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ARTICLE III TERM SECTION 3.1. EFFECTIVE DATE AND INITIAL TERM .......................................................25 SECTION 3.2. CITY RENEWAL OPTION. .................. ................ ........................ ......... ........25 ARTICLE IV TRANSITION PERIOD SECTION 4.1. COMPANY TRANSITION PERIOD RESPONSIBILITIES ................................. 26 (A) Obligation to Proceed....................................,..................................... 26 (B) Access to Facilities During Transition Period....................................... 27 (C) Notice of Default...,............................................................................. 27 SECTION 4.2. CITY TRANSITION PERIOD RESPONSIBILITIES.................................. ........ 27 SECTION 4.3. COMMENCEMENT DATE CONDITIONS .....................................................28 (A) Commencement Date Conditions Defined............................................ 28 (B) Commencement Date Conditions for which Both Parties Have Responsibility.......,............................................................................. 29 (C) No Payment to Either Party for Transition Period Expenses of the Other ................................................................................................. 29 SECTION 4.4. CLOSING THE TRANSITION PERIOD.......................................................... 29 (A) Establishment of Commencement Date............................................... 29 ARTICLE V TRANSFER OF DESIGNATED EMPLOYEES SECTION 5.1. EMPLOYMENT OF DESIGNATED EMPLOyEES.................... ...................... 31 (A) Employee Orientation...................................... ...................................31 (B) Offer and Employment........................................................................ 31 (C) Wages and Benefits............................................................................ 31 (D) Crediting Years of Service and Accrued Time....................................... 32 SECTION 5.2. INDEMNIFICATION FOR DESIGNATED EMPLOYEE CLAIMS ........................... 32 SECTION 6.1. SECTION 6.2. SECTION 6.3. SECTION 7.1. SECTION 7.2. SECTION 7.3. SECTION 7.4. SECTION 7.5. SECTION 7.6. SECTION 7.7. ARTICLE VI PERMITTING RESPONSIBILITIES COMPANY PERMITTING RESPONSIBILITIES.............................................. 33 CITY PERMITTING RESPONSIBILITIES...................................................... 33 OTHER REPORTING REQUIREMENTS....................................................... 33 ARTICLE VII MANAGEMENT AND OPERATION OWNERSHIP AND USE OF THE FACILITIES............................................... 34 (A) City Ownership...... ............................................................................ 34 (B) Use. . . .. .. .. . . .. .. . . . .. .. . . . . . . .. . .. .. .. . . . . . . . .. . .. . ... . .. . . . . .. .. .. . .. . . . . . . . .. . . . . . . . . . . . . . . . . . . .. . . 34 (C) Use of Facilities Property.................................................................... 34 (D) City Access to Facilities............................................. .........................34 (E) Liens and Encumbrances........... ........................................................35 (F) Company Prohibitions........................................................................ 35 (G) Third-Party Access............................................................................. 35 ACCESS AND USE..................................................................................... 35 CITY'S RIGHTS WITH RESPECT TO BENEFICIAL RE-USE OF EFFLUENT... 35 OWNERSHIP OF FACILITIES EQUIPMENT .................................................36 COMPANY OBLIGATIONS GENERALLy...................................................... 36 (A) Management Responsibility ................................................................ 36 (B) Transfer and Application of Industry Experience .................................36 CITY OBLIGATIONS GENERALLy......... ......... .............................................36 FACILITIES CONDITION CONFIRMATION .................................................. 37 (A) Familiarity with Facilities.................................................................... 37 (C) Limitations on the Company's Assumption of "As- Is" Risk................... 38 (ii)