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Resolution No. 9371
1 RESOLUTION NO. 9371 2 3 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF VERNON APPROVING AND AUTHORIZING THE EXECUTION OF A 4 SERVICES AGREEMENT BY AND BETWEEN THE CITY OF VERNON AND COMBUSTION SCIENCE & ENGINEERING, INC. 5 FOR THE VERNON POWER PLANT PROJECT 6 7 WHEREAS, the City of Vernon (the "City") owns and operates 8 its own electric system which services the City's constituents; and 9 WHEREAS, the City is in the process of developing a natural 10 gas -fired combined cycle power plant located within City limits 11 officially named the Vernon Power Plant (the "VPP Project") for the 12 purpose of installing additional generating capacity that will yield an 13 efficient, cost-effective, and reliable source of electric generation; 14 and 15 WHEREAS, the Light & Power Department desires to retain the 16 services of an independent contractor to conduct a study and prepare a 17 report determining the impact of an Enhanced Turbine Output LLC Power 18 Cool air supercharging system on Siemens SCC6-5000F Combustion Turbine 19 pollutant emissions at baseload conditions at the proposed VPP Project; 20 and 21 WHEREAS, the Director of Light & Power has determined that 22 Combustion Science & Engineering, Inc. ("Combustion Science") is 23 qualified and capable of furnishing the labor, materials and expertise 24 necessary to perform the services that the City requires; and 25 WHEREAS, the City and Combustion Science desire to enter into 26 a Services Agreement setting forth the terms and conditions under which 27 Combustion Science shall perform the study; and 28 WHEREAS, the City Council of the City of Vernon has r i e 1 2 3 4 51 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 determined that, pursuant to the provisions of subsection (a) of Section 2.27 of the Vernon City Code, it is in the public interest and necessity to enter into an agreement with Combustion Science. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF VERNON AS FOLLOWS: SECTION 1: The City Council of the City of Vernon hereby finds and determines that the recitals contained hereinabove are true and correct. SECTION 2: The City Council of the City of Vernon hereby approves the Services Agreement with Combustion Science & Engineering, Inc., in substantially the same form as the copy which is attached hereto as Exhibit A and incorporated by reference. SECTION 3: The City Council of the City of Vernon hereby authorizes the Mayor or Mayor Pro-Tem to execute said Agreement for, and on behalf of, the City of Vernon and the City Clerk is hereby authorized to attest thereto. SECTION 4: The City Council of the City of Vernon hereby authorizes the City Administrator, or his designee, to make whatever nonsubstantive, administrative and/or text changes, upon advice of counsel, to the Agreement. SECTION 5: The City Council of the City of Vernon hereby directs the City Clerk, or her designee, to give one fully executed Agreement to• Combustion Science & Engineering, Inc. Attn. Michael S. Klassen 8940 Old Annapolis Road, Suite L Columbia, MD 21045-2129 - 2 S � s 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 SECTION 6: The City Clerk of the City of Vernon shall certify to the passage of this resolution, and thereupon and thereafter the same shall be in full force and effect. APPROVED AND ADOPTED this 6th day of August, 2007. ATTEST: ELA GIRON, C ty Clerk Name: Leonis C. Malburg Title: Mayor - 3 - 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 STATE OF CALIFORNIA ) ) ss COUNTY OF LOS ANGELES ) I, MANUELA GIRON, City Clerk of the City of Vernon, do hereby certify that the foregoing Resolution, being Resolution No. 9371, was duly adopted by the City Council of the City of Vernon at a regular meeting of the City Council duly held on Monday, August 6, 2007, and thereafter was duly signed by the Mayor or Mayor Pro-Tem of the City of Vernon. (SEAL) MANUELA G City Clerk - 4 - EXHIBIT 0 SERVICES AGREEMENT THIS AGREEMENT is made, entered into and executed in duplicate originals, either copy of which may be considered and used as the original hereof for all purposes, as of this 6th day of August, 2007, in the City of Vernon, County of Los Angeles, California BY AND BETWEEN AND THE CITY OF VERNON, a municipal corporation, hereinafter referred tows the "City," 4305 Santa Fe Avenue Vernon, California 90058 COMBUSTION SCIENCE & ENGINEERING, INC., hereinafter referred as "Contractor," 8940 Old Annapolis Road, Suite L Columbia, MD 21045-2129 RECITALS WHEREAS, the City desires to retain the services of an independent contractor to conduct a study and prepare a report determining the impact of an Enhanced Turbine Output LLC Power Cool air supercharging system on Siemens SCC6-5000F Combustion Turbine pollutant emissions at baseload conditions at the proposed Vernon Power Plant Project (the "Services"); and WHEREAS, Contractor has prepared a scope and fee proposal dated June 22, 2007, for the Services, a copy of which is attached hereto as Exhibit A and incorporated by this reference (the "Proposal'); and WHEREAS, Contractor represents that it is qualified and capable of furnishing the labor, materials and expertise necessary to perform the Services that the City requires, as set forth in this Agreement, and is willing to do so on the terms and conditions set forth below; and WHEREAS, the Contractor's cost proposal is acceptable to the City; and Page 1 of 20 WHEREAS, the City desires to enter into an agreement with Contractor to perform the Services on a contractual basis as defined in the terms and conditions set forth below. NOW, THEREFORE, IT IS AGREED AS FOLLOWS: SECTION 1. TERM OF CONTRACT 1.01. This Agreement will become effective on August 7, 2007, and will continue in effect until such time as the Services are complete and the City has received all project closeout documents, or until terminated as provided in this Agreement. SECTION 2. DEFINITION OF TERMS 2.01. Whenever used in the Agreement, the following terms shall mean: A. "Agreement" shall mean that formally executed Agreement or Contract which includes the Contract Documents attached. The Agreement constitutes the entire agreement between the parties relating to its subject matter. B. "City" shall mean the City of Vernon, California, the entity which has executed the Agreement and, where applicable, its affiliated companies, and its officers, directors, employees, representatives and agents. C. "Contractor" shall mean Combustion Science & Engineering, Inc. and where applicable, its affiliated companies, and its officers, directors, employees, representatives and agents. D. "Contract Documents" shall include any inquiry, invitation to bid, or proposal which may have, but not necessarily, preceded execution of the Agreement, and including the General Provisions and all exhibits and schedules attached to the Agreement and all plans and specifications identified in the Contract Documents. E. "Contract Price" shall mean the compensation set forth or provided for in Section 4.01 of this Agreement. Whether it expressly provides for the reimbursement of costs incurred by Contractor or simply for the payment of a lump sum of money, it is intended to be the full and complete payment for satisfactory completion of the Work and, unless otherwise stated, to cover all costs whether for materials, equipment, tools, labor, services and taxes and all overhead, rentals and profit or fee, if any. Page 2 of 20 F. "General Provisions or "General Conditions" shall mean the General Provisions as set forth in this Agreement. G. "Premises shall mean the physical premises under City's control or ownership where Work hereunder is to be performed. H. "Proprietary Information" and "Confidential Information" shall mean all -information, whether written or oral, which Contractor acquires from, through or on behalf of City, directly or indirectly, or which arises out of the Work, concerning the Work or proprietary processes involved in the Work including, without limitation, information concerning past, present or future business plans of City, information about the operations of City's Premises, and other City information or know-how obtained during the Work, except information falling into any of the following categories: 1. Information which, at the time of disclosure hereunder, is in the public domain; 2. Information which, after disclosure hereunder, enters the public domain, except where such entry is the result of Contractor's or any entity within Contractor's control breach of this Agreement; 3. Information which, prior to disclosure hereunder, was already in Contractor's possession without limitation regarding disclosure to others; or 4. Information which, subsequent to disclosure hereunder, is obtained by Contractor from a third party who is lawfully in possession of such information and not subject to a contractual or fiduciary relationship to City with respect to said information and who does not require Contractor to agree to refrain from disclosing such information to others. 1. "Subcontractor" shall mean any first or lower -tier subcontractor and its employees, representatives, agents, subcontractors or other personnel who have been approved in the manner required by this Agreement. - J. "Work" or "Services" shall mean the work performed by Contractor and required to be performed from time to time by City under this Agreement. Page 3 of 20 SECTION 3. SERVICES TO BE PERFORMED BY CONTRACTOR Specific Services 3.01. Contractor's Services shall include, but will not be limited to, conducting a study and preparing a report determining the impact of an Enhanced Turbine Output LLC Power Cool air supercharging system on Siemens SCC6-5000F Combustion Turbine pollutant emissions at baseload conditions at the proposed Vernon Power Plant Project. The Contractor's Services are more specifically detailed in the Proposal attached hereto as Exhibit "A." Change of Services 3.02. City may at any time, by written change order executed by the City, make changes only to extend the Work duration and total compensation of Contractor's Work. Only the City shall authorize changes in the scope of Work, or duties and obligations. 3.03. City may make "Changes by increasing, reducing or deviating from the requirements of the scope of Work. A form of Change Order is set forth in Exhibit B attached hereto and incorporated by reference. Timing of Services 3.04. Contractor's Services shall commence upon the execution of this Agreement by both parties and award by the City Council and shall end at such time as the Services are completed and the City receives all project close-out documents, unless this Agreement is otherwise terminated according to Section 6 of this Agreement or extended according to the conditions and terms set forth in this Agreement. 3.05. Time is of the essence for all Work contemplated by this Agreement. Contractor shall start performing Services under this Agreement only after notification by the City. Method of Performing Services 3.06. Contractor will determine and is responsible for the method, details, and means of performing the above -described Services. Page 4 of 20 Status of Contractor 3.07. Contractor enters into this Agreement, and will remain throughout the term of this Agreement, as an independent contractor. Contractor agrees that it is not and will not become an employee, partner, agent, or principal of City while this Agreement is in effect. Contractor agrees it is not entitled to the rights or benefits afforded to City's employees, including disability or unemployment insurance, workers' compensation, medical insurance, sick leave, or any other employment benefit. Contractor is responsible for providing, at its own expense, disability, unemployment, and other insurance, worker's compensation, training, permits, and licenses for itself and for its employees and subcontractors. Contractor shall have complete and sole control over its employees, the details of the Services and methods by which the Services are accomplished, it being understood that City is interested only in the results to be obtained by Contractor. 3.08. Contractor has no authority to enter contracts or agreements on behalf of City. This Agreement does not create a partnership or joint venture between the parties. Payment of Taxes 3.09. Contractor is responsible for paying when due all income taxes, including estimated taxes, incurred as a result of the compensation paid by City to the Contractor for Services under this Agreement. Contractor agrees to indemnify City for any claims, costs, losses, fees, penalties, interest, or damages suffered by City resulting from Contractor's failure to comply with this provision. 3.10. Payroll taxes including federal, state and local taxes shall not be withheld or paid by City on behalf of Contractor or for the employees of the Contractor. Contractor shall not be treated as an employee with respect to the Services performed hereunder for federal or state tax purposes. Contractor shall be responsible to pay taxes mandated by law. 3.11. Since Contractor is not an employee of City, Contractor is not eligible for and shall not participate in any employee benefit of City, including pension, health or other fringe benefits. SECTION 4. COMPENSATION 4.01. Inconsideration for the Services to be performed by Contractor, described in Section 3 of this Agreement, City agrees to pay Contractor according to the Proposal set forth in Exhibit A the not to exceed amount of Fifty Thousand Dollars and No Cents ($50,000,00), on a fixed cost basis (the "Contract Price"). Page 5 of 20 Entire Compensation 4.02. The Contract Price is full and complete compensation, and constitutes the entire compensation due Contractor for the Services and any and all of Contractor's obligations hereunder. The Contract Price set forth above is not subject to escalation for any reason except as expressly set forth in this Agreement. No adjustments in compensation shall be made as a result of changes in the value of any currency. The Contract Price shall only be adjusted by formal, written Change Order or amendment to this Agreement. Payment of Compensation 4.03. For Services rendered under Section 3 of this Agreement, Contractor shall be entitled to receive monthly payments. Contractor shall submit to City a monthly invoice and statement of Services, prepared in accordance with City requirements, by the fifteenth (15th) of each month, for the prior calendar month's completed Work. City will make payments to Contractor within thirty (30) days after acceptance and approval of the invoice received from Contractor. 4.04. Contractor shall be responsible for paying any subcontractors used in the performance of this Agreement. Subcontractors shall not bill the City directly. Expenses 4.05. City shall not be liable to Contractor for any expenses paid or incurred by Contractor. Expenses may only be billed if advance written approval has been obtained from the City. Compensation for Changes 4.06. The compensation due Contractor, or the credit due City, for changes may not be established verbally, and shall be established in a written change order signed by City as described in Sections 3.02 and 3.03 of this Agreement. Compensation adjustments in each such change order shall be established by one or more of the following bases, as determined by City: (a) a lump sum price to be negotiated between the parties; or (b) Work unit rates to be negotiated between the parties. Once established, the amount of the compensation due Contractor or credit due City for a change shall not be subject to adjustment for any reason, including changes in the value of any currency. Page 6 of 20 SECTION 5. OBLIGATIONS OF THE PARTIES 5.01. Contractor is responsible for meeting all conditions of this Agreement and City Standards & Details for all Work performed. Substandard Work, as determined solely by the City, shall be redone at the expense of the Contractor. Products of Consulting 5.02. All products of consulting services including, but not limited to, manuals, documents and/or computer software, shall become the property of the City and shall be delivered to the City before the end of the performance of this Agreement. Basic notes and sketches, charts, computations and other data shall be made available to City Without restriction or limitation on their use. Liability Insurance 5.03. Contractor and its subcontractor(s), if any, shall, prior to commencement of any Work and for the duration of this Agreement, obtain and maintain at its own expense, those minimum levels of insurance coverage as set forth below. Prior to commencing Work hereunder, Contractor shall provide the City with proof of insurance providing and maintaining the coverage and endorsements set forth below. Said proof of insurance shall also provide that said policy or policies shall not be canceled or materially reduced in coverage without giving at least thirty (30) days prior written notice to the City. 5.04. The insurance coverage as listed herein, shall be properly endorsed to include those contractual obligations which may be identified further within this Agreement and shall be endorsed to provide City all the rights and privileges of an additional insured. 5.05. Contractor shall cause its insurers to issue, including but not limited to, Certificates of Insurance or, upon request, certified copies of the insurance policies evidencing that the coverage and policy endorsements required under this Agreement, are maintained in force. 5.06. Contractor shall ensure its subcontractor(s), if any, maintain those insurance requirements as specified in this Agreement and are endorsed as additional insured(s) on all required Contractor insurance coverage. Contractor and its subcontractor(s), if any, shall maintain in effect the following minimum insurance ,coverage on an Occurrence Form Policy: Workers Compensation within the statutory limits, including occupational illness or disease coverage in accordance with the laws of the nation, Page 7 of 20 state, territory, or province exercising jurisdiction over Contractor's employees. Workers Compensation and Employers Liability Insurance shall have a minimum limit of $1,000,000 per occurrence. Contractor further agrees to hold harmless and indemnify City for any and all claims arising out of an injury, disability, or death of any of Contractor's employees or agents. 2. Comprehensive General Liability Insurance, including, but not limited to, Contractual Liability, Products and Completed Operations Liability, Broad Form Property Damage and Bodily Injury Liability, and Explosion, Collapse and Underground Liability, with a minimum combined single limit of $2,000,000 per occurrence. 3. Comprehensive Automobile Insurance, including, but not limited to, all owned, non -owned or hired vehicles with a minimum combined single limit of $1,000,000 per occurrence for bodily injury and property damage. 4. Excess Liability Insurance with limits of $2,000,000. Such evidence of insurance can either be through the primary insurance coverage or through an excess policy. Such insurance shall at all times be on an occurrence form and provide policy conditions as broad as those required in the primary insurance. 5. Professional Liability Insurance with limits of $2,000,000. 5.07. Contractor agrees to provide insurance in the amounts and forms specified above. Contractor shall submit to the City documentation indicating compliance with these minimum requirements no less than one (1) day prior to the beginning of performance under this Agreement. Contractor shall not commence performance of its Work under this Agreement until the above insurance has been obtained and proof of insurance has been filed with and approved by the City. 5.08. Contractor shall not permit a subcontractor or vendor to perform work on City premises unless and until a certificate of insurance is obtained showing that such subcontractor or vendor has worker's compensation coverage. If Contractor employs subcontractors as part of the Services rendered, Contractor's protective coverage is required. Contractor may include all subcontractors as insureds under its own policy or shall furnish separate insurance for each subcontractor, meeting the requirements set forth above. Page 8 of 20 Representations 5.09. To the fullest extent permitted by law, Contractor shall defend, indemnify and hold harmless City and its elected officials, officers, agents and employees from all claims, suits, actions, demands, damages, liabilities; expenses, judgments, settlements, and penalties, losses, fines, and all costs and expenses incurred in connection therewith, including reasonable attorney's fees and all costs of defense, to the extent arising out of or attributable to the negligent or wrongful acts of Contractor or its employees or agents under this Agreement, except to the extent arising from or caused by the sole negligence or willful misconduct of the City, its officers, agents or employees. The terms of this indemnity shall survive the termination of this Agreement. The obligations in this Paragraph are in addition to Contractor's duty to provide insurance and shall not be limited by any limitation on the amount or type of insurance coverage carried by Contractor. 5.10. Contractor and City represent that each has read and understands the Agreement and Contract Documents. The Contractor represents it understands the City's regulations concerning Premises access, badges, parking, security, safety, fire, prohibited drugs and alcohol, and smoking and other rules, and that Contractor has visited Premises where the Work is to be done and is familiar with the local conditions under which it is to be done. Contractor also represents that it is experienced in performing and competent and qualified to perform the kind of tasks or assignments included in the Work and employs or has available for employment in sufficient numbers all unskilled, skilled, administrative, supervisory, professional and managerial or other personnel required to perform the Work as required by this Agreement. 5.11. Contractor represents that it has the qualifications and skills necessary to perform the Services under this Agreement in a competent, professional manner, without the advice or direction of City. This means Contractor is able to fulfill the requirements of this Agreement. Failure to perform all the Services required under this Agreement constitutes a material breach of the Agreement. Contractor has complete and sole discretion for the manner in which the Work under this Agreement will be performed. 5.12. Contractor declares and states that is has complied with and will continue to comply with all federal, state and local laws regarding business permits and licenses that may be required to carry out the Services to be performed under this Agreement. 5.13. Contractor agrees to indemnify, defend, and hold City free and harmless from all claims, demands, losses, costs, expenses, obligations, liabilities, damages, recoveries and deficiencies, including interest, penalties, attorney's fees and Page 9 of 20 costs, that City may incur as a result of a breach by Contractor of any representation or provision contained in this Agreement or any negligent or intentional acts or omissions by Contractor, it subcontractors, agents, and employees or based on any claim that any software program or other product used or furnished by Contractor in the performance of this Agreement constitutes an infringementofany United States patent or copyright. 5.14. Contractor's rights under this Agreement may not be assigned nor may its duties be delegated or subcontracted without the prior written consent of City. Any assignment or delegation or subcontract in violation of this Section shall, at City's sole discretion, be void. Consent by City shall not relieve Contractor of responsibility for performance of Contractor's obligations hereunder. City may assign all or any part of this Agreement at any time effective immediately upon written notification to Contractor. 5.15. At all times while Work is being performed on the Premises each party shall be represented thereon by a designated representative. Each parry may notify the other in writing of the identity of such persons from time to time. Work Injury 5.16. The treatment and care of injuries sustained by Contractor's employees, subcontractors, representatives or other personnel shall be and remain the responsibility of Contractor. City's first aid facilities, if any, however, will be made available to Contractor's employees in emergency cases that are the direct result of accidents occurring on the Premises. City shall incur no liability for, and Contractor hereby agrees to indemnify City against, any causes of action, claim, liability or costs, including attorney's fees, arising in whole or part out of the furnishing of such first aid facilities or assistance to Contractor's employees, subcontractors, representatives or other personnel, or out of the failure to furnish such facilities or assistance. Records, Inspection and Audit 5.17. During the course of Work being performed, Contractor and any of its subcontractors, shall maintain and retain, not less than three (3) years after completion thereof, complete and accurate records of the Contractor's costs which are chargeable to the City under this Agreement. City or its designated, authorized representatives shall have the right during this three (3) year period, upon written reasonable notice, to inspect and audit those records. Such records to be maintained and retained by the Contractor shall include: (a) payroll record accounting for the total time distribution of the Contractor's employees working full or part time on the Work (to permit tracing to payroll payments in cash); (b) Page 10 of 20 Q invoices for purchases, receiving and issuing documents, and all the other unit - inventory records for the Contractor's stores, stock or capital items; (c) paid invoices and canceled checks for material purchased and for the subcontractor's and any other third parties' charges; and (d) any other documentation City deems necessary to support costs and charges under this Agreement. Corporate Conduct 5.18. Contractor, its employees, agents or representatives shall not offer or give to an officer, official or employee of City gifts, entertainment, payments, loans or other gratuities to influence the award of a contract or obtain favorable treatment under this Agreement or any other contract. Standard of Care 5.19, Contractor agrees that all Services provided will be conducted by the principal and competent staff members, if any, under the supervision of the principal, and that Services will be performed and rendered diligently. Contractor represents that it has, or shall secure, at its own expense, all personnel required to perform Contractor's Services under this Agreement, but at all times shall be responsible for the Services of such personnel Contractor may not employ any subcontractor without the prior written approval of the City. Indemnity Process 5.20. The City shall notify Contractor in writing of any suits, claims or demands covered by any indemnity contained in this Agreement. Promptly after receipt of such notice, Contractor shall assume the defense of such claim with counsel reasonably satisfactory to City. If Contractor fails, within a reasonable time after receipt of such notice, to assume the defense with counsel reasonably satisfactory to City, or if, in the reasonable judgment of City, a direct or indirect conflict of interest exists between the parties with respect to the claim, or if in the sole judgment of City the assumption and conduct of the defense by Contractor would materially and adversely affect City in any manner or prejudice its ability to conduct a successful defense, then the City shall have the right to undertake the defense, compromise and settlement of such claim for the account and at the expense of Contractor. Notwithstanding the above, if the City in its sole discretion so elects, City may also participate in the defense of such actions by employing counsel at its expense, without waiving the Contractor's obligations to indemnify or defend. Contractor shall not settle or compromise any claim or consent to the entry of any judgment without the prior written consent of the City and without an unconditional release of all liability by each claimant or plaintiff to the City. Page 11 of 20 Treatment of Confidential and Proprietary Information 5.21. For ten (10) years after the effective date of this Agreement, Contractor shall refrain from using any Confidential or Proprietary Information except in connection with the Work or from disclosing it to any third party other than to employees of Contractor who require it in performance of the Work and except to such other third persons as City may authorize in writing. If disclosure to such an employee or to other third persons is so authorized, Contractor shall enter into with said party a confidentiality agreement containing provisions with respect to use and disclosure of Proprietary Information substantially the same as those contained in this Agreement. 5.22. Contractor shall take reasonable precautions to safeguard any documents containing Proprietary Information that City may supply to Contractor hereunder. Contractor may copy, in whole or part, such documents to the extent necessary for the performance of the Work, and Contractor shall return to City upon the completion of the Work or request by City all such documents and copies. 5.23. Except as expressly permitted by prior written consent of the City, Contractor and/or its subcontractors shall not disclose, permit the disclosure of, release, disseminate, or transfer, whether orally or by any other means, any part of such Confidential Information to any other person or entity. Contractor and/or its subcontractors shall return any written Confidential Information and all copies made of such items to the City upon the City's written request, but in any event not later than the date that Contractor has performed all Work to be performed pursuant to this Agreement. Contractor hereby agrees that such Confidential Information and any documents provided may be used by Contractor and/or its subcontractors only as authorized by the City. Contractor shall include a provision in its agreements with subcontractors that bind the subcontractors to this non -disclosure requirement. 5.24. All reports, plans, data, studies, maps, drawings, models, photographs, documents and other writings prepared by and for Contractor, its officers, employees, agents and subcontractors in the course of implementing this Agreement, with the exception of working notes, internal documents and Confidential Information provided by businesses located in City, shall be considered the property of City. Contractor shall deliver such documents and materials to the City as they are generated; however, Contractor may take and retain copies of said documents and materials that are not Confidential Information, as desired. 5.25. All reports, information, data and exhibits prepared or assembled by Contractor in connection with the performance of its Services pursuant to this Agreement Page 12 of 20 are confidential until released by the City to the public and Contractor agrees that such documents shall not be available to any individual or organization without the written consent of the City prior to such release. 5.26. No reports, maps, or other documents produced in whole or in part under this Agreement shall be the subject of an application for copyright by or on behalf of Contractor. Compliance with Authority 5.27. Contractor shall comply with all laws, regulations, executive orders and other applicable requirements of any governmental agencies having jurisdiction including the Fair labor Standards Act, the Occupational Safety and Health Act and all those relating in any way to employment practices and protection of the environment. Contractor shall not discriminate against any employee or any applicant for employment for reasons of race, color, creed, religion, sex, sexual preference, age or national origin. 5.28. Contractor shall make timely payment of all employment taxes and of all social security and other contributions of every kind required to be made with respect to or measured by the wages and salaries of persons employed by Contractor. 5.29. Contractor shall indemnify City against, and hold City harmless from, any liability or loss including liability or loss from fines or penalties arising out of Contractor's failure to perform the obligations imposed upon it by Sections 5.27 and 5.28 of the Agreement. Progress Reports 5.30. Contractor shall meet with City staff, upon City's request, or as needed, in order to provide reports or information concerning the Services being performed by Contractor under this Agreement. Contractor's License Classification 5.31. Contractor shall possess all appropriate licenses for the duration of this Agreement. City Provided Data and Services 5.32. The City shall furnish the Contractor available studies, reports and other data pertinent to Contractor's Services; obtain or authorize Contractor to obtain or provide additional reports and data as required; furnish to Contractor services of Page 13 of 20 others required for the performance of Contractor's Services hereunder, and Contractor shall be entitled to use and rely upon all such information and services provided by the City in performing Contractor's Services under this Agreement. 5.33. The Contractor has no control over the cost of labor, materials, equipment or services furnished by others, or over equipment vendors' or construction contractors' methods of determining prices, or other competitive bidding or market conditions, practices or bidding strategies. Cost estimates are based on the Contractor's opinion based on experience and judgment. Contractor cannot and does not guarantee that proposals, bids or actual Project construction costs will not vary from cost estimates prepared by Contractor. SECTION 6. TERMINATION OF AGREEMENT 6.01. Unless otherwise terminated as provided in this Section, this Agreement will continue in effect until such time as report is complete and the City receives all project close-out documents, unless otherwise extended according to the terms and conditions set forth in this Agreement. Non -Default Termination 6.02. City, at its sole discretion, may terminate this Agreement upon thirty (30) days written notice to Contractor and such termination shall be effective in the manner specified in such notice and shall be without prejudice to any claim that either party may have against the other. During the thirty (30) day period after such notice is sent, the parties shall continue to act toward each other in good faith. 6.03. In the event of any such termination, in full and complete settlement for the termination of the Work, City shall pay Contractor for those Services performed prior to the date of delivery of the termination notice, plus compensation for (i) necessary Work performed during the notice period and authorized in the termination notice, and (ii) all costs reasonably and necessarily incurred by Contractor directly attributable to termination which could not reasonably have been avoided and for which Contractor is not otherwise compensated that are incurred through the date of termination and effectuating the termination ("Termination Expenses"). Termination Expenses shall not include lost profits, lost opportunities, consequential damages, or the like. In no event shall total payment exceed the Contract Price. Termination on Occurrence of Stated Events 6.04. This Agreement will terminate automatically on the occurrence of any of the Page 14 of 20 following events: A. Bankruptcy or insolvency of either party; or B. Sale of the Contractor; or C. Assignment of this Agreement by Contractor without City's written consent. Termination for Default 6.05. If Contractor defaults in the performance of this Agreement or materially breaches any of its provisions, City may immediately terminate this Agreement by giving written notification to Contractor indicating the effective date of such termination. Termination will take effect immediately upon the date specified in the notification. For the purposes of this paragraph, material breach of this Agreement includes, but is not limited to, the following: A. Contractor's failure to perform, in a manner satisfactory to the City in its sole discretion, the Services specified in Section 3 of this Agreement; or B. Contractor's material breach of any obligation or provision contained in Section 5 of this Agreement. 6.06. The waiver by either party of a breach or default by the other party shall not be deemed a waiver of any different or later breach; nor shall any delay or omission by either party to exercise any right it may have hereunder operate as a waiver of any breach or default of such a right. The failure of either party to this Agreement to exercise any of its rights under this Agreement does not constitute a breach thereof and shall not be deemed to be a waiver of such rights or a waiver of any subsequent breach. 6.07. In the event of any termination of this Agreement or reduction in the scope of the Work, Contractor shall not be entitled to damages for loss of profits for the unexecuted portion of the Work or any other damages because of such termination or reduction. Page 15 of 20 SECTION 7. GENERAL PROVISIONS Notices 7.01. All notices, approvals, consents and other communications between the parties shall be in writing, and shall be sent by fax or by certified mail (return receipt requested) to the respective addresses set forth below, or at such other address as may be furnished by either party to the other in writing. Faxed notices, confirmed by copy thereof, shall be deemed communicated as of the day the facsimile was sent. Mailed notices will be deemed communicated as of the day of receipt or the third (3rd) day after mailing, whichever occurs first. Contractor - City - City of Vernon Combustion Science & Attn: City Administrator Engineering, Inc. 4305 Santa Fe Avenue Attn: Michael S. Klassen Vernon, CA 90058 8940 Old Annapolis Road, Suite L Columbia, MD 21045-2129 Fax: 410-884-3267 Fax: 323-826-1438 Telephone: 410-884-3266 Telephone: 323-583-8811 Copy to: Vernon City Hall Attn: Director of Light & Power 4305 Santa Fe Avenue Vernon, CA 90058 All invoices shall be mailed via U.S. Postal Service to the following address: Vernon City Hall Attn: Office of the Treasurer/Light &Power 4305 Santa Fe Avenue Vernon, CA 90058 Entire Agreement of the Parties 7.02. This Agreement supersedes any and all agreements, either oral or written, between the parties with respect to the rendering of Services by Contractor for City and contains all of the representations, covenants, and agreements between Page 16 of 20 the parties with respect to the subject matter of this Agreement and the rendering of those Services. Each party to this Agreement acknowledges that no representations, inducements, promises, or agreements, orally or otherwise, have been made by any party, or anyone acting on behalf of any party, which are not contained in this Agreement, and that no other agreement, statement, or promise not contained in this Agreement or a subsequent amendment or change order shall be valid or binding. No amendment or change in the provisions of this Agreement shall be made, except in a formal written amendment signed by Contractor and an authorized representative of the City, or in a written change order. Contractor expressly waives all claims for compensation based upon quantum meruit, implied contract or oral contract. Each party represents and warrants that it has read and fully familiarized itself with this Agreement, and that such party has been fully authorized to sign this Agreement. 7.03. This Agreement shall be comprised of these included provisions, together with Exhibits A and B, which are all attached. In the event of conflict between this Agreement and any of the exhibits, including the Proposal, this Agreement shall prevail. Partial Invalidity 7.04. If any provision of this Agreement is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remaining provisions will continue in full force and effect without being impaired or invalidated in any way. Law and Arbitration 7.05. All disputes arising out of or related to this Agreement, the conduct of either party in connection with this Agreement, and the relationship and rights of the parties in connection with this Agreement, whether characterized as breach of contract, tort, or otherwise (except for those requesting injunctive relief) shall be determined by binding arbitration in accordance with the terms of this Section. The submittal of all matters to arbitration in accordance with the terms of this Section is the sole and exclusive method, means and procedure to resolve any and all claims, disputes or disagreements arising under this Agreement, except for claims by either party which seek injunctive relief, which claims shall be resolved by suit filed in the Superior Court of Los Angeles County, California, the decision of which court shall be subject to appeal pursuant to applicable law. The parties hereby irrevocably waive any and all rights to the contrary and shall at all times conduct themselves in accordance with the terms of this Section, relying on arbitration as the sole means of resolution of disputes. Arbitration of all matters required to be arbitrated hereunder shall take place before a panel of three retired judges of the Superior Court of the State of California (the Page 17 of 20 "Arbitrators") under the auspices of Judicial Arbitration & Mediation Services, Inc. ("JAMS"). Such arbitration shall be initiated by the parties, or either of them, within ten (10) calendar days after either party sends notice of a demand to arbitrate (the "Arbitration Notice") to the other party and to JAMS. The Arbitration Notice shall contain a description of the subject matter of the arbitration, the dispute with respect thereto, the amount involved, if any, and the remedy or determination sought. Each party shall select a retired judge from the JAMS panel, and the two selected judges shall mutually agree on the third retired judge from the JAMS panel. If one of the parties does not select a retired judge from the JAMS panel within fourteen (14) calendar days after receipt of the Arbitration Notice, JAMS will select the second judge, and the judge selected by JAMS and the judge selected by the other party will select the third judge for the panel. The third judge is to be selected within ten (10) calendar days following the selection of the first two judges. The three judges will together serve as the Arbitrators. The arbitration shall be conducted in Los Angeles, California. Any party may be represented by counsel and/or other authorized representative. In rendering a decision(s), the Arbitrators shall determine the rights and obligations of the parties according to the substantive and procedural laws of the State of California and the terms of this Agreement. The decision of the Arbitrators shall be based on the evidence introduced at the hearing and accompanied by a written statement of decision as to each of the principal controverted issues. The agreement of two of the three Arbitrators as to the resolution of the dispute shall be a conclusive resolution. The Arbitrators shall deliver the written decision to the parties within thirty (30) calendar days following the date of the selection of the last of the Arbitrators. The decision shall be conclusive and binding, and it may thereafter be confirmed as a judgment by the Superior Court of the State of California, subject only to challenge on the grounds set forth in the California Code of Civil Procedure Section 1286.2. The validity and enforceability of the decision of the Arbitrators is to be determined exclusively by the California courts. Attorney's Fees 7.06. In the event a dispute, claim or litigation arises regarding this Agreement, the prevailing party shall be entitled to reimbursement for reasonable attorneys' fees and actual costs, which may be set by the arbitrators or the court in the same action or in a separate action brought for that purpose, in addition to any other relief which is obtained. 7.07. Neither party shall be considered in default in any of its obligations under this Agreement when a failure of performance shall be due to an uncontrollable force The term "uncontrollable force" shall mean any cause beyond the control of the party affected, including, but not restricted to, flood, earthquake, storm, fire, Page 18 of 20 lightning, epidemic, war, riot, civil disturbance or disobedience, federal, state, or municipal action, statute, ordinance, or regulation, embargoes of the United States Government or any other government, which by exercise of due diligence such party could not reasonably have been expected to avoid and by exercise of due diligence has been unable to overcome. Either party rendered unable to fulfill any of its obligations under this Agreement by reason of an uncontrollable force shall give written notice within five (5) business days of such fact to the other party and shall exercise due diligence to remove such inability with all reasonable dispatch. 7.08. Except as may otherwise be specifically provided herein, this Agreement may be modified or amended only by a written document executed by both Contractor and the City and approved as to form by the City Attorney. 7.09. The captions used in this Agreement are for convenience only and shall in no way define, limit, or describe the scope or intent of the Agreement or any part thereof. Page 19 of 20 7.10. City reserves the right to award similar contracts to multiple contractors to ensure the City has adequate services. IN WITNESS WHEREOF, the parties have executed the Agreement on the dates shown below. City: City of Vernon Name: Title: Date: ATTEST: APPROVED AS TO FORM: Manuela Giron Jeff A. Harrison City Clerk City Attorney Contractor: Combustion Science & Engineering, Inc. Name: Title: Date: Name Title: Date: Page 20 of 20 1 4 11 Combustion Science & Engineering, Inc. 8940 Old Annapolis Road • Suite L • Columbia • MD * 21045 -2129 • Tel: 410 / 884-3266 • Fax: 410 / 884-3267 Proposal to Characterize the Effect of ETO's PowerCoolrm System on Turbine Emissions Combustion Science & Engineering, Inc. (CSE) proposes to conduct a study to determine the impact of ETD's PowerCoolTM air supercharging system on gas turbine pollutant emissions at baseload conditions. The premise of the PowerCoolTM system is to maximize the mass flow rate through the turbine at all atmospheric conditions (Temperature and Pressure). The PowerCoolTM system offsets the compressive heating of the air through water injectionand droplet evaporation. This study will highlight the effects on combustor performance when maintaining total power from the turbine by reducing combustor heat release but increasing the mass flow rate of air through the turbine. This study will utilize combustor inlet conditions similar to that of a non -piloted, large frame turbine such as the Siemens SGTG-5000 (W501F). A general methodology will be developed that can be used to analyze other combustion systems as well. A detailed kinetic analysis will be performed using a full chemical kinetic mechanism and a one-dimensional computer code. The use of a simplified flow model is necessary in order to incorporate the more complete reaction mechanisms needed to accurately study pollutant emissions in the combustor. The combustor will be simulated through the use of chemical reactor modeling (CRM). The CRM approach has also been used effectively by various authors [1, 2, 3] to model the combustion zone of a gas turbine engine (GTE). This approach generally assumes that the primary zone of a gas turbine combustor can be modeled as a PSR, and the dilution zone can be modeled as a PFR. These simplified fluid mechanic constructs allow for accurate solution of detailed kinetics mechanisms that typically include tens of species and hundreds of reactions. By passing the output from one reactor to the input of another reactor, the movement of the reacting flow through the combustor can be simulated while maintaining the ability to solve for detailed time -concentration histories of a large number of major and minor species including CO, NOx, and UHCs. These detailed mechanisms provide accurate species concentration predictions over a wide range of fuel -air equivalence ratios. The June 22, 2007 Confidential and Proprietary Combustion Science & Engineering, Inc. major drawback of this approach is that it simplifies the fluid mechanics of the combustor. This analysis will utilize several programs developed by Sandia National Laboratory: Perfectly Stirred Reactor (PSR)4, SENKINS and CHEMKIN6. The well - validated GRI reaction mechanism' (GRI 3.0) for natural gas (which incorporates over 200 reactions and over 50 species) will be used in this analysis. The CRM model will be used to obtain baseline (i.e. without the PowerCoolTM system) pollutant emissions from the simulated gas turbine combustor. Combustor performance will then be assessed with the addition of the PowerCoolTM system. The ability of the mass flow augmentation system to reduce pollutant emissions while maintaining.`baseline' power output will also be assessed. CSE will also investigate a range of water loadings within the additional airflow from the PowerCoolTM system. The study will be conducted in two parts. The initial portion (Part 1) will focus on assessing the impact of the PowerCoolTM system on gas turbine performance. The scope of the initial portion of the study will include: • Baseline combustor performance. A CRM network will be developed that effectively models the performance of a large frame gas turbine combustor. Pollutant emissions of the CRM model will be assessed for base load conditions. This data will provide the baseline performance to which the model with the mass flow rate augmentation can be compared. • Combustor performance with the PowerCoolTM system at conditions for maximum power output. The input parameters for the CRM network will be modified to include the mass flow rate augmentation from the PowerCoolTM system at conditions designed to maximize power output. Pollutant emissions of the CRM model will be assessed for these conditions and compared to the baseline combustor performance. • Combustor performance with the PowerCoolTM system at conditions when baseline combustor power maintained. The input parameters for the CRM network will be modified to include the mass flow rate augmentation from the PowerCoolTM system at conditions designed to maintain the combustor output at baseline levels. This study will investigate the possibility of lowering combustor firing temperature by June 22, 2007 Confidential and Proprietary Combustion Science & Engineering, Inc. using mass flow rate augmentation to maintain combustor power output. Pollutant emissions of the CRM model will be assessed for these conditions and compared to the baseline combustor performance. • Combustor performance with the PowerCoolTM system with a range of water loadings in augmentation airflow. Water loadings of 25% 50%, and 75% of that designed for maximum power output in the augmentation airflow will be assessed as to their impact on combustor performance (pollutant emissions). These results will be compared to baseline combustor performance as well as combustor performance with the PowerCoolTM system parameters designed for maximum power output. • The GateCycle software program will be used to model a Siemens SGT6-5000F (formerly Siemens Westinghouse 501F) gas turbine in simple cycle operation to predict the performance enhancement provided when using the PowerCoolTM system. Initially, three ambient temperature conditions will be considered. For each ambient temperature, calculations will be made for inlet fogging to reduce the gas turbine inlet temperature to within 2 F of the wet bulb temperature and for inlet fogging to reduce the temperature to within 5 F of the wet bulb temperature. Additional conditions (up to 6 cases) will be also be run, using the same gas turbine model but at different ambient conditions and inlet fogging levels. The second portion of the analysis will serve to conduct more detailed analysis of the impact of the PowerCoolTM system. The scope of this work will be determined after the initial results are presented to the client and will be guided by client needs and questions. It is anticipated that a compressor expert will be used in the later analysis to determine the impact of the PowerCoolTM system on compressor performance. ETO Supplied Information ETO will be required to provide inlet conditions for combustion system. This will include pressure, temperature, mass flow rates and concentration of water in the augmentation flow. Furthermore, ETO will provide the input conditions to conduct the GateCycle analysis (environmental conditions, gas turbine model, compressor shaft limits June 22, 2007 Confidential and Proprietary Combustion Science & Engineering, Inc. etc). CSE will provide a detailed list of the necessary inputs. If ETO can not provide all the inputs, literature values and/or engineering estimates will be utilized. Corporate Capabilities and Key Personnel CSE's team includes degrees in Chemistry, and Chemical, Mechanical, and Fire Protection Engineering, offering its clients more than one hundred years of combined experience in research, development, design, and analysis of a wide array of problems in combustion science. Dr. Michael Klassen will be the lead engineer on this proposed project. Dr. Ponnuthurai Gokulakrishnan and Mr. Diwakar Vashishat will be the other engineers as required. Dr. Leo Eskin will lead the effort to model the overall cycle using GateCycle. A brief description of the key personnel is given below. Resumes are provided at the end of this proposal. Michael S. Klassen, Ph.D., P.E., (Mechanical Engineering) has worked at CSE since the inception of the company serving as a Principal Research Engineer. Dr. Klassen has over fifteen years of experimental fire and combustion research experience. During his tenure at CSE, Dr. Klassen has heavily involved in development of reduced mechanisms and application of chemical kinetic studies to gas turbine related problems. Dr. Klassen has spent much of his career conducting research at the University of Maryland and Purdue University where his projects included the development of laser and optical diagnostic techniques, the investigation of the effects of high pressure on NO formation in flames, and the study of radiation properties and flame structure of liquid fuel pool flames. He also served as Guest Researcher for the National Institute of Standards and Technology —Center for Building and Fire Research, and the Fire Research Institute — Department of Home Ministry in Tokyo, Japan. Prior to forming CSE, Dr. Klassen worked for Hughes Associates, Inc. where he was responsible for conducting large-scale fire tests, fire modeling, characterizing fire suppression systems involving flashing liquids (i.e. two-phase flow), and supporting fire litigation. Ponnuthurai (Gokul) Gokulakrishnan, Ph.D. (Chemical Engineering) has extensive experience in applied combustion chemistry related to practical combustion systems such as Low-NOx burners and internal combustion engines. Before joining CSE, Inc. as a June 22, 2007 Confidential and Proprietary Combustion Science & Engineering, Inc. Senior Engineer, Dr. Gokulakrishnan was an NSERC Post -doctoral Fellow at Princeton University engaged in experimental and computational study of developing reduced kinetic mechanism for gasoline oxidation pertaining to internal combustion engines. He also studied the effect of product gas entrainment on NOx formation in Low-NOx burners employed in natural -gas -fired industrial gas furnaces for his doctorate thesis. His Master's thesis project was on the effect of chlorine on NOx formation in fluidized bed combustors related to coal combustion. Leo D. Eskin, Ph.D., (Mechanical Engineering) has over twenty years of experience modeling gas turbine systems, combined cycle power plants, and integrated gasification combined cycle (IGCC) power plants. Before joining CSE, Inc., Dr. Eskin was one of the original owners of Enter Software, Inc, where he was a key developer of the GateCycle power plant modeling software, and the EfficiencyMap gas turbine performance modeling and data acquisition software. Dr. Eskin also has a broad background in the field of nuclear power, and was responsible for providing the nuclear enhancements to GateCycle to model the nuclear steam supply system (NSSS) and high moisture nuclear steam turbines. Dr. Eskin also once held a Senior Reactor Operator's License. Cost The total budget for the proposed study is $50,000 on a fixed cost basis. Part I of the study will cost $25,000. Part II includes $10,000 for work of the compressor expert, with the remaining funds used to answer specific questions raised after Part I. The results of the Part I of the study will be delivered in a final report no later than two months after final acceptance of the proposal. The delivery date of Part II of the analysis will be determined after the scope of that work is established. The following billing rates are used in this work: Principal Engineer: $140/hr Senior Engineer: $125/hr June 22, 2007 Confidential and Proprietary Combustion Science & Engineering, Inc. Project Engineer: $110/hr Staff Engineer: $95/hr The costs detailed in this proposal will be valid for one month. The contracted services may be canceled or terminated at any time by either ETO or CSE by the giving of seven days prior written notice. CSE reserves the right to assign personnel on an "as available" basis. This work will be billed on a monthly basis. CSE invoices are due upon receipt. Accounts unpaid for 30 days from the date of invoice are subject to a 1.5 percent per month service charge. Accounts unpaid for 60 days from the date of invoice will be a cause for CSE to suspend all performance under this Agreement upon a 14 day written notice unless payment in full is received within 14 days from the date of the written notice. In the event of a suspension of services, CSE shall have no liability for any delay or other damage, contractual or otherwise, caused by or arising out of the suspension of services of nonpayment. Acceptance by CSE of any payment more than 120 days old shall not serve as a waiver of CSE's contractual right to suspend service for nonpayment. REFERENCES 1. Rizk, N. K. and Mongia, H. C. "A Semi -Analytical Emission Model for Diffusion Flame, Rich/Lean, And Premixed Lean Combustors." Paper No. 93-GT-128, ASME/IGTI Turbo Expo, Cincinnati, Ohio, 1993. 2. Rizk, N. K. and Mongia, H. C. "Evaluation of Emission Model for Diffusion Flame, Rich/Lean, and Premixed Lean Combustors." Paper No. 93-GT-165, ASME/IGTI Turbo Expo, Cincinnati, Ohio, 1993. 3. Tonouchi, J. H., Held, T. J. and Mongia, H.C. "A Semi -Analytical Finite Rate Two - Reactor Model for Gas Turbine Combustors." Paper No. 97-GT-126, ASME/IGTI Turbo Expo, Orlando, Florida,1997. 4. Glarborg, P., Kee, R. J., Grcar, J. F., and Miller, J.A., PSR: A FORTRAN Program for Modeling Well -Stirred Reactors, Sandia National Laboratories, SAND86-8209, 1986. June 22, 2007 Confidential and Proprietary Combustion Science & Engineering, Inc. 5. Lutz, A. E., Kee, R. J., and Miller, J. A., SENKIN: A FORTRAN Program for Predicting Homogeneous Gas Phase Chemical Kinetics with Sensitivity Analysis, Sandia National Laboratories, SAND87-8248, 1987. 6. Kee, R. J., Miller, J. A., and Jefferson, T. H., CHEMKIN: A General -Purpose Problem -Independent, Transportable, Fortran Chemical Kinetics Code Package, Sandia National Laboratories, SAND80-8003, 1980. 7. GRI Mechanism 3.0, WWW site: http://www.gri.com/, 1995. June 22, 2007 Confidential and Proprietary Combustion Science & Engineering, Inc. EXHIBIT B Form Change Order CHANGE Contract Number: Change Number: The requirements of the above designated Agreement are changed as follows: City and Combustion Science agree that Combustion Science's compensation shall be adjusted as follows: City and Combustion Science agree that Combustion Science's schedule shall be adjusted as follows: This adjustment covers the entire compensation for the Change set forth above and includes, but is not limited to compensation for all engineering, material, equipment, subcontracts, labor, overhead, profit, changes in scheduling and delays resulting, directly or indirectly, from the Change, as further detailed in the Agreement. Combustion Science & Engineering, Inc. City of Vernon By By Date Date IM INSTRUCTIONS TO COMBUSTION SCIENCE & ENGINEERING, INC. Contract Number: Instruction to Combustion Science Number: Date: Specific Instructions to Combustion Science: In accordance with the Terms and Conditions of the Agreement, the City classifies these instructions as: Supplementary instructions, not involving a Change (Should these instructions be, in the opinion of Combustion Science, a "Change", written notice thereof must be given to City within 10 days of the receipt of these instructions. If such written notice is given, Combustion Science shall not commence with the work so ordered until written agreement is reached on the classification of these instructions and on the resulting adjustment in contract compensation, if any.) In the event that City and Combustion Science fail to agree on the classification of these instructions or resulting adjustment in contract compensation, if any, refer to the Changes Section of the Agreement. A Change (Combustion Science shall, within 10 days of the receipt of these instructions, furnish City a statement of its proposal for adjustment in contract compensation occasioned hereby. Combustion Science shall not commence with the work so ordered until written agreement is reached on the resulting adjustment in contract compensation, if any.) In the event that City and Combustion Science fail to agree on the classification of these instructions or resulting adjustments in contract compensation, if any, refer to the Changes Sections of the Agreement. City Representative Date Please acknowledge receipt of this instruction by returning one copy signed in the space provided below. Combustion Science's signature hereon does not indicate his acceptance of the classification assigned hereto by City. Combustion Science's Representative Date SUPPORTING DOCUMENTS SERVICES AGREEMENT THIS AGREEMENT is made, entered into and executed in duplicate originals, either copy of which may be considered and used as the original hereof for all purposes, as of this 6t" day of August, 2007, in the City of Vernon, County of Los Angeles, California BY AND BETWEEN THE CITY OF VERNON, a municipal corporation, hereinafter referred to as the "City," 4305 Santa Fe Avenue Vernon, California 90058 AND COMBUSTION SCIENCE & ENGINEERING, INC., hereinafter referred as "Contractor," 8940 Old Annapolis Road, Suite L Columbia, MD 21045-2129 RECITALS WHEREAS, the City desires to retain the services of an independent contractor to conduct a study and prepare a report determining the impact of an Enhanced Turbine Output LLC Power Cool air supercharging system on Siemens SCC6-5000F Combustion Turbine pollutant emissions at baseload conditions at the proposed Vernon Power Plant Project (the "Services"); and WHEREAS, Contractor has prepared a scope and fee proposal dated June 22, 2007, for the Services, a copy of which is attached hereto as Exhibit A and incorporated by this reference (the "Proposal"); and WHEREAS, Contractor represents that it is qualified and capable of furnishing the labor, materials and expertise necessary to perform the Services that the City requires, as set forth in this Agreement, and is willing to do so on the terms and conditions set forth below; and WHEREAS, the Contractor's cost proposal is acceptable to the City; and Page 1 of 20 WHEREAS, the City desires to enter into an agreement with Contractor to perform the Services on a contractual basis as defined in the terms and conditions set forth below. NOW, THEREFORE, IT IS AGREED AS FOLLOWS: SECTION 1. TERM OF CONTRACT 1.01. This Agreement will become effective on August 7, 2007, and will continue in effect until such time as the Services are complete and the City has received all project closeout documents, or until terminated as provided in this Agreement. SECTION 2. DEFINITION OF TERMS 2.01 Whenever used in the Agreement, the following terms shall mean: A. "Agreement" shall mean that formally executed Agreement or Contract which includes the Contract Documents attached. The Agreement constitutes the entire agreement between the parties relating to its subject matter. B. "City" shall mean the City'of Vernon, California, the entity which has executed the Agreement and, where applicable, its affiliated companies, and its officers, directors, employees, representatives and agents. C. "Contractor" shall mean Combustion Science & Engineering, Inc. and where applicable, its affiliated companies, and its officers, directors, employees, representatives and agents. D. "Contract Documents" shall include any inquiry, invitation to bid, or proposal which may have, but not necessarily, preceded execution of the Agreement, and including the General Provisions and all exhibits and schedules attached to the Agreement and all plans and specifications identified in the Contract Documents. E. "Contract Price" shall mean the compensation set forth or provided for in Section 4.01 of this Agreement. Whether it expressly provides for the reimbursement of costs incurred by Contractor or simply for the payment of a lump sum of money, it is intended to be the full and complete payment for satisfactory completion of the Work and, unless otherwise stated, to cover all costs whether for materials, equipment, tools, labor, services and taxes and all overhead, rentals and profit or fee, if any. Page 2 of 20 WHEREAS, the City desires to enter into an agreement with Contractor to perform the Services on a contractual basis as defined in the terms and conditions set forth below. NOW, THEREFORE, IT IS AGREED AS FOLLOWS: SECTION 1. TERM OF CONTRACT 1.01. This Agreement will become effective on August 1, 2007, and will continue in effect until such time as the Services are complete and the City has received all project closeout documents, or until terminated as provided in this Agreement. SECTION 2. DEFINITION OF TERMS 2.01. Whenever used in the Agreement, the following terms shall mean: A. "Agreement shall mean that formally executed Agreement or Contract which includes the Contract Documents attached. The Agreement constitutes the entire agreement between the parties relating to its subject matter. B. "City" shall mean the City of Vernon, California, the entity which has executed the Agreement and, where applicable,- its affiliated companies, and its officers, directors, employees, representatives and agents. C. "Contractor' shall mean Combustion Science & Engineering, Inc. and where applicable, its affiliated companies, and its officers, directors, employees, representatives and agents. D. "Contract Documents" shall include any inquiry, invitation to bid, or proposal which may have, but not necessarily, preceded execution of the Agreement, and including the General Provisions and all exhibits and schedules attached to the Agreement and all plans and specifications identified in the Contract Documents. E. "Contract Price" shall mean the compensation set forth or provided for in Section 4.01 of this Agreement. Whether it expressly provides for the reimbursement of costs incurred by Contractor or simply for the payment of a lump sum of money, it is intended to be the full and complete payment for satisfactory completion of the Work and, unless otherwise stated, to cover all costs whether for materials, equipment, tools, labor, services and taxes and all overhead, rentals and profit or fee, if any. Page 2 of 20 F. "General Provisions" or "General Conditions" shall mean the General Provisions as set forth in this Agreement. G. "Premises" shall mean the physical premises under City's control or ownership where Work hereunder is to be performed. H. "Proprietary Information" and "Confidential Information" shall mean all information, whether written or oral, which Contractor acquires from, through or on behalf of City, directly or indirectly, or which arises out of the Work, concerning the Work or proprietary processes involved in the Work including, without limitation, information concerning past, present or future business plans of City, information about the operations of City's Premises, and other City information or know-how obtained during the Work, except information falling into any of the following categories: 1. Information which, at the time of disclosure hereunder, is in the public domain; 2. Information which, after disclosure hereunder, enters the public domain, except where such entry is the result of Contractor's or any entity within Contractor's control breach of this Agreement; 3. Information which, prior to disclosure hereunder, was already in Contractor's possession without limitation regarding disclosure to others; or 4. Information which, subsequent to disclosure hereunder, is obtained by Contractor from a third party who is lawfully in possession of such information and not subject to a contractual or fiduciary relationship to City with respect to said information and who does not require Contractor to agree to refrain from disclosing such information to others. "Subcontractor" shall mean any first or lower -tier subcontractor and its employees, representatives, agents, subcontractors or other personnel who have been approved in the manner required by this Agreement. J. "Work" or "Services" shall mean the work performed by Contractor and required to be performed from time to time by City under this Agreement. Page 3 of 20 SECTION 3. SERVICES TO BE PERFORMED BY CONTRACTOR Specific Services 3.01. Contractor's Services shall include, but will not be limited to, conducting a study and preparing a report determining the impact of an Enhanced Turbine Output LLC Power Cool air supercharging system on Siemens SCC6-5000F Combustion Turbine pollutant emissions at baseload conditions at the proposed Vernon Power Plant Project. The Contractor's Services are more specifically detailed in the Proposal attached hereto as Exhibit "A." Change of Services 3.02. City may at any time, by written change order executed by the City, make changes only to extend the Work duration and total compensation of Contractor's Work. Only the City shall authorize changes in the scope of Work, or duties and obligations. 3.03. City may make "Changes" by increasing, reducing or deviating from the requirements of the scope of Work. A form of Change Order is set forth in Exhibit B attached hereto and incorporated by reference. Timing of Services 3.04. Contractor's Services shall commence upon the execution of this Agreement by both parties and award by the City Council and shall end at such time as the Services are completed and the City receives all project close-out documents, unless this Agreement is otherwise terminated according to Section 6 of this Agreement or extended according to the conditions and terms set forth in this Agreement. 3.05. Time is of the essence for all Work contemplated by this Agreement. Contractor shall start performing Services under this Agreement only after notification by the City. Method of Performing Services 3.06. Contractor will determine and is responsible for the method, details, and means of performing the above -described Services. Page 4 of 20 Status of Contractor 3.07. Contractor enters into this Agreement, and will remain throughout the term of this Agreement, as an independent contractor. Contractor agrees that it is not and will not become an employee, partner, agent, or principal of City while this Agreement is in effect. Contractor agrees it is not entitled to the rights or benefits afforded to City's employees, including disability or unemployment insurance, workers' compensation, medical insurance, sick leave, or any other employment benefit. Contractor is responsible for providing, at its own expense, disability, unemployment, and other insurance, worker's compensation, training, permits, and licenses for itself and for its employees and subcontractors. Contractor shall have complete and sole control over its employees, the details of the Services and methods by which the Services are accomplished, it being understood that City is interested only in the results to be obtained by Contractor. 3.08. Contractor has no authority to enter contracts or agreements on behalf of City. This Agreement does not create a partnership or joint venture between the parties. Payment of Taxes 3.09. Contractor is responsible for paying when due all income taxes, including estimated taxes, incurred as a result of the compensation paid by City to the Contractor for Services under this Agreement. Contractor agrees to indemnify City for any claims, costs, losses, fees, penalties, interest, or damages suffered by City resulting from Contractor's failure to comply with this provision. 3.10. Payroll taxes including federal, state and local taxes shall not be withheld or paid by City on behalf of Contractor or for the employees of the Contractor. Contractor shall not be treated as an employee with respect to the Services performed hereunder for federal or state tax purposes. Contractor shall be responsible to pay taxes mandated by law. 3.11. Since Contractor is not an employee of City, Contractor is not eligible for and shall not participate in any employee benefit of City, including pension, health or other fringe benefits. SECTION 4. COMPENSATION 4.01. In consideration for the Services to be performed by Contractor, described in Section 3 of this Agreement, City agrees to pay Contractor according to the Proposal set forth in Exhibit A the not to exceed amount of Fifty Thousand Dollars and No Cents ($50,000.00), on a fixed cost basis (the "Contract Price"). Page 5 of 20 Entire Compensation 4.02. The Contract Price is full and complete compensation, and constitutes the entire compensation due Contractor for the Services and any and all of Contractor's obligations hereunder. The Contract Price set forth above is not subject to escalation for any reason except as expressly set forth in this Agreement. No adjustments in compensation shall be made as a result of changes in the value of any currency. The Contract Price shall only be adjusted by formal, written Change Order or amendment to this Agreement. Payment of Compensation 4.03. For Services rendered under Section 3 of this Agreement, Contractor shall be entitled to receive monthly payments. Contractor shall submit to City a monthly invoice and statement of Services, prepared in accordance with City requirements, by the fifteenth (15t') of each month, for the prior calendar month's completed Work. City will make payments to Contractor within thirty (30) days after acceptance and approval of the invoice received from Contractor. 4.04. Contractor shall be responsible for paying any subcontractors used in the performance of this Agreement. Subcontractors shall not bill the City directly. Expenses 4.05. City shall not be liable to Contractor for any expenses paid or incurred by Contractor. Expenses may only be billed if advance written approval has been obtained from the City. Compensation for Changes 4.06. The compensation due Contractor, or the credit due City, for changes may not be established verbally, and shall be established in a written change order signed by City as described in Sections 3.02 and 3.03 of this Agreement. Compensation adjustments in each such change order shall be established by one or more of the following bases, as determined by City: (a) a lump sum price to be negotiated between the parties; or (b) Work unit rates to be negotiated between the parties. Once established, the amount of the compensation due Contractor or credit due City for a change shall not be subject to adjustment for any reason, including changes in the value of any currency. Page 6 of 20 SECTION 5. OBLIGATIONS OF THE PARTIES 5.01. Contractor is responsible for meeting all conditions of this Agreement and City Standards & Details for all Work performed. Substandard Work, as determined solely by the City, shall be redone at the expense of the Contractor. Products of Consulting 5.02. All products of consulting services including, but not limited to, manuals, documents and/or computer software, shall become the property of the City and shall be delivered to the City before the end of the performance of this Agreement. Basic notes and sketches, charts, computations and other data shall be made available to City without restriction or limitation on their use. Liability Insurance 5.03. Contractor and its subcontractor(s), if any, shall, prior to commencement of any Work and for the duration of this Agreement, obtain and maintain at its own expense, those minimum levels of insurance coverage as set forth below. Prior to commencing Work hereunder, Contractor shall provide the City with proof of insurance providing and maintaining the coverage and endorsements set forth below. Said proof of insurance shall also provide that said policy or policies shall not be canceled or materially reduced in coverage without giving at least thirty (30) days prior written notice to the City. 5.04. The insurance coverage as listed herein, shall be properly endorsed to include those contractual obligations which may be identified further within this Agreement and shall be endorsed to provide City all the rights and privileges of an additional insured. 5.05. Contractor shall cause its insurers to issue, including but not limited to, Certificates of Insurance or, upon request, certified copies of the insurance policies evidencing that the coverage and policy endorsements required under this Agreement, are maintained in force. 5.06. Contractor shall ensure its subcontractor(s), if any, maintain those insurance requirements as specified in this Agreement and are endorsed as additional insured(s) on all required Contractor insurance coverage. Contractor and its subcontractor(s), if any, shall maintain in effect the following minimum insurance coverage on an Occurrence Form Policy: 1. Workers Compensation within the statutory limits, including occupational illness or disease coverage in accordance with the laws of the nation, Page 7 of 20 state, territory, or province exercising jurisdiction over Contractor's employees. Workers Compensation and Employers Liability Insurance shall have a minimum limit of $1,000,000 per occurrence. Contractor further agrees to hold harmless and indemnify City for any and all claims arising out of an injury, disability, or death of any of Contractor's employees or agents. 2. Comprehensive General Liability Insurance, including, but not limited to, Contractual Liability, Products and Completed Operations Liability, Broad Form Property Damage and Bodily Injury Liability, and Explosion, Collapse and Underground Liability, with a minimum combined single limit of $2,000,000 per occurrence. 3. Comprehensive Automobile Insurance, including, but not limited to, all owned, non -owned or hired vehicles with a minimum combined single limit of $1,000,000 per occurrence for bodily injury and property damage. 4. Excess Liability Insurance with limits of $2,000,000. Such evidence of insurance can either be through the primary insurance coverage or through an excess policy. Such insurance shall at all times be on an occurrence form and provide policy conditions as broad as those required in the primary insurance. 5. Professional Liability Insurance with limits of $2,000,000. 5.07. Contractor agrees to provide insurance in the amounts and forms specified above. Contractor shall submit to the City documentation indicating compliance with these minimum requirements no less than one (1) day prior to the beginning of performance under this Agreement. Contractor shall not commence performance of its Work under this Agreement until the above insurance has been obtained and proof of insurance has been filed with and approved by the City. 5.08. Contractor shall not permit a subcontractor or vendor to perform work on City premises unless and until a certificate of insurance is obtained showing that such subcontractor or vendor has worker's compensation coverage. If Contractor employs subcontractors as part of the Services rendered, Contractor's protective coverage is required. Contractor may include all subcontractors as insureds under its own policy or shall furnish separate insurance for each subcontractor, meeting the requirements set forth above. Page 8 of 20 Representations 5.09. To the fullest extent permitted by law, Contractor shall defend, indemnify and hold harmless City and its elected officials, officers, agents and employees from all claims, suits, actions, demands, damages, liabilities, expenses, judgments, settlements, and penalties, losses, fines, and all costs and expenses incurred in connection therewith, including reasonable attorney's fees and all costs of defense, to the extent arising out of or attributable to the negligent or wrongful acts of Contractor or its employees or agents under this Agreement, except to the extent arising from or caused by the sole negligence or willful misconduct of the City, its officers, agents or employees. The terms of this indemnity shall survive the termination of this Agreement. The obligations in this Paragraph are in addition to Contractor's duty to provide insurance and shall not be limited by any limitation on the amount or type of insurance coverage carried by Contractor. 5.10. Contractor and City represent that each has read and understands the Agreement and Contract Documents. The Contractor represents it understands the City's regulations concerning Premises access, badges, parking, security, safety, fire, prohibited drugs and alcohol, and smoking and other rules, and that Contractor has visited Premises where the Work is to be done and is familiar with the local conditions under which it is to be done. Contractor also represents that it is experienced in performing and competent and qualified to perform the kind of tasks or assignments included in the Work and employs or has available for employment in sufficient numbers all unskilled, skilled, administrative, supervisory, professional and managerial or other personnel required to perform the Work as required by this Agreement. 5.11. Contractor represents that it has the qualifications and skills necessary to perform the Services under this Agreement in a competent, professional manner, without the advice or direction of City. This means Contractor is able to fulfill the requirements of this Agreement. Failure to perform all the Services required under this Agreement constitutes a material breach of the Agreement. Contractor has complete and sole discretion for the manner in which the Work under this Agreement will be performed. 5.12. Contractor declares and states that is has complied with and will continue to comply with all federal, state and local laws regarding business permits and licenses that may be required to carry out the Services to be performed under this Agreement. 5.13. Contractor agrees to indemnify, defend, and hold City free and harmless from all claims, demands, losses, costs, expenses, obligations, liabilities, damages, recoveries and deficiencies, including interest, penalties, attorney's fees and Page 9 of 20 costs, that City may incur as a result of a breach by Contractor of any representation or provision contained in this Agreement or any negligent or intentional acts or omissions by Contractor, it subcontractors, agents, and employees or based on any claim that any software program or other product used or furnished by Contractor in the performance of this Agreement constitutes an infringement of any United States patent or copyright. 5.14. Contractor's rights under this Agreement may not be assigned nor may its duties be delegated or subcontracted without the prior written consent of City. Any assignment or delegation or subcontract in violation of this Section shall, at City's sole discretion, be void. Consent by City shall not relieve Contractor of responsibility for performance of Contractor's obligations hereunder. City may assign all or any part of this Agreement at any time effective immediately upon written notification to Contractor. 5.15. At all times while Work is being performed on the Premises each party shall be represented thereon by a designated representative. Each party may notify the other in writing of the identity of such persons from time to time. Work Injury 5.16. The treatment and care of injuries sustained by Contractor's employees, subcontractors, representatives or other personnel shall be and remain the responsibility of Contractor. City's first aid facilities, if any, however, will be made available to Contractor's employees in emergency cases that are the direct result of accidents occurring on the Premises. City shall incur no liability for, and Contractor hereby agrees to indemnify City against, any causes of action, claim, liability or costs, including attorney's fees, arising in whole or part out of the furnishing of such first aid facilities or assistance to Contractor's employees, subcontractors, representatives or other personnel, or out of the failure to furnish such facilities or assistance. Records, Inspection and Audit 5.17. During the course of Work being performed, Contractor and any of its subcontractors, shall maintain and retain, not less than three (3) years after completion thereof, complete and accurate records of the Contractor's costs which are chargeable to the City under this Agreement. City or its designated, authorized representatives shall have the right during this three (3) year period, upon written reasonable notice, to inspect and audit those records. Such records to be maintained and retained by the Contractor shall include: (a) payroll record accounting for the total time distribution of the Contractor's employees working full or part time on the Work (to permit tracing to payroll payments in cash); (b) Page 10 of 20 invoices for purchases, receiving and issuing documents, and all the other unit - inventory records for the Contractor's stores, stock or capital items; (c) paid invoices and canceled checks for material purchased and for the subcontractor's and any other third parties' charges; and (d) any other documentation City deems necessary to support costs and charges under this Agreement. Corporate Conduct 5.18. Contractor, its employees, agents or representatives shall not offer or give to an officer, official or employee of City gifts, entertainment, payments, loans or other gratuities to influence the award of a contract or obtain favorable treatment under this Agreement or any other contract. Standard of Care 5.19. Contractor agrees that all Services provided will be conducted by the principal and competent staff members, if any, under the supervision of the principal, and that Services will be performed and rendered diligently. Contractor represents that it has, or shall secure, at its own expense, all personnel required to perform Contractor's Services under this Agreement, but at all times shall be responsible for the Services of such personnel. Contractor may not employ any subcontractor without the prior written approval of the City. Indemnity Process 5.20. The City shall notify Contractor in writing of any suits, claims or demands covered by any indemnity contained in this Agreement. Promptly after receipt of such notice, Contractor shall assume the defense of such claim with counsel reasonably satisfactory to City. If Contractor fails, within a reasonable time after receipt of such notice, to assume the defense with counsel reasonably satisfactory to City, or if, in the reasonable judgment of City, a direct or indirect conflict of interest exists between the parties with respect to the claim, or if in the sole judgment of City the assumption and conduct of the defense by Contractor would materially and adversely affect City in any manner or prejudice its ability to conduct a successful defense, then the City shall have the right to undertake the defense, compromise and settlement of such claim for the account and at the expense of Contractor. Notwithstanding the above, if the City in its sole discretion so elects, City may also participate in the defense of such actions by employing counsel at its expense, without waiving the Contractor's obligations to indemnify or defend. Contractor shall not settle or compromise any claim or consent to the entry of any judgment without the prior written consent of the City and without an unconditional release of all liability by each claimant or plaintiff to the City. Page 11 of 20 Treatment of Confidential and Proprietary Information 5.21. For ten (10) years after the effective date of this Agreement, Contractor shall refrain from using any Confidential or Proprietary Information except in connection with the Work or from disclosing it to any third party other than to employees of Contractor who require it in performance of the Work and except to such other third persons as City may authorize in writing. If disclosure to such an employee or to other third persons is so authorized, Contractor shall enter into with said party a confidentiality agreement containing provisions with respect to use and disclosure of Proprietary Information substantially the same as those contained in this Agreement. 5.22. Contractor shall take reasonable precautions to safeguard any documents containing Proprietary Information that City may supply to Contractor hereunder. Contractor may copy, in whole or part, such documents to the extent necessary for the performance of the Work, and Contractor shall return to City upon the completion of the Work or request by City all such documents and copies. 5.23. Except as expressly permitted by prior written consent of the City, Contractor and/or its subcontractors shall not disclose, permit the disclosure of, release, disseminate, or transfer, whether orally or by any other means, any part of such Confidential Information to any other person or entity. Contractor and/or its subcontractors shall return any written Confidential Information and all copies made of such items to the City upon the City's written request, but in any event not later than the date that Contractor has performed all Work to be performed pursuant to this Agreement. Contractor hereby agrees that such Confidential Information and any documents provided may be used by Contractor and/or its subcontractors only as authorized by the City. Contractor shall include a provision in its agreements with subcontractors that bind the subcontractors to this non -disclosure requirement. 5.24. All reports, plans, data, studies, maps, drawings, models, photographs, documents and other writings prepared by and for Contractor, its officers, employees, agents and subcontractors in the course of implementing this Agreement, with the exception of working notes, internal documents and Confidential Information provided by businesses located in City, shall be considered the property of City. Contractor shall deliver such documents and materials to the City as they are generated; however, Contractor may take and retain copies of said documents and materials that are not Confidential Information, as desired. 5.25. All reports, information, data and exhibits prepared or assembled by Contractor in connection with the performance of its Services pursuant to this Agreement Page 12 of 20 are confidential until released by the City to the public and Contractor agrees that such documents shall not be available to any individual or organization without the written consent of the City prior to such release. 5.26. No reports, maps, or other documents produced in whole or in part under this Agreement shall be the subject of an application for copyright by or on behalf of Contractor. Compliance with Authority 5.27. Contractor shall comply with all laws, regulations, executive orders and other applicable requirements of any governmental agencies having jurisdiction including the Fair labor Standards Act, the Occupational Safety and Health Act and all those relating in any way to employment practices and protection of the environment. Contractor shall not discriminate against any employee or any applicant for employment for reasons of race, color, creed, religion, sex, sexual preference, age or national origin. 5.28. Contractor shall make timely payment of all employment taxes and of all social security and other contributions of every kind required to be made with respect to or measured by the wages and salaries of persons employed by Contractor. 5.29. Contractor shall indemnify City against, and hold City harmless from, any liability or loss including liability or loss from fines or penalties arising out of Contractor's failure to perform the obligations imposed upon it by Sections 5.27 and 5.28 of the Agreement. Progress Reports 5.30. Contractor shall meet with City staff, upon City's request, or as needed, in order to provide reports or information concerning the Services being performed by Contractor under this Agreement. Contractor's License Classification 5.31. Contractor shall possess all appropriate licenses for the duration of this Agreement. City Provided Data and Services 5.32. The City shall furnish the Contractor available studies, reports and other data pertinent to Contractor's Services; obtain or authorize Contractor to obtain or provide additional reports and data as required; furnish to Contractor services of Page 13 of 20 others required for the performance of Contractor's Services hereunder, and Contractor shall be entitled to use and rely upon all such information and services provided by the City in performing Contractor's Services under this Agreement. 5.33. The Contractor has no control over the cost of labor, materials, equipment or services furnished by others, or over equipment vendors' or construction contractors' methods of determining prices, or other competitive bidding or market conditions, practices or bidding strategies. Cost estimates are based on the Contractor's opinion based on experience and judgment. Contractor cannot and does not guarantee that proposals, bids or actual Project construction costs will not vary from cost estimates prepared by Contractor. SECTION 6. TERMINATION OF AGREEMENT 6.01. Unless otherwise terminated as provided in this Section, this Agreement will continue in effect until such time as report is complete and the City receives all project close-out documents, unless otherwise extended according to the terms and conditions set forth in this Agreement. Non -Default Termination 6.02. City, at its sole discretion, may terminate this Agreement upon thirty (30) days written notice to Contractor and such termination shall be effective in the manner specified in such notice and shall be without prejudice to any claim that either party may have against the other. During the thirty (30) day period after such notice is sent, the parties shall continue to act toward each other in good faith. 6.03. In the event of any such termination, in full and complete settlement for the termination of the Work, City shall pay Contractor for those Services performed prior to the date of delivery of the termination notice, plus compensation for (i) necessary Work performed during the notice period and authorized in the termination notice, and (ii) all costs reasonably and necessarily incurred by Contractor directly attributable to termination which could not reasonably have been avoided and for which Contractor is not otherwise compensated that are incurred through the date of termination and effectuating the termination ("Termination Expenses"). Termination Expenses shall not include lost profits, lost opportunities, consequential damages, or the like. In no event shall total payment exceed the Contract Price. Termination on Occurrence of Stated Events 6.04. This Agreement will terminate automatically on the occurrence of any of the Page 14 of 20 following events: A. Bankruptcy or insolvency of either party; or B. Sale of the Contractor; or C. Assignment of this Agreement by Contractor without City's written consent. Termination for Default 6.05. If Contractor defaults in the performance of this Agreement or materially breaches any of its provisions, City may immediately terminate this Agreement by giving written notification to Contractor indicating the effective date of such termination. Termination will take effect immediately upon the date specified in the notification. For the purposes of this paragraph, material breach of this Agreement includes, but is not limited to, the following: A. Contractor's failure to perform, in a manner satisfactory to the City in its sole discretion, the Services specified in Section 3 of this Agreement; or B. Contractor's material breach of any obligation or provision contained in Section 5 of this Agreement. 6.06. The waiver by either party of a breach or default by the other party shall not be deemed a waiver of any different or later breach; nor shall any delay or omission by either party to exercise any right it may have hereunder operate as a waiver of any breach or default of such a right. The failure of either party to this Agreement to exercise any of its rights under this Agreement does not constitute a breach thereof and shall not be deemed to be a waiver of such rights or a waiver of any subsequent breach. 6.07. In the event of any termination of this Agreement or reduction in the scope of the Work, Contractor shall not be entitled to damages for loss of profits for the unexecuted portion of the Work or any other damages because of such termination or reduction. Page 15 of 20 SECTION 7. GENERAL PROVISIONS Notices 7.01. All notices, approvals, consents and other communications between the parties shall be in writing, and shall be sent by fax or by certified mail (return receipt requested) to the respective addresses set forth below, or at such other address as may be furnished by either party to the other in writing. Faxed notices, confirmed by copy thereof, shall be deemed communicated as of the day the facsimile was sent. Mailed notices will be deemed communicated as of the day of receipt or the third (3`d) day after mailing, whichever occurs first. Contractor — City - City of Vernon Combustion Science & Attn: City Administrator Engineering, Inc. 4305 Santa Fe Avenue Attn: Michael S. Klassen Vernon, CA 90058 8940 Old Annapolis Road, Suite L Columbia, MD 21045-2129 Fax: 410-884-3267 Fax: 323-826-1438 Telephone: 410-884-3266 Telephone: 323-583-8811 Copy to: Vernon City Hall Attn: Director of Light & Power 4305 Santa Fe Avenue Vernon, CA 90058 All invoices shall be mailed via U.S. Postal Service to the following address: Vernon City Hall Attn: Office of the Treasurer/Light & Power 4305� Santa Fe Avenue Vernon, CA 90058 Entire Agreement of the Parties 7.02. This Agreement supersedes any and all agreements, either oral or written, between the parties with respect to the rendering of Services by Contractor for City and contains all of the representations, covenants, and agreements between Page 16 of 20 the parties with respect to the subject matter of this Agreement and the rendering of those Services. Each party to this Agreement acknowledges that no representations, inducements, promises, or agreements, orally or otherwise, have been made by any party, or anyone acting on behalf of any party, which are not contained in this Agreement, and that no other agreement, statement, or promise not contained in this Agreement or a subsequent amendment or change order shall be valid or binding. No amendment or change in the provisions of this Agreement shall be made, except in a formal written amendment signed by Contractor and an authorized representative of the City, or in a written change order. Contractor expressly waives all claims for compensation based upon quantum meruit, implied contract or oral contract. Each party represents and warrants that it has read and fully familiarized itself with this Agreement, and that such party has been fully authorized to sign this Agreement. 7.03. This Agreement shall be comprised of these included provisions, together with Exhibits A and B, which are all attached. In the event of conflict between this Agreement and any of the exhibits, including the Proposal, this Agreement shall prevail. Partial Invalidity 7.04. If any provision of this Agreement is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remaining provisions will continue in full force and effect without being impaired or invalidated in any way. Law and Arbitration 7.05. All disputes arising out of or related to this Agreement, the conduct of either party in connection with this Agreement, and the relationship and rights of the parties in connection with this Agreement, whether characterized as breach of contract, tort, or otherwise (except for those requesting injunctive relief) shall be determined by binding arbitration in accordance with the terms of this Section. The submittal of all matters to arbitration in accordance with the terms of this Section is the sole and exclusive method, means and procedure to resolve any and all claims, disputes or disagreements arising under this Agreement, except for claims by either party which seek injunctive relief, which claims shall be resolved by suit filed in the Superior Court of Los Angeles County, California, the decision of which court shall be subject to appeal pursuant to applicable law. The parties hereby irrevocably waive any and all rights to the contrary and shall at all times conduct themselves in accordance with the terms of this Section, relying on arbitration as the sole means of resolution of disputes. Arbitration of all matters required to be arbitrated hereunder shall take place before a panel of three retired judges of the Superior Court of the State of California (the Page 17 of 20 "Arbitrators") under the auspices of Judicial Arbitration & Mediation Services, Inc. ("JAMS"). Such arbitration shall be initiated by the parties, or either of them, within ten (10) calendar days after either party sends notice of a demand to arbitrate (the "Arbitration Notice") to the other party and to JAMS. The Arbitration Notice shall contain a description of the subject matter of the arbitration, the dispute with respect thereto, the amount involved, if any, and the remedy or determination sought. Each party shall select a retired judge from the JAMS panel, and the two selected judges shall mutually agree on the third retired judge from the JAMS panel. If one of the parties does not select a retired judge from the JAMS panel within fourteen (14) calendar days after receipt of the Arbitration Notice, JAMS will select the second judge, and the judge selected by JAMS and the judge selected by the other party will select the third judge for the panel. The third judge is to be selected within ten (10) calendar days following the selection of the first two judges. The three judges will together serve as the Arbitrators. The arbitration shall be conducted in Los Angeles, California. Any party may be represented by counsel and/or other authorized representative. In rendering a decision(s), the Arbitrators shall determine the rights and obligations of the parties according to the substantive and procedural laws of the State of California and the terms of this Agreement. The decision of the Arbitrators shall be based on the evidence introduced at the hearing and accompanied by a written statement of decision as to each of the principal controverted issues. The agreement of two of the three Arbitrators as to the resolution of the dispute shall be a conclusive resolution. The Arbitrators shall deliver the written decision to the parties within thirty (30) calendar days following the date of the selection of the last of the Arbitrators. The decision shall be conclusive and binding, and it may thereafter be confirmed as a judgment by the Superior Court of the State of California, subject only to challenge on the grounds set forth in the California Code of Civil Procedure Section 1286.2. The validity and enforceability of the decision of the Arbitrators is to be determined exclusively by the California courts. Attorney's Fees 7.06. In the event a dispute, claim or Litigation arises regarding this Agreement, the prevailing party shall be entitled to reimbursement for reasonable attorneys' fees and actual costs, which may be set by the arbitrators or the court in the same action or in a separate action brought for that purpose, in addition to any other relief which is obtained. 7.07. Neither party shall be considered in default in any of its obligations under this Agreement when a failure of performance shall be due to an uncontrollable force. The term "uncontrollable force" shall mean any cause beyond the control of the party affected, including, but not restricted to, flood, earthquake, storm, fire, Page 18 of 20 lightning, epidemic, war, riot, civil disturbance or disobedience, federal, state, or municipal action, statute, ordinance, or regulation, embargoes of the United States Government or any other government, which by exercise of due diligence such party could not reasonably have been expected to avoid and by exercise of due diligence has been unable to overcome. Either party rendered unable to fulfill any of its obligations under this Agreement by reason of an uncontrollable force shall give written notice within five (5) business days of such fact to the other party and shall exercise due diligence to remove such inability with all reasonable dispatch. 7.08. Except as may otherwise be specifically provided herein, this Agreement may be modified or amended only by a written document executed by both Contractor and the City and approved as to form by the City Attorney. 7.09. The captions used in this Agreement are for convenience only and shall in no way define, limit or describe the scope or intent of the Agreement or any part thereof. Page 19 of 20 7.10. City reserves the right to award similar contracts to multiple contractors to ensure the City has adequate services. IN WITNESS WHEREOF, the parties have executed the Agreement on the dates shown below. City: Contractor: City of Vernon Name: Leonis C. Malburg Title: Date: R122%7 TTEST: AP ROV AS TO FORM: anuela Giron rison City Clerk fZttley Combustion Science & Engineering, Inc. Name: Title: ice - Date: AU + 2 ZD Name: Title: Date: Page 20 of 20 EXHIBIT A 1 Combustion Science & Engineering, Inc. 8940 Old Annapolis Road • Suite L • Columbia • MD • 21045 -2129 • Tel: 410 / 884-3266 • Fax: 410 / 884-3267 Proposal to Characterize the Effect of ETO's PowerCoolrm System on Turbine Emissions Combustion Science & Engineering, Inc. (CSE) proposes to conduct a study to determine the impact of ETD's PowerCoolTM air supercharging system on gas turbine pollutant emissions at baseload conditions. The premise of the PowerCoolTM system is to maximize the mass flow rate through the turbine at all atmospheric conditions (Temperature and Pressure). The PowerCoolTM system offsets the compressive heating of the air through water injection and droplet evaporation. This study will highlight the effects on combustor performance when maintaining total power from the turbine by reducing combustor heat release but increasing the mass flow rate of air through the turbine. This study will utilize combustor inlet conditions similar to that of a non -piloted, large frame turbine such as the Siemens SGTG-5000 (W501F). A general methodology will be developed that can be used to analyze other combustion systems as well. A detailed kinetic analysis will be performed using a full chemical kinetic mechanism and a one-dimensional computer code. The use of a simplified flow model is necessary in order to incorporate the more complete reaction mechanisms needed to accurately study pollutant emissions in the combustor. The combustor will be simulated through the use of chemical reactor modeling (CRM). The CRM approach has also been used effectively by various authors [1, 2, 3] to model the combustion zone of a gas turbine engine (GTE). This approach generally assumes that the primary zone of a gas turbine combustor can be modeled as a PSR, and the dilution zone can be modeled as a PFR. These simplified fluid mechanic constructs allow for accurate solution of detailed kinetics mechanisms that typically include tens of species and hundreds of reactions. By passing the output from one reactor to the input of another reactor, the movement of the reacting flow through the combustor can be simulated while maintaining the ability to solve for detailed time -concentration histories of a large number of major and minor species including CO, NOx, and UHCs. These detailed mechanisms provide accurate species concentration predictions over a wide range of fuel -air equivalence ratios. The June 22, 2007 Confidential and Proprietary Combustion Science & Engineering, Inc. major drawback of this approach is that it simplifies the fluid mechanics of the combustor. This analysis will utilize several programs developed by Sandia National Laboratory: Perfectly Stirred Reactor (PSR) , SENKINS and CHEMKIW. The well - validated GRI reaction mechanism' (GRI 3.0) for natural gas (which incorporates over 200 reactions and over 50 species) will be used in this analysis. The CRM model will be used to obtain baseline (i.e. without ,the PowerCoolTM system) pollutant emissions from the simulated gas turbine combustor. Combustor performance will then be assessed with the addition of the PowerCoolTM system. The ability of the mass flow augmentation system to reduce pollutant emissions while maintaining `baseline' power output will also be assessed. CSE will also investigate a range of water loadings within the additional airflow from the PowerCoolTM system. The study will be conducted in two parts. The initial portion (Part n will focus on assessing the impact of the PowerCoolTM system on gas turbine performance. The scope of the initial portion of the study will include: • Baseline combustor performance. A CRM network will be developed that effectively models the performance of a large frame gas turbine combustor. Pollutant emissions of the CRM model will be assessed for base load conditions. This data will provide the baseline performance to which the model with the mass flow rate augmentation can be compared. • Combustor performance with the PowerCoolTM system at conditions for maximum power output. The input parameters for the CRM network will be modified to include the mass flow rate augmentation from the PowerCoolTM system at conditions designed to maximize power output. Pollutant emissions of the CRM model will be assessed for these conditions and compared to the baseline combustor performance. • Combustor performance with the PowerCoolTM system at conditions when baseline combustor power maintained. The input parameters for the CRM network will be modified to include the mass flow rate augmentation from the PowerCoolTM system at conditions designed to maintain the combustor output at baseline levels. This study will investigate the possibility of lowering combustor firing temperature by June 22, 2007 Confidential and Proprietary Combustion Science & Engineering, Inc. using mass flow rate augmentation to maintain combustor power output. Pollutant emissions of the CRM model will be assessed for these conditions and compared to the baseline combustor performance. • Combustor performance with the PowerCoolTM system with a range of water loadings in augmentation airflow. Water loadings of 25%, 50%, and 75% of that designed for maximum power output in the augmentation airflow will be assessed as to their impact on combustor. performance (pollutant emissions). These results will be compared to baseline combustor performance as well as combustor performance with the PowerCoolTM system parameters designed for maximum power output. • The GateCycle software program will be used to model a Siemens SGT6-5000F (formerly Siemens Westinghouse 501F) gas turbine in simple cycle operation to predict the performance enhancement provided when using the PowerCoolTM system. Initially, three ambient temperature conditions will be considered. For each ambient temperature, calculations will be made for inlet fogging to reduce the gas turbine inlet temperature to within 2 F of the wet bulb temperature and for inlet fogging to reduce the temperature to within 5 F of the wet bulb temperature. Additional conditions (up to 6 cases) will be also be run, using the same gas turbine model but at different ambient conditions and inlet fogging levels. The second portion of the analysis will serve to conduct more detailed analysis of the impact of the PowerCoolTM system. The scope of this work will be determined after the initial results are presented to the client and will be guided by client needs and questions. It is anticipated that a compressor expert will be used in the later analysis to determine the impact of the PowerCoolTM system on compressor performance. ETO Supplied Information ETO will be required to provide inlet conditions for combustion system. This will include pressure, temperature, mass flow rates and concentration of water in the augmentation flow. Furthermore, ETO will provide the input conditions to conduct the GateCycle analysis (environmental conditions, gas turbine model, compressor shaft limits June 22, 2007 Confidential and Proprietary Combustion Science & Engineering, Inc. etc). CSE will provide a detailed list of the necessary inputs. If ETO can not provide all the inputs, literature values and/or engineering estimates will be utilized. Corporate Capabilities and Key Personnel CSE's team includes degrees in Chemistry, and Chemical, Mechanical, and Fire Protection Engineering, offering its clients more than one hundred years of combined experience in research, development, design, and analysis of a wide array of problems in combustion science. Dr. Michael Klassen will be the lead engineer on this proposed project. Dr. Ponnuthurai Gokulakrishnan and Mr. Diwakar Vashishat will be the other engineers as required. Dr. Leo Eskin will lead the effort to model the overall cycle using GateCycle. A brief description of the key personnel is given below. Resumes are provided at the end of this proposal. Michael S. Klassen, Ph.D., P.E., (Mechanical Engineering) has worked at CSE since the inception of the company serving as a Principal Research Engineer. Dr. Klassen has over fifteen years of experimental fire and combustion research experience. During his tenure at CSE, Dr. Klassen has heavily involved in development of reduced mechanisms and application of chemical kinetic studies to gas turbine related problems. Dr. Klassen has spent much of his career conducting research at the University of Maryland and Purdue University where his projects included the development of laser and optical diagnostic techniques, the investigation of the effects of high pressure on NO formation in flames, and the study of radiation properties and flame structure of liquid fuel pool flames. He also served as Guest Researcher for the National Institute of Standards and Technology —Center for Building and Fire Research, and the Fire Research Institute — Department of Home Ministry in Tokyo, Japan. Prior to forming CSE, Dr. Klassen worked for Hughes Associates, Inc. where he was responsible for conducting large-scale fire tests, fire modeling, characterizing fire suppression systems involving flashing liquids (i.e. two-phase flow), and supporting fire litigation. Ponnuthurai (Gokul) Gokulakrishnan, Ph.D. (Chemical Engineering) has extensive experience in applied combustion chemistry related to practical combustion systems such as Low-NOx burners and internal combustion engines. Before joining CSE, Inc. as a June 22, 2007 Confidential and Proprietary Combustion Science & Engineering, Inc. Senior Engineer, Dr. Gokulakrishnan was an NSERC Post -doctoral Fellow at Princeton University engaged in experimental and computational study of developing reduced kinetic mechanism for gasoline oxidation pertaining to internal combustion engines. He also studied the effect of product gas entrainment on NOx formation in Low-NOx burners employed in natural -gas -fired industrial gas furnaces for his doctorate thesis. His Master's thesis project was on the effect of chlorine on NOx formation in fluidized bed combustors related to coal combustion. Leo D. Eskin, Ph.D., (Mechanical Engineering) has over twenty years of experience modeling gas turbine systems, combined cycle power plants, and integrated gasification combined cycle (IGCC) power plants. Before joining CSE, Inc., Dr. Eskin was one of the original owners of Enter Software, Inc, where he was a key developer of the GateCycle power plant modeling software, and the EfficiencyMap gas turbine performance modeling and data acquisition software. Dr. Eskin also has a broad background in the field of nuclear power, and was responsible for providing the nuclear enhancements to GateCycle to model the nuclear steam supply system (NSSS) and high moisture nuclear steam turbines. Dr. Eskin also once held a Senior Reactor Operator's License. Cost The total budget for the proposed study is $50,000 on a fixed cost basis. Part I of the study will cost $25,000. Part II includes $10,000 for work of the compressor expert, with the remaining funds used to answer specific questions raised after Part 1. The results of the Part I of the study will be delivered in a final report no later than two months after final acceptance of the proposal. The delivery date of Part II of the analysis will be determined after the scope of that work is established. The following billing rates are used in this work: Principal Engineer: $140/hr Senior Engineer: $125/hr June 22, 2007 Confidential and Proprietary Combustion Science & Engineering, Inc. Project Engineer: $110/hr Staff Engineer: $95/hr The costs detailed in this proposal will be valid for one month. The contracted services may be canceled or terminated at any time by either ETO or CSE by the giving of seven days prior written notice. CSE reserves the right to assign personnel on an "as available" basis. This work will be billed on a monthly basis. CSE invoices are due upon receipt. Accounts unpaid for 30 days from the date of invoice are subject to a 1.5 percent per month service charge. Accounts unpaid for 60 days from the date of invoice will be a cause for CSE to suspend all performance under this Agreement upon a 14 day written notice unless payment in full is received within 14 days from the date of the written notice. In the event of a suspension of services, CSE shall have no liability for any delay or other damage, contractual or otherwise, caused by or arising out of the suspension of services of nonpayment. Acceptance by CSE of any payment more than 120 days old shall not serve as a waiver of LSE's contractual right to suspend service for nonpayment. REFERENCES 1. Rizk, N. K. and Mongia, H. C. "A Semi -Analytical Emission Model for Diffusion Flame, Rich/Lean, And Premixed Lean Combustors." Paper No. 93-GT-128, ASME/IGTI Turbo Expo, Cincinnati, Ohio, 1993. 2. Rizk, N. K. and Mongia, H. C. "Evaluation of Emission Model for Diffusion Flame, Rich/Lean, and Premixed Lean Combustors." Paper No. 93-GT-165, ASME/IGTI Turbo Expo, Cincinnati, Ohio, 1993. 3. Tonouchi, J. H., Held, T. J. and Mongia, H.C. "A Semi -Analytical Finite Rate Two - Reactor Model for Gas Turbine Combustors." Paper No. 97-GT-126, ASME/1GTI Turbo Expo, Orlando, Florida, 1997. 4. Glarborg, P., Kee, R. J., Grcar, J. F., and Miller, J.A., PSR: A FORTRAN Program for Modeling Well -Stirred Reactors, Sandia National Laboratories, SAND86-8209, 1986. June 22, 2007 Confidential and Proprietary Combustion Science & Engineering, Inc. 5. Lutz, A. E., Kee, R. J., and Miller, J. A., SENKIN: A FORTRAN Program for Predicting Homogeneous Gas Phase Chemical Kinetics with Sensitivity Analysis, Sandia National Laboratories, SAND87-8248, 1987. 6. Kee, R. J., Miller, J. A., and Jefferson, T. H., CHEMKIN: A General -Purpose Problem -Independent, Transportable, Fortran Chemical Kinetics Code Package, Sandia National Laboratories, SAND80-8003, 1980. 7. GRI Mechanism 3.0, WWW site: http://www.gri.com/, 1995. June 22, 2007 Confidential and Proprietary Combustion Science & Engineering, Inc. EXHIBIT B EXHIBIT B Form Change Order CHANGE Contract Number: Change Number: The requirements of the above designated Agreement are changed as follows: City and Combustion Science agree that Combustion Science's compensation shall be adjusted as follows: City and Combustion Science agree that Combustion Science's schedule shall be adjusted as follows: This adjustment covers the entire compensation for the Change set forth above and includes, but is not limited to compensation for all engineering, material, equipment, subcontracts, labor, overhead, profit, changes in scheduling and delays resulting, directly or indirectly, from the Change, as further detailed in the Agreement. Combustion Science & Engineering, Inc. City of Vernon :A Date RIM LM Date 4- INSTRUCTIONS TO COMBUSTION SCIENCE & ENGINEERING, INC. Contract Number: Instruction to Combustion Science Number: Date: Specific Instructions to Combustion Science: In accordance with the Terms and Conditions of the Agreement, the City classifies these instructions as: Supplementary instructions, not involving a Change (Should these instructions be, in the opinion of Combustion Science, a "Change", written notice thereof must be given to City within 10 days of the receipt of these instructions. If such written notice is given, Combustion Science shall not commence with the work so ordered until written agreement is reached on the classification of these instructions and on the resulting adjustment in contract compensation, if any.) In the event that City and Combustion Science fail to agree on the classification of these instructions or resulting adjustment in contract compensation, if any, refer to the Changes Section of the Agreement. A Change (Combustion Science shall, within 10 days of the receipt of these instructions, furnish City a statement of its proposal for adjustment in contract compensation occasioned hereby. Combustion Science shall not commence with the work so ordered until written agreement is reached on the resulting adjustment in contract compensation, if any.) In the event that City and Combustion Science fail to agree on the classification of these instructions or resulting adjustments in contract compensation, if any, refer to the Changes Sections of the Agreement. City Representative Date Please acknowledge receipt of this instruction by returning one copy signed in the space provided below. Combustion Science's signature hereon does not indicate his acceptance of the classification assigned hereto by City. Combustion Science's Representative MIM Date � � M RISK MANAGEMENT OFFICE INTER -DEPARTMENT MEMORANDUM DATE: September 5, 2007 TO: Nelly Giron City Clerk FROM: Willard G. Yamaguchi Chief Deputy City Attorney/Risk ManagerVt V, RE: Combustion Science & Engineering, Inc. p , Please be advised that the above referenced has provided acceptable insurance coverage. Attached for your retention are original insurance certificates and related policies, declarations and/or endorsements for the above -referenced insured that were issued by: • The Hartford (General Liability, Automobile Liability, Excess/Umbrella Liability, and Workers Compensation) • CNA (Professional Liability) This concerns Resolution No. 9371, Agreement File No. 07-076. TRY/kr cc: Donal O'Callaghan ACORD.; CERTIFICATE OF LIABILITY INSURANCE 7 DATE(MM/DD/YYYY) s 21/2007 PRODUCER The Hoffberger Insurance Group 5700 Smith Avenue Baltimore, MD 21209 410-542-3300 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. INSURERS AFFORDING COVERAGE NAIC# INSURED Combustion Science & Engineering, Inc 8940 State Route 108, Suite L Columbia, MD 21045-2129 INSURER A: The Hartford INSURER B: CNA INSURER C: INSURER D: INSURER E: COVERAGES THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. AGGREGATE LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. 1NSR LTR AWL NSRD TYPEF INSURANCE POLICY NUMBER POLICY EFFECTIVE DATE MM/DD POLICY EXPIRATION DATE MM/DD LIMITS GENERAL LIABILITY EACH OCCURRENCE $ 2, 00,000 X1 COMMERCIAL GENERAL LIABILITY CLAIMSMADE 7 OCCUR PREMISES Ea oocurenoe $ 300,000 MED EXP (Any one person) $ 10,000 PERSONAL & ADV INJURY $ 2,000,000 A PROFESSIONAL 30 SBA BI0386 02/01/07 02/01/08 LIAB EXCLUDED GENERAL AGGREGATE $ 4,000,000 GENT AGGREGATE LIMIT APPLIES PER: PRODUCTS - COMP/OP AGG $ 4,000,000 X POLICY PRO- JECT LOC AUTOMOBILE LIABILITY X ANYAUTO COMBINEDSINGLE LIMIT (Eaacciderd)ideM) $ 1,000,000 BODILY INJURY (Per Person) $ ALLOWNEDAUTOS SCHEDULED AUTOS A X HIRED AUTOS X NON-OWNEDAUTOS 30 UEC IZ4610 02/01/07 02/01/08 BODILY INJURY (Peraccident) $ PROPERTY DAMAGE (Peraccident) $ GARAGE LIABILITY AUTOONLY-EA ACCIDENT $ OTHERTHAN EAACC AUTOONLY: AGG $ ANYAUTO $ EXCESSIUMBRELLA LIABILITY X OCCUR CLAIMSMADE EACH OCCURRENCE $ 3,000,000 AGGREGATE $ 3,000,000 30 SBA BI0386 02/01/07 02/01/08 $ A DEDUCTIBLE $ X RETENTION $ 10,000 $ A WORKERSCOMPENSATIONAND EMPLOYERS' LIABILITY ANY PROPRIETOR/PARTNERIEXECUTIVE OFFICERIMEMBER EXCLUDED? SPECdescribeunder IALPROVISIONS below 30 WEC IB7616 02/01/07 02/01/08 X I TNRYLIMITS ER E.L. EACH ACCIDENT $ 1,000,000 E.L. DISEASE - EAEMPLOYEE $ 1 000,000 E.L. DISEASE - POLICY LIMIT $ 1 000,000 OTHER B Professional 25-401-63-47 03/24/07 03/24/08 $2,000,000 Per Claim ILiability $2,000,000 Aggregate DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES / EXCLUSIONS ADDED BY ENDORSEMENT / SPECIAL PROVISIONS Certiifcate Holder is Named as additional insured as regards the General Liability as their interest may appear. City of Vernon Attn: Risk Management 4305 Sante Fe Ave Vernon, CA 90058 SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATIOI DATE THEREOF, THE IP61NG INSURER WILL ENDEAVOR TO MAILS DAYS WRITTEN NOTICE TO THE CE IFICATE HOLDER NAMED TO THE LEFT, BUT FAILURE TO DO SO SHALL IMPOSE 06 0*46AT10N OR LIABILITYQf ANY 6IND WON THE INSURER, ITS AGENTS OR ACORD25(2001108) IV 1 ©ACORDAORPORATION 1988 Sea. 5. 2007 12:23PM HOFFBERGER INSURANCE GROUP No. 1301 P. 2 BUSINESS UABIUTy COVERAGE FORM (b) Rented to, in the care, custody or control of, or over which physical control is being exercised for any purpose by you, any of your "employees", "Volunteer workers", any partner or member (if you are a partnership or joint venture), or any member (if you are a limited liability company). b. Real Estate Manager Any person (other than your "employee" or r "volunteer worker"), or any organization while acting as your real estate manager. c. Temporary Custodians Of Your Property, o Any person or organization having proper temporary custody of your property if you m die, but only, (1) Wth respect to liability arising out of the Mairdenance or use of that property; and (2) Until your legal representative has o been appointed. N d. Legal Representative If You Die # Your legal representative if you die, but i� only with respect to duties as such. That now representative will have all your rights and duties under this insurance. @. Unnamed Subsidiary Any subsidiary and subsidiary thereof, of yours which is a legally incorporated entity of which yoU own a financial interest of more than 50% of the voting stock on the effective date of this Coverage Part. rl The insurance afforded herein for any subsidiary not shown in the Declarations as a named insured does not apply to injury or damage with respect to which an insured under this insurance is also an Insured under another policy or would be an insured under such policy but for its termination or upon the exhaustion of its firm of insurance_ 3. Newly Acquired Or Formed Organization Any organization you newly acquire or form, other than a partnership, joint venture or limited Itabtiay company, and over which you maintain financial interest of more than 50% of mom the voting stock, will qualify as a Named Insured it"them is no other similar insurance available to that organization.. However: a. Coverage under this provision is afforded only until the 1 With day after you acquire of fort the organization or the end of the polity period, whichever is earlier; and b. Coverage under this provision does not apply to: (1) "Boday injury' or "property damage!' that occurred; or (2) "Personal and advertising injury" arising out of an offense committed before you acquired or formed the organization. 4. Operator Of Mobile Equipment Vft respect to "mobile equipment" registered in your name under any motor vehicle registl'atian law, any person is an insured while driving such equipment along a public highway wlm your permission. Any other person or organization responsible for the conduct of such person Is also an Insured, but only with respect to Inability arising out of the operation of ftre equipment, and only if no other insurance of any kind is available to that person or organization for this liability. However, no person or organization is an insured with respectto: a. "godly injury" to a oo-"employee" of the person driving the equipment; or b. "property damage" to property owned by, rented to, in the charge of or ocarplod by you or the employer of any person who is an insured under this provision. S. operator of Nonowned Watercraft Nth respect to watercraft you do not own that is less than 51 feet long and is not being used to carry persons for a charge, any person is an insured while operating such watercraft with your permission. Any other person or organization responsible for the conduct of such person is also an insured, but only with respect to. liability arising out of the operation of the watercraft, and only if no other insurance of any kind Is available to that person or organization for this liability_ However, no person or organization is an insured with respect to: a.- 'Bodily injury" to a Co -"employee" of the person operating the watercraft; or b. 'Property damage" to property owned by, rented to, in the charge of or occupied by you or the employer of any person who is an insured under #his provision. aK S. Additional Insureds When Required BY Written Contract, Written Agreement Or permilt The person(s) or organization(s) Identified in Paragraphs a. through C Mow are additional insureds when you have agreed, In a written Form SS 00 08 04 06 . Page 11 of 24 Sep. 5. 2007 12:24PM HOFFBERGER INSURANCE GROUP BUSINESS UABIUTY COVERAGE FORM No. 1301 P. 3 contract, written agreement or because of a (a) Any failure to make such inspections, adjustments, tests or permit issued by a state or political subdivision, that such person or organization servicing as the vendor has norrfWIV be added as an additional insured on your agreed to make or undertakes to make in the usual policy, provided the injury or damage occurs course of business, in connection subsequent to the execution of the contract or with the distribution or sale of the. agreement, or the issuance of the permit. A ion or organization is an additional products' (f) Demonstration, installation, insured under this provision only for that Servicing or repair operations, period of time required by the contract, apt such operations performed agreement or permit. at the vendor's premises in However, no such person or organization is an connection with the sale of the additional insured under this provision if such product person or organization is included as an (g) Products which, after distribution additional insured by an endorsement issued or sale by you, have been labeled by us and made a part of this Coverage Part, or relabeled or used as a including all persons or organizations added container, part or ingredient of any as additional insureds under the specific other thing or substance by or for, additional insured coverage grants in Section the vendor; or F. —Optional Additional Insured Coverages. If+l Bodily -injury " or „prop a. Vendors damage" arising out of the sole Any parson(s) or organization(s) (referred to negligence of the vendor for its below as vendor), but only with respect to own acts or omissions or those of "bodily injury" or "property damage" arising its 'employees or anyone else out of 'your products" vvhich are distributed acting on its behalf. However, this or solo in the regular course of the vendor's exclusion does not apply to: business and only if this Coverage Part (i) The exceptions contained in provides coverage for "bodily injury" or Subparagraphs (d) or (f); or "property damage" included within the "products -completed operations hazard". i Such inspections, adjustments, . !I') tests or semdng as the vendor (1) The insurance afforded to the vendor has agreed to make or normally is subject to the following additional undertakes to make in the usual exclusions: course of business, In This insurance does not apply to: connection wfiim the distribution (a) "Bodily injury" or "property or sale of the products. damage" for which the vendor is (2) This insurance does not apply to any obligated to pay damages by insured person or organization from reason of the assumption of whom you have acquired such products, liability in a contract or agreement. or any ingredient, part or container. This exclusion does not apply to entering into, accompanying a' liability for damages that the containing such products. vendor would have in the absence b, Lessors Of Equipment of the contract or agreement; (1) Any person or organization from (b) Any express warranty whom you lease equipment; but only unauthorized by you; wfth respect to their liability for "bochly (c) Any physical or chendcal change injury", "property damage" or In the product made intentionally "personal and advertising injury" by the vendor, caused, in whole or in part, by your (d) Repackaging, excapt when maintenance. operation or use of unpacked solely for the purpose of equipment leased to you by such inspection, demonstration, testing, person or organization. or the substitution of parts under Instructions from the manufacturer, and then repackaged in the original container, Page 12 of 24 Form SS 00 08 04 05 Sep. 5. 2007 12:24PM HOF-BERGER INSURANCE GROUP No.1301 P. 4 BUSINESS LIABILITY cOVERAQE FORM (2) With respect to the insurance afforded a. permits Issued By State Or Political to these additional insureds, this Subdivisions _ insurance does not apply to any (1) Any state or political Subdivision but "occurrence" which takes place after only with • respect to operations you cease to lease that equipment. pertrmd by you or on your behalf for c. Lessors Of Land Or prernises which the state or poiit w subdivision (1) Any person or organization from has issued a pemtit whom you lease land or premises, but (2) With respect to the insurance afforded only with respect to liability arising out to these additional insureds, this of the ownership, maintenance or use insurance does not apply to: of that part of the land or premises (a) "Bodly injury", "property damage" N leased to you. or "personal and advertising N `v (2) Withrespedio the insurance afforded Injury" arising out of operations to these additional insureds, this performed for the stale or insurance does not apply to: municipality; or o (a) Any "occurrence" which takes (b) "Roddy injury" or "property damage" ri place after you cease to lease that withiA the " " o land or be a tenant in that quieted operations hazard". premises; or f. Any Other Party (b) structural alterations, new (1) Any other person or organization who construction or demolition is not an insured under Paragraphs a. a operations performed by or on through s. above, but only with behalf of such person or reaped to liability for "bodily injury", organization. "property damage" or "personal and d. Architects, Engineers Or Surveyors advertising Injury" caused, in whole or old (1) Any archdecx, engineer, or surveyor, but in part, by your acts or omissions or the ads or omissions of those acting only with respect to liability for "bodily on your f�half. ' „ „ jury", property damage or personal and advertising injury" caused, In whole (a) in the perbmrance of your or in part, by your acts or omissions or ongoing operations; the ads or omissions of those acting on (b) In connection with your premises :sue your behalf: owned by or rented to you: or (a) In connection with your premises; (c) in connection with "your work" and m or included within the "products - OEM (b) In the performance of your completed operations hazard", but �mr ongoing operations performed by only if you or on your behalf. (i) The written contract or written (2) With rasped to the insurance afforded agreement requires you to to these additional insureds, the provide such coverage to following additional exclusion applies: such additional insured; and This insurance does not apply to (ii) This Coverage Part provides "bodily injury", 'property damage" or coverage for "bodily injury" or "personal and advertising injury" "property dame" included arising out of the rendering of or the within the "products - failure to render any professional co mpleted operations hazard". services, by or for you, including: (2) Write respect to the insurance afbrded now (a) the preparing, approving, or to these additional insureds, this failure to prepare or approve, insurance does not apply to- ME" maps, shop drawngs, opinions, "aodily injury", "property damage" or reports, surveys, field orders, "personal and advertising injury" change orders, designs or arising out of the rendering of. or the drawings and specifications; or Murs to render, any professional (b) Supervisory, inspection, architectural, engineering or surveying architectural or engineering services. Including: activities - Form 88 00 08 04 05 Page 13 of 14 Sep. 5. 2007 12:24PM HOFFBERG£R INSURANCE GROUP BUSINESS UABtU"rY COVERAGE FORM No. 1301 P. 5 (a) The preparing, approving, or failure - to prepare or approve, maps, shop drawings, opinions, reports, surveys, field orders, change orders, designs or drawings and specifications; or (b) Supervisory, Inspection, architectural or engineering activities. The limits of insurance that apply to additional insureds are described in Section D. - Limits Of Insurance. How this insurance applies when other insurance is available to an additionai insured is described in the Other Insurance Condition in Section E. — Liatliity And Medical Expenses General Conditions. No person of organization is an insured with respect to the conduct of any current or past partnership, joint venture or limited liability company that is not shown as a Named insured in the Declarations. D. LIABILITY AND MEDICAL EXPENSES LIMITS OF INSURANCE 1- The Most Wa Will Pay The Limits of Insurance shown in the Declarations and the rules below fix the most we will pay regardless of the number of: a. insureds; b. Cialms made or "suits" brought; of c. Persons or organizations making claims or bringing "suits". 2. Aggregate Limits The most we will pay for. a. Damages because of "bodily injury" and "properly damage" Included in the "products -completed operations hazard" is the Products -Completed Operations Aggregate Limit shown in the peclaratlons, b. Damages because of all other "bodily injury". "property damage" or "personal and advertisrng injury" including medical expenses, is the General Aggregate Limit shown in the Declarations. This General Aggregate Limit applies separately to each of your "locations" owned by or rented to you. •Location" means premises involving the same or connecting lots, or premises whose connection is interrupted only by a great, roadway or dght"af"way of a railroad. Page 14 of 24 This General Aggregate limit does not apply to "property damage" to premises whits rented to you or temporarily occupied by you with permission of the owner, arising out of fire, lightning or explosion. 3. Each Occurrence Limit Subject to 2.a. or 2.b above, whichever applies, the most we will pay for the sum of all damages because of all "bodily injury", "property damage" and medical expenses arising out of any One "Occurrence" is the Liability and Medical menses Limit shown in the Declarations. The most we will pay for aft medical expenses because of "bodily Injury" Sustained by any one person is the Medical Expenses Limit shown in the Declarations. 4. Personal And Advertising Injury Lhnit Subject to 2.b. above, the most we will pay for the sum of all damages because of all "personal and advertising injury" sustained by any one person or organization is the Personal and Advertising injury limit shown in the Declarations. 3- Damage To premises Rented To You Limit The Damage To Premises Rented To You Limit is the most we will pay under Business Uability Coverage for damages because of „properly damage" to any one premises. while rented to you, or in the case of damage by fire, lightning or explosion, while rented to you Or temporarily occupied by you with mission of the owner. In the case of damage by fire, lightning or explosion, the Damage to Premises Rented To You Limb applies to all damage proximately caused by the same event, whether such damage results from fire, lightning or explosion or any combination of these, G... How Limits Apply To Additional insureds The most we will'pay on behalf Of a person or organization who is an additional insured under this Coverage Part Is the lesser of: a. The limits of insurance specified in a written contract, written agreement or permit issued by a state or political subdivision; or b. The Limits of insurance shown in the Declarations. Such amount shall be a part of and not in addition to the Limits of Insurance shown in the Dedarations and described in this Section. Form SS 00 08 04 05 j 86 This Spectrum Policy consists of the Declarations, Coverage Forms, Common Policy Conditions and any 03 pother Forms and Endorsements issued to be a part of the Policy. This insurance is provided by the insurance BI company of The Hartford Insurance Group shown below. SBA INSURER: HARTFCRD CASUALTY I NSURANCE COMPANY HARTFCRD PLAZA, HARTFCRD, CT 06115 COMPANY CODE: 3 THE Policy Number: 30 SBA BI 0386 SA HARTFORD SPECTRUM POLICY DECLARATIONS OCPY rn Named Insured and Mailing Address: CCMBUSTI CN SCI ENCE & ENGI NEERI NG Cn o (No., Street, Town, State, Zip Code) SEE FCRM I H 12 00 8940 STATE RCUTE 108 STE L 0 CCLUM3IA MD 21045 0 m Policy Period` From 02/ 01/ 07 To 02/ 01/ 08 1 YEAR M 12:01 a.m., Standard time at your mailing address shown above. Exception: 12 noon in New Hampshire. FO 0 o Name of Agent/Broker: THE HCFFBERGER I NSURANCE CROUP o Code: 720463 0 0 N Previous Policy Number: 30 SBA BI 0386 Named Insured is: OCRPCRATI CN Audit Period: ANNUAL Type of Property Coverage: SPECIAL Insurance Provided: In return for the payment of the premium and subject to all of the terms of this policy, we agree with you to provide insurance as stated in this policy. i� TOTAL ANNUAL PREMIUM IS: I N RECOGNI TI ON CF THE MULTI PILE OWERAGES I NSURED W TH THE HARTFCRD, YOUR PCL I CY PREM UM I NCL UDES AN ACCCUNT CREDI T. S i� 1= Countersigned by Authorized Representative Form SS 00 02 1193 T Printed in U.S.A. (NS) Process Date: 12/ 13/ 06 Page 001 (OCNTI NUED CN NEXT PAGE) Policy Expiration Date: 02/ 01/ 08 Date UW CCPY OD 0 0 m w cM 0 in O M O O O N s s s s s SPECTRUM POLICY DECLARATIONS (Continued) POLICY NUMBER: 30 SBA BI 0386 BUSINESS LIABILITY LIMITS OF INSURANCE LIABILITY AND MEDICAL EXPENSES $2, 000, 000 MEDICAL EXPENSES - ANY ONE PERSON $ 10,000 PERSONAL AND ADVERTISING INJURY $2, 000, 000 DAMAGES TO PREMISES RENTED TO YOU $ 300,000 ANY ONE PREMISES AGGREGATE LIMITS PRODUCTS -COMPLETED OPERATIONS $4, 000, 000 GENERAL AGGREGATE $4,000,000 EMPLOYMENT PRACTICES LIABILITY COVERAGE: FCRM SS 09 01 EACH CLAIM LIMIT $ 5,000 DEDUCTIBLE - EACH CLAIM LIMIT NOT APPL I CABL E AGGREGATE LIMIT $ 5,000 RETROACTIVE DATE: 02012002 This Employment Practices Liability Coverage contains claims made coverage. Except as may be otherwise provided herein, specified coverages of this insurance are limited generally to liability for injuries for which claims are first made against the insured while the insurance is in force. Please read and review the insurance carefully and discuss the coverage with your Hartford Agent or Broker. The Limits of Insurance stated in this Declarations will be reduced, and may be completely exhausted, by the payment of "defense expense" and, in such event, The Company will not be obligated to pay any further "defense expense" or sums which the insured is or may become legally obligated to pay as "damages" . BUST NESS LI ABI LI TY CPTI CNAL COVERAGES UMBRELLA LI ABI LI TY - SEE SCHEDULE ATTACHED VW VER CF SUBROGATI CN: FCRM SS 12 15 LOCATI CN: 001 BUI LDI NC 001 SEE FCRM I H 12 00 Form SS 00 02 1193 T Printed in U.S.A. (NS) Page 005 (CCNTI NUED CN NEXT PAGE) Process Date: 12/ 13/ 06 Policy Expiration Date: 02/ 01/ 08 Insurer: HARTFCRD CASUALTY INSURANCE CCNPANY HARTFCRD PLAZA, HARTFCRD, CT 06115 PA. This Declarations Page, with Umbrella Liability Provisions and Endorsements, if any, issued to form a part thereof, shall together constitute this Umbrella Liability Supplemental Contract, which in turn forms a part of Policy Number shown below. None of the provisions of the policy to which this Supplemental Contract is attached applies to the Umbrella Liability Insurance provided hereunder. Wherever the word "policy' appears in this form or in endorsements attached to or made a part of this Supplemental Contract, it means "Supplemental Contract". N POLICY NUMBER: 30 SBA BI 0386 0 o DECLARATIONS Named Insured and Mailing Address: CCWBUSTI ON SCI ENCE & ENGI NEERI NG 0 SEE FCRM I H 12 00 Co 8940 STATE RCUTE 108 STE L 000 CCLUM31 A ND 21045 CV) m Policy Period From: 02/ 01/ 07 To: 02/ 01/ 08 M 12:01 A.M., Standard time at the address of the named insured as stated herein. o Premium $ INCLUDED ADVANCE, PREM UM N Self Insured Retention $10, 000 each occurrence The Limits of Insurance subject to all the terms of this policy that apply are: Each Occurrence $ 3,000,000 Products -Completed Operations Aggregate Limit $ 3, 000, 000 General Aggregate Limit (Other $ 3,000,000 Bodily Injury By Disease Aggregate Limit $ 3, 000, 000. than Products - Completed Operations, Bodily Injury By Disease and Automobile) Schedule of Underlying Insurance Policies See Attached "Extension Schedule of Underlying Insurance Policies" Form Numbers of Forms and Endorsements that apply. SX21820405 SX80020405 SX80040405 SX02150697 S)(21040697 SX21050697 SX21090603 SX21390604 SX21610697 SX21670300 SX24010401 Countersigned by Authorized Representative Form SX 80 01 06 97 T Printed in U.S.A. (NS) Process Date:. 12/ 13/ 06 Policy Expiration Date: 02/ 01/ 08 Date 4 4�9 17S CONSTRUCTION, TECHNICAL AND CNA PLANNING CONSULTANTS PROGRAM For All the Commitments You Makes POLICY DECLARATIONS AGENCY BRANCH PREFIX POLICY NUMBER INSURANCE IS PROVIDED BY CONTINENTAL CASUALTY COMPANY 333 S WABASH AVE, CHICAGO, IL 60604, 056125 969 MCH 25-401-63-47 A STOCK INSURANCE COMPANY, HEREIN CALLED WE, US, OR OUR. NOTICE THIS IS A CLAIMS -MADE POLICY. PLEASE READ THIS POLICY CAREFULLY AND DISCUSS THE COVERAGE WITH YOUR INSURANCE AGENT OR BROKER. NAMED INSURED: COMBUSTION SCIENCE & ENGINEERING, INC. CSE, INC. 2. ADDRESS: 8940 State Route 108 Suite L Columbia, Maryland 21045 3. POLICY TERM: From: 03/24/2007 To: 03/24/2008 AT 12:01 a.m. Standard time at your address shown above. 4. KNOWLEDGE DATE: 03/24/02 5. DEDUCTIBLE: a. $ 25,000 Purchased Deductible b. $ N/A Deductible Credit c. $ 25,000 is Deductible per claim (including claim expenses) d. $ N/A is Aggregate Deductible per policy year (including claim expenses) GSL2199 1 Ed. 10/05 ziU,7resentative nf1 �ff requirea) . civA " For All the Commitments You Make' DECLARATIONS CONTINUED Policy MCH 25-401-63-47 Effective 03/24/07 6. LIMIT OF LIABILITY: a. $ 2,000,000 Per claim limit of liability (including claim expenses) b. $ 2,000,000 Aggregate limit of liability per policy year (including claim expenses) 7. INCEPTION DATE: 03/24/02 is the date of the first policy issued to you and continuously renewed by us. 8. $ 4,896,556 is the Total Billings 9. Endorsements attached at policy effective date: G-136558-A19 State Provisions - Maryland GSL2202XX(10-05) Exclusion of Services for a Scheduled Entity GSL2200 Professional Liability Policy 10. - 11 - -- GSL2199 2 Ed. 10/05►.:::::::::.:::::::::::.:.; ��-fn'� L�ffr3�.c�T� 11S�aFFv�S r PRODUCER S FACT SHEET NAMED I NSURED: CCMBUSTI ON SCI ENCE & ENGI NEERI NG SEE FORM I H 12 00 POL #: 30 SBA BI 0386 SA PRODUCER S NAME: PRODUCER S CODE: 720463 THE HCFFBERGER INSURANCE GROUP PCL EFF DATE: 02/ 01 / 07 POL EXP DATE: 02/ 01 / 08 DIRECT ACCOUNT BI LL NUMBER - 10155268 TRANSACTI ON TYPE: RENEOAL TOTAL ANNUAL PREM UM NCLUDES TERRCR I SM PREM UM COW SSI CN BREAKDOVNJ ANNUAL PREM UM COVM SSI ON PERCENTAGE SPECTRUM TOTAL FORM TI TLE SS 00 01 04 93 PCLI CY FRCNT COVER SS 00 02 11 93 DECLARATIONS SS 00 05 04 05 CAMVIJN POL ICY CCNDI TI ONS SS 00 07 07 05 SPECI AL PROPERTY COVERAGE FOFW SS 00 08 04 05 BUSI NESS LI ABI LI TY COVERAGE FCRM SS 00 38 04 04 SUPPLEMENTAL SCHEDULE OF AUDI TABLE COVERAGES SS 84 32 04 06 SUPER STRETCH FOR BUSINESS SERVICES SUMMARY SS 01 16 03 92 MNRYLAND CHANGES SS 04 15 07 05 ORDINANCE OR LAW COVERAGE SS 04 19 07 05 BUSI NESS I NCCNE EXTENSI ON FOR OFF- PREM SES UTI LI TY SERVI CES SS 04 27 04 01 CONTRACTOR S TOOL COVERAGE SS 04 30 07 05 TRANSI T COVERAGE- PROPERTY I N THE CARE OF CARM ERS FOR FIRE SS 04 39 07 05 ACCOUNTS RECEIVABLE SS 04 41 07 05 C CIVPUTERS AND IVEDI A SS 04 42 07 05 EMPLOYEE DI SHCNESTY COVERAGE SS 04 44 07 05 CUTDOCR SI GNS SS 04 45 07 05 PERSONAL PROPERTY OF OTHERS SS 04 46 07 05 TEMPERATURE CHANGE SS 04 47 07 05 VALUABLE PAPERS AND RECORDS SS 04 78 07 05 BUST NESS I NCCME FROM DEPENDENT PROPERTI ES SS 04 80 03 00 CRI IVE COMMON CONDI TI ONS AND EXCLUSI CNS SS 04 85 04 01 SCHEDULED PRCPERTY COVERAGE SS 04 86 03 00 FORGERY COVERAGE SS 40 05 07 05 SUPER STRETCH FOR BUSINESS SERVICES SS 40 18 07 05 OFF- PREM SES UTI LI TY SERVICES - DIRECT DAMAGE SS 40 93 07 05 LI M TED FUND , BACTERI A OR VI RUS COVERAGE SS 41 12 09 05 1 DENTI TY RECOVERY COVERAGE FOR BUST NESS OM ERS I H 10 01 09 86 PER LS SPECI FI CALLY EXCEPTED SS 05 03 03 00 EXCLUSI ON - I NSPECTI ON AND APPRAI SAL SERVI CES SS 05 09 07 00 EXCLUSI ON - TESTI NG OR CCNSULTI NG ERRORS AND CM SSI ONS SS 05 47 09 01 EXCLUSI ON - NUCLEAR ENERGY LI ABI LI TY SS 50 04 06 04 EXCLUSI ON - SI LI CA PRODUCER S FACT SHEET PAGE 1 12/ 13/ 06 30 SBA BI 0386 SA (02/ 01 / 08) Lc) 0 'IT rn 0 0 0 0 co 0 eM O m 0 co 0 0 0 N PRODUCER S FACT SHEET (OONTI NUED) POL #: 30 SBA BI 0386 SA G 3251- 0 I NPCRTANT NOTI CE FOR M4RYLAND POLI CYHOLDERS I 12 00 11 85 SCHEDULED PRCPERTY SCHEDULE I H 12 00 11 85 LOSS PAYEE I H 12 00 11 85 AM TI ONAL INSURED I H 12 00 11 85 LOSS PAYEE I H 12 00 11 85 NAMED I NSURED I H 12 00 11 85 VW VER OF SUBROGATI CV PG 374- 0 I MPCRTANT NOTI CE TO POLI CYHOLDERS SS 09 01 09 00 EMPLOYMENT PRACTI CES LI ABI LI TY COk/ERAGE FORM SS 09 42 07 99 EMPLONNENT PRACTICES - EXCLUSION - PH OR ACTS SS 12 12 03 92 LOSS PAYABLE PROJI SI CNS SS 12 15 03 00 VAI VER OF SUBRCDATI C N SS 50 19 06 03 CAP ON LOSSES FROM CERTI FI ED ACTS OF TERRCRI SM SS 50 30 06 03 CAP ON LOSSES FRCM CERTI FI ED ACTS OF TERROR SM SS 50 52 09 01 ABSOLUTE PO LLUTI ON EXCLUSI ON SS 83 74 10 02 1 NPCRTANT NOT[ CE TO POLI CY HOLDERS - LI M TED FUND , BACTERI A AND VI RUS COVERAGE a VI L AUTHC H TY SS 83 94 07 04 SPECTRUM POLI CY ADJ USTM_NT NOTI CE 100722REV8 DI RECT BI LL I NFCRMIATI C N SX 80 01 06 97 UMBRELLA LI ABI LI TY SUPPLEMENTAL CONTRACT - POLI CY DECLARATI aVS PAGE SX 21 82 04 05 ABSCLUTE LEAD EXCLUSI ON SX 80 02 04 05 UMBRELLA LI ABI LI TY PC LI CY PRCVI SI ONS SX 80 04 04 05 EXTENSI ON SCHEDULE OF UNDERLYI NG I NSURANCE POLI Cl ES SX 02 15 06 97 AMENDMENT OF (ONDI TI ONS - M4RYLAND SX 21 04 06 97 EXCLUSI CV - CARE, CUSTODY OR CONTROL OF PERSONAL PROPERTY SX 21 05 06 97 EXCLUSI ON - CARE, CUSTODY OR CONTROL OF REAL PROPERTY SX 21 09 06 03 CAP ON LOSSES FRC M CERTI FI ED ACTS OF TERROR SM SX 21 39 06 04 EXCLUSI ON - SI LI CA SX 21 61 06 97 EMPLOYEE RETI RENENT I NCCME SEC URI TY ACT (ERI SA) SX 21 67 03 00 EXCLUSI ON - CCNSULTI NG ERRORS AND CM SSI ONS SX 24 01 04 01 FOLLOIV NG FORM ENDCRSEM=NT - AUTCM0BI LE LI ABI LI TY G 3187- 0 1 MPORTANT NOTI CE TO OUR. POLI CYHOLDERS SS 38 19 04 05 I NPORTANT NOTI CE TO PC LI CYHOLDERS - BUSI NESS LI ABI LI TY FORM CHANGES SS 38 25 09 05 POLI CYHOLDER NOTI CE - I DENTI TY RECOVERY COVERAGE SS 38 50 07 06 1 NPORTANT NOTI CE TO PCLI CYHOLDERS - EXCLUSI C NS - CARE, CUSTODY OR (ONTRCL CIF REAL AND PERSONAL PROPERTY SS 83 03 10 01 1 NPORTANT NOTI CE TO POLI CYHOLDERS - PREM UM DETERM NATI ON FOR SUBCCNTRACTCRS SS 83 76 02 06 DI SCLOSURE PURSUANT TO TERRC RI SM RI SK I NSURANCP ACT OF 2002 PRODUCER S FACT SHEET PAGE 2 12/ 13/ 06 30 SBA BI 0386 SA ( 02/ 01/ 08) Best's Rating Center - Company Information for Hartford Accident and Indemnity Company Page I of 2 View Ratings: Financial Strength Issuer Credit Securities Advanced Search Other Web Centers: Select One Hartford Accident and Indemnity Company LQ Print this pa (a member of Hartford Insurance Grouo) Assigned to companies that i ) A.I Sest ik 02230 NAIC #: 22M FON #: OW38MO have, in our opinion, a superior , ability to meet their ongoing Address: Hartford Plaza Hone: 860-547-5000 obligations to policyholders. 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View Ratings: Financial Strength Issuer Credit Securities Advanced Search Other Web Centers: Select One CNA Insurance Companies Print this pa (a member of CNA insurance Companies) Assigned to companies that 10 A.NLBest #: 18313 have, in our opinion, an Stock Ticker. New York Stock Exchange NYSE CNA excellent ability to meet their '�` Phone: 312-822-5000 wing obligations to A Address: CNA Center, 333 S. Wabash policyholders. Chicago, IL 60604 Fax: 312-822-5459 Web: www.cna.com Best's Ratings Financial Strength Ratings View Definitions Rating: A (Excellent) Financial Size Category: XV ($2 Billion or greater) Outlook: Stable Action: Affirmed Effective Date: April 18, 2007 * Denotes Under Review Best's Ratings Issuer Credit Ratings Yew Definitions Lang -Term: a Outlook: Stable Action: Affirmed Date: April 18, 2007 Reports and News Visit our NewsRoom for the latest news and press releases for this company and its A M. Best Group. I.- Best's Company Report - includes Best's Financial Strength Rating and rationale along with comprehensive 7"' analytical commentary, detailed business overview and key financial data. Report Revision Date: 05/182007 (represents the latest significant change). Historical Reports are available in Best's Company Report Archive. nBesrs Executive Summary Reports (Financial Overview) - available in three versions, these presentation style reports feature balance sheet, income statement, key financial performance tests including profitability, liquidity and reserve analysis. Data Status: 2007 Best's Statement File - P/C, US. Contains data compiled as of 8/152007 (Quality cross Checked). • Single Company - five years of financial data specifically on this company. • Comparison - side -by -side financial analysis of this company with a peer group of up to five other companies you select • Composite - evaluate this company's financials against a peer group composite. Report displays both the average and total composite of your selected peer group. AMB Credit Report - Business Professional - provides three years of key financial data presented with �F colorful charts and tables. Each report also features the latest Bests Ratings, Rating Rationale and an excerpt from our Business Review commentary. Data Status: Contains data compiled as of 8/152007 (Quality cross checked). Best's Key Rating Guide Presentation Report - includes Best's Financial Strength Rating and financial data as provided in Best's Key Rating Guide products. Data Status: 2006 Financial Data (Quality Cross Checked). Financial and Analytical Products Best's PrODertv/Casualty Center- Premium Data & ReDortS Best's Key Rating Guide - P/C. US & Canada Best's Statement File - P/C, US Best's Statement File - Global Best's _Insurance Reports - P/C. US & Canada Best's State Line - P/C. US 1>ittp:f/www3 . ambest. com/ratings/FullProfil e.asp?B1=0&AMBNum=18313&AltSrc=1 &AltNum=&DRAT... 8/23/2007 4305 Santa Fe Avenue, Vernon, California 90058 Telephone (323) 583-8811 September 11, 2007 Combustion Science & Engineering, Inc. Attn: Michael S. Klassen 8940 Old Annapolis Road, Suite L Columbia, MD 21045-2129 Re: Services Agreement Dear Mr. Klassen: The insurance requirements have been met. Transmitted herewith is a fully executed agreement as referenced above, approved by City Council on August 6, 2007, through Resolution No. 9371. If you have any questions regarding this matter, please call Mr. Donal O'Callaghan at 323/583-8811 ext. 834. Very truly yours, f f Very A-1 n City Clerk NG:dr c: Donal O'Callaghan Dolores Jaunzemis Resolution No. 9371 Agreement File No. 07-076 ,Kcfusivefy Industriaf 4305 Santa Fe Avenue, Vernon, California 90058 Telephone (323) 583-8811 August 13, 2007 Combustion Science & Engineering, Inc. Attn: Michael S. Klassen 8940 Old Annapolis Road, Suite L Columbia, MD 21045-2129 Re: Professional Services Agreement Dear Mr. Klassen: In accordance with Section 5 of said agreement, you are to furnish the City with proof of insurance. Please submit your insurance documents to Willard Yamaguchi, Risk Manager, for review and approval. Upon approval of said documentation, this office will forward to you a fully executed duplicate original agreement. If you have any questions, please contact Willard Yamaguchi at 323/583-8811 ext. 175. ,,Very truly yours, Ne q �o City Clerk NG:dr c: Willard Yamaguchi Donal O'Callaghan Resolution No. 9371 Agreement File No. 07-076 EaCcfusivefy Industfiaf