly or indirectly through GE's insurance subsidiaries or Affiliates relating to any unsuccessful coverage claims by Buyer. Buyer shall not assign any Available Insurance Policies or any rights or claims under the Available Insurance Policies. 6.18.4.3 For avoidance of doubt, Sellers shall have no responsibilities or obligations with respect to any matters under Section 6.18.3(i) above. 6.18.5 Notwithstanding anything contained in this Agreement, (i) nothing in this Agreement shall limit, waive or abrogate in any manner any rights of GE or GEH to insurance coverage for any matter, whether relating to the rights of the Vallecitos Nuclear Center or Vallecitos Licensed Facilities or otherwise, and (ii) GE and GEH shall retain the exclusive right to control the Insurance Policies, including the right to exhaust, settle, release, commute, buy-back or otherwise resolve disputes with respect to any of their Insurance Policies and to amend, modify or waive any rights under any such Insurance Policies, notwithstanding whether any such Insurance Policies apply to any liabilities or losses as to which Buyer has made, or could in the future , make a claim for coverage; and (iii) Buyer shall cooperate with GE and GEH with respect to coverage claims and requests for benefits and sharing such information as is reasonably necessary to permit GE or GEH to manage and conduct its insurance matters as they deem appropriate. 6.18.6 Nothing in this Section 6.18 shall limit, modify or in any way affect the rights and obligations of the Parties under ARTICLE VIII; provided, however, that any insurance proceeds actually collected with respect to a particular Loss shall be taken into account under and to the extent required by Section 8.2.5 . No payments due under to this Section 6.18 shall affect, be affected by, or be subject to set off against, any adjustment to the Purchase Price. Whenever this Section 6 .18 requires Buyer to take any action after the Closing Date, such requirement shall be deemed to constitute an undertaking on the part of Buyer to take such action or to cause Buyer to take such action. 6 .19 California Governmental Authorities. If requested by any state, regional or local Governmental Authority of the State of California ("California Authorities"), Buyer and Parent Guarantor will appear before said California Authorities and present testimony, respond to interrogatories and requests for discovery, or otherwise provide information requested by California Authorities regarding the management, financial condition and financial resources, corporate structure, ownership and control, engineering systems, designs, techniques, processes and know-how, costs of operation and Decommissioning work, business relationships with 59 4858-8955-7603.vl
Affiliates, contractual terms, projections and other matters of interest identified by California Authorities. Buyer will commit to any record-keeping and record-retention requests that California Authorities may impose. Sellers and Buyer shall cooperate in responding or dealing with California Authorities on matters that relate to the performance of this Agreement or the transactions contemplated hereby. 6.20 Rights to GE Names and GE Marks. 6.20.1 Except as otherwise provided in this Section 6.20, Buyer and its Affiliates shall cease and discontinue all uses of the GE Names and GE Marks immediately upon the Closing. Buyer, for itself and its Affiliates, agrees that the rights of Buyer or its Affiliates to the GEN ames and GE Marks pursuant to the terms of any trademark agreements or otherwise shall terminate on the Closing Date and be replaced by such rights as are provided under this Section 6.20. 6.20.2 Buyer and its Affiliates shall (i) except as permitted under this Section 6.20, (A) immediately upon the Closing cease all use of any of the GE Names and GE Marks on or in connection with all stationery, business cards, purchase orders, lease agreements, warranties, indemnifications, invoices and other similar correspondence and other documents of a contractual nature and (B) complete the removal of the GE Names and GE Marks from all products, services and technical information promotional brochures of related to Vallecitos Nuclear Center prior to the six-month anniversary of the Closing Date and (ii) with respect to any Assets bearing any GE Names and GE Marks, use their Commercially Reasonable Efforts to re-label such assets or remove such GE Names and GE Marks from such assets as promptly as practicable, and in any event prior to the six-month anniversary of the Closing Date. 6.20.3 Buyer, for itself and its Affiliates, agrees that after the Closing Date, Buyer and its Affiliates (i) will not expressly, or by implication, do business as or represent themselves as being affiliated with or an agent of either Seller, Hitachi Ltd., or any of their respective Affiliates and (ii) with respect to Assets after the Closing, will represent that such assets are those of Buyer and its Affiliates and not those of Sellers or their Affiliates. Buyer, for itself and its Affiliates, acknowledges and agrees that, except to the extent expressly provided in this Section 6.20, neither Buyer nor any of its Affiliates shall have any rights in any of the GE Names and GE Marks and neither Buyer nor any of its Affiliates shall contest the ownership or validity of any rights of any Seller or any of its Affiliates in or to any of the GE Names and GE Marks. 6 .21 Notification of Significant Changes. During the Pre-Closing Period, Buyer, on the one hand, and Sellers, on the other hand, shall each promptly, but in any event within ten (10) days, notify the other in writing of the occurrence or discovery of the occurrence of a Seller Material Adverse Effect or a Buyer Material Adverse Effect, respectively. 6.22 Data Room. At least five (5) Business Days prior to the Closing Date, Sellers shall deliver to Buyer one (1) copy of the Data Room contained on a USB device or one or more DVDs. 6.23 Performance Deed of Trust. From time to time following the Closing, within ten (10) days following Buyer's delivery of a notice to Sellers that the Release Condition with respect to any portion of the Property (such applicable portion, the "Released Property") has been satisfied, Sellers shall, at Sellers' sole expense, cause such Released Property to be released from the Deed 60 4858-895 5-7603.vl
of Trust and shall cause the recordation with the Alameda County Recorder of any documentation reasonably requested by Buyer to evidence the same. For purposes hereof the "Release Condition" shall be satisfied with respect to any Released Property upon the later to occur of: (a) the approval of all relevant Governmental Authorities having jurisdiction over NRC Licenses and California License to release a portion of the Real Property comprising the Vallecitos Licensed Facilities upon completion of Decommissioning of such Released Property and (b) satisfaction of any requirements of the Subdivision Map Act to allow the property remaining after the Released Parcel to be encumbered separately from such Released Property Buyer's completion of subdivision of such Released Property. ARTICLE VII CONDITIONS 7 .1 Conditions to Obligations of Buyer. The obligations of Buyer to purchase the Assets and to consummate the other transactions contemplated by this Agreement shall be subject to the fulfillment at or prior to the Closing Date (or the waiver in writing by Buyer in its sole discretion) of the following conditions: 7 .1.1 No preliminary or permanent injunction or other order or decree by any Governmental Authority which restrains or prevents the consummation of the transactions contemplated by this Agreement or the Ancillary Agreements shall have been issued and remain in effect and no statute, rule or regulation shall have been enacted by any Governmental Authority which prohibits the consummation of the transactions contemplated by this Agreement or the Ancillary Agreements; 7.1.2 All Sellers' Required Regulatory Approvals shall have been received and such approvals shall be in full force and effect; 7.1.3 No Required Regulatory Approval shall require or contain any undertaking, term, condition, liability, obligation, commitment or sanction that, individually or in the aggregate, constitutes or imposes a Buyer Burdensome Condition; 7.1.4 Sellers shall have performed and complied in all material respects with the covenants and agreements contained in this Agreement which are required to be performed and complied with by Sellers on or prior to the Closing Date; 7 .1. 5 The representations and warranties of each Seller set forth in this Agreement shall be true and correct as of the Closing Date, or in the case of representations and warranties that are made as of a specified date, such representations and warranties shall be true and correct as of such specified date, except where the failure to be so true and correct (without giving effect to any limitation or qualification as to "materiality" (including the word "material") or "Material Adverse Effect" set forth therein) would not, individually or in the aggregate, reasonably be expected to have a Seller Material Adverse Effect; 7 .1. 6 Since the Contract Date, no Seller Material Adverse Effect shall have occurred and be continuing; 61 4858-8955-7603.v l
7 .1. 7 Buyer shall have received a certificate (or certificates) signed by an authorized signatory of each Seller, dated the Closing Date, stating that the conditions set forth in Sections 7 .1.4, 7 .1. 5, and 7.1. 6 as to each Seller have been satisfied; 7.1. 8 Each Seller shall have delivered, or caused to be delivered, to Buyer at the Closing, each Seller's Closing deliveries described in Section 3.3; 7.1. 9 Sellers shall have executed all of the Ancillary Agreements to which they are parties; 7.1.10 [ ], the Title Company shall have committed to issue the Title Policy; 7 .1.11 GEH shall have submitted the license amendment request described in clause (iv) of Section 6.1.2, and the NRC shall either (a) have granted such request, or (b) have not granted s u e ~ but (i) shall not have rejected such license amendment request and (ii) more than [ - ] shall have passed from the date of submittal; and 7.1.12 Sellers shall have funded the NDF with the NDF Minimum Amount. 7.2 Conditions to Obligations of Sellers. The obligations of Sellers to sell the Assets and to consummate the other transactions contemplated by this Agreement shall be subject to the fulfillment at or prior to the Closing Date (or the waiver in writing by Sellers in their sole discretion) of the following conditions: 7.2.1 No preliminary or permanent injunction or other order or decree by any Governmental Authority which restrains or prevents the consummation of the transactions contemplated by this Agreement or the Ancillary Agreements shall have been issued and remain in effect and no statute, rule or regulation shall have been enacted by any Governmental Authority which prohibits the consummation of the transactions contemplated by this Agreement or the Ancillary Agreements; 7.2.2 All Buyer Required Regulatory Approvals shall have been received and such approvals shall be in full force and effect and such approvals shall have become Final orders or the Parties shall have agreed to allow Buyer to rely on one or more Permits or Environmental Permits issued to Seller as provided in Section 6.8.7; 7.2.3 Buyer shall have performed and complied in all material respects with the covenants contained in this Agreement which are required to be performed and complied with by Buyer on or prior to the Closing Date; 7.2.4 The representations and warranties of Buyer set forth in this Agreement shall be true and correct as of the Closing Date, or in the case of representations and warranties that are made as of a specified date, such representations and warranties shall be true and correct as of such specified date, except where the failure to be so true and correct (without giving effect to any limitation or qualification as to "materiality" (including the word "material") or "Material 62 4858-8955-7603.vl
Adverse Effect" set forth therein) would not, individually or in the aggregate, reasonably be expected to have a Buyer Material Adverse Effect; 7.2.5 Since the Contract Date, no Buyer Material Adverse Effect shall have occurred and be continuing; 7.2.6 Sellers shall have received a certificate signed by an authorized officer of Buyer, dated the Closing Date, stating that the conditions set forth in Sections 7.2.3 , 7.2.4, and 7.2.5 have been satisfied; 7.2.7 Buyer and Parent Guarantor shall have executed all of the Ancillary Agreements to which they are parties; 7.2.8 Buyer shall have delivered, or caused to be delivered, to Sellers at the Closing, Buyer' s and Parent Guarantor' s Closing deliveries described in Section 3.4; 7.2.9 GEH shall have submitted the license amendment request described in clause (iv) of Section 6.1.2, and the NRC shall either (a) have granted such request, or (b) have not granted s u e ~ but (i) shall not have rejected such license amendment request and (ii) more than [ - ] shall have passed from the date of submittal; and 7.2.10 The required consents listed on Schedule 7.2.10 shall have been received. 7.3 Frustrating of Closing Conditions. Neither Sellers nor Buyer may rely on the failure of any condition set forth in this ARTICLE VII to be satisfied if such failure was caused by such Party's failure to comply with its obligations to cause the Closing to occur, including as required by the terms of Section 6.8. ARTICLE VIII INDEMNIFICATION 8.1 Indemnification. 8.1.1 Subject to the other provisions of this ARTICLE VIII, from and after the Closing, Buyer, shall indemnify, reimburse, defend upon request, and hold harmless each of the Seller Parties (each, a "Seller Indemnitee") against any and all Indemnifiable Losses, asserted a ainst or suffered b an Seller Indemnitee relatin to, resultin from or arisin out of: 63 4858-8955-7603.vl
8.1.2 Sub*ect to the other rovisions of this ARTICLE VIII from and after the Sellers shall the Buyer Parties (each a "Bu er Indemnitee") a ainst an and all Indemnifiable Losses asserted 8.1.3 The expiration or termination of any representation or warranty shall not affect the Parties' obligations under this Section 8.1 if the Indemnitee provided the Person required to provide indemnification under this Agreement (the "Indemnifying Party") in good faith with written notice of the claim or event for which indemnification is sought in accordance with this Agreement prior to such expiration, termination or extinguishment. 8.1.4 Following the Closing Date, except to the extent otherwise provided in ARTICLE IX, or Section 6.10 and except for claims resulting or arising out of or based upon Fraud or willful misconduct, the rights and remedies of Sellers and Buyer under this ARTICLE VIII are exclusive and in lieu of any and all other rights and remedies which Sellers and Buyer may have under this Agreement or otherwise includin Environmental Laws and Nuclear Laws for relief, with res ect to 64 4858-8955-7603.v l
8.2 Defense of Claims. 8.2.1 If any Indemnitee receives notice of the assertion of any claim or of the commencement of any claim, action, or proceeding made or brought by any Person who is not a Party or an Affiliate of a Party (a "Third-Party Claim") with respect to which indemnification is to be sought from an Indemnifying Party, the Indemnitee shall give such Indemnifying Party reasonably prompt written notice thereof, but in any event such notice shall not be given later than twenty (20) calendar days after the Indemnitee's receipt of notice of such Third-Party Claim, except as otherwise provided by Section 8.2.6. Such notice shall describe the nature of the Third-Party Claim in reasonable detail and shall indicate the estimated amount, if practicable, of the Indernnifiable Loss that has been or may be sustained by the Indemnitee. The Indemnifying Party will have the right, at its election, to direct the defense of any Third-Party Claim at such Indemnifying Party's expense and by such Indemnifying Party' s own counsel. The Indemnitee shall cooperate in good faith in such defense at such Indemnitee's own expense. If the Indemnifying Party does not elect to defend any such Third-Party Claim, the Indemnifying Party shall cooperate in good faith in the Indemnitee's defense and may reasonably participate in the defense of the claim, all at such Indemnifying Party's expense. 8.2.2 If, within twenty (20) days after an Indemnitee provides written notice to the Indemnifying Party of any Third-Party Claim, the Indemnitee receives written notice from the Indemnifying Party that such Indemnifying Party will assume the defense of such Third-Party Claim as provided in Section 8 .2 .1 , the Indemnifying Party will not be liable for any legal expenses subsequently incurred by the Indemnitee in connection with the defense thereof. 8.2.3 Without the prior written consent of the Indemnitee, which consent shall not be unreasonably withheld, conditioned or delayed, the Indemnifying Party shall not enter into any settlement of any Third-Party Claim which would lead to Liability or create any financial or other obligation on the part of the Indemnitee for which the Indemnitee is not entitled to indemnification hereunder. If a firm offer is made to settle a Third-Party Claim without leading to Liability or the creation of a financial or other obligation on the part of the Indemnitee for which the Indemnitee is not entitled to indemnification hereunder and the Indemnifying Party desires to accept and agree to such offer, the Indemnifying Party shall give written notice to the Indemnitee to that effect. If the Indemnitee fails to consent to such firm offer within twenty (20) days after its receipt of such notice, the Indemnifying Party shall be relieved of its obligations to defend such Third-Party Claim and the Indemnitee may contest or defend such Third-Party Claim. In such event, the maximum Liability of the Indemnifying Party as to such Third-Party Claim will be the 65 4858-895 5-7603.vl
amount of such settlement offer plus reasonable costs and expenses paid or incurred by Indemnitee up to the date of said notice. 8.2.4 Any claim by an Indemnitee on account of an Indemnifiable Loss which does not result from a Third-Party Claim (a "Direct Claim") shall be asserted by giving the Indemnifying Party reasonably prompt written notice thereof, stating the nature of such claim in reasonable detail and indicating the estimated amount, if practicable, but in any event such notice shall not be given later than thirty (30) days after the Indemnitee becomes aware of such Direct Claim, and the Indemnifying Party shall have a period of thirty (30) days within which to respond to such Direct Claim. If the Indemnifying Party does not respond within such thirty (30) day period, the Indemnifying Party shall be deemed to have accepted such claim. If the Indemnifying Party rejects such claim, the Indemnitee will be free to seek enforcement of its right to indemnification under this Agreement. 8.2.5 Each Indemnitee shall be obligated in connection with any claim on account of an Indemnifiable Loss to, and shall cause its Affiliates and Representatives to, take all reasonable actions to avoid, minimize and mitigate Indemnifiable Losses, including by diligently pursuing and, as applicable, litigating applicable claims against the DOE and other third parties. The amount of any Indemnifiable Loss shall be reduced to the extent that the Indemnitee receives (i) indemnification from any third party or other cash receipts or sources of reimbursement in respect of such Indemnifiable Loss or any insurance proceeds with respect to an Indemnifiable Loss or (ii) any Tax Benefit realized by the Buyer Indemnitee or Seller Indemnitee in respect of such Indemnifiable Losses. If the amount of any Indemnifiable Loss, at any time subsequent to the making of an indemnity payment in respect thereof, is reduced by (1) recovery, settlement or otherwise under or pursuant to any insurance coverage, or pursuant to any claim, recovery, settlement or payment by, from or against any other entity, or (2) the recognition of a Tax Benefit, the amount of such reduction, less any costs, expenses or premiums incurred in connection therewith (together with interest thereon from the date of payment thereof to the date or repayment at the "prime rate" as published in The Wall Street Journal) shall promptly be repaid by the Indemnitee to the Indemnifying Party. 8.2.6 A failure to give timely notice as provided in this Section 8.2 shall not affect the rights or obligations of any Party hereunder except if, and only to the extent that, as a result of such failure, the Party which was entitled to receive such notice was actually prejudiced as a result of such failure. ARTICLE IX TERMINATION 9.1 Termination. This Agreement may be terminated as follows : 9 .1.1 At any time prior to the Closing Date by mutual written consent of Sellers and Buyer; 9 .1.2 By Sellers or Buyer, if (i) any federal or state court of competent jurisdiction shall have issued an order, judgment or decree permanently restraining, enjoining or otherwise prohibiting the Closing, and such order, judgment or decree shall have become final and 66 4858-895 5-7603.vl
non-appealable; or (ii) any Law shall have been enacted or issued by any Governmental Authority which, directly or indirectly, prohibits the consummation of the Closing; 9.1.3 By Sellers or Buyer if any Buyer' s Required Regulatory Approval or Sellers' Required Regulatory Approval has been denied in a non-appealable order; 9.1.4 By Sellers or Buyer if Closing does not occur within thirty (30) days after all of the conditions to Closing set forth in ARTICLE VII have been received or waived; provided, however, that the right to terminate this Agreement under this Section 9 .1. 4 shall not be available to any Party whose failure to comply with any provision of this Agreement has been the primary cause of, or resulted in, the failure to meet any condition to Closing within such time period; 9.1.5 By Sellers or Buyer if Closing does not occur within two (2) years following the Contract Date (the "Termination Date"), provided, however, that if all of the conditions to Closing set forth in ARTICLE VII have been satisfied or waived (or by their nature are to be satisfied at the Closing) except, to the extent applicable, for the conditions set forth in Sections 7.1.2, 7.1.3 , and 7.2.2, then either Sellers, on the one hand, or Buyer, on the other hand, may cause the Termination Date to be extended up to two times in the aggregate, each time by a period of three months, by delivering written notice to Buyer (in the case of an extension by Sellers) or Sellers (in the case of an extension by Buyers) within ten (10) days prior to the then-effective Termination Date, and if so extended, such extended date shall be the Termination Date, provided further, however, that the right to terminate this Agreement under this Section 9.1.5 shall not be available to any Party whose failure to comply with any provision of this Agreement has been the primary cause of, or resulted in, the failure to meet any condition to Closing within such time period; 9.1.6 By Buyer if (1) there has been a material violation or breach by Sellers of any covenant, representation or warranty contained in this Agreement, and such violation or breach (i) would give rise to the failure of a condition set forth in Section 7 .1 , (ii) is not cured by the earlier of (a) the Termination Date, and (b) sixty (60) days after receipt by Sellers of written notice specifying particularly such violation or breach (provided that in the event Sellers are attempting to cure the violation or breach in good faith, then Buyer may not terminate pursuant to this provision unless the violation or breach is not cured within thirty (30) days after all other conditions precedent to Closing set forth in ARTICLE VII (other than those which by their nature are to be satisfied on the Closing Date) have been either satisfied or waived); and (iii) such violation or breach has not been waived by Buyer or (2) a Seller Material Adverse Effect has occurred and, if capable of cure, has not been cured by the earlier of (a) the Termination Date and (b) ninety (90) days after the occurrence of the events giving rise to such Seller Material Adverse Effect; and 9 .1. 7 By Sellers if (1) there has been a material violation or breach by Buyer of any covenant, representation or warranty contained in this Agreement, and such violation or breach (i) would give rise to the failure of a condition set forth in Section 7.2, (ii) is not cured by the earlier of (a) the Termination Date and (b) sixty (60) days after receipt by Buyer or Parent Guarantor of written notice specifying particularly such violation or breach (provided that in the event Buyer or Parent Guarantor, as the case may be, is attempting to cure the violation or breach in good faith, then Sellers may not terminate pursuant to this provision unless the violation or breach is not cured within thirty (30) days after all other conditions precedent to Closing set forth 67 4858-895 5-7603.vl
in ARTICLE VII have been either satisfied or waived); and (iii) such violation or breach has not been waived by Sellers or (2) a Buyer Material Adverse Effect has occurred and, if capable of cure, has not been cured by the earlier of (a) the Termination Date and (b) ninety (90) days after the occurrence of the events giving rise to such Buyer Material Adverse Effect; 9.1.8 By Sellers if (i) prior to the Closing Date the financial condition of the Parent Guarantor deteriorates such as that it would constitute a Decommissioning Default (as defined in the form of Decommissioning Completion Agreement attached hereto as Exhibit C); and (ii) alternative financial assurances acceptable to Sellers in their sole discretion are not provided by the earlier of (a) the Termination Date and (b) sixty (60) days after receipt by Buyer of written notice specifying such deterioration; and 9.1.9 By Sellers or Buyer if an event described in Section 6.8.7.5 has occurred and during the sixty (60) day period described in Section 6.8.7.5 , the Parties are not able to restructure the transaction in a tax efficient manner that satisfies the requirements of Section 6.8.7.5. 9 .2 Effect of Termination. In the event of a termination of this Agreement by Sellers or Buyer pursuant to Section 9 .1 , this Agreement shall immediately become void except for obligations and rights in Section 6.4, Section 6.7, this Section 9.2, and ARTICLE X, the Confidentiality Agreement and all other obligations of the Parties which are expressly intended to be performed after the termination of this Agreement, shall survive any termination of this Agreement and neither Party shall thereafter have any further liability hereunder to the other Parties; provided, however, that nothing in this Agreement shall relieve a Party from liability for any willful breach of or willful failure to perform under this Agreement. A terminating Party shall provide written notice of termination to the other Parties specifying with particularity the basis for such termination and including supporting documentation, as applicable. If more than one provision in Section 9 .1 is available to a terminating Party in connection with a termination, a terminating Party may rely on any or all available provisions in Section 9 .1. ARTICLEX MISCELLANEOUS PROVISIONS 10.1 Amendment and Modification. Subject to applicable law, this Agreement may be amended, modified or supplemented only by written agreement of Sellers and Buyer. 10.2 Waiver of Compliance; Consents. Any Party may (a) extend the time for the performance of any of the obligations or other acts of another Party, (b) waive any inaccuracies in the representations and warranties contained in this Agreement or in any document delivered pursuant to this Agreement or (c) waive compliance with any of the covenants or agreements or satisfaction of conditions contained in this Agreement. Any such extension or waiver shall be valid only if set forth in an instrument in writing signed by the Party to be bound thereby. The waiver by a Party of a breach of any term or provision of the Agreement or any condition in this Agreement shall not be construed as a waiver of any subsequent breach or waiver of any similar term, provision or condition of this Agreement. 68 4858-8955-7603.vl
10 .3 Survival of Representations, Warranties, Covenants and Obligations. 10 .4 Notices. All notices, requests, claims, demands and other communications hereunder shall be in writing and shall be given or made (and shall be deemed to have been duly given or made upon receipt) by delivery in-person, by overnight courier service or electronic mail with receipt confirmed (followed by delivery of an original via overnight courier service) or by registered or certified mail (postage prepaid, return receipt requested) to the respective parties at the following addresses and email addresses (or at such other address or email address for a party as shall be specified in a notice given in accordance with this Section 10.4): If to Sellers, to: General Electric Company One Financial Center, Suite 3700 Boston, MA 02111 Senior Counsel, Mergers & Acquisitions E-Mail: ma.transactions@ge.com and 69 4858-8955-7603.vl
GE-Hitachi Nuclear Energy Americas LLC 3901 Castle Hayne Road P.O. Box 780 Wilmington, NC 28402 General Counsel E-Mail: angela.thornhill@ge.com with copies to: Timothy Matthews and Michael Espinoza Morgan, Lewis & Bockius LLP 1111 Pennsylvania Avenue, NW Washington, DC 20004 E-Mail: timothy.matthews@morganlewis.com E-Mail: michael.espinoza@morganlewis.com and Masahito Yoshimura, General Manager Global Nuclear Business Development and Management Center Nuclear Systems Division, Nuclear Energy Business Unit Hitachi, Ltd. Akihabara Daibiru Building 18-13, Soto-Kanda 1-chome Chiyoda-ku, Tokyo 101-8608, Japan E-mail: masahito .yoshimura.fa@hitachi.com and Alexander Lourie Barack F errazzano Kirschbaum & N agelberg LLP 200 West Madison Street, Suite 3900 Chicago, Illinois 60606 E-mail: alexander.lourie@bfkn.com Ifto Buyer, to: NorthStar D&D, LLC c/o NorthStar Group Services, Inc. 370 7th Ave. , Suite 1803 New York, NY 10001 Attn: Scott E. State, CEO Email: sstate@northstar.com and 70 4858-895 5-7603.vl
NorthStar Group Services, Inc. 370 7th Ave. , Suite 1803 New York, NY 10001 Attn: Gregory G. DiCarlo, Vice President & General Counsel Email: gdicarlo@northstar.com with copies to : Pillsbury Winthrop Shaw Pittman LLP 1200 Seventeenth Street NW Washington, DC 20036-3006 Attn: Michael G. Lepre Email: michael.lepre@pillsburylaw.com 10.5 No Third Party Beneficiaries. No provision of this Agreement is intended to confer any right, interests, obligations or remedies hereunder upon any Person except the Parties. 10.6 Assignment. This Agreement and all of the provisions hereof shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns. A Party shall not, including by operation of law, assign this Agreement or any of their respective rights, interests or obligations hereunder to any other Person, without the prior written consent of the other Parties. Any assignment in contravention of the foregoing sentence shall be null and void and without legal effect on the rights and obligations of the Parties. Notwithstanding anything to the contrary in this Agreement, GE may assign this Agreement and all of its rights, interests and obligations under this Agreement to GE V emova in connection with the transfer of the Assets owned by GE to GE Vernova, subject to GE Vemova agreeing to be bound by all of the terms and conditions of this Agreement and assuming all of the rights, interests and obligations of GE under this Agreement. Immediately upon such assignment and assumption, automatically and without the requirement of any further action by any person or entity, (i) all references in this Agreement to GE shall instead apply to GE Vernova unless the context otherwise requires and (ii) GE shall be unconditionally and irrevocably released and discharged from any and all Liabilities and obligations under or in connection with this Agreement. 10.7 Governing Law; Jurisdiction; Venue. 10.7.1 THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY, PERFORMANCE AND REMEDIES, IN EACH CASE WITHOUT REFERENCE TO ANY CONFLICT OF LAW RULES THAT MIGHT LEAD TO THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION AND WITHOUT THE REQUIREMENT TO ESTABLISH COMMERCIAL NEXUS IN NEW YORK COUNTY. 10.7.2 THE PARTIES AGREE THAT VENUE IN ANY AND ALL ACTIONS AND PROCEEDINGS RELATED TO THE SUBJECT MATTER OF THIS AGREEMENT SHALL BE IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK OR THE COMMERCIAL DIVISION OF THE COURTS OF THE STATE OF 71 4858-895 5-7603.vl
NEW YORK SITTING IN THE COUNTY OF NEW YORK (WHERE FEDERAL WRISDICTION DOES NOT EXIST). THE FOREGOING COURTS SHALL HAVE EXCLUSIVE WRISDICTION FOR SUCH PURPOSE AND THE PARTIES IRREVOCABLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF SUCH COURTS AND IRREVOCABLY WAIVE THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF ANY SUCH ACTION OR PROCEEDING. SERVICE OF PROCESS MAY BE MADE IN ANY MANNER RECOGNIZED BY SUCH COURTS. 10.7.3 EACH OF THE PARTIES HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY, AND IRREVOCABLY WAIVES ITS RIGHT TO A JURY TRIAL WITH RESPECT TO ANY ACTION, CLAIM OR SUIT ARISING OUT OF THIS AGREEMENT, OR THE VALIDITY, PERFORMANCE, OR ENFORCEMENT THEREOF, OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY HEREBY CERTIFIES THAT NEITHER IT NOR ANY OF ITS REPRESENTATIVES HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT IT WOULD NOT SEEK TO ENFORCE THIS WAIVER OF RIGHT TO WRY TRIAL. FURTHER, EACH PARTY ACKNOWLEDGES THAT THE OTHER PARTY RELIED ON THIS WAIVER OF RIGHT TO JURY TRIAL AS A MATERIAL INDUCEMENT TO ENTER INTO THIS AGREEMENT. 10.8 Counterparts. This Agreement may be executed in two or more counterparts and by facsimile, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 10.9 Schedules. The Schedules have been arranged for purposes of convenience in separately titled sections corresponding to Sections of this Agreement. Any fact or item disclosed on any Schedule to this Agreement shall be deemed disclosed on all other Schedules to this Agreement to which such fact or item may reasonably apply so long as such disclosure is in sufficient detail to enable a Party to identify the facts or items to which it applies. The information contained in this Agreement and in the Schedules and Exhibits hereto is disclosed solely for purposes of this Agreement, and no information contained herein or therein shall be deemed to be an admission by any party hereto to any third party of any matter whatsoever (including any violation of Law or breach of contract). Any fact or item disclosed on any Schedule hereto shall not by reason only of such inclusion be deemed to be material and shall not be employed as a point of reference in determining any standard of materiality under this Agreement. Capitalized terms used in the Schedules and not otherwise defined therein have the meanings given to them in this Agreement. 10 .10 Entire Agreement. This Agreement and the Ancillary Agreements, including the Exhibits, Schedules, documents, certificates and instruments referred to herein or therein, and any other documents that specifically reference this Section 10.10, embody the entire agreement and understanding of the Parties in respect of the transactions contemplated by this Agreement and shall supersede all previous oral and written and all contemporaneous oral negotiations, commitments and understandings including all letters, memoranda or other documents or communications, whether oral, written or electronic, submitted or made by (i) either Buyer or its Representatives to Sellers or their Representatives; or (ii) Sellers or their Representatives to Buyer or its Representatives, in connection with the sale process that occurred prior to the execution of this Agreement or otherwise in connection with the negotiation and execution of this Agreement. 72 4858-895 5-7603.vl
10.11 Acknowledgment; Independent Due Diligence. 10.11.1 EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH HEREIN, THE ASSETS ARE SOLD "AS-IS , WHERE-IS," AND SELLERS EXPRESSLY DISCLAIM ANY AND ALL OTHER REPRESENTATIONS AND WARRANTIES OF ANY KIND OR NATURE, EXPRESS OR IMPLIED, AS TO THE ASSETS , INCLUDING THE V ALLECITOS LICENSED FACILITIES, THE V ALLECITOS NUCLEAR CENTER, THE VNC CONTRACTS AND THE ASSUMED LIABILITIES. BUYER ACKNOWLEDGES AND AGREES THAT NONE OF SELLERS OR THEIR AFFILIATES HAVE MADE ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY OR COMPLETENESS OF ANY INFORMATION REGARDING THE ASSETS , INCLUDING THE V ALLECITOS LICENSED FACILITIES, THE V ALLECITOS NUCLEAR CENTER, THE VNC CONTRACTS OR THE ASSUMED LIABILITIES NOT INCLUDED IN THIS AGREEMENT AND THE SCHEDULES. NO COMMUNICATIONS BY OR ON BEHALF OF SELLERS, INCLUDING RESPONSES TO ANY QUESTIONS OR INQUIRIES, WHETHER ORALLY, IN WRITING OR ELECTRONICALLY, AND NO INFORMATION PROVIDED IN ANY DATA ROOM OR ANY COPIES OF ANY INFORMATION FROM ANY DATA ROOM PROVIDED TO BUYER OR PARENT GUARANTOR OR ANY OTHER INFORMATION SHALL BE DEEMED TO (I) CONSTITUTE A REPRESENTATION, WARRANTY, COVENANT, UNDERTAKING OR AGREEMENT OF SELLERS; OR (II) BE PART OF THIS AGREEMENT. NEITHER SELLERS NOR THEIR AFFILIATES SHALL HAVE OR BE SUBJECT TO ANY LIABILITY TO BUYER, PARENT GUARANTOR OR ANY OTHER PERSON, WITH RESPECT TO ANY INFORMATION, DOCUMENTS OR MATERIALS FURNISHED OR MADE AVAILABLE BY OR ON BEHALF OF SELLERS OR ANY OF THEIR AFFILIATES , OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR ADVISORS , IN ANY "DATA" OR "DUE DILIGENCE" ROOMS OR SITES, ANY PRESENTATIONS OR ANY OTHER FORM IN CONTEMPLATION OF THE TRANSACTIONS CONTEMPLATED HEREBY. 10.11.2 BUYER FURTHER ACKNOWLEDGES THAT BUYER AND ITS AFFILIATES HAS KNOWLEDGE AND EXPERIENCE IN TRANSACTIONS OF THIS TYPE AND IN THE DECOMMISSIONING OF NUCLEAR FACILITIES AND BUYER IS THEREFORE CAPABLE OF EVALUATING THE RISKS AND MERITS OF ACQUIRING THE ASSETS , ASSUMING THE ASSUMED LIABILITIES, CONSUMMATING THE TRANSACTIONS CONTEMPLATED IN THIS AGREEMENT AND THE ANCILLARY AGREEMENTS, AND PERFORMING ITS OBLIGATIONS HEREUNDER AND THEREUNDER. BUYER HAS RELIED ON ITS OWN INDEPENDENT INVESTIGATION AND PERFORMED ITS OWN ANALYSIS OF THE ASSETS AND THE ASSUMED LIABILITIES, AND HAS NOT RELIED ON ANY INFORMATION OR REPRESENTATIONS OR WARRANTIES , WHETHER EXPRESSED OR IMPLIED, AT COMMON LAW OR STATUTE, FURNISHED BY SELLERS OR ANY OF THEIR AFFILIATES OR THEIR RESPECTIVE REPRESENTATIVES (EXCEPT AS SPECIFICALLY SET FORTH IN THIS AGREEMENT), IN DETERMINING TO ENTER INTO THIS AGREEMENT AND THE ANCILLARY AGREEMENTS. NONE OF SELLERS, THEIR AFFILIATES OR THEIR RESPECTIVE REPRESENTATIVES HAS GIVEN ANY INVESTMENT, LEGAL OR OTHER ADVICE OR RENDERED ANY OPINION AS TO WHETHER THE PURCHASE OF THE 73 4858-895 5-7603.vl
ASSETS AND THE CONSUMMATION OF THE TRANSACTIONS AS CONTEMPLATED HEREIN AND IN THE ANCILLARY AGREEMENTS IS PRUDENT. 10 .12 Bulk Sales Laws. Buyer acknowledges that, notwithstanding anything in this Agreement to the contrary, Sellers will not comply with the provision of the bulk sales Laws of any jurisdiction in connection with the transactions contemplated by this Agreement. Buyer hereby waives compliance by Sellers with the provisions of the bulk sales Laws of all applicable jurisdictions and shall otherwise indemnify Sellers against any Losses Sellers suffer as a result of such non-compliance. 10 .13 No Joint Venture. Nothing in this Agreement creates or is intended to create an association, trust, partnership, joint venture or other entity or similar legal relationship among the Parties, or impose a trust, partnership or fiduciary duty, obligation, or liability on or with respect to the Parties. no Party is or shall act as or be the agent or representative of any other Party. 10.14 Change in Law. If and to the extent that any Laws or regulations that govern any aspect of this Agreement shall change, so as to make any aspect of this transaction unlawful, then the Parties agree to make such modifications to this Agreement as may be reasonably necessary for this Agreement to accommodate any such legal or regulatory changes, without materially changing the overall benefits or consideration expected hereunder by any Party. 10 .15 Severability. Any term or provision of this Agreement that is held invalid or unenforceable in any situation shall not affect the validity or enforceability of the remaining terms and provisions hereof or the validity or enforceability of the offending term or provision in any other situation; provided, however, that the remaining terms and provisions of this Agreement may be enforced only to the extent that such enforcement in the absence of any invalid terms and provisions would not result in (i) deprivation of a Party of a material aspect of its original bargain upon execution of this Agreement or any of the Ancillary Agreements; (ii) unjust enrichment of a Party; or (iii) any other manifestly unfair or inequitable result. 10 .16 Specific Performance. Each Party acknowledges and agrees that the other Party or Parties would be damaged irreparably in the event any of the provisions of this Agreement are not performed in accordance with their specific terms or otherwise are breached. Accordingly, each Party agrees that the other Parties shall be entitled to an injunction or injunctions to prevent breaches of the provisions of this Agreement and to enforce specifically this Agreement and the terms and provisions hereof in addition to any other remedy to which it may be entitled, at law or in equity. Each of the Parties hereby further waives (a) any defense in any action for specific performance that a remedy at law would be adequate and (b) any requirement under any Law to post security as a prerequisite to obtaining equitable relief 10.17 Appointment of Representative. As of the Contract Date, GEH hereby appoints GE as its lawful attorney in fact of GEH, with full power and authority, including full power of substitution, acting in the name of and for and on behalf of GEH, without the consent of GEH, to exercise in GE ' s sole and absolute discretion the powers that GEH could exercise under this Agreement with respect to all of GEH's rights and obligations under this Agreement (including amending or waiving any right or obligation under this Agreement), to resolve any dispute with Buyer over any aspect of this Agreement, and on behalf of GEH, to enter into any agreement, 74 4858-895 5-7603.vl
instrument or other document to effectuate any of the foregoing, which shall have the effect of binding GEH as ifGEH had personally entered into such agreement, instrument or document. This appointment and power of attorney shall be deemed as coupled with an interest and all authority conferred hereby shall be irrevocable and shall not be subject to termination by operation of law, whether by the dissolution, merger, reorganization or bankruptcy of any Seller or the occurrence of any other event or events. 10.18 Non-Recourse. All claims, obligations, liabilities, or causes of action (whether in contract or in tort, in Law or in equity, or granted by statute) that may be based upon, in respect of, arise under, out or by reason of, be connected with, or relate in any manner to this Agreement or any of the Ancillary Agreements, or the negotiation, execution, or performance of this Agreement or any of the Ancillary Agreements (including any representation or warranty made in, in connection with, or as an inducement to, such agreements), may be made only against (and are expressly limited to) the entities that are expressly identified as parties in the preamble to this Agreement or the other Ancillary Agreement, as applicable (the "Contracting Parties"). No Person who is not a Contracting Party, including any past, present or future director, officer, employee, incorporator, member, partner, manager, stockholder, Affiliate, agent, attorney, or representative of, and any financial advisor or lender to, any Contracting Party, or any director, officer, employee, incorporator, member, partner, manager, stockholder, Affiliate, agent, attorney, or representative of, and any financial advisor or lender to, any of the foregoing ("Nonparty Affiliates"), shall have any liability (whether in contract or in tort, in Law or in equity, or granted by statute) for any claims, causes of action, obligations, or liabilities arising under, out of, in connection with, or related in any manner to , this Agreement or any Ancillary Agreement or based on, in respect of, or by reason of this Agreement, any Ancillary Agreement or their negotiation, execution, performance, or breach; and, to the maximum extent permitted by Law, each Contracting Party hereby waives and releases all such liabilities, claims, causes of action, and obligations against any such Nonparty Affiliates. {Remainder ofpage intentionally left blank} 75 4858-8955-7603.vl
IN WITNESS WHEREOF, the Parties have caused this Agreement to be signed by their respective duly authorized officers as of the date first above written. NORTHSTAR D&D, LLC By~~ Nam~t~ate
Title:
Chief Executive Officer (Signature page to Asset Purchase and Sale Agreement)
GENERAL ELECTRIC COMPANY By: Jj UY~ m~ Name: Geoffrey Marsh
Title:
Authorized Signatory (Signature page to Asset Purchase and Sale Agreement)
GE-HITACHI NUCLEAR ENERGY AMERICAS LLC _* .* 2 By: . . Name: Jay T. Wileman
Title:
President & Chief Executive Officer (Signature page to Asset Purchase and Sale Agreement)
EXHIBIT I FORM OF NUCLEAR DECOMMISSIONING FUND TRUST AGREEMENT Exhibit I
NUCLEAR DECOMMISSIONING TRUST AGREEMENT THIS NUCLEAR DECOMMISSIONING TRUST AGREEMENT (the "Agreement"), dated as of [*] (the "Effective Date"), is entered into between General Electric Company, a corporation duly organized and existing under the laws of the State of New York, having its principal office at One Financial Center, Suite 3700, Boston, MA 02211 (the "Company"), and[*], as Trustee, having its principal office at [*] (the "Trustee"). WHEREAS, GE-Hitachi Nuclear Energy Americas LLC, a Delaware limited liability company ("GEH"), is the owner of l 00% of the Vallecitos Nuclear Center located in Sunol, California (the "Vallecitos Nuclear Center"), which includes the facilities and nuclear materials that are subject to the following licenses issued by the United States Nuclear Regulatory Commission (or any successor agency thereto, the "NRC"): (a) NRC Facility Possession-Only License No. TR-1 for the General Electric Test Reactor; (b) NRC Facility Possession-Only License No. DR-10 for the ESDA Experimental Vallecitos Superheat Reactor; (c) NRC Facility Operating License No. R-33 for the Nuclear Test Reactor; (d) NRC Facility Possession-Only License No. DPR-1 for the Vallecitos Boiling Water Reactor; and (e) NRC Materials License Nos. SNM-960 and SNM-1270 for the Vallecitos Nuclear Center (collectively, the licenses described in (a) through (e), together with any other amendments to, or consents, orders and approvals from the NRC issued in connection with any of the foregoing , the "NRC Licenses"); WHEREAS, certain of the nuclear material located at the Vallecitos Nuclear Center and activities undertaken therein are subject to the California Department of Public Health ("Cal DPH") Radioactive Materials License 0017-01 (collectively, together with any other amendments to, or consents, orders or approvals from the Cal DPH issued in connection with the foregoing, the "Cal DPH License"); WHEREAS, the Company is the owner of one hundred percent (100%) of the fee title interest to the real property on which the Vallecitos Nuclear Center is located; WHEREAS, the Company wishes to create a nuclear decommissioning trust fund (the "Trust"), under the laws of the Commonwealth of Pennsylvania that is a "nonqualified nuclear decommissioning fund" within the meaning of U.S. Department of Treasury Regulations Section l .338-6(c)(5); WHEREAS, the Company wishes that the Trustee serve, and Trustee agrees to serve, as Trustee of the Trust under the laws of the Commonwealth of Pennsylvania; WHEREAS, the Company desires to maintain the Trust herein described as a means (a) of financing the decommissioning of the Vallecitos Nuclear Center in accordance with the Rules and Regulations of the NRC and the Cal DPH; and (b) to assure the Company' s financial ability to meet the obligations to the NRC, the Cal DPH, other applicable regulatory bodies and the general public in connection with said decommissioning; WHEREAS, in connection with the closing of the sale of the Vallecitos Nuclear Center to NorthStar Vallecitos, LLC, a Delaware limited liability company ("Buyer") (such closing, the "Vallecitos Sale"), the Company anticipates, prior to the Vallecitos Sale, assigning its interest in this Agreement, directly or indirectly through a series of assignments through entities in the chain of ownership between GE and GEH, to GEH and, in connection with the Vallecitos Sale, that GEH will assign its interest in this Agreement to Buyer; and WHEREAS, the execution and delivery of this Agreement have been duly authorized by the Company and the Trustee and all things necessary to make this Agreement a valid and binding agreement by the Company and the Trustee have been done;
NOW, THEREFORE, to provide for the creation, funding and maintenance of the Trust and the making of payments therefrom and the performance of the covenants of the Company and the Trustee set forth herein, the Company agrees to create and the Trustee agrees to accept the Trust and to maintain and administer the Trust for the exclusive purpose of providing funds for the decommissioning of the Vallecitos Nuclear Center in order to satisfy the liability in connection therewith, to pay the administrative costs and other incidental expenses of the Trust, and to make certain investments, all as hereinafter provided. ARTICLE 1 Formation of Trust; Purposes of the Trust: Contributions Section 1.01. Establishment of the Trust. (a) The name of the Trust shall be the "Vallecitos Nuclear Decommissioning Trust," and the Trust shall be an irrevocable trust. The Company hereby establishes and confirms the establishment with the Trustee of the Trust. The Trustee hereby accepts the Trust created under this Agreement and agrees to perform the Trustee's duties under this Agreement. (b) The Trust shall be maintained at all times in the United States pursuant to this Agreement and in accordance with the laws of the Commonwealth of Pennsylvania. The Trust shall include: (A) all cash and investments thereof, as more specifically described in Section 3.02; (B) all dividends, interest, cash, instruments, and other property from time to time received, receivable, or otherwise distributed or distributable in respect of or in exchange for any or all such investments; (C) all rights and privileges with respect to such investments; and (D) all proceeds of any of the foregoing and any property of any character whatsoever into which any of the foregoing may be converted. The Trustee shall maintain such records as are necessary to reflect the Trust separately on its books and shall create and maintain such subaccounts within the Trust as the Company shall direct. Section 1.02. Purposes of the Trust. The Trust is established for the exclusive purpose of providing funds for the decommissioning of the Vallecitos Nuclear Center. The Trust shall accumulate all contributions (whether from the Company or others) received for the purposes of decommissioning the Vallecitos Nuclear Center. None of the assets of the Trust shall be subject to attachment, garnishment, execution or levy in any manner for the benefit of creditors of the Company or any other party. Section 1.03. Contributions to the Trust. The Company ( or others approved in writing by the Company) shall contribute cash or securities to the Trust from time to time. The Company intends to initially fund the trust with assets that will be appropriate to fund payment of Decommissioning Costs, as such term is defined in Section 2.01 , over the expected decommissioning period without the need for significant turnover of assets. The Company shall have sole discretion as to whether contributions are allocated to any specific subaccount within the Trust. ARTICLE 2 Payments by the Trustee Section 2.01. Use of Assets. The assets of the Trust shall be used exclusively (a) to satisfy, in whole or in part, any expenses or liabilities incurred with respect to the decommissioning of the Vallecitos Nuclear Center or any portion, component or structure thereof, including expenses incurred in connection with the preparation for decommissioning of the assets subject to the NRC Licenses or any portion, component or structure thereof, including engineering and other planning expenses, and all expenses incurred after the actual decommissioning occurs, such as physical security and radiation monitoring expenses (the "Decommissioning Costs"), (b) to pay the administrative costs and other incidental expenses of the Trust, (c) to make investments (including common trust funds) as directed by the Investment 2
Manager(s) pursuant to Section 3.02(a) or the Trustee pursuant to Section 3.02(b) to support payment of costs described in (a) and (b) above, and ( d) to be distributed to the Company upon termination of this Agreement pursuant to Article 6 hereof. Section 2.02. Certification for Decommissioning Costs. (a) If assets of the Trust are required to satisfy Decommissioning Costs of the Vallecitos Nuclear Center, the Company shall present a certificate, substantially in the form attached hereto as Exhibit A, to the Trustee signed by any person authorized by the Company, as may be designated in writing by the Company to the Trustee from time to time, requesting payment from the Trust. Any certificate requesting payment by the Trustee to a third party or to the Company from the Trust for Decommissioning Costs shall include the following: (1) a statement of the amount of the payment to be made from the Trust; (2) a statement that the payment is requested to pay authorized Decommissioning Costs which have actually been incurred; (3) a description of the nature of the Decommissioning Costs to be paid; (4) the payee, which may be the Company in the case of reimbursement for payments previously made or expenses previously incurred by the Company for Decommissioning Costs; ( 5) a statement that the Decommissioning Costs for which payment is requested have not theretofore been paid out of the Trust; (6) a statement that any necessary authorizations of the NRC, Cal DPH and any other governmental agencies having jurisdiction with respect to the decommissioning of the Vallecitos Nuclear Center have been obtained; and (7) a statement of compliance with 10 CFR 50.82(a)(6) and (8) and CCR Title 17 Section 30195.1 and Cal. DPH License No. 0017-01. (b) The Trustee shall retain at least one copy of any certificates (including attachments) and related documents received by it pursuant to this ARTICLE 2. (c) The Company shall have the right to enforce payments from the Trust upon compliance with the procedures set forth in this Section 2.02. ( d) The Company shall have the option to request payment, in whole or part, from the Trustee in the form of property held by the Trust that would otherwise be disposed of to fund the payment. The Trustee, in consultation with the Company, shall accommodate such request to the extent reasonably possible. Section 2.03. Administrative Costs. The Trustee shall pay or as directed by the Company reimburse the Company for the administrative costs and other incidental expenses of the Trust, including all federal, state, and local taxes, if any, imposed directly on the Trust or the income therefrom, expenses incurred in preparing and filing any federal, state, and local tax returns, legal expenses, accounting expenses, actuarial expenses and trustee expenses, from the assets of the Trust. 3
ARTICLE 3 Concerning the Trust Section 3.01. Authority of Trustee. The Trustee shall have the authority and discretion to manage and control the Trust to the extent provided in this Agreement but does not guarantee the Trust in any manner against investment loss or depreciation in asset value or guarantee the adequacy of the Trust to satisfy the Decommissioning Costs. The Trustee shall discharge its duties as fiduciary solely in the interest of the Company, with care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like objectives, and in accordance with the Trust. Except with respect to any investment account of which it is acting as Investment Manager pursuant to Section 3.02 hereof; the Trustee shall be released and relieved of all investment duties, responsibilities and liabilities customarily or statutorily incident to a trustee with respect to the trust funds hereunder, and as to such trust funds the Trustee shall act as a directed Trustee, provided, however, that the Trustee shall, to the extent any assets of the trust funds have not been invested by an Investment Manager or the Company as of the end of any business day, invest such uninvested assets of the trust funds overnight as the Company or such Investment Manager may direct in writing. Section 3.02. Investment of Trust Funds. (a) Pursuant to a written investment management agreement with respect to, and delegating the power and duties regarding, the investment of the funds in the Trust, the Company shall have the authority to appoint one or more independent investment managers (each an "Investment Manager"), which may include the Trustee, to direct the Trustee in investing the assets of the Trust. Any such Investment Manager or other person directing investments made in the Trusts shall adhere to the "prudent investor" standard as specified in 18 C.F.R. 35.32(a)(3) of the Federal Energy Regulatory Commission ("FERC") regulations (the "Prudent Investor Standard"). To the extent that the Company chooses to exercise this authority, it shall so notify the Trustee and instruct the Trustee in writing to separate into a separate account those assets the investment of which will be directed by each Investment Manager. The Company shall designate in writing the person or persons who are to represent any such Investment Manager in dealings with the Trustee. Upon the separation of the assets in accordance with the Company instructions, the Trustee, as to those assets while so separated, shall be released and relieved of all investment duties, investment responsibilities and investment liabilities normally or statutorily incident to a trustee. The Trustee shall retain all other fiduciary duties it has accepted hereunder with respect to assets the investment of which is directed by any Investment Manager. (b) To the extent that the investment of assets of the Trust are not being directed by one or more Investment Managers under Section 3.02(a), the Company will assume management. If so directed, the Trustee shall hold, invest, and reinvest the funds delivered to it hereunder as it in its sole discretion deems advisable, subject to adherence to the Prudent Investor Standard and the requirements of the same Investment Guidelines that would be applicable to any Investment Manager appointed under this Agreement. (c) Notwithstanding any other provision of this Section 3.02, in selecting and managing investments, whether by an Investment Manager, the Trustee, or the Company, the intended Decommissioning Costs funding strategy of the initial composition of the portfolio of Trust assets, as provided in Section 1.03, and the impact of the holding of the investment and any disposition of such investment on the volatility and expected net return of the assets of the Trust, including any fees, commissions, expenses, and tax liabilities attributable to such holdings and dispositions (whether such items 4
are paid or otherwise taken into account inside or outside of the Trust), shall be taken into account and shall be deemed to be consistent with applicable law and the Prudent Investor Standard with respect to the Trust. Section 3.03. Compensation. The Trustee shall be paid such reasonable compensation for services rendered by it, as well as expenses necessarily incurred by it in the execution of the Trust, as shall from time to time be agreed upon by the Company and the Trustee either through payments from the Trust or directly from the Company. Section 3.04. Books of Account and Taxes. The Trustee shall keep separate true and correct books of account with respect to the Trust, which books of account shall at all reasonable times be open to inspection by the Company or its duly appointed representatives or designees. The Trustee shall be authorized to establish separate subaccounts for each of the NRC Licenses or the Cal DPH License if (a) requested by the Company, (b) it reasonably determines such subaccounts are prudent, or ( c) to the extent required by the NRC or Cal DPH. The Trustee shall, upon written request of the Company, permit the Company (including its representatives or designees) or any governmental agencies, such as the FERC, NRC, Cal DPH, or the Internal Revenue Service, to inspect the books of account of the Trust. The Trustee shall furnish to the Company on or about the tenth business day of each month a statement for the Trust showing, with respect to the preceding calendar month, the balance of assets on hand at the beginning of such month, all receipts, investment transactions, and disbursements which took place during such month and the balance of assets on hand at the end of such month. The Trustee is responsible for account valuations for all purposes under this Agreement. Such account valuations shall report the fair market value of assets of each trust fund based upon information and financial publications of general circulation, statistical and valuation services, records of security exchanges, appraisals by qualified persons, transactions and bona fide offers in assets of the type in question, or other information customarily used in the valuation of property. When a value is not readily obtainable from these sources, the Trustee may rely on valuations provided by the Investment Manager or the Company if the Company has not selected an Investment Manager. The Company shall prepare, or cause to be prepared, any tax returns required to be filed by the Trust, and the Trustee shall review, approve, sign and file such returns on behalf of the Trust. The Company and Trustee shall cooperate in good faith in providing information for preparing the returns and in determining the reasonableness of tax positions and reporting on such returns. The Company shall cause to be prepared and filed all tax returns as may be required with respect to income earned by, or the assets of, the Trust hereunder and the Trustee shall pay any taxes due, or at the direction of the Company, reimburse the Company out of the Trust. The Trustee agrees to provide each month, on a timely basis, any information deemed necessary by the Company to file the Company's federal, state and local tax returns, to record Trust activity on the Company's financial statements, and to report Trust activity to the NRC or any other regulatory authority. Section 3.05. Reliance on Documents. The Trustee, upon receipt of documents furnished to it by the Company pursuant to the provisions of this Agreement, shall examine the same to determine whether they conform to the requirements thereof. The Trustee acting in good faith may conclusively rely, as to the truth of statements and the correctness of opinions expressed, on any certificate or other documents conforming to the requirements of this Agreement. If the Trustee, in the administration of the Trust, shall deem it necessary or desirable that a matter be provided or established prior to taking or suffering any action hereunder, such matter (unless evidence in respect thereof is otherwise specifically prescribed hereunder) may be deemed by the Trustee to be conclusively provided or established by a certificate signed by the designated authorized signatory of the Company and delivered to the Trustee. The Trustee shall have no duty to inquire into the validity, accuracy or relevancy of any statement contained in any certificate or document nor the authorization of any party making such certificate or delivering such document, and the 5
Trustee may rely and shall be protected in acting upon any such written certificate or document furnished to it hereunder and believed by it to be genuine and to have been signed or presented by the proper party or parties. The Trustee shall not, however, be relieved of any obligation to adhere to the Prudent Investor Standard if acting as investment manager. Section 3.06. Liability and Indemnification. The Trustee shall not be liable for any action taken by it in good faith and without negligence, willful misconduct or recklessness and reasonably believed by it to be authorized or within the rights or powers conferred upon it by this Agreement and may consult with counsel of its own choice (including counsel for the Company). The Trustee shall have full and complete authorization and protection for any action taken or suffered by it hereunder in good faith and without negligence and in accordance with the opinion of such counsel. The Company hereby agrees to indemnify the Trustee for, and to hold it harmless against, any loss, liability or expense incurred without negligence, willful misconduct, recklessness or bad faith on the part of the Trustee, arising out of or in connection with its entering into this Agreement and carrying out its duties hereunder, including the costs and expenses of defending itself against any claim of liability. The Trustee shall not be responsible or liable for any losses or damages suffered by the Trust arising as a result of the insolvency of any custodian, sub-trustee, or sub-custodian, except to the extent the Trustee was negligent in its selection or continued retention of such entity. Section 3.07. Resignation, Removal, and Successor Trustees. The Trustee may resign at any time upon sixty (60) days' prior written notification to the Company. The Company may remove the Trustee for any reason at any time upon thirty (30) days' prior written notification to the Trustee. If a successor trustee shall not have been appointed within these specified time periods after the giving of written notice of such resignation or removal, the Trustee or Company may apply to any court of competent jurisdiction to appoint a successor trustee to act until such time, if any, as a successor shall have been appointed and shall have accepted its appointment as provided below. If the Trustee shall be adjudged bankrupt or insolvent, a vacancy shall thereupon be deemed to exist in the office of the Trustee and a successor shall thereupon be appointed by the Company. Any successor trustee, however appointed hereunder (including any successor by merger, consolidation or transfer as contemplated by Section 3.08) shall be a bank or trust company with trust powers incorporated and doing business in the United States of America and having net worth of at least $500,000,000; provided however, that in calculating the $500,000,000 net worth requirement, the net worth of the successor trustee's parent corporation and/or affiliates may be taken into account only if such entities guarantee the successor trustee's responsibilities to the Trust. Any successor trustee shall execute, acknowledge and deliver to the Company an appropriate written instrument accepting such appointment hereunder, subject to all the terms and conditions hereof, and thereupon such successor trustee shall become the Trustee hereunder and be fully vested with all the rights, powers, trusts, duties and obligations of its predecessor in trust hereunder, with like effect as if originally named as Trustee hereunder. The predecessor Trustee shall, upon written request of the Company and payment of all fees and expenses, deliver to the successor Trustee the corpus of the Trust and perform such other acts as may be required or be desirable to vest and confirm in said successor Trustee all right, title and interest in the corpus of the Trust to which it succeeds. Section 3.08. Merger of Trustee. Any corporation or other legal entity into which the Trustee may be merged or with which it may be consolidated, or any corporation or other legal entity resulting from any merger or consolidation to which the Trustee shall be a party, or any corporation or other legal entity to which the corporate trust functions of the Trustee may be transferred, shall be the successor Trustee under this Agreement without the necessity of executing or filing any additional acceptance of this Agreement or the performance of any further act on the part of any other parties hereto; provided however, that upon any such consolidation, merger, conveyance or transfer, the successor entity or entities shall assume the due and punctual performance and observance of all the conditions of this Agreement, with the 6
same effect and to the same extent as if such successor entity or entities had been the party of the first part hereto. ARTICLE 4 Amendments Section 4.01. Agreement Irrevocable. It is intended that this Agreement is irrevocable and that the Company has no power or authority to alter, amend, revoke, or annul any provisions hereof except as provided in this ARTICLE 4. Section 4.02. Permitted Amendments. Notwithstanding the provisions of Section 4.01 and subject to the requirements of Section 4.03 , the Company may amend this Agreement from time to time; provided that if a proposed amendment shall affect the responsibility of the Trustee, such amendment shall not be considered valid and binding until such time as the amendment is executed by the Trustee. An amendment may be effective retroactively if such application is necessary to bring the Trust or the Company into conformity with any applicable statute or regulation. Section 4.03. Notification of Proposed Amendments to NRC and Cal DPH. Any material amendment permitted pursuant to Section 4.02 shall not be effective unless and until the Company provides written notification at least 30 working days prior to the proposed effective date of the amendment to (i) the Director, Office of Nuclear Material Safety and Safeguards within the NRC, and (ii) the Cal DPH, and does not receive a written objection from either within such 30 working day period. The written notification provided under this Section 4.03 shall include the text of the proposed amendment and a statement of the reason for the proposed amendment. Notwithstanding anything to the contrary in this Agreement, the proposed amendment shall be null and void if the Company or the Trustee receives written notice of objection from (i) the Director, Office of Nuclear Material Safety and Safeguards or (ii) Cal DPH within the 30 working days set forth in this Section 4.03. Section 4.04. Merger, Consolidation and Succession of Company. A corporation or other legal entity with which the Company is merged or a corporation or other legal entity which acquires substantially all of the assets related to the Vallecitos Nuclear Center and is obligated to bear the obligations and costs of decommissioning the Vallecitos Nuclear Center, shall, upon delivery to the Trustee of a written instrument accepting and assuming the powers and obligations of the Company hereunder, become the Company for all purposes under this Agreement, and thereupon every reference in this Agreement to the Company shall be deemed to be a reference to that surviving or purchasing corporation or other legal entity. ARTICLE 5 Powers of the Trustee and Investment Manager Section 5.01. General Powers. The Trustee shall have and exercise the following powers and authority in the administration of the Trust only on the direction of an Investment Manager where such powers and authority relate to a separate account established for an Investment Manager, and in its sole discretion where such powers and authority relate to investments made by the Trustee in accordance with Section 3.02(b): (a) to purchase, receive or subscribe for any securities or other property and to retain in trust such securities or other property; (b) to sell, exchange, convey, transfer, lend, or otherwise dispose of any property held in the Trust and to make any sale by private contract or public auction; and no person dealing with the Trustee 7
shall be bound to see to the application of the purchase money or to inquire into the validity, expediency or propriety of any such sale or other disposition; ( c) to vote in person or by proxy any stocks, bonds or other securities held in the Trust; ( d) to exercise any rights appurtenant to any such stocks, bonds or other securities for the conversion thereof into other stocks, bonds or securities, or to exercise rights or options to subscribe for or purchase additional stocks, bonds or other securities, and to make any and all necessary payments with respect to any such conversion or exercise, as well as to write options with respect to such stocks and to enter into any transactions in other forms of options with respect to any options which the Trust has outstanding at any time; (e) to join in, dissent from or oppose the reorganization, recapitalization, consolidation, sale or merger of corporations or properties of which the Trust may hold stocks, bonds or other securities or in which it may be interested, upon such terms and conditions as deemed wise, to pay any expenses, assessments or subscriptions in connection therewith, and to accept any securities or property, whether or not trustees would be authorized to invest in such securities or property, which may be issued upon any such reorganization, recapitalization, consolidation, sale or merger and thereafter to hold the same, without any duty to sell; (f) to enter into any type of contract with any insurance company or companies, either for the purposes of investment or otherwise; provided that no insurance: company dealing with the Trustee shall be considered to be a party to this Agreement and shall only be bound by and held accountable to the extent of its contract with the Trustee. Except as otherwise provided by any contract, the insurance company need only look to the Trustee with regard to any instructions issued and shall make disbursements or payments to any person, including the Trustee, as shall be directed by the Trustee. Where applicable, the Trustee shall be the sole owner of any and all insurance policies or contracts issued. Such contracts or policies, unless otherwise determined, shall be held as an asset of the Trust for safekeeping or custodian purposes only; (g) upon authorization of the Company to lend the assets of the Trust and, specifically, to loan any securities to brokers, dealers or banks upon such terms, and secured in such manner, as may be determined by the Trustee, to permit the loaned securities to be transferred into the name of the borrower or others and to permit the borrower to exercise such rights of ownership over the loaned securities as may be required under the terms of any such loan; and (h) to purchase, enter, sell, hold, and generally deal in any manner in and with contracts for the immediate or future delivery of financial instruments of any issuer or of any other property and in foreign exchange or foreign exchange contracts; to grant, purchase, sell, exercise, permit to expire, permit to be held in escrow, and otherwise to acquire, dispose of, hold and generally deal in any manner with and in all forms of options in any combination. Settlements of transactions may be effected in trading and processing practices customary in the jurisdiction or market where the transaction occurs. The Company acknowledges that this may, in certain circumstances, require the delivery of cash or securities (or other property) without the concurrent receipt of securities (or other property) or cash and, in such circumstances, the Company shall have sole responsibility for nonreceipt of payment (or late payment) by the counterparty. Section 5.02. Specific Powers of the Trustee. The Trustee shall have the following powers and authority, to be exercised in its sole discretion with respect to the Trust: 8
(a) to appoint agents, custodians, depositories or counsel as to part or all of the Trust and functions incident thereto where, in the sole discretion of the Trustee, such delegation is necessary in order to facilitate the operations of the Trust and such delegation is not inconsistent with the purposes of the Trust or in contravention of any applicable law. To the extent that the appointment of any such person or entity may be deemed to be the appointment of a fiduciary, the Trustee may exercise the powers granted hereby to appoint as such a fiduciary any person or entity. Upon such delegation, the Trustee may require such reports, bonds or written agreements as it deems necessary to properly monitor the actions of its delegate; (b) to cause any investment, either in whole or in part, in the Trust to be registered in, or transferred into, the Trustee' s name or the names of a nominee or nominees, including but not limited to that of the Trustee or an affiliate of the Trustee, a clearing corporation, or a depository, or in book-entry form, or to retain any such investment unregistered or in a form permitting transfer by delivery, provided that the books and records of the Trustee shall at all times show that such investments are a part of the Trust; and to cause any such investment, or the evidence thereof, to be held by the Trustee, in a depository, in a clearing corporation, in book-entry form, or by any other entity or in any other manner permitted by law; (c) to make, execute and deliver, as Trustee, any and all deeds, leases, mortgages, conveyances, waivers, releases or other instruments in writing necessary or desirable for the accomplishment of any of the foregoing powers; ( d) to defend against or participate in any legal actions involving the Trust or the Trustee in its capacity stated herein, in the manner and to the extent it deems advisable; (e) to form corporations and to create trusts, to hold title to any security or other property, to enter into agreements creating partnerships or joint ventures for any purpose or purposes determined by the Trustee to be in the best interests of the Trust; (f) to establish and maintain such separate accounts in accordance with the instructions of the Company as the Company deems necessary for the proper administration of the Trust, or as determined to be necessary by the Trustee; (g) to hold uninvested cash in its commercial bank or that of an affiliate, as it shall deem reasonable or necessary; (h) to invest in any collective, common or pooled trust fund operated or maintained exclusively for the commingling and collective investment of monies or other assets including any such fund operated or maintained by the Trustee or an affiliate. The Company expressly understands and agrees that any such collective fund may provide for the lending of its securities by the collective fund trustee and that such collective fund ' s trustee will receive compensation for the lending of securities that is separate from any compensation of the Trustee hereunder, or any compensation of the collective fund trustee for the management of such collective fund; and (i) to generally take all action, whether or not expressly authorized, which the Trustee may deem necessary or desirable for the protection of the Trust and to administer the Trust and to carry out the purposes of this Agreement. Section 5.03. Instructions of the Company. The powers described in Section 5.02 may be exercised by the Trustee with or without instructions from the Company or a party authorized by the Company to act on its behalf, but where the Trustee acts on the written instructions of the Company, the Trustee shall be fully protected as described in Section 3.06. All directions and instructions to the Trustee 9
from an authorized person designed by the Company shall be in writing, by facsimile transmission, electronic transmission subject to the Trustee's practices, or any other method specifically agreed to in writing by the Company and the Trustee, provided the Trustee may, in its discretion, accept oral directions and instructions and may require confirmation in writing. Section 5.04. Limitation on Investments. (a) Except as otherwise permitted by this Agreement, no person directing investments shall cause the assets of a Trust to be invested in any of the following: (1) securities or obligations of the Company or affiliates thereof, or their successors or assigns as identified in writing by the Company; (2) securities or other obligations in any entity owning or operating one or more nuclear power plants or its affiliates, subsidiaries, successors or assigns; or (3) a mutual fund in which at least 50 percent of the fund is invested in the securities of one or more licensees or one or more parent companies whose subsidiary is an owner or operator of a foreign or domestic nuclear power plant. (b) Notwithstanding the provisions of subsection (a) of Section 5.04, the assets ofa Trust may be invested in securities tied to market indices or other non-nuclear sector collective, commingled, or mutual funds, provided that no more than ten percent (10%) of the assets of such trust may be directly invested in securities of any entity owning or operating one or more nuclear power plants. ARTICLE 6 Termination Section 6.01. Termination Resulting From Termination of Purchase Agreement. In the event that this Agreement is not assigned to Buyer within sixty ( 60) days of the Effective Date in accordance with the proviso in the second sentence of Section 7.05, the Company shall have the right to terminate the trust at any time upon notice to the Trustee. Section 6.02. Termination upon Completion of Decommissioning. In the event that this Agreement is assigned to Buyer within sixty (60) days of the Effective Date in accordance with the proviso in the second sentence of Section 7. 05 , the Trust shall terminate upon achievement of the "End State Conditions" (which includes completion of decommissioning activities and termination of the NRC Licenses and the Cal DPH License) as certified by Company to the Trustee by presentation by the Company to the Trustee of a certification in the form of Exhibit B. Section 6.03. Distribution of Assets in the Trust. Any assets remaining in the Trust hereunder upon termination in accordance with this ARTICLE 6, upon receipt of a certificate from an appropriately designated officer of the Company, shall be distributed by the Trustee to the Company in accordance with the terms and conditions prescribed by the governmental regulatory body having jurisdiction. ARTICLE 7 Miscellaneous Section 7.01. Binding Agreement. All covenants and agreements in this Agreement shall be binding upon and inure to the benefit of the respective parties hereto, their successors and assigns.
Section 7.02. Notices. All notices and communications hereunder shall be in writing and shall be deemed to be duly given, if delivered personally or by electronic mail, or mailed overnight courier or registered or certified mail (return receipt requested), postage prepaid, to the recipient at its address set forth below: If to the Company: [General Electric Company] One Financial Center, Suite 3700, Boston, MA 02211 Attention: Senior Counsel, Merger & Acquisitions Email: ma.transactions@ge.com and [*] [Address] [Address] Attention: [*] or at such other address as the Trustee or Company may have furnished to the other party by notice given in accordance with this Section 7.02. Section 7.03. Governing Law. The Trust has been established pursuant to this Agreement in accordance with the requirements for trusts under the laws of the Commonwealth of Pennsylvania and this Agreement shall be governed by and construed and enforced in accordance with the laws of the Commonwealth of Pennsylvania. Section 7.04. Counterparts. This Agreement may be executed in several counterparts, and all such counterparts executed and delivered, each an original, shall constitute but one and the same instrument. Section 7.05. Succession and Assignment. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. No party hereto shall have any right to assign this Agreement or any of its respective rights or obligations hereunder to any other person without the prior written consent of the non-assigning party hereto, such consent not to be unreasonably withheld, delayed, or conditioned, and any purported assignment in violation of this provision shall be null and void, provided that this Agreement may be assigned (in its entirety, in one assignment or in a series of assignments) by Company (or its assigns) (a) prior to the Vallecitos Sale, to GEH (which may be accomplished by direct assignment or a series of assignments or contributions by Company to GENE Holding LLC and then subsequently to GE-Hitachi Nuclear Energy Holdings LLC and then subsequently to GEH) and (b) in connection with the Vallecitos Sale, to Buyer, in each case, within sixty (60) days of the Effective Date without the need for prior written consent of Trustee and, immediately upon such assignment and the assumption by such assignee, automatically and without the requirement of any further action by any person: (x) all references in this Agreement to Company shall instead apply to such assignee and (y) such assignor shall be unconditionally and irrevocably released and discharged from any and all liabilities and obligations under or in connection with this Agreement. Section 7.06. Intention of Parties with respect to Tax Treatment of the Trust. The parties hereto intend that the Trust: 11
(a) qualify as a "nonqualified nuclear decommissioning fund" within the meaning of Treasury Regulations Section l.338-6(c)(5)(ii); and (b) be classified for United States federal income tax purposes as a grantor trust under Subpart E, Part I, Sub chapter J, Chapter l of Subtitle A of the Code, and not for such purposes as a non-grantor trust or as a business entity. The Company agrees to treat the Trust as a grantor trust for all United States federal, state and local income tax purposes. Except solely to the extent different treatment is prescribed for certain tax purposes pursuant to an election under Treasury Regulations Section l .338-6(c)(5), neither the Company pursuant to Section 7.05 or otherwise nor the Trustee, shall be authorized or empowered to take any action or through failure to take any action cause the Trust to fail to qualify as a grantor trust for United States federal, state and local income tax purposes at all times. Section 7.07. Authority. The Company and the Trustee hereby each represent and warrant to the other that it has full authority to enter into this Agreement upon the terms and conditions hereof and that the individual executing this Agreement on its behalf has the requisite authority to bind the Company and the Trustee to this Agreement. 12
IN WITNESS WHEREOF, the parties hereto, each intending to be legally bound hereby, have hereunto set their hands and seals as of the day and year first above written. General Electric Company By: _ _ _ _ _ _ _ _ _ _ __ Name:
Title:
By: _ _ _ _ _ _ _ _ _ _ __ Name:
Title:
EXHIBIT A CERTIFICATE FOR PAYMENT OF DECOMMISSIONING COSTS [*]' as Trustee [Address] This Certificate is submitted pursuant to Section 2.02 of the Nuclear Decommissioning Trust Agreement (the "Agreement"), dated [*]between [*] (the "Trustee") and [*] (the "Company"). All capitalized terms used in this Certificate and not otherwise defined herein shall have the meanings assigned to such terms in the Agreement. In your capacity as Trustee, you are hereby authorized and requested to disburse out of the Trust to [Company or other payee] the amount of$ ____ from the Trust, such amount to be disbursed to [Company or other payee](($ _ _ _ in cash] and/or [ $_ _ __ in property of the Trust)) for the payment of the Decommissioning Costs which have been incurred with respect to the Vallecitos Nuclear Center. With respect to such Decommissioning Costs, the Company hereby certifies as follows:
- 1. The amount to be disbursed pursuant to this Certificate shall be solely used for the purpose of paying the Decommissioning Costs described in a schedule attached hereto ("Schedule of Decommissioning Costs").
- 2. This request is due and owing for goods or services provided in connection with the decommissioning of the Vallecitos Nuclear Center.
- 3. None of the Decommissioning Costs described in the Schedule of Decommissioning Costs have previously been made the basis of any certificate pursuant to Section 2. 02 of the Agreement.
- 4. Any necessary authorizations of the NRC or any corresponding governmental authority having jurisdiction over the decommissioning of the Vallecitos Nuclear Center have been obtained.
IN WITNESS WHEREOF, the undersigned have executed this Certificate in the capacity shown below as of - - - - - - - - - By: _ _ _ _ _ _ _ _ _ _ __ Name:
Title:
Acknowledged by: [*], as Trustee By: _ _ _ _ _ _ _ _ _ _ __ Name:
Title:
1 NTD: Certificate to be signed only by NRC/CA licensee.
EXHIBITB CERTIFICATE OF COMPLETION OF DECOMMISSIONING [*], as Trustee [Address] This Certificate is submitted pursuant to Section 6.02 of the Nuclear Decommissioning Trust Agreement (the "Agreement"), dated [*]between [*] (the "Trustee") and [*] (the "Company"). All capitalized terms used in this Certificate and not otherwise defined herein shall have the meanings assigned to such terms in the Agreement. In your capacity as Trustee, you are hereby authorized and requested to disburse out of the Trust to [Company or other payee] (a) all remaining funds in the Trust, and (b) terminate the Trust. The Company hereby certifies as follows:
- 1. The Company has completed all decommissioning activities at the Vallecitos Nuclear Center, including termination of the NRC Licenses and the Cal DPH License.
- 2. The Vallecitos Nuclear Center has achieved the "End State Conditions" (as defined in that certain Decommissioning Completion Agreement (the "Specified Agreement"), dates as of [*],by and among the Company, GE and GEH.
- 3. There are no disputes outstanding with respect to the achievement of the End State Conditions between the Company, on the one hand, and GE and GEH, on the other hand, and that are no disputes or disputed amounts outstanding under any disbursement certificates that have been submitted by the Company pursuant to Section 2.02 of the Agreement.
{Remainder ofpage intentionally left blank}
IN WITNESS WHEREOF, the undersigned have executed this Certificate in the capacity shown below as of - - - - - - - - NorthStar Vallecitos, LLC By: _ _ _ _ _ _ _ _ _ _ __ Name:
Title:
Acknowledged by: [*], as Trustee By: _ _ _ _ _ _ _ _ _ _ __ Name:
Title:
Confidential Proprietary Information - Withhold from Disclosure Pursuant to JO CFR 2.390 EXHIBIT J CONSOLIDATED FINANCIAL ASSURANCE INSTRUMENTS (Proprietary) Exhibit J
EXHIBITK CONSOLIDATED FINANCIAL ASSURANCE INSTRUMENTS (Redacted) Exhibit K
FINANCIAL SUPPORT AGREEMENT BETWEEN NORTHSTAR GROUP SERVICES, INC. AND This Financial Support Agreement (this "Agreement"), dated as of _____ , 2023 , is made by and between NorthStar Group Services, Inc. , a Delaware corporation ("Parent") and[*], a Delaware limited liability company (the "Subsidiary"). Parent and Subsidiary are referred to individually as a "E.filty" and collectively as the "Parties." WITNESSETH: WHEREAS , Parent is an owner of 100% of the outstanding interests in the Subsidiary; WHEREAS , Subsidiary holds rights, title and interest in the facilities described in Schedule A (the "Vallecitos Nuclear Center") located in Sunol, CA, as well as certain related assets and governmental approvals, including, without limitation, the following licenses from the United States Nuclear Regulatory Commission (the NRC): (a) the NRC Facility Possession-Only License No. TR-1 for the General Electric Test Reactor; (b) the NRC Facility Possession-Only License No. DR-10 for the ESDA Experimental Vallecitos Superheat Reactor; (c) the NRC Facility Operating License No. R-33 for the Nuclear Test Reactor; (d) the NRC Facility Possession-Only License No. DPR-1 for the Vallecitos Boiling Water Reactor; and (e) the NRC Materials License Nos. SNM-960 SNM-1270 for the Vallecitos Nuclear Center ((a) through (e), the "NRC Licenses"); WHEREAS, GE Hitachi Nuclear Energy Americas LLC, a Delaware limited liability company is the licensee subject to the California Department of Public Health ("Cal DPH") Radioactive Materials License 0017-01 (collectively, together with any other amendments to, or consents, orders or approvals from the Cal DPH issued in connection with the foregoing, the "Cal DPH License"); WHEREAS , Parent and Subsidiary desire to take certain actions to assure the Subsidiary's ability to pay the expenses of: (i) maintaining and decommissioning the Vallecitos Nuclear Center safely; and (ii) meeting applicable requirements until (a) the NRC Licenses are terminated, and (b) the Cal DPH License is terminated and site restoration under state-law requirements 1s complete (collectively, the "Decommissioning Costs"); NOW, THEREFORE, in consideration of the mutual promises herein contained and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties hereto agree as follows:
- 1. Availability of Funding; Use of Proceeds. From time to time, upon request of the Subsidiary, Parent shall provide or cause to be provided to the Subsidiary such funds as Subsidiary determines to be necessary to pay the Decommissioning Costs; provided, however, that in any event the aggregate amount which Parent is obligated to provide under this Agreement shall not exceed _ _
- 2. No Guarantee to Third Parties. Without limiting the obligation set forth in paragraph 1, this Agreement is not, and nothing herein contained, and no action taken pursuant hereto by Parent shall be construed as, or deemed to constitute, a direct or indirect guarantee by Parent to any third party (other than the NRC) of the payment of the Decommissioning Costs or of any liability or obligation of any kind or character whatsoever of the Subsidiary. This Agreement may, however, be relied upon by the NRC or Cal DPH as a parental guarantee in determining the financial qualifications of the Subsidiary to hold the NRC Licenses, including funding the costs associated with the completion of decommissioning of the Vallecitos Nuclear Center as well as managing the spent nuclear fuel, high-level waste, and greater than Class-C waste located at the Vallecitos Nuclear Center.
- 3. Waivers. Parent hereby waives any failure or delay on the part of the Subsidiary in asserting or enforcing any of its rights or in making any claims or demands hereunder.
- 4. Amendments and Termination. This Agreement may not be amended or modified at any time without 30 days' prior written notice to the NRC and Cal DPH. This Agreement shall terminate at such time as Parent or any affiliate is no longer a direct or indirect owner of any of the shares or other ownership interests in the Subsidiary. This Agreement shall also terminate with respect to the Decommissioning Costs at such time as the NRC Licenses are terminated for all areas of the Vallecitos Nuclear Center that are subject to such NRC Licenses.
- 5. Successors. This Agreement shall be binding upon the Parties hereto and their respective successors and assigns.
- 6. Third Parties. Except as expressly provided in Sections 2 and 4 with respect to the NRC, this Agreement is not intended for the benefit of any person other than the Parties hereto, and shall not confer or be deemed to confer upon any other such person any benefits, rights, or remedies hereunder.
- 7. Governing Law. This Agreement shall be governed by the laws of the State of California.
- 8. Subsidiary Covenants. The Subsidiary shall take no action to: (a) cause Parent, or its successors and assigns, to void, cancel or otherwise modify the -
support commitment hereunder; (b) cause Parent to fail to perform its commitments hereunder; or (c) impair Parent's performance hereunder, or remove or interfere with the Subsidiary's ability to draw upon Parent's commitment, in each case, without the prior written consent of the NRC ' s Director of the Office of Nuclear Material Safety and Safeguards or Cal DPH. Further, the Subsidiary shall inform
the NRC and Cal DPH in writing any time that the Subsidiary draws upon the - commitment. [SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed and delivered by their respective officers thereunto duly authorized as of the day and year first above written. NORTHSTAR GROUP SERVICES, INC. By: _ _ _ _ _ _ _ _ __ Name:
Title:
By: _ _ _ _ _ _ _ _ __ Name:
Title:
{Signature Page to Financial Support Agreement}
Schedule A Vallecitos Nuclear Center Description Real property in the unincorporated area of the County of Alameda, State of California, described as follows: PARCEL ONE: NEW PARCEL A AS SHOWN ON THAT CERTAIN CERTIFICATE OF COMPLIANCE AND BOUNDARY ADWSTMENT PLN 2016-00118, AS EVIDENCE BY DOCUMENT RECORDED SEPTEMBER 21 , 2016 AS INSTRUMENT NO. 2016241051 OF OFFICIAL RECORDS, MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEING ALL OF THAT CERTAIN PARCEL OF LAND DESCRIBED IN THE CERTIFICATE OF COMPLIANCE, PLN2015-00092, RECORDED MAY 20, 2016, AS DOCUMENT NO. 2016-128982, OFFICIAL RECORDS IN THE OFFICE OF THE RECORDER OF SAID COUNTY OF ALAMEDA; TOGETHER THEREWITH THE FOLLOWING TWO (2) DESCRIBED PARCELS OF LAND: PARCEL 1 BEING A PORTION OF THAT CERTAIN PARCEL OF LAND DESCRIBED IN THE GRANT DEED TO GENERAL ELECTRIC COMPANY RECORDED MARCH 2, 1956, IN BOOK 7953 AT PAGE 525 OF OFFICIAL RECORDS IN THE OFFICE OF THE RECORDER OF SAID COUNTY OF ALAMEDA, MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHEASTERN CORNER OF SAID PARCEL (7953 OR 525); THENCE, FROM SAID POINT OF BEGINNING AND ALONG THE EASTERN LINE OF SAID PARCEL, SOUTH 00° 03' 11" EAST, 2624.98 FEET; THENCE, LEAVING SAID EASTERN LINE SOUTH 89° 57' 13" WEST, 2641.52 FEET TO THE SOUTHEASTERN CORNER OF THAT CERTAIN PARCEL OF LAND DESCRIBED IN THE CERTIFICATE OF COMPLIANCE, PLN 2015-00092, RECORDED MAY 20, 2016, AS DOCUMENT NO. 2016-128982, OFFICIAL RECORDS IN THE OFFICE OF THE RECORDER OF SAID COUNTY OF ALAMEDA; THENCE, FROM SAID SOUTHEASTERN CORNER, ALONG THE EASTERN LINE OF SAID PARCEL (D.N. 2016-128982), NORTH 00° 02' 47" WEST, 2624.68 FEET, TO THE NORTHEASTERN CORNER OF SAID PARCEL (D.N. 2016-128982), SAID CORNER ALSO BEING A POINT ON THE NORTHERN LINE OF SAID PARCEL (7953 OR 525); THENCE, ALONG SAID NORTHERN LINE, NORTH 89° 56' 49" EAST, 2641.21 FEET, TO THE POINT OF BEGINNING; PARCEL 2 BEING A PORTION OF THAT CERTAIN PARCEL OF LAND DESCRIBED IN THE GRANT DEED TO GENERAL ELECTRIC COMPANY RECORDED MARCH 2, 1956, IN BOOK 7953 AT PAGE 525 OF OFFICIAL RECORDS IN THE OFFICE OF THE RECORDER OF SAID COUNTY OF ALAMEDA, MORE PARTICULARLY DESCRIBED AS FOLLOWS:
BEGINNING AT THE NORTHERLY TERMINUS OF THAT CERTAIN COURSE DESCRIBED AS "NORTH 00° 26' 25" WEST, 6958.14 FEET" IN SAID GRANT DEED (7953 OR 525), SAID POINT ALSO BEING THE NORTHEAST CORNER OF LOT K, AS SAID LOT K IS SHOWN AND SO DESIGNATED ON "MAP SHOWING 20 ACRE SUBDIVISIONS OF PLOT NO. 52 OF THE RANCHO EL VALLE DE SAN JOSE" FILED FOR RECORD MAY 14, 1896 IN BOOK 15 OF MAPS ATPAGE49; THENCE, FROM SAID POINT OF BEGINNING, ALONG THE SOUTHERLY LINE OF THAT CERTAIN PARCEL OF LAND DESCRIBED IN THE CERTIFICATE OF COMPLIANCE, PLN 2015-00092, RECORDED MAY 20, 2016, AS DOCUMENT NO. 2016-128982 IN SAID OFFICIAL RECORDS, NORTH 89° 57' 13" EAST, 1398.03 FEET; THENCE, LEAVING SAID SOUTHERLY LINE, SOUTH 00° 26' 25" EAST, 935.61 FEET; THENCE, SOUTH 89° 57' 13" WEST, 1398.03 FEET TO THE WESTERLY LINE OF SAID PARCEL (7953 OR 525), SAID WESTERLY LINE ALSO BEING THE EASTERLY LINE OF ABOVE SAID PLOT NO. 52 (15 M 49); THENCE ALONG SAID LINE, NORTH 00° 26' 25" WEST, 935.61 FEET TO SAID POINT OF BEGINNING. APN: 950-0008-002-02, 950-0008-002-03 , 096-0350-001-08 and 096-0350-001-1 O PARCEL TWO: NEW PARCEL BAS SHOWN ON THAT CERTAIN CERTIFICATE OF COMPLIANCE AND BOUNDARY ADWSTMENT PLN 2016-00118 , AS EVIDENCE BY DOCUMENT RECORDED SEPTEMBER 21 , 2016 AS INSTRUMENT NO. 2016241051 OF OFFICIAL RECORDS, MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEING ALL THAT CERTAIN PARCEL OF LAND DESCRIBED IN THE GRANT DEED TO GENERAL ELECTRIC COMPANY RECORDED MARCH 2, 1956, IN BOOK 7953 AT PAGE 525 OF OFFICIAL RECORDS IN THE OFFICE OF THE RECORDER OF SAID COUNTY OF ALAMEDA. EXCEPTING THEREFROM THE FOLLOWING DESCRIBED PARCEL OF LAND: BEING ALL OF THAT CERTAIN PARCEL OF LAND DESCRIBED IN THE CERTIFICATE OF COMPLIANCE, PLN2015-00092, RECORDED MAY 20, 2016, AS DOCUMENT NO. 2016-128982, OFFICIAL RECORDS IN THE OFFICE OF THE RECORDER OF SAID COUNTY OF ALAMEDA. ALSO EXCEPTING THEREFROM THE FOLLOWING DESCRIBED PARCEL OF LAND: BEING A PORTION OF ABOVE SAID PARCEL OF LAND (7953 or 525), MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHEASTERN CORNER OF SAID PARCEL (7953 OR 525); THENCE, FROM SAID POINT OF BEGINNING AND ALONG THE EASTERN LINE OF SAID PARCEL, SOUTH 00° 03' 11" EAST, 2624.98 FEET; THENCE, LEAVING SAID EASTERN LINE SOUTH 89° 57' 13" WEST, 2641.52 FEET TO THE SOUTHEASTERN CORNER OF THAT CERTAIN PARCEL OF LAND DESCRIBED IN THE CERTIFICATE OF COMPLIANCE, PLN 2015-00092, RECORDED MAY 20, 2016, AS DOCUMENT NO. 2016-128982, OFFICIAL RECORDS IN THE OFFICE OF THE RECORDER OF SAID COUNTY OF ALAMEDA;
THENCE, FROM SAID SOUTHEASTERN CORNER, ALONG THE EASTERN LINE OF SAID PARCEL (D.N. 2016-128982), NORTH 00° 02' 47" WEST, 2624.68 FEET, TO THE NORTHEASTERN CORNER OF SAID PARCEL (D.N. 2016-128982), SAID CORNER ALSO BEING A POINT ON THE NORTHERN LINE OF SAID PARCEL (7953 OR 525); THENCE, ALONG SAID NORTHERN LINE, NORTH 89° 56' 49" EAST, 2641.21 FEET, TO THE POINT OF BEGINNING. ALSO EXCEPTING THEREFROM THE FOLLOWING DESCRIBED PARCEL OF LAND: BEING A PORTION OF THAT CERTAIN PARCEL OF LAND DESCRIBED IN THE GRANT DEED TO GENERAL ELECTRIC COMPANY RECORDED MARCH 2, 1956, IN BOOK 7953 AT PAGE 525 OF OFFICIAL RECORDS IN THE OFFICE OF THE RECORDER OF SAID COUNTY OF ALAMEDA, MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHERLY TERMINUS OF THAT CERTAIN COURSE DESCRIBED AS "NORTH 00° 26' 25" WEST, 6958.14 FEET" IN SAID GRANT DEED (7953 OR 525), SAID POINT ALSO BEING THE NORTHEAST CORNER OF LOT K, AS SAID LOT K IS SHOWN AND SO DESIGNATED ON "MAP SHOWING 20 ACRE SUBDIVISIONS OF PLOT NO. 52 OF THE RANCHO EL VALLE DE SAN JOSE" FILED FOR RECORD MAY 14, 1896 IN BOOK 15 OF MAPS ATPAGE49; THENCE, FROM SAID POINT OF BEGINNING, ALONG THE SOUTHERLY LINE OF THAT CERTAIN PARCEL OF LAND DESCRIBED IN THE CERTIFICATE OF COMPLIANCE, PLN 2015-00092, RECORDED MAY 20, 2016, AS DOCUMENT NO. 2016-128982 IN SAID OFFICIAL RECORDS, NORTH 89° 57' 13" EAST, 1398.03 FEET; THENCE, LEAVING SAID SOUTHERLY LINE, SOUTH 00° 26' 25" EAST, 935.61 FEET; THENCE, SOUTH 89° 57' 13" WEST, 1398.03 FEET TO THE WESTERLY LINE OF SAID PARCEL (7953 OR 525), SAID WESTERLY LINE ALSO BEING THE EASTERLY LINE OF ABOVE SAID PLOT NO. 52 (15 M 49); THENCE ALONG SAID LINE, NORTH 00° 26' 25" WEST, 935.61 FEET TO SAID POINT OF BEGINNING. ALSO EXCEPTING THEREFROM THAT PORTION CONVEYED TO THE COUNTY OF ALAMEDA, A POLITICAL SUBDIVISION OF THE STATE OF CALIFORNIA BY GRANT DEED RECORDED SEPTEMBER 22, 2020 AS INSTRUMENT NO. 2020242258 OF OFFICIAL RECORDS . ALSO EXCEPTING THEREFROM THAT PORTION CONVEYED TO THE STATE OF CALIFORNIA, DEPARTMENT OF TRANSPORTATION BY GRANT DEED RECORDED SEPTEMBER 22, 2020 AS INSTRUMENT NO. 2020242259 OF OFFICIAL RECORDS. APN: 096-0350-001-16 and 096-0350-001-18
EXHIBIT L-1 CONFORMING AMENDMENTS AND LICENSE CONDITIONS MARK-UP Exhibit L-1
UNITED STATES NUCLEAR REGULATORY COMMISSION WASHINGTON, DC 20555 - 0001 DOCKET NO. 50-18 INorthStar Vallecitos, LLC I GE l=f lT/,GHI ~,ucL~R E~jERGY AMERIG.'\S LLG FACILITY LICENSE FOR THE VALLECITOS BOILING WATER REACTOR License No. DPR-1 Amendment No. ~ 1221 This License is amended to read as follows: I....N_o_rt_hS_t_ar_V_a_ll_ec_it_os_,_L_LC _ _.....I I
- 1. This License applies to the nuclear reactor designated by GE Hitachi Nuelear Energy I AlfleFioas LLG, GE l=fi~aohi) as the "Vallecitos Boiling Water Reactor" (hereinafter I referred to as "the facility") which is owned by
- i and located in its Vallecitos I Atomic Laboratory at Alameda County, California, a which Construction Permit No. CPPR-3 was issued by the Commission on May 14, 19 Northstar Vallecitos, LLC
- 2. The Commission has found that:
- a. The application for amendment complies with the requirements of the Atomic Energy Act of 1954, as amended, and the Commission's regulations set forth in Title 10, Chapter 1, CFR;
- b. The issuance of the amendment will not be inimical to the common defense and security or to the health and safety of the public;
- c. Prior public notice of proposed issuance of this amendment is not required since the amendment does not involve significant hazards considerations different from those previously evaluated; and
- d. There is reasonable assurance that the reactor can be possessed at the designated location without endangering the health and safety of the public.
- 3. Subject to the conditions and requirements incorporated herein, the Commission hereby licenses GE Hi~aehi: INorthStar Vallecitos , LLC I
- a. Pursuant to Section 104b of the Act and Title 10, CFR, Chapter 1, Part 50, "Licensing of Production and Utilization Facilities," to possess, but not to operate, the facility in the condition described in the Final Report on Deactivation of Vallecitos Boiling Water Reactor dated February 5, 1965.
- b. Pursuant to the Act and Title 10, CFR, Chapter 1, Part 30, "Licensing of Byproduct Material," to possess, but not to separate, such byproduct material as may be contained in the structural arts of the facility.
Northstar Vallecitos, LLC
- 4. Pursuant to the Act and Title , , Chapter 1, Part 20, "Standards for Protection Against Radiation," GE l=litaehi is exempted from the requirements of Section 20.203 (C) (2) for a visible or audible control device in high radiation areas of the VBWR provided that an audible control device is maintained on the doors to the containment building.
- 5. This License shall be deemed to contain and be subject to all applicable provisions of the Act and rules, regulations and orders of the Commission now or hereafter in effect; and is sub*ect to the additional conditions specified or incorporated below:
Northstar Vallecitos. LLC
- a. GE 19iiaehi chall not reactivate the facility without prior approval of the Commission.
!Northstar Vallecitos. LLC I
- b. GE Hitachi shall not dispose of the facility or the property occupied by the I facility without prior approval of the Commission, except that GE Hitaehi may I dispose of any component parts or devices from the VBWR facility in ~ -
accordance with the provisions of 10 CFR Part 20. "'-
!Northstar Vallecitos . LLC I
- c. Records In addition to those required by applicable AEC regulations, including section 20.401 of 10 CFR 20, GE l=litaehi shall keep the following records:
!Northstar Vallecitos. LLC I (1) Records of annual inspections of the deactivated facility, including the results of surveys of radioactivity levels.
(2) Records showing radioactivity released or discharged into the air or water beyond the effective control of GE Hiteehi as measured at the point of such release or discharge. !Northstar Vallecitos. LLC I
- d. Reports
!Northstar Vallecitos. LLC I In addition to those required by applicable AEC regulations, GE Hitaehi shall submit the following reports:
Northstar Vallecitos . LLC (1 ) A report of any indication or occurrence of a possible unsafe condition relating to the facility or to the public. For each occurrence, GE Hitaeh1 shall promptly notify by telephone or telegraph the Director of the appropriate AEC Regional Compliance Office listed in appendix D of 10 CFR 20 and shall submit within 10 days a report in writing to the Director, Division of Reactor Licensing, with a copy to the Regional Compliance Office. (2) A report of the status of the deactivated facility, including the results of the surveys of radioactivity levels shall be submitted annually. The report shall be submitted no later than 180 days after each annual Ins ection is com leted. September 1, 2023 Northstar Vallecitos. LLC
- e. GE Hitaehi Nuelear Energy Amcrieas LLG, as sial.Qt'lr11n the General Eleetrie I Company's (GE's) application dated January 19, 2007, and supplemented on t January 25, 2007, February 2:3, 2007, Mareh 2, 2007, Mareh 26, 2007, May 16, t 2007, May 18, 2007, June 4, 2007, duly 6, 2007, and August Q, 2007, will abide l by all commitments and representations previously made by GE with respect to I the license. These include, but are not limited to, maintaining d~ missioning I..
records, implementing decontamination activities, and eventually ~ [ decommissioning the facility. !GE-Hitachi Nuclear Energy Americas , LLC I
~ .
!Northstar Vallecitos. LLC I
- f. The Manager of the llecitos Nuclear Center, the Vice-President, Reactor Facility Safety and Sec
- of GE l=litaohi Nuolear Energy AmeFieas LLG , and the Manager of GE l-4itach1 ~luclear Energy Amerioas LLG, shall be US citizens.
These individuals shall have the responsibility and exclusive authority to ensure and shall ensure, that the business and activities of GE l=litaehi Nuolcar Energy !Northstar Vallecitos. LLC I Americas LLG , with respect to this License, are at all times conducted in a manner consistent with the protection of the public health and safety and the common defense and security.
- g. The commitments/representations made in the GcneFOI Electric Company's
~ application dated January 19, 2007, and supplemented on January 25, 2007, February 23, 2007, March 2, 2007, March 26, 2007, May 16, 2007, May 18, 2007, June 4, 2007, July 6, 2007, and August 9, 2007, regarding reporting relationships and authority over safety and security issues and compliance with NRC requirements shall be adhered to and not be modified without the prior written consent from the Director, Office of Federal and State Materials and Environmental Management Programs, or designee.
!Northstar Vallecitos. LLC I
- h. GE Hitachi Nuclear 6nergy Americas LLG, shall cause to be transmitted to the Director, Office of Federal and State Materials and Environmental Management Programs within 30 days offiling with the U.S. Securities Exchange Commission (SEC), any schedule 13D or 13G filed pursuant to the Securities Exchange Act of 1934 that discloses beneficial ownership of a re istered class of General Electric stock. any of its publicly traded parent companies' I
I. Prior to completion of transfer of the license, GE Hitaohi Nuolear Energy I
!Northstar Vallecitos. LLC I Americas LLG , shall provide the Nuclear Regulatory Commission staff I satisfactory documentary evidence of a parent company guarantee or another I method authorized by and meeting the requirements of 10 CFR 50.75 for I decommissioning funding assurance in an amount no less than $8,016,000 for I theVBWR. I
- 6. This License is effective as of its date of issuance and shall expire on May 14, 1996.1 1
In a letter from Michael T. Masnik (NRG) to G. L. Stimmel (GE VNC Site Manager) dated November 3, 1997, the NRG quoted 10 CFR 50.51(b), stating that "Each License for a facility that has permanently ceased operations, continues in effect beyond the expiration date to authorize ownership and possession of the production or utilization facility, until the Commission notifies the licensee in writing that the License is terminated." They further stated that "your decommissioning schedule will determine the expiration date for your [possess only reactor] Licenses."
UNll"ED STATES NUCLEAR REGULATORY COMMISSION WASHINGTON, DC 20555
- 0001 INorthStar Vallecitos, LLCI DOCKET NO. 50-183 GE HITACHI NUCLEAR ENERGY AMERICAS LLC FACILITY LICENSE FOR ~ EXPERIMENTAL VALLECITOS SUPERHEATREACTOR
!ESADA!
License DR-10 ITT Amendment No. e i..-,i This License is amended as follows: . - - - - - - - - - - - - . ESADA Vallecitos INorthStar Vallecitos , LLCI Experimental Superheat
- 1. This License applies to the heterogeneous, light water moderated, steam cooled, ....R_e_ac_to_r_ _ _ _ _____.
superheat reactor owned by GE Hitachi Nuolear Energy Americas LLC, hereinafter~ l-litashi," and designed as the eSQA ~cperiFRantal Vallecitas SuJ;JaFheat Roaster (hereinafter "EVESR"). The facility is located at GE Hitachi's lecitos Nuclear Center, Alameda County, California, and is described in the application da ctober 5, 1962, and amendments thereto including Amendment No. 14 dated October 12, 19 , mendment No. 15 dated December 20, 1967, Modification No. 1 to Amendment No. 15 date arch 20, 1968, Amendment No. 16 dated October 16, 1969, and Modification No. 1 to Amendment No.16 dated March 9, 1970 (hereinafter "the application"). .-IN_o_rt-hS-t-ar_V_a_lle-c-it-os-,-L-LC-,-.sl
- 2. Subject to the conditions and requirements incorporated herein, The Commission hereby licenses GE l-litaehi: INorthStar Vallecitos, LLCI A. Pursuant to section 104b of the Act and 10 CFR Part 50, to possess, but not to operate, the reactor as a utilization facility, as described in the application .
- 8. Pursuant to the Act and 10 CFR Part 30, to possess, but not to separate, such byproduct material as may be contained in the component parts of the facility.
- 3. This License shall be deemed to contain and be subject to the conditions specified in Part 20, Section 30.34 of Part 30, and Sections 50.54 and 50.59 of Part 50, Title 10, Chapter 1, CFR, and to all applicable provisions of the Act and to the rules, regulations and orders of the Commission now or hereafter in effect, and to the additional conditions s ecified below:
Northstar Vallecitos, LLC A. GE Hitashi shall not reactivate the facility nor use the reactor pressure vessel or any system which is open to the reactor pressure vessel without prior approval of the Commission. B. Technical Specifications The Technical Specifications contained in Appendix A, as revised through Amendment No. 4, are hereby incorporated in the License. The licensee shall operate the facil.ity in accordance with the Technical Specifications. No changes shall be made in the Technical Specifications, except as otherwise permitted by this License, the Act, and the Commission's rules and regulations. INorthStar Vallecitos, LLCI C. GE Hitaehi shall not dispose of the facility or the property occupied by the facility without prior approval of the Commission, except that GE Hitaehi may dispose of component parts or devices from the EVESR facility in accordance with the provisions of 10 CFR Part 20 INorthStar Vallecitos, LLCI
D. Records In addition to the records heretofore required under this License and by applicable AEC regulations, including section 20.401 of 10 CFR Part 20, GE Hitachi shall keep the following: INorthStar Vallecitos, LLCI
- 1. Records of inspections of the deactivated facility, including the results of surveys of radioactivity levels.
- 2. Records showing radioactivity released or discharged into the air or water beyond the effective control of GE l=litaohi as measured at the point of such release or discharge.
!Northstar Vallecitos, LLCI E. Reports INorthStar Vallecitos, LLCI In addition to those reports required by applicable AEC regulations, GE Hitachi shall submit the following:
Northstar Vallecitos, LLC
- 1. A report of any indication or occurrence o a possI e unsa e condition relating to the facility or to the public. For each occurrence, GE Hitachi shall promptly notify by telephone or telegraph the Director of the appropriate AEC Regional Compliance Office listed in Appendix D of 10 CFR Part 20. And shall submit within 1O days a report in writing to the Director, Division of Reactor Licensing, with a copy to the Regional Compliance Office.
- 2. An annual report of the status of the deactivated facility including the results of the surveys of radioactivity levels shall be submitted to the Commission. The average interval between annual reports shall be one year and may extend, on occasion, up to 15 months for a valid reason.
bNorthStar Vallecitos, LLCI F. GEitachi Nuslear Energy Americas LLG, as stated in the Generol Eleetrie Goffipany's I (GE's) application dated January 19, 2007, and suppleffiented en January 25, 200~ I i;:sbruary 23 , 2007, March 2, 2007, March 26, 2007, May 16, 2007, May 18, 2007, jseptemb~r 1 , 2023 1 June 4, 2007, July 6, 2007, and August 9, 2007, will abide by all commitments and I representations previously made by GE *th respect to the license. These include, but I are not limited to, maintaining decommiss1omn"""",,,.,..r,ds, imRlementin decontamination activities, and eventually decommissioning the facility. GE-Hitachi Nuclear Enerqy Americas, LLC Northstar Vallecitos, LLC G. The Manager of the Vallecitos Nuc ear en er, e ice- resident, Reactor Facility Safety and Security of GE Hitachi Nuclear Energy /\merieas LLG, and the Manager of GE Hitachi Nuclear Energy Amerisas LLG , shall be US citizens. These individuals shall have the respo ibility and exclusive authority to ensure and shall ensure, that the business and ac *vities of GE Hitaehi ~duelear Energy Affiericas LLG , with respect to this License, are at al imes conduc in a manner consistent with the protection of the public health ands fety and e common defense and security. Northstar Vallecitos, LLC
H. The commitments/representations made in the General Electric Company's (GE's) application dated January 19, 2007, and supplemented on January 25. 2007, February 23, 2007, March 2, 2007, March 26, 2007, May 16, 2007, May 18, 2007, June 4, 2007, July 6, 2007, and August 9, 2007, regarding reporting relationships and authority over safety and security issues and compliance with NRC requirements shall be adhered to and not be modified without the prior written consent from the Director, Office of Federal and State Materials and Environmental Management Programs, or designee. any of its publicly traded parent companies' N-o-rt-hS.,....t-ar...,.V...,.a"""'11-ec...,.it-os-,...,.L..,...L..,,.,C!
.-1 I. GE Hitachi Mucloar Energy Americas LLG, shall cause to be trans
- ed to the Director, Office of Federal and State Materials and Environmental Mana ment Programs within 30 days of filing with the U.S. Securities Exchange Commi on (SEC), any schedule 13D or 13G filed pursuant to the Securities Exchange of 1934 that discloses beneficial ownership of a registered class of General Eleetrie stock.
-IN_o_rt-hS-t-ar_V_a_ll_ec-it-os-,-L-LC....,I J. Prior to completion of transfer of the license, GE Hitaehi ~~uelcar Energy Americas LLG, shall provide the Nuclear Regulatory Commission staff satisfactory documentary evidence of a parent company guarantee or another method authorized by and meeting the requirements of 10 CFR 50.75 for decommissioning funding assurance ift an amount no less than $10,516,000 for the EVESR .
This License, as amended, is effective as of the date of issuance and shall expire at midnight, January 26, 2016. FOR THE ATOMIC ENERGY COMMISSION RIA Peter A. Morris, Director Division of Reactor Licensing Date of Issuance: June 17, 1968
authority to maintain the facility in a safe and secure condition at all times . The facility manager shall have extensive reactor knowledge and shall utilize the resources of other licensee personnel as necessary to provide an effective safety program. 2, Review and Audit (a) Written procedures for control of access to the plant area, use of the plant area facilities and equipment and for periodic inspection of the facility shall be established and approved by the manager to whom the facility supervisor reports . (b) Written procedures specified in 2.(a) above shall be reviewed by technically qualified personnel responsible to a management position other than the facility supervisor (the Nuclear Safety group) in accordance with a written charter for that function. (c) The Nuclear Safety group shall periodically audit activities conducted in the plant area to verify that effective radiological control practices are maintained. C. HEALTH AND SAFETY A. Radiation Monitoring Radiation monitoring instruments shall be available as appropriate to prevent exposure of personnel to radiation in accordance with the standards Appendix A Page2
UNITED STATES NUCLEAR REGULATORY COMMISSION WASHINGTON , DC 20555 - 0001 DOCKET NO. 50-70 INorthStar Vallecitos , LLC I Ge l=I ITl'.Gl=I I ~JUGLe/\R e~JeRGY /\MeRIG/\£ LLG FACILITY LICENSE FOR GENERAL ELECTRIC TEST REACTOR License No. TR-1 Amendment No. 47-This License is amended as follows: ~
- 1. The Nuclear Regulatory Commission (the Commission) has found that:
A. The application for renewal of facility License No. TR-1 filed by the General Electric Company* dated July 9, 1990, as supplemented on December 17, 1990, and August 7, 1992, complies with the standards and requirements of the Atomic Energy Act of 1954, as amended (the Act), and the Commission's regulations as set forth in 10 CFR Chapter I; B. Construction of the facility was completed in substantial conformity with Construction Permit No. CPTR TR-2 dated January 7, 1959, the provisions of the Act, and the regulations of the Commission; C. The facility will be maintained in conformity with the application, the provisions of the Act, and the regulations of the Commission; D. There is reasonable assurance; (i) that the activities authorized by this License can be conducted without endangering the health and safety of the public, and (ii) that such activities will be conducted in compliance with the Commission's regulations; E. The licensee is technically and financially qualified to engage in the activities authorized by this License in accordance with the regulations of the Commission; F. The licensee has satisfied the applicable provisions of 10 CFR Part 140, "Financial Protection Requirements and Indemnity Agreements," of the Commission's regulations; G. The issuance of this License will not be inimical to the common defense and security or to the health and safety of the public; H. The issuance of this License is in accordance with 10 CFR Part 51 of the Commission's regulations and all applicable requirements have been satisfied; and I. The possession of the byproduct materials as authorized by this License will be in accordance with the Commission's regulations in 10 CFR Part 30, including Section 30.33.
- This License was transferred from the General e leotrio Gon=ipany to GE-Hitachi Nuclear Energy Americas LLC, in accordance with the Order for this Amendment.
' i t o Northstar Vallecitos, LLC I
- 2. Accordingly, Facility License No. TR-1 is hereby amended to read as follows: Ito Northstar Vallecitos , LLC I A. This amended License applies to the nuclear test r0 " ' '. , _--,
is owned by ~!--be-l=l+H~~ltleelea~:-Re~f-A~ ~as--bl:::b, and located at the Vallecitos Nuclear Center in Alameda County, California, as described in the application for License renewal dated July 9, 1990, as supplemented on December 17, 1990, and August 7, 1992. B. Subject to the conditions and requirements incorporated herein, the Commission hereby licenses the Ge l=litashi ~h,1Glear energy /\n:ierisas LLG: INorthStar Vallecitos , LLC I (1) Pursuant to Section 104c of the Act and 10 CFR Part 50, "Domestic Licensing of Production and Utilization Facilities," to possess, but not operate, the reactor at the designated location at the Vallecitos Nuclear Center, in accordance with the procedures and limitations described in the application and in this License. (2) Pursuant to the Act and 10 CFR Part 30, "Rules of General Applicability to Domestic Licensing of Byproduct Material," to possess, but not to separate, such byproduct material as may have been produced by operation of the reactor. C. This License shall be deemed to contain and is subject to the conditions specified in Parts 20, 30, 50 and 51 of 10 CFR Chapter 1, to all applicable provisions of the Act, and to the rules, regulations and orders of the Commission now or hereafter in effect and to the additional conditions specified below: (1) Operation The licensee shall not operate the reactor nor install fuel or fueled experiments within the reactor core or core area. (2) Technical Specifications The Technical Specifications contained in Appendix A, as revised through Amendment No. 17, are hereby incorporated in the License. The licensee shall possess and maintain the facility in accordance wit~ ibe Iecboical Sor rifications. Northstar Vallecitos , LLC tSeptember 1, 2023 _ (3)
- stated in the General elestris t Company's (Ge 's) application dated , , t January 25 , 2007, P:ebruary 2a, 2007, Marsh 2, 2007, Marsh 26 , 2007, May 16, 2007, t May 18, 2007, June 4, 2007, July 6, 2007, and August Q, 2007, will abide by all I commitments and representations previously made by Ge *th respect to the license. I These include, but are not limited to, maintaining decommissionincrr~ms. I implementing decontamination activities, and eventually decommissionin the a * * .
GE-Hitachi Nuclear Energy Americas LLC (4) The Manager of the Vallecitos Nuclear Center, the Vice-President, Reactor Facility Safety and Security of * * * , and the Manager of Ge l=litashi ~Juslear energy /\n:ierisas LLG , shall b US citizens. These individuals Northstar Vallecitos, LLC
!Northstar Vallecitos, LLC I shall have the responsibility and exclusive authority to ensure and shall ensure, that the business and activities of SE-I litacl,i tfoclea, E11e1gy A11 1elicas LLC , with respect to this License, are at all times conducted in a manner consistent with the protection of the public health and safety and the common defense and security.
(5) The commitments/representations made in the General Electric Company's (GE's) application dated January 19, 2007, and supplemented on January 25, 2007, February 23, 2007, March 2, 2007, March 26, 2007, May 16, 2007, May 18, 2007, June 4, 2007, July 6, 2007, and August 9, 2007, regarding reporting relationships and authority over safety and security issues and compliance with NRC requirements shall be adhered to and not be modified without the prior written consent from the Director, Office of Federal and State Materials and Environmental Management Programs, or designee.
!Northstar Vallecitos, LLC I any of its publicly traded parent companies' (6) SE-I litacl,i tfoclea, E11e1gy A11 1elicas LLC , shall cause to be transmitted tot Director, Office of Federal and State Materials and Environmental Manage Programs within 30 days of filing with the U.S. Securities Exchange Co ission (SEC),
any schedule 13D or 13G filed pursuant to the Securities Excha ct of 1934 that discloses beneficial ownership of a registered class of -R,,orn,,,r,i-:=rt-~rrlrlrr-NorthStar Vallecitos, LLC (7) Prior to completion of transfer of the license, SE-I litacl ,i tfocl ea, E, IeI gy A, 11e1 icas tte, shall provide the Nuclear Regulatory Commission staff satisfactory documentary I evidence of a parent company guarantee or another method authorized by and meeting I the requirements of 10 CFR 50. 75 for decommissioning funding assurance tn-an t a11 IomIl 110 less tl 1a11 $14 ,077,000 fur the GETR. I
- 3. This License amendment is effective as of its date of issuance and shall expire at midnight, January 26, 2016.
FOR THE NUCLEAR REGULATORY COMMISSION RIA Bruce A. Boger, Director Division of Reactor P:rojects - 11I/IV/V Office of Nuclear Reactor Regulation Date of Issuance: September 30, 1992
OFFICIAL USE ONLY SECURITY RELATED INFORMATION NRC FORM 374 Page 1 of 6 U.S. NUCLEAR REGULATORY COMMISSION MATERIALS LICENSE Pursuant to the Atomic Energy Act of 1954, as amended, the Energy Reorganization Act of 1974 (Public Law 93-438) , and Title 10, Code of Federal Regulations, Chapter I, Parts 11 , 30 , 31 , 32, 33, 34 , 35, 36 , 39, 40 , 70 , 73, and 74 and in reliance on statements and representations heretofore made by the licensee, a license is hereby issued authorizing the licensee to receive, acquire, possess, and transfer byproduct, source, and special nuclear material designated below; to use such material for the purpose(s) and at the place(s) designated below; to deliver or transfer such material to persons authorized to receive it in accordance with the regulations of the applicable Part(s). This license shall be deemed to contain the conditions specified in Section 183 of the Atomic Energy Act of 1954, as amended , and is subject to all applicable rules, regulations, and orders of the U.S . Nuclear Regulatory Commission now or hereafter in effect and to any conditions specified below. Licensee INorthStar Vallecitos , LLC I
- 1. GE: Hitaehi ~Juelear E:nerg;<< l',n=ierieas, LLG 3. License Number: SNM-960, Amendment 2
- 2. 6705 Vallecitos Road
- 4. Expiration Date: August 9, 2027 Sunol, California 94586 5. Docket No. 70-754
- 6. Source, Special Nuclear 7. Chemical and/or Physical 8. Maximum amount that Material, By-product Material Form Licensee May Possess at Any One Time Under This License A. Uranium enriched to less A. Solid form; unirradiated A. [Security-Related than 5 percent 235 U or mixed oxide fuel; Information - Withheld irradiated with its attendant Under 10 CFR 2.390]
byproduct and reactor-produced transuranics B. Uranium enriched from B. Solid form; unirradiated B. [Security-Related 5 percent to less than or mixed oxide fuel; Information - Withheld 20 percent 235 U irradiated with its attendant Under 10 CFR 2.390] byproduct and reactor-C. Uranium enriched to zj produced transuranics C. Solid form; unirradiated C. [Security-Related greater than 80 or mixed oxide fuel; Information - Withheld percent 235 U irradiated with its attendant Under 10 CFR 2.390] byproduct and reactor-produced transuranics D. Plutonium D. Solid form D. [Security-Related Information - Withheld Under 10 CFR 2.390] E. Special Nuclear Material E. In any form. E. [Security-Related Information - Withheld Under 10 CFR 2.390] Enclosure 1 OFFICIAL USE ONLY SECURITY RELATED INFORMATION
OFFICIAL USE ONLY SECURITY RELATED INFORMATION NRC FORM 374A U.S. NUCLEAR REGULATORY COMMISSION Page 2 of 6 License Number SNM-960 , Amendment 2 MATERIALS LICENSE Docket or Reference Number SUPPLEMENTARY SHEET 70-754
- 9. Authorized use: R REG(/
a) 6A through 60: for storage only I.. b) 6E: in process or storage for lab analysis/engineering studies or in radioactive waste
- 10. Authorized Place of Use: The licensee's facilities in the Vallecitos Nuclear Center located near Pleasanton, California, as described in Section 1.1.1 of GE-Hitachi Nuclear Energy Americas, LLC's, March 18, 2015, license renewal application and revision dated February 26, 2016.
- 11. The licensee shall conduct authorized activities at the Vallecitos Nuclear Center located near Pleasanton, California, in accordance with the statements, representations, and conditions in its March 18, 2015, license renewal application and revision dated February 26, 2016.
- 12. This license shall be deemed to contain three sections: Safety Conditions, Safeguards Conditions, and Transportation Conditions. All these sections are part of the license, and the licensee is subject to compliance with all listed conditions in each section.
- 13. The licensee is hereby granted the special authorizations and exemptions identified in Section 1.3 of the license renewal application dated February 26, 2016.
- 14. At intervals not to exceed 3 years from its approval by the U.S. Nuclear Regulatory Commission (NRC), the licensee shall update the Decommissioning Funding Plan and provide it to the NRC for review and approval. After resolution of any NRC comments, the licensee shall submit final executed copies of the financial assurance instruments to the NRC.
FOR THE U.S. NUCLEAR REGULATORY COMMISSION DigitallysignedbyJacobl. Jacob I. Zimmerman Zimmerman ~~~~~022.04_2014:40:29 Date: April 20, 2022 By:----------- Jacob I. Zimmerman, Chief Fuel Facility Licensing Branch Division of Fuel Management Office of Nuclear Material Safety and Safeguards OFFICIAL USE ONLY SECURITY RELATED INFORMATION
OFFICIAL USE ONLY SECURITY RELATED INFORMATION NRC FORM 374A U.S. NUCLEAR REGULATORY COMMISSION Page 3 of 6 License Number SNM-960, Amendment 2 MATERIALS LICENSE Docket or Reference Number SUPPLEMENTARY SHEET 70-754 SAFETY CONDITIONS S-1. The licensee shall conduct activities at the Vallecitos Nuclear Center in accordance with statements, representations and conditions as described in the following documents:
!transfer I !September 1, 2023 I
- a. License Fenewal application dated MaFGh 18, 201 a, and its subsequent revision dated February 26, 2016.
- b. Decommissioning Funding Plan (DFP) dated January 31, 2014; DFP Supplemental Information dated August 1, 2014; revised DFP dated February 7, 2017; and updated DFP dated March 6, 2020, as supplemented by letters dated June 2, 2020, January 12, 2022, January 24, 2022, electronic communication dated March 2, 2021, and the March 30, 2022, DFP revision.
S-2. Sealed Plutonium sources shall be subject to the leak testing and actions specified in the attached "License Condition for Leak Testing Sealed Plutonium Sources," dated April 1993. S-3. Release of equipment or materials for unrestricted use shall be in accordance with the attached "Guidelines for Decontamination of Facilities and Equipment Prior to Release for Unrestricted Use or Termination of Licenses for Byproduct, Source, or Special Nuclear Material," April 1993. S-4. The licensee shall provide to the Commission copies of its annual report summarizing the effluent monitoring and environmental surveillance programs at the Vallecitos Nuclear Center. This report shall be sent to the Division of Fuel Cycle Safety, Safeguards, and Environmental Review; Office of Nuclear Material Safety and Safeguards; U.S. Nuclear Regulatory Commission, Washington, DC 20555, and the NRC Regional Office-Region IV at the address specified in Appendix D of Title 10 of the Code of Federal Regulations (10 CFR) Part 20. S-5. Exemptions to the requirements of 10 CFR Section 70.24, "Criticality Accident Requirements," are hereby granted according to 10 CFR Paragraph 70.24(d). The exemptions are granted in accordance with Section 1.3.2, "Exemptions to Criticality Monitoring System Requirements," of the February 26, 2016, license renewal application as follows: OFFICIAL USE ONLY SECURITY RELATED INFORMATION
OFFICIAL USE ONLY SECURITY RELATED INFORMATION NRC FORM 374A U.S. NUCLEAR REGULATORY COMMISSION Page 4 of 6 License Number SNM-960, Amendment 2 MATERIALS LICENSE Docket or Reference Number SUPPLEMENTARY SHEET 70-754 The following areas are exempted from monitor alarm requirements:
- a. Areas where special nuclear material (SNM) is stored in locations within the United States provided that the SNM is fully packaged as for transport in containers meeting all of the general license requirements of 10 CFR Part 71 or in containers owned by
- and certified for transport under the provisions of 10 CFR Part 71 in accordance with the conditions of a Certificate of Compliance authorizing deliv ry of such containers to a carrier for INorthStar Vallecitos , LLC I Fissile Class I transport,
- b. Individual areas where there is negligible risk of criticality due to the amount or configuration of fissile material. In these areas, an evaluation has determined the risk of criticality is very low such that no credible accident sequence can be identified that results in criticality.
S-6. The licensee is hereby authorized to release radioactive materials in accordance with the Enclosure to this license.
Enclosure:
Guidelines for Decontamination of Facilities and Equipment Prior to Release for Unrestricted Use or Termination of Licenses for Byproduct, Source, or Special Nuclear Material (April 1993) OFFICIAL USE ONLY SECURITY RELATED INFORMATION
OFFICIAL USE ONLY SECURITY RELATED INFORMATION NRC FORM 374A U.S. NUCLEAR REGULATORY COMMISSION Page 5 of 6 License Number SNM-960 , Amendment 2 MATERIALS LICENSE Docket or Reference Number SUPPLEMENTARY SHEET 70-754 SAFEGUARDS CONDITIONS SG-1.0 PHYSICAL PROTECTION REQUIREMENTS SG-1.1: The licensee is authorized to possess or use SNM at the Vallecitos Nuclear Center, in accordance with the Physical Security Plan dated March 21, 2016, as approved by the Commission and as it may be further revised in accordance with the provisions of 10 CFR 70.32(e). The licensee shall maintain and follow the Physical Security Plan in accordance with Confirmatory Order EA-14-144, dated April 22, 2015. SG-2.0 FACILITY OPERATION SG-2.1: Notwithstanding those sections within 10 CFR Parts 70 and 74 which establish requirements for licensees authorized to possess unirradiated SNM in quantities exceeding one effective kilogram, the licensee may follow the applicable requirements of 10 CFR Part 74 as though only authorized to possess less than one effective kilogram of SNM, provided that the licensee does not possess at any one time unirradiated SNM in quantity equal to or greater than one effective kilogram. SG-2.2: A Fundamental Nuclear Material Control Plan which addresses the material control and accounting requirements of 10 CFR 74.31, 74.41, 74.43, 74.45, 74.51, 74.53, 74.55, 74.57, and 74.59, as appropriate, shall be submitted to and approved by the NRC prior to increasing the actual holdings of unirradiated SNM under License SNM-960 beyond one effective kilogram. SG-2.3: The licensee shall maintain and follow its Material Control and Accounting (MC&A) Program Description for GE-Hitachi Nuclear Energy Americas, LLC, Vallecitos Nuclear Center, Revision 0, dated June 17, 2015, in accordance with Confirmatory Order EA-14-144 dated April 22, 2015. Changes to the MC&A Program Description shall be submitted to the Commission for review and approval prior to implementation. OFFICIAL USE ONLY SECURITY RELATED INFORMATION
OFFICIAL USE ONLY SECURITY RELATED INFORMATION NRC FORM 374A U.S. NUCLEAR REGULATORY COMMISSION Page 6 of 6 License Number SNM-960, Amendment 2 MATERIALS LICENSE Docket or Reference Number SUPPLEMENTARY SHEET 70-754 I.. TRANSPORTATION CONDITIONS T-1.0 TRANSPORTATION SECURITY T-1.1: The licensee shall not import, export, transport in a single shipment, or take delivery of a single shipment free on board at the point where it is delivered to an agent or carrier, quantities of SNM as specified in 10 CFR 73.1 (b)(2) until a detailed plan as described in 10 CFR 70.22(g) has been submitted and approved by the NRC. OFFICIAL USE ONLY SECURITY RELATED INFORMATION
EXHIBIT L-2 CONFORMING AMENDMENTS AND LICENSE CONDITIONS CLEAN Exhibit L-2}}