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8163 - Binder Executed Docusign Transmittal Coversheet File Name Purchasing Contact Contract Expiration DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 8163 - DME 2023 Winter Outage Insurance Christa Christian March 31, 2023 4000 W. 114th Street, Suite 190, Leawood, KS 66211 Phone: 913-981-9935 January 19, 2023 Ms. Christine Taylor Director of Procurement and Compliance Denton Municipal Electric City of Denton A Texas Home-Rule Municipal Corporation 215 East McKinney Street Denton, Texas 76201 Re: Binder for Underwriters at Lloyd's, London Policy # 246528 We have been instructed by Underwriters at Lloyd's, London to deliver the executed insurance policy attached hereto, binding coverage effective January 20, 2023. Please sign and return by email to jcassity@archer-risk.com. Accepted by: Signature: _________________________________ Name: ____________________________________ Title: _____________________________________ Date: _____________________________________ DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 1/20/2023 Laura Behrens Assistant Procurement Director Archer Contingent Energy Risk, LLC on behalf of various Lloyd’s Syndicates 4000 W 114th St, Suite 190 Leawood KS 66211 Page 1 of 18 DECLARATIONS Policy No.: 246528 ITEM 1. INSURED: City of Denton, a Texas municipal home rule corporation PRINCIPAL ADDRESS: 215 East McKinney Denton, TX 76201 WIRE TRANSFER: Wells Fargo Bank N.A. ABA: 121000248 Acct #: 2000029864180 Beneficiary: City of Denton ITEM 2. INSURER: Underwriters at Lloyd’s, London ITEM 3. WIRE TRANSFER: WSFS Bank ABA: 031100102 Account: Archer Premium Account for Ark Syndicate Account Number: 214657389 ITEM 4. CONTACT FOR INSURER: Archer Contingent Energy Risk (Archer) c/o Jon Cassity 4000 W. 114th Street, Suite 190 Leawood, KS 66211 Tel.: 913-981-9944 Cell: 913-461-8518 Email: jcassity@archer-risk.com ITEM 5. PERIL(S) INSURED AGAINST: Losses incurred to replace the power that otherwise would have been generated by Covered Unit(s) experiencing an Unplanned Event ITEM 6. CURRENCY: United States Dollars (“USD”) ITEM 7. INCEPTION DATE: January 20, 2023 ITEM 8. EXPIRATION DATE: March 31, 2023 ITEM 9. COVERAGE PERIOD: January 20, 2023 through March 31, 2023 ITEM 10. CLAIMS DEADLINE: April 28, 2023 ITEM 11. POLICY LIMIT: $10,000,000.00 ITEM 12. PREMIUM: $450,000.00 SURPLUS LINES TAX 4.85%: $21,825.00 STAMPING FEE OF 0.075%: $337.50 TOTAL: $472,162.50 ITEM 13. PREMIUM DUE DATE: January 31, 2023 DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 Archer Contingent Energy Risk, LLC on behalf of various Lloyd’s Syndicates 4000 W 114th St, Suite 190 Leawood KS 66211 Page 2 of 18 ITEM 14. INSURED PRICE: Insured Price varies for the Delivery Intervals of each month and period as set forth below. On Peak Hours Off-Peak Hours Weekend Peak Hours January: $40.41/MWh $37.30/MWh $37.30/MWh February: $61.30/MWh $38.99/MWh $61.30/MWh March: $41.95/MWh $25.86/MWh $39.85/MWh ITEM 15. SETTLEMENT TYPE: 15-minute (7 x 96) ITEM 16. POWER PRICE INDEX: For each Delivery Interval of each Delivery Day, the Real-Time Price. Where: Real-Time Price means the corresponding 15-minute Settlement Interval Real-Time Settlement Point Price, stated in $/MWh, for the ERCOT North 345 kV Hub as published by ERCOT. ITEM 17. AGGREGATE CAPACITY DEDUCTIBLE: 18.75 MW ITEM 18. CAPACITY LIMIT: 206.25 MW ITEM 19. EVENT DURATION LIMIT: 1,392 consecutive hours (58 consecutive calendar days) ITEM 20. COINSURANCE: 0 ITEM 21. TERM DEDUCTIBLE: $0.00 ITEM 22. RETENTION PERIOD: 0 hours ITEM 23. ENDORSEMENTS: N/A ITEM 24. UNPLANNED EVENT: Unplanned Outage, or Unplanned Derate ITEM 25. DELIVERY INTERVALS: Each Delivery Day any 15-minute period ending 15, 30, 45 or 60 minutes past the top of the hour ITEM 26. DELIVERY DAY: Any Day during the Coverage Period ITEM 27. RELEVANT TIME ZONE: Central ITEM 28. OFF-PEAK HOURS: All hours that are not On-Peak Hours or Weekend Peak Hours ITEM 29. ON-PEAK HOURS: On each Delivery Day that is a Monday, Tuesday, Wednesday, Thursday or Friday, the hours ending 0700 through 2200 Prevailing Time DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 Archer Contingent Energy Risk, LLC on behalf of various Lloyd’s Syndicates 4000 W 114th St, Suite 190 Leawood KS 66211 Page 3 of 18 ITEM 30. WEEKEND PEAK HOURS: On each Delivery Day that is a Saturday or Sunday, the hours ending 0700 through 2200 Prevailing Time The binding authority agreement between Archer Contingent Energy Risk, LLC and the various Lloyds syndicates is referenced UMR: B133823ARC0024. THESE DECLARATIONS, TOGETHER WITH THE INSURANCE APPLICATION AND THE POLICY (INCLUDING THE SCHEDULES, EXHIBITS AND ANY ENDORSEMENTS ATTACHED), CONSTITUTE THE INSURANCE POLICY (the “Policy”). DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 Archer Contingent Energy Risk, LLC on behalf of various Lloyd’s Syndicates 4000 W 114th St, Suite 190 Leawood KS 66211 Page 4 of 18 OUTAGE INSURANCE POLICY Capitalized terms have special meanings found in Definitions (Section 2) and the Declarations. SECTION 1. INSURING CLAUSE In consideration of receipt of the Premium by the Insurer, and subject to the Declarations, limits, conditions, representations, exclusions, provisions and other terms of this Policy, the Insurer agrees to indemnify and pay to the Insured an amount equal to the Outage Loss arising from Unplanned Event(s). SECTION 2. DEFINITIONS The following capitalized terms shall have the meanings ascribed to them below, and those specifically set forth in the Declarations shall have the meaning set forth therein. A. Aggregate Capacity Deductible is the quantity (expressed in megawatts (“MW”)) specified in Item 17 of the Declarations. B. Business Day means any day that is a Monday, Tuesday, Wednesday, Thursday, or Friday on which banking institutions in the State of New York are not authorized or obligated by law or executive order to close. C. Capacity means the net dependable power generation capacity of a Covered Unit expressed in MW, but in no event is to exceed the quantity (expressed in MW) specified in Exhibit A of this Policy in respect of such Covered Unit. Note that this term is intended to describe the capability of the Covered Unit and is not used directly in the calculation of Outage Loss. D. Capacity Limit is the quantity (expressed in MW) specified in Item 18 of the Declarations. E. Capacity Ratio is the proportion of generation from a Covered Unit that is included in determination of Outage Capacity, and is equal to the amount (expressed as a percentage) set forth in Exhibit A for each Covered Unit. If a Capacity Ratio is not specified in Exhibit A, it is deemed equal to 1.0. F. Claims Deadline is the date specified in Item 10 of the Declarations. G. Coinsurance is the pro rata share of losses that are not included in the calculation of Outage Losses pursuant to Section 8A of this Policy, and which amount is specified in Item 20 of the Declarations. H. Contact For Insurer is the contact person specified in Item 4 of the Declarations. I. Coverage Period means the period of time specified in Item 9 of the Declarations. J. Covered Capacity means, in respect of each Delivery Interval, the amount by which the sum of Outage Capacity amounts for such Delivery Interval across all Covered Units exceeds the Aggregate Capacity Deductible. For the purposes of calculating Outage Losses, in no event shall the Covered Capacity exceed the Capacity Limit. K. Covered Unit(s) means the power generating unit(s) listed on Exhibit A of this Policy which can be subject to an Unplanned Event. DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 Archer Contingent Energy Risk, LLC on behalf of various Lloyd’s Syndicates 4000 W 114th St, Suite 190 Leawood KS 66211 Page 5 of 18 L. Day means the 24-hour period beginning at HE 0100 Prevailing Time in the Relevant Time Zone and ending at HE 2400 Prevailing Time in the Relevant Time Zone except that on the Day on which Daylight Time becomes effective in the Relevant Time Zone, the period shall be 23 hours, and on the Day on which Standard Time becomes effective in the Relevant Time Zone, the period shall be 25 hours. M. Daylight Time means daylight time in effect in the Relevant Time Zone from time to time. N. Declarations means the attachment hereto headed “Declarations”. O. Delivery Day means any Day as specified in Item 26 of the Declarations. P. Delivery Interval means any interval as specified in Item 25 of the Declarations. Q. Event Duration Limit means, in respect of each Unplanned Event, the number of hours specified in Item 19 of the Declarations. R. Expiration Date is the date specified in Item 8 of the Declarations. S. Governmental Authority means any federal, territorial, state or local governmental authority, court commission, tribunal or any political or other subdivision, department, branch or representative of any of the foregoing. T. Hour Ending or HE means a consecutive sixty-minute period ending at 00. U. Inception Date is the date specified in Item 7 of the Declarations. V. Insurance Application means a completed application for this Policy including supporting materials provided to the Insurer by the Insured or agents of the Insured. W. Insured means the entity named in Item 1 of the Declarations. X. Insured Capacity is the maximum Outage Capacity attributable to a Covered Unit and is equal to the quantity (expressed in MW) set forth in Exhibit A in respect of such Covered Unit. Y. Insured Price means the price (expressed in USD per Megawatt Hour (“MWh”)) specified in Item 14 of the Declarations. Z. Insurer means the insurance company specified in Item 2 of the Declarations. AA. Malicious Computer Code means any corrupting, harmful or otherwise unauthorized instructions or code, including, without limitation: (i) unauthorized instructions or code, programmatic or otherwise, that propagates itself through a computer system or network of any nature whatsoever, such as, but not limited to computer viruses, “worms,” or “Trojan horses”; (ii) system, resource or code modifying programs, such as, but not limited to, “time-bombs,” “usage authorizations codes,” and “back doors”; (iii) programs designed to record activities on any computer, network or control systems, such as, but not limited to, “spyware,” “keyloggers” and other tracking software; and (iv) other programs or programming devices used to modify, delete, damage, deactivate or disable a computer, network or control system, or other software, computer hardware or data. BB. Off-Peak Hours means the hours specified in Item 28 of the Declarations. DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 Archer Contingent Energy Risk, LLC on behalf of various Lloyd’s Syndicates 4000 W 114th St, Suite 190 Leawood KS 66211 Page 6 of 18 CC. On-Peak Hours means the hours specified in Item 29 of the Declarations. DD. Outage Capacity means the power generation capacity, measured in MW for each Delivery Interval for each Delivery Day during the Coverage Period, actually lost in respect of a Covered Unit due to an Unplanned Event. The Outage Capacity shall be equal to the Capacity Ratio multiplied by the amount of power generation capacity lost less the Unit Deductible set forth in Exhibit A, but in no event shall it (i) exceed the level at which the Covered Unit was (or would have been) scheduled to operate during the time it was non-operational due to the Unplanned Event, or (ii) have a value less than zero. If Outage Capacity exceeds Insured Capacity for a Covered Unit, the Outage Capacity for such Covered Unit shall be deemed equal to the Insured Capacity. EE. Outage Loss or Outage Losses means the costs (expressed in USD) incurred by the Insured during the Coverage Period as a result of a loss of power output from one or more Covered Units that experience an Unplanned Event, and which is equal to the amount determined in accordance with Section 8A of this Policy and, as set forth in Section 8A, shall in no event exceed the actual loss incurred by the Insured. FF. Planned Derate means any derate that is, or could be, scheduled more than fourteen (14) Days in advance. GG. Planned Outage means any outage that is, or could be, scheduled more than fourteen (14) Days in advance. HH. Policy Limit means the amount (expressed in USD) specified in Item 11 of the Declarations. II. Power Price Index means the source used for power prices specified in Item 16 of the Declarations. JJ. Premium means the amount (expressed in USD) specified in Item 12 of the Declarations. KK. Premium Due Date means the date specified in Item 13 of the Declarations. LL. Prevailing Time (PT) means the local time in the Relevant Time Zone of the United States as determined by the National Institute of Standards and Technology of the United States Department of Commerce. MM. Proof of Loss means a sworn affidavit in the form of Exhibit B hereto, which shall be subject to verification in accordance with Section 8B hereof. NN. Prudent Industry Practice means any of the acts, practices, methods, techniques and standards that in the exercise of reasonable judgment in the light of the facts, including but not limited to the practices, methods and acts engaged in or approved by a significant portion of the electric utility industry prior thereto, known at the time the decision was made, would have been expected to accomplish the desired result at a reasonable cost consistent with reliability, safety, and expedition. Prudent Industry Practice is not intended to be limited to a single best practice, method or act to the exclusion of all others, but rather to be any practice then generally accepted, having due regard for, among other things, compliance with reasonable maintenance recommendations of equipment manufacturers, operational guidelines, repair methods, maintenance and security of computer, network and control systems (including, without limitation, protection from Malicious Computer Code), contractual obligations, requirements of Governmental Authorities, operating rules or procedures of transmission operators, reliability councils, or other existing conditions. OO. Relevant Time Zone means the time zone specified in Item 27 of the Declarations. DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 Archer Contingent Energy Risk, LLC on behalf of various Lloyd’s Syndicates 4000 W 114th St, Suite 190 Leawood KS 66211 Page 7 of 18 PP. Retention Period means, in respect of each Unplanned Event, the number of hours specified in Item 22 of the Declarations. QQ. Settlement Type means the period of time in which a unique value for the Power Price Index is determined, and which is specified in Item 15 of the Declarations. RR. Standard Time means standard time in effect in the Relevant Time Zone from time to time. SS. Term Deductible means the amount (expressed in USD) specified in Item 21 of the Declarations. TT. Unit Deductible means the quantity (expressed in MW) specified in Exhibit A. If a Unit Deductible is not specified in Exhibit A, it is deemed equal to zero (0). UU. Unplanned Outage means a power generation outage event classified as a class U1, U2, U3 or SF unplanned outage under the North American Electric Reliability Corporation’s Generating Availability Data System as in effect on the Inception Date (“NERC GADS”), during which a Covered Unit is not capable of producing power due to unanticipated failure within the plant site, including the closed cooling systems of the generators, up to and including, the generator step-up transformer. Unplanned Outage does not include any Planned Outage, as defined herein. An Unplanned Outage will be deemed to have commenced the number of hours in the Retention Period after the time at which such power generation outage event first occurred. Such Unplanned Outage will be deemed to have concluded at the earlier of (i) the time at which the cause of the event is corrected and the Covered Unit is capable of producing energy, or (ii) time at which the Unplanned Outage reaches the Event Duration Limit, but in no event shall it conclude beyond the time that would be required to correct the cause of outage with exercise of Prudent Industry Practice. More than one Unplanned Outage may occur during the Coverage Period. In no event shall an Unplanned Outage be deemed to include any unplanned power generation outage of the types described in Section 6D of this Policy. VV. Unplanned Derate means a power generation derate event classified as a class D1, D2, or D3 unplanned derate under the NERC GADS, during which a Covered Unit’s capability to produce power is reduced due to unanticipated failure within the plant site, including the closed cooling systems of the generators, up to and including, the generator step-up transformer. Subject to the terms hereof, an Unplanned Derate may include a derating immediately following an Unplanned Outage; provided that if the proximate cause of the Unplanned Derate is the same as the immediately preceding Unplanned Outage, then a single Event Duration Limit shall be applicable, collectively, to the Unplanned Outage and the Unplanned Derate. Unplanned Derate does not include any Planned Derate, as defined herein. An Unplanned Derate will be deemed to have commenced the number of hours in the Retention Period after the time at which such power generation derate event first occurred. An Unplanned Derate will be deemed to have concluded at the earlier of (i) the time at which the cause of the event is corrected and the Covered Unit is available to generate the same volume of power it was able to generate immediately prior to such Unplanned Derate, or (ii) time at which the Unplanned Derate reaches the Event Duration Limit but in no event shall it conclude beyond the time that would be required to correct the cause of derate with exercise of Prudent Industry Practice. More than one Unplanned Derate may occur during the Coverage Period. In no event shall an Unplanned Derate be deemed to include any unplanned power generation outage of the types described in Section 6D of this Policy. WW. Unplanned Event means the event specified in Item 24 of the Declarations. XX. Weekend Peak Hours means the hours specified in Item 30 of the Declarations. DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 Archer Contingent Energy Risk, LLC on behalf of various Lloyd’s Syndicates 4000 W 114th St, Suite 190 Leawood KS 66211 Page 8 of 18 SECTION 3. PREMIUM The Premium with respect to this Policy is fully earned by the Insurer on the Inception Date, except as otherwise provided in Section 5 herein. It is understood and agreed that no coverage shall attach under this Policy prior to the Inception Date and the Insurer shall have no obligation or liability under this Policy unless and until the Insurer actually receives all the Premium on or prior to the Premium Due Date. SECTION 4. POLICY LIMIT Notwithstanding anything herein to the contrary, the Insurer’s maximum dollar liability to the Insured arising under this Policy for any and all Outage Losses shall not exceed the Policy Limit specified in the Declarations. SECTION 5. CANCELLATION AND NONRENEWAL A. This Policy may be cancelled by the Insured by surrender of this Policy to the Insurer or by mailing to the Insurer written notice stating when thereafter such cancellation shall be effective, in the event of: 1. a material change in the risk being insured, or 2. a mutual agreement between the Insurer and the Insured. B. The Insurer may cancel this Policy by mailing or delivering to the Insured, and to the authorized agent or broker, a written notice stating when, not less than upon thirty (30) calendar days thereafter, the cancellation shall be effective, in the event of any of the following: 1. if there is a discovery of fraud or material misrepresentation in the obtaining of this Policy or in the presentation of a claim thereunder, 2. if, after issuance of this Policy or after the last renewal date, discovery of an act or omission, or a violation of any Policy condition that materially increases the hazard insured against, and which occurred subsequent to the inception of the current Policy Period, or 3. non-payment of any Premium on or prior to any Premium Due Date, which will result in cancellation of this Policy ab initio. If such Premium is paid in full to the Insurer before the notice period expires, such cancellation shall automatically be revoked. C. At and after such date of cancellation, the Insurer shall have no liability or obligation to pay any claims for any Outage Losses incurred on or after said date. If this Policy is cancelled by the Insurer after the Premium has been received by the Insurer, within thirty (30) days of the effective date of cancellation, the Insurer shall return to the Insured a pro rata portion of said Premium equal to the total amount of Premium paid multiplied by a fraction, the numerator of which shall be the number of days, multiplied by the total Insured Capacity for each day, remaining from the effective date of cancellation up to and including the Expiration Date, and the denominator of which shall be the number of days, multiplied by the total Insured Capacity for each day, from the first Day of Coverage Period to the last Day of Coverage Period. If this Policy is canceled by the Insured after the Premium has been received by the Insurer, within thirty (30) days of the effective date of cancellation, the Insurer shall return to the Insured a short rate portion of said Premium which shall be reasonably determined by the Insurer based upon all of the facts and circumstances of the cancellation. Payment or tender of any unearned premium by the Insurer shall not be a condition of cancellation, but such payment shall be made within thirty (30) days of such cancellation. D. This Policy is not renewable. DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 Archer Contingent Energy Risk, LLC on behalf of various Lloyd’s Syndicates 4000 W 114th St, Suite 190 Leawood KS 66211 Page 9 of 18 SECTION 6. EXCLUSIONS Notwithstanding any other provision of this Policy, this Policy does not cover: A. any event, fact, loss or circumstance other than an Outage Loss as defined by this Policy; B. the cost to repair or replace property, including data, of the Insured or of any other person or entity or the cost to mitigate any damages to property of the Insured or of any other person or entity; C. any obligation, liability or accommodation of any kind to or of a third party; D. events either directly initiated or directly extended by any of the following: 1. the gross negligence, willful misconduct, or fraud of either (i) the Insured or its employees, agents, independent contractors or affiliates, or (ii) the owner or operator of any Covered Unit or its employees, agents, independent contractors or affiliates; 2. compliance with any local, state or federal laws, regulations or guidelines; or any official governmental, court, regulatory, or control area order, proceeding or action; 3. inadequate quality or quantity of fuel, inadequate supply of cooling water, or transmission system disruption, in each case except to the extent resulting directly from mechanical failure of any equipment located within the plant boundary of the Covered Unit; 4. extension of a Planned Outage, unless such extension is necessary (i) for the operator of the Covered Unit to comply with Prudent Industry Practice, and (ii) to correct a condition that, in the reasonable opinion of the operator of the Covered Unit, is likely to cause an Unplanned Event during the Coverage Period; 5. earthquake, tornado, flood, named storms, or any other natural disasters; or 6. any riot, sabotage, Malicious Computer Code, radioactive contamination, domestic or foreign initiated terrorism, insurrection, strike, labor dispute, declared or undeclared war or civil disorder. E. any Outage Losses which arise from or are directly related to a failure to maintain or repair a Covered Unit in accordance with Prudent Industry Practice. SECTION 7. NOTIFICATION OF UNPLANNED EVENT A. The Insured shall notify Archer of the occurrence of an Unplanned Event no later than one (1) Business Day after the commencement of the Unplanned Event. In the event notification occurs later than as set forth in the preceding sentence, then no Outage Losses shall be deemed to be incurred until notice is received by Archer. This notification shall be made by telephone or by e-mail transmission to the following individuals: Archer Contingent Energy Risk Archer Contingent Energy Risk c/o John Bundy c/o Jon Cassity 4000 W. 114th Street, Suite 190 4000 W. 114th Street, Suite 190 Leawood, KS 66211 Leawood, KS 66211 Tel.: 203-240-6072 Tel.: 913-981-9944 Email: jbundy@archer-risk.com Email: jcassity@archer-risk.com DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 Archer Contingent Energy Risk, LLC on behalf of various Lloyd’s Syndicates 4000 W 114th St, Suite 190 Leawood KS 66211 Page 10 of 18 B. In order to obtain coverage under this Policy, the Insured must have also submitted a fully completed and properly executed Proof of Loss, on or before the Claims Deadline substantiating Outage Losses incurred by the Insured arising from Unplanned Event(s). SECTION 8. DETERMINATION OF LOSS AND VERIFICATION A. DETERMINATION OF OUTAGE LOSS. The Insurer will indemnify the Insured for the amount of Outage Losses sustained by the Insured as a result of an Unplanned Event, as calculated in this Section 8A below, subject to the terms, limits and conditions of this Policy. Subject to the last paragraph of this Section 8A, if during any Delivery Interval of a Delivery Day (i) an Unplanned Event occurs or is continuing, and (ii) the Power Price Index applicable to such Delivery Interval is greater than the Insured Price, then, for every Delivery Interval of each Delivery Day during which all such conditions persist, the Outage Losses payable hereunder shall equal the product of (A) the positive difference between the Power Price Index applicable to such Delivery Interval and the Insured Price, (B) the Covered Capacity for such Delivery Interval, and (C) (1-the amount of Coinsurance (expressed as a decimal)). Notwithstanding anything herein to the contrary, in no instance shall the loss based upon the calculation above as well as consideration of any recoveries or reimbursements to the Insured resulting from the Unplanned Event(s) exceed the actual loss incurred by the Insured. Subject to the foregoing and the last paragraph of this Section 8A, the amount of loss payments due to Insured by Insurer in respect of each valid Proof of Loss shall equal the amount calculated using the following formula: (Aggregate Outage Losses - (Term Deductible + the aggregate amount of loss payments made to Insured by Insurer under this Policy prior to any payment in respect of such Proof of Loss)). Aggregate Outage Losses means, as of any date, the sum of all Outage Losses sustained by the Insured as a result of one or more Unplanned Events, all as calculated under Section 8A of this Policy on and before such date. The Insurer’s aggregate liability cannot under any circumstances exceed the Policy Limit in any Coverage Period for all Outage Losses occurring in such Coverage Period. B. VERIFICATION. Upon receipt of a Proof of Loss, which must include, without limitation, sufficient information for the Insurer to determine that an Unplanned Event has occurred and that such Unplanned Event would not be subject to an exclusion pursuant to Section 6 of this Policy, the Insurer shall have the right to investigate, audit and otherwise verify the Outage Loss and/or the claim for payment to the extent it deems reasonably necessary. The Insured shall reasonably cooperate with the Insurer in conducting any such investigation, audit and/or verification. Such right shall include, without limitation, the right to verify whether events, facts or circumstances giving rise to the Outage Loss have occurred under this Policy and the amount of Outage Loss due hereunder. SECTION 9. PAYMENT OF LOSS Subject to Sections 4 and 8 of this Policy, the Insurer shall, within thirty (30) Business Days of receipt and acceptance of a fully completed and properly executed Proof of Loss accompanied by the documentation referred to therein, make payment to the Insured in the amount of the Outage Loss claimed in the Proof of Loss, as full settlement of such claim. Insured is permitted to file any number of Proofs of Loss from time to time on or prior to the Claims Deadline. DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 Archer Contingent Energy Risk, LLC on behalf of various Lloyd’s Syndicates 4000 W 114th St, Suite 190 Leawood KS 66211 Page 11 of 18 SECTION 10. CLAIMS DEADLINE All claims under this Policy must be received by the Insurer no later than the Claims Deadline set forth in Item 10 in the Declarations. SECTION 11. SUBROGATION AND REFUNDS A. SUBROGATION. In the event of a payment of Outage Loss, the Insurer reserves the right to pursue an action for recovery from any person, other than the Insured, at its sole discretion and in the name of the Insured or otherwise. If the Insurer makes any payment under this Policy with respect to an Outage Loss, the Insurer shall be subrogated, to the extent of such payment, to all the rights and remedies of the Insured, and the Insurer shall be entitled at its own expense (and not in reduction of the Outage Loss) to sue in the name of the Insured. The Insured shall cooperate in all respects to assist the Insurer in exercising any subrogation rights hereunder. B. REIMBURSEMENT. If, after the making of any payment by the Insurer hereunder, the Insurer determines that the Insured was not entitled to all or part of a payment made by the Insurer hereunder because, without limitation, the Outage Loss is either not covered or is excluded by the terms and conditions of this Policy, or the amount of payment made by the Insurer is in excess of the Outage Loss, the Insured shall pay any and all such amounts in immediately available funds to the Insurer within ten (10) Business Days of such determination by the Insurer. C. INTEREST ON AMOUNTS DUE. If either party fails to pay amounts due the other on a timely basis as specified in this Policy or the Declarations, such amounts shall be paid with interest thereon at the rate per annum payable with respect to United States Treasury Bills with a one-year maturity plus 1% additional interest on the amount past due accruing from the date such payment is overdue. SECTION 12. MISCELLANEOUS MATTERS A. NO AMENDMENTS. No amendment, modification or change to this Policy may be made except by written endorsement to this Policy which has been executed by the Insurer and the Insured. B. NO ASSIGNMENT. This Policy may not be assigned or transferred, and any rights that may arise under this Policy (including any claims made or that may be made), without limitation, may not be assigned or transferred, in each case including by operation of law, unless agreed to by the Insurer in advance in writing. In the absence of such consent, any such assignment or delegation shall be null and void. C. SOLE BENEFIT. Except as otherwise provided herein, this Policy shall inure only to the benefit of the Insured, and no person other than the Insured (or a permitted assignee or transferee pursuant to Section 12B above) shall have any legal or equitable right, remedy or claim under or in respect of this Policy. D. FALSE OR FRAUDULENT CLAIMS. If any claim shall be made hereunder by the Insured knowing the same to be false or fraudulent, as regards amount or otherwise, then in such an event coverage for said claim shall be denied and all rights to coverage which otherwise would inure to the Insured shall be forfeited. E. INTERNATIONAL SANCTIONS. Insurer shall not be deemed to provide cover and shall not be liable to pay any claim or provide any benefit hereunder to the extent that the provision of such cover, payment of such claim or provision of such benefit would expose Insurer to any sanction, prohibition or restriction under United Nations resolutions or the trade or economic sanctions, laws or regulations of the European Union, United Kingdom or United States of America. DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 Archer Contingent Energy Risk, LLC on behalf of various Lloyd’s Syndicates 4000 W 114th St, Suite 190 Leawood KS 66211 Page 12 of 18 F. ENTIRE AGREEMENT. This Policy (including the Declarations and Exhibits hereto) and the Insurance Application constitute the entire agreement between the Insurer and the Insured with respect to the insurance provided hereby and supersede any other prior agreements or documents, whether written or oral, between them pertaining to the insurance provided hereunder. G. CURRENCY. Any amount paid in consideration hereof, or pursuant to the terms and conditions hereof, shall be paid in the Currency specified in Item 6 of the Declarations. H. NO WAIVER OF RIGHTS. A failure or delay in exercising any right, power or privilege in respect of this Policy, other than under Section 7B, will not be presumed to operate as a waiver of that right, power or privilege. I. HEADINGS. The headings used in this Policy are for convenience of reference only and are not to affect the construction of or to be taken into consideration in interpreting this Policy. J. NO RELIANCE ON INSURER. The Insured has reviewed the terms, conditions and significance of this Policy with legal and tax counsel, accountants, and/or insurance advisors of its choice, and is accepting this Policy with full knowledge of its terms, conditions and significance. In accepting this Policy, the Insured is not relying upon any representation or warranty by the Insurer regarding the legal, tax or accounting implications of this Policy for the Insured. SECTION 13. GOVERNING LAW This Policy shall in all respects be governed by, and construed in accordance with, the laws of the State of Texas, as applicable to insurance contracts entered into in Texas; provided, however, that the Declarations, conditions, exclusions, limits, provisions and other terms of this Policy are to be construed in an evenhanded fashion as between the Insured and the Insurer. Without limitation, if the language of this Policy is deemed to be ambiguous or otherwise unclear, the issues shall be resolved in the manner most consistent with the relevant terms, conditions and limits, without regard to the authorship of the language and without any presumption or arbitrary construction in favor of either the Insured or the Insurer. SECTION 14. REPRESENTATIONS A. The representations, warranties and covenants of the Insured contained herein and in the Insurance Application, and in any Proof of Loss, are the basis for this Policy and a part hereof and are conclusively presumed to be material to the risk assumed by the Insurer under this Policy. False warranty, misrepresentation, concealment or fraud in obtaining this Policy, or in any notification of claim or in any Proof of Loss submitted in accordance with Section 7B of this Policy shall cause coverage to be denied under this Policy. B. Insured represents that: 1. the Covered Unit(s) has been and will continue to be operated in accordance with Prudent Industry Practice, and 2. the physical descriptions and historical performance data with respect to the Covered Unit, provided by or on behalf of Insured to Insurer are true, accurate, and complete as of the date provided in every material respect. DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 Archer Contingent Energy Risk, LLC on behalf of various Lloyd’s Syndicates 4000 W 114th St, Suite 190 Leawood KS 66211 Page 13 of 18 C. If, under applicable law or regulations, warranties as described herein are prohibited or not recognized, then, in conformity therewith, statements of the Insured in regard to this Policy shall be accepted as representations. SECTION 15. NOTICES A. TO THE INSURED. Any notice or other communication to be given to the Insured shall be given effectively if made in writing and delivered to the Insured at its address specified in Item 1 of the Declarations. B. TO ARCHER AND THE INSURER. Any notice or other communication to be given by the Insured shall be given effectively if made in writing and delivered to the individual and address specified in Item 4 of the Declarations, except that notifications of Unplanned Events shall be delivered in accordance with Section 7A. C. CHANGE OF ADDRESS. Either the Insured or Archer may by notice to the other in accordance with this Section 15, change the address at which notices or other communications are to be given to it. SECTION 16. COMPLAINTS Other than as set out in the sections below, Archer does not have authority to handle complaints against the Insurer. Archer shall, in accordance with Section 3, send to the Insurer details of all complaints received by Archer together with all documents relevant to the complaint. For these purposes, a complaint means any written communication where there is an expression of dissatisfaction with an insurance product or service. Complaints may be received directly from a complainant (“Direct Complaints”) or through a state Department of Insurance (or equivalent agency) (“DOI Complaints”). The details and relevant documents referred to in Section 2 shall be sent to the Insurer no later than the end of the next business day after the day that the complaint is received. Details should be sent to: complaints@arkunderwriting.com Thereafter, Archer shall continue to provide promptly to the Insurer any further details or documents received relevant to the complaint. Archer shall maintain a register of all complaints received and shall provide a copy of the same to the Insurer upon request. SECTION 17. DISPUTE RESOLUTION CLAUSE The parties agree that any and all disputes, claims or controversies arising out of or relating to this Policy shall be submitted first to JAMS, or its successor, for mediation, and if the matter is not resolved through mediation, then it shall be submitted, in accordance with Section 17.A. below, for final and binding arbitration pursuant to Section 17B below. A. MEDIATION 1. Either party may commence mediation by providing to JAMS and the other party a written request for mediation, setting forth the subject of the dispute and the relief requested. DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 Archer Contingent Energy Risk, LLC on behalf of various Lloyd’s Syndicates 4000 W 114th St, Suite 190 Leawood KS 66211 Page 14 of 18 2. The parties will cooperate with JAMS and with one another in selecting a mediator from the JAMS panel of neutrals and in scheduling the mediation proceedings. The parties agree that they will participate in the mediation in good faith and that they will share equally in its costs. 3. All offers, promises, conduct and statements, whether oral or written, made in the course of the mediation by any of the parties, their agents, employees, experts and attorneys, and by the mediator or any JAMS employees, are confidential, privileged and inadmissible for any purpose, including impeachment, in any arbitration or other proceeding involving the parties, provided that evidence that is otherwise admissible or discoverable shall not be rendered inadmissible or non-discoverable as a result of its use in the mediation. 4. Either party may initiate arbitration, in accordance with Section 17B, with respect to the matters submitted to mediation by filing a written demand for arbitration at any time following the initial mediation session or at any time following 45 days from the date of filing the written request for mediation, whichever occurs first (“Earliest Initiation Date”). The mediation may continue after the commencement of arbitration if the parties so desire. 5. At no time prior to the Earliest Initiation Date shall either side initiate an arbitration or litigation related to this Policy except to pursue a provisional remedy that is authorized by law or by JAMS Rules or by agreement of the parties. However, this limitation is inapplicable to a party if the other party refuses to comply with the requirements of paragraph 3 above. 6. All applicable statutes of limitation and defenses based upon the passage of time shall be tolled until 15 days after the Earliest Initiation Date. The parties will take such action, if any, required to effectuate such tolling. B. ARBITRATION 1. Arbitration shall be conducted in accordance with the Federal Arbitration Act and, to the extent an issue is not addressed by the federal law on arbitration, by the Procedures for the Resolution of U.S. Insurance and Reinsurance Disputes (April 2004) ("the Procedures"), except as otherwise provided herein. The validity, construction and interpretation of this Policy, and all procedural aspects of the arbitration conducted pursuant thereto shall be decided by the arbitrators. In deciding the substance of any Disputes, the arbitrators shall apply the laws of the State of New York, without regard to conflicts of law principles. It is agreed that the Arbitrators shall have no authority to award treble, exemplary, bad faith, or punitive damages of any type under any circumstances whether or not such damages may be available under state or federal law, or under the Federal Arbitration Act, or under the Commercial Arbitration Rules of the American Arbitration Association, the parties hereby waiving their right, if any, to recover any such damages. 2. The arbitration proceeding shall be conducted in Dallas, Texas, before a panel of three disinterested arbitrators. Within thirty (30) days of the notice of initiation of the arbitration procedure, each party shall select one arbitrator. If either party refuses or neglects to appoint an arbitrator within thirty (30) days, the other party may appoint the second arbitrator. The two arbitrators shall select an umpire, who shall be neutral, in accordance with Section 6 of the Procedures. The parties hereby designate the umpire list maintained by ARIAS (U.S.) as the list to be used in the event that Section 6.7(a) of the Procedures is invoked. The arbitrators and umpire shall be persons who are current or former officers or executives of an insurance or reinsurance company, with no interest in the outcome of the proceeding, and not under the control of either of the parties. Section 11.1 of the Procedures shall be replaced by the following provision: "The parties may propound discovery seeking disclosure of such information and/or documents relevant to the dispute or necessary for the proper resolution of the dispute." DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 Archer Contingent Energy Risk, LLC on behalf of various Lloyd’s Syndicates 4000 W 114th St, Suite 190 Leawood KS 66211 Page 15 of 18 3. Either party may apply to a Texas state or federal court having jurisdiction for an order confirming the award; a judgment of such court will thereupon be entered on the award. If such an order is issued, the party against whom confirmation is sought will pay the attorney's fees and costs the applying party incurs in pursuing the order. 4. Each party will pay the fees of its own attorneys and all other expenses connected with the presentation of its own case. SECTION 18. SERVICE OF SUIT This Service of Suit Clause will not be read to conflict with or override the obligations of the parties to mediate or arbitrate their disputes as provided for in any Mediation/Arbitration provision within this Policy. This Clause is intended as an aid to compelling mediation/arbitration or enforcing such arbitration or arbitral award, not as an alternative to such Mediation/Arbitration provision for resolving disputes arising out of this contract of insurance. It is agreed that in the event of the failure of the Insurer hereon to pay any amount claimed to be due hereunder, the Insurer hereon, at the request of the Insured, will submit to the jurisdiction of a Court of competent jurisdiction within the United States. Nothing in this Clause constitutes or should be understood to constitute a waiver of the Insurer’s rights to commence an action in any Court of competent jurisdiction in the United States, to remove an action to a United States District Court, or to seek a transfer of a case to another Court as permitted by the laws of the United States or of any State in the United States. It is further agreed that service of process in such suit may be made upon: Lloyd’s America, Inc Attention: Legal Department 280 Park Avenue, East Tower, 25th Floor New York, NY 10017 and that in any suit instituted against any one of them upon this contract, the Insurer will abide by the final decision of such Court or of any Appellate Court in the event of an appeal. The above-named are authorized and directed to accept service of process on behalf of the Insurer in any such suit and/or upon the request of the Insured to give a written undertaking to the Insured that they will enter a general appearance upon the Insurer behalf in the event such a suit shall be instituted. Further, pursuant to any statute of any state, territory or district of the United States which makes provision therefor, the Insurer hereon hereby designate the Superintendent, Commissioner or Director of Insurance, Secretary of State or other officer specified for that purpose in the statute, or his successor or successors in office, as their true and lawful attorney upon whom may be served any lawful process in any action, suit or proceeding instituted by or on behalf of the Insured or any beneficiary hereunder arising out of this contract of insurance, and hereby designate the above-named as the person to whom the said officer is authorized to mail such process or a true copy thereof. DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 Archer Contingent Energy Risk, LLC on behalf of various Lloyd’s Syndicates 4000 W 114th St, Suite 190 Leawood KS 66211 Page 16 of 18 SECTION 19. OTHER INSURANCE If there is any other insurance payable to the Insured that covers the losses that are covered under this Policy, whether prior to, subsequent to, or simultaneous with this insurance and by whomsoever effected, which, in the absence of this insurance, would cover the losses covered under this Policy, whether the Insured can collect or not, then the Insurer shall pay its share of the covered loss in the proportion that any other applicable limit bears to all of the other limits of insurance that cover the same basis; provided however that in no event will the Insurer’s liability exceed any of the limits set forth in this Policy. SECTION 20. NO THIRD-PARTY LIABILITY OR BENEFICIARIES This Policy is being issued solely for the benefit of the Insured. No other person or entity shall have any rights or benefits under this Policy, nor shall any such person or entity have the right to enforce any of its provisions against the Insurer. SECTION 21. REGULATORY NOTICES THIS INSURANCE CONTRACT IS WITH AN INSURER NOT LICENSED TO TRANSACT INSURANCE IN THIS STATE AND IS ISSUED AND DELIVERED AS SURPLUS LINE COVERAGE UNDER THE TEXAS INSURANCE STATUTES. THE TEXAS DEPARTMENT OF INSURANCE DOES NOT AUDIT THE FINANCES OR REVIEW THE SOLVENCY OF THE SURPLUS LINES INSURER PROVIDING THIS COVERAGE, AND THE INSURER IS NOT A MEMBER OF THE PROPERTY AND CASUALTY INSURANCE GUARANTY ASSOCIATION CREATED UNDER CHAPTER 462, INSURANCE CODE. CHAPTER 225, INSURANCE CODE REQUIRES PAYMENT OF A 4.85 PERCENT TAX ON GROSS PREMIUM. IN WITNESS WHEREOF, the Insurer has caused this Policy to be executed and attested, and, if required by state law, this Policy shall not be valid unless countersigned by a duly authorized representative of the Insurer. ATTEST: ____________________________________________________ __________________ ARCHER CONTINGENT ENERGY RISK, LLC DATE 1/19/2023 DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 Archer Contingent Energy Risk, LLC on behalf of various Lloyd’s Syndicates 4000 W 114th St, Suite 190 Leawood KS 66211 Page 17 of 18 EXHIBIT A Covered Unit Capacity Insured Capacity Denton Energy Center Unit #1 18.75 MW 18.75 MW Denton Energy Center Unit #2 18.75 MW 18.75 MW Denton Energy Center Unit #3 18.75 MW 18.75 MW Denton Energy Center Unit #4 18.75 MW 18.75 MW Denton Energy Center Unit #5 18.75 MW 18.75 MW Denton Energy Center Unit #6 18.75 MW 18.75 MW Denton Energy Center Unit #7 18.75 MW 18.75 MW Denton Energy Center Unit #8 18.75 MW 18.75 MW Denton Energy Center Unit #9 18.75 MW 18.75 MW Denton Energy Center Unit #10 18.75 MW 18.75 MW Denton Energy Center Unit #11 18.75 MW 18.75 MW Denton Energy Center Unit #12 18.75 MW 18.75 MW DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 Archer Contingent Energy Risk, LLC on behalf of various Lloyd’s Syndicates 4000 W 114th St, Suite 190 Leawood KS 66211 Page 18 of 18 EXHIBIT B PROOF OF LOSS 1. Covered Units experiencing Unplanned Event(s): 2. Date(s) and time(s) of Unplanned Event(s): 3. Cause of Unplanned Event(s): 4. Claimed amount of Outage Losses: $_____________________ 5. Attach documentation of Outage Losses. (Evidence to support the submitted claim that every Delivery Interval the Covered Unit was subject to the Unplanned Event and that the Covered Unit(s) would have operated at the capacity that the Insured is claiming reimbursement for in this Proof of Loss. This can be in the form of, but not limited to, invoices, ISO billing documents, distributed control system report(s) or other plant operator performance reports, revenue meter indications, and/or proof of plant/unit dispatch (i.e. effective plant/unit heat rate (Btu/kWh) relative to the market clearing heat rate prior to the forced outage), etc.). WARRANTY: The Insured hereby warrants that the information above in Section 1 through 5 contained in this Proof of Loss is accurate as of the date submitted to the Insurer. DocuSign Envelope ID: E20BF48D-A161-4C94-93B4-5C1B8A021DE9 Certificate Of Completion Envelope Id: E20BF48DA1614C9493B45C1B8A021DE9 Status: Completed Subject: ***Purchasing Approval*** 8163 - DME 2023 Winter Outage Insurance Source Envelope: Document Pages: 20 Signatures: 1 Envelope Originator: Certificate Pages: 2 Initials: 1 Christa Christian AutoNav: Enabled EnvelopeId Stamping: Enabled Time Zone: (UTC-06:00) Central Time (US & Canada) 901B Texas Street Denton, TX 76209 Christa.Christian@cityofdenton.com IP Address: 198.49.140.104 Record Tracking Status: Original 1/19/2023 4:09:47 PM Holder: Christa Christian Christa.Christian@cityofdenton.com Location: DocuSign Signer Events Signature Timestamp Christa Christian christa.christian@cityofdenton.com Senior Buyer City of Denton Security Level: Email, Account Authentication (None) Completed Using IP Address: 198.49.140.104 Sent: 1/19/2023 4:18:47 PM Viewed: 1/19/2023 4:18:58 PM Signed: 1/19/2023 4:19:30 PM Electronic Record and Signature Disclosure: Not Offered via DocuSign Lori Hewell lori.hewell@cityofdenton.com Purchasing Manager City of Denton Security Level: Email, Account Authentication (None) Signature Adoption: Pre-selected Style Using IP Address: 47.188.113.140 Sent: 1/19/2023 4:19:33 PM Viewed: 1/19/2023 5:59:33 PM Signed: 1/19/2023 5:59:43 PM Electronic Record and Signature Disclosure: Not Offered via DocuSign Laura Behrens laura.behrens@cityofdenton.com Assistant Procurement Director City of Denton Security Level: Email, Account Authentication (None) Signature Adoption: Pre-selected Style Using IP Address: 172.58.180.22 Signed using mobile Sent: 1/19/2023 5:59:46 PM Viewed: 1/20/2023 7:20:19 AM Signed: 1/20/2023 7:20:42 AM Electronic Record and Signature Disclosure: Not Offered via DocuSign In Person Signer Events Signature Timestamp Editor Delivery Events Status Timestamp Agent Delivery Events Status Timestamp Intermediary Delivery Events Status Timestamp Certified Delivery Events Status Timestamp Carbon Copy Events Status Timestamp Carbon Copy Events Status Timestamp Cheyenne Defee cheyenne.defee@cityofdenton.com Procurement Administration Supervisor City of Denton Security Level: Email, Account Authentication (None) Sent: 1/20/2023 7:20:45 AM Electronic Record and Signature Disclosure: Not Offered via DocuSign Stephen Johnson Stephen.Johnson@dmepower.com Manager, Energy Mgmt Office City of Denton, DME Security Level: Email, Account Authentication (None) Sent: 1/20/2023 7:20:45 AM Electronic Record and Signature Disclosure: Not Offered via DocuSign Witness Events Signature Timestamp Notary Events Signature Timestamp Envelope Summary Events Status Timestamps Envelope Sent Hashed/Encrypted 1/19/2023 4:18:47 PM Certified Delivered Security Checked 1/20/2023 7:20:19 AM Signing Complete Security Checked 1/20/2023 7:20:42 AM Completed Security Checked 1/20/2023 7:20:45 AM Payment Events Status Timestamps