GUARANTEED ENERGY PERFORMANCE SAVINGS CONTRACT. By and Between. [Guaranteed Energy Performance Savings COMPANY] and [AGENCY] [Date]

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Transcription:

GUARANTEED ENERGY PERFORMANCE SAVINGS CONTRACT By and Between [Guaranteed Energy Performance Savings COMPANY] and [AGENCY] [Date]

Table of Contents CONTENTS...ii RECITALS...1 SECTION 1. DEFINITIONS...2 SECTION 2. INCORPORATION...4 SECTION 3. COMMENCEMENT DATE AND TERMS; INTERIM PERIOD...5 SECTION 4. PAYMENTS TO COMPANY...5 SECTION 5. FISCAL FUNDING...8 SECTION 6. SCOPE OF WORK...10 SECTION 7. WARRANTIES AND LIABILITIES...11 SECTION 8. TRAINING BY COMPANY...12 SECTION 9. PERMITS AND APPROVALS...12 SECTION 10. PERFORMANCE BY COMPANY...12 SECTION 11. OWNERSHIP...13 SECTION 12. FACILITIES MAINTENANCE...14 SECTION 13. EQUIPMENT SERVICE...14 SECTION 14. UPGRADING OR ALTERING THE EQUIPMENT...14 SECTION 15. PROPERTY/CASUALTY/INSURANCE...15 SECTION 16. BOND...16 SECTION 17. EVENTS OF DEFAULT...17 SECTION 18. REMEDIES UPON DEFAULT...17 Guaranteed Energy Performance Savings Contract ii

SECTION 19. ASSIGNMENT...18 SECTION 20. ARBITRATION...18 SECTION 21. REPRESENTATIONS AND WARRANTIES...19 SECTION 22. MISCELLANEOUS...20 INDEX OF SCHEDULES, EXHIBITS, APPENDICES...23 Schedule A Equipment to Be Installed by Company...24 Schedule B Schedule C Schedule D Schedule E Description of Facilities; Pre-existing Equipment Inventory...25 Energy Saving Guarantee...26 Deliverables and Compensation to Company...27 Baseline Energy Consumption...28 Schedule F Savings Calculation Formulae; Methodology to Adjust Baseline...29 Schedule G Construction and Installation Schedule...32 Schedule H Standards of Comfort...33 Schedule I Company's Maintenance Responsibilities...34 Schedule J Schedule K Schedule L Agency's Maintenance Responsibilities...35 Company's Training Responsibilities...36 Third Party Financing Agreement...37 EXHIBITS Exhibit I Performance Bond...38 Exhibit II (i) Exhibit II (ii) Certificate of Acceptance Technical Audit...41 Certificate of Acceptance Installed Equipment...42 Guaranteed Energy Performance Savings Contract iii

Exhibit III Equipment Warranties...43 Exhibit IV Corporate Guarantee...44 Guaranteed Energy Performance Savings Contract iv

APPENDICES Appendix A Appendix B Appendix C Procurement Solicitation Documents Company Proposal Technical Energy Audit MODEL ATTACHMENTS Schedule C Schedule L Exhibit I Model Energy Saving Guarantee and Model Schedules D, F, H Model Third Party Financing Agreement Model Performance Bond (Exhibit I) and Certificate of Acceptance (II(ii)) Guaranteed Energy Performance Savings Contract v

GUARANTEED ENERGY PERFORMANCE SAVINGS CONTRACT This Guaranteed Energy Performance Savings Contract (the Contract ) is made and entered into as of the day last executed below, at, in the County of, State of Florida, by and between guaranteed energy performance savings Company, ("Company"), having its principal offices at, and ("Agency") with its principal offices at, for the purpose of installing certain energy saving equipment,, and providing other services designed to save energy for the Agency's property and buildings. RECITALS WHEREAS, Agency [describe ownership interest, e.g. owns and operates] the Facilities, and is in need of energy saving equipment and services designed to save energy and associated energy costs at its property and buildings ( Facilities ) and requires that the operating cost savings of such energy saving equipment and services will meet or exceed the costs of energy conservation measures; and WHEREAS, Company has developed or become knowledgeable about certain procedures for controlling energy consumption through the use of technical energy audits and engineering analyses and devices, installed and maintained at the Facilities, and has guaranteed to Agency that it will install energy saving equipment for an annual savings that will meet or exceed total annual contract payments, and WHEREAS, Company has made an assessment of the energy consumption characteristics of the Facilities and existing Equipment described in Schedule B, which Agency has approved. WHEREAS, Agency desires to retain Company to purchase, install and service certain energy efficiency equipment of the type or class described in Schedule A, attached hereto and made part hereof, and to provide other services for the purpose of achieving energy cost reductions within it s Facilities, as more fully set forth herein; and WHEREAS, Company has guaranteed to Agency that it will install energy saving equipment for a cost that will not exceed Agency s Baseline Energy Consumption reflected on Schedule E, as of Commencement Date, and WHEREAS, Agency desires to compensate Company for its services based upon the value of energy and operations savings that are obtained; and WHEREAS, Agency is authorized under the laws of the State of Florida to enter into this Contract for the purposes set forth herein. NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, and intending to be legally bound hereby, Agency and Company hereto covenant and agree as follows: Guaranteed Energy Performance Savings Contract 1

SECTION 1. DEFINITIONS. Section 1.1. Definitions. The following terms have the meanings specified below unless the context clearly requires otherwise: Agency" means the State of Florida, a municipality, or a political subdivision thereof, which has entered into this Contract, or any governmental entity succeeding to the powers and duties of any of the foregoing pursuant to law or governmental reorganization. Annual Reconciliation means a determination pursuant to Section 4, as to whether a shortfall in annual energy cost savings or an excess in annual energy cost savings exists based on the provisions of Company s written energy savings guarantee reflected in Schedule C (Energy Savings Guarantee) with savings calculated according to Schedule F (Savings Calculation Formula). Annual Excess Savings means, pursuant to Sec. 489.145 (3)(d)(2), Florida Statutes, the amount of any actual annual savings that exceed total annual contract payments made by the Agency for the Contract for such calendar year. Baseline Energy Consumption means the Agency s Baseline Energy Consumption reflected on Schedule E, which shall include energy consumption for each month of the calendar year preceding the initial contract year. Company means the guaranteed energy performance savings Company from whom Agency has ordered or with whom Agency has contracted for the commodities and services under this Contract. Commencement Date means date of receipt by Company of Agency s Certificate of Acceptance to Company under this Contract, and the Lender makes payment, if applicable, under Schedule L. "Energy Conservation Measure" or ECM means the measures actually being undertaken by the Company under this Contract, more specifically delineated in Exhibits A, I and/or K, and can include, but is not limited to any other items listed in Sec. 489.145 (3) (b), Florida Statutes. "Energy Cost Savings" means a measured reduction in the cost of fuel, and energy consumption, and stipulated operation and maintenance costs, if applicable, created from the implementation of the Energy Conservation Measures when compared with an established baseline for the previous cost of fuel, and energy consumption, and stipulated operation and maintenance costs, pursuant to Sec. 489.145(3) (c), Florida Statutes. Equipment means all items of property described in the Schedule of Equipment to be Installed (Schedule A) and any other items of property pursuant to Sec. 489.145(3) (b), Florida Statutes. Guaranteed Energy Performance Savings Contract 2

Equipment Group means the Equipment listed in a particular Schedule A, Equipment to be Installed by Company. An Equipment Group may not be smaller than an auditable unit nor greater than a Facility. With respect to each Equipment Group this Contract, together with the Agency Certificate of Acceptance, and the fully executed Description of Facilities relating thereto, shall constitute a separate contract relating to such Equipment Group. With respect to any Equipment Group, the payment due from Agency to either the Company, or a Lender under any Financing Agreement, on each Payment date is shown in the Schedule D, Compensation, or Schedule L, Financing Agreement, completed for such Equipment Group. Facilities means the state-owned Facilities as described in the first paragraph of this Contract and reflected on Schedule B. A Facility must be a distinct auditable unit, measurable by the FEMP standards referenced in Section 4.2. Fiscal Year means [insert fiscal period used by Agency for its financial accounting and budgeting purposes.] Guarantee means the Company s Energy Savings Guarantee reflected on Schedule C, whereby the Company guarantees that the Energy Cost Savings will meet or exceed the costs of the Energy Conservation Measures. Each funded Equipment Group shall constitute a Transaction for purposes of the Guarantee. "Interim Period means the period from contract execution until the Commencement Date. (See Sec. 3.1) Legally Available Funds means funds duly appropriated or otherwise legally available for the purpose of making payments under this Contract. Non-Appropriation means the failure of an appropriation or availability of the Governing body of Agency or the Legislature to appropriate money for any Fiscal Year sufficient for the continued performance by Agency of all of Agency 's obligations under this Contract as evidenced by the passage of a final budget which does not include funding sufficient to pay all payments due. Parties means both the Agency and the Company collectively. Savings Calculation Formula means the Company s Savings Calculation Formula reflected on Schedule F, which is based on the life cycle cost calculations provided in Section 255.255, Florida Statutes. State Agency means - each state department, departmental unit described in Section 20.04, Florida Statutes, commission, regional planning agency, board, district, and authority. Technical Energy Audit means, pursuant to Section 489.145(4)(b), Florida Statutes, a report attached as Appendix C hereto, that summarizes the costs associated with of the Energy Conservation Measures Guaranteed Energy Performance Savings Contract 3

and provides an estimate of the amount of the Energy Cost Savings. Term : the term of this Contract shall commence on the date of execution by the Parties and shall be automatically renewed yearly, on each Fiscal Year, through and including [up to twenty (20)] years conditioned upon Legally Available Funds. SECTION 2. INCORPORATION Section 2.1. Schedules, Exhibits and Appendices. Company has prepared and Agency has approved and accepted the Schedules as set forth below, copies of which are attached hereto and made a part of this Contract by reference. Schedules Schedule A Schedule B Schedule C Schedule D Schedule) Schedule E Schedule F Schedule G Schedule H Schedule I Schedule J Schedule K Schedule L Exhibits Exhibit I Exhibit II (i) Exhibit II (ii) Exhibit III Exhibit IV Appendices Appendix A Appendix B Appendix C Equipment to be Installed by Company Description of Facilities; Pre-Existing Equipment Inventory Energy Savings Guarantee Deliverables and Compensation to Company (Deliverables and Payment Baseline Energy Consumption Savings Calculation Formula; Methodology to Adjust Baseline Construction and Installation Schedule Standards of Comfort Company s Maintenance Responsibilities Agency s Maintenance Responsibilities Company s Training Responsibilities Financing Agreement Performance Bond/Construction Bond Certificate of Audit Acceptance -Technical Audit Certificate of Acceptance Installed Equipment Equipment Warranties Corporate Guarantee Procurement Solicitation Documents Company Proposal Technical Energy Audit Section 2.2. Other Documents. This Contract incorporates herein and makes a part hereof the following documents, listed in their order of precedence in the event of a conflict between the terms and conditions of any of the contract documents as follows: Guaranteed Energy Performance Savings Contract 4

1- This Contract 2- All remaining Schedules and Exhibits, incorporated herein 3- Company s Technical Audit approved pursuant to Section 1.4 (Appendix C) 4- Company s Proposal in response to the Procurement Solicitation Documents and addenda (Appendix B) Section 2.3. Energy Management Plan. Company has, under separate agreement, submitted the complete Technical Energy Audit and analysis of the Premises attached as Appendix C and dated, which have been approved and accepted by Agency as set forth in Exhibit II (i) (Certificate of Audit Acceptance Technical Audit). The audit includes all energy conservation measures agreed upon by the parties. SECTION 3. COMMENCEMENT DATE AND TERMS; INTERIM PERIOD Section 3.1. Commencement Date. Each Equipment Group in each Facility shall have its own individual Commencement Date which shall be the first day of the month after the month in which all schedules are in final form and accepted by Agency and Company shall have delivered a notice to Agency that it has installed and commenced operating all of the Equipment in the Equipment Group in accordance with the provisions of Schedule G (Construction and Installation Schedule); and Agency has inspected and accepted said installation and operation as evidenced by the Certificate of Acceptance Installed Equipment as set forth in Exhibit II (ii). Agency s obligation begins to accrue for service and maintenance under this Contract as set forth in Schedule D (Deliverables and Compensation to Company) on [mm/dd/yyyy] pursuant to Schedule D or Schedule L (Financing Agreement), if applicable, from the Commencement Date. Section 3.2. Term of Contract; Interim Period. Subject to the following sentence, the term of this Contract shall be one year, automatically renewable yearly for [up to twenty (20)] years measured beginning with the Commencement Date (Term). Nonetheless, the Contract shall be effective and binding upon the parties immediately upon its execution, and the period from contract execution until the Commencement Date shall be known as the "Interim Period". Savings calculations begin upon Agency acceptance, as evidenced by delivery of Exhibit II(ii). Savings during the Interim Period will be included in the initial savings calculations under Schedule F. The initial year of the Term shall commence as of the Commencement Date and expire on the last day of the Fiscal Year. Subsequent renewal years of the Term shall be based on the Fiscal Year. For the purpose of calculating the amount of actual Energy Cost Savings achieved at the Facilities, the Annual Reconciliation Date for this Contract shall be December 31 of each year that the Contract is in effect. For Equipment procured by the Agency from Company during a year, annual Energy Cost Savings shall be prorated for that one year to make it coincide with the next December 31. SECTION 4. PAYMENTS TO COMPANY Section 4.1. Energy Savings Guarantee. Company has formulated and provided a written Guarantee that the Energy Cost Savings will meet or exceed the costs of the Energy Conservation Guaranteed Energy Performance Savings Contract 5

Measures pursuant to Section 489.145(4)(c), Florida Statutes, and that the amount of any actual annual savings meet or exceed total annual contract payments made by the agency for the contract pursuant to Section 489.145 (3)(d)(2), Florida Statutes. The Guarantee is attached as Schedule C, providing the annual level of Energy Cost Savings to be achieved as a result of the Energy Conservation Measures provided for in this Contract and in accordance with the Savings Calculation Formula as set forth in Schedule F, which is calculated in compliance with Florida law. The Guarantee is set forth in annual increments for the term of the Contract as specified in Schedule C and has been structured so as to be sufficient to cover any and all annual payments required to be made by the Agency as set forth in Schedule D (Compensation to Company) and, if applicable, Schedule L (Financing Agreement). Section 4.2. Review and Reimbursement/Reconciliation. Section 4.2.1 Review and Reimbursement/Reconciliation. Pursuant to Sec. 489.145(5)(e), Florida Statutes, the Company is required to provide to the Agency an annual reconciliation of the guaranteed energy cost savings. Within sixty (60) days after the end of each calendar year, Company will deliver to the Agency s Contract Manager, identified in Section 22.9, a reconciliation report for such year, reflecting the amount guaranteed and the amount of actual Energy Cost Savings achieved. Upon delivery of the report and all supporting documentation, Agency will have thirty (30) business days to accept or reject this yearly reconciliation. Agency shall provide written notice of such rejection, within the stated acceptance period, specifying the basis of the deficiency. Company shall have twenty (20) business days to cure such deficiency and deliver to the Agency a corrected yearly reconciliation. A Monitoring and Verification plan shall be jointly constructed using the Federal Energy Management Program s (FEMP) M&V Guidelines: Measurement and Verification for Federal Energy Management Projects version 2.2. This plan shall be to determine whether annual savings have been recognized. Any disputes shall be resolved by arbitration pursuant to Section 20. If the Agency fails to reject any yearly reconciliation (including corrected reconciliations) within 30 business days of receipt of all required documentation, Agency shall be deemed to have accepted the reconciliation as of the final day of the 30th business days unless a longer acceptance period is mutually agreed upon in writing. Section 4.2.2 Annual Reconciliation. If the Annual Reconciliation reveals a shortfall in annual Energy Cost Savings, the Company is liable for such shortfall, and shall pay to the Agency the amount by which the Agency s actual energy costs exceeded guaranteed savings set forth in Schedule C. The Company shall remit such payments to the Agency within sixty (60) days of written notice by the Agency of such monies due. If the Company fails to make such payment to the Agency within days after demand therefore, Agency may offset payments in the event of Company-financing, or in the event of third-party financing, demand payment pursuant to the instrument identified in Schedule C (Energy Savings Guarantee) provided as security for the Company s Guarantee. If the Annual Reconciliation reveals Annual Excess Savings, the excess savings may be allocated under Section 4.4 below. Annual Excess Savings shall be shared only at calendar years end and only to the extent provided in Section 4.4. Section 4.3. Company Compensation and Fees. Company has structured the Energy Guaranteed Energy Performance Savings Contract 6

Savings Guarantee so as to be sufficient to include any and all annual payments required to be made by the Agency in connection with financing/purchasing the Equipment to be installed by Company under this Contract as set forth in Schedule D (Deliverables and Compensation to Company), if applicable ( Payments ). Section 4.4. Annual Excess Savings. Annual Excess Savings shall be distributed as follows: (1) % of such shall first be applied to reimburse Company for any payment Company made to Agency to meet Company's guarantee for previous years (but not subsequent years) in which the Energy Cost Savings fell short of Company's Energy Savings Guarantee under the terms as set forth in Schedule C (Energy Savings Guarantee), (2) then applied to prepay the payments due pursuant to Schedule D (Compensation to Company) or, if applicable, Schedule L (Financing Agreement), and if no such payments are due, (3) then applied in equal amounts to the parties. Section 4.5. Agency Payments. Agency agrees to payments based on actual energy savings not to exceed the payment amortization schedule as set forth in Schedule D (Deliverables and Compensation to Company), or Schedule L (Financing Agreement), if applicable. Thirty days after the Agency formally accepts the installed equipment according to Sec. 3.1, and has received from the Company certificates of title and the Certificate of Acceptance, the Company can submit its first monthly invoice. Agency shall pay Company within the time limits established in Section 489.145(5)(f), Florida Statutes, as set forth in Schedule D (Deliverables and Compensation to Company), or pay the Lender pursuant to Schedule L (Financing Agreement), if applicable. All other payment and contract provisions of Section 287.058 (1), Florida Statutes, are incorporated herein by reference. In the event Agency fails to make payment within forty (40) days of the due date, Agency shall pay as late charges any interest assessed for untimely payment. The interest rate will be the rate set pursuant to Section 55.03, Florida Statutes. Agency shall not be required to begin any payments to Company under this Contract unless and until all equipment installation is completed by Company and accepted by Agency as evidenced by the signed Certificate of Acceptance? Installed Equipment as set forth in Exhibit II (ii). Agency shall pay Company pursuant to Section 215.422, Florida Statutes. At least one twentieth of the price must be paid within two years from the date of complete installation and acceptance (Commencement Date) by the state, that the remaining costs are to be paid at least quarterly, not to exceed a 20 year term, based on life cycle cost calculations and that the savings are guaranteed to the extent necessary to make payments for the systems. Section 4.6 Financing. In the event the parties have agreed to a separate Financing Agreement with a third party, incorporated herein as Schedule L, the Agency is financing the acquisition, which constitutes the Agency s source of funding for its obligations under the Contract. The Company may not assess any late fees for an Agency failure to deliver the completed documents to the Lender unless the Company has provided all invoices and other documentation required under Schedule L on a timely basis to the Agency. Section 4.7 Acceptance of Installed Equipment. When the Company considers the Equipment to be Installed complete including all contractual requirements, the Company shall notify the Guaranteed Energy Performance Savings Contract 7

Agency in writing and request that the Agency prepare a Certificate of Acceptance. Within ten (10) business days from receipt of the Company s written notification, the Agency will make an inspection to determine whether the Equipment Group to be installed is complete. If the Agency determines the Equipment Group to be installed is not complete, the Agency will provide the Company with a specific material performance deficiency list of all items that must be corrected or completed before the Agency would consider the Equipment to be Installed complete. An executed Certificate of Acceptance or deficiency list will be provided to the Company within fifteen (15) business days from receipt of the Company s written notification. If the Company receives a deficiency list and once the Company has completed all items on the deficiency list, the Company can request a second inspection by the Agency to verify the Equipment Group to be installed is complete. Again the re-inspection shall occur within ten (10) business days and a written response within fifteen (15) business days. When the Equipment Group to be installed is considered completed, the Agency will provide the Company a Certificate of Acceptance, which shall establish the Commencement Date. The Parties intent that a Certificate of Acceptance will be executed for each Equipment Group to be installed as soon as the installation is complete and beneficial use is provided. It is anticipated and agreed, that the Agency may require use of some installed and completed equipment, prior to the completion of all Equipment to be installed. In such situations, the parties will conduct acceptance inspections and Certificates of Acceptance as described above, for that Equipment Group to be installed which is being operated and the Agency is receiving beneficial use. When so used and accepted, the maintenance and repair due to ordinary wear and tear caused by such used will be made at the expense of the Agency. Any completion payments for such Equipment being operated and used by the Agency shall be for Equipment increments no smaller than an entire Equipment Group. Section 4.8 Current Expense. Agency's obligation to make Payments hereunder constitutes a current obligation payable exclusively from Legally Available Funds and shall not be construed to be an indebtedness within the meaning of any applicable constitutional or statutory limitation or requirement. Neither Agency nor the State nor any political subdivision or agency thereof has pledged any of its full faith and credit or its taxing power to make any Payments under this Contract. Section 4.9 Baseline Costs. Actual savings are measured against baseline costs, the expenses that the Agency would have incurred had the delivery order not been implemented. Baseline costs are established as part of the measurement and verification methodology, which shall be based on the Federal Energy Management Program s (FEMP) M&V Guidelines: Measurement and Verification for Federal Energy Management Projects version 2.2. Details of the Monitoring and Verification plan shall be agreed upon by the Company and Agency and documented in the Technical Energy Audit. SECTION 5. FISCAL FUNDING Section 5.1. Termination. (a) Termination. Guaranteed Energy Performance Savings Contract 8

(i) In the event of Non-Appropriation, this Agreement and each Equipment Group Schedule D there under with respect to which such Non-Appropriation has occurred, shall terminate, and, at the option of Company, provided in writing to Agency by Company, may terminate, in whole, but not in part, as to all Equipment listed thereon, effective upon the last day of the Fiscal Year for which funds were appropriated, in the manner and subject to the terms specified in this Section. Company may effect such termination by giving the other party a written notice of termination at which time Agency shall pay to Company any payments ( Payments ) and other amounts that are due and have not been paid at or before the end of its then current Fiscal Year with respect to this Agreement. Agency shall endeavor to give reasonable notice of such termination prior to the end of the Fiscal Year for which appropriations were made, and shall notify Company of any anticipated termination upon its determination thereof. In the event of termination of this Agreement as provided in this Section, Agency shall comply with Section 5.1(b). (ii) This Agreement is subject to termination upon the occurrence of an event of default, as provided in Section 17 hereof. (iii) No Equipment Group Schedule shall be executed after any Non-Appropriation or Event of Default with respect to a defaulting Agency or an Agency as to which a Non-Appropriation has occurred. (b) Intent To Continue Term; Appropriations. (i) Agency intends to continue the Agreement hereunder for its entire Term and to pay all Payments relating thereto. The Agency agrees to direct the person within such Agency in charge of preparing the Agency's budget to include in the budget request for each Fiscal Year the Payments becoming due in such Fiscal Year. The parties acknowledge that appropriation for Payment is a governmental function that the Agency cannot contractually commit the governing body of Agency to perform and this Agreement does not constitute such a commitment. However, the Agency reasonably believes that money in an amount sufficient to make all Payments can and will lawfully be appropriated and made available to permit continued utilization of the Equipment in the performance of its essential functions during the applicable Terms. (ii) Agency is an agency of the State and Agency's performance and obligation to pay under this Agreement is contingent upon an annual appropriation. Agency, as an agency of the State, is subject to the appropriation of funds by the governing body of the Agency in an amount sufficient to allow continuation of its performance in accordance with the terms and conditions of this Agreement for each and every Fiscal Year following the Fiscal Year in which the Agreement is in effect. Agency shall, upon receipt of notice that sufficient funds are not available to continue its full and faithful performance under this Agreement, provide prompt written notice to Company of such event and upon the expiration of the period of time for which funds were appropriated be thereafter released of all further obligations in any way related to such Equipment. Agency agrees to include in its appropriation request each year of the Agreement a request for an appropriation to fund the Agreement and any applicable Equipment Guaranteed Energy Performance Savings Contract 9

Schedule D. (iii) In the event that the appropriations has not been adopted by the governing body of the Agency prior to the expiration of a Fiscal Year, and no declaration of an intent not to appropriate has been made by the Agency, the Term of this Agreement will be deemed renewed pending the enactment of such appropriations act. If any Payments are due under this Agreement during such period, such Terms will be so extended only if: (a) an interim or emergency budget implemented by the governing body of the Agency pending enactment of a final budget makes available to the Agency money that may legally be used to make Payments during such period; or (b) sums are otherwise available to make such Payments. (c) Effect of Termination for Non-Appropriation. Upon termination of this Agreement for Non- Appropriation as provided in this Section, Agency shall not be responsible for the payment of any additional Payments coming due in succeeding Fiscal Years, but if Agency has not complied with the instructions received from Company in accordance with Section 5.1(e), the termination shall nevertheless be effective, and Agency shall pay, on demand to Company, from Legally Available Funds, the unpaid balance of the Agreement which is stipulated to be the aggregate of the Principal Balances as shown on Schedule D as of the last day of the Fiscal Year for which funds were appropriated. (d) No Waiver of Sovereign Immunity. Nothing herein shall be construed as waiving the sovereign immunity of the State of Florida or any agency or instrumentality thereof. (e) In the event of termination of this Contract as provided in this Section, Agency shall comply with the following: (i) Company may by written notice to Agency, and, if Agency is a State Agency, also to the Chief Financial Officer (CFO), request that Agency, within thirty (30) days of such written notice, cause all Equipment in an Equipment group that is subject to the defaulted Contract as to that Equipment Group, such Equipment (together with all documents necessary to transfer legal and beneficial title thereto to Company) to be delivered to Company or Company's designee at a place in the State designated by Company. If Agency fails or refuses to voluntarily transfer such Equipment to Company as herein provided, to the extent permitted by law, Company shall have the right to obtain a judgment against Agency from Legally Available Funds for compensatory damages in the amount of the then applicable Principal Balances as shown on the applicable Schedule D. If the Equipment or any portion of it has been destroyed or damaged beyond repair, Agency shall pay the applicable Principal Balance of the damaged or destroyed Equipment as set forth in the Equipment Schedule relating thereto to Company only to the extent not covered by insurance to be obtained by Agency. (ii) Upon failure of Agency to voluntarily comply with Section 5.1(e)(i), Company shall have whatever rights and remedies are available at law, if any, against Agency's Legally Available Funds. Company and Agency agree that there is no intention to create under this Contract a right in Company to dispossess Agency involuntarily of the legal title to or the use of the Equipment. Company hereby irrevocably waives any right to specific performance of Agency's covenant to transfer legal title Guaranteed Energy Performance Savings Contract 10

to and return possession of the Equipment to Company. SECTION 6. SCOPE OF WORK Section 6.1 Construction and Equipment (a) Company shall install certain Equipment in Agency s Facilities pursuant to specifications in Appendices A and B. Construction and equipment installation shall proceed in accordance with the Construction Schedule approved by Agency and attached hereto as Schedule G. (b) Inspection and acceptance will be at destination unless otherwise provided. Title and risk of loss or damage to all items shall be the responsibility of the Company until accepted by the Agency, unless loss or damage results from negligence by the Agency. The Company shall be responsible for filing, processing and collecting all damage claims. (c) Upon substantial completion, the Agency shall promptly issue a Certificate of Acceptance (Exhibit IIii), along with a punch-list of items necessary for final acceptance. Section 6.2 Maintenance. Company shall be responsible for maintaining certain energy saving Equipment, described in Schedule A, pursuant to Schedule I, Company s Maintenance Responsibilities. Section 6.3 Records and Data (a) Agency has furnished or shall furnish (or cause its energy suppliers to furnish) to Company, upon its request, all of its records and complete data concerning energy usage and energy-related maintenance for the Facilities described in Schedule B. During the Term of the Contract, Agency will provide Company copies of all energy bills [at least annually]. Upon receipt of same, Company shall calculate the amount of actual Energy Cost Savings achieved for use in determining the Annual Reconciliation pursuant to Section 4.2.2. (b) Reports to be issued by Company to the Agency are more particularly delineated in Schedule D, Deliverables. At a minimum, following reports shall be provided on an annual basis: (i) by Company: the Energy Cost Savings calculated in accordance with Schedule F, the Savings Calculation Formula (ii) by Agency: copies of all energy bills showing Agency energy usage (c) Work in Progress. In the event this Contract is terminated for any reason, all finished or unfinished documents, data, studies, correspondence, reports and any other products prepared for the purpose of performing this Contract, shall be made available to, or delivered to, Agency for its use. SECTION 7. WARRANTIES AND LIABILITIES Guaranteed Energy Performance Savings Contract 11

Section 7.1 Equipment warranties Company covenants and agrees that all equipment to be installed as part of this Contract shall be new, in good and proper working condition and protected by appropriate original equipment manufacturer (OEM) written warranties covering all parts and equipment performance. Company further agrees to deliver to the Agency for inspection and approval, all such written warranties and to obtain extended OEM warranties for a minimum of [at the discretion of the Agency], and which shall be attached and set forth as Exhibit III (Equipment Warranties). All warranties shall be transferable and extend to the Agency. The warranties shall specify that only new, and not reconditioned parts, may be used and installed when repair is necessary. All warranties required hereunder shall be in force for a minimum of one year from the Commencement Date. Notwithstanding the above, nothing in this Section shall be construed to alleviate/relieve the Company from complying with its obligations to perform under all terms and conditions of this Contract and as set forth in all attached Schedules. Section 7.2 Liability: Company shall hold and save the Agency, the State of Florida, its officers, agents, and employees harmless against claims by third parties resulting from Company s breach of this Contract or Company s negligence. Section 7.3 Liability: Both parties recognize that the Agency, as an agency of the State of Florida, is prohibited from entering into indemnification agreements. Company shall not be responsible for damages resulting solely and exclusively from Agency s negligence. Section 7.4. Limitation of Liability: Neither party shall be liable to another for special, indirect, consequential or punitive damages, even if the party has been advised that such damages are possible. No party shall be liable for lost profits, lost revenue, or lost institutional operating savings. Notwithstanding the foregoing, nothing in this section will be construed to impose any limitation prohibited by Rule 6A-1.006(3), Florida Administrative Code. SECTION 8. TRAINING BY COMPANY The Company shall conduct the training program described in Schedule K hereto. The training specified in Schedule K must be completed prior to acceptance of the Equipment installation. The Company shall provide ongoing training whenever needed with respect to updated or altered Equipment, including upgraded software as defined by the software manufacturer. Such training shall be provided at cost calculated using open book pricing method, Attachment B in the Master Audit Agreement. SECTION 9. PERMITS AND APPROVALS Guaranteed Energy Performance Savings Contract 12

Agency shall cooperate with Company in obtaining all necessary permits and approvals for installation of the Equipment. In no event shall Agency, however, be responsible for payment of any permit fees. The equipment and the operation of the equipment by Company shall at all times conform to all federal, state and local code requirements. Company shall furnish copies of each permit or license which is required to perform the work to the Agency before the Company commences the portion of the work requiring such permit or license. SECTION 10. PERFORMANCE BY COMPANY Company warrants that all work performed complies with customary, reasonable and prudent standards of care in accordance with standards in the industry and must perform its services in a professional manner and consistent with Agency supplied equipment specifications and standards. Company shall perform all tasks/phases under the Contract, including construction, and install the Equipment in such a manner so as not to harm the structural integrity of the buildings or their operating systems and so as to conform to the Standards of Comfort set forth in Schedule H and the Construction Schedule specified in Schedule G. Company shall repair and restore to its original condition any area of damage caused by Company's performance under this Contract. The Agency reserves the right to review the work performed by Company and to direct Company to take certain corrective action if the structural integrity of the Facilities or its operating system is or will be harmed. All costs associated with such corrective action to damage caused by Company's performance of the work shall be borne by Company. Company shall remain responsible for the professional and technical accuracy of all services performed, whether by the Company or its subcontractors or others on its behalf, throughout the term of this Contract. SECTION 11. OWNERSHIP Section 11.1. Ownership of Certain Proprietary Property Rights. Agency shall not, by virtue of this Contract, acquire any interest in any formulas, patterns, devices, secret inventions or processes, copyrights, patents, other intellectual or proprietary rights, or similar items of property which are or may be used in connection with the Equipment. The Company shall grant to the Agency all rights for the duration of this Contract for any and all software or other intellectual property rights necessary for the Agency to continue to operate, maintain, and repair the Equipment in a manner that will yield maximal energy consumption reductions. Section 11.2. Ownership of Existing Equipment. Ownership of the equipment and materials presently existing at the Facilities at the time of execution of this Contract shall remain the property of the Agency even if it is replaced or its operation made unnecessary by work performed by Company pursuant to this Contract. The Company shall be responsible for the disposal of all equipment and materials designated by the Agency as disposable off-site in accordance with all applicable laws and regulations regarding such disposal. Guaranteed Energy Performance Savings Contract 13

Section 11.3 Ownership of Installed Equipment. After the Commencement Date and during the term of any Third Party Financing Agreement pursuant to Schedule L or financing of the Equipment pursuant to Schedule D (Deliverables and Compensation to Company), legal title to and ownership of all Equipment and any and all repairs, replacements, substitutions and modifications thereto shall be in Agency, and the Company shall take all actions necessary to vest such title and ownership in Agency. Section 11.4 Patent and Copyright. Company, without exception, shall indemnify and save harmless the Agency and its employees from liability of any nature or kind, including cost and expenses for or on account of any copyrighted, patented, or unpatented invention, process or article supplied by the Company. Company has no liability when such claim is solely and exclusively due to the combination, operation or use of any article supplied hereunder with equipment or data not supplied by Company or is based solely and exclusively upon the Agency s alteration of the article. The Agency will provide prompt written notification of a claim of copyright or patent infringement and will afford Company full opportunity to defend the action and control the defense. Further, if such a claim is made or is pending the Company may, at its options and expenses procure for the Agency the right to continue use of, replace or modify the article to render it noninfringing. (If none of the alternatives are reasonably available, the Agency agrees to return the article on request to the Company and receive reimbursement, if any, as may be determined by a court of competent jurisdiction.) If Company uses any design, device, or materials covered by letters, patent or copyright, it is mutually agreed and understood without exception that the negotiated prices shall include all royalties or costs arising from the use of such design, device, or materials in any way involved in the work. SECTION 12. FACILITIES MAINTENANCE Agency agrees that it shall adhere to, follow and implement the energy conservation procedures and methods of operation to be set forth on Schedule J (Agency s Maintenance Responsibilities), to be attached hereto and made a part hereof after Agency's approval. SECTION 13. EQUIPMENT SERVICE Section 13.1. Actions by Company. Company shall provide service, repairs, and adjustments to the Equipment installed under terms of this Contract, if any, pursuant to Schedule I, Company s Maintenance Responsibilities. Agency shall incur no cost obligations to the Company for Equipment service, repairs, and adjustments, except as set forth in Schedule D (Compensation to Company), provided, however, that when the need for Company maintenance or repairs principally arises due to the negligence or willful misconduct of the Agency or any employee or other agent of Agency, and Company can so demonstrate such causal connection, Company may charge Agency for the actual cost of the maintenance or repair insofar as such cost is not covered by any warranty or insurance proceeds. Section 13.2. Actions by Agency. Agency shall not move, remove, modify, alter, or change in any way the Equipment or any part thereof without the prior written approval of Company except as set forth in Schedule J (Agency s Maintenance Responsibilities). Notwithstanding the foregoing, Agency may take reasonable steps to protect the Equipment if, due to an emergency, it is not possible or Guaranteed Energy Performance Savings Contract 14

reasonable to notify Company before taking any such actions. In the event of such an emergency, Agency shall take reasonable steps to protect the Equipment from damage or injury and shall follow instructions for emergency action provided in advance by Company. Agency agrees to maintain the Facilities in good repair and to protect and preserve all portions thereof that may in any way affect the operation or maintenance of the Equipment. If Company contends that Agency is not performing maintenance responsibilities in accordance with Schedule J, or that Agency has made any other material changes, including a change in manner of use, hours of operation for the equipment, permanent changes in the comfort and service parameters, occupancy or structure of the premises, types and quantities of equipment at the Premises, then Company shall submit a report to the Agency and the Agency shall determine what, if any, adjustments to baseline will be made. Company shall submit any dispute arising from this determination to arbitration pursuant to Section 20. SECTION 14. UPGRADING OR ALTERING THE EQUIPMENT Company shall at all times have the right, subject to Agency's prior written approval, which approval shall not be unreasonably withheld, to change the Equipment, revise any procedures for the operation of the equipment or implement other energy saving actions in the Facilities, provided that (i) such modifications or additions to, or replacement of the Equipment, and any operational changes, or new procedures are necessary to enable the Company to achieve the energy savings at the Facilities and; (ii) any cost incurred relative to such modifications, additions or replacement of the Equipment, or operational changes or new procedures shall be the responsibility of the Company. All modifications, additions or replacements of the Equipment or revisions to operating or other procedures shall be made by written amendment to the Contract pursuant to Section 255.258, Florida Statutes. SECTION 15. PROPERTY/CASUALTY/INSURANCE Section 15.1. Insurance. At all times during the term of this Contract, Company shall maintain in full force and effect, at its expense: (1) Workmen's Compensation Insurance sufficient to cover all of the employees of Company working to fulfill this Contract, and (2) Casualty and Liability Insurance on the Equipment and Liability Insurance for its employees and the possession, operation, and service of the Equipment. The limits of such insurance shall be not less than for injury to or death of one person in a single occurrence and for injury to or death of more than one person in a single occurrence and for a single occurrence of property damage. Such policies shall name the Agency as an additional insured. Prior to commencement of work under this Contract, Company will be required to provide Agency with current certificates of insurance specified above. These certificates shall contain a provision that coverages afforded under the policies will not be canceled or changed until at least thirty (30) days' prior written notice has been given to Agency. The policies for Bodily Injury and Property Damage Liability Insurance shall be written to include Contractual Liability Insurance to protect Company against claims from the operations of subcontractors. Certificates of Company s insurance containing evidence of the Hold Harmless Clause Guaranteed Energy Performance Savings Contract 15

protecting the State shall be filed with the State and shall be subject to its approval for adequacy of protection. Section 15.2. Damage. Company shall be responsible for (i) any damage to the Equipment or other property on the Facilities and (ii) any personal injury where such damage or injury occurs as a result of Company's performance under this Contract, but only to the extent caused by the acts or omissions of the Company. Section 15.3. Liability. Company shall save and hold harmless Agency and its officers, agents and employees or any of them from any and all claims, demands, actions or liability of any nature but only to the extent caused by the acts or omissions of the Company, its agents or employees under this Contract. Section 15.4. Insurance Policy Guarantee. In the event an insurance policy is selected to support the Schedule C, Guarantee, such policy shall be in an amount equal to the amount of the Guarantee during the remaining term of the Guarantee Period. It shall name the state as a beneficiary and shall provide that payment shall be made to the Agency upon presentation to the Insurer of one or more properly executed Agency Shortfall Payment Demands. It shall provide that the Insurer may conclusively rely as to the completeness and accuracy of all statements in such Agency Shortfall Payment Demands. The Insurer shall not be required to make any inquiry, inspection or investigation in connection therewith. In the event a dispute as to an Annual Reconciliation shortfall is resolved pursuant to Section 20 in the Company s favor, the Company will first reimburse the Insurer upon distribution of the arbitration award pursuant to the arbitration order. SECTION 16. BOND Section 16.1. The Agency shall be provided with the following bonds, within 30 days of the Effective Date: (a) Construction Bond: Company shall furnish the Agency a Construction Bond, substantially in the form provided in Exhibit I, in the amount of $[total retrofit costs]. The Construction Bond shall remain in effect until the Equipment is accepted by the Agency as provided in Exhibit II (ii). (b) Surety Bond: In the event a Surety Bond is selected to support the Schedule C Guarantee, Company shall furnish the Agency a Surety Bond equal to the amount of the Guarantee during the remaining term of the Guarantee Period. As security for payment under the Company s guarantee, Company shall provide to Agency such surety bond provided by an institution assigned one of the two highest policyholder ratings accorded insurers by A.M. Best & Company or any comparable service. Each surety bond shall be payable to the Agency, or available to be drawn upon by it upon failure of the Company to make payment in accordance with Section 4.2. If a disbursement is made under the surety bond, it shall be the obligation of the Company, and not the Agency, to reimburse the provider of the instrument. The Company shall at all times maintain the surety bond in effect in an amount sufficient to cover the amount of the Guarantee during the remaining term of the Guarantee Period. Guaranteed Energy Performance Savings Contract 16