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AG 02-116 7~bù ~~~, I TOQlyIrMltAl4Slt1 - - q i ~IP CITY ~FED ERAL WAY LAW D EP ARTMENT Ó2- q/1~ ~Q90NTRACT P PARATIONIDOCUMENT REVIEW/SIGNATURE ROUTING SLIP 1. ORIGINATING DEPT./DIV: fì'V /5trut'7 2. ORIGINATING STAFF PERSON: t'1At1fWlU1 )úJ/'Jtlm EXT: ~ 3. DATEREQ.BY: CONTRACT SIGNATURE ROUTING ~LAW DEPARTMENI I !¡{CITYMANAGE~~~ O~ Þ! CITY CLERK fO 10 02.-. ~ / (j It ó / tfI"l- M SIGN COpy BA K 0 ORGINATING DEPT. k - - z.-' :!J- Q! ASSIGNED AG# 02 - ¡liD 0 PURCHASING: PL¥SI' CHARGE TO: ~ / A 0R1 G I N A L ~ f7& q¡ro{ÐZ-- iD/IO/(J2, . I ~ F;:;~;: ~",:" ~~ A)?#- ~ ~ ~ I I : MS ,..,. ...~ j, i& . - n ""^- k 1k" 4.b~","",,^"A I... ~ SDfoll<.4 7l~ð --_.J-.t:40.¿ \~~r..x- .,\ """"Ùt Rb""f'< ~ 04/04/02 . \uS...r""u.., IIIS",r....<-<. IHI<-<..."'" ~ tc:so~""'}c.:\ -It:<: t.s><s/Yl.<.J;:.h;y, ZJrf.~~ 5.('1.""ð . 10/1"'/Ol: (vItJ¥1¡J?LVl .sl/ou._¡fv~"Sfn..oh M.tr Wl~,,",~+t.:t:- PSE:, ;5 ctD"'ð dv,W-~ "t(.r ~ NO ;:l~""'"- ~,;;ntJ( ~'Dt5,fP'L' -FI"3' ,'t!, 4. 5. 6. 7. 8. 9. 10. 11. TYPE OF DOCUMENT REQUESTED (CHECK ONE) 0 PROFESSIONAL SERVICE AGREEMENT 0 MAINTENANCEILABOR AGREEMENT 0 PUBLIC WORKS CONTRACT 0 SMALL PUBLIC WORKS CONTRACT (LESS THAN $200.000) 0 PURCHASE AGREEMENT) 0 SECURITY DOCUMENT (EG. AGREEMENT & PERFIMAIN BOND; ASSIGNMENT OF FUNDS IN LIEU OF BOND) 0 CONTRACTOR SELECTION DOCUMENT (E.G.. RFB, RFP, RFQ) 0 CONTRACT AMENDMENT 0 CDBG J(OTHER~ett [:f~~n ~r((rnod: PROJECT NAME: Po.c16v ~hWíL!J ,CXJuH-J¡ Hpl/ LIlrKS/ £kfl~ 1 NAME OF CONTRACTOR~ r:V\UJjY fi\,x ADDRESS: ~1J.:j S II . q~Dn mÆi'H8NE(~)~b,~g%, SIGNATURE AME: TITLE AG#: (MATERIALS, SUPPLIES, EQUIPMENT) 0 REAL ESTATE DOCUMENT ATTACH ALL EXHIBITS AND CHECK BOXES 0 SCOPE OF SERVICES 0 ALL EXHIBITS REFERENCED IN DOCUMENT 0 INSURANCE CERTIFICATE 0 DOCUMENT AUTHORIZING SIGNATURE TERM: COMMENCEMENT DATE: COMPLETION DATE: TOTAL COMPENSATION $ . (INCLUDE EXPENSES AND SALES TAX, IF ANY) (IF CALCULATED ON HOURLY LABOR CHARGE - ATTACH SCHEDULES OF EMPLOYEES TITLES AND HOLIDAY RATES) REIMBURSABLE EXPENSE: 0 YES 0 NO IF YES, MAXIMUM DOLLAR AMOUNT: $ IS SALES TAX OWED 0 YES 0 NO IF YES, $ PAID BY: 0 CONTRACTOR 0 CIT CONTRACT REVIEW It PROJECT MANAGER ß/Jo/Gt- ~~ ~~~ G~ *A~ATE APPROVED ø It:>. I æ.- INITIALIDATE APPROVED ~ not.<...£' g/~/oe- ~ , , INITIALIDATE APPROVED WN U-60 Issued: June 26, 2002 Effective: July 1, 2002 Attachment "A" to Schedule 74, Page 1 PUGET SOUND ENERGY Attachment "A" - Project Design Agreement Ær;¡.# OJ. -II(P SCHEDULE 74 UNDERGROUND CONVERSION AGREEMENT THIS Agreement, dated as of this Jœday of OL~à~1t;( ,2002, is made by and between the CITY OF FEDERAL WAY, a Municipal Corporation (the "Government Entity"), and PUGET SOUND ENERGY, Inc., a Washington Corporation (the "Company"). RECITALS A. The Company is a public service company engaged in the sale and distribution of electric energy and, pursuant to its franchise or other rights from the Government Entity, currently locates its electric distribution facilities within the jurisdictional boundaries of the Government Entity. B. The Government Entity is considering conversion of the Company's existing overhead electric distribution system to a comparable underground electric distribution, as more specifically described in the Scope of Work (as defined in paragraph 2, below) furnished to the Company by the Government Entity (the "Conversion Project"). C. The Government Entity has requested that the Company perform certain engineering design services and otherwise work cooperatively with the Government Entity to develop a mutually acceptable Project Plan (as defined in paragraph 6, below) for the Conversion Project, in accordance with and subject to the terms and conditions of this Agreement (the "Design Work"). D. The Govemment Entity and the Company wish to execute this written contract in accordance with Schedule 74 of the Company's Electric Tariff G ("Schedule 74") to govern the Design Work for the Conversion Project. AGREEMENT The Government Entity and the Company therefore agree as follows: 1. Unless specifically defined otherwise herein, all terms defined in Schedule 74 shall have the same meanings when used in this Agreement. 2. The Government Entity shall, within ten (10) business days after the date of this Agreement, provide the Company with a written scope of work for the Conversion Project which includes, among other things, (a) a reasonably detailed description of the scope of the work required for the Conversion Project, (b) a list of the key milestone dates for the Conversion Project, (c) reasonably detailed drawings showing any associated planned improvements to the Public Thoroughfare, and (d) a statement as to whether the Government Entity desires to install the ducts and vaults for the Conversion Project (the "Scope of Work"). The Government Entity shall provide the Company two (2) hard copies of the Scope of Work and a copy of the relevant electronic filets) in a mutually agreed electronic format. 3. Within ten (10) business days of its receipt of the Scope of Work, the Company shall prepare and submit to the Government Entity (a) a reasonably detailed, good faith estimate of the cost to perform the Design Work (the "Design Cost Estimate"), and (b) a proposed schedule for completion of the Schedule 74 Design Agreement City of Federal Way: Hwy.99 Ph.2 Conversion #101010669 ORIGINAL WN U-60 Issued: June 26, 2002 Effective: July 1, 2002 Attachment "A" to Schedule 74, Page 2 PUGET SOUND ENERGY Design Work which, to the extent reasonably practicable, reflects the applicable key milestone dates specified in the Scope of Work and provides for completion of the Design Work within ninety (90) business days from the date the Company receives the Government Entity's notice to proceed under paragraph 5, below (the "Design Schedule"). The proposed Design Cost Estimate and the proposed Design Schedule shall be based upon the then-current Scope of Work. Unless otherwise specified in the Scope of Work, the Design Work shall not include negotiation or acquisition of third party property rights but shall include preliminary planning between the Company and the Government Entity regarding their respective obligations for negotiating and acquiring third party property rights. 4. Within ten (10) business days after the Government Entity's receipt of the proposed Design Cost Estimate and the proposed Design Schedule from the Company, the Government Entity and the Company shall meet in order to (a) review the proposed Design Cost Estimate, (b) review the proposed Design Schedule; (c) review the Scope of Work, and (d) make any changes necessary to create a final Scope of Work, final Design Cost Estimate, and final Design Schedule that are reasonably acceptable to both parties. If the parties are unable to agree upon a final version of the Scope of Work, Design Cost Estimate, and/or Design Schedule, then either party may, by written notice to the other party, submit the matter for resolution pursuant to the dispute resolution procedures in paragraph 16, below. The final Scope of Work, Design Cost Estimate and Design Schedule, once determined in accordance with this paragraph 4, may thereafter be changed or amended only in accordance with the change procedures set forth in paragraph 13, below. 5. The Government Entity shall, within ten (10) business days after determination of the final of the Scope of Work, Design Cost Estimate, and Design Schedule, issue (a) a written notice to proceed which shall delineate the final Scope of Work, Design Cost Estimate, and Design Schedule, or (b) a written notice to terminate this Agreement without cost to the Government Entity. If the Government Entity terminates this Agreement, the costs incurred by the Company in preparing and submitting the Design Cost Estimate and the Design Schedule shall not be reimbursable to the Company, and the rights and obligations of the parties under this Agreement shall be terminated in their entirety and without liability to either party. 6. Following the Company's receipt of the notice to proceed, and within the applicable time period specified in the Design Schedule, the Company shall, with the cooperation and assistance of the Government Entity as outlined in this Agreement, prepare a project plan for the Conversion Project (the "Project Plan") which shall include, among other things, the following: (a) a detailed description of the work that is required to be performed by each party and any third party in connection with the Conversion Project (the "Construction Work"), (b) the applicable requirements, drawings, and specifications for the Construction Work, (c) a description of any operating and other property rights that are required to be obtained by each party for the Conversion Project (and the requirements and specifications with respect thereto), (d) a detailed estimate of the costs to be incurred by each party in its performance of the Construction Work, and (e) a detailed schedule for completing the Construction Work (including, without limitation, the dates for delivery of the ducts and vaults and other materials for use at the site of the Construction Work). 7. The Government Entity shall be responsible for coordinating the Design Work with all other design work to be performed in connection with the Conversion Project and any associated planned improvements to the Public Thoroughfare. The parties shall work together in an effort to mitigate the costs of the Conversion Project to each party, including, without limitation, identifying ways to accommodate the facilities of the Company to be installed as part of the Conversion Project within the Public Thoroughfare. Schedule 74 Design Agreement City of Federal Way: Hwy.99 Ph.2 Conversion #101010669 WN U-60 Issued: June 26, 2002 Effective: July 1, 2002 Attachment "A" to Schedule 74, Page 3 PUGET SOUND ENERGY 8. Within the applicable time period specified in the Design Schedule, the Company shall prepare and submit to the Government Entity a proposed initial draft of the Project Plan. The parties understand and acknowledge that the proposed Project Plan submitted by the Company shall be preliminary in nature and shall not include, without limitation, information required to be supplied by the Government Entity (e.g., scope and estimate of the cost of the Construction Work to be performed by the Government Entity). 9. Within the applicable time period specified in the Design Schedule, the Government Entity shall (a) review the proposed Project Plan submitted by the Company, (b) complete any information required to be supplied by the Government Entity, (c) make any changes required to conform the proposed Project Plan to the Scope of Work and this Agreement, and (d) return the amended Project Plan to the Company. 10. Within the applicable time period specified in the Design Schedule, the Company shall review the amended Project Plan submitted by the Government Entity and notify the Government Entity in writing of either the Company's acceptance of, or the Company's specific objections to, the amended Project Plan. If the Company makes any objection to the amended Project Plan, and the parties are unable to resolve the objections and mutually agree upon the Project Plan prior to the final design date specified in the Design Schedule, then either party may, by written notice to the other party, submit the matter for resolution pursuant to the dispute resolution procedures in paragraph 16, below. The Project Plan, as mutually agreed upon by the parties or established through the dispute resolution process, shall be attached to and incorporated in a Project Construction Agreement substantially in the form attached hereto as Exhibit A (the "Construction Agreement") which is to be signed by the parties prior to commencement of the Construction Work. 11. The parties intend and agree that the Design Work and the Project Plan in its final form shall conform to the following requirements: (a) The Project Plan shall, if requested by the Government Entity in its initial Scope of Work, specify that the Government Entity shall install the ducts and vaults for the Conversion Project; provided that (i) the parties mutually agree upon and set forth in the Project Plan (A) the costs of such installation work to be included in the Cost of Conversion, and (B) the specifications and standards applicable to such installation work, and (ii) such installation work is accomplished by the Government Entity in accordance with the applicable design and construction specifications provided by the Company and set forth in the Project Plan. (b) Each estimate of the costs to be incurred by a party shall, at a minimum, be broken down by (i) the design and engineering costs, (Ii) property and related costs, including any costs of obtaining operating rights, and (Iii) construction costs, including and listing separately inspection, labor, materials, and equipment. (c) All facilities of the Company installed as part of the Conversion Project shall be located, and all related property and operating rights shall be obtained, in the manner set forth in the applicable provisions of Schedule 74. The Project Plan shall describe in detail the location of such facilities, any related property and operating rights required to be obtained, and the relative responsibilities of the parties with respect thereto. (d) The schedule set forth in the Project Plan for completing the Construction Work shall include, at a minimum, milestone time periods for completion of the Trenching, installation of ducts and vaults, the construction and removal of any Temporary Service, and the removal of overhead facilities. Schedule 74 Design Agreement City of Federal Way: Hwy.99 Ph.2 Conversion #101010669 WN U-60 Issued: June 26, 2002 Effective: July 1, 2002 Attachment "A" to Schedule 74, Page 4 PUGET SOUND ENERGY (e) The Project Plan may include the specification of work and requirements for Government- Requested Upgrades and Company,lnitiated Upgrades; provided, however, that the costs incurred by the Company with respect to the design and engineering of Company-Initiated Upgrades shall not be included in the costs reimbursable to the Company under this Agreement or the Construction Agreement. For purposes of the foregoing, (i) the term "Government- Requested Upgrade" shall mean any feature of the Underground Distribution System which is requested by the Government Entity and is not reasonably required to make the Underground Distribution System comparable to the overhead distribution system being replaced, and (ii) the term "Company-Initiated Upgrade" shall mean any feature of the Underground Distribution System which is required by the Company and is not reasonably required to make the Underground Distribution System comparable to the overhead distribution system being replaced. For purposes of subparagraph (ii), above, a "comparable" system shall include, unless the parties otherwise agree, the number of empty ducts (not to exceed two (2), typically having a diameter of 6" or less) of such diameter and number as may be specified and agreed upon in the final Scope of Work necessary to replicate the load-carrying capacity (system amperage class) of the overhead system being replaced. For purposes of subparagraph (i), above, any empty ducts installed at the request of the Government Entity shall be a Government-Requested Upgrade. (f) The Project Plan shall set forth all specifications, design standards and other requirements for the Construction Work and the Conversion Project, including, but not limited to, the following: (i) applicable federal and state safety and electric codes and standards, (ii) applicable construction and other standards of the Company, and (iii) applicable street design and other standards of the Government Entity which are in effect as of the commencement of the Conversion Project. 12. Upon request of the Government Entity, and in any event at the times specified in the Design Schedule, the Company shall provide periodic reports which compare the actual costs of the Design Work incurred to that point in time to the Design Cost Estimate, as changed or amended in accordance with paragraph 13, below. Further, if at any time the Company reasonably expects that the actual cost of the Design Work will exceed the Design Cost Estimate, as changed or amended in accordance with paragraph 13, below, the Company shall notify the Government Entity immediately. Upon receipt of the Company's notice, the Government Entity may, at its option, (a) notify the Company in writing that this Agreement is terminated; or (b) request a reasonably detailed explanation supported by documentation (reasonably satisfactory to the Government Entity) to establish that the actual costs in excess of the Design Cost Estimate are: (i) reasonable, (ii) consistent with the Scope of Work, and (iii) consistent with sound engineering practices. If the Government Entity requests an explanation, the Government Entity shall, within ten (10) business days after receipt of the explanation, (a) change the Scope of Work in accordance with paragraph 13, below, or (b) direct the Company to continue with the Design Work without a change in the Scope of Work, but reserving to the Government Entity the right to dispute the reasonableness of the costs to be paid the Company under paragraph 14, below, in accordance with the dispute resolution procedures in paragraph 16, below, or Schedule 74 Design Agreement City of Federal Way: Hwy.99 Ph.2 Conversion #101010669 WN U-60 Issued: June 26, 2002 Effective: July 1, 2002 Attachment "A" to Schedule 74, Page 5 PUGET SOUND ENERGY (c) direct the Company to discontinue performing the Design Work pending resolution, pursuant to paragraph 16, below, of any dispute regarding the reasonableness of the costs, in which event the Design Schedule will be adjusted to reflect the delay, or (d) notify the Company in writing that this Agreement is terminated. In the event the Government Entity terminates this Agreement or discontinues the performance of the Design Work under subparagraph (c), above, for more than ninety (90) days, the Government Entity shall pay the Company for all costs incurred by the Company in its performance of the Design Work prior to the date the Company receives the Government Entity's notice of termination, plus any costs incurred by the Company for materials and other items ordered or procured by the Company with the prior authorization of the Government Entity in order to meet the schedule for the Conversion Project. The foregoing payment obligation shall survive any termination of this Agreement. 13. (a) Either party may, at any time, by written notice thereof to the other party, request changes to the Scope of Work (a "Request for Change"). No Request for Change shall be effective and binding upon the parties unless signed by an authorized representative of each party. If any approved Request for Change would cause an increase in the cost of, or the time required for, the performance of any part of the Design Work, an equitable adjustment in the Design Cost Estimate and the Design Schedule shall be made to reflect such increase. The parties shall negotiate in good faith with the objective of agreeing in writing on a mutually acceptable equitable adjustment. If the parties are unable to agree upon the terms of the equitable adjustment, either party may submit the matter for resolution pursuant to the dispute resolution procedures in paragraph 16, below. Notwithstanding any dispute or delay in reaching agreement or arriving at a mutually acceptable equitable adjustment, each party shall, if requested by the other party, proceed with the Design Work in accordance with the Request for Change. Any such request to proceed must be accompanied by a written statement setting forth the requesting party's reasons for rejecting the proposed equitable adjustment of the other party. (b) The Design Cost Estimate and/or the Design Schedule shall be equitably adjusted from time to time to reflect any change in the costs or time required to perform the Design Work to the extent such change is caused by: (I) any Force Majeure Event under paragraph 17, below, (if) the discovery of any condition within the Conversion Area which affects the scope, cost, schedule or other aspect of the Design Work and was not known by or disclosed to the affected party prior to the date of this Agreement, or (iii) any change or inaccuracy in any assumptions regarding the scope, cost, schedule or other aspect of the Design Work which are expressly identified by the parties in the final Scope of Work. Upon the request of either party, the parties will negotiate in good faith with the objective of agreeing in writing on a mutually acceptable equitable adjustment. If, at any time thereafter, the parties are unable to agree upon the terms of the equitable adjustment, either party may submit the matter for resolution pursuant to the dispute resolution provisions in paragraph 16, below. 14. Upon completion of the Design Work (I.e., the date on which the Project Plan is final under paragraph 10, above, either by mutual agreement of the parties or as established through the dispute resolution procedures), the Government Entity shall pay the Company all actual, reasonable costs to the Company for the Design Work (which, if disputed in good faith by the Government Entity, may be submitted by either party for resolution pursuant to the dispute resolution provisions in paragraph 16, below), plus any costs incurred by the Company for materials and other items ordered by the Company with the prior authorization of the Government Entity in order to meet the schedule for the Conversion Project. Schedule 74 Design Agreement City of Federal Way: Hwy.99 Ph.2 Conversion #101010669 WN U-60 Issued: June 26, 2002 Effective: July 1, 2002 Attachment "A" to Schedule 74, Page 6 PUGET SOUND ENERGY If, thereafter, the Construction Agreement is executed by the parties and the Conversion Project is completed within five (5) years from the date of this Agreement, the full amount of the costs incurred by the Company in its performance of the Design Work shall be included in the "Shared Company Costs" under the Construction Agreement and any payment of such amounts under this Agreement shall be credited to the Government Entity in calculating the "Net Amount" payable under the Construction Agreement. 15. Within sixty (60) business days after completion of the Design Work, the Company shall issue to the Government Entity an itemized invoice for the amounts payable under this Agreement. Such invoice shall be in a form mutually agreed upon by the Company and the Government Entity and shall, at a minimum, itemize the design and engineering costs, including and listing separately inspection, labor, materials and equipment. In the event the Govemment Entity does not verify such invoice within ten (10) business days of receipt, the Government Entity shall provide a written request to the Company specifying the additional information needed to verify the invoice. The Company will provide, within a reasonable period after receipt of any request, such documentation and information as the Government Entity may reasonably request to verify such invoice. The Government Entity shall pay the Company all amounts payable under this Agreement within thirty (30) days after receipt of the Company's invoice. Payment as provided in this Agreement shall be full compensation for the Company's performance of the Design Work, including without limitation all services rendered and all materials, supplies, equipment, and incidentals necessary to complete the Design Work. 16. Dispute Resolution Procedures: (a) Any dispute, disagreement or claim arising out of or concerning this Agreement must first be presented to and considered by the parties. A party who wishes dispute resolution shall notify the other party in writing as to the nature of the dispute. Each party shall appoint a representative who shall be responsible for representing the party's interests. The representatives shall exercise good faith efforts to resolve the dispute. Any dispute that is not resolved within ten (10) business days of the date the disagreement was first raised by written notice shall be referred by the parties' representatives in writing to the senior management of the parties for resolution. In the event the senior management are unable to resolve the dispute within twenty (20) business days (or such other period as the parties may agree upon), each party may pursue resolution of the dispute through other legal means consistent with the terms of this Agreement. All negotiations pursuant to these procedures for the resolution of disputes shall be confidential and shall be treated as compromise and settlement negotiations for purposes of the state and federal rules of evidence. (b) Any claim or dispute arising hereunder which relates to the Scope of Work, Design Cost Estimate, and Design Schedule under paragraph 4, above; the Project Plan under paragraph 10, above; or any Request for Change (including, without limitation, any associated equitable adjustment) under paragraph 13, above; and is not resolved by senior management within the time permitted under paragraph 16(a), above, shall be resolved by arbitration in Seattle, Washington, under the Construction Industry Arbitration Rules of the American Arbitration Association then in effect. The decision(s) of the arbitrator(s) shall be final, conclusive and binding upon the Parties. All other disputes shall be resolved by litigation in any court or governmental agency, as applicable, having jurisdiction over the Parties and the dispute. (c) In connection with any arbitration under this paragraph 16, costs of the arbitrator(s), hearing rooms and other common costs shall be divided equally among the parties. Each party shall bear the cost and expense of preparing and presenting its own case (including, but not limited to, its own attorneys' fees); provided, that, in any arbitration, the arbitrator(s) may require, as part of Schedule 74 Design Agreement City of Federal Way: Hwy.99 Ph.2 Conversion #101010669 WN U-60 Issued: June 26, 2002 Effective: July 1, 2002 Attachment "A" to Schedule 74, Page 7 PUGET SOUND ENERGY his or her decision, reimbursement of all or a portion of the prevailing party's costs and expenses by the other party. (d) Unless otherwise agreed by the parties in writing, the parties shall continue to perform their respective obligations under this Agreement during the pendency of any dispute. 17. In the event that either party is prevented or delayed in the performance of any of its obligations under this Agreement by reason beyond its reasonable control (a "Force Majeure Event"), then that party's performance shall be excused during the Force Majeure Event. Force Majeure Events shall include, without limitation, war; civil disturbance; flood, earthquake or other Act of God; storm, earthquake or other condition which necessitates the mobilization of the personnel of a party or its contractors to restore utility service to customers; laws, regulations, rules or orders of any governmental agency; sabotage; strikes or similar labor disputes involving personnel of a party, its contractors or a third party; or any failure or delay in the performance by the other party, or a third party who is not an employee, agent or contractor of the party claiming a Force Majeure Event, in connection with the Work or this Agreement. Upon removal or termination of the Force Majeure Event, the party claiming a Force Majeure Event shall promptly perform the affected obligations in an orderly and expedited manner under this Agreement or procure a substitute for such obligation. The parties shall use all commercially reasonable efforts to eliminate or minimize any delay caused by a Force Majeure Event. 18. This Agreement is subject to the General Rules and Provisions set forth in Tariff Schedule 80 of the Company's electric Tariff G and to Schedule 74 of such Tariff as approved by the Washington Utilities and Transportation Commission and in effect as of the date of this Agreement. 19. Any notice under this Agreement shall be in writing and shall be faxed (with a copy followed by mail or hand delivery), delivered in person, or mailed, properly addressed and stamped with the required postage, to the intended recipient as follows: If to the Government Entitv: City of F~dpr~l W~y PO RoX' q71 R pp~pr~l W~y WA QROh<-9718 Attn: '1 Rmrpr P P Fax: (253) 661-4129 If to the Comoanv: Puget Sound Energy, Inc. 6905 South 228th Street, SKC-OFC Kent, WA 98032 Attn: Mary Ausbum, AICP Municipal Liaison Manager Fax: (253) 395-6835 Either party may change its address specified in this paragraph by giving the other party notice of such change in accordance with this paragraph. 20. This Agreement shall in all respects be interpreted, construed and enforced in accordance with the laws of the State of Washington (without reference to rules governing conflict of laws), except to the extent such laws may be preempted by the laws of the United States of America. Schedule 74 Design Agreement City of Federal Way: Hwy.99 Ph.2 Conversion #101010669 WN U-60 Issued: June 26, 2002 Effective: July 1, 2002 Attachment "A" to Schedule 74, Page 8 PUGET SOUND ENERGY 21. This Agreement constitutes the entire agreement of the parties with respect to the subject matter hereof and all other agreements and understandings of the Parties, whether written or oral, with respect to the subject matter of this Agreement are hereby superseded in their entireties. 22. This Agreement shall be binding upon and inure to the benefit of the respective successors, assigns, purchasers, and transferees of the parties, including but not limited to, any entity to which the rights or obligations of a party are assigned, delegated, or transferred in any corporate reorganization, change of organization, or purchase or transfer of assets by or to another corporation, partnership, association, or other business organization or division thereof. Schedule 74 Design Agreement City of Federal Way: Hwy.99 Ph.2 Conversion #101010669 WN U-60 Issued: June 26, 2002 Effective: July 1, 2002 Attachment "An to Schedule 74, Page 9 PUGET SOUND ENERGY 23. In connection with the Conversion Project, the parties have previously entered into an Engineering Design Agreement dated as of March 12 2002 (the "Preliminary Agreement"), pursuant to which PSE has undertaken some or all of the Design Work contemplated by this Agreement. Accordingly, notwithstanding anything in this Agreement to the contrary, the following will hereafter apply: (a) The Preliminary Agreement is hereby superseded in its entirety by the terms of this Agreement; (b) The Government Entity's initial Scope of Work, as contemplated by paragraph 2, above, has been provided by the Govemment Entity to the Company and is attached hereto as Exhibit B, and all applicable provisions of this Agreement are hereby amended accordingly; (c) The parties acknowledge and agree that (i) the Design Cost Estimate, as contemplated by this Agreement, shall reflect the actual costs incurred by the Company to perform that portion of the Design Work undertaken pursuant to the Preliminary Agreement and shall set forth a good faith estimate of the costs to perform the remainder of the Design Work under this Agreement, and (Ii) the Company's initial Design Cost Estimate, as contemplated by paragraph 3, above, shall be submitted by the Company to the Government Entity within ten (10) business days of the date of this Agreement, and all applicable provisions of this Agreement are hereby amended accordingly; (d) The parties acknowledge and agree that (i) the Design Schedule, as contemplated by this Agreement, shall reflect the completion of that portion of the Design Work undertaken pursuant to the Preliminary Agreement and shall set forth a schedule for completing the remainder of the Design Work under this Agreement, and (Ii) the Company's initial Design Schedule, as contemplated by paragraph 3, above, will be submitted by the Company to the Government Entity within ten (10) business days of the date of this Agreement, and all applicable provisions of this Agreement are hereby amended accordingly; and (e) Except as necessary to implement subparagraphs (a) through (d), above, the terms of this Agreement will be binding on the parties and remain in full force and effect without amendment or change. Government Entity: Company: PUGET SOUND ENERGY, INC. :~~~;::; Date Signed Date Signed \0. \ (:). 0 oS. Schedule 74 Design Agreement City of Federal Way: Hwy.99 Ph.2 Conversion #101010669 e:)(~ Ik, II A WN U-60 Issued: June 26, 2002 Effective: July 1, 2002 Attachment "B" to Schedule 74, Page 1 PUGET SOUND ENERGY Attachment "B" - Project Construction Agreement SCHEDULE 74 UNDERGROUND CONVERSION AGREEMENT THIS Agreemenl, dated as of this - day of , 2002, is made by and between the CITY OF FEDERAL WAY, a Municipal Corporation (lhe "Government Entily"), and PUGET SOUND ENERGY, Inc., a Washington Corporation (the "Company"). RECITALS A. The Company is a public service company engaged in the sale and dislribulion of electric energy, and pursuant to its franchise or olher rig hIs from lhe Government Enlity, currently locales ils electric distribution facilities within the jurisdictional boundaries of the Government Entily. B. The Government Entity has determined that it is necessary to replace the exisling overhead eleclric distribution system within the area specified in the Projecl Plan (as defined below) (the "Conversion Area") wilh a comparable underground electric distribution system, all as more specifically described in lhe Project Plan (the "Conversion Project"). C. The Government Entity and the Company have previously entered into a Project Design Agreement dated as of (the "Design Agreement"), pursuant 10 which lhe parties completed certain engineering design, cost assessment, operating righls planning and olher preliminary work relating 10 lhe Conversion Projecl and, in connection with that effort, developed the Project Plan. D. The Government Enlity and the Company wish to execute this written contracl in accordance with Schedule 74 of the Company's Electric Tariff G ("Schedule 74") to govern the completion of lhe Conversion Project, which bolh parties inlend shall qualify as an underground conversion under lhe terms of Schedule 74. AGREEMENT The Government Entity and the Company therefore agree as follows: 1. Definitions. (a) Unless specifically defined olherwise herein, all terms defined in Schedule 74 shall have the same meanings when used in lhis Agreement, including, without limitation, the following: i) ii) iii) iv) v) vi) Cost of Conversion; Public Thoroughfare; Temporary Service; Trenching and Restoration; Underground Distribution Syslem; and Underground Service Lines. (b) "Company-Initiated Upgrade" shall mean any fealure of the Underground Distribution System which is required by the Company and is not reasonably required to make the Underground Distribution System comparable to the overhead distribution system being replaced. For purposes of lhe foregoing, a "comparable" syslem shall include, unless the Parties olherwise WN U-60 Issued: June 26, 2002 Effective: July 1, 2002 Attachment "B" to Schedule 74, Page 2 PUGET SOUND. ENERGY agree, the number of empty ducts (not to exceed two (2), typically having a diameter of 6" or less) of such diameter and number as may be specified and agreed upon in the Project Plan necessary 10 replicate the load-carrying capacity (system amperage class) of the overhead system being replaced. (c) "Estimated Reimbursable Private Conversion Costs" shall mean the Company's good failh estimate of the Reimbursable Private Conversion Costs, as specified in the Projecl Plan and as changed and adjusted from lime 10 time in accordance with Section 6, below. (d) "Eslimated Reimbursable Temporary Service Costs" shall mean the Company's good faith estimate of the Reimbursable Temporary Service Costs, as specified in the Project Plan and as changed and adjusted from lime 10 time in accordance with Section 6, below. (e) "Estimated Reimbursable Upgrade Costs" shall mean the Company's good faith estimale of the Reimbursable Upgrade Cosls, as specified in the Project Plan and as changed and adjusted from time to lime in accordance with Section 6, below. (f) "Estimated Shared Company Costs" shall mean the Company's good faith estimale of the Shared Company Cosls, as specified in the Project Plan and as changed and adjusted from time to lime in accordance with Section 6, below. (g) "Estimated Shared Government Costs" shall mean the Government Entily's good faith estimate of the Shared Government Costs, as specified in the Project Plan and as changed and adjusted from time to time in accordance with Section 6, below. (h) "Government-Requested Upgrade" shall mean any fealure of the Underground Dislribution Syslem which is requested by the Government Entity and is not reasonably required to make the Underground Distribution System comparable 10 the overhead distribution system being replaced. For purposes of the foregoing, any empty ducts inslalled at lhe requesl of the Government Entity shall be a Government-Requested Upgrade. (i) "Party" shall mean eilher the Company, the Government Entity, or both. ü) "Private Property Conversion" shall mean lhal portion, if any, of the Conversion Project for which the existing overhead electric distribution syslem is located, as of the date determined in accordance with Schedule 74, (i) outside of lhe Public Thoroughfare, or (ii) pursuant to rights not derived from a franchise previously granted by the Government Entity or pursuant to rights not otherwise previously granted by the Government Entily. (k) "Project Plan" shall mean the project pian developed by the Parties under the Design Agreement and attached hereto as Exhibit A, as the same may be changed and amended from time to tirne in accordance with Seclion 6, below. The Project Plan includes, among other things, (i) a detailed descriplion of lhe Work that is required to be performed by each Party and any third party, (ii) lhe applicable requirements and specifications for the Work, (Iii) a descriplion of the Operating Rights thaI are required to be obtained by each Party for the Conversion Project (and the requirements and specificalions with respect lherelo), (iv) an itemization and summary of the Estimaled Shared Company Costs, Eslimated Shared Governmenl Costs, Estimated Reimbursable Private Conversion Costs (if any), Estimated Reimbursable Temporary Service Costs (if any) and Estimated Reimbursable Upgrade Cosls (if any), and (v) the Work Schedule. WN U-60 Issued: June 26, 2002 Effeclive: July 1, 2002 Attachmenl "B" to Schedule 74, Page 3 PUGET SOUND ENERGY (I) ~Operating Righls" shall mean sufficient space and legal rights for the construction, operation, repair, and maintenance of the Underground Dislribution System. (m) "Reimbursable Private Conversion Cosls" shall mean (i) all Costs of Conversion, if any, incurred by lhe Company which are attribulable to a Private Property Conversion, less (ii) the distribution pole replacement costs (if any) that would be ayoided by the Company on account of such Private Property Conversion, as determined consistent with the applicable Company distribution facilities replacement program, plus (iii) just compensalion as provided by law for the Company's interests in real property on which such exisling overhead distribution system was located prior to conversion; provided thaI the porlion of the Reimbursable Private Conversion Costs attributable to the Cosls of Conversion under subparagraph (i) of lhis paragraph shall not exceed the Estimated Reimbursable Private Conversion Costs without lhe prior written authorization of the Government Entity. (n) "Reimbursable Temporary Service Costs" shall mean all costs incurred by the Company which are attributable to (i) any facilities installed as part of the Conversion Project to provide Temporary Service, as provided for in Schedule 74, and (ii) lhe removal of any facilities installed to provide Temporary Service (less salvage value of removed equipment); provided that the Reimbursable Temporary Service Costs shall not exceed the Estimated Reimbursable Temporary Service Costs without lhe prior written authorizalion of the Government Entity. (0) "Reimbursable Upgrade Cosls" shall mean all Costs of Conversion incurred by the Company which are attributable to any Government-Requested Upgrade; provided that the Reimbursable Upgrade Cosls shall not exceed the Eslimated Reimbursable Upgrade Costs withoul the prior written aulhorizalion of the Government Entity. (p) "Shared Company Costs" shall mean all Costs of Conversion (other than Reimbursable Upgrade Costs, Reimbursable Private Conversion Costs and Reimbursable Temporary Service Costs) incurred by the Company in connection with the Conversion Project; provided, however, that the Shared Company Costs shall not exceed the Eslimated Shared Company Costs withoul the prior written authorizalion of the Government Entity. For the avoidance of doubl, lhe "Shared Company Costs" shall, as and to the extent specified in the Design Agreement, include the actual, reasonable costs 10 lhe Company for the "Design Work" performed by the Company under lhe Design Agreement. (q) "Shared Government Costs" shall mean all Costs of Conversion incurred by the Government Enlity in connection with (i) any duct and vaull installation Work which the Parties have specified in the Project Plan is 10 be performed by the Government Entily as part of lhe Government Work, and (ii) the acquisilion of any Operating Rights which lhe Parties have, by mutual agreement, specified in the Projecl Plan are to be obtained by lhe Governmenl Entity for the Conversion Project, but only to the extent attributable to that portion of such Operating Rights which is necessary to accommodale the facilities of the Company; provided, however, that the Shared Governmenl Costs shall not exceed the Estimated Shared Government Cosls withoul the prior written aulhorization of lhe Company. (r) "Total Shared Costs" shall mean lhe sum of the Shared Company Costs and lhe Shared Government Costs. For the avoidance of doubl, the Total Shared Costs shall not include, without limitation, (i) costs to the Government Entity for Trenching and Resloration, or (ii) costs associated with any joint use of trenches by olher ulilities as permitted under Seclion 3(b). WN U-60 Issued: June 26, 2002 Effective: July 1, 2002 Attachment "B" to Schedule 74, Page 4 PUGET SOUND ENERGY (s) "Work" shall mean all work to be performed in connection with the Conversion Project, as more specifically described in the Projecl Plan, including, withoullimitation, the Company Work (as defined in Section 2(a), below) and the Government Work (as defined in Seclion 3(a), below). (I) "Work Schedule" shall mean lhe schedule specified in the Project Plan which sets forth the mileslones for completing the Work, as the same may be changed and amended from time to lime in accordance with Section 6, below. 2. Obliqations of the Company. (a) Subject to the terms and conditions of this Agreement, the Company shall do the following as specified in, and in accordance with the design and conslruclion specifications and other requiremenls set forth in, the Project Plan (the "Company Work"): i) furnish and inslall an Underground Distribution System within the Conversion Area (excluding any duct and vault inslallation or other Work which the Parties have specified in the Project Plan is to be performed by the Government Entity); Ii) provide a Company inspector on-site at the limes specified in lhe Work Schedule to inspect the performance of any duct and vault installation Work which the Parties have specified in the Project Plan is to be performed by the Government Entity; and iii) upon connection of those persons or entities to be served by the Underground Oislribution Syslem and removal of facilities of any other utililies that are connected to lhe poles of the overhead system, remove the existing overhead system (including associated wires and Company-owned poles) of 15,000 volts or less within the Conversion Area except for Temporary Services. (b) Upon request of lhe Government Entity, the Company shall provide periodic reports of the progress of the Company Work idenlifying (i) lhe Company Work completed to date, (Ii) lhe Company Work yel to be completed, and (iii) an estimate regarding whelher lhe Conversion Project is on target with respect to the Estimated Shared Company Cosls, the Estimaled Reimbursable Privale Conversion Costs (if any), the Estimaled Reimbursable Temporary Service Costs (if any), the Estimated Reimbursable Upgrade Costs (if any) and the Work Schedule. (c) Except as olherwise provided in the Company's Electric Tariff G, the Company shall own, operate and maintain all electrical facililies installed pursuanl to lhis Agreement including, but not limited to, the Underground Distribution System and Underground Service Lines. (d) Subject to the lerms and conditions of this Agreement, the Company shall perform all Company Work in accordance with the Project Plan, the Work Schedule and lhis Agreement. 3. Obliqations of the Government Entitv. (a) Subjecl to lhe lerms and conditions of this Agreement, the Governmenl Entity shall do the following as specified in, and in accordance with the design and conslruction specifications and olher requirements set forth in, the Project Plan (the "Government Work"): i) provide lhe Trenching and Restoration; ii) perform the surveying for alignment and grades for ducls and vaults; and iii) perform any duct and vault inslallation and other Work which the Parties have specified in the Project Plan is to be performed by the Government Entity. WN U-60 Issued: June 26, 2002 Effeclive: July 1, 2002 Attachment "B" to Schedule 74, Page 5 PUGET SOUND ENERGY (b) Other utilities may be permitted by the Government Entity 10 use the trenches provided by the Governmenl Entily for the installation of their facililies so long as such facilities or the installation thereof do not interfere (as determined pursuant 10 the Company's electrical standards) with lhe Underground Dislribution Syslem or lhe installation or mainlenance thereof. Any such use of the trenches by other utilities shall be done subject to and in accordance with the joint lrench design specifications and installation drawings set forth or olherwise identified in the Projecl Pian, and the Government Entity shall be responsible for the coordination of the design and inslallalion of the facilities of the other utilities 10 ensure compliance wilh such specifications and drawings. (c) Upon request of the Company, the Governmenl Enlity shall provide periodic reports of the progress of the Government Work identifying (i) the Government Work completed 10 date, (ii) the Government Work yel to be completed, and (iii) an eslimate regarding whether the Conversion Projecl is on target wilh respect to the Estimated Shared Government Costs and the Work Schedule. (d) The Governmenl Entity shall be responsible for coordinaling all work to be performed in connection with the street improvement program within the Conversion Area. (e) Subject 10 the terms and conditions of this Agreement, lhe Government Entity shall perform all Government Work in accordance with the Project Plan, the Work Schedule and this Agreement. 4. Work Schedule. (a) The Government Entily and lhe Company have agreed upon the Work Schedule as set forth in the Projecl Plan. Changes 10 the Work Schedule shall be made only in accordance with Seclion 6, below. (b) Promptly following the execution of lhis Agreement, and upon completion by the Government Entity of any necessary preliminary work, the Government Entily shall hold a pre-construction meeting involving all participants in the Conversion Project to review project design, coordination requirements, work sequencing and related pre-mobilization requirements. Following the pre- construclion meeting, the Government Entity shall give lhe Company written nolice to proceed wilh lhe Work at least ten (10) business days prior to the commencement date specified in the Work Schedule. (c) Subject to lhe lerms and condilions of this Agreemenl, each Party shall perform the Work assigned to it under this Agreement in accordance with the Work Schedule. So long as the Company performs lhe Company Work in accordance wilh lhe Work Schedule, lhe Company shall nol be liable to the Government Entity (or its agents, servants, employees, contractors, subcontractors, or representatives) for any claims, actions, damages, or liability asserted or arising out of delays in the Work Schedule. 5. Location of Facilities. All facilities of the Company inslalled within the Conversion Area pursuant to this Agreement shall be located, and all relaled Operating Righls shall be oblained, in the manner set forth in the applicable provisions of Scheduie 74, as specified by the Parties in the Project Plan. WN U-60 Issued: June 26, 2002 Effective: July 1, 2002 Attachment "B" to Schedule 74, Page 6 PUGET SOUND ENERGY 6. Chanqes. (a) Eilher Party may, at any lime, by written notice thereof to the olher Party, request changes in lhe Work within the general scope of this Agreement (a "Request for Change"), including, but not limited to: (i) changes in, substitutions for, additions to or deletions of any Work; (ii) changes in the specifications, drawings and other requirements in the Projecl Plan, (iii) changes in lhe Work Schedule, and (iv) changes in lhe localion, alignment, dimensions or design of ilems included in the Work. No Requesl for Change shall be effective and binding upon the Parties unless signed by an authorized representative of each Party. (b) If any change included in an approved Requesl for Change would cause a change in the cost of, or lhe time required for, the performance of any part of the Work, an equitable adjustment shall be made in the Eslimated Shared Company Costs, the Estimated Shared Government Costs, the Estimated Reimbursable Privale Conversion Costs (if any), the Estimated Reimbursable Temporary Service Costs (if any), the Estimated Reimbursable Upgrade Costs (if any) and/or the Work Schedule to reflect such change. The Parties shall negotiate in good faith with lhe objeclive of agreeing in writing on a mutually acceptable equitable adjuslment. If the Parties are unable to agree upon the terms of the equitable adjustment, either Party may submit the matter for resolution pursuant to the dispute resolution provisions in Section 10, below. (c) The Work Schedule, the Eslimated Shared Company Costs, the Estimated Shared Government Costs, the Estimaled Reimbursable Private Conversion Costs, the Estimated Reimbursable Temporary Service Costs and/or the Estimaled Reimbursable Upgrade Costs shall be further equitabiy adjusted from lime to time to reflect any change in the cosls or time required 10 perform the Work to lhe extent such change is caused by: (i) any Force Majeure Event under Section 11, below, (ii) the discovery of any condilion within the Conversion Area which affects the scope, cost, schedule or other aspect of lhe Work and was nol known by or disclosed to the affected Party prior to the date of this Agreement, or (iii) any change or inaccuracy in any assumptions regarding the scope, cost, schedule or other aspect of the Work which are expressly identified by the Parties in the Project Plan. Upon the request of eilher Party, the Parties will negotiale in good faith with the objective of agreeing in writing on a mutually acceplable equilable adjuslment. If, at any time thereafter, the Parties are unable to agree upon the terms of the equilable adjustment, either Party may submit the matter for resolution pursuant to the dispule resolulion provisions in Section 10, below. (d) Notwithstanding any dispute or delay in reaching agreement or arriving at a mulually acceptable equitable adjuslment, each Party shall, if requested by the other Party, proceed with lhe Work in accordance with any approved Request for Change. Any requesl to proceed hereunder must be accompanied by a written statement setting forth the requesting Party's reasons for rejecling the proposed equitable adjustmenl of the olher Party. 7. Compensation and Payment. (a) Subject 10 and in accordance wilh the terms and condilions of this Agreement (including, wilhoul limitalion, the paymenl procedures set forth in this Section 7), paymenl in connection with the Conversion Project and lhis Agreement shall be as follows: i) The Total Shared Costs shall be allocated to the Parties in lhe following percentages: (A) sixty percent (60%) to the Company, and (B) forty percent (40%) to the Government Entily. WN U-60 Issued: June 26, 2002 Effective: July 1, 2002 Attachment "B" to Schedule 74, Page 7 PUGET SOUND ENERGY ii) The Government Entily shall pay one hundred percenl (100%) of all Reimbursable Privale Conversion Costs, if any. iii) The Government Entity shall pay one hundred percenl (100%) of all Reimbursable Upgrade Costs, if any. iv) The Government Entity shall pay one hundred percent (100%) of all Reimbursable Temporary Service Costs, if any. v) The Government Enlity shall pay one hundred percenl (100%) of the costs it incurs 10 perform that portion of the Government Work specified in Section 3(a)(i) and (Ii) (i.e., Trenching and Restoration and surveying). vi) The Company shall pay one hundred percenl (100%) of the costs it incurs to design, provide and construct any Company-Initialed Upgrade. vii) The Cornpany shall pay one hundred percent (100%) of the cosls it incurs to obtain Operating Rights outside lhe Public Thoroughfare. (b) Based on the allocation of responsibilities set forth in Section 7(a), above, the Parties shall determine the net amount payable by the Government Entily or the Company, as applicable, 10 lhe other Party under this Agreement (lhe "Net Amount"). The Net Amount shall be delermined by using the amount of the Total Shared Costs allocated to the Government Enlity under Section 7(a)(i), and adjusting such amount as follows: i) Subtracling (as a credit to the Government Entily) the amount of the Shared Governmenl Costs. Ii) Adding (as a credit to the Company) the amount of all Reimbursable Private Conversion Cosls, Reimbursable Upgrade Cosls and Reirnbursable Temporary Service Costs. iii) Subtracting (as a credil to lhe Government Entity) any payments previously made to lhe Company by the Government Entily under the Design Agreemenl which, under the lerms of the Design Agreement, are to be credited to the Government Entily under this Agreement The Net Amount, as so calculated, (A) will be an amount payable 10 the Company if it is a positive number, and (B) shall be an amount payable to the Government Entity if it is a negative number. (c) Within sixty (60) business days of complelion of the Conversion Projecl, the Government Entity shall provide the Company with an itemization of lhe Shared Government Costs (the "Government Itemization"), togelher with such documentation and information as lhe Company may reasonably request 10 verify lhe Governmenlltemization. The Governmenlltemization shall, at a minimum, break down the Shared Government Costs by the following calegories, as applicable: (i) property and related costs incurred and/or paid by the Government Entity, including any costs of oblaining Operating Rights, and (ii) construction costs incurred and/or paid by the Governrnent Entity, including and listing separately inspeclion, labor, materials and equipment, overhead and all costs charged by any agenl, contractor or subcontractor of the Government Entity. (d) Within lhirty (30) business days after the Company's receipt of the Government Itemization and requested documenlalion and information, the Company shall provide the Government Entity a written statement (the "Company Statement") showing (i) an iternization of the Shared Company Costs, (ii) the Parties' relative share of the Total Shared Costs based on the Company's itemization of the Shared Company Costs and the Government Entity's itemizalion of lhe Shared Government Costs set forth in lhe Government Itemization, (iii) any Reimbursable Private Conversion Cosls, (iv) any Reimbursable Upgrade Cosls, (v) any Reimbursable Temporary Service Costs, (vi) any credits 10 the Government Entity for paymenls previously made to the Company by the Government Entily under the Design Agreement which, under the terms of the WN U-60 Issued: June 26, 2002 Effeclive: July 1, 2002 Attachment "6" to Schedule 74, Page 8 PUGET SOUND ENERGY Design Agreement, are to be credited to the Government Entily under this Agreement, and (vii) the Net Amount, as determined in accordance with Section 7(b), above, together with such documentation and information as the Government Entity may reasonably request to verify the Company Slatement. The itemization of the Shared Company Cosls included in the Company Statement shall, al a minimum, break down lhe Shared Company Cosls by the following categories, as applicable: (i) design and engineering cosls, and (ii) construction costs, including and listing separately inspection, labor, materials and equipmenl, overhead and all costs charged by any agent, contractor or subcontractor of the Company. (e) Within thirty (30) business days after the Governmenl Entity's receipt of the Company Statemenl and requested documentation and information, lhe Net Amounl shall be paid by the owing Party to the olher Party, as specified in the Company Statement. 8. Indemnification. (a) The Government Entity releases and shall defend, indemnify and hold the Company harmless from all claims, losses, harm, liabilities, damages, costs and expenses (including, but not limiled -. to, reasonable attorneys' fees) caused by or arising out of any negligent act or omission or willful misconduct of the Government Entily in ils performance under this Agreement. During the performance of such activilies the Governmenl Entity's employees or contractors shall at all times remain employees or contractors, respectively, of the Governmenl Entity. (b) The Company releases and shall defend, indemnify and hold the Government Entity harmless from all claims, losses, harm, liabililies, damages, costs and expenses (including, but not limited to, reasonable attorneys' fees) caused by or arising out of any negligent act or omission or willful misconduct of the Company in ils performance under this Agreement. During the performance of such activities the Company's employees or contraclors shall at all times remain employees or contractors, respectively, of the Company. (c) Solely for purposes of enforcing the indemnification obligalions of a Party under this Section 8, each Party expressly waives its immunity under Title 51 of the Revised Code of Washington, the Industrial Insurance Act, and agrees that the obligalion to indemnify, defend and hold harmless provided for in lhis Section 8 exlends 10 any such claim brought againsl the indemnified Party by or on behalf of any employee of the indemnifying Party. The foregoing waiver shall nol in any way preclude the indemnifying Party from raising such immunity as a defense against any claim brought againsl the indemnifying Party by any of ils empioyees. 9. Conversion of Service to Cuslomers wilhin Conversion Area. (a) Upon commencemenl of the Work, the Government Enlily shall notify all persons and enlities wilhin lhe Conversion Area lhat service lines to such customers must be converted from overhead to underground service within the applicable statutory period following written notice from the Governmenl Entity that service from underground facilities are available in accordance with RCW 35.96.050. Upon the request of any cuslomer, other than a single family residenlial customer, within the Conversion Area, the Company shall remove the overhead system and connect such persons' and entities' Underground Service Lines to the Underground Distribution System. (b) The Parties acknowledge lhat single family residences within the Conversion Area must (i) provide a service trench and conduil, in accordance wilh the Company's specifications, from the underground meter base to the point of service provided during the conversion, and (ii) pay for the secondary service conduclors as defined in Schedule 85 of the Company's Electric Tariff G. The Government Entily shall exercise its authority to order disconneclion and removal of overhead WN U-60 Issued: June 26, 2002 Effective: July 1, 2002 Attachment "B" to Schedule 74, Page 9 PUGET SOUND ENERGY facililies with respecl to owners failing to convert service lines from overhead to underground within lhe timelines provided in RCW 35.96.050. 10. Dispule Resolution. (a) Any dispule, disagreement or claim arising out of or concerning this Agreement must first be presented 10 and considered by the Parties. A Party who wishes dispute resolution shall notify the other Party in writing as to the nature of the dispute. Each Party shall appoint a representalive who shall be responsible for represenling the Party's interests. The representatives shall exercise good faith efforts to resolve the dispute. Any dispute that is not resolved wilhin ten (10) business days of the date the disagreement was first raised by written notice shall be referred by the Parties' representatives in writing to the senior managemenl of the Parties for resolution. In the event the senior management are unable to resolve the dispute within twenty (20) business days (or such olher period as the Parties may agree upon), each Party may pursue resolulion of the dispute lhrough other legal means consistent with the terms of this Agreement. All negoliations pursuant to these procedures for the resolution of dispules shall be confidential and shall be treated as compromise and settlement negoliations for purposes of lhe stale and federal rules of evidence. (b) Any claim or dispute arising hereunder which relates 10 any Requesl for Change or any equitable adjustment under Section 6, above, or the compensation payable by or 10 either Party under Section 7, above, and which is not resolved by senior management within the time permitted under Section 10(a), above, shall be resolved by arbilration in Seattle, Washington, under the Conslruction Industry Arbilration Rules of the American Arbitration Associalion then in effect. The decision(s) of the arbitrator(s) shall be final, conclusive and binding upon the Parties. All other dispules shall be resolved by liligalion in any court or governmenlal agency, as applicable, having jurisdiction over lhe Parties and the dispule. (c) In connection with any arbitralion under lhis Section 10, costs of the arbitrator(s), hearing rooms and other common costs shall be divided equally among lhe Parties. Each Party shall bear the cost and expense of preparing and presenling its own case (including, but not limited to, its own attorneys' fees); provided, thaI, in any arbitration, the arbitrator(s) may require, as part of his or her decision, reimbursement of all or a portion of the prevailing Party's cosls and expenses (including, but not limited to, reasonable attorneys' fees) by the other Party. (d) Unless otherwise agreed by the Parties in wriling, the Parties shall continue to perform their respective obligalions under this Agreement during lhe pendency of any dispute. 11. Uncontrollable Forces. In lhe event that eilher Party is prevented or delayed in lhe performance of any of its obligations under lhis Agreemenl by reason beyond its reasonable control (a "Force Majeure Event"), then that Party's performance shall be excused during the Force Majeure Event. Force Majeure Evenls shall include, wilhoullimitation, war; civil disturbance; flood, earthquake or other Act of God; storm, earthquake or other condition which necessitates the mobilization of lhe personnel of a Party or its contraclors to reslore utilily service to customers; laws, regulations, rules or orders of any governmental agency; sabotage; strikes or similar labor disputes involving personnel of a Party, its contractors or a third party; or any failure or delay in the performance by the other Party, or a third party who is not an employee, agent or contractor of lhe Party claiming a Force Majeure Event, in connection wilh the Work or this Agreement. Upon removal or termination of the Force Majeure Event, the Party claiming a Force Majeure Event shall promplly perform the affected obligations in an orderly and expedited WN U-60 Issued: June 26, 2002 Effective: July 1, 2002 Attachment "B" to Schedule 74, Page 10 PUGET SOUND ENERGY manner under this Agreement or procure a substitute for such obligation. The Parties shall use all commercially reasonable efforts to eliminate or minimize any delay caused by a Force Majeure Event. 12. Insurance. (a) PSE shall, and shall require each of its contractors to, secure and mainlain in force lhroughout the duration of the Conversion Project (or, if sooner, until termination of this Agreement) comprehensive general liability insurance, with a minimum coverage of $_per occurrence and $- aggregate for personal injury; and $_per occurrence/aggregate for property damages, and professional liability insurance in the amount of $_. (b) The Government Entity shall ensure that each of its contractors performing any Government Work secures and maintains in force throughout the duration of the Conversion Project (or, if sooner, until termination of this Agreement) insurance policies having the same coverage, amounts and limits as specified Section 12(a), above. (c) In lieu of the insurance requirements set forth in Section 12(a), above, the Company may self- insure against such risks in such amounts as are consistent with good utility practice. Upon the Government Entily's request, the Company shall provide the Government Enlity with reasonable written evidence that the Company is maintaining such self-insurance. 13. Other. (a) Aqreement Subiect To Tariff. This Agreement is subject to the General Rules and Provisions set forth in Tariff Schedule 80 of the Company's electrical Tariff G and 10 Schedule 74 of such Tariff as approved by the Washington Utilities and Transportation Commission and in effect as of the date of this Agreement. (b) Terminalion. The Government Entity reserves the right to terminate the Conversion Project and this Agreement upon written notice 10 the Company. In the event that the Government Entity terminates the Conversion Projecl and this Agreement, the Government Entity shall reimburse the Company for all costs reasonably incurred by lhe Company in connection with lhe Work performed prior to lhe effeclive date of termination. In such event, the costs reimbursabie to the Company (I) shall not be reduced by any Shared Government Costs or other costs incurred by the Government Entity, and (ii) shall be paid within lhirty (30) days after the receipt of the Company's invoice therefor. Sections 1, 5, 7, 8, 9, 10, 11 and 13 shall survive any termination of the Conversion Projecl and/or this Agreement. (c) Facilities Greater Than 15000 Volts. Nothing in this Agreement shall in any way affect the rights or obligations of the Company under any previous agreements pertaining to the existing or future facilities of greater than 15,000 Volts within the Conversion Area. (d) Compliance Wilh Law. The Parties shall, in performing the Work under this Agreement, comply with all applicable federal, state, and local laws, ordinances, and regulations. (e) No Discrimination. The Company, with regard to the Work performed by the Company under this Agreement, shall compiy with all applicable laws relating to discrimination on the basis race, color, national origin, religion, creed, age, sex, or the presence of any physical or sensory handicap in the selection and retention of employees or procurement of materials or supplies. (f) Independent Contractor. The Company and the Government Entity agree that the Company is an independent conlractor with respect to lhe Work and this Agreement. The Company is acling to WN U-60 Issued: June 26, 2002 Effective: July 1, 2002 Attachment "B" to Schedule 74, Page 11 PUGET SOUND ENERGY preserve and protect its facilities and is not acting for the Governmenl Entity in performing the Work. Nothing in this Agreemenl shall be considered to creale the relationship of employer and employee belween the Parties. Neilher the Company nor any employee of lhe Company shall be entitled to any benefits accorded employees of lhe Government Entily by virtue of the Work or this Agreement. The Governmenl Entily shall not be responsible for withholding or otherwise deducting federal income tax or social securily or contributing to lhe State Industrial Insurance Program, or otherwise assuming lhe duties of an employer with respect to the Company, or any employee of the Company. (g) Nonwaiver of Riqhts or Remedies. No failure or delay of eilher Party to insist upon or enforce strict performance by the other Party of any provision of this Agreemenl or to exercise any other right under this Agreemenl, and no course of dealing or performance wilh respect therelo, shall, excepl to the extent provided in this Agreement, be conslrued as a waiver or, or choice of, or relinquishment of any righl under any provision of this Agreement or any right allaw or equity not otherwise provided for herein. The express waiver by either Party of any right or remedy under this Agreement or allaw or equity in a particular inslance or circumstance shall nol constitute a waiver thereof in any other instance or circumstance. (h) No Third Partv Beneficiaries. There are no third-party beneficiaries of lhis Agreement. Nothing contained in this Agreement is intended to confer any righl or interest on anyone other than lhe Parties, their respeclive successors, assigns and legal representatives. (i) Governmental Aulhoritv. This Agreement is subject 10 the rules, regulalions, orders and other requirements, now or hereafter in effect, of all governmenlal regulatory aulhorities and courts having jurisdiction over lhis Agreement, the Parties or either of them. All laws, ordinances, rules, regulations, orders and other requirements, now or hereafter in effect, of governmental regulatory authorities and courts thaI are required to be incorporated inlo agreements of this character are by this reference incorporated in this Agreement. ü) No Partnership. This Agreement shall not be interpreted or construed to create an association, joinl venture or partnership between the Parties or to impose any partnership obligations or liabilily upon either Party. Further, neither Party shall have any right, power or authorily 10 enter inlo any agreement or undertaking for or on behalf of, to act as or be an agent or represenlative of, or to otherwise bind the other Party. (k) Severabilitv. In lhe evenllhat any provision of this Agreemenl or the application of any such provision shall be held invalid as 10 either Party or any circumstance by any court having jurisdiction, such provision shall remain in force and effect to the maximum extent provided by law, and all other provisions of this Agreement and their application shall not be affected thereby but shall remain in force and effect unless a court or arbilrator holds they are not severable from the invalid provisions. (I) Notice. Any notice under this Agreement shall be in writing and shall be faxed (with a copy followed by mail or hand delivery), delivered in person, or mailed, properly addressed and stamped with the required postage, to the intended recipient as follows: If to the Government Entitv: Altn: Fax: WN U-60 Issued: June 26, 2002 Effeclive: July 1, 2002 Allachmenl "B" to Schedule 74, Page 12 PUGET SOUND ENERGY If to the Company: Puget Sound Energy, Inc. 6905 South 228'h Street, SKCOFC Kenl, WA 98032 AlIn: Mary Ausburn Fax: (253) 395-6835 Any Party may change its address specified in this Section 13(1) by giving lhe other Party notice of such change in accordance wilh this Seclion 13(1). (m) Applicable Law. This Agreement shall in all respects be interpreted, construed and enforced in accordance wilh the laws of the Slate of Washington (wilhout reference to rules governing conflict of laws), except to the extent such laws may be preempled by the laws of the United Stales of America. (n) Entire Aqreement. This Agreement constitules the enlire agreement of the Parties wilh respect 10 the subject matter hereof and all other agreements and understandings of the Parties, whether written or oral, with respect to the subjecl matter of lhis Agreement are hereby superseded in their entireties; provided, however, that except as expressly set forth in this Agreement, nothing herein is intended 10 or shall alter, amend or supersede the Design Agreement and the same shall remain in full force and effecl in accordance with its terms. (0) Successors and Assiqns. This Agreement shall be binding upon and inure to the benefil of lhe respective successors, assigns, purchasers, and transferees of the Parties, including but not limiled to, any entily to which lhe rights or obligations of a Parly are assigned, delegaled, or lransferred in any corporate reorganization, change of organizalion, or purchase or lransfer of assets by or to another corporation, partnership, association, or other business organization or division thereof. Government Entity: Company: CITY OF FEDERAL WAY BY PUGET SOUND ENERGY, INC. BY ITS ITS Date Signed Date Signed Approved as to form: ~ £Xh,bìf B \ ~~«: /" ó' (253) 661-4000 Federal Way, WA 98063-9718 September 12, 2002 Mary Ausburn Municipal Land Planner Puget Sound Energy 3130 S 381h Street, TAC-ANX Tacoma, W A 98409 ' RE: AG 00-116; Pacific Highway S HOV Lanes Phase II (S 324th Street to S 340th Street) Utility Undergrounding Dear Ms, Ausburn: As per the letter dated June 7, 200 I to Anita Yurovchak, CH2M Hill is currently designing improvements to the second phase of Pacific Highway S for the City of Federal Way, The limits of this project extend from S 324th Street to the north to S 340th Street to the south, The proposed improvements include widening the roadway to include three lanes each direction, landscaped medians, roadway related storm drainage, undergrounding of overhead utilities and intersection channelization, Curb, gutter and sidewalk will also be incorporated on both sides ofthe roadway, The construction of these improvements is currently scheduled for Spring 2002, The City is requesting Puget Sound Energy to proceed with the design of undergrounding the existing overhead power lines and design of the relocation of the transmission lines. The design for the second phase will be similar to the design of the first phase of Pacific Highway S. CH2M Hill has sent plan sheets previously. Should you have any questions or need more information, please call me at (253) 66l-4lOL Sincerely, r~J ~ ,-£-tf Al Emter, P.E. Street Systems Project Engineer AE:jlf cc: ProjeCI File, AG 00-116 Day File k'~""~\p",j""~,"9 pi"" iilde>ig"'p" "~'Y ,","omdo,