Subcontract Agreement, dated October 31, 2018, by and between the Registrant and Commonwealth Edison Company

This Subcontract Agreement No. 08900001-007 (the "Agreement") dated October 31, 2018 by and between American Superconductor Corporation, a Delaware corporation with offices at 114 East Main Street, Ayer, MA 01432 ("AMSC") and Commonwealth Edison, an Illinois corporation with offices at 440 South LaSalle, Chicago, IL 60605 ("Subcontractor"), and shall become effective as of the Effective Date (as defined below). AMSC and Subcontractor may be referred herein separately as a “Party” and collectively as the "Parties."

WHEREAS, the U.S. Department of Homeland Security (“DHS”) awarded that certain Other Transaction Agreement number HSHQDC-08-9-00001 (“the Prime Contract” and upon execution of the DHS Amendment (as defined below), the term “Prime Contract” shall mean the Prime Contract as amended by the DHS Amendment) to AMSC to develop, design and deploy an inherently fault current limiting high temperature superconductor (“HTS”) electric cable system;

WHEREAS, AMSC and Subcontractor desire to work together to complete Phase 2 (as that term is defined in the Prime Contract as in effect on the date hereof) (the “Project”);

WHEREAS, AMSC has submitted to DHS a proposed form of amendment to the Prime Contract which authorizes the substitution of Subcontractor for Consolidated Edison for performance of the Project, and contains all DHS necessary consents or authorizations for Subcontractor to perform the Project, which amendment is attached hereto as Appendix G (the “Proposed DHS Amendment”);

WHEREAS, DHS shall deliver a signed amendment to the Prime Contract which authorizes the substitution of Subcontractor for Consolidated Edison for performance of the Project, and contains all DHS necessary consents or authorizations for Subcontractor to perform the Project to AMSC for its signature (the “DHS Amendment”);

WHEREAS, this Agreement shall become effective on the date on which AMSC and DHS have signed the DHS Amendment (the “Effective Date”);

WHEREAS, until the Effective Date, this Agreement shall not be deemed to create any obligation by either Party to the other Party, or require any Party to perform any obligation with respect to the tasks described in the Prime Contract, except as expressly set forth herein; and

WHEREAS, notwithstanding the foregoing, the Parties shall be bound by the Non-Disclosure Agreement signed by the Parties on October 31, 2018 (the “NDA”).

NOW, THEREFORE, in consideration of the terms and covenants of this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby mutually acknowledged by the Parties, the Parties agree, effective as of the Effective Date, as follows:

1.1.    Scope. AMSC and Subcontractor acknowledge and agree that this Agreement sets forth the duties and obligations of the Parties for the Project as is described in the Statement of Work attached hereto as Appendix A (the “Statement of Work” or “Appendix A”).

1.2.    Performance by Subcontractor. Subcontractor shall (i) perform those tasks to be performed by it as described in the Statement of Work in accordance with the terms of this Agreement, (ii) cause its subcontractors to perform any tasks in order to achieve the milestones set forth in Section 3.2 below

(“Milestones”) that are indicated as Subcontractor’s responsibility, and perform its responsibilities in accordance with this Agreement and the appendices attached hereto (“Appendices”), including by meeting all Milestones that are Subcontractor’s responsibility; and (iii) cooperate with and provide reasonable support to AMSC in connection with AMSC’s performance of its obligations under this Agreement and the Prime Contract (collectively (i) through (iii) are referred to as the “Subcontractor Work”). Subcontractor represents and warrants that it has the legal right to perform the Subcontractor Work. Subcontractor shall provide Subcontractor personnel and subcontractors that have the necessary skills and experience to perform the Subcontractor Work. Subcontractor shall assign the Subcontractor Work to those of its personnel or outside contractors, as it shall determine, who have the necessary skills and experience. Subcontractor shall cause the Subcontractor Work to be performed in a professional and workmanlike manner, and Subcontractor shall use commercially reasonable efforts to cause the Subcontractor Work to be performed in a timely manner.

1.3.    Performance by AMSC and its Other Subcontractors. AMSC shall: (i) in accordance with its role as prime contractor for the Project, perform overall Project management; however, under no circumstances will AMSC have control over the manner or methods, including without limitation the processes and procedures, in which Subcontractor performs the Subcontractor Work hereunder; (ii) perform the tasks attributed to AMSC and ensure the performance of all tasks attributed to the other subcontractors engaged by AMSC (“Other Subcontractors”), set forth in the Statement of Work, (iii) perform in accordance with the terms of the Prime Contract, (iv) perform its responsibilities in accordance with this Agreement and the Appendices, including by meeting all milestones that are AMSC’s responsibility; and (v) cooperate with and provide reasonable support to Subcontractor in connection with Subcontractor’s performance of its obligations under this Agreement (collectively (i) through (v) are referred to as the “AMSC Obligations”). AMSC represents and warrants that AMSC and each of its Other Subcontractors has, and shall have, the legal right to perform the AMSC Obligations. AMSC shall provide AMSC personnel and Other Subcontractors that have the necessary skills and experience to perform the AMSC Obligations. AMSC shall cause the AMSC Obligations to be performed in a professional and workmanlike manner, and AMSC shall use commercially reasonable efforts to cause the AMSC Obligations to be performed in a timely manner. If AMSC receives notification of default or breach of the Prime Contract from DHS, AMSC shall immediately notify Subcontractor of such default or breach, and whether AMSC disputes such notice of default or breach, and to the extent such default or breach relates to the Project, provide Subcontractor a reasonable opportunity to assist in remedying such default or breach.

1.4.    Acceptance. AMSC shall notify the Subcontractor in writing when the HTS Cable System (as defined in Appendix A) is ready for inspection and testing. If Subcontractor concurs that the HTS Cable System is ready for inspection and testing, Subcontractor will make the inspection and conduct testing within thirty (30) days. If the HTS Cable System performs in accordance with the terms of this Agreement, including the warranties set forth in Sections 16.1 and 16.2, and the terms of any applicable Statement of Work, Subcontractor shall accept the System by delivering a written notice of acceptance (the “Notice of Acceptance”) to AMSC within ten (10) days after the completion of testing. In the event Subcontractor does not send either a Notice of Acceptance or notice of deficiencies within such ten (10) day period, then AMSC shall notify the Subcontractor in writing that Subcontractor has an additional ten (10) days from the receipt of such notice to send either a Notice of Acceptance or notice of deficiencies. In the event Subcontractor does not send either a Notice of Acceptance or notice of deficiencies within such subsequent ten (10) day period, then the HTS Cable System shall be deemed accepted by Subcontractor (“Deemed Acceptance”). Subcontractor shall not have a right to rescind Acceptance once provided. Notwithstanding anything to the contrary herein, Subcontractor shall have no obligation to accept the HTS Cable System if there has been an adverse event under Section 2.2.4 of this Agreement within thirty (30) days prior to the Acceptance (as defined below) of the HTS Cable System. As used in this Agreement,

the term “Acceptance” shall mean the first to occur of (i) Subcontractor delivers a Notice of Acceptance, or (ii) a Deemed Acceptance.

1.5.     This Agreement is comprised of the following:

•This Subcontract Agreement

•Appendix A – Statement of Work

•Appendix B – Limited Rights Proprietary Information

•Appendix C – reserved

•Appendix D – Letter of Credit

•Appendix E – Backup Inventory

•Appendix F – Assigned Warranties

•Appendix G – Proposed DHS Amendment

In the event there is a conflict between the provisions contained herein and those of the Appendices, the order of precedence shall be as listed above.

1.6.    Each Party shall perform its obligations in a competent, timely and efficient manner and in compliance in all material respects with all laws, statutes, codes, ordinances, rules, regulations, lawful orders, applicable guidance documents from regulatory agencies including judicial decrees and interpretations, standards, permits and licenses, including environmental laws, tax laws and applicable tax treaties, health, safety, building, and employment laws, as amended from time to time, of all Governmental Authorities that are applicable to such Party’s respective obligations hereunder or applicable to any related Project documentation (“Applicable Law”). As used herein, the term “Governmental Authorities” shall mean any and all federal, state, county, municipal, local government, or any agency or subdivision of any or all of the foregoing, or any quasi-governmental agency, self-regulating organization, board, bureau, commission, department, instrumentality, or public body, or any court, administrative agency, arbitrator, mediator, regulator, or other tribunal or adjudicative authority with jurisdiction over the applicable Party and/or the Project.

1.7.    Delays. To the extent permitted by Applicable Law, whenever a Party becomes aware that any actual or potential condition, event or occurrence (other than a Force Majeure Event (as defined below), in which case the provisions of Section 17.5 shall apply) may (a) delay or threaten to delay its timely performance hereunder, or (b) render it impossible or impractical to perform its obligations, the Party so affected shall promptly give notice thereof to the other Party, including the cause and expected duration of the delay and all other relevant information with respect thereto.

2.1.    Term. The period of performance of this Agreement shall begin on the Effective Date and, unless sooner terminated in accordance with this Section 2, shall continue through and until the completion of the Warranty Period (as defined below) (the “Term”).

2.2.    Termination Events.

2.2.1.    Termination for Bankruptcy. Either Party may, by written notice to the other Party, cancel the whole or any portion of the Agreement in the event the other Party (i) becomes insolvent or admits its inability to pay its debts generally as they become due; (ii) becomes subject, voluntarily or involuntarily, to any proceeding under any domestic or foreign bankruptcy or insolvency law, which is not fully stayed within seven (7) business days or is not dismissed or vacated within ninety (90) days after filing; (iii) is dissolved or liquidated or takes any corporate action for such purpose; (iv) makes a general assignment for the benefit of creditors; or (v) has a receiver, trustee, custodian or similar agent appointed by order of any court of competent jurisdiction to take charge of or sell any material portion of its property or business.

2.2.2.    Termination for Breach. In the event that either Party commits any material breach of any representation, warranty or obligation under this Agreement which is not, within thirty (30) days of written notice thereof, (i) cured, (ii) is in the process of being cured pursuant to a plan as agreed upon by the Parties, or (iii) as may otherwise be negotiated by the Parties, the non-breaching Party may immediately terminate this Agreement; provided that Subcontractor may terminate this Agreement immediately upon written notice in the event that AMSC fails to provide the Letter of Credit (including any required replacement or renewal thereof) pursuant Section 3.4. For the avoidance of doubt, AMSC’s failure to deliver the HTS Cable System which performs in accordance with the terms of this Agreement, including the warranties set forth in Section 16 and the terms of any applicable Statement of Work, shall be a material breach under this Agreement, subject to AMSC’s opportunity to cure as set forth in the previous sentence.

2.2.3.    Termination of or Amendment to the Project by U.S. Government. AMSC shall notify Subcontractor within three (3) days following the occurrence of (a) sending or receiving any notice of termination of the Prime Contract, (b) any termination of the Prime Contract, or (c) any amendments to the Prime Contract with regards to the Project, other than the amendments set forth in the Proposed DHS Amendment. For the avoidance of doubt, only amendments to the Prime Contract which would affect the Project, including with respect to construction requirements or standards, a Party’s expenditure of funds or time, or the ability of the either Party to perform its obligations in connection with the Project, shall be subject to Section 2.2.3(c).

adjustments to this Agreement that may be requested by Subcontractor as a result of the OTA Change (“Requested Adjustment”). If, during the 30 days after the date that AMSC receives the Negotiation Request, or during any longer period as agreed upon in writing by the Parties, the Parties cannot reach an agreement with respect to any Requested Adjustment, either Party can terminate this Agreement by delivering a written termination notice to the other Party (“Termination Notice”). The Parties shall use good faith efforts to negotiate and cooperate with each other regarding any Requested Adjustment. Upon delivery of a Termination Notice, the Agreement shall terminate.

Subcontractor shall be deemed to have waived its right to require a Subsequent Requested Adjustment with respect to such Subsequent DHS Amendment and neither Party shall be entitled to terminate this Agreement pursuant to Section 2.2.3.3.3.

2.2.4.    Termination for Adverse Events. Subcontractor may terminate this Agreement within thirty (30) days after receipt of notice pursuant to Section 2.2.5 if any of the following events occur at any time from the Effective Date until the date the HTS Cable System has been Accepted in accordance with Section 1.4 herein (“Commissioning”):

2.2.5.    Notification of Adverse Event.

2.2.6.     Termination for Lack of Acceptance of Approvals.

2.2.7.    Reimbursement of Allowable Costs Upon Termination. In the event of any termination of this Agreement, Subcontractor shall provide to AMSC a termination proposal detailing all unpaid costs and expenses that have not already been reimbursed by Payable Milestone(as defined in Section 3.2) payments hereunder incurred through the effective date of termination (“Unpaid Amounts”).

2.2.8.    Effect of Termination.

indefinitely. Termination shall not prejudice either Party’s rights accruing with regard to any period prior to the effective date of termination.

3.1.    The total projected value to be reimbursed to Subcontractor for the Subcontractor Work required to be provided pursuant to this Agreement, including all taxes, is US $1,000,000. AMSC’s total projected value of AMSC’s contribution of AMSC Obligations for the Project is [***], which amount includes the full cost of providing the HTS cable. AMSC shall pay to Subcontractor the amounts set forth below on the dates provided when Subcontractor satisfactorily completes the corresponding Milestone (“Payable Milestone”) or as otherwise set forth in the Statement of Work. Section 3.1 and 3.2 may be revised or modified in accordance with subparagraph 3.2.1 herein, however the Subcontractor’s reimbursement shall not exceed One Million Dollars (USD $1,000,000) in cash. The foregoing limitation shall exclude amounts due to Subcontractor in connection with any change order mutually agreed to by the Parties, or in connection with AMSC's indemnification obligations or the Letter of Credit obligations, and shall not be deemed to limit any remedy of Subcontractor at law, in equity or otherwise available pursuant to the terms of this Agreement. Failure to provide reimbursement of a Payable Milestone as and when required pursuant to Section 3.2 and 3.3 shall be deemed to be a material breach of this Agreement subject to Section 2.2.2 of this Agreement.

3.2.    Schedule of Milestones

3.2.1.    At any time during the Term of the Agreement, progress or results may indicate that a change in the Statement of Work and/or the Schedule of Payable Milestones (the “Schedule”) would be beneficial or required to achieve the program objectives. Recommendations for modifications, including justifications to support any changes to the Statement of Work and/or the Schedule will be documented in a letter and submitted by the Subcontractor to AMSC. This letter will detail the technical, chronological and financial impact, to the extent known to Subcontractor, of the proposed modification to this Agreement. Any resultant modification is subject to the mutual written agreement of the Parties. AMSC is not obligated to pay for, nor is Subcontractor obligated to perform, under the additional or revised Statement of Work or Schedule of Payable Milestones until such are formally adopted by mutual written agreement in accordance with the terms of this Agreement.

3.3.    Payments

Subcontractor shall invoice AMSC for each completed Payable Milestone per this Section 3, and the following information shall be included on each such invoice:

Send Invoices to:

American Superconductor Corporation

Attn: Accounts Payable

114 East Main Street

Ayer, MA 01432

Or email to: ***@***

With a copy to:

American Superconductor Corporation

Attn: [***]

114 East Main Street

Ayer, MA 01432

Or email to: [***]@amsc.com

3.3.2.    AMSC shall reimburse Subcontractor for each completed Payable Milestone accomplished in accordance with Section 3.2 and the Statement of Work, delivered and invoiced in accordance with Section 3.3 above and approved by AMSC, subject only to Changes effectuated pursuant to Section 7. Any cost overruns incurred by Subcontractor as a result of Subcontractor’s negligence or breach of its obligations to perform the Subcontractor Work pursuant to the terms of this Agreement, will be paid entirely by Subcontractor. Any cost overruns incurred by Subcontractor as a result of AMSC’s or AMSC’s Other Subcontractor’s negligence or breach of its obligations to perform the AMSC Obligations pursuant to the terms of this Agreement, will be paid by AMSC. The Payable Milestones shall be the payment to which Subcontractor is entitled from AMSC in consideration of the completion of the Payment Milestones and shall become payable only after Subcontractor certifies that such Payable Milestone has been met. Payment shall be made by wire transfer to Subcontractor of immediately available funds in accordance with the instructions set forth immediately below or such other instructions as Subcontractor may hereafter provide by written notice delivered in accordance with this Agreement. Payments will be made by AMSC to Subcontractor’s address set forth below no later than thirty (30) days after Subcontractor delivers an invoice in accordance with Section 3.3 hereof. Subcontractor shall provide the following payment information to AMSC:

Bank Account of Subcontractor:

Bank Name:    

Bank Address:    

BIC:            

Account Number:    

shall deliver (or cause to be delivered) to Subcontractor a clean, irrevocable Letter of Credit (as defined below) in form and content satisfactory to Subcontractor, naming Subcontractor as beneficiary, a copy of which is attached to this Agreement as Appendix D within ten (10) business days after the date on which the first of the following events occurs: (1) AMSC and DHS have signed the DHS Amendment, and the DHA Amendment does not contain an OTA Change pursuant to Section 2.2.3.2; (2) the DHS Amendment contains an OTA Change and the Subcontractor fails to deliver a Negotiation Request on or before 30 days after receipt of a Modification Notice pursuant to Section 2.2.3.2.4; (3) the DHS Amendment contains an OTA Change and Subcontractor provides AMSC with written notice that it has waived its right to a Requested Adjustment pursuant to Section 2.2.3.2.4, or (4) the DHS Amendment contains an OTA Change and the Parties have reached an agreement with regards to the Requested Adjustment. The Letter of Credit must be issued by an issuing financial institution having an A- or better rating by Standard & Poor's. As used in this Agreement, “Letter of Credit” shall mean the letter of credit delivered to Subcontractor pursuant to this Section 3.4, any replacement letter of credit, and any amendment or renewal of the letter of credit or the replacement letter of credit. If AMSC at any time provides a confirming letter of credit, a replacement confirming letter of credit or an amendment or renewal of the confirming letter of credit or the replacement letter of credit, then the term “Letter of Credit” in this Agreement shall also mean the confirming letter of credit as so amended, renewed or replaced. The initial Letter of Credit to be provided under this Agreement shall have a minimum term of one year and shall automatically renew for additional renewal terms of no less than six (6) months through Commissioning and until the earlier to occur of (i) 60 days after final, unconditional and non-appealable acceptance of the HTS Cable System into the ratebase or (ii) termination of the Warranty Period (as defined below), unless the Letter of Credit or Agreement has already been terminated or cancelled by Subcontractor or otherwise drawn in full by Subcontractor. The Letter of Credit shall initially be in the amount of $5,000,000. The Letter of Credit shall be valid for such time or until Subcontractor draws the full amount of the Letter of Credit or Subcontractor terminates the Letter of Credit. Subject to the terms of this Agreement, Subcontractor shall be entitled to draw on the Letter of Credit upon providing notice within sixty (60) days following the occurrence of (a) any event that would give rise to Subcontractor's right to terminate or draw on the Letter of Credit pursuant to Section 2.2.8, or (b) any breach or failure to perform by AMSC any obligation to deliver a deliverable or provide a service expressly required or included in its respective obligations pursuant to the terms of this Agreement or the applicable Statement of Work, in each case irrespective of whether or not Subcontractor terminates the Agreement, or (c) [***].

3.5.    U.S. Comptroller General Access to Records. To the extent that the total Government payments under this Agreement exceed $5,000,000 or to the extent required by Applicable Law, the Comptroller General, at its discretion, shall have access to and the right to examine records of any party to the Agreement or any entity that participates in the performance of this Agreement that directly pertain to and involve transactions relating to, the Agreement for a period of three (3) years after final payment is made. This requirement shall not apply with respect to any party to this Agreement or any entity that participates in the performance of the Agreement, or any subordinate element of such party or entity, that has not entered into any other contract, grant, cooperative agreement, or “other transaction” that provides for audit access by a Government entity in the 12 month period prior to the date of this Agreement. This paragraph only applies to any record that is created or maintained in the ordinary course of business or pursuant to a provision of law. The terms of this paragraph shall be included in all sub-agreements to the Agreement.

4.1.    Any and all Proprietary Information (as that term is defined in the NDA and which shall also include Proprietary Information described in Section 5 herein) disclosed by either Party during the course of performance under this Agreement shall be subject to the terms and conditions contained in the NDA, as modified from time to time by written agreement by the Parties.

4.2.    Notwithstanding any other term of this Agreement, or any other agreement between the Parties:

4.2.1.    Subcontractor hereby grants to AMSC, its affiliates, and their successors and assigns a nonexclusive, worldwide, royalty­free, right under Subcontractor’s Proprietary Information and all intellectual property owned or controlled by Subcontractor, to perform the AMSC Obligations during the Term for the Project, through their employees and Other Subcontractors providing services for the Project.

4.2.2.    AMSC hereby grants to Subcontractor, its affiliates, and their successors and assigns, a nonexclusive, worldwide, royalty­free, perpetual, irrevocable, right under AMSC’s Proprietary Information and all intellectual property owned or controlled by AMSC, necessary to perform the Subcontractor Work, and use, operate and maintain the HTS Cable System and any related or successor equipment and resources developed, delivered or deployed in connection with the Project , through their employees and subcontractors.

4.3.    AMSC represents and warrants that other than the rights licensed pursuant to Section 4.2, no consent of any third party is necessary to use, operate and maintain the HTS Cable System; provided that the sole liability for infringement, misappropriation or violation of a third party’s intellectual property shall be set forth in Section 9.3 hereof .

5.1.    Definitions.

The following is taken directly from the Prime Contract and required to be flowed down to all subcontractors and, therefore, changes are not allowed. For the avoidance of doubt, as used in this Article, “CONTRACTOR” means Subcontractor and ”PRIME CONTRACT” shall also mean this Agreement.

As used in this Article, the following terms shall have the following meanings and such meanings shall be applicable to both the singular and plural forms of the terms. All other terms of this Section 8 shall be ascribed their plain, commonly accepted definitions.

5.1.1.    “PRIME CONTRACT” means the Other Transaction Agreement No. HSHQDC-08-9-00001, including the preceding letter contract, Phases 0-2, and any modifications thereto.

5.1.2.    “AUTHORIZED CONTRACTOR” means a DHS technical support services contractor, which is supporting the DHS OT Officer’s Representative, the Department of Energy’s (DOE’s) national laboratories, the National Aeronautics and Space Administration’s (NASA’s) Space Center Management Contractors and the Contractor for the operation and management of the Jet Propulsion Laboratory, the Department of Defense’s (DoD’s) Federally Funded Research and Development Centers and University Affiliated Research Centers.

5.1.3.    “BACKGROUND DATA” are any copyrightable work (WORKS), PROPRIETARY INFORMATION, TECHNICAL DATA, or COMPUTER SOFTWARE, CREATED exclusively at private expense prior to the award of or outside the scope of the PRIME CONTRACT.

5.1.4.    “CREATED,” in relation to any WORK, means when the WORK is fixed in any tangible medium of expression for the first time, as provided at 17 U.S.C. § 101. “Background Works” are Works Created outside of the PRIME CONTRACT and “Foreground Works” are Works Created under the PRIME CONTRACT.

5.1.5.    “CRITICAL ENERGY INFRASTRUCTURE INFORMATION” means specific engineering, vulnerability, or detailed design information about proposed or existing critical infrastructure that: (1) relates details about the production, generation, transportation, transmission, or distribution of energy; (2) could be useful to a person in planning an attack on critical infrastructure; (3) is exempt from mandatory disclosure under the Freedom of Information Act, 5 U.S.C. 552 (2000); and (4) does not simply give the general location of the critical infrastructure. However, data that convey general operating, performance, and evaluation of operation characteristics of the HTS/FCL cable system will be considered FORM, FIT, and FUNCTION DATA.

5.1.6.    “DATA” means recorded information, regardless of form or the media on which it may be recorded. The term includes TECHNICAL DATA and COMPUTER SOFTWARE. The term does not include information incidental to contract administration, such as financial, administrative, cost or pricing, or management information.

5.1.7.    “FORM, FIT, AND FUNCTION DATA” means data relating to items, components, or processes that are sufficient to enable physical and functional interchangeability, and data identifying source, size, configuration, mating, and attachment characteristics, functional characteristics, and performance requirements. For computer software it means data identifying source, functional characteristics, and performance requirements but specifically excludes the source code, algorithms, processes, formulas, and flow charts of the software.

5.1.8.    “GOVERNMENT” or “U.S. GOVERNMENT” or “UNITED STATES GOVERNMENT” means the Government of the United States of America. For the purpose of limitations on the disclosure of BACKGROUND DATA, PHASES 0-2 FOREGROUND DATA, the Government means Federal employees of DHS, DOE, NASA, and DoD.

5.1.9.    “GOVERNMENT PURPOSE” means any activity in which the GOVERNMENT is a party, including cooperative agreements with international or multi-national defense organizations or sales or transfers by the GOVERNMENT to foreign governments or international organizations. GOVERNMENT PURPOSES include competitive procurement, but do not include the rights to use, modify, reproduce, release, perform, display, or disclose SUBJECT INVENTIONS or GOVERNMENT PURPOSE RIGHTS DATA for commercial purposes or authorize others to do so.

5.1.10.    “GOVERNMENT PURPOSE RIGHTS DATA” means TECHNICAL DATA OR COMPUTER SOFTWARE that is PHASES 0-2 FOREGROUND DATA, to the extent that the type of data is listed on Appendix B.

5.1.11.    “GOVERNMENT PURPOSE RIGHTS” means the rights to—

5.1.12.    “INVENTION” means any invention or discovery that is or may be patentable or otherwise protectable under Title 35 of the United States Code or any novel variety of plant which is or may be protectable under the Plant Variety Protection Act (7 U.S.C. § 2321 et seq.).

5.1.13.    “LIMITED RIGHTS DATA” means BACKGROUND DATA.

5.1.14.    “LIMITED RIGHTS” means the rights to use, modify, reproduce, release, perform, display, or disclose, in whole or in part, within the GOVERNMENT but only in connection with this Project. The GOVERNMENT may not, without the written permission of the Contractor, release or disclose the LIMITED RIGHTS DATA outside the GOVERNMENT, use the LIMITED RIGHTS DATA for manufacture, or authorize the LIMITED RIGHTS DATA to be used by another party, except that the GOVERNMENT may reproduce, release or disclose such LIMITED RIGHTS DATA or authorize the use or reproduction of the LIMITED RIGHTS DATA by AUTHORIZED CONTRACTORS if reproduction, release, disclosure, or use is for-

5.1.15.    “MADE” in relation to any INVENTION means the conception or first actual reduction to practice of such INVENTION.

5.1.16.    “PATENT” means an invention, for which the U.S. Patent and Trademark Office has issued a PATENT under title 35 of the U.S. Code, or any variety of plant that is or may be protectable under the Plant Variety Protection Act (7 U.S.C. § 2321, et seq.)

5.1.17.    “PRACTICAL APPLICATION” means to manufacture, in the case of a composition of product; to practice, in the case of a process or method, or to operate, in the case of a machine or system; and, in each case, under such conditions as to establish that the INVENTION is capable of being utilized and that its benefits are, to the extent permitted by law or GOVERNMENT regulations, available to the public on reasonable terms.

5.1.18.    “PROPRIETARY INFORMATION” means BACKGROUND DATA, including but not limited to that listed in Attachment 1 (“LIMITED RIGHTS PROPRIETARY INFORMATION”) hereto, owned by CONTRACTOR which was CREATED exclusively at private expense prior to the award of or outside the scope of the PRIME CONTRACT and which embodies trade secrets or which:

5.1.19.    “SPECIAL PURPOSE LICENSE” means a license to the GOVERNMENT conveying a nonexclusive, nontransferable, irrevocable, worldwide, royalty-free license to practice and have practiced any SUBJECT INVENTION for or on behalf of the GOVERNMENT for GOVERNMENT PURPOSES only.

5.1.20.    “SUBJECT INVENTION” means any INVENTION of any party MADE by its employees under the PRIME CONTRACT.

5.1.21.    “TECHNICAL DATA” means recorded information of a scientific or technical nature, regardless of form or the media on which it may be recorded, CREATED or used under the PRIME CONTRACT. The term includes TECHNICAL DATA and COMPUTER SOFTWARE.

5.1.22.    “COMPUTER SOFTWARE” as used in this clause, means computer programs, computer data bases, and documentation thereof, CREATED or used under the PRIME CONTRACT.

5.1.23.    “UNLIMITED RIGHTS” means the rights of the GOVERNMENT to use, disclose, reproduce, prepare derivative works, distribute copies to the public, and perform publicly and display publicly, in any manner and for any purpose, and to have or permit others to do so.

5.2.    Patents.

5.2.1.    PATENT Identification.

the construction, alteration, modification, or repair of real property (hereinafter referred to as “construction work”) under the Agreement, or out of the use or disposal by or for the account of AMSC of such supplies or construction work, but only in the event the infringement liability is based solely on the use, manufacture, offering for sale, sale, or importation of the deliverables provided by CONTRACTOR in accordance with this Agreement and any related BACKGROUND PATENTS. For avoidance of doubt, if the infringement liability is based on supplies, services, or construction work (A) covered by the SUBJECT INVENTIONS listed in Appendix B, (B) provided by AMSC or any other subcontractor of AMSC or (C) provided pursuant to services for any other portion of the Project not required pursuant to Section 2.2, CONTRACTOR shall have no indemnity obligation pursuant to this Agreement.

(A)    An infringement resulting from compliance with specific written instructions of the DHS OT Officer directing a change in the supplies to be delivered or in the materials or equipment to be used, or directing a manner of performance of the PRIME CONTRACT not normally used by the CONTRACTOR;

(B)    An infringement resulting from addition to or change in supplies or components furnished or construction work performed that was made subsequent to delivery or performance;

(C)    A claimed infringement that is unreasonably settled without the consent of the CONTRACTOR, unless required by final decree of a court of competent jurisdiction; or

(D)    An infringement resulting from: (1) the performance of AMSC or any other subcontractor of AMSC; or (2) compliance with specific written instructions of AMSC directing a change in the supplies to be delivered or in the materials or equipment to be used, or directing a manner of performance of the Agreement not normally used by the Subcontractor.

5.2.2.    Disclosure of SUBJECT INVENTIONS. The CONTRACTOR will promptly disclose to the DHS OT Officer any SUBJECT INVENTION that is MADE by its employees or is MADE under any of the CONTRACTOR’s subcontracts after the execution of this Agreement.

5.2.3.    Allocation of Principal Rights. Each party shall separately own any SUBJECT INVENTIONS made solely by its employees under the PRIME CONTRACT. The parties shall jointly own SUBJECT INVENTIONS MADE jointly by the GOVERNMENT and any CONTRACTOR employees under the PRIME CONTRACT. The CONTRACTOR hereby grants the GOVERNMENT a SPECIAL PURPOSE LICENSE to each SUBJECT INVENTION.

5.2.4.    Action to Protect the GOVERNMENT’s Interest.

5.2.5.    Reporting on Utilization of SUBJECT INVENTIONS. Upon request by the GOVERNMENT, the CONTRACTOR shall submit a final report on the utilization of SUBJECT INVENTIONS or on efforts at obtaining such utilization that are being made by the CONTRACTOR or its licensees or assignees. The report shall include information regarding the status of development, date of first commercial sale or use, gross royalties received by the CONTRACTOR, its subcontractor(s), and such other data and information as the GOVERNMENT may reasonably specify. The CONTRACTOR also agrees to provide additional reports as may be requested by the GOVERNMENT. The GOVERNMENT shall not disclose such information to persons outside the GOVERNMENT without permission of the CONTRACTOR.

5.2.6.    Non-exclusive Licenses to Others. In addition to the SPECIAL PURPOSE LICENSE, the CONTRACTOR, its exclusive licensee, or any assignee agree to grant a non-exclusive license(s) to a responsible applicant(s), upon terms that are reasonable under the circumstances, if:

If the CONTRACTOR, exclusive licensee, or assignee refuses to grant such a non-exclusive license, the GOVERNMENT has the right to seek resolution through the disputes process set forth in the Prime Contract.

5.3.    Copyrights

5.3.1.    COPYRIGHT Ownership. The CONTRACTOR shall own the copyright in all Foreground and Background Works which are copyrightable under Title 17, United States Code. The Contractor shall have the option to register the copyright at the Contractor’s expense.

5.3.2.    Rights to the GOVERNMENT. The CONTRACTOR hereby grants to the GOVERNMENT:

5.3.3.    Disclosure. The CONTRACTOR shall furnish to the GOVERNMENT, at no cost to the GOVERNMENT and upon written request by the GOVERNMENT, three (3) copies of each FOREGROUND DATA deliverable, if the WORK is required to be delivered to the GOVERNMENT under the PRIME CONTRACT.

5.3.4.    Additional Data Requirements.

5.3.5.    Consultation Before Disclosure.

INFRASTRUCTURE INFORMATION may be disclosed without the prior written consent of the party who owns such information. Prior to submitting a manuscript for publication or before any other public disclosure, each party will offer the other party ample opportunity to review and approve such proposed publication or disclosure, to submit objections, and to file applications for PATENTS in a timely manner. It is understood and agreed between the parties that the Contractor may need to consult with and obtain approval from a subcontractor or other third party whose information may be included in a proposed publication or disclosure and that Contractor will be afforded ample opportunity to do so.

5.4.    Subcontract Agreements. The CONTRACTOR shall include this Section 8, suitably modified, to identify the Parties, in all subcontracts or lower tier agreements, regardless of tier.

6.1.    Delivery. Each Party shall be responsible for the delivery of all deliverables and the performance of all services required or included in its respective obligations pursuant to the terms of this Agreement and the Statement of Work.

6.4.    Installation of the Project. Each Party shall be responsible for the protection and care of the Project equipment and materials of the other Party while in the control or possession of such receiving Party or its subcontractors. Subcontractor shall make regular and diligent progress to complete the installation and energization of the Project in accordance with the terms and conditions of this Agreement.

7.1.    Any Party may request, at any time and from time to time, by written notice to the other Party, a change in Project specifications or designs, or to the method of packing or shipment, quantity ordered, destination or delivery schedule of Project equipment (each a “Proposed Change”). If any such Proposed Change causes an increase or decrease in Subcontractor’s cost and/or the time for performance, Subcontractor shall notify AMSC in writing within fifteen (15) days after the date of written notice of the Proposed Change and such notice by Subcontractor shall include details of any cost and/or schedule impact, as applicable (“Change Proposal”). If AMSC and Subcontractor agree to the Change Proposal, AMSC shall submit such Change Proposal to DHS, and upon written approval by DHS, including approval of an increase in costs and DHS’s obligation to reimburse such increased costs related to the Change Proposal, Subcontractor and AMSC shall implement the Proposed Change. Both parties acknowledge that the time

to process a Proposed Change may increase the overall Project schedule and that each Party will bear its own costs associated with that delay. If AMSC or Subcontractor does not agree to such Change Proposal or DHS does not approve such Proposed Change, the Parties shall continue the performance of their obligations hereunder and the Proposed Change shall not be effective. In no event shall either Party be bound by any Change Proposal or Proposed Change absent a written change order executed by Subcontractor and AMSC.

7.2.    Notwithstanding Section 7.1, AMSC shall agree to implement any Proposed Change to the extent Technically Feasible upon Commercially Reasonable Terms and shall agree to implement any Proposed Change without additional charge or schedule change to the extent the Proposed Change does not require material deviations from any Statement of Work, or from costs otherwise projected for such changed item. As used in this Section 7.2, the term “Technically Feasible” means capable of accomplishment as evidenced by prior commercial success within the superconductor industry for similar projects deployed worldwide; and “Commercially Reasonable Terms” means both financial and commercial terms that, individually and in the aggregate, are consistent with concepts of good faith and fair dealing and are no less favorable to Subcontractor than those contained in this Agreement, if any, and to other AMSC customers in similar circumstances for similar work, if any.

8.1.    Subcontractor shall submit reports (the "Reports") to AMSC at such times and frequencies and containing such information as is required in writing by DHS or set forth in the applicable Statement of Work or required under the Prime Contract.

8.2.    Subcontractor represents and warrants that, to the best of its knowledge after due inquiry, all information included in the Reports shall be true and accurate in all material respects.

8.3.    Subcontractor expressly acknowledges and understands that the Reports may be delivered by AMSC to the DHS.

8.4.    AMSC shall have no obligation to Subcontractor to review the Reports, and neither Party shall be liable for claims made by third parties, except for any United States government agency, against the other Party for any errors or omissions in the Reports required or provided by such other Party.

9.2.    Indemnification by AMSC. AMSC shall indemnify, defend and hold harmless Subcontractor, its affiliates and each of their respective officers, directors, employees, agents, successors and permitted assigns from and against any claim, loss, damage, liability or expense (including reasonable attorney’s fees) arising out of any personal injury (including death) to or property damage experienced by any third party, including without limitation Subcontractor’s employees, subcontractors and independent contractors, as a result of: (i) death or bodily injury to the extent caused by AMSC, its subcontractors or any affiliate thereof (ii) the gross negligence or willful and reckless misconduct of AMSC in its performance of its obligations under this Agreement (except to the extent resulting from the acts taken or omitted by AMSC or its employees or subcontractors at the direction of Subcontractor or its subcontractors, vendors or agents or for any design or specifications provided or approved by Subcontractor or its subcontractors, vendors or agents); (iii) AMSC’s failure to pay and discharge any taxes (including interest and penalties) for which AMSC or its subcontractors is responsible, or any lien or encumbrance placed upon the property of Subcontractor or its affiliates or subcontractors in connection with this Agreement as a result of AMSC or its subcontractor's acts or omissions; or (iv) any claim that any employee of AMSC, its affiliates, its contractors, or subcontractors is an employee of Subcontractor or a jointly employed by Subcontractor and AMSC. To receive the benefit of indemnification under this Section, the indemnified party must promptly notify AMSC of a claim or suit and provide reasonable cooperation (at AMSC’s expense) and tender to AMSC (and its insurer) full authority to defend or settle the claim or suit (provided that AMSC shall obtain Subcontractor’s prior written consent to any settlement that admits fault or wrongdoing on the part of Subcontractor or obligates Subcontractor to pay any amount not fully indemnified under this Agreement). AMSC has no obligation to indemnify for any settlement made without its consent or for any claim to the extent lack of prompt notice shall have prejudiced AMSC.

9.3.    Intellectual Property Indemnity

9.3.1.    Indemnity. Each Party (the “Indemnifying Party”) shall indemnify, defend and hold the other Party, its affiliates and each of their respective officers, directors, employees, agents, successors and permitted assigns (the “Indemnified Party”) harmless from and against all liabilities, damages, expenses, judgments and losses (including reasonable attorneys’ fees) (“Losses”) arising from claims raised by any

third party alleging infringement, misappropriation or violation of such third party’s intellectual property as a result of the Indemnified Party’s use of products, equipment, technology and/or systems (the “Products”) supplied by the Indemnifying Party, provided that the Indemnified Party provides to the Indemnifying Party prompt written notice of such claim, reasonable assistance in connection with the defense of such claim, and control over the negotiation, litigation, and settlement of such claim.

9.3.2.    Remedy for Infringement.

9.3.3.    Sole Liability. Except to the extent set forth in Section 5, this section states the Indemnifying Party’s sole liability for intellectual property infringement for which the Indemnifying Party is responsible hereunder. If there is a conflict between Section 5.2.1.2 and this Section 9.3., Section 5.2.1.2 shall govern.

9.4.    Survival. The Parties’ respective indemnity obligations shall survive completion of the work and, in any event, for [***] ([***]) years after the earlier to occur of (a) termination of this Agreement and (b) [***] years from the date of Commissioning; provided that with respect to any claims for indemnification for which a party has provided notice to the other party within such period, the rights and obligations of the parties with respect to such indemnified claims shall continue through the full and final resolution of such claims.

9.6.    Waiver of Consequential Damages. EXCEPT WITH REGARD TO CAUSES OF ACTIONS ARISING FROM A PARTY’S OR ITS AFFILIATE’S OR SUBCONTRACTORS’ FRAUD, GROSS NEGLIGENCE OR WILLFUL AND INTENTIONAL MISCONDUCT, A BREACH OF CONFIDENTIALITY OBLIGATIONS OR DAMAGES FOR INDEMNIFICATION FOR BODILY INJURY OR DEATH AS SET FORTH IN, AND SUBJECT TO THE PROVISIONS OF, SECTIONS 9.1 AND 9.2 OF THIS AGREEMENT, NO PARTY SHALL BE LIABLE FOR ANY INDIRECT, INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES.

11.1.    Assignment. This Agreement may not be assigned or transferred, in whole or in part, by either Party without the prior written consent of the other Party, which consent shall not be unreasonably withheld or delayed.

11.2.    Amendment. This Agreement may not be amended except by a written instrument, signed by the Parties.

12.1.    All notices required or permitted to be given under this Agreement shall be in writing and signed by or on behalf of the Party giving it and shall be given by hand delivery, courier or by prepaid recorded airmail to the respective addresses for the Party to receive it as shown below (or at such other address as such Party shall have specified by a notice given to the other Party hereto in accordance with this Section 12.1). All such notices shall be deemed to be given (i) if delivered by hand or courier, when delivered, and

(ii) if sent by prepaid recorded airmail delivery or regulated airmail post, upon receipt; provided, however, that any delivery made after 5:00 pm on a business day or at any time on a non-business day shall be deemed to be received on the next following business day.

American Superconductor Corporation

114 East Main Street

Ayer, MA 01432

Attention: [***]

Telephone: [***]

[***]@amsc.com

With a copy to:

American Superconductor Corporation

114 East Main Street

Ayer, MA 01432

Attention: General Counsel

***@***

Commonwealth Edison

Attention: [***]

With a copy to (which copy shall not be deemed notice):

[***]Ballard Spahr LLP

1735 Market St., Suite 5100

Philadelphia, PA 19103

Telephone: [***]

13.1.    Organization and Qualification of the Parties. Each Party represents and warrants that it is duly organized, validly existing and in good standing under the laws of the state of its formation and has all necessary power and authority to enter into this Agreement and the agreements contemplated hereunder, including without limitation its agreements with subcontractors to carry out its obligations hereunder. Each Party is duly licensed or qualified to do business and is in good standing in each jurisdiction where such licensing or qualification is necessary to perform its obligations hereunder, except for such failure to license or qualify that would not reasonably be expected to have an adverse effect on such Party’s ability to perform its obligations pursuant to the terms hereof.

13.3.    Compliance with Laws. Each Party has conducted its business in accordance with all material respects of Applicable Laws and is not in violation of any Applicable Law, except for such failure to comply or violations that would not reasonably be expected to have an adverse effect on such Party’s ability to perform its obligations pursuant to the terms hereof.

13.4.    Except for the permits required to be obtained by Subcontractor set forth on Appendix A, Subcontractor has obtained or will obtain in a timely manner all approvals and consents of third parties necessary for it to perform its obligations under this Agreement.

13.5.    AMSC has obtained or will obtain in a timely manner all approvals and consents of third parties necessary for it to perform its obligations under this Agreement.

13.6.    This Agreement constitutes the valid and binding agreement of the Parties, enforceable against each Party in accordance with its terms, subject only to (i) applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, or other laws of general application relating to or affecting the enforcement of creditors’ rights generally, and (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.

13.7.    AMSC represents that the Refrigeration System (as defined in Appendix A) together with the Bailed Property (as defined below) are sufficient to support, use, operate and maintain the HTS Cable System. This representation shall expire and be of no further force and effect upon Commissioning. Upon Commissioning, Subcontractor shall forever release and waive any and all claims and rights under this Section 13.7, including without limitation its right to rescission. For the avoidance of doubt, nothing in this Section 13.7 shall affect Subcontractor’s rights under Section 16.

14.1.    All technical data or commodities of United States origin made available directly or indirectly hereunder shall be used subject to and in accordance with Applicable Laws and regulations of the departments and agencies of the United States Government. Each Party agrees not to export or re-export, directly or indirectly, any technical data of United States origin acquired from the other Party or any commodities using such data to any destination requiring United States Government approval for such re-

export until a request for approval, if necessary, has been submitted to and granted by the United States Government.

15.1.    Except as otherwise set forth in this Agreement, title and risk of loss of the equipment shall pass to Subcontractor upon Acceptance.

15.2.    The site shall remain under Subcontractor’s control throughout the Project and Warranty Period. Subcontractor shall comply with Subcontractor’s jobsite security procedures and at all times conduct operations under this Agreement in a manner to mitigate the risk of loss, theft, or damage by vandalism, sabotage or any other means to any work, materials, equipment or other property.

16.2.    Services Warranty. For the duration of the Warranty Period, AMSC warrants that the services required to be provided by AMSC pursuant to this Agreement, including Appendix A, AMSC Specific Responsibilities ("Services") furnished to Subcontractor under this Agreement will: (1) comply with the operational metrics defined as the circuit and HTS Cable System as a whole, shall be able to operate pursuant to the Specifications and at the design ampacity rating and not have to be de-rated because of HTS Cable System deficiencies, (2) be free from defects in design, workmanship and materials, (3) be conveyed to Subcontractor with good and merchantable title, (4) be free and clear of all security interests, liens, encumbrances or claims of AMSC, Other Subcontractors and third-party suppliers, and (5) be free of any claim of unfair competition, (6) fit for the particular purpose intended therefor to the extent such purpose is set forth in, or reasonably anticipated by, the Agreement, (7) be performed in accordance with the then-

prevailing Applicable Laws, and industry standards and practices, and (8) be fully tested in accordance with the Agreement.

16.3.    Remedies.

16.3.1.    Material. If any Material does not comply with the foregoing warranties and Subcontractor gives AMSC notice of such noncompliance within the Warranty Period, then AMSC will (at its sole expense) promptly correct by repair or replacement any non-conforming Material such that it complies with the foregoing warranties and shall reimburse Subcontractor for the actual and reasonable cost to repair or replace any Subcontractor parties’ property damaged by such non-conforming Material as soon as reasonably possible. [***]. Subject to the limitations in Section 9.5 and 9.6, all costs and expenses associated with the identification of non-conforming Material, repair or replacement of Material or Subcontractor property, including Subcontractor’s and AMSC’s investigations and root cause analyses; gaining access to or removal or replacement of systems, structures or other parts of Subcontractor’s facility and all transportation costs will be paid by AMSC, and Subcontractor may charge AMSC all reasonable expenses of unpacking, examining, repacking and reshipping any rejected Material. All warranties for any repaired or replaced Material will terminate at the end of the Warranty Period.

16.3.2.    Services. If any of the Services do not comply with the foregoing warranties and Subcontractor notifies AMSC within the Warranty Period, then AMSC will (at its sole expense) promptly re-perform the nonconforming Services such that it complies with the foregoing warranties and shall reimburse Subcontractor for the actual and reasonable cost to repair or replace any Subcontractor property damaged by such nonconforming Services as soon as reasonably possible. Subject to the limitations of Section 9.5 and 9.6, all costs and expenses associated with the identification of the non-conforming Services, re-performance of the nonconforming Services and repair or replacement of Subcontractor property, including Subcontractor’s and AMSC’s investigations and root cause analyses; gaining access to or removal or replacement of systems, structures or other parts of Subcontractor’s facility; and all transportation costs will be paid by AMSC. All warranties for any re-performed Services will terminate at the end of the Warranty Period.

as may be reasonably required to avoid the lapse of any warranty rights with respect to Section 16.7, Subcontractor may correct any deficiencies in the Material or Services, or may purchase replacement Material or Services. Subcontractor may either invoice AMSC for the reasonable cost of correcting the deficiencies (including the costs directly attributable to other services that are required to be performed in connection with the correction of such noncompliance), invoice AMSC for the cost of replacement, or deduct the cost associated with correction or replacement from any payments due or subsequently due AMSC, provided, however, that any third party retained by Subcontractor must comply with the manuals and instructions of AMSC in all material respects, unless otherwise agreed by the Parties in writing, and carry out any such remedy in a workmanlike manner in order for AMSC to be responsible for any subsequent damages under this Section 16.5. AMSC shall not be responsible for damage to the extent resulting from or caused by the failure to comply with such manuals and instructions.

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed by their respective duly authorized representatives as of the date first written above.

AMERICAN SUPERCONDUCTOR CORPORATION        COMMONWEALTH EDISON

By: /s/ Daniel Patrick McGahn        By: /s/ Terence Donnelly            

Print Name: Daniel Patrick McGahn        Print Name: Terence Donnelly            

Title: Chairman, President & CEO        Title: President and Chief Operating Officer    

Date: 10/31/18        Date: 10/31/18                    

We hereby issue this Irrevocable, Unconditional, Standby Letter of Credit, with reference number [NUMBER] (”Standby Letter of Credit”), in favor of Commonwealth Edison Company (”Beneficiary”), for the account of American Superconductor Corporation (”Applicant”), and authorize Beneficiary to draw on us at sight, up to an aggregate amount of $5,000,000.

Partial and multiple drawings are permitted under this Standby Letter of Credit. The aggregate amount available under this Standby Letter of Credit at any time shall be the face amount of this Standby Letter of Credit, less the aggregate amount of all partial drawings previously paid to Beneficiary at such time.

The expiration date of this Standby Letter of Credit (“Expiration Date”) is the date that is the fifth anniversary of the date of Commissioning (as such term is defined in the Subcontract Agreement, dated [_______] [__], 2018 between Applicant and Beneficiary, as such agreement may be amended and supplemented from time to time, whether now or hereafter executed, and any replacements or substitutions thereof), provided that if such date is not a Business Day, the Expiration Date shall be the next following Business Day. As used herein, “Business Day” shall mean any day other than a Saturday, Sunday or day on which banking institutions are authorized or required to be closed in the state of Delaware.

 

Amounts drawn under this Standby Letter of Credit must specify the number of this Standby Letter of Credit, the amount to be drawn, a current contact for Beneficiary including email and telephone number, and wiring instructions for Beneficiary’s account. Any sight draft may be presented to us by electronic, reprographic, computerized or automated system, or by carbon copy, but in any event must visibly bear the word “original” and be presented at the Office for Presentment identified below not later than the Expiration Date. If the document is signed, the signature may consist of (or may appear to us as) an original handwritten signature, a facsimile signature or any other mechanical or electronic method of authentication.

  

Beneficiary shall include with any presentation a copy of this Standby Letter of Credit.  ‌

We undertake to pay Beneficiary under this Standby Letter of Credit within three (3) business days of receipt by us of a sight draft presented pursuant to the terms of this Standby Letter of Credit. Beneficiary shall receive payment from us by wire transfer to a bank account of Beneficiary, as described in such sight draft. If any sight draft presented under this Standby Letter of Credit does not comply with the terms and conditions hereof, we will advise the contact for Beneficiary by email and telephone within one (1) Business Day and give the reasons for such non-compliance.

This Standby Letter of Credit is irrevocable, unconditional and transferable. This Standby Letter of Credit may be transferred without charge one or more times upon receipt of the written instructions of the Beneficiary.

This Standby Letter of Credit sets forth in full our undertaking, and such undertaking shall not in any way be modified, amended, amplified or limited by reference to any document, instrument or agreement referred to herein and any such reference shall not be deemed to incorporate herein by reference any document, instrument or agreement.

This Standby Letter of Credit is governed by and construed in accordance with the laws of the state of Delaware, without regard to conflicts of laws principles.

 

 

1.1.2    Services Warranty. For a period of [***] ([***]) years from the date that the services”) have been accepted pursuant to the terms hereof, Buyer has signed a certificate of final completion for the work related to the services, however not exceeding a maximum period of five years plus 2 weeks after written notice of the Seller of final completion of the Service, Seller warrants that the services furnished to Buyer under these Terms and Conditions will: (1) comply with the specifications contained in or developed in accordance with these Terms and Conditions, (2) be free from defects in design, workmanship and materials, (3) be conveyed to Buyer with good and merchantable title, (4) be free and clear of all security interests, liens, encumbrances or claims of Seller, subcontractors and third-party suppliers, and (5) be free of any claim of infringement, misappropriation, unfair competition or violation of any third-party right, including intellectual property rights, (6) fit for the particular purpose intended therefor to the extent such purpose is set forth in the technical specification, (7) be performed in accordance with the then-prevailing applicable Laws, and industry standards as defined in the technical specification, and (8) be fully tested in accordance with these Terms and Conditions.     

1.1.3    These warranties are in lieu of any warranty of merchantability and other warranties of any kind, whether express or implied.    

1.2.1    Material. If any Material does not comply with the foregoing warranties and Buyer gives Seller notice of such noncompliance within the applicable Material warranty period set forth in this Article 7, then Seller will (at its sole expense) promptly correct by repair or replacement any non-conforming Material. The decision whether to repair or replace any non-conforming Material will be made with the concurrence of Buyer and the repair or replacement will be scheduled consistent with Buyer’s operating requirements so as to minimize loss of production or use of the Material, other material or of any plant or equipment of which the Material is a part. Notwithstanding any other provisions in these Terms and Conditions to the contrary, all costs and expenses associated with the identification of non-conforming Material, repair or replacement of Material or Buyer’s or Commonwealth Edison’s (“ComEd”) property, including Buyer’s and Seller’s investigations and root cause analyses; gaining access to or removal or replacement of systems, structures or other parts of Buyer’s facility and all transportation costs will be paid by Seller, and Buyer may charge Seller all expenses of unpacking, examining, repacking and reshipping any rejected Material. All warranties for any repaired or replaced Material will be [***] ([***]) years from the date of repair or replacement.    

1.2.2    The forgoing warranty shall in no event extend to:    

- Material that have been subject to misuse, mishandling, neglect accidence, damage by circumstances beyond the Seller´s reasonable control,    

- Material that has been repaired, modified or replaced by Byer or any third party without Seller´s prior written authorization.

1.2.3    Services. If any of the services do not comply with the foregoing warranties and Buyer notifies Seller within the applicable services warranty period set forth in this Article 7, then Seller will (at its sole expense) promptly re-perform the nonconforming services and reimburse Buyer for the cost to repair or replace any Buyer’s or ComEd’s property damaged or otherwise adversely affected by such non-conformance. Notwithstanding any other provisions in these Terms and Conditions to the contrary, all costs and expenses associated with the identification of the non-conforming services, re-performance of the nonconforming services and repair or replacement of Buyer’s or ComEd’s property, including Buyer’s and Seller’s investigations and root cause analyses; gaining access to or removal or replacement of systems, structures or other parts of Buyer’s facility; and all transportation costs will be paid by Seller. All such re-performed services and repairs will be performed on a schedule to be agreed upon by Buyer. The warranty for any such re-performed services will be [***] ([***]) years from the date of re-performance of the services    

1.3.    Inspection.

1.3.1    Buyer’s inspection, testing, or payment, will not affect the warranties and obligations of Seller under these Terms and Conditions or these Terms and Conditions, and such warranties and obligations will survive any such inspection, testing, or payment, or use.

1.4.    Buyer’s Right to Perform.

1.4.1    In the event of Seller’s failure to repair or replace the Material within a reasonable period of time, or Seller’s failure to re-perform the Services within a reasonable period of time, in accordance with the terms hereof, Buyer, after notice to Seller, may correct any deficiencies in the Material or Services, or may purchase replacement Material or Services. Buyer may either invoice Seller for the cost of correcting the deficiencies (including the costs directly attributable to other services that are required to be performed in connection with the correction of such deficiencies), invoice Seller for the cost of replacement, or deduct the cost associated with correction or replacement from any payments due or subsequently due Seller.

1.5.    Assignment of Warranties.

1.5.1    Seller consents to Buyer’s assignment to ComEd of all of Buyer’s rights, benefits and interests of every kind arising out of this Section 7. In the event that ComEd reaches out directly to Seller, Seller agrees that it shall provide the benefits of the warranties under this Section 7 to ComEd to the full extent as if ComEd were the Buyer herein.

1.6.    Liability

1.6.1    In the case of damage caused negligently or in case of expenses incurred for supplementary performance, the liability of the Seller shall be limited to [***]% of the contract price per incidence of loss, with a total of [***]% of the contract price. Compensation for indirect damage, for lost profits and loss of production are excluded. The limitation or exclusion of liability applies regardless of the basis of claim (e.g. contract – including indemnification – or tort) and also in favour of the vicarious agents of the Seller, unless mandatory law provides otherwise. In the case of damages caused intentionally, the liability of the Seller is unlimited.

[***]

 

Updated Payable Milestones

 

Updated Schedule of Payments