(CC)- "waste": any solid, liquid or gaseous waste material resulting from the chemical processing in the Plant of irradiated reactor material, including but not limited to source material, special nuclear material and byproduct material.

ARTICLE II. STATEMENT OF WORK

A. The Commission agrees to deliver to the Contractor for chemical processing, and the Contractor agrees to furnish all labor, services, materials, supplies, tools, utilities, machinery and equipment, and shall perform all work necessary to chemically process the following:

(1) An amount of specification material equivalent to approximately 625, but not less than 622 nor more than 650 revenue units; and

(2) the amount of specification material, for which specification material the Commission has determined that the Contractor's charges are reasonable, irradiated in non-Government owned nuclear reactors operated by persons licensed by the Commission, which is delivered to the Commission for financial settlement prior to January 1, 1966 in accordance with the policies expressed in the Federal Register Notice of March 12, 1957 (22 F.R. 1591), as amended, minus the amount of such material with respect to which the Commission and the operators of nuclear reactors agree, in accordance with the Commission's standard policies, that arrangements for chemical processing will be made by such nuclear reactor operators, provided that in no event shall the Commission be obligated to deliver for chemical processing under this Article II A (2) an amount of specification material equivalent to more than the revenue units.

B. The number of revenue units which the Commission shall be obligated to deliver for chemical processing as provided in paragraph A(1) of this Article II shall be reduced, at the option of the Commission, to the extent that the Contractor shall have chemically processed during the term of this contract for all customers (including the Commission) an amount of irradiated reactor material in excess of 1,500 revenue units, except as otherwise provided below. The number of revenue units chemically processed by the Contractor shall be determined as follows:

(1) The number of revenue units of specification material chemically processed for the Commission shall be determined in accordance with the formulae set forth in the definition of revenue unit.

(2) The amount of irradiated reactor material chemically processed for other customers of the Contractor, the turnaround charges related thereto, idle Plant time charges and charges for special services (for the Commission and others) shall be converted into revenue units in accordance with a formula to be mutually agreed upon.

(3) For any processing year in respect of which an adjustment in charges is made as provided in Article XXVI, the number of revenue units chemically processed during such year, determined as provided in (1) and (2) above, shall be adjusted, for the purposes of this Article II, as follows:

(a) If the number of revenue units is in excess of 300 but not in excess of 350, the number of revenue units chemically processed in such processing year shall be deemed to be 300 plus 10% of the excess over 300;

(b) If the number of revenue units is in excess of 350, the number of revenue units chemically processed in such year shall be deemed to be 305 plus 90% of the excess over 350.

If the Contractor shall have chemically processed any small load (as defined in Article XI) as a separate processing lot or if the Contractor combines small loads into a processing lot containing less than 8 processing units, the 1500 revenue unit base referred to in the first sentence of this Article II B shall be increased by a number equivalent to the difference between (i) the number of revenue units represented by such processing lot if determined in accordance with the formula set forth in paragraph (V) of Article I and (ii) the number of revenue units represented by such processing lot if determined in accordance with the formula set forth in paragraph H, Article XI; provided, however, that to the extent that the 1500 revenue units base is increased as provided in this paragraph, it shall be decreased if the Contractor combines any small load into a processing lot containing a total of 8 or more processing units by a number equal to (i) the difference between the total number of revenue units represented by such combined processing lot for which the Contractor has been paid, computed by adding the number of revenue units represented by each component thereof, minus (ii) the number of revenue units represented by such combined processing lot if determined in accordance with paragraph (V) of Article I.

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C. The Contractor shall separate and recover the recoverable uranium and plutonium contained in specification material delivered to it hereunder in the form of recovered product.

D. The Contractor shall receive, unload and store at the Plant, as provided herein, all specification material delivered by the Commission in accordance with the provisions of this contract, and shall perform all other duties and obligations hereinafter expressly set forth, including but not limited to routine decontamination and repair of Commission-furnished containers, reshipment of Commission-furnished containers used to deliver material, measurements, chemical and isotopic analyses, furnishing of data and reports, delivery of recovered product, and provision for storage, disposal and perpetual maintenance of waste. E. The Contractor shall, in addition to its other obligations hereunder, provide a chemical processing service for persons licensed by the Commission, and others, in accordance with the provisions of Article XIII.

F. The services, or any part thereof, provided for under this Article II may be subcontracted by the Contractor only with the prior written consent of the Contracting Officer and upon such conditions as the Contracting Officer may impose. This Article II F shall not apply to any subcontract for standard commercial products, equipment or supplies.

ARTICE III. EXCHANGE OF

A. Exchange of information

INFORMATION;

STORAGE

DELIVERY SCHEDULE, DELIVERY;

As soon as practicable after the effective date of this contract, the Commission and the Contractor will establish a plan for keeping the Contractor currently and fully informed as to the projected amounts of specification material to be made available by the Commission for chemical processing under this contract, the schedules for delivery of material to the Contractor, and such other matters as may be reasonably required to permit the efficient scheduling of the chemical processing provided for herein. Pursuant to such plan the parties hereto will keep each other fully and currently informed with respect to all matters relating to the proposed chemical processing of the Commission's material hereunder so as to permit the parties the greatest practicable degree of flexibility, consistent with the provisions of this contract, in carrying out their respective duties and obligations hereunder. Such plans shall provide that the Commission will advise the Contractor in writing, approximately 90 days prior to the commencement of each processing year, or approximately 90 days prior to January 1, 1965, if this date occurs prior to commencement of the first processing year, of the amount of material which the Commission tentatively proposes to deliver to the Contractor in the ensuing processing year, (or in calendar year 1965) a description of such material by Material Category and the tentative delivery schedule with respect to such material.

B. Delivery schedule; delivery

(1) Not later than thirty (30) days prior to the commencement of each processing year, or thirty (30) days prior to January 1, 1965, the parties hereto will establish a mutually acceptable shipping schedule with respect to all irradiated reactor material to be delivered by the Commission to the Contractor in the ensuing processing year (or in calendar year 1965). All irradiated reactor material to be delivered to the Contractor during the ensuing processing year, or in calendar year 1965, shall be shipped in accordance with such schedule, provided that the Commission may unilaterally amend this shipping schedule with respect to any particular shipment at any time up to 7 days before the scheduled shipping date. The Commission will notify the Contractor promptly upon shipment of material, such notice to include the estimated date of arrival at the Plant. Subject to the limitations contained in paragraph C of this Article III, the Commission may deliver any amount of specification material in any processing year, or in calendar year 1965, irrespective of the amount of specification material scheduled to be chemically processed during such year.

(2) All specification material delivered to the Contractor hereunder shall be delivered by the Commission f.o.b. the Plant in containers furnished by the Commission, which containers shall meet the requirements set forth in Article X hereof. The Contractor shall have the right to refuse to accept delivery of irradiated reactor material in containers which do not meet such requirements.

O. Receipt, unloading and storage

(1) The Contractor shall receive, unload and store at the Plant all specification material delivered by the Commission in accordance with the provisions of this contract. The Contractor agrees to make available to the Commission, on and after January 1, 1965, and at all times thereafter during the term of this contract, not less than 355 storage slots (as described in the Contractor's application to the Commission for a construction permit for the Plant) for storage of the Commission's specification material referred to in Article IIA (1) which is delivered hereunder. The Contractor shall not be obligated to receive, unload or store any material referred to in Article IIA (1) which is delivered by the Commission if such 355 slots are filled at the time of delivery with irradiated reactor material referred to in Article IIA (1). All material referred to in Article IIA (2) shall be received, unloaded and stored without regard to the aforesaid limitation. To the extent that the Contractor does not chemically process an amount of specification material referred to in Article IIA (1) equivalent to 125 revenue units per processing year, cumulatively, it shall provide without charge additional storage for an amount of specification material represented by the difference between (i) the amount of specification material which is equivalent to 125 revenue units per processing year, cumulatively, and (ii) the amount of specification material actually chemically processed. Such additional storage space shall be provided to the extent the Contractor shall not have chemically processed a number of revenue units equivalent to that material for which such additional storage space has been provided.

(2) The Commission may direct the Contractor to store fuel delivered by Commission licensees and others in the storage space available to the Commission. Such storage by the Contractor shall be performed without charge and under such other terms and conditions as may be agreed to by the Contractor and such other party.

ARTICLE IV. AMOUNT OF MATERIAL TO BE PROCESSED IN EACH PROCESSING YEAR; DESIGNATION OF PROCESSING LOT; PROCESSING; DELIVERY OF RECOVERED PRODUCT A. Request by contractor for amount of specification material to be processed (1) At least 60 days prior to the beginning of each processing year, the Contractor shall notify the Commission, in writing, of the amount of specification material, expressed as a number of revenue units, which the Contractor requires from the Commission for chemical processing during the ensuing processing year. No later than 30 days prior to the beginning of each processing year the Commission shall designate to the Contractor and commit to chemical processing, a processing lot or lots which will result in the number of revenue units (±15% of the number of revenue units, or ±10 revenue units, whichever is smaller) set forth in the Contractor's notification.

(2) No later than 120 days after the commencement of each processing year, the Contractor will review its chemical processing schedule and shall notify the Commission, in writing, of the additional amount of specification material, expressed as a number of revenue units, which the Contractor requires from the Commission for the remainder of the processing year. No later than 150 days from the beginning of such current processing year, the Commission shall designate to the Contractor and commit to chemical processing a processing lot or lots which will result in the number of revenue units (±15% of the number of revenue units, or ±10 revenue units, whichever is smaller) set forth in the Contractor's notification.

(3) The Commission agrees that it will not designate for chemical processing any specification material in Material Categories 3, 5, 6, 7, or 8 until the tanks for the storage of the waste generated by the chemical processing of such material have been constructed and installed, or should have been constructed and installed as provided in Article VI, whichever is earlier, provided that if the Contractor fails to construct and install the tanks within the time periods provided in Article VI, the Commission, as its sole remedy, shall be relieved, until such construction and installation have been completed, of its obligation to designate a number of revenue units as requested by the Contractor equivalent to that number set forth in the Commission's notification to the Contractor referred to in Article VI A (2) and (3).

B. Designation of processing lot

(1) The size and content of any processing lot designated by the Commission for chemical processing hereunder shall be determined by the Commission. The designation of a processing lot shall be in writing, shall clearly identify the material so designated (by delivery of a Specific Material Description in the form set forth in Table 3 of Appendix A) and shall constitute full authority to the Contractor (i) to proceed with the chemical processing of the material designated pursuant to paragraph A. (1) above at any time on or after the first day of the ensuing processing year, and (ii) to proceed with the chemical processing of the material designated pursuant to paragraph A.(2) above at any time after 30 days following designation of such additional material by the Commission. Unless the material so designated for chemical processing shall have been delivered to the Contractor at the time of such designation, the Commission will deliver such material in time to permit the commencement of chemical processing on the Contractor's scheduled date and the chemical processing of the entire processing lot without interruption.

(2) The Commission shall have the right to include in one processing lot any specification material referred to in Article II A(1) and II A(2), provided that all such material belongs to the same Material Category.

(3) If, in order to comply with the Contractor's processing requirements under paragraph A of this Article IV, the Commission determines that (i) it must designate a processing lot with respect to which W/P, as defined in Article VI, is less than 24, and the Commission has actually accumulated or reasonably could be expected to accumulate, during the term of this contract sufficient specification material of the same Material Category to designate a processing lot with respect to which W/P is 24 or more, and/or (ii) the remaining amount of specification material in the same Material Category actually accumulated, or which the Commission could reasonably be expected to accumulate, during the term of this contract, after designation of a processing lot as requested by the Contractor, does not enable the Commission to designate a processing lot with respect to which W/P is 24 or more, then the charge to the Commission under Article VI for any processing lot in this Material Category with respect to which W/P is less than 24 shall be computed as if W/P were 24 or more; provided, however, that if either occurrence contemplated should be likely, the Commission shall inform the Contractor of this fact in writing prior to making the Commission's designation in reply to the Contractor's notification, and the Commission shall afford the Contractor an opportunity to amend its notification and, should the Commission make its designation without so informing the Contractor, it shall, for the purposes of this contract, be conclusively presumed that neither occurrence contemplated will take or has taken place; provided further, that this paragraph shall not apply in any case in which the Contractor has requested the Commission to designate for chemical processing specification material equivalent to 125 revenue units.

If, after a settlement of charges on the basis of clause (i) of subparagraph B(3) above, the amount of specification material in a Material Category actually accumulated during the term of this contract by the Commission is not sufficient to enable the Commission to designate a processing lot with respect to which W/P is 24 or more, such clause shall not apply, and amounts due the Contractor shall be properly adjusted. If, after a settlement of charges on the basis of clause (ii) of subparagraph B(3) above, the amount of specification material in a Material Category actually accumulated by the Commission during the term of this contract is sufficient to enable the Commission to designate a processing lot with respect to which W/P is 24 or more, such clause shall not apply and amounts due the Contractor shall be properly adjusted. (4) If, in. order to comply with the Contractors processing requirements under paragraph A. of this Article IV, the Commission determines that it must, and actually does, designate a processing lot with respect to which W/P is less than 24, and if the amount of specifications material in the same Material Category which accumulations thereafter does not equal such amount as would have enabled the Commission to designate a total processing lot (including the processing lot initially designated) with respect to which W/P is 24 or more, and (i) if the Commission thereafter designates the amount of material remaining after the initial designation of a processing lot as a separate processing lot, and/or (ii) if the Commission thereafter designates the amount of material which accumulates as a separate processing lot, the charges payable

by the Commission for chemically processing such separate processing lot or processing lots, together with the charges for chemically processing the processing lot initially designated, shall not exceed the charges which would have been payable had both the initial and subsequent processing lots been chemically processed as a single processing lot.

C. Amount of material to be chemically processed by Contractor during each processing year.

Unless otherwise authorized in advance by the Contracting Officer:

(1) The Contractor shall deliver all recovered product resulting from chemical processing of all specification material requested pursuant to paragraphs A. (1) and (2) of this Article IV within 12 months from the respective first day on which the Contractor is authorized (as provided in paragraph B (1) above) to proceed with the chemical processing of the material requested;

(2) The Contractor shall chemically process the following minimum amounts of specification material:

(i) During the first processing year, an amount of specification material equivalent to not less than 100 revenue units;

(ii) During the first two processing years, an amount of specification material which, including the amount of specification material chemically processed during the first processing year, is equivalent to not less than 280 revenue units;

(iii) During the term of this contract, all of the specification material referred to in Article II A (1) and (2) hereof.

The minimum amount of specification material required to be chemically processed during the first and second processing years shall be reduced to the extent that the amount of material required to be delivered by the Commission pursuant to Article II A (2) hereof is reduced as provided therein; provided, however, that in no event shall the Contractor be obligated to chemically process an amount of specification material which is equivalent to less than 60 revenue units in each of the first two processing years.

D. Minimum and maximum amounts of material to be requested by contractor Unless otherwise authorized in advance by the Contracting Officer :

(1) The Contractor shall in all cases request such amounts of specification material as shall enable the Contractor to meet the minimum demand chemical processing requirements set forth in paragraph C of this Article IV.

(2) The Contractor may not request in any one processing year an amount of specification material which would require the Commission to designate a quantity of specification material referred to in Article II A (1) hereof equivalent to more than 125 revenue units, except to the extent that the Contractor has not requested, in any one or more processing years, an amount of specification material referred to in Article II A (1) which is equivalent to 125 revenue units in such year or years, the Contractor may request in any subsequent processing year or years an additional amount equal to the cumulative total of the amount or amounts not so requested.

E. Substitution of material; change of size of processing lot

Without increasing or decreasing the size of a processing lot by more than 5% of the number of revenue units represented by such processing lot:

(1) The Commission at any time up to 15 days prior to the commencement by the Contractor of chemical processing of a processing lot, may amend a processing lot by substituting for all or part of such processing lot specification material in the same Material Category as that contained in the processing lot; or

(2) The Commission, at any time up to 30 days prior to the commencement by the Contractor of chemical processing of a processing lot, may amend a processing lot by substituting for the entire processing lot specification material of a different Material Category.

F. Chemical processing of a processing lot

The Contractor shall use its best efforts to notify the Commission at least 30 days, and in any event shall notify the Commission no less than 72 hours, in advance of the date upon which it commences the initial mechanical or chemical treatment of each processing lot. Notwithstanding such notice, the Contractor shall not be obligated to commence the initial mechanical or chemical treatment on the date specified in such notice. The Contractor shall keep records of the initial date of commencement of mechanical or chemical treatment of each processing lot. The Contractor may perform the mechanical and chemical treatment