(2) The public liability referred to in paragraph (c)(1) of this section is public liability which (i) arises out of or in connection with the contractual activity; and (ii) arises out of or results from:

location;

(A) A nuclear incident which takes place at a contract

(B) A nuclear incident which takes place at any other location and arises out of or in the course of the performance of contractual activity under this contract by the Contractor's employees, individual consultants, borrowed personnel or other persons for the consequences of whose acts or omissions the Contractor is liable, provided that such incident is not covered by any other indemnity agreement entered into by ERDA or the NRC pursuant to section 170 of the Act; or

(C) A nuclear incident which arises out of or in the course of transportation of source, special nuclear, or byproduct materials to or from a contract location; provided such incident is not covered by any indemnity agreement entered into by ERDA with the transporting carrier, or with a carrier's organization acting for the transporting carrier, or with a licensee of NRC, pursuant to Section 170 of the Act; or

(D) A nuclear incident which involves items (such as equipment, material, facilities, or design or other data) produced or delivered under this contract, provided such incident is not covered by any other indemnity agreement entered into by ERDA or NRC pursuant to Section 170 of the Act.

(d) In the event of an extraordinary nuclear occurrence which:

(1) Arises out of or results from or occurs in the course of the construction, possession, or operation of a production or utilization facility or

(2) Arises out of or results from or occurs in the course of transportation of source material, byproduct material, or special nuclear material to or from a production or utilization facility, or

(3) During the course of the contract activity arises out of or results from the possession, operation, or use by the contractor or a subcontractor of a device utilizing special nuclear material or byproduct material, ERDA, and the contractor on behalf of itself and other persons indemnified, insofar as their interests appear, each agree to waive:

(A) Any issue or defense as to the conduct of the claimant or fault of persons indemnified, including, but not limited to:

4. unforeseeable intervening causes, whether involving the

conduct of a third person or an act of God.

As used herein, "conduct of the claimant" includes conduct of persons through whom the claimant derives his cause of action;

immunity;

(B) Any issue or defense as to charitable or governmental

(C) Any issue or defense based on any statute of limitations if suit is instituted within 3 years from the date on which the claimant first knew, or reasonably could have known, of his injury or damage and the cause thereof, but in no event more than 10 years after the date of the nuclear incident. The waiver of any such issue or defense shall be effective regardless of whether such issue of defense may otherwise be deemed jurisdictional or relating to an element in the cause of action. The waiver shall be judicially enforceable in accordance with their terms by the claimant against the person indemnified.

(e) The waivers set forth in paragraph (d) of this article: Shall not preclude a defense based upon a failure to take reasonable steps to mitigate damages;

(1)

(2) Shall not apply to injury or damage to a claimant or to a claimant's property which is intentionally sustained by the claimant or which results fron a nuclear incident intentionally and wrongfully caused by the claimant;

(3) Shall not apply to injury to a claimant who is employed at the site of and in connection with the activity where the extraordinary nuclear occurrence takes place if benefits therefor are either payable or required to be provided under any workmen's compensation or occupational disease law;

(4) Shall not apply to any claim for punitive or exemplary damages, provided, with respect to any claim for wrongful death under any State law which provides for damages only punitive in nature, this

exclusion does not apply to the extent that the claimant has sustained actual damages, measured by the pecuniary injuries resulting from such death but not to exceed the maximum amount otherwise recoverable under such law;

(5) Shall not apply to any claim resulting from a nuclear incident occurring outside the United States;

(6) Shall be effective only with respect to those obligations set forth in this agreement and in insurance policies, contracts, or other proof of financial protection;

(7) Shall not apply to, or prejudice the prosecution or defense of any claim or portion of claim which is not within the protection afforded under (i) the limit of liability provisions under subsection 170e of the Atomic Energy Act of 1954, as amended, and (ii) the terms of this agreement and the terms of insurance policies, contracts, or other proof of financial protection

(f) The contractor shall give immediate written notice to ERDA of any known action or claim filed or made against the Contractor or other person indemnified for public liability as defined in paragraphs (2) of section (c). Except as otherwise directed by ERDA, the contractor shall furnish promptly to ERDA copies of all pertinent papers received by the contractor or filed with respect to such actions or claims. When ERDA shall determine that the Government will probably be required to make indemnity payments under the provisions of section (c) above, ERDA shall have the right to, and shall, collaborate with the contractor and any other person indemnified in the settlement or defense of any action or claim and shall have the right (1) to require the prior approval of ERDA for the payment of any claim that ERDA may be required to indemnify hereunder, and (2) to appear through the Attorney General on behalf of the contractor or other person indemnified in any action brought upon any claim that ERDA may be required to indemnify hereunder, take charge of such action, and settle or defend any such action. If the settlement or defense of any such action or claim is undertaken by ERDA, the contractor or other person indemnified shall furnish all reasonable assistance in effecting a settlement or asserting a defense.

(g) The indemnity provided by this article shall not apply to public liability arising out of or in connection with any activity that is performed at a licensed facility, and that is covered by a Nuclear Regulatory Commission indemnity agreement authorized by Section 170 of the Act.

(h) The obligations of ERDA under this article shall not be affected by any failure on the part of the contractor to fulfill

its obligation under this contract, and shall be unaffected by the death, disability, or termination of existence of the contractor to fulfill its obligation under this contract.

(i) The parties to this contract enter into this article upon the condition that this article may be amended at any time by the mutual written agreement of ERDA and the contractor and that such amendment may, by its express terms, provide that it will apply to any nuclear incidents which occur thereafter.

(j) The provisions of this article shall not be limited in any way by, and shall be interpreted without reference to, any other article of this contract [, including Article Dis

contract:

ticle

and Article

Article

putes]: Provided, however, That the following provisions of this Covenant Against Contingent Fees; ArOfficials Not to Benefit; Article Assignment; Examination of Records; and any provisions later added to this contract which under applicable Federal law, including statutes, executive orders and regulations, are required to be included in agreements of the type contained in this article, shall apply to this article.

(k) [The following section will be included in those contracts containing indemnity agreements executed under the general contract authority of ERDA.]

To the extent that the Contractor is compensated by any financial protection, or is indemnified pursuant to this article, or is effectively relieved of public liability by an order or orders limiting same pursuant to section 170e of the Atomic Energy Act of 1954 as amended, the provisions of Article (General Authority Indem

nity) shall not apply.

$9-50.704-7 Nuclear hazards indemnity - product liability.

(a) This article is incorporated into this contract pursuant to the authority contained in section 170d of the Atomic Energy Act of 1954, as amended (hereinafter called the Act).

article.

(1) The definitions set out in the Act shall apply to this

(2) The term "product delivered under the contract" means any material; equipment; device; drawing; specification or technical data made, proposed, or acquired by the contractor in the course of performance of the contract and delivered to ERDA or to any other persons as directed or approved by ERDA.

(b) Except as hereafter permitted or required in writing by

ERDA, the contractor will not be required to provide or maintain, and will not provide or maintain at Government expense, any form of financial protection to cover public liability. ERDA may at any time require in writing that the contractor provide and maintain financial protection of such a type and in such amount as ERDA shall determine to be appropriate to cover public liability against which the contrac= tor is indemnified hereunder: Provided, That the costs of such financial protection will be reimbursed to the contractor by ERDA.

(c) (1) To the extent that the contractor and other persons indemnified are not compensated by any financial protection permitted or required by ERDA or NRC, ERDA will indemnify the contractor, and other persons indemnified, against (i) claims for public liability as described in subparagraph (2) of this paragraph (c); and (ii) the reasonable costs of investigating and settling claims, and defending suits for damages for such public liability, provided that ERDA's liability, excluding such reasonable costs, under all indemnity agreements entered into by ERDA under section 170 of the Act, including this contract, shall not exceed $500 million in the aggregate for each nuclear incident occurring within the United States or $100 million in the aggregate for each nuclear incident occurring outside the United States, irrespective of the number of persons indemnified in connection with this contract.

(2) The public liability referred to in subparagraph (1) of this section is public liability which (i) arises out of or in connection with the contractual activity; and (ii) arises out of or results from a product delivered under the contract; but does not include liability for a nuclear incident which is covered by any other indemnity agreement entered into by ERDA or NRC pursuant to Section 170 of the Act.

(d) The Contractor shall give immediate written notice to ERDA of any known action or claim filed or made against the contractor or other person indemnified for public liability as defined in paragraph (2) of section (c). Except as otherwise directed by ERDA, the con= tractor shall furnish promptly to ERDA copies of all pertinent papers received by the contractor or filed with respect to such actions of claims. When ERDA shall determine that the Government will probably be required to make indemnity payments under the provisions of section (c) above, ERDA shall have the right to, and shall collaborate with the contractor and any other person indemnified in the settlement or defense of any action or claim and shall have the right (1) to require the prior approval of ERDA for the payment of any claim that ERDA may be required to indemnify hereunder, and (2) to appear through the Attorney General on behalf of the contractor or other person indemnified in any action brought upon any claim that ERDA may be required to indemnify hereunder, take charge of such action, and settle