2020-PPP033 Execution Version PRIVILEGED AND CONFIDENTIAL PUERTO RICO TRANSMISSION AND DISTRIBUTION SYSTEM OPERATION AND MAINTENANCE AGREEMENT dated as of June 22, 2020 by and among THE PUERTO RICO ELECTRIC POWER AUTHORITY as Owner, THE PUERTO RICO PUBLIC-PRIVATE PARTNERSHIPS AUTHORITY as Administrator, LUMA ENERGY, LLC as ManagementCo, and LUMA ENERGY SERVCO, LLC as ServCo CONFIDENTIAL TABLE OF CONTENTS Page ARTICLE 1 DEFINITIONS; INTERPRETATION ................................................................ 2 Definitions........................................................................................................ 2 Interpretation; Construction ........................................................................... 32 ARTICLE 2 PURPOSE; EFFECTIVE DATE; TERM ......................................................... 34 Purpose ........................................................................................................... 34 Effective Date ................................................................................................ 34 Term ............................................................................................................... 35 ARTICLE 3 OWNERSHIP OF THE T&D SYSTEM ........................................................... 36 Ownership ...................................................................................................... 36 Engagement of Operator ................................................................................ 36 Use of T&D System ....................................................................................... 36 Liens ............................................................................................................... 36 Right of Access .............................................................................................. 36 Exclusivity ..................................................................................................... 37 Essential Public Service ................................................................................. 37 Reporting Obligations .................................................................................... 37 Qualified Management Contract .................................................................... 37 ARTICLE 4 FRONT-END TRANSITION PERIOD ............................................................. 40 Front-End Transition Period Generally ......................................................... 40 ManagementCo Responsibilities ................................................................... 44 Owner and Administrator Responsibilities .................................................... 49 Governmental Approvals and Tax Matters .................................................... 51 Conditions Precedent to Service Commencement Date ................................ 52 Front-End Transition Period Compensation .................................................. 55 Closing the Front-End Transition Period ....................................................... 57 Failure of Service Commencement Date Conditions ..................................... 57 Subcontractors During the Front-End Transition Period ............................... 60 ARTICLE 5 O&M SERVICES ................................................................................................ 62 Services Generally ......................................................................................... 62 System Contracts ........................................................................................... 62 Billing and Collection .................................................................................... 63 System Remediation ...................................................................................... 64 -i- CONFIDENTIAL TABLE OF CONTENTS (continued) Page Capital Improvements .................................................................................... 64 System Regulatory Matters ............................................................................ 66 Safety and Security ........................................................................................ 68 Labor and Employment; Employee Benefits ................................................. 69 Procurement and Administration of Federal Funding ................................... 69 Environmental, Health and Safety Matters .................................................... 71 Accounting and Financial Services ................................................................ 73 Legal Matters ................................................................................................. 73 Generation-Related Services .......................................................................... 73 Emergency Action ......................................................................................... 75 Information .................................................................................................... 76 Bill Payments ................................................................................................. 77 Compliance with Obligations ........................................................................ 77 Energy Policy under Act 17 ........................................................................... 78 Acquisition of Easements, Fee Interests and Concession Rights .................. 78 Other Services ................................................................................................ 79 ARTICLE 6 RIGHTS AND RESPONSIBILITIES OF OWNER AND ADMINISTRATOR ..................................................................................... 80 Rights and Responsibilities of Owner............................................................ 80 Rights and Responsibilities of Administrator ................................................ 82 Reporting; Audits ........................................................................................... 83 Staffing Levels ............................................................................................... 84 ARTICLE 7 COMPENSATION; BUDGETS ......................................................................... 86 Service Fee ..................................................................................................... 86 Pass-Through Expenditures ........................................................................... 88 Budgets .......................................................................................................... 88 Budget Policy ................................................................................................. 90 Service Accounts ........................................................................................... 91 Disallowed Costs ........................................................................................... 96 Unfunded Amounts ........................................................................................ 97 Owner Credit Rating ...................................................................................... 97 Owner Payment of Administrator Costs ........................................................ 98 ARTICLE 8 CREDIT SUPPORT ............................................................................................ 99 Guarantee ....................................................................................................... 99 Guarantor Reports .......................................................................................... 99 -ii- CONFIDENTIAL TABLE OF CONTENTS (continued) Page ARTICLE 9 COMPLIANCE WITH APPLICABLE LAW ................................................ 100 Compliance Obligations ............................................................................... 100 Anti-Corruption and Sanctions Laws........................................................... 100 Commonwealth Requirements ..................................................................... 101 Non-Discrimination Laws ............................................................................ 101 Non-Collusion and Acceptance ................................................................... 101 Commonwealth Tax Liabilities .................................................................... 101 Certifications Required by Commonwealth Contractor Requirements ....... 101 Duty to Inform of Criminal Investigations .................................................. 101 Act 120 ......................................................................................................... 102 ARTICLE 10 INSURANCE.................................................................................................... 103 Insurance Generally ..................................................................................... 103 Commercial Availability .............................................................................. 103 Additional Named Insureds ......................................................................... 103 Warranties .................................................................................................... 104 Certificates of Insurance, Policies and Notice ............................................. 104 ARTICLE 11 SUBCONTRACTORS AND CONTRACTORS ........................................... 105 Ability to Subcontract and Contract ............................................................ 105 Subcontract and Contract Terms .................................................................. 106 Indemnity