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YA veston ASSOCIATES, INC.

December 10, 2019

Nashua Police Department
28 Office James Roche Drive
Nashua, NH 03062

Attn: Ms. Karen Smith - Business Manager

Re: Letter of Recommendation for Lavallee|Brensinger Architects
Nashua Police Department Floor Plan Renovation & Expansion project

Dear Karen,

Yeaton Associates has successfully partnered with Lavallee|Brensinger Architects on many projects
over the past 30+ years ranging from academic, municipal, healthcare, commercial and public
facilities. Lavallee has always been ahead of the curve on innovation and technology with regard to
architectural design, distinguishing themselves as one of the leading Architectural firms in New
England. The Lavallee|Brensinger team has always exemplified professionalism and put an
emphasis on client satisfaction.

Based on the longstanding and successful work history between Yeaton and Lavallee, we have no
reservation recommending them for the Nashua Police Department Floor Plan Renovation &
Expansion Project.

If you have any questions, please feel free to contact me.

Respectfully,

lil

Ryan Nealley, PE, CEM, M.S.M.E.
Mechanical Engineering Manager

40 So. River Rd #36, Bedford, NH 03110 | 646 Union St Suite 200, Littleton, NH 03561 | 603.444.6578 | www.yeatonassociates.com

m\ THE CITY OF NASHUA “the Cate Cty’

. ie

Administrative Services

Purchasing Department

December 12, 2019
Memo #20-065

TO: MAYOR DONCHESS
FINANCE COMMITTEE

SUBJECT: EXTENSION OF ESSEX POWER SERVICES INC JACKSON MILLS AND MINE FALLS
OPERATIONS AND MAINTENANCE AGREEMENT (VALUE $404,605 PLUS REVENUE SHARING)
DEPARTMENT: 170 HYDROELECTRIC OPERATIONS; FUND: GENERAL

Please see attached communication from Sarah Marchant, Community Development Division Director,
dated December 4, 2019 for information related to this contract award.

Pursuant to § 5-78 Major purchases (greater than $10,000) A. All supplies and contractual services,
except as otherwise provided herein, when the estimated cost thereof shall exceed $10,000 shall be
purchased by formal, written contract from the lowest responsible bidder, after due notice inviting bids.

The Community Development Department and the Purchasing Department recommend the award of this
contract to Essex Power Services of Boston, MA in an amount of $404,605 Plus Revenue Sharing.

Respectfujly

Dan“‘Kooken
Purchasing Manager

Cc: S. Marchant J. Graziano

« Community Development 589-3095
Cc ity of N ash lia Planning and Zoning 589-3090

. soe Building Safe’ 589-3080
Community Development Division Code Enforcement 589-3100
City Hall, 229 Main Street, PO Box 2019 Ce aerate amission B-a108
Nashua, New Hampshire 03061-2019 Transportation 880-0100
www.nashuanh.gov FAX 589-3119

Date: December 4, 2019
To: Jim Donchess, Mayor
From: Sarah Marchant, Community Development Director

Re: Finance Committee — Extension of Contract for Operation and Maintenance of Hydroelectric
Projects

The City of Nashua has owned Jackson Mills hydroelectric facility since December 2014 and Mine
Falls hydroelectric facility since the spring of 2017. In anticipation of purchasing Mine Falls, the
city went out to bid with RFP0266-033016 to find a contractor for the operation and maintenance of
both hydrofacilities. At that time there were 6 proposals received and the City ultimately entered
into contract with Essex Power Services Inc. based on an evaluation of technical qualifications,
experience and past performance, and cost.

The contract was crafted as a three year contract with an option for the City to extend for an
additional three. The City has had a positive experience with the Operations and Maintenance
services provided by Essex over the past three years and recommends rolling into the extension. We
are in the middle of relicensing Mine Falls Dam with the federal regulators and procuring a new
turbine at Jackson Mills. Essex has been a key team member in both of these large ongoing projects
and switching operators would be cost prohibitive.

The contract fee (as currently stipulated) includes 3 components: staff time, third party expenses
and an administrative fee. Staff time will be invoiced at a rate of $25 to $156 per hour depending on
position, with the majority of the work performed by assistant operators ($25/h) and operators
($52/h). Third party invoices will be billed at cost to cover parts, materials, and services not
provided by Essex. The administrative fee is 10% of gross revenue for the project for the first
20,000,000 kWh generated and 20% of gross revenues associated with generation above that.

With this cost structure, it is estimated that the City would incur $404,500 for staff time and
administrative fees and an additional $77,000 in third party costs, for a total of $404,605 in
operating costs for both facilities under this contract in FY20. Total anticipated revenues are
$1,212,000 for both facilities with a net profit of $807,395 for FY20.

The Waterways Department recommends Essex Power Services Inc. contract be extended as the
vendor to provide operation and maintenance service for the Jackson Mills and Mine Falls
hydroelectric facilities.

GENERATION PROJECT

OPERATION AND MAINTENANCE AGREEMENT

This OPERATION AND MAINTENANCE AGREEMENT ("Agreement") is
made and entered into as of _____ by and between City of Nashua, New Hampshire, a
municipal corporation ("OQwner" or “City”), and Essex Power Service, Inc. a Delaware
corporation, ("Operator"), each referred to as a “Party” and collectively as “Parties”.

RECITALS

WHEREAS, Owner owns Jackson Mills which is a 1 MW hydropower facility
and dam on the Nashua River in Nashua, New Hampshire, with a FERC license
exemption (Project number 7590),

WHEREAS, Owner has the right to purchase Mine Falls which is a 3 MW
hydropower facility and dam on the Nashua River in Nashua, New Hampshire, which is
licensed by FERC (Project number 3442),

WHEREAS, Owner desires to contract for operation, maintenance and
management of Jackson Mills and, immediately upon transfer to the City, of Mine Falls
(unless otherwise noted, “Project” shall refer to both),

WHEREAS, Operator provides operation, maintenance and management services
for hydroelectric generating facilities and associated equipment facilities and has agreed
to provide those services for the Project on the terms and conditions set forth in this
Agreement,

NOW THEREFORE, in consideration of the mutual covenants, undertakings and
conditions set forth below, the receipt and sufficiency of which are hereby acknowledged,
the parties hereby agree as follows:

ARTICLE 1
AGREEMENT

Section 1.1 - Agreement. This Agreement consists of the terms and conditions set
forth in the sections captioned by numbered article designations (“Articles”) and the
following appendices, which are incorporated and made part this Agreement by this
reference and are included in any reference to this Agreement.

Appendix A - Scope of Services

Appendix B — Reimbursable Costs and Compensation

Appendix C - Communication Protocols

Appendix D — Project Agreements

If the terms and conditions of the Articles of this Agreement vary or are inconsistent with
any portion of the Appendices, the terms of the Articles of this Agreement shall control
and be given priority, and the provisions of the Appendices shall be subject to the terms
of the Articles. This Agreement contains the entire agreement between the parties and
supersedes all prior agreements, whether oral or written, between the parties with respect
to the subject matter of this Agreement. Neither party will be bound by or be deemed to
have made any representations, warranties, commitments or other undertakings with
respect to the subject matter of this Agreement that are not contained in this Agreement.

Section 1.2 - Term. The term of this Agreement shall be for three (3) years from
January 1, 2017 through December 31, 2019, unless sooner terminated pursuant to the
terms of this Agreement. This Agreement may be renewed for two additional three (3)
year terms, with each 3-year term exercisable upon the City and Operator’s mutual
agreement. Operator shall give at least nine (9) months’ notice to Owner prior to the
then-term’s termination date if it does not wish to renew or of any changes in terms it
may request for renewal. Owner shall have six (6) months to respond and/or negotiate
with Operator regarding any such purposed changed terms.

Section 1.3 - Relationship of the Parties. Operator has been retained by Owner as
an independent contractor to operate, maintain and manage the Project on behalf of
Owner, in accordance with Prudent Utility Practice and the requirements of the
applicable Project Agreements and Laws. Owner has delegated to Operator overall
responsibility for operating, maintaining and managing the Project to ensure that the
Project is available to produce electric energy for sale by Owner and meets all
requirements under the applicable Project Agreements. Neither Operator nor any of its
employees, subcontractors or agents shall be deemed to have any other status, except that
Operator is the agent of Owner to the limited extent that this Agreement expressly grants
Operator the authority to act on behalf of Owner.

Section 1.4 - Representatives. Owner and Operator shall each designate a
representative ("Designated Representative") to act on its behalf in overseeing the
performance of this Agreement. Owner and Operator may change their respective
Designated Representatives upon written notice to the other party given as provided in
this Agreement. Designated Representatives shall be the primary means for
communication and all other interactions between Owner and Operator that are required
under this Agreement. Designated Representatives shall each use best efforts to
cooperate and communicate in a timely manner.

ARTICLE 2
DEFINITIONS

Section 2.1 - Definitions. Unless otherwise required by the context in which a
defined term appears, the following terms shall have the meanings specified in this
Article 2. Terms that are defined in other Articles shall have the meanings given to them
in those Articles.

"Annual Budget" has the meaning set forth in Section 6.2(a).
"Annual Project Operating Plan" has the meaning set forth in Section 6.2.

"Bankruptcy" means a situation in which (i) a party’s actions under applicable debtor
relief laws demonstrate an inability to pay its debts as they mature or a need for
protection from its creditors; (ii) a court of competent jurisdiction approves a petition
filed against a party, which petition sought relief for the party’s creditors, and the action
of the court remains in effect for an aggregated period of 60 days (whether or not
consecutive); (iii) a party admits in writing its inability to pay its debts as they mature;
(iv) a party gives notice to any person or entity of its current (or pending) insolvency or
suspension of operations; or (v) a party makes an assignment for the benefit of creditors
or takes other similar action for the protection or benefit of its creditors.

"Business Day" means any day other than a Saturday, Sunday or other day on which
commercial banks are authorized or required to close in the State of New Hampshire.

"Contract Year" means: (i) for the first Contract Year, that period from the date of this
Agreement to and including December 31 of such year; and (ii) for each Contract Year
thereafter, the calendar year.

“Effective Date” means January 1, 2017.

“Fiscal Year” means July 1 through June 30

Five-Year Budget" has the meaning set forth in Section 6.2(d).

"Force Majeure Event" means an event, condition or circumstance beyond the reasonable
control of, and not due to the fault or negligence of, the party affected, and which could
not have been avoided by due diligence and use of reasonable efforts, which prevents the
performance by such affected party of its obligations hereunder; provided, that a "Force
Majeure Event" shall not be deemed to have occurred or to be continuing unless the party
claiming Force Majeure complies with the requirements of Section 15.3 (Force Majeure).
Subject to the foregoing, "Force Majeure Event" shall include, as to either party,
explosion and fire (in either case to the extent not attributable to the negligence of the
affected party), flood, earthquake, storm or other natural calamity or act of God, strike or
other labor dispute, war, insurrection or riot, actions or failures to act by governmental
entities or officials, failure to obtain governmental permits or approvals (despite timely
application therefor and due diligence) and changes in laws, rules, regulations, orders or
ordinances affecting operation of the Project, which events were not pending on the date
of this Agreement.

“Gross Revenue” shall mean the total revenue of the Project in the preceding quarter
from the sale, trade or auction of electricity, capacity and Renewable Energy Certificates
(“RECs”) and shall include electricity, capacity and RECs which are sold, traded and/or
auctioned during the preceding quarter, even if the payment is not received until after the

calendar year. It is understood that REC payments typically are made four to six months
after they are created (i.e. Gross Revenue for the second quarter (April, May and June) of
the calendar year, shall include REC revenues from generation during the last three
months of the prior calendar year, October, November and December).

“Hazardous Materials” means any petroleum or petroleum products, radioactive materials,
asbestos in any form that is or could become friable, urea formaldehyde foam insulation,
transformers or other equipment that contain dielectric fluid containing polychlorinated
biphenyls and any other chemicals, materials or substances which are now or hereafter
become defined as or included in the definition of “solid wastes,” “hazardous substances,”
“hazardous wastes,” “hazardous materials,” “extremely hazardous substances,” “restricted
hazardous wastes,” “toxic substances” or “toxic pollutants”, “contaminant” or “pollutant”
under, or are regulated or become regulated as such by Law.

“Law_or Laws” means all applicable laws, statutes, codes, acts, treaties, ordinances,
orders, judgments, writs, decrees, injunctions, rules, regulations, approvals, licenses,
permits and directives of all governmental authorities.

"Operating Manuals" means the operating data, design drawings, specifications, vendors'
manuals, warranty requirements, procedures (including those for maintenance of the
Project and environmental and safety compliance), and similar materials with respect to
the Project.

"Project" means the two run-of-river hydropower facilities located in Nashua, NH on the
Nashua River, Mine Falls and Jackson Mills. Project and related assets, together with
other facilities and related assets, constructed on certain real property in Nashua, New
Hampshire.

"Project Agreements" means the agreements relating to the Project, including any Power
Purchase Agreement, Interconnection Agreement, this Agreement and all other
agreements applicable to the Project, permits, and licenses required for the operation,
maintenance and management of the Project, as identified in Appendix D, as updated
from time to time by Owner.

"Prudent Utility Practice" means (i) any of the practices, methods, and acts engaged in or
approved by a significant portion of the hydroelectric generation industry in New
England during the relevant time period, and/or (ii) practices, methods and acts that, in
the exercise of reasonable judgment on the facts known (or that reasonably should have
been known) at the time a decision was made, could have been expected to accomplish
the desired result at a reasonable cost consistent with good business practices, reliability,
safety and expedition. In all circumstances, Prudent Utility Practice shall comply with
then-applicable Laws.

"Reference Rate" means the rate published in the Money Rates table of The Wall Street
Journal, from time to time, as the "prime rate", plus 1%.

"Reimbursable Costs" has the meaning set forth in Section 5.3.

4

"Services" has the meaning set forth in Article 3.1.

ARTICLE 3
SERVICES

Section 3.1 - Scope of Services. Operator shall (i) operate, maintain and manage
the Project on behalf of Owner as described in this Agreement, including Appendix A
and (ii) also perform the specific duties set forth in this Agreement if they are not
otherwise required by the standards defined in Section 3.2 (collectively, “Services”).

Section 3.2 - Standards for Performance of the Services. Operator shall perform the
Services, in a prudent, reasonable, and efficient manner and in accordance with (i)
Operating Manuals and applicable vendor warranties, (ii) the applicable Annual Project
Operating Plan and Annual Budget, (iii) all applicable Laws, (iv) Prudent Utility
Practices, (v) the Project Agreements, and (vi) all insurance policies specified in Article 9
of this Agreement. Operator shall use all reasonable efforts to optimize the useful life of
the Project and to minimize Reimbursable Costs and Project outages or other
unavailability.

Section 3.3 - Operator's Personnel Standards. Operator shall provide as
reasonably necessary all labor and professional, supervisory and managerial personnel as
are required to perform the Services. Such personnel shall be qualified to perform the
duties to which they are assigned and shall meet any requirements for Project personnel
under the Project Agreements. All individuals employed by Operator to perform the
Services shall be employees of Operator, and their working hours, rates of compensation
and all other matters relating to their employment shall be determined solely by Operator
(subject to Owner's approval rights with respect to the Annual Budget). With respect to
labor matters, hiring personnel, and employment policies, Operator shall comply with all
applicable Laws. Operator also shall act in a reasonable manner that is consistent with
the intent and purpose of this Agreement and with Operator’s acknowledgment (hereby
given) that Operator has no authority to enter into any contracts with respect to labor
matters that purport to bind or otherwise obligate Owner.

Section 3.4 - Compliance. Operator shall comply with all Laws applicable to the
operation, maintenance and management of the Project and the performance of the
Services. Operator shall apply for and obtain, and Owner shall provide reasonably
necessary assistance to Operator in applying for and obtaining, all necessary permits,
licenses and approvals (and renewals of the same) required to allow Operator to perform
the Services in the jurisdictions where the Services are to be performed. Operator shall
assist Owner, to secure exemptions, permits, licenses, and approvals (and renewals of the
same) that Owner is required or desires to obtain from or file with any governmental
agency regarding the Project. Operator shall also assist Owner in connection with
Owner's compliance with reporting requirements under the Project Agreements,
applicable Laws or any other agreement to which Owner is a party relating to the Project.

Such assistance shall include providing reports, records, logs and other information that
Owner may reasonably request as to the Project or its operation. Operator also shall file
such reports, notices, and other communications as may be required by any governmental
agency regarding the Project. Owner shall review and approve all such filings prior to
submittal.

Section 3.5 - Operating Records and Reports. Operator shall maintain and
update, as necessary, at a location acceptable to Owner, all documents provided to the
Operator by Owner or in the Operator’s possession at the start of this Agreement, or in
the case of Mine Falls, following the City’s acquisition of the facility, including the
Project Operating Manuals, records, and reports that document the operation and
maintenance of the Project, all in form and substance sufficient to meet Owner's reporting
requirements under the Project Agreements. Operator shall maintain current revisions of
drawings, specifications, lists, clarifications and other materials related to operation and
maintenance of the Project provided to Operator by Owner and vendors.

Section 3.6 - No Liens or Encumbrances. Operator shall maintain the Project free
and clear of all liens and encumbrances resulting from any action of Operator or work
done at the request of Operator.

Section 3.7 - No Action. Except where such action is expressly permitted by this
Agreement, Operator shall not take any action that would cause a default under any
Project Agreement.

Section 3.8 - Emergency Action. If an emergency endangering the safety or
protection of persons, the Project, or property located near the Project occurs, Operator
shall take all necessary action to attempt to prevent or mitigate any such threatened
damage, injury or loss and notify Owner as soon as safely possible. Operator shall make
reasonable efforts to minimize any cost associated with remedial action in case of such an
emergency.

Section 3.9 - Action in Extraordinary Circumstances. In the event that

(A) the Project or major Project equipment suffers an unplanned outage (or
Operator reasonably believes that such an occurrence is imminent), and

(B) Operator has made reasonable, but unsuccessful, efforts to notify and
communicate with Owner regarding such occurrence or imminent occurrence in
accordance with the terms of this Agreement, then Operator shall

(i) take all necessary action to prevent or to mitigate such unplanned outage,

(ii) make reasonable efforts to minimize any cost associated with such remedial
action,

(ii1) continue to attempt to notify and communicate with Owner regarding the
occurrence and the remedial action, and

(iv) shall not expend for such purposes more than an aggregate of $10,000 per
incident, unless such expenditures would prevent further expenses or losses that would
exceed the expenditure cost.

ARTICLE 4
OWNER RESPONSIBILITIES

Section 4.1 - Information. Owner shall provide Operator with all vendor manuals,
spare parts lists, Project data books and drawings which are provided to Owner pursuant
to any Project Agreement or by any contractor responsible for construction, installation,
repair or maintenance of the Project or a part thereof. Subject to the standards of
performance set forth in Section 3.2, Operator shall be entitled to rely upon such
information in performance of the Services. Owner shall also provide Operator with
copies of all Project Agreements and any amendments thereto and any other documents
that define the Project's operating requirements.

Section 4.2 - Overhaul of Major Equipment and Capital Improvements. The cost
of all major equipment teardowns and overhauls and all capital improvements shall be the
responsibility of Owner. Operator shall promptly notify Owner in writing of any such
teardowns and overhauls of major equipment or capital improvements that Operator
believes are necessary or advisable together with a proposed schedule and budget for
completing such repairs or improvements. To the extent reasonably possible, the costs of
all major equipment teardowns and overhauls and all capital improvements shall be
incorporated into the applicable Annual Budget. If such costs have been incorporated
into the applicable approved Annual Budget, or if Owner has otherwise consented in
writing to reimburse Operator for such costs, Operator shall schedule, coordinate, assist
Owner in contracting for and oversee the performance of such activities. Operator also
shall be responsible for monitoring and enforcing contract compliance by the contractor
performing such work, including taking such steps, short of litigation, to enforce any
warranties granted to Owner by such contractor.

Section 4.3 - Annual Budget and Project Operating Plan. In accordance with
Article 6, Owner shall be responsible for approval of the Annual Budget, the Annual
Project Operating Plan and the Five-Year Budget.

Section 4.4 — Owner Contracting Party As owner of the Project, Owner shall be
the entity named on all contracts, agreements, regulatory correspondence and other legal
or necessary documents in relation to the Project. Owner, at its sole discretion, may
name Operator as its designee to act on its behalf to take such action as necessary to
ensure continued operation of the Project. Prior Owner approval is required for contracts
relating to the Project of over (Ten Thousand Dollars) $10,000.

ARTICLE 5
COMPENSATION AND PAYMENT

Section 5.1 - Payments. As compensation to Operator for performance of the
Services hereunder, Owner shall pay Operator an Administrative fee as specified in
Appendix B. In addition, Owner shall (at Owner’s Option) either (i) retmburse Operator,
in the manner and at the times specified in this Article 5 and Appendix B, as modified