BOD Agenda Packet for May 18, 2022 — Ava Community Energy Board of Directors, May 18, 2022 (part 1 of 3)

Board of Directors Meeting
Wednesday, May 18, 2022
5:00pm
https://us02web.zoom.us/j/87023071843
Dial(for higher quality, dial a number based on your current location): US: +1 669 900 6833 or +1 346 248 7799 or +1 253 215 8782 or +1 929 205 6099 or +1 301 715 8592 or 888 475 4499 (Toll Free) or 877 853 5257 (Toll Free)
Webinar ID: 870 2307 1843
Meetings are accessible to people with disabilities. Individuals who need special assistance or a disability-related modification or accommodation to participate in this meeting, or who have a disability and wish to request an alternative format for the meeting materials, should contact the Clerk of the Board at least 2 working days before the meeting at (510) 906-0491 or [email protected].

If you have anything that you wish to be distributed to the Board of Directors, please email it to the clerk by 5:00 pm the day prior to the meeting.

1. Welcome & Roll Call

2. Pledge of Allegiance

3. Public Comment
This item is reserved for persons wishing to address the Board on any EBCE-related matters that are not otherwise on this meeting agenda. Public comments on matters listed on the agenda shall be heard at the time the matter is called. As with all public comment, members of the public who wish to address the Board are customarily limited to two minutes per speaker and must complete an electronic speaker slip. The Board Chair may increase or decrease the time allotted to each speaker.

4. Closed Session
a) Conference with Labor Negotiations pursuant to Government Code 54957.6. (Labor negotiators: Dianne Martinez, Board Chair; Corina Lopez, Executive Committee Chair) (Unrepresented employees)

5. General Counsel Report Out of Closed Session

CONSENT AGENDA

6. Approval of Minutes from April 7, 2022 and April 20, 2022 East Bay Community Energy
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7. AB 361 - Finding for Continued Remote Meetings
Find that conducting in person meetings of the Board would present imminent risks to attendees’ health and authorize the Board to continue meeting via teleconferencing pursuant to Government Code Section 54953(e).

8. Contracts entered into (Informational Item)

9. Amendment to Rate setting protocol (Action Item)
Present proposed amendment to rate setting protocol

10.Amendment to Procurement Policy (Action Item)
Present proposed Amendments to clarify parts of Procurement Policy

REGULAR AGENDA

11.CEO REPORT

12.Community Advisory Committee Report

13. Legislative Update (Action Item)
Update on recommended bill positions and EBCE’s bill tracker

14.FY 2022-2023 Budget (Informational Item)
Present draft FY 2022-2023 Budget

15. Energy Prepay Transaction #2 Approval (Action Item) Seek approval to enter into a 2nd energy prepay transaction

16. Board Member and Staff Announcements including requests to place items on future Board Agendas

17.Adjournment to Wednesday, June 15, 2022 at 5:00pm
Consent Item 6A
Draft Agenda
Board of Directors Special Meeting
Wednesday, April 7, 2022
10:00 am
https://us02web.zoom.us/j/87023071843
Dial(for higher quality, dial a number based on your current location): US: +1 669 900 6833 or +1 346 248 7799 or +1 253 215 8782 or +1 929 205 6099 or +1 301 715 8592 or 888 475 4499 (Toll Free) or 877 853 5257 (Toll Free)
Webinar ID: 870 2307 1843
Meetings are accessible to people with disabilities. Individuals who need special assistance or a disability-related modification or accommodation to participate in this meeting, or who have a disability and wish to request an alternative format for the meeting materials, should contact the Clerk of the Board at least 2 working days before the meeting at (510) 906-0491 or [email protected].

If you have anything that you wish to be distributed to the Board, please email it to the clerk by 5:00 pm the day prior to the meeting.

1. Welcome & Roll Call

Present: Directors: Valle (Alameda County), Tiedemann (Albany), Kumagai (Dublin), Marquez (Hayward), Munro (Livermore), Hannon (Newark), Kalb (Oakland), Cavenaugh (Piedmont), Narum (Pleasanton), Patino (Union City), Vice-Chair Lopez (San Leandro) and Chair Martinez (Emeryville)
Excused: Directors: Harrison (Berkeley), Cox (Fremont), Arriola (Tracy), Eldred (CAC)

2. Public Comment
This item is reserved for persons wishing to address the Board on any EBCE-related matters that are not otherwise on this meeting agenda. Public comments on matters listed on the agenda shall be heard at the time the matter is called. As with all public comment, members of the public who wish to address the Board are customarily limited to two minutes per speaker and must complete an electronic speaker slip. The Board Chair may increase or decrease the time allotted to each speaker.

There were no speakers for public comment.

East Bay Community Energy
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Consent Item 6A

REGULAR AGENDA

3. Closed Session
a) Conference with Labor Negotiations pursuant to Government Code 54957.6 (Labor negotiators: Dianne Martinez, Board Chair; Corina Lopez, Executive Committee Chair) (Unrepresented employees)

4. General Counsel Report Out of Closed Session
No reportable actions were taken in closed session.

5. Board Member and Staff Announcements including requests to place items on future Board Agendas
There were no announcements or future Board agenda item requests.

6. Adjournment to Wednesday, April 20, 2022 at 5pm.

Consent Item 6B
Draft Agenda
Board of Directors Meeting
Wednesday, April 20, 2022
5:00 pm
https://us02web.zoom.us/j/87023071843
Dial(for higher quality, dial a number based on your current location): US: +1 669 900 6833 or +1 346 248 7799 or +1 253 215 8782 or +1 929 205 6099 or +1 301 715 8592 or 888 475 4499 (Toll Free) or 877 853 5257 (Toll Free)
Webinar ID: 870 2307 1843
Meetings are accessible to people with disabilities. Individuals who need special assistance or a disability-related modification or accommodation to participate in this meeting, or who have a disability and wish to request an alternative format for the meeting materials, should contact the Clerk of the Board at least 2 working days before the meeting at (510) 906-0491 or [email protected].

If you have anything that you wish to be distributed to the Board, please email it to the clerk by 5:00 pm the day prior to the meeting.

1. Welcome & Roll Call

Present: Directors: Tiedemann (Albany), Harrison (Berkeley), Kumagai (Dublin), Cox (Fremont), Marquez (Hayward), Munro (Livermore), Hannon (Newark), Kalb (Oakland), Cavenaugh (Piedmont), Arriola (Tracy), Patino (Union City), Vice-Chair Lopez (San Leandro) and Chair Martinez (Emeryville)
Excused: Directors: Valle (Alameda County), Narum (Pleasanton), Patino (Union City) Director Harrison (Berkeley) joined the meeting at 5:07pm.

Director Kumagai (Dublin) left the meeting before 7:30pm.

Director Harrison (Berkeley) left the meeting before 8:00pm.

Director Hannon (Newark) left the meeting before 8:00pm.

2. Pledge of Allegiance

East Bay Community Energy
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Consent Item 6B
Jessica Tovar, on behalf of East Bay Clean Power Alliance, spoke regarding four Transformative Climate Communities Grants, one of which is for $35 million dollars, which could be used toward community-based micro-grids, decarbonization upgrades, and electrification upgrades, but it is just one of many examples of potential state and federal money outside EBCE’s funds that EBCE could apply for and regrant to community groups in EBCE territory. Jessica Tovar announced that Dave McCord from the Sierra Club and who was active in advocating for EBCE had passed away.

Chair Martinez indicated that Item 16 – Board Member and Staff Announcements, would be heard after the Consent Agenda.

4. Closed Session
a) Conference with Labor Negotiations pursuant to Government Code 54957.6 (Labor negotiators: Dianne Martinez, Board Chair; Corina Lopez, Executive Committee Chair) (Unrepresented employees)

5. General Counsel Report Out of Closed Session
No reportable actions were taken in closed session.

Board Clerk Bankhead indicated that Directors Tiedemann (Albany) and Kalb (Oakland) were present at the meeting, although not reflected in the roll call.

CONSENT AGENDA

6. Approval of Minutes from March 16, 2022

7. AB 361 – Finding for Continued Remote Meetings
Find that conducting in person meetings of the Board would present imminent risks to attendees’ health and authorize the Board to continue meeting via teleconferencing pursuant to Government Code Section 54953(e).

8. Contracts entered into (Informational Item)

9. Treasurer’s Report (Informational Item)
Report on cash balances.

10. 2021 Supplier Diversity Report Overview (Informational Item) Overview of 2021 Supplier Diversity Report to CPUC

11.Amendment to CSA with Acterra (Action Item)
Amend existing CSA with Acterra to correct errors in the CSA and add budget for local procurement of cooktops
Tom Kelly pointed out that the Consent Calendar includes financial reports, but other committees have seen more extensive reports. Tom Kelly did not believe the Board could East Bay Community Energy
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Consent Item 6B
adequately analyze issues like Agenda Item 17, Renewables Procurement, without actually seeing a more in depth report on the agency’s financial status.

Director Hannon (Newark) motioned to approve the Consent Agenda. Director Cox (Fremont) seconded the motion, which passed 11/0. Excused: Valle (Alameda County), Narum (Pleasanton), Patino (Union City)

REGULAR AGENDA

17. Renewables Procurement (Action Item)
Adopt a schedule with annual power procurement goals for renewable and carbon-free electricity purchases as a path to reach zero emission electricity by 2030.

Tom Kelly stated this is not a plan to get to 100% renewable by 2030; it is a plan to get to 60% renewable by 2030 and 100% carbon free. Tom Kelly noted that in 2019 EBCE’s Bright Choice had already 60% renewable content, but it would take another eight years to get to that point if the Board approves this plan. Tom Kelly took exception to CEO Chaset’s contention that this is something that can be changed in the future and stated the Board is giving the agency a plan that will lock them into some decisions that would be different if the Board rejected this plan and instituted something more aggressive. Tom Kelly noted that a number of CCAs are at 100% renewable already, with PCE promising to get to 100% carbon free by 2025, and add that the IRP is really a document required by the CPUC to ensure the agency will be able to deliver electricity to its customers, but does not constrain EBCE from taking a more aggressive approach to reducing carbon emissions.

Chris Gilbert stated something missing from the presentation is any reference to other CCAs, utilities, etc., to see how they are doing, but it is important to measure EBCE’s progress against how others are doing, and while increasing renewable and decreasing emissions is reasonable, is it the best way? Chris Gilbert stated that Tom Kelly’s letter shows that EBCE is off the chart for emissions compared to other CCAs, and asked if that would be changed with this plan? Chris Gilbert urged the Board to look at others in the field and not just rely on internal projections.

Jim Lutz stated the presentation is about the Bright Choice mix, but EBCE has several cities opting up to make the renewable 100 their default. Jim Lutz asked what fraction of EBCE’s total sales are Bright Choice now and how it is going to be changing with the different jurisdictions changing their defaults?
Jessica Tovar, on behalf of East Bay Clean Power Alliance, stated that in 2016 when they advocated for the East Bay Community Choice program one thing that came up was a huge emphasis on not using the unbundled RECs, what is referred to as the PCC-3 in the document, and they didn’t want it because the RECs enable certain types of un clean energy to be sold and used as if it is. Jessica Tovar added that another thing they also emphasize is a strong commitment to not including nuclear energy. Jessica Tovar highlighted that forms of incineration are considered renewable in California, which is problematic with respect to environmental justice.

CAC Chair Eldred reported:

East Bay Community Energy
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Consent Item 6B
• Technically CAC voted to support the Renewables Procurement schedule, but that vote was 4 yes, 2 no, 3 abstentions, and 3 absences, so it did not pass with a majority. • The presentation lacks important details on items CAC cares about, and CAC wished to see additional detail with respect to work force, risk, and local development. • The vagueness of the presentation and the lack of detail in how this would affect EBCE constituencies in each community was evident in the inability to get strong support for a plan to reduce emissions, something CAC would usually be enthusiastic about.

The Board Discussed:
• Concern that the presentation does not show EBCE being at 100% by 2030, and how the presentation numbers weigh in with the demand of the jurisdictions that have opted up and will be opting up to be at 100% renewable by 2030. • What is the path to make Bright Choice more renewable by next year? • Cost to move the 100% renewable goal to 2025, which is the goal of many other CCAs. • Budgeting for new renewable resource creation beyond what is represented in the presentation.
• Are behind the meter resources being explored?
• Is there any benefit to EBCE self-imposing a restriction where they would only do half as much as the state RPS allows for bucket 2 RECs, and would that get EBCE any more carbon free energy?
• Ways to structure PPC-2 transactions such that they carry zero emissions and is priced similar to a PPC-1.
• If EBCE created its Bright Choice product starting at 0.5% discount instead of 1%, would that help speed up the pathway in reducing the amount of dirty energy in the Bright Choice portfolio?
• Pathway to reducing rates more quickly in the next four years, allowing EBCE to take a pause before pushing on another four years to 2030.
• Providing additional savings to low-income residents in this time of skyrocketing electricity rates.
• Priority for EBCE to have cheaper rates than PG&E as EBCE moves into the Central Valley where customers are more concerned about economics than being green.

Director Kumara (Dublin) moved to adopt the schedule with annual power procurement goals for renewable and carbon free electricity purchases, with a path to zero emissions by 2030. Director Lopez (San Leandro) seconded the motion, which passed 12/0.

Excused: Valle (Alameda County), Narum (Pleasanton), Patino (Union City)

12. CEO REPORT

13. Community Advisory Committee Report
• Chair Eldred reported that CAC is interested in agendizing and bringing back to the Board the issue for the Community Innovation Grants.
• Chair Eldred reported that staff had made significant progress on metrics for measuring advances in equity in social, economic, and environmental balance of public projects, and will bring the item to the Board in the future.

14. Prepay Follow-on (Action Item)
Present a follow-on prepay transaction and seek approval to be enabled with consultants to facilitate the transaction.

East Bay Community Energy
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Consent Item 6B
There were no speakers for public comment.

Vice-Chair Lopez (San Leandro) motioned to approve the prepay follow-on. Director Cavenaugh (Piedmont) seconded the motion, which passed 11/0. Excused: Valle (Alameda County), Narum (Pleasanton), Patino (Union City)

15. Legislative Update (Action Item)
Update on recommended bill positions and EBCE’s bill tracker There were no speakers for public comment.

The Board Discussed:
• Backstory on AB 1960, which recommends the Governor consider certain geographic diversity, and potential for supporters try to make it a requirement and slip it through the assembly now.
• CAC urges the Board to take a support position in favor of staff’s recommendations, with the exception of asking the Board to direct staff to change its support position for AB 2765, the Santiago bill, from a support position to a watch position.

Director Munro moved to accept the recommended bill positions with the caveat for AB 1960 that if the bill goes from considering to requirement that the Board or Executive Committee rediscuss the possibility of EBCE no longer supporting it; and with respect to AB 2765, should there be significant changes to the decision it be elevated to the Executive Board. Director Tiedemann seconded the motion, which passed 9/0. Excused:

Valle (Alameda County), Narum (Pleasanton), Patino (Union City)

16.Approval of Default Product Change Requests: Emeryville and Dublin (Action Item) Request Board of Directors approval for City of Emeryville to default residential (non-CARE) plus commercial customers to R100
There were no speakers for public comment.

The Board Discussed:
• Updated enrollment numbers for the cities that have most recently opted back down.

Director Tiedemann moved to approve City of Emeryville to default residential (non-CARE) plus commercial customers to R100. Director Lopez seconded the motion, which passed 9/0. Excused: Valle (Alameda County), Narum (Pleasanton), Patino (Union City)

18. Board Member and Staff Announcements including requests to place items on future Board Agendas
There were no announcements or future agenda item requests.

19.Adjournment to Wednesday, May 18, 2022 at 5:00pm
Consent Item 7
Consent Item 7
TO: East Bay Community Energy Board of Directors
FROM: Inder Khalsa, General Counsel
SUBJECT: Adoption of Imminent Risks Findings Pursuant to AB 361 and Authorization to Continue Meeting via Teleconferencing
DATE: April 20, 2022
__________________________________________________________________ Recommendation
Find that conducting in-person meetings of the Board would present imminent risks to attendees’ health and authorize the Board to continue meeting via teleconferencing pursuant to Government Code Section 54953(e).

Background and Discussion
On March 4, 2020, Governor Gavin Newsom proclaimed a state of emergency related to COVID-19, pursuant to Government Code Section 8625, which is still in effect. On March 10, 2020, the Alameda County Board of Supervisors ratified the County Health Officer’s declaration of a local health emergency due to COVID-19.

The Brown Act allows legislative bodies to meet by “teleconference,” but only if the agenda listed the remote location of each member, the agenda was posted at all remote locations, and the public could access any of the remote locations.

Additionally, a quorum of the legislative body had to be within the legislative body’s jurisdiction. See Government Code Section 54953(b)(3)
Due to the COVID-19 pandemic, the Governor issued Executive Order N-29-20, suspending certain sections of the Brown Act. Pursuant to the Executive Order, legislative bodies no longer needed to list the location of each remote attendee, post agendas at each remote location, or allow the public to access each location. Further, a quorum of the legislative body does not need to be within the legislative body’s Consent Item 7
jurisdiction. After several extensions, Executive Order N-29-20 expired on September 30, 2021.

On September 16, 2021 Governor Newsom signed AB 361, new legislation that amends the Brown Act to allow local agencies to meet remotely during Governor declared emergencies under certain conditions. AB 361 took effect immediately as an urgency measure, but the Governor subsequently suspended application of the legislation ̶ with limited exceptions ̶ until October 1, 2021. The provisions of AB 361 relevant to local agencies are codified at Government Code Section 54953(e).

AB 361 authorizes local agencies to continue meeting remotely without following the Brown Act’s standard teleconferencing provisions if the meeting is held during a state of emergency proclaimed by the Governor and either of the following applies: (1) state or local officials have imposed or recommended measures to promote social distancing; or (2) the agency has already determined or is determining whether, as a result of the emergency, meeting in person would present imminent risks to the health or safety of attendees.

The legislative body must make the required findings every 30 days, until the end of the state of emergency or recommended or required social distancing.

AB 361 also requires legislative bodies to make remote public meetings accessible telephonically or otherwise electronically to all members of the public seeking to observe and to address the local legislative body, and to make reasonable efforts to adhere as closely as reasonably possible to the provisions of the Brown Act. AB 361 adds new procedures and clarifies the requirements for conducting remote meetings.

A legislative body that meets remotely must allow members of the public to access the meeting via a call-in option or an internet-based service option, and the agenda for the remote meeting must provide an opportunity for members of the public to directly address the body in real time.

Due to the rise in COVID-19 cases caused by the Delta Variant, Alameda County is still impacted by the effects of the COVID-19 emergency. The Centers for Disease Control (CDC) recommends physical distancing of at least six (6) feet whenever possible, avoiding crowds, and avoiding spaces that do not offer fresh air from the outdoors, particularly for people who are not fully vaccinated or who are at higher risk of getting very sick from COVID-19. The CDC also recommends that people who live with unvaccinated people avoid activities that make physical distancing hard.

Consent Item 7
EBCE’s public-meetings are held at indoor facilities not designed to ensure circulation of fresh or outdoor air, particularly during periods of cold and/or rainy weather, and were not designed to ensure that attendees can remain six (6) feet apart.

Additionally, holding in-person meetings may encourage community members to come to EBCE facilities to participate in EBCE meetings in-person, and some of them could be at high risk of getting very sick from COVID-19 and/or live with someone who is at high risk. At this point in time, there are few in-person locations available for the EBCE to meet in, since most of the agencies in Alameda County are still holding remote meetings.

In-person meetings could also tempt community members who are experiencing COVID-19 symptoms to leave their homes in order to come to EBCE Board meetings to participate. Attendees may need to use ride-share services and/or public transit to travel to in-person meetings, thereby putting them in close and prolonged contact with additional people outside of their households.

For these reasons, staff recommends that the Board adopt findings that, as a result of the state of emergency caused by COVID-19, meeting in person would present imminent risks to the health and safety of attendees.

Staff will continue to monitor the situation and will return to the Board every 30 days or as needed with additional recommendations related to the conduct of public meetings.

Attachments
• Proclamation of Governor Newson of a State of Emergency due to COVID-19 • Resolution No. R-2020-91 of the Alameda County Board of Supervisors Ratifying the Declaration of a Local Health Emergency due to COVID-19

EXECUTIVE DEPARTMENT

STATE OF CALIFORNIA

PROCLAMATION OF A STATE OF EMERGENCY
WHEREAS in December 2019, an outbreak of respiratory illness due to a novel coronavirus (a disease now known as COVID-19), was first identified in Wuhan City, Hubei Province, China, and has spread outside of China, impacting more than 75 countries, including the United States; and
WHEREAS the State of California has been working in close collaboration with the national Centers for Disease Control and Prevention (CDC), with the United States Health and Human Services Agency, and with local health departments since December 2019 to monitor and plan for the potential spread of COVID-19 to the United States; and WHEREAS on January 23, 2020, the CDC activated its Emergency Response System to provide ongoing support for the response to COVID-19 across the country; and WHEREAS on January 24, 2020, the California Department of Public Health activated its Medical and Health Coordination Center and on March 2, 2020, the Office of Emergency Services activated the State Operations Center to support and guide state and local actions to preserve public health; and
WHEREAS the California Department of Public Health has been in regular communication with hospitals, clinics and other health providers and has provided guidance to health facilities and providers regarding COVID-19; and
WHEREAS as of March 4, 2020, across the globe, there are more than 94,000 confirmed cases of COVID-19, tragically resulting in more than 3,000 deaths worldwide; and
WHEREAS as of March 4, 2020, there are 129 confirmed cases of COVID-19 in the United States, including 53 in California, and more than 9,400 Californians across 49 counties are in home monitoring based on possible travel-based exposure to the virus, and officials expect the number of cases in California, the United States, and worldwide to increase; and
WHEREAS for more than a decade California has had a robust pandemic influenza plan, supported local governments in the development of local plans, and required that state and local plans be regularly updated and exercised; and
WHEREAS California has a strong federal, state and local public health and health care delivery system that has effectively responded to prior events including the Hl N 1 influenza virus in 2009, and most recently Ebola; and
Attachment Consent Item 7A
WHEREAS experts anticipate that while a high percentage of individuals affected by COVID-19 will experience mild flu-like symptoms, some will have more serious symptoms and require hospitalization, particularly individuals who are elderly or already have underlying chronic health conditions; and
WHEREAS it is imperative to prepare for and respond to suspected or confirmed COVID-19 cases in California, to implement measures to mitigate the spread of COVID-19, and to prepare to respond to an increasing number of individuals requiring medical care and hospitalization; and
WHEREAS if COVID-19 spreads in California at a rate comparable to the rate of spread in other countries, the number of persons requiring medical care may exceed locally available resources, and controlling outbreaks minimizes the risk to the public, maintains the health and safety of the people of California, and limits the spread of infection in our communities and within the healthcare delivery system; and WHEREAS personal protective equipment [PPE) is not necessary for use by the general population but appropriate PPE is one of the most effective ways to preserve and protect California's healthcare workforce at this critical time and to prevent the spread of COVID-19 broadly; and WHEREAS state and local health departments must use all available preventative measures to combat the spread of COVID-19, which will require access to services, personnel, equipment, facilities, and other resources, potentially including resources beyond those currently available, to prepare for and respond to any potential cases and the spread of the virus; and
WHEREAS I find that conditions of Government Code section 8558(b), relating to the declaration of a State of Emergency, have been met; and
WHEREAS I find that the conditions caused by COVID-19 are likely to require the combined forces of a mutual aid region or regions to appropriately respond; and
WHEREAS under the provisions of Government Code section 8625(c), I find that local authority is inadequate to cope with the threat posed by COVID-19; and
WHEREAS under the provisions of Government Code section 8571 , I find that strict compliance with various statutes and regulations specified in this order would prevent, hinder, or delay appropriate actions to prevent and mitigate the effects of the COVID-19.

NOW, THEREFORE, I, GAVIN NEWSOM, Governor of the State of California, in accordance with the authority vested in me by the State Constitution and statutes, including the California Emergency Services Act, and in particular, Government Code section 8625, HEREBY PROCLAIM A STATE OF EMERGENCY to exist in California.

Attachment Consent Item 7A
IT IS HEREBY ORDERED THAT:

1. In preparing for and responding to COVID-19, all agencies of the state government use and employ state personnel, equipment, and facilities or perform any and all activities consistent with the direction of the Office of Emergency Services and the State Emergency Plan, as well as the California Department of Public Health and the Emergency Medical Services Authority. Also, all residents are to heed the advice of emergency officials with regard to this emergency in order to protect their safety.

2. As necessary to assist local governments and for the protection of public health, state agencies shall enter into contracts to arrange for the procurement of materials, goods, and services needed to assist in preparing for, containing, responding to, mitigating the effects of, and recovering from the spread of COVID-19. Applicable provisions of the Government Code and the Public Contract Code, including but not limited to travel, advertising, and competitive bidding requirements, are
suspended to the extent necessary to address the effects of COVID-19.

3. Any out-of-state personnel, including, but not limited to, medical personnel, entering California to assist in preparing for, responding to, mitigating the effects of, and recovering from COVID-19 shall be permitted to provide services in the same manner as prescribed in Government Code section 179.5, with respect to licensing and certification. Permission for any such individual rendering service is subject to the approval of the Director of the Emergency Medical Services Authority for medical personnel and the Director of the Office of Emergency Services for non-medical personnel and shall be in effect for a period of time not to exceed the duration of this emergency.

4. The time limitation set forth in Penal Code section 396, subdivision {b), prohibiting price gouging in time of emergency is hereby waived as it relates to emergency supplies and medical supplies.

These price gouging protections shall be in effect through September 4, 2020.

5. Any state-owned properties that the Office of Emergency Services determines are suitable for use to assist in preparing for, responding to, mitigating the effects of, or recovering from COVID-19 shall be made available to the Office of Emergency Services for this purpose, notwithstanding any state or local law that would restrict, delay, or otherwise inhibit such use.

6. Any fairgrounds that the Office of Emergency Services determines are suitable to assist in preparing for, responding to, mitigating the effects of, or recovering from COVID-19 shall be made available to the Office of Emergency Services pursuant to the Emergency Services Act, Government Code section 8589.

The Office of Emergency Services shall notify the fairgrounds of the intended use and can immediately use the fairgrounds without the fairground board of directors' approval, and Attachment Consent Item 7A
notwithstanding any state or local law that would restrict, delay, or otherwise inhibit such use.

7. The 30-day time period in Health and Safety Code section 101080, within which a local governing authority must renew a local health emergency, is hereby waived for the duration of this statewide emergency. Any such local health emergency will remain in effect until each local governing authority terminates its respective local health emergency.

8. The 60-day time period in Government Code section 8630, within which local government authorities must renew a local
emergency, is hereby waived for the duration of this statewide emergency. Any local emergency proclaimed will remain in effect until each local governing authority terminates its respective local emergency.

9. The Office of Emergency Services shall provide assistance to local governments that have demonstrated extraordinary or disproportionate impacts from COVID-19, if appropriate and necessary, under the authority of the California Disaster Assistance Act, Government Code section 8680 et seq., and California Code of Regulations, ntle 19, section 2900 et seq. l 0. To ensure hospitals and other health facilities are able to adequately treat patients legally isolated as a result of COVID-19, the Director of the California Department of Public Health may waive any of the licensing requirements of Chapter 2 of Division 2 of the Health and Safety Code and accompanying regulations with respect to any hospital or health facility identified in Health and Safety Code section 1250. Any waiver shall include alternative measures that, under the circumstances, will allow the facilities to treat legally isolated patients while protecting public health and safety. Any facilities being granted a waiver shall be established and operated in accordance with the facility's required disaster and mass casualty plan. Any waivers granted pursuant to this paragraph shall be posted on the Department's website.

11.To support consistent practices across California, state departments, in coordination with the Office of Emergency Services, shall provide updated and specific guidance relating to preventing and mitigating COVID-19 to schools, employers, employees, first responders and community care facilities by no later than March 10, 2020.

12.To promptly respond for the protection of public health, state entities are, notwithstanding any other state or local law, authorized to share relevant medical information, limited to the patient's underlying health conditions, age, current condition, date of exposure, and possible contact tracing, as necessary to address the effect of the COVID-19 outbreak with state, local, federal, and nongovernmental partners, with such information to be used for the limited purposes of monitoring, investigation and control, and treatment and coordination of care. The
Attachment Consent Item 7A
ernor of California
notification requirement of Civil Code section 1798.24, subdivision (i), is suspended.

13. Notwithstanding Health and Safety Code sections 1797.52 and 1797.218, during the course of this emergency, any EMT-P licensees shall have the authority to transport patients to medical facilities other than acute care hospitals when approved by the California EMS Authority. In order to carry out this order, to the extent that the provisions of Health and Safety Code sections 1797.52 and 1797.218 may prohibit EMT-P
licensees from transporting patients to facilities other than acute care hospitals, those statutes are hereby suspended until the termination of this State of Emergency.

14.The Department of Social Services may, to the extent the Department deems necessary to respond to the threat of
COVID-19, waive any provisions of the Health and Safety Code or Welfare and Institutions Code, and accompanying
regulations, interim licensing standards, or other written policies or procedures with respect to the use, licensing, or approval of facilities or homes within the Department's jurisdiction set forth in the California Community Care Facilities Act (Health and Safety Code section 1500 et seq.), the California Child Day Care Facilities Act (Health and Safety Code section 1596.70 et seq.), and the California Residential Care Facilities for the Elderly Act (Health and Safety Code section 1569 et seq.). Any waivers granted pursuant to this paragraph shall be posted on the Department's website.

I FURTHER DIRECT that as soon as hereafter possible, this proclamation be filed in the Office of the Secretary of State and that widespread publicity and notice be given of this proclamation.

IN WITNESS WHEREOF I have
hereunto set my hand and caused
the Great Seal of the State of
affixed this 4th day
ATTEST:

ALEX PADILLA
Secretary of State
Attachment Consent Item 7A
AGENDA _____ March 10, 2020

ALAMEDA COUNTY

HEALTH CARE SERVICES
AGENCY
COLLEEN CHAWLA, Director

OFFICE OF THE AGENCY DIRECTOR
1000 San Leandro Boulevard, Suite 300
San Leandro, CA 94577
TEL (510) 618-3452
FAX (510) 351-1367
March 6, 2020
The Honorable Board of Supervisors
County Administration Building
1221 Oak Street
Oakland, CA 94612
SUBJECT: ADOPT A RESOLUTION RATIFYING THE DECLARATION OF A LOCAL HEALTH EMERGENCY BY THE COUNTY HEALTH OFFICER RELATED TO THE 2019 NOVEL

CORONAVIRUS
Dear Board Members:

RECOMMENDATION
Adopt a Resolution ratifying the Declaration of a Local Health Emergency by the County Health Officer related to the 2019 Novel Coronavirus

DISCUSSION/SUMMARY
In December 2019, an outbreak of a respiratory illness due to a novel coronavirus (a disease known as 2019 Novel Coronavirus or COVID-19) was first identified in Wuhan City, Hubei Province, China. Since then, the outbreak has spread to more than 75 countries, including the United States. As of March 5, 14 California counties have had at least one citizen infected with the virus. The County of Alameda is among those counties, as are several Bay Area counties including Contra Costa, San Francisco, San Mateo, Santa Clara, Solano, and Sonoma.

The United States Centers for Disease Control and Prevention (CDC) considers COVID-19 to present a very serious threat to public health. On January 23, 2020, the CDC activated its Emergency Response System to provide ongoing support for the response to COVID-19 across the United States. On January 31, 2020, the Secretary of the US Department of Health and Human Services declared a public health emergency in the United States.

As of March 6, 2020, the CDC has identified 164 confirmed cases of COVID-19 infection, across 19 states, including 45 in California. The number of reported cases has escalated dramatically, with more than 94,000 confirmed cases and more than 3,300 deaths worldwide.

On March 1, 2020, the California Department of Public Health confirmed that an Oakland resident had become infected with COVID-19 after providing healthcare to the Solano County COVID-19 patient.

Two days later, an individual in Berkeley also tested positive for COVID-19 Infection.

Attachment Consent Item 7B
The Honorable Board of Supervisors
March 6, 2020

Page 2 of 2 ends

California Health and Safety Code section 101080 allows a local health officer to declare a local health emergency in the health officer’s jurisdiction, or any part thereof, “whenever the health officer reasonably determines that there is an imminent and proximate threat of the introduction of any contagious, infectious, or communicable disease, chemical agent, noncommunicable biologic agent, toxin, or radioactive agent.” On March 1, 2020, Alameda County Interim Health Officer Erica Pan, MD, MPH, FAAP declared a local health emergency. Dr. Pan found that with “multiple cases of COVID-19 and evidence of community transmission in the region, there is an ongoing risk and likelihood of additional COVID-19 positive patients and community spread in the County of Alameda.” Dr. Pan renewed this declaration of emergency on March 5, 2020.

The declaration of a local health emergency provides the following benefits: it allows other jurisdictions and state agencies to provide mutual aid; it allows the extraordinary costs of providing mutual aid to be a legal charge against the state; and it provides immunity to healthcare providers who render aid during the emergency. The declaration also provides the local Health Officer with the authority to exercise the full range of her power to protect the community’s public health, which includes issuance and enforcement of orders for quarantine and isolation.

Under section 101080, your Board is required to ratify the Health Officer’s declaration of emergency.

Ordinarily, your Board would need to renew this ratification every thirty (30) days; however, on March 4, 2020, California Governor Gavin Newsom issued a Proclamation of a State of Emergency relating to the COVID-19 outbreak that included a waiver of the renewal requirement: “The 30-day time period in Health & Safety Code section 101080, within which a local governing authority must renew a local health emergency, is hereby waived for the duration of this statewide emergency. Any such local health emergency will remain in effect until each local governing authority terminates its respective local emergency.” The Governor similarly waived the renewal requirement for a declaration of local emergency.

VISION 2026 GOAL
This Resolution meets the 10X goal pathway of Healthcare for All in support of our shared visions of Safe and Livable Communities, Thriving and Resilient Population, and Healthy Environment.

Sincerely,
Colleen Chawla, Director
Health Care Services Agency
Attachment Consent Item 7B
Attachment Consent Item 7B
Attachment Consent Item 7B
Attachment Consent Item 7B
Attachment Consent Item 7B
Consent Item 8
Consent Item 8
TO: East Bay Community Energy Board of Directors
FROM: Nick Chaset, Chief Executive Officer
SUBJECT: Contracts Entered Into
DATE: May 18, 2022
________________________________________________________________________

RECOMMENDATION
Accept the CEO’s report on contracts that EBCE has entered, as required by the Administrative Procurement Policy. Items executed between April 14, 2022 and May 10, 2022;
C-2022-030 DocuSign Order Form, eSignature Business Pro Edition Subscription from April 12, 2022, to April 2024, including Premier Support, cost of $7,728.

C-2022-031 Rayshine (Santa Monica, CA) Consulting Services Agreement for brand, marketing, and communications strategic planning services to EBCE through June 1, 2022, compensation not to exceed $30,000.

C-2022-032 Komorous-Towney Architects (Oakland) Consulting Services Agreement for Architectural engineering and design services for 251 8th Street, compensation not to exceed $400,000 through December 31, 2023.

C-2022-033 Oakland Private Industry Council 2022 Community Outreach Grant Agreement awarded in the amount of $30,000 to support the AMP outreach program through September 1, 2022.

C-2022-034 Read Oak Engineering (Spring Hill, TN) Consulting Services Agreement for the Services of Scott Haggerty, who will provide political consulting services to EBCE, with compensation not to exceed $20,000 through December 31, 2022.

C-2022-035 Municipal Resource Group (Wilton, CA) Consulting Services Agreement for Human resource services with compensation not to exceed $25,000 through October 25, 2022.

Consent Item 8
C-2022-037 Orrick, Herrington & Sutcliffe (San Francisco) Consulting Services Agreement for bond and tax counsel services to EBCE with total compensation not to exceed $275,000 or $300,000 based on the efficiency of the transaction, with a term of no more than three years.

C-2022-038 SMUD Amendment 7 to Exhibit A, Task Order 2; For on-going DAC-GT enrollment work, adds $16,000 in costs.

C-2022-039 Acterra First Amendment to CSA adds $6,375 in compensation for a total amount not to exceed $141,375, updates the scope of work, corrects clerical errors, and extends the termination date to March 21, 2023.

C-2022-040 Bay Alarm Commercial Fire Alarm System Purchase and/or Services Agreement; Installation, testing, and monitoring of panel & fire devices at 251 8th Street for a three-year term, with a setup & installation cost of $3,450 and an $85 monthly fee.

C-2022-041 Bay Alarm Commercial Purchase and/or Services Agreement; Installation, testing, and monitoring of an intrusion alarm at 251 8th street for a three-year term, with a setup & installation cost of $450 and a $65 monthly fee.

Consent Item 9
Consent Item 9
TO: East Bay Community Energy Board of Directors
FROM: Kelly Brezovec, Sr. Manager of Account Services
SUBJECT: Request Amendment to Rate Setting Protocol (Action Item) DATE: May 18, 2022
___________________________________________________________________ Recommendations
Adopt an amendment to the Rate Setting Protocol to remove the community workshop requirement in a year when there is no change to the value proposition.

Background
The EBCE Board of Directors approved the original Rate Setting Protocol on September 26, 2018, and additional amendments on December 18, 2019, to address changes in the billing engine configuration. Public engagement is outlined in the rate setting protocol as follows presentations to the Executive Committee, Community Advisory Committee, and Board of Directors. Additionally, the protocol calls for three community workshops and a period for written comments.

Discussion
Staff has facilitated public engagement annually in May 2019, 2020, and 2021.

Year Rate Setting Written Comments Workshop Attendance
2019 No Changes Proposed 2 5
Consent Item 9
2020 Bright Choice Discount Change: 1.5%
to 1.0%
Brilliant 100 Proposed Sunset
8 15
2021 No Changes Proposed 0 2
EBCE defines the value proposition as the price differential between EBCE’s and PG&E’s generation rates. Today’s value proposition is: Bright Choice with a 1% savings compared to PG&E’s generation rate and Renewable 100 at $0.01 per kilowatt-hour more than PG&E’s generation rate.

Staff recommends removing the requirement for workshops in a year when there are no proposed changes to the value proposition. This is supported by the limited public participation in workshops in 2019 and 2021.

Staff recommends including the option of a webinar style meeting in addition to the option of in-person, reducing the required meetings to two, and maintaining the requirements to present to the Executive Committee, Community Advisory Committee, and Board of Directors, and the period of written comments each year when there are proposed changes to the value proposition.

In years when there are no proposed changes to the value proposition, staff will continue with public outreach to encourage participation via the public comment process and public meetings when the annual budget is being discussed. Staff may also consider hosting an informal educational webinar, hosted during a similar timeframe as the value proposition meeting might have been held, as a means of maintaining the annual meeting cadence to encourage participation.

Financial Impact
There is no expected financial impact due to this policy change.

Attachment
A. Resolution Authorizing Staff to Amend the Rate Setting Protocol to Remove the Community Workshop Requirement in a Year When there is no Change to the Value Proposition
B. Amended Rate Setting Policy
Amendment Consent Item 9A
RESOLUTION NO. R-2022-xx

A RESOLUTION OF THE BOARD OF DIRECTORS

OF THE EAST BAY COMMUNITY ENERGY AUTHORITY AUTHORIZING STAFF TO AMEND

THE RATE SETTING PROTOCOL TO REMOVE THE COMMUNITY WORKSHOP

REQUIREMENT IN A YEAR WHEN THERE IS NO CHANGE TO THE VALUE PROPOSITION WHEREAS The East Bay Community Energy Authority (“EBCE”) was formed as a community choice aggregation agency (“CCA”) on December 1, 2016, Under the Joint Exercise of Power Act, California Government Code sections 6500 et seq., among the County of Alameda, and the Cities of Albany, Berkeley, Dublin, Emeryville, Fremont, Hayward, Livermore, Piedmont, Oakland, San Leandro, and Union City to study, promote, develop, conduct, operate, and manage energy-related climate change programs in all of the member jurisdictions. The cities of Newark and Pleasanton, located in Alameda County, along with the City of Tracy, located in San Joaquin County, were added as members of EBCE and parties to the JPA in March of 2020.

WHEREAS, on September 26, 2018, the Board approved by motion a Rate Setting Protocol;
WHEREAS, on December 17, 2019, the Board approved an amendment to the Rate Setting Protocol to allow for rate setting by vintage; WHEREAS, it is in the interest of EBCE to maintain customer engagement in establishing the value proposition; and
WHEREAS, it is in the interest of EBCE to operate efficiently, streamlining requirements as the organization learns from past experiences.

WHEREAS, the Rate Setting Protocol requires that EBCE host a community workshop with each rate setting;
WHEREAS, limited public participation in community workshops in years where there is no change to the EBCE value proposition indicates that there may not be a need for these workshops in those years;
WHEREAS, EBCE would like to streamline its process to eliminate this unncessary requirement in years where there is no change to the value proposition; and

NOW, THEREFORE, THE BOARD OF DIRECTORS OF THE EAST BAY COMMUNITY ENERGY AUTHORITY DOES HEREBY RESOLVE AS FOLLOWS:

Section 1. The Board hereby adopts the Amended and Restated Rate Setting Policy which (among other things) eliminates the requirement for a community workshop in years where there is no change to the value proposition.

Amendment Consent Item 9A
ADOPTED AND APPROVED this 18th day of May, 2022.

Dianne Martinez, Chair
ATTEST:

Adrian Bankhead, Clerk of the Board
Amendment Consent Item 9B
Amended Rate Setting Protocol

AMENDED AND RESTATED RATE SETTING POLICY
From original protocol approved by motion on 9/26/18 and amended on 12/18/19 Policy Number 14.2
May 18, 2022
Item #
I. Purpose
This policy serves to provide direction to EBCE staff on actions related to electric rates.

II. Rate Actions
a. Rate Setting
EBCE Staff must receive Board approval to revise the service level value propositions (e.g. offering a greater or lesser discount on Bright Choice).
b. Rate Setting Process
EBCE’s Implementation Plan and Statement of Intent (August 2017) states that “EBCE will review its rates at a minimum once a year”.

The rate review and setting process is as follows:

Amendment Consent Item 9B

1. Executive Committee meeting. Staff will provide a staff report containing analysis of PG&E rates and preliminary recommendations for changes to EBCE’s value proposition, if any.

2. Community workshops. In a year when there is a proposed change to the value proposition, staff will conduct community workshops. Based on feedback received at the Executive Committee meeting, staff will revise analysis if needed, and solicit comments from the community. This will be achieved through a minimum of two (2) community meetings in geographically diverse locations, or online in a webinar-style format. Staff will consolidate feedback from these meetings into a supporting document that will be presented to the Board.

3. Written comments. Each year when there is a proposed change to the value proposition, written comments will be accepted in lieu of, or in addition to, verbal comments made during these workshops. A period of time will be designated for written comments. A specific email address will be provided to the public to submit comments, along with a clear deadline for submission.

4. Community Advisory Committee meeting. The CAC will receive a presentation from staff and discuss the staff recommendation.

5. Board meeting. Staff will present analysis, findings, and recommendations derived from feedback from an Executive Committee meeting, Community Workshops, and a Community Advisory Committee meeting. The Board will have the opportunity to vote on staff recommendations. If Board requests further analysis, the process will return to the Executive Committee. The Executive Committee can then make a final recommendation that will be brought to the next Board meeting.
c. Rate Modification
EBCE Staff is authorized to adjust EBCE’s rates to maintain the approved value proposition for each service level. If there are changes to PG&E generation rates or fees that result in a more beneficial value proposition for customers, EBCE Staff is authorized to not adjust the rates.

Consent Item 10
Consent Item 10
TO: East Bay Community Energy Board of Directors
FROM: Howard Chang, Chief Operating Officer
SUBJECT: Amend Administrative Procurement Policy
DATE: May 18, 2022
________________________________________________________________________ Recommendation
Adopt a Resolution to amend the Administrative Procurement Policy. The amendments clarify what types of contracts are reported on, outline the requirements for purchases of goods and services under $5,000, explain that signing authority is based on contract amounts during each fiscal year, and format the document for better comprehension.

Background and Discussion
On February 7, 2018, the Board of Directors approved a Resolution adopting an Administrative Procurement Policy. The policy was most recently amended and restated on December 15, 2021. Staff worked with General Counsel to make necessary and appropriate changes to the policy.

This Amendment clarifies the following:

1. Exactly what contracts will be reported monthly to the Board: all contracts excluding non-disclosure agreements, personnel agreements, and power purchase agreements (Section 4.5).

2. A Purchase Order may be used for the purchase of goods or low-risk off-site services under $5,000, a contract is not required (Section III, Table 1).

3. That the dollar amounts mentioned in Section III, Table 2, Table 4 and Table 5, related to signing authority apply to limits per fiscal year.

The Amendment also includes formatting changes that allow for better comprehension.

Fiscal Impact
There is no anticipated fiscal impact associated with these amendments.

Attachments
Consent Item 10
A. Resolution to Amend the Administrative Procurement Policy B. Amended and Restated Procurement Policy (with redline changes from previous version)
C. Amended and Restated Procurement Policy (clean)
Attachment Consent Item 10A
RESOLUTION NO. R-2022-

A RESOLUTION OF THE BOARD OF DIRECTORS

OF THE EAST BAY COMMUNITY ENERGY AUTHORITY TO ADOPT AN AMENDED AND

RESTATED ADMINISTRATIVE PROCUREMENT POLICY
WHEREAS The East Bay Community Energy Authority (“EBCE”) was formed as a community choice aggregation agency (“CCA”) on December 1, 2016, under the Joint Exercise of Powers Act, California Government Code sections 6500 et seq., among the County of Alameda, and the Cities of Albany, Berkeley, Dublin, Emeryville, Fremont, Hayward, Livermore, Piedmont, Oakland, San Leandro, and Union City to study, promote, develop, conduct, operate, and manage energy-related climate change programs in all of the member jurisdictions. The cities of Newark and Pleasanton, located in Alameda County, along with the City of Tracy, located in San Joaquin County, were added as members of EBCE and parties to the JPA in March of 2020.

WHEREAS It is in the interest of EBCE to establish administrative procurement practices that facilitate efficient business operations and provide fair compensation and local workforce opportunities whenever possible within a framework of high quality, competitive service offerings;
WHEREAS On February 7, 2018, the Board approved an Administrative Procurement Policy. Recently, on December 15, 2021, the Board approved an Amended and Restated Administrative Procurement Policy 1.7; and WHEREAS EBCE staff feel it would be useful to make certain clarifications and adjustments to the formatting to make the Policy easier to read and understand.

NOW, THEREFORE, THE BOARD OF DIRECTORS OF THE EAST BAY COMMUNITY ENERGY AUTHORITY DOES HEREBY RESOLVE AS FOLLOWS:

Section 1. The Board hereby adopts the Eighth Amended and Restated Administrative Procurement Policy, attached as Exhibit A and listed as Policy # 1.8, which makes clarifications regarding: the categories of contracts that staff will report to the Board on, utilizing purchase orders for purchases of goods and low-risk off-site services under $5,000, and signing authority per fiscal year, as well as adjustments to formatting
ADOPTED AND APPROVED this 18th day of May, 2022.

Attachment Consent Item 10A
Dianne Martinez, Chair
ATTEST:

Adrian Bankhead, Clerk of the Board

SEVENTHFIFTH AMENDED AND RESTATED ADMINISTRATIVE PROCUREMENT POLICY
Policy Number 1.87
December 15, 2021May 18, 2022
Agenda Item # 13
Resolution Number R-2021-54
I. PURPOSE
It is in the interest of East Bay Community Energy (“EBCE”) to establish administrative procurement practices that facilitate efficient business operations and provide fair compensation and local workforce opportunities whenever possible within a framework of high quality, competitive service offerings.

II. TYPES OF CONTRACTS
II.

1. Contracts for Goods and Non-Professional Services. As used in this policy, “General Contractual Services” means:

1.1. Any and all supplies, articles, equipment, or personal property furnished to or used by an organizational unit of EBCE; and

1.2. Most types of services, excluding professional services as defined below, under which the contractor provides services which are required by EBCE, but not furnished by the EBCE’s own employees.

2. Contracts for Professional Services. As used in this policy, “Professional Services” means:

Professional Services are not considered General Contractual Services for the purpose of these procurement procedures.

3. Power Procurement Contracts

3.1. Contracts for energy (also known as Power Purchase Agreements or PPAs) or energy related products shall be subject to the requirements and signing authorities set out in Section IX of this Policy.

4. All Contracts

4.1. When procuring goods and services utilizing federal funds (e.g. grant funds), EBCE shall comply with all federal project requirements and Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. (See 2 CFR § 200) Formatted: Character scale: 100%
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numbering
Attachment Consent Item 10B

4.2. No EBCE employee, official, or director shall split purchases into more than one purchase in order to avoid the procurement requirements in this policy. Splitting purchases does not allow for a competitive marketplace, increases administrative workflow, and may create ethical issues.

4.3. No EBCE employee, officer, or Director shall accept, directly or indirectly, any gift, rebate, money or anything else of value from any person or entity if such gift, rebate, money or anything of value is intended to reward or be an inducement for conducting business, placing orders with, or otherwise using the employee’s position to secure an agreement with EBCE.

4.4. Prior to signing any agreement for General Contractual Services or Professional Services, the individual signing shall ensure all of the following:

4.4.1. The contract compensation has been budgeted for in the current EBCE budget;

4.4.2. That adequate funds have been appropriated by the Board;

4.4.3. That such funds are unexpended and unencumbered sufficient to pay the expense of the contract; and

4.4.4. That any agreement for General Contractual Services or Professional Services for an amount of $5,000 or more in one calendar year has been approved as to form and content by the General Counsel or his/her designee.

4.5. EBCE shall report on all new contracts, regardless of scope or contract value, at each Board meeting, except non-disclosure agreements, personnel contracts, and Power Purchase Agreements. Unless subject to the attorney client privilege or some other legal protection, as a public agency, EBCE shall release all public records, including contracts, as required by the Public Records Act.

4.6. Agreements with existing vendors may be amended and/or extended to allow for the continuation of services for no more than a total term of five (5) years. Such amendments/extensions are subject to the applicable signing authority identified in Tables 1-4 based on the total dollar amount of the agreement.

4.7. The CEO may suspend the requirements of Section III (General Contractual Services Procurement) or Section V (Professional Services Procurement) for any agreement.

Furthermore, the COO may suspend the requirements of Section III or Section V for any agreement they would otherwise have the authority to sign. However, all agreements for which the required procurement procedures have been suspended pursuant to this Section II. 4.7 must be approved by the Chair and Vice Chair of the Board of Directors and must comply with signing authority restrictions identified in Section III, Table 2, and Section V, Table 4.

5. Promotional Items and Bulk Purchases

5.1. The purchase of office supplies, promotional items, and similarly low risk goods bought in bulk online or otherwise are subject to the relevant procurement methods identified in Section III, but do not require a Consulting Services Agreement or other agreement.

Attachment Consent Item 10B
III. GENERAL CONTRACTUAL SERVICES PROCUREMENT

1. Procurement Method

1.1. Table 1 indicates the appropriate procurement method for the purchase of General Contractual Services of certain dollar amounts.

1.2. Nothing in this section prohibits the use of a more stringent procurement method than the one indicated by Table 1. At his or her discretion, the CEO may direct that an agreement for General Contractual Services is awarded through the Formal Bidding Procedures described herein.

Table 1
PROCUREMENT METHOD DOLLAR AMOUNT per

FISCAL YEAR ADDITIONAL REQUIREMENTS
Formal Bidding Procedure > $100,000 RFP/RFQ
Solicit 3 written quotes; may
be in electronic format $50,000 - $100,000
Quotes must include provider’s
name, address, phone number,
professional
license number, if applicable
Solicit 3 verbal quotes $10,000 - $49,999.99
Staff shall note quotes by
including the providers’ name,
address, phone number and
amount of the verbal l
proposal in EBCE’s records
No solicitation necessary < $10,000 Seek the lowest price for the highest quality
Purchase Order Can Be Used <$5,000 * A contract is not required for theContracts purchase offor
goods or low-risk off- site
services under $5,000only

2. Signing Authority

2.1. Table 2 indicates the appropriate signing authority for the purchase of General Contractual Services of certain dollar amounts.

2.2. Nothing in this section prohibits EBCE staff from seeking approval of a more senior signing authority than is permitted by this policy.

Table 2

SIGNING AUTHORITY DOLLAR AMOUNT
per FISCAL YEAR

CONTRACT TYPE
Board Approval > $100,000 All contracts
Chief Executive Officer, or
his/her designee $0 - $100,000 All contracts
General Counsel $0-$50,000
All contracts related to the activities or
functions of the Office of the General
Counsel
Chief Operating Officer $0-$25,000 All contracts related to the activities or functions of the Office of the COO
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Attachment Consent Item 10B
Senior Director or
Vice President $0-$10,000
All contracts whose object or purpose is
related to the activities or functions of
that Senior Director or Vice President
Director $0-$5,000
All contracts whose object or purpose is
related to the activities or functions of
that Director
IV. FORMAL BIDDING PROCEDURES
Except as otherwise specifically directed in writing by the CEO, agreements for the purchase of General Contractual Services for a total amount that exceeds $100,000 per fiscal year shall be procured as follows:

1. Formal Bid Invitations. Invitations to participate in the Request for Proposal/Request for Qualifications process shall include a general description of the supplies or services sought by EBCE, and shall specify the time, place and date for opening bids.

2. Evaluation. Bids and proposals received through a competitive solicitation shall be subject to a set of criteria and a scoring system, reviewed and evaluated by relevant EBCE staff and an evaluation committee selected by the relevant staff, CEO, COO or General Counsel, or at the discretion of the Board, members of a designated Board subcommittee.

3. Lowest Responsible Bidder. “Lowest responsible bidder” as used in this policy shall mean that bidder who best responds in price, quality, service, fitness, or capacity to the particular requirements of EBCE. Price alone shall not be the determining factor but shall be considered along with other factors, including but not limited to the following:

3.1. EBCE seeks to support companies and contractors that reflect its values and has identified four vendor/contractor categories that shall be given special consideration during bid evaluation and selection. In competitive solicitations, these categories shall receive bonus percentages/points ranging from 2.5% - 5% for a maximum bonus total of 12.5% in a bid scoring process:

3.1.1 Businesses within Service Territory: EBCE desires to support business within its service territory. Businesses with office(s) located in EBCE’s service territory and businesses that have at least 25% of their workforce who reside in EBCE’s service territory shall receive a bonus equal to 5% or 5 points out of a 100-point scoring system in competitive solicitations.

3.1.2 Union Labor: EBCE desires to support the use of union labor where possible. EBCE shall make its best effort to work with unionized contractors and subcontractors in the provision of goods and services to EBCE. Businesses who use union labor and/or unionized contractors shall receive a bonus equal to 2.5% or 2.5 points out of a 100- point scoring system in competitive solicitations.

3.1.3 Disabled Veteran Business Enterprises: EBCE desires to support Disabled Veteran Business Enterprises (DVBEs). Businesses that are registered with the California Department of General Services as a DVBE shall receive a bonus equal to 2.5% or 2.5 points out of a 100-point scoring system in competitive solicitations.

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Attachment Consent Item 10B

3.1.4 Disadvantaged Communities: EBCE desires to support businesses located in a Disadvantaged Community (DAC) as identified by the California Environmental Protection Agency’s (CalEPA) CalEnviroScreen Tool. Businesses with a primary office (i.e. where work is primarily conducted for EBCE) located in a DAC, as determined by the latest version of the Tool at the time, shall receive a bonus equal to 2.5% or 2.5 points out of a 100-point scoring system in competitive solicitations.

3.2. EBCE is committed to the highest standards of responsible behavior and integrity in all of its business relationships. EBCE will consider a company’s business practices, environmental track record, and commitment to fair employment practices and compensation in its procurement decisions.

3.3. Award of Contract. EBCE shall award the contract to purchase goods or services to the lowest responsible bidder, unless such an award would be prohibited by California law.

V. PROFESSIONAL SERVICES PROCUREMENT

1. Procurement Method

1.1. Table 3 indicates the appropriate procurement method for the purchase of Professional Services of certain dollar amounts.

1.2. Nothing in this section prohibits the use of a more stringent procurement method than the one indicated by Table 3. At his or her discretion, the CEO may direct that an agreement for Professional Services is awarded through the Formal Bidding Procedures described herein.

Table 3
PROCUREMENT METHOD DOLLAR AMOUNT per

FISCAL YEAR

ADDITIONAL REQUIREMENTS
Solicit 3 written quotes; may
be in electronic format $50,000 and above
Proposal must include provider’s
name, address, phone number,
professional license number, if
applicable
Solicit 3 verbal quotes $10,000 - $49,999.99
Staff shall note quotes by including
the providers’ name, address,
phone number and amount of the
verbal
proposal in EBCE’s records
No solicitation is necessary $0 - $10,000 Seek the lowest price for the highest quality

2. Signing Authority

2.1. Table 4 indicates the appropriate signing authority for an agreement for Professional Services of certain dollar amounts.

2.2. Nothing in this section prohibits EBCE staff from seeking approval of a more senior signing authority than is permitted by this policy.

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Attachment Consent Item 10B
Table 4

SIGNING AUTHORITY DOLLAR AMOUNT
per FISCAL YEAR

CONTRACT TYPE
Board Approval > $100,000 per
fiscal year
All contracts
Chief Executive Officer, or
his/her designee
$0 - $100,000 per
fiscal year All contracts
General Counsel $0-$50,000 per fiscal
year
All contracts related to the activities or
functions of the Office of the General
Counsel
Chief Operating Officer $0-$25,000 per fiscal
year
All contracts related to the activities or
functions of the Office of the COO
Senior Director or Vice
President
$0-$10,000 per fiscal
year
All contracts whose object or purpose
is related to the activities or functions
of that
Senior Director or Vice President
Director $0-$5,000 per fiscal
year
All contracts whose object or purpose
is
related to the activities or functions of
that Director
VI. SOLE SOURCE PROCUREMENT

1. Under some circumstances, EBCE competitive solicitation requirements may be dispensed with when the goods or services are only available from one source either because the brand or trade name article, goods, or product or proprietary service is the only one which will properly meet the needs of the EBCE or the item or service is unique and available only from a sole source.

2. Sole source purchasing, whereby the procurement methods identified in Tables 1-4 are not required, is authorized when the goods or services contemplated are only able to be performed by a sole provider, such as the holder of an exclusive patent or franchise, for the purchase of unique or innovative goods or services including but not limited to computer software and technology, or for purchases of goods or services when there is a demonstrated need for compatibility with an existing item or service used by EBCE.

3. A sole source may be designated when it is apparent that a needed product or service is uniquely available from the source, or for all practical purposes, it is justifiably in the best interest of EBCE.

4. The following factors are not sufficient to justify a sole source procurement:

4.1. Personal preference for product or vendor

4.2. Cost

4.3. Vendor performance

4.4. Local service (this may be considered an award factor in competitive bidding)

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Attachment Consent Item 10B
VI. EMERGENCY PROCUREMENT

1. In the event of an emergency, the CEO may suspend the normal purchasing and procurement requirements for goods and services related to abatement of the impacts or effects of the emergency.

2. An emergency is deemed to exist in the following circumstances:

2.1. There is an unexpected occurrence requiring immediate action to prevent or mitigate the loss or impairment of life, health, property, or essential public services, including the provision of energy or power to EBCE customers; or

2.2. There is immediate need to prepare for national or local defense; or

2.3. There is a breakdown in infrastructure or an essential service which requires the immediate purchase of supplies or contractual services to protect the public heath, or safety or property; or

2.4. A local emergency or disaster has been declared.

VII. COOPERATIVE PURCHASING

1. The procurement methods identified in Table 1 -4 shall not be required when the contract for goods or services will be provided by another governmental agency.

2. EBCE may adopt another governmental agency’s agreement with a contractor (“Piggyback Agreement”) as its own without adhering to the procurement methods identified in Table 1-4 if that Piggyback Agreement is the product of the respective governmental agency’s formal competitive solicitation process, provided that that agency’s procurement is not in conflict with California law.

VIII. PUBLIC PROJECTS

1. Uniform Public Construction Cost Accounting Act. EBCE adheres to the alternative bidding procedures provided by the Uniform Public Construction Cost Accounting Act, California Public Contract Code section 22000 et seq. (UPCCAA) Public projects (as defined in Section 22002 of the California Public Contract Code) that do not exceed the dollar limits in Section 22032(b) of the Public Contract Code (as such limits currently exist or may subsequently be amended), may be let to contract by informal procedures as set forth in the UPCCAA.

2. At the time of the adoption of this Policy, the UPCCAA applied to the following types of projects:

2.1. Public projects include construction, reconstruction, erection, alteration, renovation, improvement, demolition, and repair work involving any publicly owned, leased, or operated facility. This includes painting or repainting of any publicly owned, leased, or operated facility.

Attachment Consent Item 10B

2.2. Public projects up to $60,000 may be performed by EBCE employees, by negotiated contract, or by purchase order pursuant to the UPCCAA.

2.3. Public projects up to $200,000 may be contracted using informal procedures as set forth in the UPCCAA.

3. Pre-Qualified List. A list of contractors may be developed and maintained in accordance with the provisions of Section 22034 of the Public Contract Code and criteria promulgated from time to time by the California Uniform Construction Cost Accounting Commission (CUCCAC).

4. Notice.

4.1. Where a public project is to be performed, a notice inviting informal bids shall be mailed, faxed, or emailed not less than ten (10) days before bids are due to all contractors for the category of work to be bid as shown on the Pre-Qualified list developed in accordance with this Section IV, and to all construction trade journals as specified by the CUCCAC in accordance with Section 22036 of the Public Contract Code. Additional contractors and/or construction trade journals may be notified at the discretion of the department soliciting bids, provided, however; if there is no list of qualified contractors maintained by EBCE for the particular category of work to be performed, the notice inviting bids shall be sent only to the construction trade journals specified by the CUCCAC.

4.2. The notice inviting informal bids shall describe the project in general terms and how to obtain more detailed information about the project and state the time and place for the submission of bids.

5. Award of Contract. The CEO and his or her designee is authorized to award public project contracts, subject to the signing authority permitted by Table 5. Nothing in this section prohibits EBCE staff from seeking approval of a more senior signing authority than is permitted by this policy.

Table 5

SIGNING AUTHORITY DOLLAR AMOUNT
per fiscal year
Executive Committee of the Board of
Directors or Board of Directors
Approval
> $100,000 per fiscal year
Chief Executive Officer, or his/her
designee
$0 - $100,000 per fiscal year
General Counsel
$0-$50,000 per fiscal year
Chief Operating Officer $0-$25,000 per fiscal year
Senior Director or Vice President $0-$10,000 per fiscal year Director
$0-$5,000 per fiscal year
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Attachment Consent Item 10B
IX. PROCUREMENT OF POWER

1. EBCE must secure sufficient power resources and energy attributes to serve its customers, comply with State law and meet EBCE’s and its member agencies’ goals. The Board shall approve the form of all master power purchase agreements. The signing authority in Section 4 shall not apply to power and energy attribute procurement. The following EBCE staff shall be authorized to enter into power purchase agreements and other agreements to secure power and energy attributes providing such agreements are in substantially the same form as the Board-approved master power purchase agreements, and that all transactions and agreements are in strict compliance with EBCE’s Risk Management Policy:

1.1. The CEO is authorized to enter into agreements in accordance to the approved Risk Management Policy.

1.2. The COO is authorized to enter into agreements in accordance to the approved Risk Management Policy, provided that transactions shall not be over two years in duration and

1.2. $10,000,000 in total compensation.

1.3. The Director of Power Resources is authorized to enter into agreements in accordance to the approved Risk Management Policy, provided that transactions shall not be over one year in duration and not be over $2,000,000 in compensation.

1.4. With dual signatures, the COO and Director of Power Resources are authorized to enter into agreements with equivalent authority as the CEO in accordance with the approved Risk Management Policy.

X. MISCELLANEOUS

1. The following signing authorities shall apply, after review and approval of the named agreements by the General Counsel, or his/her designee, except where in conflict with the Joint Powers Agreement, state or federal law:

1.1. Non-Disclosure Agreements – Director level and above,

1.2. Banking and Treasury Administration – COO level and above, and

1.3. Release of Liability and Indemnification – Director level and above.

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Attachment Consent Item 10B

SEVENTH AMENDED AND RESTATED ADMINISTRATIVE PROCUREMENT POLICY Policy Number 1.8
May 18, 2022
Agenda Item #
Resolution Number
I. PURPOSE
It is in the interest of East Bay Community Energy (“EBCE”) to establish administrative procurement practices that facilitate efficient business operations and provide fair compensation and local workforce opportunities whenever possible within a framework of high quality, competitive service offerings.

II. TYPES OF CONTRACTS

1. Contracts for Goods and Non-Professional Services. As used in this policy, “General Contractual Services” means:

1.1. Any and all supplies, articles, equipment, or personal property furnished to or used by an organizational unit of EBCE; and

2. Contracts for Professional Services. As used in this policy, “Professional Services” means:

2.1. The services of attorneys, physicians, architects, engineers, consultants, auditors, or other individuals or organizations possessing a high degree of professional, unique specialized technical skill or expertise, not always adaptable to competitive bidding. Professional Services are not considered General Contractual Services for the purpose of these procurement procedures.

3. Power Procurement Contracts

4. All Contracts

4.4. Prior to signing any agreement for General Contractual Services or Professional Services, the individual signing shall ensure all of the following:

4.4.1. The contract compensation has been budgeted for in the current EBCE budget;

4.4.2. That adequate funds have been appropriated by the Board;

4.4.3. That such funds are unexpended and unencumbered sufficient to pay the expense of the contract; and

4.7. The CEO may suspend the requirements of Section III (General Contractual Services Procurement) or Section V (Professional Services Procurement) for any agreement.

5. Promotional Items and Bulk Purchases

Attachment Consent Item 10C
III. GENERAL CONTRACTUAL SERVICES PROCUREMENT

1. Procurement Method

1.1. Table 1 indicates the appropriate procurement method for the purchase of General Contractual Services of certain dollar amounts.

Table 1
PROCUREMENT METHOD DOLLAR AMOUNT per

FISCAL YEAR ADDITIONAL REQUIREMENTS
Formal Bidding Procedure > $100,000 RFP/RFQ
Solicit 3 written quotes; may be
in electronic format $50,000 - $100,000
Quotes must include provider’s name,
address, phone number, professional
license number, if applicable
Solicit 3 verbal quotes $10,000 - $49,999.99
Staff shall note quotes by including
the providers’ name, address, phone
number and amount of the verbal
proposal in EBCE’s records
No solicitation necessary < $10,000 Seek the lowest price for the highest quality
Purchase Order Can Be Used <$5,000 * A contract is not required for the purchase of goods or low-risk off-site services under $5,000

2. Signing Authority

2.1. Table 2 indicates the appropriate signing authority for the purchase of General Contractual Services of certain dollar amounts.

2.2. Nothing in this section prohibits EBCE staff from seeking approval of a more senior signing authority than is permitted by this policy.

Table 2

SIGNING AUTHORITY DOLLAR AMOUNT
per FISCAL YEAR

Price alone shall not be the determining factor but shall be considered along with other factors, including but not limited to the following:

Attachment Consent Item 10C

3.3. Award of Contract. EBCE shall award the contract to purchase goods or services to the lowest responsible bidder, unless such an award would be prohibited by California law.

V. PROFESSIONAL SERVICES PROCUREMENT

1. Procurement Method

1.1. Table 3 indicates the appropriate procurement method for the purchase of Professional Services of certain dollar amounts.

Table 3
PROCUREMENT METHOD DOLLAR AMOUNT per

FISCAL YEAR

ADDITIONAL REQUIREMENTS
Solicit 3 written quotes; may be
in electronic format $50,000 and above
Proposal must include provider’s name,
address, phone number,
professional license number, if
applicable
Solicit 3 verbal quotes $10,000 - $49,999.99
Staff shall note quotes by including the
providers’ name, address, phone
number and amount of the verbal
proposal in EBCE’s records
No solicitation is necessary $0 - $10,000 Seek the lowest price for the highest quality

2. Signing Authority

2.1. Table 4 indicates the appropriate signing authority for an agreement for Professional Services of certain dollar amounts.

2.2. Nothing in this section prohibits EBCE staff from seeking approval of a more senior signing authority than is permitted by this policy.

Attachment Consent Item 10C
Table 4

SIGNING AUTHORITY DOLLAR AMOUNT
per Fiscal Year

4. The following factors are not sufficient to justify a sole source procurement:

4.1. Personal preference for product or vendor

4.2. Cost

4.3. Vendor performance

4.4. Local service (this may be considered an award factor in competitive bidding)

4.5. Features that exceed the minimum requirements for the goods or services Attachment Consent Item 10C
VI. EMERGENCY PROCUREMENT

1. In the event of an emergency, the CEO may suspend the normal purchasing and procurement requirements for goods and services related to abatement of the impacts or effects of the emergency.

2. An emergency is deemed to exist in the following circumstances:

2.2. There is immediate need to prepare for national or local defense; or

2.3. There is a breakdown in infrastructure or an essential service which requires the immediate purchase of supplies or contractual services to protect the public heath, or safety or property; or

2.4. A local emergency or disaster has been declared.

VII. COOPERATIVE PURCHASING

1. The procurement methods identified in Table 1 -4 shall not be required when the contract for goods or services will be provided by another governmental agency.

VIII. PUBLIC PROJECTS

2. At the time of the adoption of this Policy, the UPCCAA applied to the following types of projects:

Attachment Consent Item 10C

2.2. Public projects up to $60,000 may be performed by EBCE employees, by negotiated contract, or by purchase order pursuant to the UPCCAA.

2.3. Public projects up to $200,000 may be contracted using informal procedures as set forth in the UPCCAA.

4. Notice.

Table 5

SIGNING AUTHORITY DOLLAR AMOUNT
per fiscal year
Executive Committee of the Board of
Directors or Board of Directors Approval > $100,000
Chief Executive Officer, or his/her
designee
$0 - $100,000
General Counsel $0-$50,000
Chief Operating Officer $0-$25,000
Senior Director or Vice President $0-$10,000
Director $0-$5,000
Attachment Consent Item 10C
IX. PROCUREMENT OF POWER

1.1. The CEO is authorized to enter into agreements in accordance to the approved Risk Management Policy.

1.2. The COO is authorized to enter into agreements in accordance to the approved Risk Management Policy, provided that transactions shall not be over two years in duration and $10,000,000 in total compensation.

1.4. With dual signatures, the COO and Director of Power Resources are authorized to enter into agreements with equivalent authority as the CEO in accordance with the approved Risk Management Policy.

X. MISCELLANEOUS

1.1. Non-Disclosure Agreements – Director level and above,

1.2. Banking and Treasury Administration – COO level and above, and

1.3. Release of Liability and Indemnification – Director level and above.

Attachment Consent Item 10C
CEO Report Item 11
CEO Report Item 11
TO: East Bay Community Energy Board of Directors
FROM: Nick Chaset, Chief Executive Officer
SUBJECT: CEO Report (Informational Item)
DATE: May 18, 2022
________________________________________________________________________ Recommendation
Accept Chief Executive Officer (CEO) report on update items below.

Executive Committee
The Executive Committee met on April 29, 2022 at 12pm. Members received a review of the FY 2022/2023 Draft Budget. The next meeting is scheduled for Friday, May 27, 2022 at 12pm.

New Staff
Mariana Hamilton-Atkins, Salesforce Administrator
Mariana joined EBCE's Technology and Analytics team in April 2022 as the Salesforce Administrator. Mariana assists with project implementation and administrative duties as it relates to EBCE's growing Salesforce application.

Prior to joining EBCE, Mariana was the Development Coordinator at the Ecology Center in Berkeley, where she assisted managing internal operations, platform development as it pertained to fundraising, as well serving as the main Salesforce administrator.

Mariana earned a Masters of Science in Clinical Psychology from Notre Dame de Namur University in Belmont.

Trevor Cherr, Senior Director, Human Resources
Trevor joined EBCE on 4/25/22 to lead the Human Resources department. Trevor is responsible for designing and driving culture programs, recruitment and retention strategies, as well as performance management and talent development for EBCE team members.

Before joining EBCE, Trevor worked at companies within the outdoor and renewable energy sectors including CamelBak Products, Vista Outdoor, and Soligent Distribution, leading Human Resources as well as other strategic initiatives inclusive of DEI, community activism, land and resource conservation, and corporate sustainability.

CEO Report Item 11
Trevor holds a M.S. in Industrial and Organizational Psychology from San Francisco State University and a certificate in Sustainable Business Practices from Dominican University.

Aaron Ruder, Senior Salesforce Associate
Aaron joined EBCE on 4/25/22 as the Senior Salesforce Associate on the Data and Analytics team. Aaron will be responsible for improving data quality and visibility, and for enhancing the user experience in Salesforce.

Prior to EBCE, Aaron worked in Revenue Operations for Startups on the in-house and consulting ends. He has Six Salesforce Certifications and counting.

Aaron earned an MPA from Northern Illinois University. He loves classical music, cats and building things in Salesforce.

Izzy Carson, Power Resources Manager
Izzy joined EBCE on 5/4/2022 as Power Resources Manager. Izzy will be responsible for managing EBCE’s renewable energy and carbon-free energy position and entering into transactions to optimize our position. She will also support negotiations of long-term contracts for renewable energy and energy storage resources.

Izzy has more than 13 years of experience working in the energy field working. She has work for both developers of renewable energy projects and in energy procurement at PG&E, where she lead procurement of renewable energy for programs targeted to the needs of different customer groups. Most recently, Izzy managed PG&E’s energy efficiency programs and represented the organization on the Statewide Energy Efficiency Team.

Izzy holds a BS in Environmental Studies and Economics from the University of California at Santa Cruz and an MBA from the University of San Francisco.

Ray Dai, Power Resources and Credit Risk Manager
Ray joined EBCE on 5/4/2022 as Power Resources Market and Credit Risk Manager. Ray will be responsible for modeling EBCE’s risk exposure across any unhedged positions and across positions hedged through short and long-term transactions. He will also evaluate core market drivers and provide strategic guidance on potential for changes in market volatility and analysis on market-wide disturbances.

Ray has more than 20 years of electric utility experience in energy wholesale markets & transactions, risk management and compliance, power supply contract negotiation & portfolio optimization, load forecast & resource planning, and power generation resources development.

Ray holds a MA in International Economics & Policy in Energy Environment, Science & Technology from Johns Hopkins University.

John Newton, Principal Regulatory Analyst
John joined EBCE’s Public Policy Team on 5/11/22 as a Principal Regulatory Analyst. John assists with EBCE’s activities around Integrated Resource Plans (IRP) and Resource Adequacy (RA), as well as broader regulatory advocacy at state agencies.

CEO Report Item 11
Prior to joining EBCE, John was with PG&E. There, he managed PG&E's engagement in IRP proceedings, and helped develop PG&E’s 2020 IRP filing and continuing IRP activities. John was also involved in the coordination of regulatory advocacy regarding electric and gas wholesale market operations and transactions, and concerning transmission rates.

John has a B.A. from St. John's college, and a J.D. from Hastings College of the Law.

Marketing and Account Services Update
Time-of-Use Transition
Per California Public Utilities Commission regulation, eligible residential customers In the city of Tracy and other areas of the San Joaquin County and Central Valley transitioned to a Time-of-Use rate with peak hours from 4 PM to 9 PM. The opt-out rate of residential customers in Tracy increased by approximately 0.54% between January (base case) and early May (post-transition). Both PG&E and EBCE will provide bill protection to transitioned customers, meaning each entity will reimburse the customer for any increase in actual payments after one year on the rate as compared to what they would have paid on their previous tiered rate.

A similar transition occurred for residential customers in Alameda County in May 2021. PG&E bill protection credits are showing up on applicable customer bills in May. EBCE bill protection credits will appear on customer bills in June.

Renewable 100 Default Transitions
Residential customers in Berkeley and San Leandro transitioned to Renewable 100 in March 2022. We are now over one month out from customer transitions and changes in opt out rates remain below the expected target of 0.50%, as shown in the chart below. The cities of Albany, Hayward, and Pleasanton transitioned all customers to Renewable 100 in January 2022, while the city of Dublin transitioned only residential customers to Renewable 100 in that same month.

New Community Inclusion Update
EBCE staff has completed and presented to Stockton staff the first iteration of Stockton’s electricity data analysis. The initial analysis included the following key results:
• Stockton would add approximately 1.34 terawatt-hours (TWh) to the existing EBCE load of 6.45 TWh.
• Stockton load is “peakier” than EBCE's current load. Diversity in the timing of peaks means that the addition of Stockton would not substantially impact EBCE’s load distribution throughout the year.

CEO Report Item 11
• In 2021, EBCE’s “Bright Choice” product would have theoretically reduced Stockton customer expenditures by $1.49M and increased renewable consumption by at least 6% (80 GWh or enough to power 15,700 homes for a year)
• EBCE CEO and staff met with Stockton’s City Manager on May 11. The initial analysis was well received and EBCE staff is working with the City of Stockton staff on next steps Staff Report Item 13
Staff Report Item 13
TO: East Bay Community Energy Board of Directors
FROM: Melissa Brandt, Vice President of Public Policy & Deputy General Counsel SUBJECT: Approval of Legislative Positions (Action Item) DATE: May 18, 2022
__________________________________________________________________ Recommendation
Take a “support” position on Assembly Bill (“AB”) AB 2765 (Santiago), take a “support if amended” position on Senate Bill (“SB”) 1020 (Laird), and move to a neutral position on AB 2070 (Bauer-Kahan).

Background and Discussion
At the April 20, 2022, EBCE Board Meeting, the Board decided to watch AB 2765.

Subsequently, the Senate Working Group on Climate Change introduced SB 1020. Both bills address concerns about electric ratepayer rate increases and bill affordability by using newly created funds to pay for certain electric programs with broad public benefit using taxpayer revenue. The goal is to mitigate electric ratepayers’ rising rates, particularly since income taxes in California are regressive and electric rates are regressive. While CARE and FERA programs help the lowest-income customers, hardest hit are often the low-income customers just above the CARE/FERA eligibility threshold, who on average have a higher number of residents living in one household compared to middle income households, energy inefficient housing (often rentals), and correspondingly high electric bills. These customers are burdened with the high cost of housing in the Bay Area and its surrounds, coupled with high electricity bills on account of their high volumetric usage. They receive no relief if their incomes exceed the CARE/FERA thresholds which are very low versus the cost of living in the Bay Area, as CARE/FERA eligibility is based on a multiplier of the Federal Poverty Index. In addition to the regressive cost impact on customers (and associated expected customer disconnections), high electric rates are a disincentive to vehicle and building electrification, as they make fuel switching from gas to electric more expensive.

Staff Report Item 13
Also at the April 20, 2022, EBCE Board Meeting, at the recommendation of Staff the Board decided to support AB 2070. However, AB 2070 has since been amended to no longer include the language that led EBCE to recommend taking a support position.

Specifically, the language requiring a notification to the fire protection district when the utility initiates a deenergization event has been struck, likely due to concerns that the requirement may conflict with existing California Public Utilities Commission (CPUC) notice mandates. While taking no position on the broader public policy merits of the bill as amended, the bill is no longer directly relevant to EBCE’s interests or legislative principles, making a neutral position appropriate.

Recommended EBCE Bill Positions:
• SUPPORT: AB 2765 (Santiago) would establish a taxpayer-funded Public Utilities Public Purpose Programs Fund and would require the CPUC to use the fund to pay for programs currently funded through an electrical corporation’s public purpose program rate component except for the California Alternate Rates for Energy (CARE) program, and other programs determined by the CPUC to provide public benefits. If the fund does not have sufficient moneys for those purposes, the bill would authorize the CPUC to permit electrical corporations to recover the costs of those programs from ratepayers, as they do today through a charge on electric service, which is collected through customer delivery rates. The CPUC must consider the continuity of the public purpose programs and minimize customer disruptions. This bill would lower the electric delivery rates for all customers including EBCE customers, helping both with customer bill affordability and lower service disconnection rates, and supporting the growth of electrification by keeping electricity costs competitive. This aligns with EBCE’s legislative principle of accelerating decarbonization through electrification, as well as promoting local development through incentivizing transportation and building electrification.

It would further align with our policy position on Disadvantaged Communities by supporting rate relief for our low-income customers. • SUPPORT IF AMENDED: SB 1020 (Laird) would set interim targets for serving load with 100% renewable/zero-carbon energy by 2045: 90% by end-2035, 95% by end-2040, and 100% for state agencies by 2030. Given EBCE’s goal of 100% clean energy by 2030, staff expects to exceed these interim targets and supporting the targets for others aligns with our legislative principle of accelerating decarbonization.

While state agencies can meet their 100% obligation through their load-serving entity’s purchases, the purchases on behalf of state agencies are subject to a number of requirements including that the resource be newly developed and that the compliance obligations be separate from other load the entity serves.

These requirements would not allow EBCE to simply serve its state agency load with its Renewable 100 product; rather, EBCE would have to maintain a separate procurement portfolio for its state agency load. This would be Staff Report Item 13
unnecessarily bureaucratic, expensive, and risky. EBCE staff recommends seeking amendments to the state agency procurement requirements so that EBCE could enable any state agency load to satisfy its 100% clean energy requirements simply by enrolling in EBCE’s Renewable 100 product.

SB 1020 additionally creates the Climate and Equity Trust Fund, to be administered by a new nonprofit benefit corporation, the California Affordable Decarbonization Authority. The Trust Fund would support the costs of decarbonization, clean energy, and wildfire mitigation activities with funding sources outside of electricity rates. The CPUC would approve the disbursement of funds from the Trust Fund for eligible costs, including disbursements to CCAs such as EBCE. The Trust Fund would consist of federal funds, state legislative appropriations, Greenhouse Gas Reduction Funds, noncompliance penalties, and any other sources identified by the legislature. Disbursements would be made as direct credits on ratepayer bills, direct rebates or incentives, or reimbursement of eligible costs incurred by load-serving entities in the form of matching funds. In order to ensure that there is no competitive disadvantage to CCAs who only have generation revenues, EBCE staff recommends seeking amendments to ensure that eligible costs incurred by load-serving entities may be reimbursed in full, not only as matching funds.

If amended as suggested, this bill has the potential to lower the electric delivery rates for all customers including EBCE customers, helping both with customer bill affordability and lower service disconnection rates, and supporting the growth of electrification by keeping electricity costs competitive. This aligns with EBCE’s legislative principle of accelerating decarbonization through electrification, as well as promoting local development through incentivizing transportation and building electrification.

It would further align with our policy position on Disadvantaged Communities by supporting rate relief for our low-income customers. • MOVE TO NEUTRAL: AB 2070 (Bauer-Kahan) would require an electrical corporation or local publicly owned electric utility to notify a fire protection district at least 24 hours before performing scheduled, nonemergency hot work, deploying a safety and infrastructure protection team, or performing a prescribed or controlled burn within the district’s jurisdiction. Bauer-Kahan is a member of EBCE’s legislative delegation. The bill was amended before EBCE formally communicated its support position, so moving to neutral would mean that EBCE would simply remove its support position from its website and would not communicate a formal position to the author or committees.

Fiscal Impact
AB 2765 and SB 1020 may result in lower customer utility delivery charges.

Attachments:

Staff Report Item 13
A. Author Fact Sheets: AB 2765 and SB 1020
B. Presentation

Page 1 of 2 ends

Status: Assembly Appropriations Committee | Last updated: 4.28.22 Bill Summary
AB 2765 would sunset some Public Purpose
Program (PPP) surcharges on utility customers
and continue the programs with funding from
the State’s General Fund to continue
supporting low-income consumers and help
meet California’s climate goals.

Existing Law
Establishes energy efficiency, cost saving, and
rate assistance programs to help reduce energy
costs for consumers (Public Utilities Code
Section 381, 399.4, 739.1, 739.3; Public
Resources Code Section 25710).

Background
Electric rates continue to increase dramatically
in California. Inflation is hitting goods across
the board, and the economic impacts of the
pandemic and the Russian invasion of Ukraine
are causing financial challenges for many
Californians, especially at the gas pump and on
their utility bills.

California’s PPP includes cost-effective energy
efficiency, conservation, and rate assistance
programs to help meet the state’s climate goals
and subsidize energy costs for low-income
consumers. Electric customers in investor-owned utility (IOU) territories pay for these state-mandated public benefits programs
through a surcharge on their utility bill.

Although the PPP is, in part, meant to provide
discounts on utility bills for low-income
households, not all low-income households
benefit from the utility discounts. Some low-income residential customers do not qualify for PPP low-income assistance programs, such as
the California Alternate Rates for Energy (CARE)
and Family Electric Rate Assistance (FERA)
programs. These households are effectively
low-income, don’t benefit from utility relief,
and still have to pay into the programs through
a monthly surcharge on their utility bill. PPP
surcharges for programs such as the School
Energy Efficiency Stimulus Program help
California reach its climate goals, but do not
directly benefit the low-income residential
customer.

Need for AB 2765
In California, high electric bills are hitting low-income households hard. Their utility bills are saturated with various add-on costs that don’t
actually reflect the cost of supplying electricity.

These add-ons include subsidies for clean
energy and EV charging stations, climate
change adaptation costs, and more.

One of the best ways to help the working poor
is by reducing their utility bills and taking some
of these costs out of electricity prices to make
them more closely reflect their true social cost.

Attachment Staff Report Item 13A

Page 2 of 2 ends

Status: Assembly Appropriations Committee | Last updated: 4.28.22 Since the PPP’s climate benefits accrue to
everyone in California, it is more appropriate
for all taxpayers to fund these programs, not
just a subset of electric customers.

Furthermore, if all taxpayers paid for the PPP,
then electric customers would pay lower utility
bills, especially low-income households. For
example, as of January 1, 2022, if the public
purpose program costs considered in AB 2765
were removed from San Diego Gas & Electric’s
electric rates, system average rates would be
about 2.6% lower.

To ensure that the cost of the PPP is equitably
distributed, AB 2765 would sunset some of the
PPP surcharges on utility customers and
continue the programs with funding from the
State’s General Fund, thus reducing the cost of
utility bills for low-income utility customers
experiencing rising energy costs and equitably
distributing the costs of achieving California’s
climate goals.

Support
Coalition of California Utility Employees
California State Association of Electrical
Workers
San Diego Gas & Electric Company
Opposition
None on File.

For More Information
Tom Steel, Legislative Aide
Office of Assembly Member Santiago
(916) 319-2053 | [email protected]
Attachment Staff Report Item 13A
Provides Greater Specificity to SB 100 Targets and Establishes New State Agency leadership in Clean Energy. The bill does the following:

1. Adds 90% by 2035 and 95% by 2040 interim zero carbon electric sector targets to the existing SB 100 framework.
• Existing law requires that all Load Serving Entities procure at least 60% of retail sales from renewable generation by 2030 and 100% of retail sales from zero carbon resources by 2045. – The definition of “renewable generation” is based on eligibility rules under the Renewable Portfolio Standard (RPS) program.
– The definition of “zero carbon resources” is more expansive and includes generation eligible under the RPS ` plus other non-emitting technologies such as nuclear and large hydroelectric generation. – State agencies have not yet aligned on a formal definition of “zero carbon” for purposes of SB 100 compliance.

This bill would not provide any additional guidance relating to this definition. • The California Public Utilities Commission (CPUC) recently adopted Integrated Resource Planning goals intended to result in 86% zero carbon resources serving customer loads by 2032. These goals apply to all Investor-Owned Utilities (IOUs), Community Choice Aggregators, and Electric Service Providers. • The two largest Publicly Owned Utilities (POUs) have committed to achieve the SB 100 targets on an accelerated basis.
– The Los Angeles Department of Water and Power plans to rely on 100% zero carbon electricity by 2035. – The Sacramento Municipal Utility District is committed to 100% zero carbon electricity by 2030.

2. Require all state agencies to purchase 100% zero carbon electricity to serve their own needs by 2030. • Applies to all electricity serving state agency facilities or operations. – Under existing law (SB 100), state agencies are required to meet the 100% zero carbon electricity target by 2045. • State agencies that are customers of a Load Serving Entity (IOUs, Community Choice Aggregator, or POUs) may comply in either of the following ways:
– Installation of behind the meter zero carbon generation on owned or leased buildings. – Purchase of newly developed zero carbon resources through their Load Serving Entity. • For the State Water Project (approximately 70% of total state agency electricity consumption), compliance via procurement of new zero carbon resources by the Department of Water Resources (DWR). – DWR currently procures electricity on behalf of the State Water Project and projects that approximately 70% of total needs will be served with zero carbon generation by the end of 2022. Absent any acceleration, DWR forecasts that contribution of zero carbon resources will be 75% by 2030. • SB 1020 requires procurement of new zero carbon resources to serve state agency needs give preference to resource options expected to yield maximum long-term employment, stimulate new economic activity, generate local and state tax revenues, and assist with the development of new industries.

SB
1020 Clean Energy, Jobs and
Affordability Act of 2022
(Laird, Caballero, Durazo and Atkins)

4.18.22 Attachment Staff Report Item 13A
Establishes the Climate and Equity Trust

1. Climate and Equity Trust fund
• Establishes a separate trust fund outside of the state budget to ensure the integrity of all funds deposited into the account. • The source of trust funds may be from the federal government, the Greenhouse Gas Reduction Fund (GGRF), state legislative appropriations, mitigation fees, noncompliance penalties assessed by the California Energy Commission (CEC)/CPUC/California Air Resources Board (CARB) and any other sources identified by the Legislature. • Legislature must separately identify and authorize specific funding sources. – New long-term funding streams required to provide meaningful benefits. – Potential funding options include new mitigation fees, budget surplus, and a climate bond. • Annual and multi-year spending plans/disbursements authorized by CPUC and CEC. • Trust funds can be used for any of the following costs included in retail electricity rates (depending upon funding source):
– Transportation/building electrification initiatives.
– Public Purpose Programs (including energy efficiency, research and development, and low-income customer discounts).
– Programs to promote equity and affordability for low-income customers. – Wildfire Mitigation Costs.
– Other decarbonization programs.
– Distributed Energy Resource subsidies.
• Annual funding needs vary by objective and beneficiaries:
– Approximately $5 billion to reduce rates for all retail customers by 2 cents/kilowatt hour (kWh) (includes IOUs and POUs).
– Approximately $1.75 billion to reduce residential customer rates by 2 cents/kWh. – Approximately $450 million to reduce low-income customer rates by 2 cents/kWh. • Allowable methods of disbursement:
– Direct credits to retail customer bills (via IOU/POU billing). – Direct rebates/incentives to market participants, vendors, installers or customers. – Reimbursement of eligible costs incurred by a Load Serving Entity in the form of matching funds.

2. Establishment of California Affordable Decarbonization Authority (CADA) to administer the Trust fund. • Non-profit public benefit corporation with a board appointed by the Governor and Legislature. • Regulated by the CEC (for disbursements to customers of POUs) and CPUC (for disbursements to customers of IOUs, Community Choice Aggregators and Electric Service Providers). • Subject to Bagley-Keene open meeting requirements and the California Public Records Act. • Submits annual and multi-year spending plans for review/approval by CPUC and CEC, including reasonable overhead and operations costs.

Coordinates State Agencies to Support Informed Transmission Planning

1. Authorizes the CPUC and CEC to disclose confidential information to the California Independent System Operator (CAISO) relating to power purchase agreements to assist with transmission planning. • Clarifies that sharing of confidential information does not constitute a waiver of confidentiality under the Public Records Act.
• Purpose it to assist CAISO with its transmission planning process by allowing review of relevant details of contractual agreements for new resources.
• This change to state law was recommended by the CPUC, CEC, CARB and CAISO in a September 2021 report.1 – The Joint Agencies found that, absent a statutory change, legal barriers currently prevent the CPUC and CEC from sharing confidential information with the CAISO without waiving protections for market sensitive information.

1. Report to the Governor on Priority SB 100 Actions to Accelerate the Transition to Carbon-Free Energy issued jointly by the CPUC, CEC, CARB and CAISO (September 2021), pages 10-11, 26.

Attachment Staff Report Item 13A
Legislative
Update
MAY 18, 2022
Attachment Staff Report Item 13B
Legislative Highlights
• New Recommended Bill Positions: AB 2765, SB 1020, AB 2070 Attachment Staff Report Item 13B
Key Deadlines for the 2022 Legislative Year
• 1/3: Legislature reconvened
• 1/10: Governor submitted budget
• 1/31: Deadline to move 2-year bills out of 1st house
• 2/18: Bill introduction deadline
• 4/29: Policy cmtes to move fiscal bills to fiscal cmtes (1st house) • 5/6: Policy cmtes to move nonfiscal bills to floor (1st house) • 5/20: Fiscal cmtes must move bills to floor (1st house) • 5/27: Last day for bills to be passed out of 1st house • 6/15: Budget bill must be passed
• 7/1: Policy cmtes to meet and report bills (2nd house) • 8/12: Fiscal cmtes to move bills to floor (2nd house) • 8/31: Last day for each house to pass bills
• 9/30: Last day for Governor to sign/veto bills
Attachment Staff Report Item 13B
Recommended Bill Positions
Bill # Author Description Sponsor Status
Recommended
EBCE Position
AB 2765 Santiago
Creates a new taxpayer-funded fund to cover the costs of CPUC Public Purpose Programs including energy efficiency and conservation, and arrearage management, instead of continuing to rely on customer delivery rates. Reverts to utility ratepayers if fund isn’t sufficiently funded by the legislature. Excludes CARE/FERA.

Sempra Asm Approps
Cmte

SUPPORT
SB 1020 Laird
Sets interim targets for meeting renewable/zero-carbon goals: 90% by end-2035, 95% by end-2040; 100% for state agencies by 2030.

State agencies can comply through their LSE, but LSE procurement for the state agency must meet certain criteria. Establishes new fund to support the costs of decarbonization, clean energy, and wildfire mitigation activities with funding sources outside of electricity rates.

Establishes new nonprofit public benefit corporation to administer the fund.

Senate
Climate
Change
Working
Group
Sen Approps
Suspense File

SUPPORT IF

AMENDED
AB 2070 Bauer-Kahan
Requires an electrical corporation or local publicly owned electric utility to notify the fire protection district 24+ hours before performing scheduled, nonemergency hot work, deploying a safety and infrastructure protection team, or performing a prescribed or controlled burn, or else face a $500 penalty.

Asm Approps
Cmte NEUTRAL (formerly

SUPPORT)
Attachment Staff Report Item 13B
Funding Programs Through Taxes Instead of Rates
5 What is being proposed?
• Fund the costs of public purpose programs or other broad societal benefit programs with a fund using state tax revenues instead of electric utility rates What does it accomplish?
• Supports SB 100/electrification goals by reducing the rate of utility bill increases to prevent reaching a threshold where electrification is disincentivized • Social policy program costs are paid for in a more progressive way, reducing the burden on lower-income customers
Estimated Costs
• EBCE’s estimate: Current public purpose program including CARE is ~ $2.7B/year Attachment Staff Report Item 13B
Why is it important? Equity.
6 • Customers who are not CARE/FERA-eligible but
nevertheless lower-income are paying as much as
customers who have higher incomes – this
regressive rate structure lies in stark contrast to
state taxes which are progressive
• When EBCE has expanded its customers’ program
eligibility for its own electrification programs
using Area Mean Income (AMI) instead of Federal
Poverty Level (FPL), it has resulted in an increase
in eligibility – these customers are struggling the
most to bear the cost of utility rates today
Utility rates are not equitable
Attachment Staff Report Item 13B
Why is it important? Electrification.
7 Electric rates need to stay below a threshold to incentivize fuel-switching to electric • Goal is to prevent electric rates from
reaching a point that discourages
electrification
• Gas/EV charging station signage
example: Electric rates need be lower
than gas or people won’t buy EVs
Attachment Staff Report Item 13B
Bill Tracker - Assembly
Bill # Author Description Sponsor Status
EBCE
Position
AB 1814 Grayson Authorizes CCAs to file applications for PUC programs and investments to accelerate widespread transportation electrification. CalCCA Author withdrawn SUPPORT
AB 1960 Villapudua
Encourages the Senate and the Governor to consider permanent residents of northern, southern and the central valley regions of the state to provide more regional diversity among CPUC commissioners.

Sen EUC
Cmte SUPPORT
AB 2061 Ting
Requires data disclosure on EV charging station availability for stations using public or ratepayer money and requires the CEC to assess reliability and equitable access issues.

Flo Asm Approps
Cmte 5/11
AB 2667 Friedman
Establishes and requires CEC to administer state IDER Fund to incentivize eligible resources to support consumer adoption of clean DERs, creates a system to equitably award incentives, and establishes a process to allow an LSE to apply for incentives on behalf of a customer as part of that LSE's program to reduce its RA obligations.

NRG / EDF Asm Approps
Cmte 5/11 SUPPORT
AB 2700 McCarty
Requires IOUs and POUs to ensure that their distribution systems are upgraded to support the state’s anticipated level of EV charging; requires the CPUC to develop an expedited process to ensure that IOUs can meet the requirements to upgrade, and to direct IOUs to expedite interconnection; requires CARB to share fleet data to inform electrical grid planning and requires CEC to forecast distribution needs for DERs.

Asm Approps
Cmte 5/11
AB 2703 Muratsuchi Establishes reliability standards for ZEV refueling/charging stations. Asm Approps Cmte 5/11
Attachment Staff Report Item 13B
Bill Tracker - Senate
Bill # Author Description Sponsor Status
EBCE
Position
SB 45 Portantino Requires Dept of Res Recycling and Recovery to analyze progress in achieving organic waste reduction goals and assist local jurisdictions with funding to comply.

Asm Nat Res
Cmte
SB 833 Dodd
Community Energy Resiliency Act of 2022: requires the CEC to develop and implement a grant program for local govts to develop community energy resilience plans and expedite permit review of DERs.

The Climate
Center
Sen Approps
Suspense File
SB 881 Min Gives CPUC authority to monitor compliance with LSE's IRP GHG emission reductions and penalties/CPUC-ordered procurement for non-compliance. UCS Sen Approps Cmte 5/16
SB 1112 Becker
Requires energy suppliers (including CCAs) offering decarb programs to record a decarb charge notice, then notice of full cost recovery, then notice of charge removal with the project's county.

Sen Approps
Suspense File SUPPORT
SB 1158 Becker
Changes the Power Source Disclosure rules to require utilities and CCAs to report comparisons of their energy and capacity purchases with their electricity demand on an hourly basis including the associated GHG emissions.

Sen Approps
Cmte 5/16
SB 1393 Archuleta Requires local jurisdictions to consider CEC guidance before mandating that retrofits to a bldg. must upgrade fossil appliances to electric and to file records with CEC.

Sen Approps
Suspense File OPPOSE
SB 1482 Allen Requires mandatory building standards for installation of EV charging infrastructure for parking spaces in new multifamily units. Acterra Sen Approps Suspense File
Attachment Staff Report Item 13B
Next Steps
• Review and analyze new amendments
• Monitor bills on our watch list; determine when EBCE should formally take a position
• Send position letters for bills once EBCE formally takes a position
• Monitor Governor’s Budget request, which includes $6.1B over 5 years for Zero Emission Vehicles (ZEV)
• Engage with CalCCA on legislative efforts
Attachment Staff Report Item 13B
Staff Report Item 14
Staff Report Item 14
TO: East Bay Community Energy Board of Supervisors
FROM: Nick Chaset, CEO
SUBJECT: Draft EBCE Budget Fiscal Year 2022-2023 (Informational Item) DATE: May 18, 2022
________________________________________________________________________ Recommendation
Receive and review the draft budget for fiscal year 2022-2023.

Background and Discussion
EBCE’s fiscal year is from July 1 through June 30. Staff is presenting a proposed draft budget for fiscal year 2022-2023.

This budget presents changes to EBCE’s value proposition by recommending an increase from 1% to 3% discount relative to PG&E rates for EBCE’s Bright Choice product and decreasing the premium of the Renewable 100 product from $0.01 to $0.0075.

This budget also presents a large net position surplus as a base-case scenario. Staff is recommending a method to manage this surplus to increase EBCE’s value to the community through four processes:

1. Significant contributions to working capital and reserves to ensure agency solvency in the event of possible risk contingencies

2. Increase value proposition customer discount and establish on-bill credits as levels of net position surplus are realized through the year

3. Increase renewable procurement with short and long-term investments

4. Meaningful increases to Local Development programs and donation of a local public health grant to treat a common ailment of fossil fuel combustion—asthma.

This presented budget is based on feedback from a draft version presented at the Finance, Administrative, and Procurement Committee on April 15, 2022. The budget outlines staff’s best expected estimates for costs and revenues anticipated for the next fiscal year based on load, market prices, and PCIA charges.

Staff Report Item 14
Summary of Draft EBCE Budget FY 2022-2023
FY 2022-23 FY 2021-22 FY 2021-22
DRAFT BUDGET BUDGET YTD* + EST

OPERATING ACTIVITY

EXPENSES & OTHER USES
Energy Operating Expenses
Cost of Energy 565,675,000 442,337,000 463,253,000
Energy Operating Services 11,262,000 12,240,000 11,478,000 Total Energy Operating Expenses 576,937,000 454,577,000 474,731,000 Overhead Operating Expenses
Personnel 15,712,000 10,171,000 8,204,000
Marketing & Communications 2,876,000 1,686,000 1,294,000 Legal, Policy, & Regulatory Affairs 1,988,000 1,592,000 1,173,000 Other Professional Services 2,292,000 850,000 901,000
General & Administrative 3,884,000 2,961,000 2,465,000
Depreciation 180,000 60,000 59,000
Total Overhead Operating Expenses 26,932,000 17,320,000 14,096,000 Total Operating Expenses 603,869,000 471,897,000 488,827,000

NON-OPERATING ACTIVITY
Total Non-Operating Revenue 277,000 1,692,000 2,649,000

RESERVE BALANCE
Beginning Reserve Balance TBD 90,218,000 90,218,000
# Operating Target (50%) 323,955,000 243,385,000 253,364,000 Staff Report Item 14
Fiscal Impact
This establishes the forecast of EBCE’s fiscal position for the next 12 months with a positive net position.

Attachments
A. Presentation of the Draft EBCE Budget FY 2022-2023
Draft Budget Review for
Fiscal Year 2022-2023
MAY 18, 2022
PRESENTED BY:

NICK CHASET, CEO
Attachment Staff Report Item 14A
2 Executive Summary
• In the face of rising energy costs, EBCE is able to continue to serve our local community and customers with cost competitive & cleaner energy while providing local jobs and equitable programs.
• Rates are up and PCIA is down, driven by a historic increase in market energy prices starting in 2021 and forecasted to persist in 2022-2023.
• With EBCE rates indexed to PG&E rates, we are forecasting significant headroom to operate and a strong financial surplus, helping to offset calendar 2021, which operated at a loss. • Draft budget includes the following:
o Significant contributions to working capital and reserves o Improvements to the Value Proposition (increased discount and bill credits) o Increased renewables procurement (short-term and new long-term investments) o Meaningful increase to local development budget and local public health grant o Expand on staff expertise, build more depth, and scale operations further o Investment in EBCE's new headquarters in a downtown Oakland DAC Attachment Staff Report Item 14A
3 Summary Draft Budget for Fiscal Year 2021-2022
Notes:

YTD* reflects actuals through March 31, 2022
Net Position through FY March 31, 2022: ($22.8MM)
FY 2022-23 FY 2021-22 FY 2021-22
DRAFT BUDGET BUDGET YTD* + EST

OPERATING ACTIVITY

REVENUE & OTHER SOURCES
GASB 62 Unrecognized Revenue Balance 15,814,000 15,814,000 15,814,000 Total Operating Revenue 871,290,000 499,697,000 548,771,000

EXPENSES & OTHER USES
Total Energy Operating Expenses 576,937,000 454,577,000 474,731,000 Total Overhead Operating Expenses 26,932,000 17,320,000 14,096,000 Total Operating Expenses 603,869,000 471,897,000 488,827,000

NET OPERATING POSITION

NON-OPERATING ACTIVITY
Total Non-Operating Revenue 277,000 1,692,000 2,649,000 Total Non-Operating Expenses 44,040,000 14,873,000 17,901,000 NET NON-OPERATING ACTIVITY (43,763,000) (13,181,000) (15,252,000) TOTAL REVENUES 871,567,000 501,389,000 551,420,000
TOTAL EXPENSES 647,909,000 486,770,000 506,728,000
NET INCREASE(DECREASE) IN POSITION 223,658,000 14,619,000 44,692,000

RESERVE BALANCE
Beginning Reserve Balance TBD 90,218,000 90,218,000
# Operating Target (50%) 323,955,000 243,385,000 253,364,000 Attachment Staff Report Item 14A
4 Draft Budget Base Case Assumptions
Revenues
• Increase to customer value proposition by
o Bright Choice from 1% to 3% discount to PG&E
o R100 from $0.01 to $0.0075 above PG&E
o Estimated revenue reduction of $18.6MM
• $50 bill credit applied to all CARE & FERA customers in Q1/Q2 of FY 22-
23, totaling an estimated $6.25MM in one time bill
savings
• Assumes current rates and PCIA are unchanged
through 2022
• Rates and PCIA for 2023 are non-stressed, or as
forecasted, energy rates
• 2.0% uncollectable rate
• No recognition of GASB 62 revenue ($15,814,000)
• Non-operating revenue assumes 0.25% interest
earned on treasury backed cash balance accounts
Energy Costs
• Costs are derived from a blend of contracted and
open positions for all energy, attributes, and RA
o Open prices are non-stressed, or as forecasted
• Renewable Energy has additional 5% above recent
board approved calendar 2022 and 2023 Bright
Choice targets.
o 2022: Renewables 45% --> 50%; CF 63% --> 68%
o 2023: Renewables 49% --> 54%; CF 66% --> 71%
o Adds $3.3MM to costs (Each 1% is ~$667,000)
Other Costs
• Additional staffing requirements of 19 FTE
• New building use date assumed in January 2023
o $7MM capital improvement costs
• Program funding increased by 143% to $20.6MM
• $15MM for UCSF Children’s Hospital Grant
Attachment Staff Report Item 14A
5 Draft Budget Proposed Surplus Allocations
Net Position Estimated at $223.7MM
Proposed Budget Surplus Waterfall Allocation:
1) Working Capital Needs: $50MM*
2) Reserve Account Funding: $75MM*
3) 50/50% split of any excess to:**
o Incremental Long-Term Renewable Energy/Clean Energy Storage Investments: ~$50MM o One-time On-Bill Credits to Customers: ~$50MM
*Allocations to be made after the end of the fiscal period ending June 30, 2023 **Assuming a budget surplus that is materially consistent with this forecast, staff would plan for an even allocation. Formal action would be brought forth to the board in Q3 of the fiscal year (Jan-Mar 2023) to formally adopt in conjunction with a mid-year budget update. This timing would allow for staff to have good visibility into calendar 2023 rates and forecasted surplus.

Attachment Staff Report Item 14A
6 Energy Price Risk Scenarios
• In a rising energy cost environment, indexing to PG&E rates, creates more headroom for EBCE to operate.

However, in addition to customer energy costs increasing, it increases EBCE energy costs, reserve requirements, and general operating risk
• In a low energy price environment, indexing to PG&E rates, reduces headroom for EBCE to operate. Customer energy costs are going down and EBCE faces considerable competitive rate pressure. • From a budgeting perspective, a mismatch of forecast and actuals presents considerable risk:
• Scenario 1: Rate forecasts are low and actual energy prices are high o Hedges perform well but open position is costly
o Rates/PCIA will adjust favorably next year but we have a very significant working capital drain bc rates may not be sufficient to cover energy costs, creating near-term liquidity risk. • Scenario 2: Rate forecasts are high and actual energy prices go down o Hedges perform poorly but open position is at a low cost o Rates/PCIA will adjust unfavorably next year. Near term liquidity and net position are strong, but we have to reserve for future corrections due to overcollections.

Attachment Staff Report Item 14A
7 Draft Budget Energy/Rate/PCIA Scenarios
• While no forecast proves to be fully reliable, EBCE evaluates a number of short and long-term forward price curves through 3rd parties and further computationally simulates risk on multiple curves. The curves reflect a variety of renewable generation, storage adoption, climate, and policy scenarios. • The current base case draft budget is based on forward energy costs over the fiscal period averaging at $78.39 • If prices were to decrease approximately to simulated P5 levels, which average to $55.52, the forecasted net position would reduce by about $154.2MM
• If prices were to increase to simulated P95 levels, which average to $126.40, the forecasted net position would increase by about $63.1MM
• Under a highly stressed scenario, if rates and PCIA were set at the forecasted P5 scenario, but then actualize at P95 actuals, the estimated net position could go as low as much as negative $135.2MM Base P5 P95 Stress
Net Revenues 871,290,000 614,622,000 1,036,589,000 614,622,000 Energy Costs 565,675,000 463,173,000 667,830,000 667,830,000 All Other Costs 81,957,000 81,957,000 81,957,000 81,957,000 Net Position 223,658,000 69,492,000 286,802,000 (135,165,000) Attachment Staff Report Item 14A
8 Energy Prices and Risk Bands (P5-P95)
Attachment Staff Report Item 14A
9 Draft Budget Operating Revenues
• Increase to value proposition
o Bright Choice from 1% to 3% discount to PG&E
o Renewable 100 from $0.01 to $0.0075 above PG&E
o $50 bill credit to all CARE & FERA customers in July-Sept 2022, shown as Other Operations Revenue reduction
• Assumes current rates and PCIA are unchanged through 2022 • Rates and PCIA for 2023 are non-stressed, or as expected, energy rates • 2.0% uncollectable rate
• No recognition of GASB 62 revenue ($15,814,000)
• Current Year Other Operations Revenue is CAPP payments FY 2022-23 FY 2021-22 FY 2021-22
DRAFT BUDGET BUDGET YTD* + EST

REVENUE & OTHER SOURCES
GASB 62 Unrecognized Revenue Balance 15,814,000 15,814,000 15,814,000 Operating Revenue
Electricity Sales 895,427,000 508,636,000 551,368,000
Uncollectables (17,908,000) (8,939,000) (10,045,000)
Other Operations Revenue (6,229,000) 0 7,448,000
Total Operating Revenue 871,290,000 499,697,000 548,771,000 Attachment Staff Report Item 14A
10 COMPARISON OF CCA RATES OVER TIME
CCA 2020 2021 2022
2022
w/new value
proposition
EBCE -1.00% -1.00% -1.00% -3.00%
MCE Clean Energy 2.94% 18.30% -12.69%
CleanPowerSF -1.00% 2.25% 0.00%
San Jose Clean Energy -1.00% -0.25% 0.00%
Clean Power Alliance 3.99% 18.41% 22.59%
CCA 2020 2021 2022
2022
w/new value
proposition
EBCE 8.51% 9.13% 6.79% 4.85%
MCE Clean Energy 10.96% 27.06% -5.90%
CleanPowerSF 7.51% 11.38% 6.79%
San Jose Clean Energy 7.51% 8.69% 8.00%
Clean Power Alliance 23.98% 28.68% 22.52%
Base Product comparison to IOU for prominent
residential rate
100% Renewable Energy Product comparison to IOU for
prominent residential rate
Attachment Staff Report Item 14A
11 Value Proposition Changes
• The proposed changes to the value proposition are intended to:
o Establish a discount rate that is sustainable through future market cycles, which is essential in establishing a clear and consistent value proposition to our customers o Prioritize CARE/FERA customer with pre-emptive bill credits ($6.25MM immediate savings) o Cautious fiscal management by ensure a budget surplus before issuing a more expansive customer-wide bill credit
Change in Value Proposition Relative to PG&E
Bright Choice Discount Customer Savings (MM) Renewable 100 Premium Customer Savings (MM) Total Savings (MM) 1% $7.10 $0.0075 $4.40 $11.50
2% $14.20 $0.0050 $8.80 $23.00
3% $21.30 $0.0025 $13.20 $34.50
4% $28.40 $0.0000 $17.60 $46.00
Attachment Staff Report Item 14A
12 Draft Budget Energy Expenses
Energy Costs
• Costs are derived from a blend of contracted and open positions for all energy, attributes, and RA
o Open prices are non-stressed, or as forecasted
o FY 22/23 are 30% higher than FY 21/22 on
average
• Renewable Energy has additional 5% above recent
board approved calendar 2022 and 2023 Bright Choice
targets.
o 2022: Renewables 45% --> 50%; CF 63% --> 68%
o 2023: Renewables 49% --> 54%; CF 66% --> 71%
o Adds $3.2MM to costs (Each 1% is ~$620,000)
• Note: We are in a period of historically high energy
pricing and significant uncertainty/volatility
o Forecasted market energy costs in 2022 and
2023 are approximately double the historical 12-
year average
FY 2022-23 FY 2021-22 FY 2021-22
DRAFT BUDGET BUDGET YTD* + EST
Energy Operating Expenses
Cost of Energy 565,675,000 442,337,000 463,253,000
Data Management/Customer Service 7,847,000 8,645,000 8,002,000 PG&E Service Fees (Billing/Metering) 2,719,000 2,752,000 2,712,000 CAISO Scheduling Coordinator 696,000 843,000 764,000
Energy Operating Services 11,262,000 12,240,000 11,478,000 Total Energy Operating Expenses 576,937,000 454,577,000 474,731,000 Attachment Staff Report Item 14A
13 Draft Budget Overhead Expenses
• Personnel costs will be discussed more in-depth on the next slide • Increase in Marketing costs is Local Development marketing activity needs • Increase in Legal, Policy , & Regulatory affairs is due to a couple of factors o Possible membership expansion (Stockton)
o Additional volume of consulting/vendor agreements and power contracts • Larger staffing demand, from Personnel costs, increases in Professional Services with HR/recruiting and additional project support
• Increase to G&A is primarily driven by expected increase operating expenses related to the new building
• Depreciation increases due to new building use expected in January, 2023 FY 2022-23 FY 2021-22 FY 2021-22
DRAFT BUDGET BUDGET YTD* + EST
Overhead Operating Expenses
Personnel 15,712,000 10,171,000 8,204,000
Marketing & Communications 2,876,000 1,686,000 1,294,000 Legal, Policy, & Regulatory Affairs 1,988,000 1,592,000 1,173,000 Other Professional Services 2,292,000 850,000 901,000
General & Administrative 3,884,000 2,961,000 2,465,000
Depreciation 180,000 60,000 59,000
Total Overhead Operating Expenses 26,932,000 17,320,000 14,096,000 Attachment Staff Report Item 14A
14 Draft Budget Overhead Expenses—Personnel
• FY 2020-21 Budget was established at 37 FTE
o No COLA was allocated that fiscal year
o Personnel transitions left vacancies
• FY 2021-22 Budget was initially approved at 43 FTE and expanded mid-year to 49 o 2.5% COLA and up to 5% merit-based/promotional compensation allotted o Currently at 45 FTE and interviewing for an additional 4 roles • FY 2022-23 Budget seeks to increase to 68 FTE to accommodate additional work requirements in all areas. Additional headcount will expand on internal expertise/skills, build more depth, and scale operations:
o 3.5% COLA and up to 10% merit-based/promotional compensation pool o 5 Marketing, 4 Local Programs, 3 Operations, 3 Technology, 2 Power Resources, 2 Legal FY 2022-23 FY 2021-22 FY 2021-22
DRAFT BUDGET BUDGET YTD* + EST
Salaries & Wages 11,598,000 7,058,000 6,468,000
Retirement 1,544,000 993,000 879,000
Health Care/Benefits 2,292,000 1,196,000 614,000
Payroll Expenses 277,000 174,000 131,000
Total 15,711,000 9,421,000 8,092,000
Attachment Staff Report Item 14A
15 Draft Budget Overhead Expenses—Marketing &
Account Services
• Data Manager: Change orders to data management system, reduced through contract negotiations this year
• Required Mailings: Joint Rate Mailer w/ PG&E, Power Content Label, New Account Noticing
• Advertising: Active community presence activities, sponsorships, local events • Promotional Items: Give away items
• Communications: Public relations, media, newsletters, consultants, minor software needs (like for website maintenance and updates)
• $1.4MM of the $2.9MM is Local Development Marketing needs and is distributed across the categories
FY 2022-23 FY 2021-22 FY 2021-22
DRAFT BUDGET BUDGET YTD* + EST
Data Manager 100,000 185,000 65,000
Required Mailings 520,000 395,000 515,000
Advertising 986,000 569,000 497,000
Promotional Items 25,000 10,000 23,000
Communications 1,233,000 455,000 386,000
Total 2,864,000 1,614,000 1,486,000
Attachment Staff Report Item 14A
16 Draft Budget Overhead Expenses—Legal, Policy, &
Regulatory Affairs
• Legal Consultants: Outside general counsel for procurement, analysis, and general operations
• Legislative Consultants: Retainer for Weideman Group legislative advocacy • Other Consultants: Economic analysis in regulatory and legislative cases and communications consultant
• Sponsorships & Memberships: Occasional sponsorships for policy related events and Bar dues
FY 2022-23 FY 2021-22 FY 2021-22
DRAFT BUDGET BUDGET YTD* + EST
Legal Consultants 1,635,000 1,315,000 1,315,000
Legislative Consultants 132,000 132,000 132,000
Other Consultants 144,000 120,000 105,000
Sponsorships & Memberships 75,000 25,000 25,000
Total 1,986,000 1,592,000 1,577,000
Attachment Staff Report Item 14A
17 Draft Budget Overhead Expenses—Other Professional
Services
• Accounting: Accounting and auditing for financial compliance • Human Resources Consulting: Support for additional HR demand for increased staffing recruitment, professional development, and training • IT Consulting: Technical network assistance
• Other Consultants: Technical consulting for Power Resources and Technology & Analytics; as well as operational compliance support and other various tasks FY 2022-23 FY 2021-22 FY 2021-22
DRAFT BUDGET BUDGET YTD* + EST
Accounting 265,000 250,000 258,000
Human Resources Consulting 1,000,000 100,000 33,000
IT Consulting 75,000 40,000 68,000
Consultants 953,000 460,000 444,000
Total 2,293,000 850,000 803,000
Attachment Staff Report Item 14A
18 Draft Budget Overhead Expenses—General & Administrative • Operational Expenses: Service fees, supplies, membership dues, operational services, and other relevant G&A
• New Building Expenses: Expected costs to operating within the new building, such as general maintenance, insurance requirements, and additional stocking materials • Software, Subscriptions, SaaS: Increase covers additional software needs for Power Resource and Technology operations, as well as essential subscriptions for ongoing operations • Rent & Utilities: Decrease because paying rent for only part of year, but expect some increase in utilities with new building space
• Conferences & Professional Development: Trainings, conferences, and related expenses • Board & Director Fees: Monthly stipends for board members FY 2022-23 FY 2021-22 FY 2021-22
DRAFT BUDGET BUDGET YTD* + EST
Operational Expenses 1,048,000 877,000 818,000
Software, Subscriptions, SaaS 2,099,000 1,406,000 1,297,000 Small Equipment 210,000 107,000 56,000
Rent & Utilties 330,000 471,000 521,000
Conferences & Prof. Development 130,000 40,000 29,000
Board & Director Fees 65,000 60,000 40,000
Total 3,882,000 2,961,000 2,761,000
Attachment Staff Report Item 14A
19 Draft Budget Non-Operating Activity
• Non-Operational Revenue: Interest earned on Treasury backed cash account balances (estimated at 0.25%) and BlocPower loan (5.5% on $1.0MM)
• Other Non-Operational Revenue: SaaS services provided to SVCE • Borrowing Interest Expenses: Expected costs associated with expanded credit facility • Local Development Funding: Capital transfer to Local Development Fund • Grant: Proposed grant to UCSF Benioff Oakland Children’s Hospital for EBCE Pediatric Asthma partnership
• Capital Expenditures: New building improvement costs to allow for use FY 2022-23 FY 2021-22 FY 2021-22
DRAFT BUDGET BUDGET YTD* + EST

NON-OPERATING REVENUE
Interest Income 262,000 798,000 150,000
Grants 0 894,000 2,173,000
Other Non-Operating Revenue 15,000 0 326,000
Total Non-Operating Revenue 277,000 1,692,000 2,649,000

NON-OPERATING EXPENSES
Borrowing Interest 1,440,000 898,000 907,000
Local Development Funding 20,600,000 8,475,000 8,475,000 Grant 15,000,000 0 0
Capital Expenditures 7,000,000 5,500,000 8,519,000
Total Non-Operating Expenses 44,040,000 14,873,000 17,901,000 NET NON-OPERATING ACTIVITY (43,763,000) (13,181,000) (15,252,000) Attachment Staff Report Item 14A
The Problem: Across the communities EBCE serves, a staggering 18% of children suffer from asthma – 33% above the statewide average. The highest rates (up to 21% in Ashland and Cherryland) are concentrated along the 880 and 580 corridors. In West Oakland, 1 in 2 new cases of pediatric asthma is attributable to high levels of air pollution from fossil fuel combustion in cars and trucks.

Why EBCE: Since our founding, addressing the legacy of fossil fuel pollution has been one our foundational goals. EBCE has invested tens of millions into new, local clean energy projects – from wind turbines to rooftop solar + storage to electric vehicle to mitigate pollution. And now is the right time to consider other opportunities to systematically address the effects of air pollution on our most vulnerable neighbors.

The Opportunity: Partner with UCSF Benioff Children’s Hospital Oakland (BCH Oakland) – the East Bay’s only Children’s Hospital – to invest $15M to fund the development of a world class pediatric asthma program focused on serving children across the East Bay (and beyond) Grant to Establish a World Class Pediatric Asthma
Program to Serve the East Bay
Attachment Staff Report Item 14A
Through the creation of the East Bay Community Energy Asthma Program, UCSF Benioff Children’s Hospital Oakland will secure the staff, equipment and spaces needed to reach deep into our community and provide underserved families with world-class asthma care and education.

More specifically, the program will:
• More powerfully connect BCH Oakland’s existing asthma care delivery channels – including the Pulmonology Clinic, primary care, inpatient care, emergency department and new allergy services – into a well-coordinated and easily accessible program that connects families with more preventative and timely treatment services.
• Provide patients with access to the social workers, mental health care providers and patient navigators they need to effectively manage their condition.
• Expand education and community outreach, including through local schools and local primary care providers, to connect patients to better care and additional management resources. • Prioritize prevention through BCH Oakland’s multi-disciplinary team, by pre-empting common triggers such as allergies and mental health challenges.

Grant to Establish a World Class Pediatric
Asthma Program to Serve the East Bay
Attachment Staff Report Item 14A
Grant to Establish a World Class Pediatric
Asthma Program to Serve the East Bay
This investment will also endow the East Bay Community Energy Distinguished Professorship in Asthma.

This endowed professorship would allow UCSF Benioff Children’s Hospitals to appoint a nationally recognized physician scientist to play a leadership role in the East Bay Community Energy Asthma Program.

Specifically, the Distinguished Professor will:
• Collaborate with leading experts from across UCSF’s pulmonology, allergy and immunology divisions to conduct research focused on improving outcomes for children with asthma across the East Bay. • Conduct research in underexplored priority areas. The exact focus will depend on the physician scientist appointed/recruited. Possible areas of investigation may include the association and interaction of asthma and sickle cell disease; and how environment, stress and genetics contribute to the higher rates and worse outcomes of Black children affected by asthma.

Next Steps: If the East Bay Community Energy Board of Directors approves the allocation of funding towards this new initiative, EBCE staff will engage with UCSF Children’s Hospital Oakland to develop a detailed proposal and associated grant agreement that will be brought back to the Board for review and approval at some point in 2022 (or 2023 at the latest).

Attachment Staff Report Item 14A
23 Draft Budget: Local Development Fund
• 2022-2023 Local Development budget set at
$20.6M
• Allocating budget for capital
intensive infrastructure development
projects
• Allocating EBCE capital to reduce cost of
ownership for building and vehicle
electrification
• Initiating programs to accelerate heavy and
light duty vehicle adoption as well as
eMobility
• Increased funding for Community Grants
• $1.4M in Program marketing in the MAS
budget
• Unspent Local Development
budget carries forward year to year
FY 2022-23 FY 2021-22 FY 2020-21 FY 2019-2020
BEGINNING BALANCE 13,470,962 10,067,572 4,870,737 0

REVENUE & OTHER SOURCES
Transfer from Operating Fund 20,600,000 8,475,000 6,340,000 6,275,000 Grants/Credits - - 395,000 -
Total Revenues & Other Sources 20,600,000 8,475,000 6,735,000 6,275,000

EXPENSES & OTHER USES
Actual Program Expenses - 1,571,610 1,538,165 1,404,263 Expected Remaing Expenses 34,070,962 3,500,000 - -
Total Expenses & Other Uses 34,070,962 5,071,610 1,538,165 1,404,263 ENDING BALANCE - 13,470,962 10,067,572 4,870,737
Local Development Areas of Emphasis Budget Allocation
Transportation Electrification $12.75M
Building Electrification $4.7M
Energy Efficiency No Direct EBCE Cost
Community Resilience/Local RE $660k
Community Grants $2.25M (granted over 3 years)
Sponsorships/Memberships $250k
Attachment Staff Report Item 14A
Transportation Electrification
24 • Transportation is the largest source of emissions of GHG and particulate matter from Light, Medium and Heavy-duty vehicles
• EBCE is developing publicly available charging infrastructure tailored to renters and low-income communities to ensure these residents can transition to EVs (currently developing the first 3 charging hubs)
• Goods movement is particularly important with Port impacts to communities and access through the territory and into the Central Valley
• EBCE will continue assisting Cities to electrify fleets; providing fleet electrification technical assistance and offering to develop and operate charging infrastructure for Cities with "Charging as a Service" product
• With more vehicle models becoming available EBCE will develop programs to facilitate the buying process and make EVs accessible across all customer income levels • Partner with local agencies and local business to increase access to eMobility solutions • Provide capital to reduce cost of ownership through credit enhancements across multiple vehicle classes Attachment Staff Report Item 14A
Charging Infrastructure Deployment
25 Development Capital for Charging Infrastructure
• Equitable Public Fast Charging Hubs($3M)
• Funds to support EBCEs efforts to build a network of public fast chargers across the communities we serve with an emphasis on siting these chargers close to high densities of multi-family housing where home charging is often not accessible
• Medium/Heavy Duty Charging Station pilot ($1M)
• Funds to support investments in fast chargers infrastructure to support goods movement electrification with an emphasis supporting electrification of trucking and drayage • Municipal Fleet Charging as a Service Projects ($2M)
• Funds to support municipal fleet electrification through provision of Charging as a Service Fleet Technical Assistance
• Municipal Fleet TA ($250k)
• M/H Duty Fleet TA ($500k)
Attachment Staff Report Item 14A
Electric Vehicle and eMobility Innovation Fund
26 Invest in vehicle adoption and eMobility
• Lower costs and improve experience to accelerate EV adoption with emphasis on access for low and moderate income consumers ($2M)
• Funds to support one or more projects to drive consumer adoption of EVs. Ex: supporting electrification of rideshare services to direct consumer leasing/purchase of EVs • Heavy duty loan loss reserve / credit enhancement to reduce barriers to electric Drayage ownership ($2M)
• Funds to support one or more projects to directly support conversion of older diesel drayage to all electric • Partner with local transit agencies and local businesses to increase access to microMobility and eMobility solutions ($2M)
• Funds to support one or more projects to increase access to electric microMobility/eMobility The specific details of each of these initiatives are under development and will be brought to the Board as they are ready to implement
Attachment Staff Report Item 14A
Community Resilience
27 Continue to deploy Energy Resilient Public Facilities across EBCE communities
• Independent Engineer for Phase 2 Municipal Critical Facility Projects ($500k) • EBCE PPA development and negotiation for Phase 1 Procurement ($100k) • Salesforce PPA billing capability ($60k)
Phase 1 Update: EBCE is finalizing the Phase 1 portfolio of projects and will be issuing RFO for Resilience projects in June. Initiating Phase 2 enrollment with other Cities to build on Phase 1 success and deliver more resilience across the community.

Attachment Staff Report Item 14A
Energy Efficiency
28 Launch and run CPUC Funded Energy Efficiency Program • Launch Commercial pay for Performance Program Pending approval of EBCE AL • 3-year Program budget of $13.5M ($4.5M/year)
• Expected CPUC Approval July/August
• Planned program launch within 6 months of CPUC approval • Incentives paid on measured, cost-effective savings
• Higher payments during peak periods
• Program will target combined demand response and energy efficiency installations Commercial P4P Pilot learnings: Pilot program over-subscribed, incentives to be paid 12 months after project completion. Implementors awaiting additional EE funds.

Attachment Staff Report Item 14A
Building Electrification
29 Electrifying buildings is key to meeting climate action plans and improving indoor air quality.

LMI Electrification
• Year 2 of BlocPower funding commitment ($650k)
• Scaling BlocPower program upon phase 1 success ($500k) Clean Cooking with Induction
• Induction lending Program - ($200k)
• EBCE HQ Clean Cooking Demonstration Center - ($500k)
• Local point of sale partnership for residential adoption ($200k) • Commercial electrification Technical Assistance ($150k) Accelerating Building Electrification
• Municipal Electrification TA ($250k)
• Building Electrification Credit enhancement ($2M)
• BE Workforce Development ($250k)
Attachment Staff Report Item 14A
Community Grants
30 EBCE will continue working with community-based organizations and local businesses to deliver benefits across the EBCE service area
• Community Grants ($2.25M over 3 years)
Funding
Category
Transportation
Electrification
Building
Electrification
Community
Resilience
Energy
Efficiency
Program
Enrollment
Workforce
Development
Education /
Awareness
• Staff will work with BOD
and CAC to determine
funding priorities and
manage grants
Attachment Staff Report Item 14A
Thank You!
@PoweredbyEBCE
[email protected]
31 Questions? Give us a call:
1-833-699-EBCE (3223)
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Attachment Staff Report Item 14A
Staff Report Item 15
Staff Report Item 15
TO: East Bay Community Energy Board of Directors
FROM: Howard Chang, Chief Operating Officer
SUBJECT: Energy Prepay Transaction #2 Request for Approval (Action Item) DATE: May 18, 2022
__________________________________________________________________ Recommendation
Adopt a Resolution authorizing the execution of a Power Supply Contract and certain other documents to enable EBCE to enter into its second energy prepayment transaction.

Background and Discussion
In 2021, EBCE successfully executed its first 30-year energy prepay transaction for renewable and carbon free energy with an associated bond transaction issued through the California Community Choice Finance Authority (CCCFA). This was the first energy prepay transaction by a CCA. Beginning on January 1, 2022 energy began to flow through that transaction, with EBCE realizing over $2MM in annual savings as a result. These savings allow for EBCE to utilize its tax-exempt status to lower our overall procurement costs. EBCE is preparing to execute a second prepay transaction, largely replicating the first transaction. One distinct change in this second transaction is that EBCE will be executing this as an individual CCA, whereas the initial transaction was done jointly with SVCE.

With these energy prepay transactions EBCE will assign in existing and/or forthcoming Power Purchase Agreements (PPAs). Based on the number of eligible source specified PPAs that EBCE will seek to continue to execute on additional prepay transactions in the coming years to maximize the available savings. This second transaction is expected to be a 30-year transaction. Following EBCE board approval, we will seek CCCFA approval. We anticipate being fully enabled with documents prepared so that we are able to go out to market in the June timeframe. The actual issuance of bonds and closing of the transaction will be dependent on market conditions and the necessary interest rate spreads.

Prepay Parties:

The prepay transaction requires the selection and involvement of multiple parties. Names and functions are as follows:

Prepay Buyer: East Bay Community Energy
Staff Report Item 15
• Role: Provide energy contracts to flow through prepay and receive discount Prepay Supplier and Bond Underwriter: Morgan Stanley
• Role: Structure transaction and pay contract price to PPA provider • Selection Process: via solicitation issued by EBCE in November 2019 Municipal Advisor: PFM
• Role: Advise Prepay Buyer in negotiations; required by Municipal Securities Rulemaking Board (MSRB)
• Selection Process: via solicitation issued by EBCE in September 2020 Bond Counsel: Orrick, Herrington & Sutcliffe
• Role: Represent bondholders
• Selection Process: via solicitation issued by EBCE in June 2020 Tax Counsel: Orrick, Herrington & Sutcliffe
• Role: Provide tax opinion on transaction
• Selection Process: via solicitation issued by EBCE in June 2020 Issuer’s Counsel: Chapman and Cutler LLP
• Role: Represent issuer’s interests, supporting drafting and negotiating terms of prepay agreement and associated energy supply agreements
• Selection Process: via solicitation issued by EBCE in June 2020 Disclosure Counsel: Chapman and Cutler LLP
• Role: Prepare Official Statement
• Selection Process: via solicitation issued by EBCE in June 2020 Bond Issuer: California Community Choice Financing Authority (CCCFA) • Role: Issue municipal bonds for prepay
• Selection Process: via JPA formation - EBCE membership approved April 2021, executed June 2021
Custodian: Bank of New York
• Role: Manage the various Payment Accounts
• Selection Process: via solicitation issued in July 2021 Commodity Swap Counterparty: Natixis
• Role: Provide commodity swap for any periods with floating/indexed power prices • Selection Process: via solicitation issued by Morgan Stanley in April 2022. The swap counterparty is the one role that is being transitioned to a new party due to pricing improvements and to diversify the number of counterparties providing this service.

Credit Rating Agency: Moody’s
• Role: Rate the bonds
• Selection Process: based on an evaluation of the limited providers in the market and chosen due to accepted market standards
Prepay Documents:

The prepay transaction requires the preparation of numerous documents. Below are the key documents (all included as attachments to this item):

Power Supply Contract
• Function: Sets forth terms for which CCA receives energy for 30-year term • Signed by: EBCE and Issuer (CCCFA)
Letter Agreement Regarding PPA Assignments
Staff Report Item 15
• Function: Details the terms of the limited assignment of PPAs between EBCE and third-party energy sellers • Signed by: EBCE and Prepay Supplier (Morgan Stanley)
Form of Limited Assignment
• Function: Signed for each PPA assigned into prepay; Exhibit to “Letter Agreement Regarding PPA Assignments”
• Signed by: EBCE, Original PPA Counterparty, and Prepay Supplier (Morgan Stanley) Project Administration Agreement
• Function: Sets out terms for CCA to act on behalf of the Issuer • Signed by: EBCE and Issuer (CCCFA)
PPA Payments Custodial Agreement
• Function: Details cash flows between PPA Buyer (CCA), Prepay Supplier, and Custodian • Signed by: EBCE, Prepay Supplier (Morgan Stanley), and custodian Trust Indenture
• Function: Sets forth terms of bond issuance and rights of bondholders • Signed by: Issuer (CCCFA) and trustee (BONY)
Prepaid Agreement
• Function: Details the flow of power and payments between the Prepay Supplier and the Issuer
• Signed by: Issuer (CCCFA) and Prepay Supplier (Morgan Stanley) Re-pricing Agreement
• Function: Sets forth terms for remarketing and repricing for future bond repricing periods
• Signed by: Issuer (CCCFA) and Prepay Supplier (Morgan Stanley) Preliminary Offering Statement (POS)
• Function: Details parties (including appendix of info on CCA operational history), transaction size and key terms; used to market the bonds • Signed by: Not a signed document
Cost Share Memorandum of Understanding (MOU)
• Function: Details the cost share arrangement with MS to cover rating agency and green bond designation fees and EBCE responsibility to cover costs in place of CCCFA Details of Requested Board Approval
Adopt the Resolution which authorizes EBCE to sign:
• Power Supply Contract with CCCFA (Issuer)
• Letter Agreement Regarding PPA Assignments with Morgan Stanley (Prepay Supplier) • Limited Assignment Agreements with Morgan Stanley (Prepay Supplier) and future PPA sellers
• Project Administration Agreement with CCCFA (Issuer)
• PPA Payments Custodial Agreement with Morgan Stanley and BONY The adoption of the Resolution and the execution of the above documents by the EBCE board would enable EBCE to then seek approval for the transaction by the CCCFA board, further enabling the municipal bond raise required to initiate the prepay and start receiving a discount. The approvals provided shall be subject to the following parameters:

Staff Report Item 15
(a) the Bonds will not be obligations of EBCE, but will be limited obligations of the Issuer payable solely from the revenues and other amounts pledged therefor under the Indenture, including amounts payable by EBCE under the Power Supply Contract; (b) the aggregate principal amount of the Bonds shall not exceed $1,000,000,000 (c) the annual energy savings to EBCE under the Power Supply Contract shall be at least $4.50 per MWh
Previous Background Information:

An energy prepayment is a long-term financial transaction available to municipal utilities and tax-exempt entities such as CCAs that enables a meaningful power procurement cost savings opportunity. This prepay structure has historically been utilized for natural gas procurement and is now being applied towards renewable energy. To date, EBCE, Silicon Valley Clean Energy (SVCE), and MCE have executed prepay transactions and currently a number of other CCAs are also in the process of initiating a similar structure.

Prepay Process:

Utilizing the municipal bond market, a tax-exempt Load Serving Entity (LSE, also called “Prepay Buyer”) and a taxable financial counterparty (bank, called “Prepay Supplier") enter into a 30-year agreement through which the LSE assigns existing power supply contracts (or power purchase agreements, “PPA”) to the Prepay Supplier. The Prepay Supplier pays the contract price to the PPA provider, while the LSE pays the Prepay Supplier at a discounted rate. The discounted rate is agreed upon in the prepay documents and is based in part on the spread between the taxable and tax-exempt bond interest rates. The market availability of this interest rate spread is critical to the savings opportunity available to the LSE.

Tax-exempt bonds are issued by a third-party conduit to raise funds for the prepay transaction. The funds flow from the Issuer to the Prepay Supplier. The LSE does a limited assignment of one or more of their PPAs to the Prepay Supplier. The LSE is required to continue to perform under the contract, while maintaining rights to the electricity and attributes under the PPA. The Prepay Supplier utilizes the bond funds and provides a discount on the PPA to the LSE based on the spread between the taxable and tax-exempt rates. The discount is historically estimated at 8-12% but is subject to change based on market conditions at bond re-issuance. For this prepay, the initial discount target is 10% and the minimum discount will likely be set around 6-7%. The typical bond tenors are in the 7-10 year range, so there will be a reissuance and reset of the discount several times throughout the life of the 30-year prepay. There is a negotiated minimum discount over the life of the transaction that, if not met by the Prepay Supplier, allows the LSE a walkaway right.

The total combined notional value of the assigned contracts flowing through the prepay over the 30 years will likely be no greater than $1.25bn; these contracts can be long-term renewables PPAs or other source specified commodity supply contracts, such as large hydro.

The contracts are a limited assignment to the Prepay Supplier and the LSE continues to ultimately take and pay for all the energy and attributes delivered through the contract; all other terms of the PPA remain unchanged. If the prepay program terminates early for any reason – either the Prepay Supplier or the LSE fail to perform – the LSE forgoes future savings and the assigned PPA is put back completely to the LSE.

Financial Impact
Staff Report Item 15
The purpose of pursuing the prepay transaction is to achieve meaningful energy procurement cost savings. This transaction is targeting a 10% discount at the outset, which translates to $2- 3MM of annual savings.

The majority of fees paid to various parties involved in the prepay will be payable from the proceeds of the prepay bonds. That is to say, there is limited out-of-pocket cost to EBCE; the cost will be paid out of the savings realized from the prepay transaction. With that said there are a portion of fees, such as certain counsel fees, rating agency fees, and green bond designation fees that are not contingent. We have negotiated to have MS split these costs with EBCE if the deal does not close. Additionally, we will only move forward in authorizing these fees when necessary.

Additionally, it is important to note that the prepay is non-recourse to EBCE. The ultimate counterparty with the Prepay Supplier is the CCCFA JPA, so CCCFA is therefore the counterparty to all the underlying agreements. CCCFA is a public entity separate and apart from the parties to the JPA Agreement, and the debts, liabilities and obligations of the CCCFA will not constitute debts, liabilities or obligations of EBCE or any representative of EBCE serving on the governing body of EBCE.

Attachments
A. Resolution
B. Presentation
C. Power Supply Contract
D. Letter Agreement Regarding PPA Assignments
E. Form of Limited Assignment
F. Project Administration Agreement
G. PPA Payments Custodial Agreement
H. Trust Indenture
I. Prepaid Agreement
J. Re-pricing Agreement
K. Preliminary Offering Statement
L. Cost Share MOU
Attachment Staff Report Item 15A
RESOLUTION 2022-[__]

A RESOLUTION OF THE BOARD OF DIRECTORS OF THE EAST BAY

COMMUNITY ENERGY AUTHORITY AUTHORIZING THE EXECUTION AND

DELIVERY OF A POWER SUPPLY CONTRACT AND CERTAIN OTHER

DOCUMENTS IN CONNECTION WITH THE ISSUANCE OF THE CALIFORNIA

COMMUNITY CHOICE FINANCING AUTHORITY CLEAN ENERGY
PROJECT REVENUE BONDS, SERIES 2022 EBCE; AND CERTAIN OTHER

ACTIONS IN CONNECTION THEREWITH
WHEREAS, The East Bay Community Energy Authority (“EBCE”) was formed as a community choice aggregation agency (“CCA”) on December 1, 2016, under the Joint Exercise of Power Act, California Government Code sections 6500 et seq. (the “Act”), among the County of Alameda, and the Cities of Albany, Berkeley, Dublin, Emeryville, Fremont, Hayward, Livermore, Piedmont, Oakland, San Leandro, and Union City to study, promote, develop, conduct, operate, and manage energy-related climate change programs in all of the member jurisdictions. The cities of Newark and Pleasanton, located in Alameda County, along with the City of Tracy, located in San Joaquin County, were added as members of EBCE and parties to the Joint Powers Agreement (as defined below) in March of 2020;
WHEREAS, pursuant to the provisions of the Act, EBCE and certain other California “community choice aggregators” entered into a joint powers agreement (the “Joint Powers Agreement”) pursuant to which the California Community Choice Financing Authority (the “Issuer”) was organized for the purpose, among other things, of entering into contracts and issuing bonds to assist EBCE in financing the acquisition of supplies of clean energy;
WHEREAS, the Issuer is authorized by its Joint Powers Agreement to acquire supplies of clean energy by any means and to issue revenue bonds to finance the cost of acquisition of such supplies, and is vested with all powers necessary to accomplish the purposes for which it was created;
WHEREAS, EBCE has determined that it is desireable to acquire a long-term supply of clean energy from the Issuer; WHEREAS, EBCE is requesting that the Issuer agree to purchase certain quantities of clean energy from Morgan Stanley Energy Structuring, L.L.C., a Delaware limited liability company (the “Prepaid Supplier”) on a prepaid basis (the “Project”) and to sell such clean energy to EBCE, as described herein; WHEREAS, EBCE is requesting that the Issuer finance the costs of the Project with the proceeds of its Clean Energy Project Revenue Bonds, Series 2022 EBCE (the “Bonds”);
Attachment Staff Report Item 15A
2 WHEREAS, EBCE has determined to authorize the officers of EBCE to take all necessary action to accomplish the purchase of clean energy from the Issuer and to assist the Issuer in the issuance, sale and delivery of the Bonds; and WHEREAS, there have been made available to the Board of Directors of EBCE for approval forms of the following agreements to which EBCE is a party (collectively, the “EBCE Documents”):

1. Power Supply Contract between EBCE and the Issuer;

2. Custodial Agreement by and among EBCE, Morgan Stanley Capital Group Inc., a Delaware corporation (“MSCG”), the Prepaid Supplier, the Issuer and the custodian to be named therein;

3. Form of Limited Assignment Agreement, by and among EBCE, the counterparty to the power purchase agreement described therein, and MSCG;

4. Letter Agreement among EBCE, the Prepaid Supplier and MSCG regarding matters relating to Assignment Agreements; and

5. Prepaid Energy Project Administration Agreement, by and between EBCE and the Issuer; and

6. Cost Share Memorandum of Understanding (MOU), by and between EBCE, MS, and CCCFA; and
WHEREAS, there have also been made available to the Board of Directors of EBCE forms of the following additional documents relating to the Project:

1. Trust Indenture (the “Indenture”) between the Issuer and the trustee to be named therein, providing for, among other things, the issuance of and security for the Bonds;

2. Prepaid Energy Sales Agreement (the “Prepaid Agreement”) between the Issuer and the Prepaid Supplier, providing for the delivery of the prepaid energy supply to the Issuer;

3. Re-pricing Agreement (the “Re-pricing Agreement”) between the Issuer and the Prepaid Supplier providing for the remarketing or refunding of the Bonds from time to time and the establishment of the Monthly Discount available to EBCE under the Power Supply Agreement from time to time during the term of the transaction; and

4. Preliminary Official Statement (the “Preliminary Official Statement”), to be used in connection with the offering and sale of the Bonds, including the information relating to EBCE included in Appendix A thereto (the Indenture, the Prepaid Agreement, the Re-pricing Agreement and the Preliminary Official Statement, together with the EBCE Documents, the “Project Documents”);
Attachment Staff Report Item 15A
3 NOW THEREFORE, BE IT RESOLVED by the EBCE Board of
Directors, as follows:

Section 1. The proposed forms of the EBCE Documents, as made available to the Board of Directors for this meeting, are hereby approved. The form of Limited Assignment Agreement may be used, in substantially the same form, for the initial assignments of EBCE power purchase agreements, and in a similar form for additional power purchase agreements as needed to maintain the transactions approved hereby, with such changes as may be necessary to conform to the requirements of such power purchase agreement or as may be necessary to effect such assignment, and any such Limited Assignment Agreements shall be included in the EBCE Documents hereby approved.

Subject to the parameters set forth in Section 4 of this Resolution, any of the Chief Executive Officer, Chief Operations Officer or Chair of the Board (each an “Authorized Officer”) is hereby authorized and directed, for and on behalf of EBCE, to execute and deliver the EBCE Documents in substantially said form, with such changes and insertions therein as the Authorized Officer executing the same may approve, such approval to be conclusively evidenced by the execution and delivery thereof.

Section 2. The proposed form of the Preliminary Official Statement, as made available to the Board of Directors for this meeting, is hereby approved. Any Authorized Officer is hereby authorized and directed, for and on behalf of EBCE, to execute and deliver a certificate as to the information regarding EBCE contained therein and in the final version of the Official Statement, with such changes and insertions therein as the Authorized Officer approving the same may deem necessary or appropriate. Subject to approval by the Issuer, EBCE hereby authorizes the distribution of the Preliminary Official Statement to persons who may be interested in the purchase of the Bonds, and the delivery of the Official Statement in final form to the purchasers of the Bonds, in each case with such changes as may be approved as aforesaid.

Section 3. Each Authorized Officer is hereby authorized and directed, for and in the name and on behalf of EBCE, to execute and deliver any and all documents, including, without limitation, any tax certificate relating to its expected use of the energy to be purchased by it from the Project, any continuing disclosure certificate or similar agreement required for the offering or sale of the Bonds, and any and all closing certificates to be executed in connection with the issuance of the Bonds and to take any and all actions which may be necessary or advisable, in the discretion of such Authorized Officers, to effectuate the actions which EBCE has approved in this Resolution, for the issuance, sale and delivery of the Bonds, and to consummate by EBCE the transactions contemplated by the EBCE Documents approved hereby and the other Project Documents presented to the Board herewith, including any subsequent amendments, waivers or consents entered into or given under or in accordance with such documents.

Section 4. The approvals provided for herein shall be subject to the following parameters:
(a) the Bonds will not be obligations of EBCE, but will be limited obligations of the Issuer payable solely from the revenues and other amounts pledged Attachment Staff Report Item 15A
4 therefor under the Indenture, including amounts payable by EBCE under the Power Supply Contract;
(b) the aggregate principal amount of the Bonds shall not exceed $1,000,000,000; and
(c) the annual energy savings to EBCE under the Power Supply Contract shall be at least $4.50 per MWh.

Section 5. Execution and delivery of the EBCE Documents by an Authorized Officer or Officers shall be conclusive evidence that the parameters set forth in Section 4 have been met, and all actions heretofore taken by the Authorized Officers with respect to the issuance of the Bonds are hereby ratified, confirmed and approved.

Section 6. If the conditions set forth in Section 4 have been met, an Authorized Officer may direct the payment to professionals that provided services to EBCE in connection with the Project. These professional services include legal counsel, bond counsel, tax counsel, Municipal Financial Advisor, Swap Advisor, and any other consultant needed to complete the transactions contemplated herein for EBCE. Payment to these professionals will be made from the proceeds of the sale of the Bonds and pursuant to the terms of the applicable agreement executed with EBCE.

Section 7. If the conditions set forth in Section 4 have been met, an Authorized Officer may direct the payment to additional vendors and/or parties to the EBCE Documents or other Project Documents to complete the issuance of the Bonds.

These vendors, if any, will be paid pursuant to an agreement for services rendered in completing the issuance of the Bonds and from the proceeds of the sale of the Bonds.

Section 8. This Resolution shall take effect immediately.

Attachment Staff Report Item 15A
5 ADOPTED AND APPROVED at a regular meeting of the EBCE Board of Directors on this [____] day of [_____], 2022
______________________________________
Dianne Martinez, Chair
Attest:
___________________________________________
Adrian Bankhead, Clerk of the Board
Energy Prepay
Transaction
#2 Request for
Approval
MAY 18, 2022
Attachment Consent Item 15B
Proposed Follow-on Prepay Transaction
● Standalone EBCE Prepay transaction issuing through CA Community Choice Financing Authority (CCCFA), the JPA in which EBCE is a member
● Largely replicating the initial transaction to get to market efficiently. Utilizing the prior RFPs issued/awarded in 2020 and 2021 to renew various counsel and advisory roles. ● Prior transactions required >1.5yrs to complete and targeting 3 to 6 months for the second transaction
● Anticipate $500M to $1bn total size in principal
Next Steps:
● May: Seek EBCE board and CCCFA board approval to transact ● June onwards: Go out to market and determine optimal timing to price ● Taxable vs. tax-exempt spreads have been very volatile with uncertainty as to when conditions will be suitable. With this volatility it is difficult to predict the exact timing for execution of this transaction but may take 3 to 6 months.
2 Attachment Consent Item 15B
Prepay Overview
3 An energy prepayment is a long-term non-recourse financial transaction between a tax-exempt Load Serving Entity (LSE) and a taxable financial counterparty (bank, called “Prepay Supplier") utilizing the municipal bond market. • Municipal utilities (and tax-exempt entities such as CCAs) in the US can prepay for a supply of electricity or natural gas from a taxable entity and fund that prepayment with tax-exempt municipal bonds. • The LSE must sell the commodity to their retail end-users residing within their traditional service area. • This structure is well known and regularly used for gas and is now being applied towards renewables PPAs. Codified in US Tax Law. Since first prepayments of natural gas were done in the early 1990s, the IRS issued rules allowing tax-exempt prepayments and Congress enacted legislation specifically allowing the transactions (National Energy Policy Act of 2005; Section 1327) Structure:
• Term: Typically 30-year term with repricing periods every 5-10 years due to the optimal taxable vs. tax-exempt spreads • Transacting Parties:

1. Tax-exempt Load Serving Entity (LSE, also called “Prepay Buyer”) – EBCE

2. Taxable financial counterparty (bank, called “Prepay Supplier”) - Morgan Stanley • Process:

1. LSE enters into a 30-year power supply arrangement

2. Prepay Supplier is assigned the existing energy supply contract(s) held by LSE through a limited assignment agreement

3. Municipal bonds issued by a conduit, amounting to combined notional value of assigned contracts

4. Prepay Supplier pays the contract price to PPA Seller, immediately transferring all electricity and attributes to LSE

5. LSE pays the Prepay Supplier at discounted rate, achieving procurement cost savings • Takeaway: Prepay Supplier is effectively the energy supplier and is prepaid for future energy deliveries. The Prepay Supplier holds and utilizes capital and provides a discount to the Prepay Buyer that is enabled via the spread between the taxable and tax-exempt borrowing costs.

Attachment Consent Item 15B
Prepay Sizing and Discount
4 • The total bond proceeds may be as high as $1.25bn and will be dependent on the CA bond market appetite. – EBCE will seek the maximum bond raise while maintaining optimal bond rates – The amount represents the present value of the PPA cashflows over the 30-year life of the transaction • This transaction will translate to an estimated $2-3MM of annual savings for EBCE for the initial bond term. – The transaction assumes an increase in the cashflows running through the prepay over the 30-year life. – As the transaction moves forward, the arbitrage value goes down since the present value benefits reduce with a shorter remaining tenor.

The future discount rates will be reset every 5-10 years based on bond tenors and be dependent on future bond market conditions, but this puts downward pressure on the future discounts.
– There is a negotiated minimum discount that, if not met by the Prepay Supplier, allows the LSE not to move forward in the repricing. • Ultimately the discount is established by the spread between taxable and tax-exempt rates and deducts all transaction related costs, which include fees associated with bond underwriting, counsel (bond, disclosure, underwriter’s, prepay), financial adviser, swap counterparty, credit rating, custodian, etc.
• 5-10 years is the optimal bond spread tenor currently. Maintaining this spread over a 30-year transaction life maximizes the available discount. This requires a repricing and re-issuance of bonds every 5-10 years and a reset of the discount rate. In general, a high interest rate environment will lead to a higher discount.
• The initial power flows for the transaction are anticipated to begin in April 2023 Attachment Consent Item 15B
EBCE Prepay Parties
5 Prepay Supplier: Morgan Stanley
– Selected through solicitation issued November 2019
Municipal Financial Advisor: PFM
– Selected through solicitation issued September 2020
Counsel: Orrick, Herrington & Sutcliffe (Bond & Tax Counsel) | Chapman & Cutler LLP (POS, Disclosure & Issuer’s Counsel) – Both firms selected through solicitation issued June 2020 Bond Issuer: California Community Choice Financing Authority – EBCE membership approved by Board in April 2021, JPA formed June 2021; Founding Members are EBCE, MCE, SVCE, 3CE Custodian: BONY
– PFM issued solicitation early July 2021; final selection in process Commodity Swap Counterparty: Natixis
– This is one of the few counterparties that is new to this transaction after going back out to market in April 2022. A new counterparty was selected due to improved pricing and an interest in diversification Credit Rating Agency: Moody's
– Discussions in process
Attachment Consent Item 15B
Documents Overview: EBCE Signs
6 1. Power Supply Contract
– Sets forth terms for which CCA receives energy for 30-year term – Signed by EBCE and CCCFA

2. Letter Agreement Regarding PPA Assignments
– Details the terms of the limited assignment of PPAs between EBCE and 3rd party energy sellers – Signed by EBCE and Morgan Stanley (Prepay Supplier)

3. Form of Limited Assignment
– Details the terms of the limited assignment of each energy PPA EBCE assigns into prepay – Signed by EBCE, the original PPA counterparty, and Morgan Stanley (Prepay Supplier)

4. Project Administration Agreement
– Sets out terms for CCA to act on behalf of the Issuer – Signed by EBCE and CCCFA

5. PPA Payments Custodial Agreement
– Details cash flows between PPA Buyer (CCA), Prepay Supplier, and Custodian – Signed by EBCE, Morgan Stanley, and BONY

6. Cost Share Memorandum of Understanding (MOU)
– Details the cost share arrangement with MS to cover rating agency and green bond designation fees and EBCE responsibility to cover costs in place of CCCFA
Attachment Consent Item 15B
Documents Overview: CCCFA Signs
7 1. Prepaid Agreement
– Details the flow of power and payments between the Prepay Supplier and the Issuer (CCCFA) – Terms are largely mirrored in the Power Supply Contract

2. Re-pricing Agreement
– Sets forth terms for remarketing and repricing for future bond repricing periods

3. Trust Indenture
– Sets forth terms of bond issuance and rights of bondholders – Details that all revenues relevant to transaction flow to and through conduit issuer (CCCFA)

4. Commodity Swap documents
– Docs pursuant to which the commodity price is hedged with a 3rd-party swap counterparty (to insulate transaction from market variations)

5. Parent Guarantee
– Guarantee of “due and punctual payment” from Prepay Supplier to conduit issuer (CCCFA) – Flows in favor of conduit issuer and swap counterparty, respectively

6. Front-End Custodial Agreement
– Outlines payment flows through the transaction, signed by CCCFA, Custodian, and Bond Trustee – Also a Back-End Custodial Agreement which is signed by Morgan Stanley, Custodian, and Bond Trustee Attachment Consent Item 15B
Documents Overview: Other
8 1. Preliminary Offering Statement (POS)
– Official offering document used to market the bonds
– Details parties (including appendix of info on EBCEs operational history), transaction size and key terms – Not a signed document
Attachment Consent Item 15B
Requested Approval
9 • Adopt the Resolution which authorizes EBCE to:
- Sign Power Supply Contractwith CCCFA (Issuer)
- Sign Letter Agreement Regarding PPA Assignmentswith Morgan Stanley (Prepay Supplier) - Sign Limited Assignment Agreementswith Morgan Stanley (Prepay Supplier) and future PPA sellers - Sign Project Administration Agreement with CCCFA (Issuer) - Sign PPA Payments Custodial Agreementwith Morgan Stanley and BONY • The adoption of the Resolution and the execution of the above documents by the EBCE board would enable EBCE to then seek approval for the transaction by the CCCFA board, further enabling the municipal bond raise required to initiate the prepay and start receiving a discount. • The approvals provided shall be subject to the following parameters:
a) the Bonds will not be obligations of EBCE, but will be limited obligations of the Issuer payable solely from the revenues and other amounts pledged therefor under the Indenture, including amounts payable by EBCE under the Power Supply Contract;
b) the aggregate principal amount of the Bonds shall not exceed $1,000,000,000; and c) the annual energy savings to EBCE under the Power Supply Contract shall be at least $4.50 per MWh.

Attachment Consent Item 15B
Appendix
Attachment Consent Item 15B
Existing Prepay Overview
Recap:
● Closed: Sept. 23, 2021
● Total Bond Proceeds: $1.48 Billion
● Rating: A1, “Green Bond” Certified
● Volume to EBCE: 59 MW Around-the-Clock Carbon-Free Energy ● Power Supply Start: January 1, 2022
● Savings, Years 1-10: $2 Million / year
In progress / Ongoing:
● Settlements and invoicing were initiated on January 1, 2022 ● Assessing future PPAs to be put through prepay structure 11 Attachment Consent Item 15B
12 Prepay Structure
Prepay Supplier Municipal
Conduit LSE/CCA
Existing PPA to
be Assigned
Non-Recourse
Tax-Exempt
Bonds
Existing PPA
Counterparty
Contract Price
Prepayment $$
Contract Price
Less Discount
MWhs + RECs MWhs + RECs
+ Debt Service
MWhs + RECs
Debt
Service
Bond
Proceeds
Attachment Consent Item 15B
Market Statistics
13 • Nationwide: 90+ municipal transactions
– $50+ Billion combined notional contract value
• California: 11 municipal transactions
– $5.7 Billion combined notional contract value
• Active Suppliers: Morgan Stanley, Goldman Sachs, Royal Bank of Canada, Citi, TD Securities – All investment grade rated financial institutions
• Resource Types:
– Majority of transactions to date have been exclusively for natural gas, remainder including an electricity ‘switch’ at a certain year.
– The same tax law and similar transaction structure enables the program for electricity from renewables contracts, as well. The market is seeing activity and preparation for these transactions, particularly from CCAs.

Attachment Consent Item 15B
• An energy prepayment is a long-term non-recourse financial transaction between a tax-exempt Load Serving Entity (LSE) and a taxable financial counterparty (bank, called “Prepay Supplier") utilizing the municipal bond market.
o Typically 30-year term, LSE committing ~$350MM-$850MM of energy supply contracts (combined contract notional values)
o LSE utilizes in order to lower customer energy costs
• Prepay Supplier is assigned an existing energy supply contract, pays the contract price to PPA Seller and immediately transfers all electricity and attributes to LSE. LSE pays the Prepay Supplier. • Municipal utilities (and tax-exempt entities such as CCAs) in the US can prepay for a supply of electricity or natural gas from a taxable entity and fund that prepayment with tax-exempt municipal bonds. The LSE must sell the commodity to their retail end-users residing within their traditional service area. o This structure is well known and regularly used for gas and is now being applied towards renewables PPAs o Codified in US Tax Law. Since first prepayments of natural gas were done in the early 1990’s, the IRS issued rules allowing tax-exempt prepayments and Congress enacted legislation specifically allowing the transactions (National Energy Policy Act of 2005; Section 1327) 14 Prepay Overview
Attachment Consent Item 15B
Power Contract Assignment:
• Existing renewable PPAs are assigned to the taxable Prepay Supplier. The LSE continues to take and pay for energy and attributes delivered through the contract.
• All other terms of the PPA are unchanged
• If the prepay program terminates early, prepaid supplier fails to perform, or LSE fails to perform, the LSE forgoes the future savings and the assigned PPA contract is put back to the original LSE • Active Suppliers: Goldman Sachs, Morgan Stanley, Royal Bank of Canada, Citi, Bank of America are all investment grade rated financial institutions
Debt:
• Non-Recourse: Prepays utilize non-recourse municipal bonds and are not secured or guaranteed by the referenced entity (i.e. the CCA). Rather the debt is recourse to the Prepay Supplier (i.e. the bank receiving the prepayment). This significantly protects the CCA and mitigates risk related to the payment of power contracts novated through the prepay.
• Off Balance sheet for LSE: Bonds are issued by a municipal bond conduit and arranged by the Prepay Supplier 15 Key Elements of a Prepay Transaction
Attachment Consent Item 15B
Key Risks
16 • If this transaction does not materialize: Loss of out-of-pocket costs and staff time ‒ Consultants are primarily contingent on successful deal, with the exception of certain counsel fees, rating agency, and green bond designation fees
‒ Consultants are primarily paid from deal proceeds vs. EBCE directly • Opportunity cost of higher savings through a prepay transaction or alternative structure initiated at a different time. ‒ To the extent that MS does not provide the minimum discount EBCE will have a right not to proceed in future repricing periods. Minimum discount will likely be set at around 6-7%. Target initial discount is 10%. ‒ EBCE also has a right to shop the prepay provider if we view that the offered discounts are not at market • Load loss or inability to assign a PPA into the prepay due to contractual limitations would likely lead to remediation or remarketing activities and potentially result in the loss of the discount. ‒ Note that costs would not increase above contractual levels • Regulatory risks, such as reclassifying a long-term PPA as a short-term PPA making it ineligible for SB350 qualification or disruption to PCC1 bundled classification due to the assignment of PPA • Political risk associated with a transaction collapsing due to non-compliance to tax codes Attachment Consent Item 15B
HB Draft 6 May 2022

POWER SUPPLY CONTRACT
between

CALIFORNIA COMMUNITY CHOICE FINANCING AUTHORITY
and

EAST BAY COMMUNITY ENERGY AUTHORITY
Dated as of [____], 2022
Attachment Staff Report Item 15C

TABLE OF CONTENTS
Page
-i-Article I Definitions...................................................................................................................... 2 Section 1.1 Defined Terms ..................................................................................... 2 Section 1.2 Definitions; Interpretation .................................................................. 10 Article II Execution Date and Delivery Period; Nature of Energy Project .......................... 10 Section 2.1 Execution Date; Delivery Period ....................................................... 10 Section 2.2 Termination Due to Failure to Issue Bonds or Provide Minimum Discount ............................................................................ 10 Section 2.3 Nature of Energy Project ................................................................... 10 Section 2.4 Pledge of this Agreement ................................................................... 11 Article III Sale and Purchase .................................................................................................... 11 Section 3.1 Sale and Purchase of Energy .............................................................. 11 Section 3.2 Pricing ................................................................................................ 11 Section 3.3 No Obligation to Take Base Energy .................................................. 11 Section 3.4 Reset Period Remarketing.................................................................. 12 Article IV Failure to Deliver or Take Energy ......................................................................... 13 Article V Transmission and Delivery; Communications ....................................................... 13 Section 5.1 Delivery of Energy ............................................................................. 13 Section 5.2 Scheduling.......................................................................................... 13 Section 5.3 Title and Risk of Loss ........................................................................ 14 Section 5.4 PCC1 Product and Long-Term PCC1 Product .................................. 14 Section 5.5 Deliveries within CAISO or Another Balancing Authority ............... 16 Section 5.6 Assigned Products .............................................................................. 16 Article VI Partial Assignments of PPAs .................................................................................. 17 Section 6.1 Future PPA Assignments ................................................................... 17 Section 6.2 Updates to Exhibits A-1 and A-2 ....................................................... 17 Article VII Use of Energy .......................................................................................................... 17 Section 7.1 Tax Exempt Status of the Bonds ........................................................ 17 Section 7.2 Priority Energy ................................................................................... 17 Section 7.3 Remarketing Sales ............................................................................. 17 Section 7.4 Qualifying Use ................................................................................... 18 Section 7.5 Remediation ....................................................................................... 18 Attachment Staff Report Item 15C

TABLE OF CONTENTS
(continued)
Page
-ii-Article VIII Representations and Warranties; Additional Covenants ................................. 19 Section 8.1 Representations and Warranties of the Parties ................................... 19 Section 8.2 Warranty of Title................................................................................ 20 Section 8.3 Disclaimer of Warranties ................................................................... 20 Section 8.4 Continuing Disclosure ....................................................................... 21 Article IX Taxes ......................................................................................................................... 21 Article X Dispute Resolution..................................................................................................... 21 Section 10.1 Arbitration .......................................................................................... 21 Section 10.2 Judicial Reference. ............................................................................. 22 Article XI Force Majeure .......................................................................................................... 24 Section 11.1 Applicability of Force Majeure .......................................................... 24 Section 11.2 Settlement of Labor Disputes............................................................. 24 Article XII Governmental Rules and Regulations .................................................................. 24 Section 12.1 Compliance with Laws ...................................................................... 24 Section 12.2 Contests .............................................................................................. 24 Section 12.3 Defense of Agreement ....................................................................... 24 Article XIII Assignment ............................................................................................................ 25 Article XIV Payments ................................................................................................................ 25 Section 14.1 Monthly Statements ........................................................................... 25 Section 14.2 Payment.............................................................................................. 26 Section 14.3 Payment of Disputed Amounts; Correction of Index Price ............... 26 Section 14.4 Late Payment ..................................................................................... 27 Section 14.5 Audit; Adjustments ............................................................................ 27 Section 14.6 Netting; No Set-Off............................................................................ 27 Section 14.7 Source of Purchaser’s Payments ........................................................ 27 Section 14.8 Rate Covenant .................................................................................... 27 Section 14.9 Pledge of CCA Revenues................................................................... 28 Section 14.10 Financial Responsibility..................................................................... 28 Article XV [Reserved]................................................................................................................ 28 Article XVI Notices .................................................................................................................... 28 Article XVII Default; Remedies; Termination........................................................................ 29 Attachment Staff Report Item 15C

TABLE OF CONTENTS
(continued)
Page
-iii-Section 17.1 Issuer Default ..................................................................................... 29 Section 17.2 Purchaser Default ............................................................................... 29 Section 17.3 Remedies Upon Default ..................................................................... 30 Section 17.4 Termination of Prepaid Agreement ................................................... 31 Section 17.5 Limitation on Damages ...................................................................... 31 Article XVIII Miscellaneous ..................................................................................................... 32 Section 18.1 Indemnification Procedure ................................................................. 32 Section 18.2 Deliveries ........................................................................................... 32 Section 18.3 Entirety; Amendments ....................................................................... 32 Section 18.4 Governing Law .................................................................................. 33 Section 18.5 Non-Waiver........................................................................................ 33 Section 18.6 Severability ........................................................................................ 33 Section 18.7 Exhibits .............................................................................................. 33 Section 18.8 Winding Up Arrangements ................................................................ 33 Section 18.9 Relationships of Parties...................................................................... 33 Section 18.10 Immunity ............................................................................................ 33 Section 18.11 Rates and Indices ............................................................................... 34 Section 18.12 Limitation of Liability........................................................................ 34 Section 18.13 Counterparts ....................................................................................... 34 Section 18.14 Third Party Beneficiaries; Rights of Trustee ..................................... 34 Section 18.15 Waiver of Defenses ............................................................................ 35 Exhibits
Exhibit A-1 - Base Energy Hourly Quantities
Exhibit A-2 - EPS Energy Period Monthly Quantity
Exhibit B - Notices
Exhibit C - Form of Remarketing Election Notice
Exhibit D - Form of Federal Tax Certificate
Exhibit E - Form of Opinion of Counsel to Purchaser
Exhibit F - Monthly Discount
Exhibit G - Form of Closing Certificate
Exhibit H - Form of Remediation Certificate
Attachment Staff Report Item 15C
1 POWER SUPPLY CONTRACT
This Power Supply Contract (hereinafter “Agreement”) is made and entered into as of [____], 2022 (the “Execution Date”), by and between California Community Choice Financing Authority, a joint powers authority and a public entity of the State of California established pursuant to the provisions of the Joint Exercise of Powers Act (Article 1, Chapter 5, Division 7, Title 1, Section 6500 et seq. of the California Government Code, as amended) (“Issuer”) and East Bay Community Energy Authority, a joint powers authority and a community choice aggregator organized under the Laws of the State of California (“Purchaser”).

W I T N E S S E T H:

WHEREAS, Issuer has planned and developed a project to acquire long-term Energy supplies from Morgan Stanley Energy Structuring, L.L.C. (“MSES”) pursuant to a Prepaid Energy Sales Agreement (as amended, restated, supplemented or otherwise modified from time to time, the “Prepaid Agreement”) to meet a portion of the Energy supply requirements of Purchaser through an energy prepayment project (the “Energy Project”); and WHEREAS, Issuer will finance the prepayment under the Prepaid Agreement, and the other costs of, the Energy Project by issuing the Bonds; and WHEREAS, Purchaser is a joint powers authority organized pursuant to the provisions of Title 1, Division 7, Chapter 5, Article 1 (Section 6500 et seq.) of the California Government Code and a community choice aggregator pursuant to the provisions of Section 366.2 of the California Public Utilities Code with authority to sell electricity to retail electric consumers within its service area; and
WHEREAS, Purchaser is agreeable to purchasing a portion of its Energy requirements from Issuer under the terms and conditions set forth in this Agreement and Issuer is agreeable to selling to Purchaser such supplies of Energy under the terms and conditions set forth in this Agreement; and
WHEREAS, concurrently with the execution of this Agreement, Purchaser has assigned to MSES certain Assigned Rights and Obligations, including the right to receive Assigned Product, which Assigned Product will be delivered to Issuer under the Prepaid Agreement and then resold by Issuer hereunder; and
WHEREAS, as a condition precedent to the effectiveness of the Parties’ obligations under this Agreement, Issuer shall have entered into the Prepaid Agreement and shall have issued the Bonds.

NOW, THEREFORE, in consideration of the premises and mutual covenants set forth in this Agreement and for other good and valuable consideration, the receipt and sufficiency Attachment Staff Report Item 15C
2 of which are hereby acknowledged, Issuer and Purchaser (the “Parties” hereto; each is a “Party”) agree as follows:

ARTICLE I

DEFINITIONS
Section 1.1 Defined Terms. The following terms, when used in this Agreement and identified by the capitalization of the first letter thereof, have the respective meanings set forth below, unless the context otherwise requires:
“Affiliate” means, with respect to either Party, any entity which is a direct or indirect parent or subsidiary of such Party or which directly or indirectly (i) owns or controls such Party, (ii) is owned or controlled by such Party, or (iii) is under common ownership or control with such Party. For purposes of this definition, “control” of an entity means the power, directly or indirectly, either to (a) vote 50% or more of the securities having ordinary voting power for the election of directors or Persons performing similar functions or (b) direct or cause the direction of the management and policies, whether by contract or otherwise. “Agreement” has the meaning specified in the preamble and shall include exhibits, recitals and attachments referenced herein and attached hereto and all amendments, supplements and modifications hereto and thereto.
“Annual Refund” means the annual refund, if any, provided to Purchaser and calculated pursuant to the procedures specified in Section 3.2(c). “Applicable Rating Agencies” means, at any given time, each Rating Agency then rating the Bonds.
“Assigned Delivery Point” has the meaning specified in the applicable Assignment Agreement.
“Assigned Energy” has the meaning specified in the applicable Assignment Agreement; provided that any Assigned Energy shall be EPS Compliant Energy as set forth in the Assignment Letter Agreement.
“Assigned Product” means, as applicable, PCC1 Product, Long-Term PCC1 Product, Assigned Energy, Assigned RECs and any other product included in an Assignment Agreement.
“Assigned RECs” means any RECs to be delivered to MSCG or MSES pursuant to any Assigned Rights and Obligations.
“Assigned Rights and Obligations” means a portion of Purchaser’s rights and obligations under a power purchase agreement assigned pursuant to an Assignment Agreement. “Assignment Agreement” means the Initial Assignment Agreement and any subsequent assignment agreement entered into consistent with the Assignment Letter Agreement.

Attachment Staff Report Item 15C
3 “Assignment Letter Agreement” means that certain Letter Agreement, dated as of the date hereof, by and among MSCG, MSES, Issuer and Purchaser. “Available Discount” means, for each Reset Period, the amount, expressed in cents per MWh (rounded down to the nearest one-half cent), determined by the Calculation Agent pursuant to the Re-Pricing Agreement for such Reset Period. The Available Discount shall equal the sum of the Monthly Discount and any anticipated Annual Refunds for the applicable Reset Period.
“Balancing Authority” has the meaning specified in the CAISO Tariff. “Base Energy” means Firm (LD) Energy.
“Billing Date” has the meaning specified in Section 14.1(b). “Billing Statement” has the meaning specified in Section 14.1(b). “Bond Closing Date” means the first date on which the Bonds are issued pursuant to the Bond Indenture.
“Bond Indenture” means (i) the Trust Indenture to be entered into prior to the commencement of the Delivery Period between Issuer and the Trustee, as supplemented and amended from time to time in accordance with its terms, and (ii) any trust indenture entered into in connection with the commencement of any Interest Rate Period after the initial Interest Rate Period between Issuer and the Trustee containing substantially the same terms as the indenture described in clause (i) and which is intended to replace the indenture described in clause (i) as of the commencement of such Interest Rate Period.
“Bonds” means the bonds issued pursuant to the Bond Indenture. “Business Day” means any day other than (i) a Saturday or Sunday, (ii) a Federal Reserve Bank Holiday, (iii) any other day on which commercial banks in either New York, New York or the State of California are authorized or required by Law to close, or (iv) any other day excluded pursuant to the Bond Indenture.
“CAISO” means California Independent System Operator or its successor. “CAISO Tariff” means CAISO’s FERC-approved tariff, as modified, amended or supplemented from time to time.
“Calculation Agent” has the meaning specified in the Re-Pricing Agreement. “California Long-Term Contracting Requirements” means the long-term contracting requirement set forth in the Clean Energy and Pollution Reduction Act of 2015 (SB 350), California Public Utilities Code section 399.13(b), and CPUC Decision 17-06-026 and CPUC Decision 18-05-026, as may be modified by subsequent decision of the California Public Utilities Commission or by other Law.

Attachment Staff Report Item 15C
4 “CCA Revenues” means all charges received for, and all other income and receipts derived by Purchaser from, the operation of its CCA System, including income derived from the sale of electric energy by its CCA System.
“CCA System” means Purchaser’s community choice aggregation program that provides electric energy supply service to retail customers located with its service area. “Claiming Party” has the meaning specified in Section 11.1. “Claims” means all claims or actions, threatened or filed, that directly or indirectly relate to the indemnities provided herein, and the resulting losses, damages, expenses, attorneys’ fees, experts’ fees, and court costs, whether incurred by settlement or otherwise, and whether such claims or actions are threatened or filed prior to or after the termination of this Agreement. “Code” means the Internal Revenue Code of 1986, as amended. “Commercially Reasonable” or “Commercially Reasonable Efforts” means, with respect to any purchase or sale or other action required to be made, attempted or taken by a Party under this Agreement, such efforts as a reasonably prudent Person would undertake for the protection of its own interest under the conditions affecting such purchase or sale or other action, including without limitation, the amount of notice of the need to take such action, the duration and type of the purchase or sale or other action, the competitive environment in which such purchase or sale or other action occurs, and the risk to the Party required to take such action. “Contract Price” has the meaning specified in Section 3.2(a). “Contract Quantity” means, with respect to each Month during the Delivery Period, (i) the Monthly Quantity of Assigned Energy set forth in Exhibit A-2 for such Month and (ii) the Hourly Quantity of Base Energy set forth in Exhibit A-1 for such Month, as such Exhibits A-1 and A-2 shall be updated from time to time in accordance with Section 6.2. “Day-Ahead Average Price” means, for any Assigned Energy after the Initial EPS Energy Period, (x) the sum of the Day-Ahead Market Prices for each Pricing Interval in a Month divided by (y) the number of Pricing Intervals in such Month; provided that in no case shall the Day-Ahead Average Price hereunder be less than $0.00/MWh. As used in this definition, “Pricing Interval” means the unit of time for which CAISO establishes a separate price. “Day-Ahead Market Price” means The Day Ahead Market or Locational Marginal Price for the Energy Delivery Point for each applicable hour as published by CAISO, or as such price may be corrected or revised from time to time by such independent system operator or other entity in accordance with its rules; provided that in no case shall the Day-Ahead Market Price hereunder be less than $0.00/MWh.
“Default Rate” means, as of any date of determination, the lesser of (a) the sum of (i) the rate of interest per annum quoted in The Wall Street Journal (Eastern Edition) under the “Money Rates” section as the “Prime Rate” for such date of determination, plus (ii) one percent Attachment Staff Report Item 15C
5 per annum, or (b) if a lower maximum rate is imposed by applicable Law, such maximum lawful rate.
“Delivery Hours” means each Hour commencing at 00:00 (PPT) on the first day of the Delivery Period, and each Hour thereafter during the Delivery Period. “Delivery Period” means the period beginning on [____], 2022 and ending on [____], 20[__]; provided that the Delivery Period shall end immediately upon the effective termination date of the Prepaid Agreement or early termination of this Agreement pursuant to Article XVII hereof.
“Delivery Point” means (i) the applicable Assigned Delivery Point(s) for Assigned Energy and (ii) the applicable Energy Delivery Point for Base Energy (as set forth in Exhibits A-1 and A-2). “Energy” means three-phase, 60-cycle alternating current electric energy, expressed in MWhs.
“Energy Delivery Point” has the meaning specified in Exhibit A-1. “Energy Project” has the meaning specified in the recitals. “EPS” means California’s Emissions Performance Standards, as set forth in Sections 8340 and 8341 of the California Public Utilities Code, as implemented and amended from time to time, and any successor Law.
“EPS Compliant Energy” means Energy that Purchaser can contract for and purchase in compliance with EPS requirements that are applicable to Purchaser. “EPS Energy Period” means the Initial EPS Energy Period and any subsequent EPS Energy Period established by a future assignment of a power purchase agreement consistent with the Assignment Letter Agreement.
“Execution Date” has the meaning specified in the preamble. “Federal Tax Certificate” means the executed Federal Tax Certificate delivered by Purchaser in the form attached as Exhibit D.
“FERC” means the Federal Energy Regulatory Commission and any successor thereto.
“Firm (LD)” means, with respect to the obligation to deliver Energy, that either Party shall be relieved of its obligations to sell and deliver or purchase and receive without liability only to the extent that, and for the period during which, such performance is prevented by Force Majeure.
“Force Majeure” means an event or circumstance which prevents one Party from performing its obligations under this Agreement, which event or circumstance was not anticipated Attachment Staff Report Item 15C
6 as of the Execution Date, which is not within the reasonable control of, or the result of the negligence of, the Claiming Party, and which, by the exercise of due diligence, the Claiming Party is unable to overcome or avoid or cause to be avoided. Force Majeure shall not be based on (i) the loss of Purchaser’s markets; (ii) Purchaser’s inability economically to use or resell the Energy purchased hereunder; (iii) the loss or failure of Issuer’s supply except if such loss or failure results from curtailment by a Transmission Provider; or (iv) Issuer’s ability to sell the Energy at a higher price. Neither Party may raise a claim of Force Majeure based in whole or in part on curtailment by a Transmission Provider unless (a) such Party has contracted for firm transmission with such Transmission Provider for the Energy to be delivered to or received at the Delivery Point and (b) such curtailment is due to “force majeure” or “uncontrollable force” or a similar term as defined under the Transmission Provider’s tariff; provided, however, that existence of the foregoing factors shall not be sufficient to conclusively or presumptively prove the existence of Force Majeure absent a showing of other facts and circumstances which in the aggregate with such factors establish that Force Majeure as defined in the first sentence hereof has occurred. Notwithstanding the foregoing or anything to the contrary herein, (I) any invocation of Force Majeure by MSES under the Prepaid Agreement shall constitute Force Majeure in respect of Issuer hereunder; (II) to the extent that a PPA Supplier fails to deliver any Assigned Energy and claims force majeure with respect to such failure to deliver, then such event shall be deemed to constitute Force Majeure in respect of Issuer hereunder; and (III) to the extent that an Assignment Agreement is terminated early, such termination shall constitute Force Majeure with respect to Issuer until the earlier of (A) the commencement of an “Assignment Period” under a replacement Assignment Agreement, (B) the commencement of the delivery of EPS Compliant Energy procured by MSCG consistent with the Assignment Letter Agreement or (C) the end of the second Month following the Month in which such early termination occurs.
“Government Agency” means the United States of America, any state thereof, any municipality, or any local jurisdiction, or any political subdivision of any of the foregoing, including, but not limited to, courts, administrative bodies, departments, commissions, boards, bureaus, agencies, or instrumentalities.
“Hour” means each 60-minute period commencing at 00:00 PPT during the Delivery Period. The term “Hourly” shall be construed accordingly. “Hourly Quantity” means, with respect to each Delivery Hour during the Delivery Period, the quantity (in MWh) of Base Energy set forth on Exhibit A-1 for the Month in which such Delivery Hour occurs (as such Exhibit A-1 may be updated from time to time in accordance with Section 6.2).
“Initial Assigned PPA” means that certain Master Power Purchase and Sale Agreement dated February 12, 2018 and the Confirmation thereunder dated as of the date hereof between the Initial PPA Supplier and Purchaser.
“Initial Assignment Agreement” means that certain Limited Assignment Agreement, dated as of the date hereof, by and among Purchaser, MSES and the Initial PPA Supplier.

Attachment Staff Report Item 15C
7 “Initial EPS Energy Period” means the “Assignment Period” as defined in the Initial Assignment Agreement.
“Initial PPA Supplier” means MSCG.
“Initial Reset Period” means the period beginning on [____], 2022 and ending on [____], 20[__].
“Interest Rate Period” has the meaning specified in the Bond Indenture. “Issuer” has the meaning specified in the preamble.
“Issuer Default” has the meaning specified in Section 17.1. “Law” means any statute, law, rule or regulation or any judicial or administrative interpretation thereof having the effect of the foregoing enacted, promulgated, or issued by a Government Agency whether in effect as of the Execution Date or at any time in the future. “Long-Term PCC1 Product” means bundled renewable energy and RECs meeting the requirements of Portfolio Content Category 1, and the California Long-Term Contracting Requirements, to be delivered to MSCG, MSES or any successors thereto pursuant to any Assigned Rights and Obligations.
“Minimum Discount” means $[____] per MWh for the Initial Rate Period and thereafter no less than $[____] per MWh. Both amounts are inclusive of any projected Annual Refund.
“Month” means, during the Delivery Period, a calendar month. The term “Monthly” shall be construed accordingly.
“Monthly Discount” means (i) for the Initial Reset Period, an amount (when taken together with any Annual Refund) that is not less than the Minimum Discount and is specified in Exhibit F, which Exhibit F shall be provided by Issuer to Purchaser on the Bond Closing Date, and (ii) for each subsequent Reset Period, a portion of the Available Discount for such Reset Period determined by the Calculation Agent pursuant to the Re-Pricing Agreement and set forth in an updated Exhibit F provided by Issuer after such determination. “Monthly Quantity” means, with respect to each Month of the Delivery Period for which, the quantity (in MWh) of Assigned Energy for such Month as set forth on Exhibit A-2 (as such Exhibit A-2 may be updated from time to time in accordance with Section 6.2). “MSCG” means Morgan Stanley Capital Group Inc., a Delaware corporation. “MSES” has the meaning specified in the recitals.
“Municipal Utility” means any Person that (a)(i) is a “governmental person” as defined in the implementing regulations under Section 141 of the Code and any successor provision and owns a natural gas or electric distribution utility (or provides Energy at wholesale Attachment Staff Report Item 15C
8 to, or that is sold to entities that provide natural gas or Energy at wholesale to, governmental Persons that own such utilities) or (ii) is a community choice aggregator organized under the Laws of the State of California, and (b) agrees in writing to use the Energy purchased by it (or cause such as to be used) for a qualifying use as defined in U.S. Treas. Reg. § 1.148-1(e)(2)(iii). “MWh” means megawatt-hour.
“Non-Priority Energy” means Energy that is not Priority Energy. “Party” has the meaning specified in the recitals.
“PCC1 Product” means bundled renewable energy and RECs meeting the requirements of Portfolio Content Category 1 to be delivered to MSCG, MSES or any successors thereto pursuant to any Assigned Rights and Obligations. “Person” means any individual, limited liability company, corporation, partnership, joint venture, trust, unincorporated organization or Government Agency. “Portfolio Content Category 1” means any Renewable Energy Credit associated with the generation of electricity from an “Eligible Renewable Energy Resource” consisting of the portfolio content set forth in California Public Utilities Code Section 399.16(b)(1), as may be amended from time to time or as further defined or supplemented by Law. “Potential Remarketing Event” has the meaning specified in Section 3.4(b). “PPA Supplier” means the Initial PPA Supplier and any subsequent supplier who enters into an Assignment Agreement consistent with the terms of the Assignment Letter Agreement.
“PPT” means Pacific Prevailing Time.
“Prepaid Agreement” has the meaning specified in the recitals. “Priority Energy” means the Contract Quantity to be purchased by Purchaser under this Agreement, together with Energy that Purchaser is obligated to take under a long-term agreement, which Energy either (i) has been purchased by Purchaser or a joint action agency in a prepayment transaction using the proceeds of bonds, notes, or other obligations, the interest on which is excluded from gross income for federal income tax purposes, or (ii) is generated using capacity that was constructed using the proceeds of bonds, notes, or other obligations, the interest on which is excluded from gross income for federal income tax purposes (provided that, with respect to clause (ii), Priority Energy shall not include Energy that is generated using capacity that was wholly or partially financed through the monetization of renewable tax credits, whether such monetization is accomplished through a tax equity investment or otherwise, or that is generated from federally owned and operated hydroelectric facilities, including through the United States Army Corps of Engineers and the United States Bureau of Reclamation, and marketed by the Bonneville Power Administration or the Western Area Power Administration).

Attachment Staff Report Item 15C
9 “Project Administration Fee” means the annual fee payable by Purchaser as described in Section 3.2(b).
“Project Participant” has the meaning specified in the Bond Indenture. “Purchaser” has the meaning specified in the preamble.
“Purchaser Default” has the meaning specified in Section 17.2. “Purchaser’s Statement” has the meaning specified in Section 14.1(a). “Qualifying Use Requirements” means, with respect to any Energy delivered under this Agreement, such Energy is used (i) for a “qualifying use” as defined in U.S. Treas. Reg. §

1.148-1(e)(2)(iii), (ii) in a manner that will not result in any “private business use” within the meaning of Section 141 of the Code, and (iii) in a manner that is consistent with the Federal Tax Certificate attached as Exhibit D.
“Rating Agency” has the meaning specified in the Bond Indenture. “Re-Pricing Agreement” means the Re-Pricing Agreement, dated as of the Bond Closing Date, by and between Issuer and MSES.
“Real-Time Market Price” means The Five Minute Market (FMM) Locational Marginal Price for the Energy Delivery Point for each applicable interval as published by CAISO, or as such price may be corrected or revised from time to time by such independent system operator or other entity in accordance with its rules; provided that in no case shall the Real-Time Market Price hereunder be less than $0.00/MWh.
“Remarketing Election Deadline” means, for any Reset Period, the last date and time by which the Purchaser may provide a Remarketing Election Notice, which shall be 4:00 p.m.

PPT on the 10th day of the Month (or, if such day is not a Business Day, the next succeeding Business Day) prior to the first delivery Month of a Reset Period with respect to which a Potential Remarketing Event has occurred.
“Remarketing Election Notice” has the meaning specified in Section 3.4(b). “Renewable Energy Credit” or “REC” has the meaning specified for “Renewable Energy Credit” in California Public Utilities Code Section 399.12(h), as may be amended from time to time or as further defined or supplemented by Law. “Reset Period” means each “Reset Period” under the Re-Pricing Agreement. “Reset Period Notice” has the meaning specified in Section 3.4(a). “Schedule”, “Scheduled” or “Scheduling” means the actions of Issuer, Purchaser and/or their designated representatives, including each Party’s Transmission Providers, if applicable, of notifying, requesting and confirming to each other the quantity of Energy to be delivered during any given portion of the Delivery Period at a specified Delivery Point.

Attachment Staff Report Item 15C
10 “Transmission Provider(s)” means any entity or entities transmitting or transporting Energy on behalf of Issuer or Purchaser to or from the Delivery Point. “Trustee” means The Bank of New York Mellon Trust Company, N.A., and its successors as Trustee under the Bond Indenture.
“Voided Remarketing Election Notice” has the meaning specified in Section 3.4(b). “WREGIS” means the Western Renewable Energy Generation Information System or its successor.

Section 1.2 Definitions; Interpretation. References to “Articles,” “Sections,” “Schedules” and “Exhibits” shall be to Articles, Sections, Schedules and Exhibits, as the case may be, of this Agreement unless otherwise specifically provided. Section headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement for any other purpose or be given any substantive effect. Any of the terms defined herein may, unless the context otherwise requires, be used in the singular or the plural, depending on the reference. The use herein of the word “include” or “including”, when following any general statement, term or matter, shall not be construed to limit such statement, term or matter to the specific items or matters set forth immediately following such word or to similar items or matters, whether or not nonlimiting language (such as “without limitation” or “but not limited to” or words of similar import) is used with reference thereto, but rather shall be deemed to refer to all other items or matters that fall within the scope of such general statement, term or matter. Any reference herein to any agreement or document includes all amendments, supplements or restatements to and of such agreement or document as may occur from time to time, and any reference to a party to any such agreement includes all successors and assigns of such party thereunder permitted by the terms hereof and thereof.

ARTICLE II
EXECUTION DATE AND DELIVERY PERIOD; NATURE OF ENERGY PROJECT Section 2.1 Execution Date; Delivery Period. Unless this Agreement is terminated pursuant to Article XVII, delivery of Energy under this Agreement shall commence and continue for the Delivery Period.

Section 2.2 Termination Due to Failure to Issue Bonds or Provide Minimum Discount.

Each Party shall have a right to terminate this Agreement with the effect that this Agreement shall be of no further force or effect and the Parties shall have no rights or obligations hereunder if (a) the Bonds are not issued on or before [____], 2022, or (b) Issuer notifies Purchaser that the expected Available Discount for the Initial Reset Period is less than the Minimum Discount.

Section 2.3 Nature of Energy Project. Purchaser acknowledges and agrees that Issuer will meet its obligations to provide Energy to Purchaser under this Agreement exclusively through its purchase of long-term supplies of Energy from MSES pursuant to the Energy Project and that Issuer is financing its purchase of such long-term supplies through the issuance of the Bonds. As provided in Section 3.2(a) below, Purchaser shall pay a fixed price for Energy during the Initial EPS Energy Period and thereafter shall pay a floating price, less the Monthly Discount in each case.

Attachment Staff Report Item 15C
11 Section 2.4 Pledge of this Agreement. Purchaser acknowledges and agrees that Issuer will pledge its right, title, and interest under this Agreement and the revenues to be received under this Agreement (other than revenues attributable to the Project Administration Fee) to secure Issuer’s obligations under the Bond Indenture.

ARTICLE III

SALE AND PURCHASE
Section 3.1 Sale and Purchase of Energy. Issuer agrees to sell and deliver or cause to be delivered to Purchaser, and Purchaser agrees to purchase and take or cause to be taken from Issuer, in each case, on a Firm (LD) basis, the Contract Quantity of Energy pursuant to the terms and conditions set forth in this Agreement.

Section 3.2 Pricing.
(a) For each MWh of Energy delivered to Purchaser, Purchaser shall pay Issuer the applicable Contract Price. With respect to each MWh delivered under this Agreement, “Contract Price” means:
(i) for Assigned Energy during the Initial EPS Energy Period, (A) the Day-Ahead Market Price minus (B) the Monthly Discount; and (ii) for Assigned Energy after the Initial EPS Energy Period, (A) the Day-Ahead Average Price for the Month in which Energy is delivered, minus (B) the Monthly Discount. The Contract Price for Assigned Energy is inclusive of any amounts due in respect of other Assigned Products.
(b) Issuer shall bill and Purchaser shall pay in January of each year during the Delivery Period a “Project Administration Fee” equal to the result of (x) $[75,000.00] minus the balance of the Administrative Fee Fund (as defined in the Bond Indenture) as of January 1 of such year, multiplied by (y) 0.54.
(c) During the term of this Agreement, promptly following completion of the annual audit of Issuer’s financial statements at the end of each fiscal year (currently the twelve-month period ending December 31), Issuer shall compare its revenues (as determined in accordance with the Bond Indenture) and expenses under the Energy Project for that fiscal year.

If this annual comparison demonstrates that such revenues exceeded such expenses during the applicable fiscal year and there are amounts on deposit in the fund established by the Bond Indenture available for such purpose, then Issuer shall make refunds to the Project Participant in the amount available after making allowances for any necessary and appropriate reserves and contingencies (including but not limited to amounts deemed reasonably necessary by Issuer to fund any working capital reserve and to reserve or account for unfunded liabilities, including future sinking fund or other principal amortization of the Bonds. As of the Execution Date, the projected Annual Refund for the Initial Rate Period is $[____] per MWh.

Section 3.3 No Obligation to Take Base Energy. Notwithstanding anything to the contrary in this Agreement, Purchaser shall not be required to purchase and receive any Base Attachment Staff Report Item 15C
12 Energy hereunder, and Issuer shall cause MSES to remarket any portion of the Contract Quantity that is Base Energy pursuant to the provisions of Exhibit C to the Prepaid Agreement.

Section 3.4 Reset Period Remarketing.
(a) Reset Period Notice. For each Reset Period, Issuer shall provide to Purchaser, at least ten (10) days prior to the Remarketing Election Deadline, formal written notice setting forth (i) the duration of such Reset Period, (ii) the Estimated Available Discount (as defined in the Re-Pricing Agreement) for such Reset Period, and (iii) the applicable Remarketing Election Deadline (a “Reset Period Notice”). Issuer may thereafter update such notice at any time prior to the Remarketing Election Deadline and may extend the Remarketing Election Deadline in its sole discretion in any such update.
(b) Remarketing Election. If the Reset Period Notice (or any update thereto) indicates that the Available Discount in such notice is not at least equal to the Minimum Discount for that Reset Period, then: (i) a “Potential Remarketing Event” shall be deemed to exist, and (ii) Purchaser may, not later than the Remarketing Election Deadline, issue a written notice in the form attached hereto as Exhibit C (a “Remarketing Election Notice”) to Issuer, MSES and the Trustee electing for all of Purchaser’s Energy that would otherwise be delivered hereunder to be remarketed during the applicable Reset Period; provided, however, if the actual Available Discount, as finally determined under the Re-Pricing Agreement, is equal to or greater than the Minimum Discount, then Issuer may, in its sole discretion, elect by written notice to Purchaser to treat such Remarketing Election Notice as void (a “Voided Remarketing Election Notice”). For the avoidance of doubt, in the event that Purchaser issues a Remarketing Election Notice (other than a Voided Remarketing Notice), any rights and obligations assigned to MSCG under the Initial Assigned PPA or a subsequent Assignment Agreement including, without limitation, the right to receive Assigned Energy, shall revert to Purchaser as of the end of the Initial Reset Period or the then-current Reset Period, as applicable.
(c) Final Determination of Available Discount. The Parties acknowledge and agree that the final Available Discount for any Reset Period following the Initial Reset Period will be determined on the applicable Re-Pricing Date (as defined in the Re-Pricing Agreement), and that such Available Discount may differ from the estimate or estimates of such Available Discount provided to Purchaser prior to the applicable Remarketing Election Deadline. Accordingly, the Parties agree that:
(i) the Available Discount for any Reset Period will not be less than the Minimum Discount applicable to such Reset Period, unless Issuer has provided notice of a Potential Remarketing Event to Purchaser in accordance with Section 3.4(b); and (ii) if Purchaser receives notice of a Potential Remarketing Event and has not provided a Remarketing Election Notice prior to the applicable Remarketing Election Deadline, Purchaser shall be deemed to have elected to continue to purchase and receive its Contract Quantity at a Contract Price that reflects the Monthly Discount portion of the Available Discount as finally determined on the applicable Re-Pricing Date, plus Purchaser’s right to its share of Annual Refunds, if any, and all delivery and purchase Attachment Staff Report Item 15C
13 obligations under this Agreement shall continue in full force and effect for the applicable Reset Period.
(d) Resumption of Deliveries. Notwithstanding the issuance of any Remarketing Election Notice for a Reset Period, Purchaser will (i) remain obligated to purchase the Contract Quantities hereunder for each subsequent Reset Period, unless Purchaser issues a new valid Remarketing Election Notice (other than a Voided Remarketing Election Notice) for any such Reset Period in accordance with Section 3.4(b) and (ii) not make any new commitment to purchase Priority Energy during such Reset Period to the extent any such commitment could reasonably be expected to cause, during any portion of the Delivery Period after such Reset Period, Purchaser’s aggregate obligations to purchase Priority Energy (including its obligation to purchase Priority Energy hereunder) to exceed Purchaser’s expected aggregate requirements for Energy that will be used (A) for a “qualifying use” as defined in U.S. Treas. Reg. § 1.148-1(e)(2)(iii) and (B) in a manner that will not result in any “private business use” within the meaning of Section 141 of the Code.
(e) Reduction of Contract Quantity. The Parties recognize and agree that the Contract Quantity may be reduced in a Reset Period pursuant to the re-pricing methodology described in the Re-Pricing Agreement if necessary to achieve a successful remarketing of the Bonds. The Parties agree further that if, pursuant to the Re-Pricing Agreement, Issuer and the Calculation Agent determine in connection with the establishment of any new Reset Period that:
(i) such Reset Period will be the final Reset Period and (ii) such Reset Period will end prior to the end of the original Delivery Period, then (A) Issuer will notify Purchaser, (B) the Delivery Period will be deemed to be modified so that it ends at the end of such Reset Period, and (C) the Contract Quantity for the last Month in such Reset Period may be reduced as provided in the Re-Pricing Agreement.

ARTICLE IV

FAILURE TO DELIVER OR TAKE ENERGY
Notwithstanding anything herein to the contrary, neither Purchaser nor Issuer shall have any liability or other obligation to one another for any failure to Schedule, take, or deliver Assigned Product.

ARTICLE V
TRANSMISSION AND DELIVERY; COMMUNICATIONS
Section 5.1 Delivery of Energy. All Assigned Energy delivered under this Agreement shall be Scheduled at the applicable Assigned Delivery Point and in accordance with the terms of the applicable Assignment Agreement. All other Assigned Product shall be delivered consistent with the terms of the applicable Assignment Agreement. Except as set forth in the two foregoing sentences, Buyer and Seller shall have no liability or obligations under this Article V with respect to Assigned Product.

Section 5.2 Scheduling. Scheduling of Assigned Energy shall be in accordance with the applicable Assignment Agreement.

Attachment Staff Report Item 15C
14 Section 5.3 Title and Risk of Loss. Title to the Energy delivered under this Agreement and risk of loss shall pass from Seller to Buyer at the Assigned Delivery Point. The transfer of title and risk of loss for all Assigned Product other than Assigned Energy shall be in accordance with the applicable Assignment Agreement; provided that all Assignment Agreements shall provide for the transfer of Renewable Energy Credits in accordance with WREGIS.

Section 5.4 PCC1 Product and Long-Term PCC1 Product. To the extent that any Assigned Product is PCC1 Product or Long-Term PCC1 Product, the following provisions apply:
(a) Eligibility. Seller, and, if applicable, its successors, represents and warrants that throughout the Delivery Term of this Agreement that: (i) the Project qualifies and is certified by the CEC as an Eligible Renewable Energy Resource (“ERR”) as such term is defined in Public Utilities Code Section 399.12 or Section 399.16; and (ii) the Project’s output delivered to Buyer qualifies under the requirements of the California Renewables Portfolio Standard. To the extent a change in law occurs after execution of this Agreement that causes this representation and warranty to be materially false or misleading, it shall not be an Event of Default if Seller has used commercially reasonable efforts to comply with such change in law. [STC 6, Non-Modifiable. (Source: D.07-11-025, Attachment A.) D.08-04-009]. As used above, “Seller” means “Issuer”, Buyer means “Purchaser”, and any other capitalized terms not otherwise defined herein shall have the meaning specified in the Assigned Agreement.
(b) Transfer of Renewable Energy Credits. Seller and, if applicable, its successors, represents and warrants that throughout the Delivery Term of this Agreement the renewable energy credits transferred to Buyer conform to the definition and attributes required for compliance with the California Renewables Portfolio Standard, as set forth in California Public Utilities Commission Decision 08-08-028, and as may be modified by subsequent decision of the California Public Utilities Commission or by subsequent legislation. To the extent a change in law occurs after execution of this Agreement that causes this representation and warranty to be materially false or misleading, it shall not be an Event of Default if Seller has used commercially reasonable efforts to comply with such change in law. [STC REC-1, Non-modifiable. D.11-01- 025]. As used above, “Seller” means “Issuer”, Buyer means “Purchaser”, and any other capitalized terms not otherwise defined herein shall have the meaning specified in the Assigned Agreement. (c) Tracking of RECs in WREGIS. Seller warrants that all necessary steps to allow the Renewable Energy Credits transferred to Buyer to be tracked in the Western Renewable Energy Generation Information System will be taken prior to the first delivery under the contract. [STC REC-2, Non-modifiable. D.11-01-025]. As used above, “Seller” means “Issuer”, Buyer means “Purchaser”, and any other capitalized terms not otherwise defined herein shall have the meaning specified in the Assigned Agreement.
(d) Governing Law. This Agreement and the rights and duties of the Parties hereunder shall be governed by and construed, enforced and performed in accordance with the laws of the state of California, without regard to principles of conflicts of law. To the extent enforceable at such time, each Party waives its respective right to any jury trial with respect to any litigation arising under or in connection with this Agreement. [STC 17, Non-Modifiable. (Source:

D.07-11-025, Attachment A) D.08-04-009]
Attachment Staff Report Item 15C
15 (e) Issuer Representations and Warranties.

Issuer represents and warrants:
(i) Issuer has the right to sell the Assigned Product from the Applicable Project;
(ii) Issuer has not sold the Assigned Product or any REC or other attributes of the Assigned Product to be transferred to Purchaser to any other person or entity;
(iii) the Energy component of the Assigned Product produced by the Applicable Project and purchased by Issuer for resale to Purchaser hereunder is not being sold by Issuer back to the Applicable Project or PPA Seller;
(iv) Assigned Energy and Assigned RECs to be purchased and sold pursuant to this Agreement are not committed to another party; (v) The Assigned Product is free and clear of all liens or other encumbrances;
(vi) Issuer will deliver to Purchaser all Assigned Energy and associated RECs generated by the Applicable Project for Long-Term PCC1 Product in compliance with the California Long-Term Contracting Requirements, if applicable
(vii) The Assigned Product supplied to Purchaser under this Agreement that is Long-Term PCC1 Product will be sourced solely from Applicable Projects that have an Assignment Period of ten years or more in length, or otherwise in compliance with the California Long Term Contracting Requirements; and
(viii) Issuer will cooperate and work with Purchaser, the CEC, and/or the CPUC to provide any documentation required by the CPUC or CEC to support the Product’s classification as a Portfolio Content Category 1 Product as set forth in California Public Utilities Code Section 399.16(b)(1) or, if applicable, or compliance with the California Long-Term Contracting Requirements.

Issuer further represents and warrants to Purchaser that, to the extent that the Product sold by Issuer is a resale of part or all of a contract between Issuer and one or more third parties, Issuer represents, warrants and covenants that the resale complies with the following conditions in (i) through (iv) below during the Assignment Period and throughout the generation period:
(i) The original upstream third-party contract(s) meets the criteria of California Public Utilities Code Section 399.16(b)(1);
(ii) This Agreement transfers only electricity and RECs that have not yet been generated prior to the Assignment Period;
(iii) The electricity transferred by this Agreement is transferred to Attachment Staff Report Item 15C
16 Purchaser in real time; and
(iv) If the Applicable Project has an agreement to dynamically transfer electricity to a California balancing authority, the transactions implemented under this Agreement are not contrary to any condition imposed by a balancing authority participating in the dynamic transfer arrangement.
(f) Subsequent Changes in Law. In the event that the qualifications or requirements of the RPS program, PCC1 Product or the California Long-Term Contracting Requirements change, Issuer shall take commercially reasonable actions to meet the amended qualifications or requirements of the RPS Law, PCC1 Product or the California Long-Term Contracting Requirements but will not be required to incur any unreimbursed costs to comply with the RPS Law, PCC1 or the California Long- Term Contracting Requirements, collectively. (g) Limitations. Notwithstanding anything to the contrary in this Agreement, the Parties acknowledge and agree as follows:
(i) Issuer has relied exclusively upon the representations and warranties of each respective seller set forth in the Assigned Agreements in making the representations and warranties set forth in this Section

5.4 and has not performed any independent investigation with respect thereto;
(ii) MSES has agreed under the Prepaid Agreement to terminate or cause MSCG to terminate the applicable Assignment Period in the event that any representation or warranty in this Section 5.4 proves to be incorrect in any respect; and
(iii) Purchaser agrees that its sole recourse for any breach of the provisions of this Section 5.4 shall be the termination of the applicable Assignment Period and Purchaser shall have no other recourse against Issuer or remedies under this Agreement.

Section 5.5 Deliveries within CAISO or Another Balancing Authority. The Parties acknowledge that Energy delivered by Issuer at a Delivery Point within CAISO or another Balancing Authority will be delivered in accordance with the CAISO Tariff and rules of the Balancing Authority as applicable. Scheduling such Energy in accordance with the requirements of the applicable Energy into the applicable Balancing Authority shall constitute delivery of such Energy to Purchaser hereunder.

Section 5.6 Assigned Products. Notwithstanding anything to the contrary herein, the Parties shall have no liability under this Article V with respect to any Assigned Products.

Attachment Staff Report Item 15C
17 ARTICLE VI

PARTIAL ASSIGNMENTS OF PPAS
Section 6.1 Future PPA Assignments. In connection with the expiration or termination of an EPS Energy Period, each of the Parties agrees to satisfy its obligations under the Assignment Letter Agreement, including but not limited to (a) Purchaser’s obligation to exercise Commercially Reasonable Efforts to assign a portion of Purchaser’s rights and obligations under a power purchase agreement under which Project Participant is purchasing EPS Compliant Energy to MSCG or MSES pursuant to an Assignment Agreement and (b) the Parties’ obligations to cooperate in good faith with MSCG and MSES with respect to any proposed assignments.

Section 6.2 Updates to Exhibits A-1 and A-2.
(a) To the extent that an EPS Energy Period terminates or expires and Assigned Energy is not available for delivery immediately following (i) the end of the period for which Force Majeure is deemed to occur in the event of an early termination or (ii) the expiration of an EPS Energy Period, the Parties shall update (i) Exhibit A-1 to reflect an increase in the Hourly Quantities and (ii) Exhibit A-2 to reflect a decrease in the Monthly Quantities thereunder, in each case, in an amount equal to the Assigned Energy associated with the EPS Energy Period that terminated or expired.
(b) In connection with the execution of any subsequent Assignment Agreement, the Parties shall update Exhibits A-1 and A-2 to reflect any changes in the Hourly Quantities of Base Energy and Monthly Quantities of Assigned Energy and any other changes in connection therewith.

ARTICLE VII

USE OF ENERGY
Section 7.1 Tax Exempt Status of the Bonds. Purchaser acknowledges that the Bonds will be issued with the intention that the interest thereon will be exempt from federal taxes under Section 103 of the Code. Accordingly, Purchaser agrees that it will (a) provide such information with respect to its CCA System as may be requested by Issuer in order to establish the tax-exempt status of the Bonds, and (b) act in accordance with such written instructions as Issuer may provide from time to time in order to maintain the tax-exempt status of the Bonds. Purchaser further agrees that it will not at any time take any action, or fail to take any action, that would adversely affect the tax-exempt status of the Bonds.

Section 7.2 Priority Energy. Subject to Section 7.5(a), Purchaser agrees to take the Contract Quantities to be delivered under this Agreement (a) in priority over and in preference to all Non-Priority Energy; and (b) on at least a pari passu and non-discriminatory basis with other Priority Energy.

Section 7.3 Remarketing Sales .
(a) Remarketing of Assigned Energy. If notwithstanding Purchaser’s compliance with Section 7.1, a quantity of Assigned Energy less than the Monthly Quantity is delivered hereunder in any Month for any reason, then (i) MSCG shall remarket such undelivered Attachment Staff Report Item 15C
18 quantity of Assigned Energy to the PPA Supplier at the Contract Price plus the Monthly Discount then in effect, and (ii) Purchaser shall remain responsible for the Project Administration Fee for such quantity of Assigned Energy not delivered hereunder. For the avoidance of doubt, Purchaser will not have any payment obligation with respect to Assigned Energy that is remarketed pursuant to the foregoing sentence.
(b) Remarketing of Base Energy. Consistent with Section 3.3, to the extent any portion of the Contract Quantity is Base Energy, Issuer shall cause MSES to remarket or purchase such Energy for the account of MSES under the remarketing provisions of the Prepaid Agreement, and Issuer shall credit against the amount owed by Purchaser for such Contract Quantities the amounts received from MSES for such remarketing services, less all directly incurred costs or expenses, including but not limited to remarketing administrative charges paid to MSES under the Prepaid Agreement, but in no event shall the amount of such credit be more than the Contract Price. For the avoidance of doubt, Purchaser will not have any payment obligation with respect to Base Energy that is remarketed pursuant to the foregoing sentence. (c) MSES Remarketing Fees. Purchaser shall not in any case have an obligation to make a payment to Issuer with respect to any Remarketing Fee (as defined in the Prepaid Agreement) charged by MSES under the Prepaid Agreement Section 7.4 Qualifying Use. Subject to Section 7.5, Purchaser agrees that, without limiting Purchaser’s other obligations under this Article VII, it will use all of the Energy purchased under this Agreement in compliance with the Qualifying Use Requirements. Purchaser agrees that it will provide such additional information, records and certificates as Issuer may reasonably request to confirm Purchaser’s compliance with this Section 7.4.

Section 7.5 Remediation. To the extent that (a) all or a portion of the Contract Quantity is remarketed under Section 7.3(a) or Section 7.3(b), (b) Purchaser has exercised Commercially Reasonable Efforts (as determined by Special Tax Counsel (as defined in the Bond Indenture)) to obtain EPS Compliant Energy for delivery hereunder consistent with the Assignment Letter Agreement and (c) Purchaser is not otherwise in default under this Agreement, then:
(a) MSES shall be obligated under the remarketing provisions of the Prepaid Agreement to purchase the remarketed Energy for its own account at the Day-Ahead Market Price (the proceeds of any such purchases, “Disqualified Remarketing Proceeds”), which Disqualified Remarketing Proceeds are for the benefit of Purchaser in that such proceeds reduce its payment obligations hereunder;
(b) Purchaser shall (i) exercise Commercially Reasonable Efforts to use an amount equivalent to such Disqualified Remarketing Proceeds to purchase Non-Priority Energy and use such Non-Priority Energy in compliance with the Qualifying Use Requirements in order to remediate such Disqualified Remarketing Proceeds and (ii) apply its purchases of Non-Priority Energy to remediate Disqualified Remarketing Proceeds under this Agreement prior to remediating such proceeds under any other contract that provides for the purchase of Priority Energy;
Attachment Staff Report Item 15C
19 (c) in order to track compliance with Purchaser’s obligations under Section

7.5(b) above, Purchaser shall deliver a Remediation Certificate in the form of Exhibit H hereto to Issuer and MSES by the tenth day of the Month subsequent to any relevant Non-Priority Energy purchases (which may include purchases of Energy from CAISO to the extent such Energy is used in compliance with the Qualifying Use Requirements);
(d) for Disqualified Remarketing Proceeds remediated under this Section 7.5, Issuer shall pay Purchaser the Monthly Discount associated with such Disqualified Remarketing Proceeds on the last Business Day of the Month following the Month in which Purchaser provides a certificate under clause (c) evidencing such remediation; and (e) to the extent any Disqualified Remarketing Proceeds are not remediated within twelve Months of the date on which such proceeds were received by Issuer, then MSES shall be obligated under the Prepaid Agreement to exercise Commercially Reasonable Efforts to remediate such Disqualified Remarketing Proceeds under the Prepaid Agreement and Purchaser’s ability to remediate such remarketing proceeds shall be subject to MSES’s successful remediation of such proceeds through sales to other purchaser(s);
provided that, for the avoidance of doubt, to the extent Special Tax Counsel (as defined in the Bond Indenture) determines at any time that Purchaser has failed to exercise Commercially Reasonable Efforts to obtain EPS Compliant Energy for delivery hereunder consistent with the Assignment Letter Agreement, then Purchaser shall not be entitled to remediate any Disqualified Remarketing Proceeds related to the resulting remarketing of Base Energy by MSES.

ARTICLE VIII
REPRESENTATIONS AND WARRANTIES; ADDITIONAL COVENANTS
Section 8.1 Representations and Warranties of the Parties. As a material inducement to entering into this Agreement, each Party, with respect to itself, hereby represents and warrants to the other Party as of the Execution Date as follows:
(a) For Issuer as the representing Party, Issuer is a is a joint powers authority organized pursuant to the provisions of Title 1, Division 7, Chapter 5, Article 1 (Section 6500 et seq.) of the California Government Code;
(b) For Purchaser as the representing Party, Purchaser is a joint powers authority organized pursuant to the provisions of Title 1, Division 7, Chapter 5, Article 1 (Section 6500 et seq.) of the California Government Code and a community choice aggregator pursuant to the provisions of Section 366.2 of the California Public Utilities Code, duly organized and validly existing under the Laws of the State of California;
(c) it has all requisite power and authority to conduct its business, to own its properties and to execute, deliver and perform its obligations under this Agreement; (d) there is no litigation, action, suit, proceeding or investigation pending or, to the best of such Party’s knowledge, threatened, before or by any Government Agency, which could reasonably be expected to materially and adversely affect the performance by such Party of its obligations under this Agreement or that questions the validity, binding effect or enforceability Attachment Staff Report Item 15C
20 hereof, any action taken or to be taken by such Party pursuant hereto, or any of the transactions contemplated hereby;
(e) the execution, delivery and performance of this Agreement by such Party has been duly authorized by all necessary action on the part of such Party and does not require any approval or consent of any security holder of such Party or any holder (or any trustee for any holder) of any indebtedness or other obligation of such Party; (f) this Agreement has been duly executed and delivered on behalf of such Party by an appropriate officer or authorized Person of such Party and constitutes the legal, valid and binding obligation of such Party, enforceable against it in accordance with its terms, as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium and similar Laws affecting creditors’ rights generally and by general principles of equity; (g) the execution, delivery and performance of this Agreement by such Party shall not violate any provision of any Law, decree or other legal or regulatory determination applicable to it;
(h) the execution, delivery and performance by such Party of this Agreement, and the consummation of the transactions contemplated hereby, including the incurrence by such Party of its financial obligations under this Agreement, shall not result in any violation of any term of any material contract or agreement applicable to it, or any of its charter or bylaws or of any license, permit, franchise, judgment, writ, injunction or regulation, decree, order, charter, Law or ordinance applicable to it or any of its properties or to any obligations incurred by it or by which it or any of its properties or obligations are bound or affected, or of any determination or award of any arbitrator applicable to it, and shall not conflict with, or cause a breach of, or default under, any such term or result in the creation of any lien upon any of its properties or assets, except with respect to Issuer, the lien of the Bond Indenture;
(i) to the best of the knowledge and belief of such Party, no consent, approval, order or authorization of, or registration, declaration or filing with, or giving of notice to, obtaining of any license or permit from, or taking of any other action with respect to, any Government Agency is required in connection with the valid authorization, execution, delivery and performance by such Party of this Agreement or the consummation of any of the transactions contemplated hereby other than those that have been obtained; and
(j) it enters this Agreement as a bona-fide, arm’s-length transaction involving the mutual exchange of consideration and, once executed by both Parties, considers this Agreement a legally enforceable contract.

Section 8.2 Warranty of Title. Issuer warrants that it will have the right to convey and will transfer good and merchantable title to all Energy sold under this Agreement and delivered by it to Purchaser, free and clear of all liens, encumbrances, and claims.

Section 8.3 Disclaimer of Warranties. EXCEPT FOR THE WARRANTIES

EXPRESSLY MADE BY ISSUER IN THIS ARTICLE VIII, ISSUER HEREBY DISCLAIMS

ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

Attachment Staff Report Item 15C
21 Section 8.4 Continuing Disclosure. Purchaser agrees to provide to Issuer: (a) such financial and operating information as may be requested by Issuer including its most recent audited financial statements for use in Issuer’s offering documents for the Bonds; and (b) annual updates to such information and statements to enable Issuer to comply with its continuing disclosure undertakings under Rule 15(c)2-12 of the United States Securities and Exchange Commission. Failure by Purchaser to comply with its agreement to provide such annual updates shall not be a default under this Agreement, but any such failure shall entitle Issuer or an owner of the Bonds to take such actions and to initiate such proceedings as may be necessary and appropriate to cause Purchaser to comply with such agreement, including without limitation the remedies of mandamus and specific performance.

ARTICLE IX
TAXES
Issuer shall (i) be responsible for all ad valorem, excise and other taxes assessed with respect to Energy delivered pursuant to this Agreement upstream of the Delivery Point, and (ii) indemnify Purchaser and its Affiliates for any such taxes paid by Purchaser or its Affiliates.

Purchaser shall (i) be responsible for all such taxes assessed at or downstream of the Delivery Point, and (ii) indemnify Issuer and its Affiliates for any such taxes paid by Issuer or its Affiliates.

ARTICLE X

DISPUTE RESOLUTION
Section 10.1 Arbitration. Any dispute, claim or controversy arising out of or relating to this Agreement or the breach, termination, enforcement, interpretation or validity thereof, including the determination of the scope of this agreement to arbitrate, shall be determined by final, non-appealable binding arbitration in San Francisco, California before three arbitrators. The arbitration shall be administered by Judicial Arbitration and Mediation Services, Inc. (“JAMS”) pursuant to its Comprehensive Arbitration Rules and Procedures. Within 15 days after the commencement of arbitration, each of the Parties shall select one person to act as arbitrator, and the two so-selected arbitrators shall select a third arbitrator (the “chairperson”) within 30 days of the commencement of the arbitration. If either Party is unable or fails to select one person to act as arbitrator, such arbitrator shall be appointed by JAMS. If the Party-selected arbitrators are unable or fail to agree upon a chairperson, the chairperson shall be appointed by JAMS. The chairperson shall be a person who has experience in renewable energy-related transactions, and none of the arbitrators shall have been previously employed by either Party or have any direct pecuniary interest in either Party or the subject matter of the arbitration, unless such conflict is expressly acknowledged and waived in writing by each of the Parties. The Parties shall maintain the confidential nature of the arbitration proceeding and any award, including any hearing(s), except as may be necessary to prepare for or conduct the arbitration hearing on the merits, or except as necessary in connection with a court application for a preliminary remedy, a judicial challenge to an award or its enforcement, or unless otherwise required by law or judicial decision.

Any arbitration proceedings, decision or award rendered hereunder and the validity, effect and interpretation of this arbitration provision shall be governed by the Federal Arbitration Act. The arbitrator(s) shall have no authority to award consequential, treble, exemplary, or punitive damages of any type or kind regardless of whether such damages may be available under any law or right, with the Parties hereby affirmatively waiving their rights, if any, to recover or claim such Attachment Staff Report Item 15C
22 damages. In any arbitration arising out of or related to this Agreement, the arbitrators shall award to the prevailing Party, if any, the costs and attorneys’ fees reasonably incurred in seeking to enforce the application of this Section 10.1 and by the prevailing party in connection with the arbitration. Notwithstanding the foregoing provisions of this Section 10.1, any costs incurred by a Party in seeking judicial enforcement of any written decision of the arbitrators shall be chargeable to and borne exclusively by the Party against whom such court order is obtained. The award shall be final and binding on the Parties and judgment upon any award may be entered in any court of competent jurisdiction.

Section 10.2 Judicial Reference.
(a) Judicial Reference. Without limiting the provisions in Section 10.1, if Section 10.1 is ineffective or unenforceable, any dispute between the Parties arising out of or in connection with this Agreement or its performance, breach, or termination (including the existence, validity and interpretation of this Agreement and the applicability of any statute of limitation period) (each, a “Dispute”) shall be resolved by a reference proceeding in California in accordance with the provisions of Sections 638 et seq. of the California Code of Civil Procedure (“CCP”), or their successor sections (a “Reference Proceeding”), which shall constitute the exclusive remedy for the resolution of any Dispute. As a condition precedent to initiating a Reference Proceeding with respect to any Dispute, the Parties shall comply with the provisions of Section 10.2(b).
(b) Notice of Dispute. Prior to initiating the Reference Proceeding, a Party (the “Disputing Party”) shall provide the other Party (the “Responding Party”) with a written notice of each issue in dispute, a proposed means for resolving each such issue, and support for such position (the “Notice of Dispute”). Within 10 days after receiving the Notice of Dispute, the Responding Party shall provide the Disputing Party with a written Notice of each additional issue (if any) with respect to the dispute raised by the Notice of Dispute, a proposed means for resolving every issue in dispute, and support for such position (the “Dispute Response”). Thereafter, the Parties shall meet to discuss the matter and attempt in good faith to reach a negotiated resolution of the dispute.

If the Parties do not resolve the dispute by mutual agreement within 60 days after receipt of the Dispute Response, (the “Negotiation Period”), then either Party may provide to the other Party written notice of intent for judicial reference (the “Impasse Notice”) in accordance with the further provisions of this Section 10.2.
(c) Applicability; Selection of Referees.
(i) The Party that provides the Impasse Notice shall nominate one (1) referee at the same time it provides the Impasse Notice. The other Party shall nominate one referee within 10 days of receiving the Impasse Notice. The two (2) referees (the “Party-Appointed Referees”) shall appoint a third referee (the “Third Referee”, together with the Party-Appointed Referees, the “Referees”). The Party-Appointed Referees shall be competent and experienced in matters involving the electric energy business in the United States, with at least 10 years of electric industry experience as a practicing attorney.

The Third Referee shall be an active or retired California state or federal judge. Each of the Party-Appointed Referees and the Third Referee shall be impartial and independent of Attachment Staff Report Item 15C
23 either Party and of the other referees and not employed by any of the Parties in any prior matter.
(ii) If the Party-Appointed Referees are unable to agree on the Third Referee within 45 days from delivery of the Impasse Notice, then the Third Referee shall be appointed pursuant to CCP Section 640(b) in an action filed in the Superior Court of California, County of San Francisco (the “Court”), and with due regard given to the selection criteria above. A request for appointment of a referee may be heard on an ex parte or expedited basis, and the Parties agree that irreparable harm would result if ex parte relief is not granted. Pursuant to CCP Section 170.6, each Party shall have one (1) peremptory challenge to the referee selected by the Court. (d) Discovery; Proceedings.
(i) The Parties agree that time is of the essence in conducting the Reference Proceeding. Accordingly, the referees shall be requested, subject to change in the time periods specified herein for good cause shown, to (i) set the matter for a status and trial-setting conference within 20 days after the date of selection of the Third Referee, (ii) if practicable, try all issues of law or fact within 180 days after the date of the conference, and (iii) report a statement of decision within 20 days after the matter has been submitted for decision.
(ii) Discovery and other pre-hearing procedures shall be conducted as agreed to by the Parties, or if they cannot agree, as determined by the Third Referee after discussion with the Parties regarding the need for discovery and other pre-hearing procedures.
(iii) Any matter before the Referees shall be governed by the substantive law of California, its Code of Civil Procedure, Rules of Court, and Evidence Code, except as otherwise specifically agreed by the Parties and approved by the Referees. Except as expressly set forth herein, the Third Referee shall determine the manner in which the Reference Proceeding is conducted, including the time and place of hearings, the order of presentation of evidence, and all other questions that arise with respect to the course of the Reference Proceeding. The Reference Proceeding, including the trial, shall be conducted at a neutral location selected by the Parties, or if not agreed by the Parties, by the Third Referee, in San Francisco, California.
(iv) All proceedings and hearings conducted before the referees, except for trial, shall be conducted without a court reporter, except that when any Party so requests, a court reporter will be used at any hearing conducted before the referees, and the referees will be provided a courtesy copy of the transcript. The Party making such a request shall have the obligation to arrange for and pay the court reporter. (e) Decision. The referees shall render a written statement of decision setting forth findings of fact and conclusions of law. The decision shall be entered as a judgment in the court in accordance with the provisions of CCP Sections 644 and 645. The decision shall be appealable to the same extent and in the same manner that such decision would be appealable if Attachment Staff Report Item 15C
24 rendered by a judge of the Court. The Parties intend this general reference agreement to be specifically enforceable in accordance with the CCP.
(f) Expenses. Each Party shall bear the compensation and expenses of its respective Party-Appointed Referee, own counsel, witnesses, consultants and employees. All other expenses of judicial reference shall be split equally between the Parties.

ARTICLE XI

FORCE MAJEURE
Section 11.1 Applicability of Force Majeure. To the extent either Party is prevented by Force Majeure from carrying out, in whole or part, its obligations under this Agreement and such Party (the “Claiming Party”) gives notice and details of the Force Majeure to the other Party as soon as practicable, then the Claiming Party shall be excused from the performance of its obligations with respect to this Agreement (other than the obligation to make payments then due or becoming due with respect to performance prior to the Force Majeure). The Claiming Party shall mitigate the Force Majeure with all reasonable dispatch. For the duration of the Claiming Party’s non-performance (and only for such period), the non-Claiming Party shall not be required to perform or resume performance of its obligations to the Claiming Party corresponding to the obligations of the Claiming Party excused by Force Majeure.

Section 11.2 Settlement of Labor Disputes. Notwithstanding anything to the contrary herein, the Parties agree that the settlement of strikes, lockouts or other industrial disturbances shall be within the sole discretion of the Party experiencing such disturbance, and the failure of a Party to settle such strikes, lockouts or other industrial disturbances shall not prevent the existence of Force Majeure or of reasonable dispatch to remedy the same.

ARTICLE XII

GOVERNMENTAL RULES AND REGULATIONS
Section 12.1 Compliance with Laws. This Agreement shall be subject to all present and future Laws of any Government Agency having jurisdiction, and neither Party has knowingly undertaken or will knowingly undertake or knowingly cause to be undertaken any activity that would conflict with such Laws; provided, however, that nothing herein shall be construed to restrict or limit either Party’s right to object to or contest any such Law, or its application to this Agreement or the transactions undertaken hereunder, and neither acquiescence therein or compliance therewith for any period of time shall be construed as a waiver of such right.

Section 12.2 Contests. Excluding all matters involving a contractual dispute between the Parties, no Party shall contest, cause to be contested or in any way actively support the contest of the equity, fairness, reasonableness or lawfulness of any terms or conditions set forth or established pursuant to this Agreement, as those terms or conditions may be at issue before any Government Agency in any proceeding, if the successful result of such contest would be to preclude or excuse the performance of this Agreement by either Party.

Section 12.3 Defense of Agreement. Excluding all matters involving a contractual dispute between the Parties, each Party shall hereafter defend and support this Agreement before any Government Agency in any proceeding, if the substance, validity or enforceability of all or Attachment Staff Report Item 15C
25 any part of this Agreement is hereafter directly challenged or if any proposed changes in regulatory practices or procedures would have the effect of making this Agreement invalid or unenforceable or would otherwise materially affect the rights or obligations of the Parties under this Agreement.

ARTICLE XIII

ASSIGNMENT
The terms and provisions of this Agreement shall extend to and be binding upon the Parties and their respective successors, assigns, and legal representatives; provided, however, that, subject to Section 18.14, neither Party may assign this Agreement or its rights and interests, in whole or in part, under this Agreement without the prior written consent of the other Party. Prior to assigning this Agreement, Purchaser shall deliver to Issuer (i) written confirmation from each of the Applicable Rating Agencies, provided that such agency has rated and continues to rate the Bonds, that the assignment will not result in a reduction, qualification, or withdrawal of the then-current ratings assigned by the Applicable Rating Agencies to the Bonds; or (ii) written confirmation from each of the Applicable Rating Agencies, that the assignee has an outstanding long-term senior, unsecured, unenhanced debt rating equivalent to or higher than the ratings assigned by the Applicable Rating Agencies to the Bonds. Whenever an assignment or a transfer of a Party’s interest in this Agreement is requested to be made with the written consent of the other Party, the assigning or transferring Party’s assignee or transferee shall expressly agree to assume, in writing, the duties and obligations under this Agreement of the assigning or transferring Party.

Upon the agreement of a Party to any such assignment or transfer, the assigning or transferring Party shall furnish or cause to be furnished to the other Party a true and correct copy of such assignment or transfer and assumption of duties and obligations.

ARTICLE XIV

PAYMENTS
Section 14.1 Monthly Statements.
(a) No later than the 5th day of each Month during the Delivery Period (excluding the first Month of the Delivery Period) and the first Month following the end of the Delivery Period, Purchaser shall deliver to Issuer a statement (a “Purchaser’s Statement”) listing any other amounts due to Purchaser in connection with this Agreement with respect to the prior Month(s).
(b) No later than the 10th day of each Month during the Delivery Period (excluding the first Month of the Delivery Period) and the first Month following the end of the Delivery Period (the “Billing Date”), Issuer shall deliver a statement (a “Billing Statement”) to Purchaser indicating (i) the total amount due to Issuer for Energy delivered in the prior Month, (ii) any other amounts due to Issuer or Purchaser in connection with this Agreement with respect to the prior Month(s), and (iii) the net amount due to Issuer or Purchaser. If the actual quantity delivered is not known by the Billing Date, Issuer may provisionally prepare a Billing Statement based on Issuer’s best available knowledge of the quantity of Energy delivered, which shall not exceed the Monthly Quantity or the sum of the Hourly Quantities in such Month, as applicable, plus any make-up quantities delivered during such Month. The invoiced quantity and amounts Attachment Staff Report Item 15C
26 paid thereon (with interest calculated on the amount overpaid or underpaid by Purchaser at the Default Rate) will then be adjusted on the following Month’s Billing Statement, as actual delivery information becomes available based on the actual quantity delivered. (c) Upon request by either Party, the other Party shall deliver such supporting documentation of the foregoing as such requesting Party may reasonably request.

Section 14.2 Payment.
(a) If the Billing Statement indicates an amount due from Purchaser, then Purchaser shall remit such amount to the Trustee for the benefit of the Issuer by wire transfer (pursuant to the Trustee’s instructions), in immediately available funds, on or before the 20th day of the Month following the most recent Month to which such Billing Statement relates, or if such day is not a Business Day, the preceding Business Day. If the Billing Statement indicates an amount due from Issuer, then Issuer shall remit such amount to Purchaser by wire transfer (pursuant to Purchaser’s instructions), in immediately available funds, on or before the 28th day of the Month following the most recent Month to which such Billing Statement relates, or if such day is not a Business Day, the following Business Day.
(b) If Purchaser fails to issue a Purchaser’s Statement with respect to any Month, Issuer shall not be required to estimate any amounts due to Purchaser for such Month, provided that Purchaser may include any such amount on subsequent Purchaser’s Statements issued within the next sixty (60) days. The sixty (60) day deadline in this subsection (b) replaces the two (2) year deadline in Section 14.5(b) with respect to any claim by any non-delivering Party of inaccuracy in any estimated invoice issued or payment made pursuant to this subsection (b).

Section 14.3 Payment of Disputed Amounts; Correction of Index Price. (a) If Purchaser disputes any amounts included in the Issuer’s Billing Statement, Purchaser shall (except in the case of manifest error) nonetheless pay any amount required by the Billing Statement in accordance with Section 14.2 without regard to any right of set-off, counterclaim, recoupment or other defenses to payment that Purchaser may have; provided, however, that Purchaser shall have the right, after payment, to dispute any amounts included in a Billing Statement or otherwise used to calculate payments due under this Agreement pursuant to Section 14.5. If Issuer disputes any amounts included in the Purchaser’s Statement, Issuer may withhold payment to the extent of the disputed amount; provided, however, that interest shall be due at the Default Rate for any withheld amount later found to have been properly due. (b) If a value published for any rate or index used or to be used in this Agreement is subsequently corrected and the correction is published or announced by the Person responsible for that publication or announcement within 30 days after the original publication or announcement, either Party may notify the other Party of (i) that correction and (ii) the amount (if any) that is payable as a result of that correction. If, not later than 30 days after publication or announcement of that correction, a Party gives notice that an amount is so payable, the Party that originally either received or retained such amount shall, not later than three Business Days after the effectiveness of that notice, pay, subject to any other applicable provisions of this Agreement, to the other Party that amount, together with interest on that amount at the Default Rate for the Attachment Staff Report Item 15C
27 period from and including the day on which a payment originally was (or was not) made to but excluding the day of payment of the refund or payment resulting from that correction.

Section 14.4 Late Payment. If Purchaser fails to remit the full amount payable within one Business Day of when due, interest on the unpaid portion shall accrue from the date due until the date of payment at the Default Rate.

Section 14.5 Audit; Adjustments.
(a) A Party shall have the right, at its own expense, upon reasonable notice to the other Party and at reasonable times, to examine and audit and to obtain copies of the relevant portion of the books, records, and telephone recordings of the other Party to the extent reasonably necessary, but only to such extent, to verify the accuracy of any statement, charge, payment, or computation made under this Agreement. This right to examine, audit, and obtain copies shall not be available with respect to proprietary information not directly relevant to transactions under this Agreement.
(b) Each Purchaser’s Statement and each Billing Statement shall be conclusively presumed final and accurate and all associated claims for under- or overpayments shall be deemed waived unless such Purchaser’s Statement or Billing Statement is objected to in writing, with adequate explanation and/or documentation, within two (2) years after the applicable Month of Energy delivery.
(c) All retroactive adjustments shall be paid in full by the Party owing payment within thirty (30) days of notice and substantiation of such inaccuracy. If the Parties are unable to agree upon any retroactive adjustments requested by either Party within the time period specified in Section 14.5(b), then either Party may pursue any remedies available with respect to such adjustments at law or in equity. Retroactive adjustments for payments made based on an incorrect Billing Statement shall bear interest at the Default Rate from the date such payment was made.

Section 14.6 Netting; No Set-Off. The Parties shall net all amounts due and owing, including any past due amounts (which, for the avoidance of doubt, shall include any accrued interest), arising under this Agreement such that the Party owing the greater amount shall make a single payment of the net amount to the other Party in accordance with this Article XIV.

Notwithstanding the foregoing, payment for all amounts set forth in a Billing Statement provided to Purchaser shall be made without set-off or counterclaim of any kind.

Section 14.7 Source of Purchaser’s Payments. Purchaser covenants and agrees to make payments due hereunder from CCA Revenues, and only from such CCA Revenues, as an operating expense of its CCA System; provided, however, that Purchaser may apply any legally available monies to the payment of amounts due hereunder.

Section 14.8 Rate Covenant. Purchaser hereby covenants and agrees that it will establish, fix, prescribe, maintain, and collect rates, fees, and charges from the customers of its CCA System so as to provide CCA Revenues sufficient to enable Purchaser to pay any other amounts legally payable from CCA Revenues, and to maintain any required reserves for Purchaser’s CCA System.

Purchaser further covenants and agrees that it shall not furnish or supply Energy services free of charge to any Person, except any such service free of charge that Purchaser is supplying on the Attachment Staff Report Item 15C
28 date hereof as has been specifically identified by Purchaser to Issuer in writing, and it shall promptly enforce the payment of any and all accounts owing to Purchaser for the sale of Energy to its customers. Notwithstanding anything herein to the contrary, Purchaser shall not be obligated to make any payments hereunder except from CCA Revenues.

Section 14.9 Pledge of CCA Revenues. Purchaser shall not grant any lien on or security interest in, or otherwise pledge or encumber, the CCA Revenues if the terms or effect of such lien, pledge or other encumbrance results in such lien, pledge or other encumbrance having priority over the obligations of Purchaser to pay the Contract Price, which obligations constitute operating expenses of Purchaser.

Section 14.10Financial Responsibility. When reasonable grounds for insecurity of payments due under this Agreement arise, Issuer may demand, and Purchaser shall provide within 48 Hours but at least one Business Day if demanded, adequate assurance of performance.

Reasonable grounds include but are not limited to the occurrence of an insolvency or liquidation proceeding with respect to Purchaser or the downgrading of Purchaser’s credit rating, if any, to a level below investment grade, or such facts and circumstances which would constitute reasonable grounds for insecurity under applicable Law. Adequate assurance shall mean sufficient security in the form and for a term reasonably specified by Issuer, including but not limited to a standby irrevocable letter of credit, a prepayment, a deposit to an escrow account, or a performance bond or guaranty by a creditworthy entity. In the event Issuer is entitled to demand adequate assurance of performance under this Section 14.10, Issuer may demand at a minimum a prepayment by Purchaser of an amount equal to (a) the amount owed by Purchaser with respect to all Energy delivered by Issuer to Purchaser as of the date of the demand for Adequate assurance of performance, plus (b) the amount, as determined and adjusted from time to time by Issuer (with the input of MSES pursuant to the Receivables Purchase Provisions (as defined in the Bond Indenture)) in a Commercially Reasonable manner, expected to be owed by Purchaser with respect to the Energy to be delivered by Issuer to Purchaser during the remainder of the then-current Month and the following Month. The Parties agree that in the event Purchaser fails to provide such adequate assurance as demanded, Issuer shall have the right to suspend its performance under this Agreement, including the making of deliveries of Energy to Purchaser, immediately upon written notice and shall not be obligated to restore such performance until the later of (i) the first day of the Month after such demand has been satisfied, and (ii) the completion of the term of deliveries to any replacement sales customer to which MSES has remarketed the Energy on behalf of Issuer.

ARTICLE XV
[RESERVED]

ARTICLE XVI

NOTICES
Any notice, demand, or request required or authorized by this Agreement to be given by one Party to the other Party (or to a third party) shall be in writing and shall either be sent by electronic means, courier, or personally delivered (including overnight delivery service) to each of the notice recipients and addresses specified in Exhibit B for the receiving Party. Any such notice, demand, or request shall be deemed to be given (i) on the date it is delivered by electronic Attachment Staff Report Item 15C
29 means or (ii) when actually received if delivered by courier or personal delivery (including overnight delivery service). Each Party shall have the right, upon 10 days’ prior written notice to the other Party, to change its list of notice recipients and addresses in Exhibit B. The Parties may mutually agree in writing at any time to deliver notices, demands or requests through alternate or additional methods. Notwithstanding the foregoing, a Party may at any time notify the other Party that any notice, demand, statement or request to it must be provided by email transmission for a specified period of time or until further notice, and any communications delivered by means other than email transmission during the specified period of time shall be ineffective.

ARTICLE XVII
DEFAULT; REMEDIES; TERMINATION
Section 17.1 Issuer Default. Each of the following events shall constitute an “Issuer Default” under this Agreement:
(a) any representation or warranty made by Issuer in this Agreement proves to have been incorrect in any material respect when made; or (b) Issuer fails to perform, observe or comply with any covenant, agreement or term contained in this Agreement, and such failure continues for more than thirty (30) days following the earlier of (i) receipt by Issuer of notice thereof or (ii) an officer of Issuer obtaining actual knowledge of such default.

Section 17.2 Purchaser Default. Each of the following events shall constitute a “Purchaser Default” under this Agreement:
(a) Purchaser fails to pay when due any amounts owed to Issuer pursuant to this Agreement and such failure continues for one (1) Business Day following the earlier of (i) receipt by Purchaser of notice thereof or (ii) an officer of Purchaser becoming aware of such default; (b) Purchaser (i) is dissolved (other than pursuant to a consolidation, amalgamation or merger); (ii) becomes insolvent or is unable to pay its debts or fails or admits in writing its inability generally to pay its debts as they become due; (iii) makes a general assignment, arrangement or composition with or for the benefit of its creditors; (iv) institutes or has instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency Law or other similar Law affecting creditors’ rights, or a petition is presented for its winding-up or liquidation, and, in the case of any such proceeding or petition instituted or presented against it, such proceeding or petition (A) results in a judgment of insolvency or bankruptcy or the entry of an order for relief or the making of an order for its winding-up or liquidation or (B) is not dismissed, discharged, stayed or restrained, in each case within thirty (30) days of the institution or presentation thereof; (v) has a resolution passed for its winding-up, official management or liquidation (other than pursuant to a consolidation, amalgamation or merger); (vi) seeks or becomes subject to the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official for it or for all or substantially all of its assets; (vii) has a secured party take possession of all or substantially all of its assets or has a distress, execution, attachment, sequestration or other legal process levied, enforced or sued on or against all or substantially all its of assets and such secured party maintains Attachment Staff Report Item 15C
30 possession, or any such process is not dismissed, discharged, stayed or restrained, in each case within thirty (30) days thereafter; (viii) causes or is subject to any event with respect to it which, under the applicable Laws of any jurisdiction, has an analogous effect to any of the events specified in clauses (i) through (vii); or (ix) takes any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the foregoing acts; (c) any representation or warranty made by Purchaser in this Agreement proves to have been incorrect in any material respect when made; or (d) Purchaser failsto perform, observe or comply with any covenant, agreement or term contained in this Agreement, and such failure continues for more than fifteen (15) days following the earlier of (i) receipt by Purchaser of notice thereof or (ii) an officer of Purchaser becoming aware of such default.

Section 17.3 Remedies Upon Default.
(a) Termination. If at any time an Issuer Default or a Purchaser Default has occurred and is continuing, then the non-defaulting Party may do any or all of the following (i) by notice to the defaulting Party specifying the relevant Issuer Default or Purchaser Default, as applicable, terminate this Agreement effective as of a day not earlier than the day such notice is deemed given under Article XVI and/or (ii) declare all amounts due to the non-defaulting Party under this Agreement or any part thereof immediately due and payable, and the same shall thereupon become immediately due and payable, without notice, demand, presentment, notice of dishonor, notice of intent to demand, protest or other formalities of any kind, all of which are hereby expressly waived by the defaulting Party; provided, however, this Agreement shall automatically terminate and all amounts due to the non-defaulting Party hereunder shall immediately become due and payable as of the time immediately preceding the institution of the relevant proceeding or the presentation of the relevant petition that upon the occurrence of a Purchaser Default specified in Section 17.2(b)(iv) or, to the extent analogous thereto, Section

17.2(b)(viii). In addition, during the existence of an Issuer Default or a Purchaser Default, as applicable, the non-defaulting Party may exercise all other rights and remedies available to it at Law or in equity, including without limitation mandamus, injunction and action for specific performance, to enforce any covenant, agreement or term of this Agreement. (b) Additional Remedies. In addition to the remedies set forth in Section

17.3(a) (and without limiting any other provisions of this Agreement), during the existence of any Purchaser Default, Issuer may suspend its performance hereunder and discontinue the supply of all or any portion of the Energy otherwise to be delivered to Purchaser by it under this Agreement.

If Issuer exercises its right to suspend performance under this Section 17.3(b), Purchaser shall remain fully liable for payment of all amounts in default and shall not be relieved of any of its payment obligations under this Agreement. Deliveries of Energy may only be reinstated, at a time to be determined by Issuer, upon (i) payment in full by Purchaser of all amounts then due and payable under this Agreement and (ii) payment in advance by Purchaser at the beginning of each Month of amounts estimated by Issuer to be due to Issuer for the future delivery of Energy under this Agreement for such Month. Issuer may continue to require payment in advance from Purchaser after the reinstatement of Issuer’s supply services under this Agreement for such period of time as Issuer in its sole discretion may determine is appropriate. In addition, and without Attachment Staff Report Item 15C
31 limiting any other provisions of or remedies available under this Agreement, if Purchaser fails to accept from Issuer any Energy tendered for delivery under this Agreement, Issuer shall have the right to sell such Energy to third parties on any terms that Issuer, in its sole discretion, determines are appropriate.
(c) Effect of Early Termination. As of the effectiveness of any termination date in accordance with clause (i) of Section 17.3(a), (i) the Delivery Period shall end, (ii) the obligation of Issuer to make any further deliveries of Energy to Purchaser under this Agreement shall terminate, and (iii) the obligation of Purchaser to receive deliveries of Energy from Issuer under this Agreement will terminate. Neither this Agreement nor the Delivery Period may be terminated for any reason except as specified in this Article XVII. Without prejudice to any payment obligation in respect of periods prior to termination, no payments will be due from either Party in respect of periods occurring after the effective termination date of this Agreement.

Section 17.4 Termination of Prepaid Agreement. Purchaser acknowledges and agrees that (i) in the event the Prepaid Agreement terminates for any reason prior to the end of the Delivery Period, this Agreement shall terminate on the effective date of early termination of the Prepaid Agreement (which date shall be the last date upon which deliveries are required thereunder, subject to all winding up arrangements) and (ii) Issuer’s obligation to deliver Energy under this Agreement shall terminate upon the termination of deliveries of Energy to Issuer under the Prepaid Agreement. Issuer shall provide notice to Purchaser of any early termination date of the Prepaid Agreement. The Parties recognize and agree that, in the event that the Prepaid Agreement terminates because of a Failed Remarketing (as defined in the Bond Indenture) of the Bonds that occurs in the first Month of a Reset Period, Issuer shall deliver Energy under this Agreement for the remainder of such first Month, and, notwithstanding anything in this Agreement to the contrary, no Monthly Discount or Annual Refunds shall be associated with such deliveries and the Contract Price shall be adjusted accordingly.

Section 17.5 Limitation on Damages. THE PARTIES CONFIRM THAT THE

EXPRESS REMEDIES AND MEASURES OF DAMAGES PROVIDED IN THIS AGREEMENT SATISFY THE ESSENTIAL PURPOSES HEREOF. FOR BREACH OF ANY

PROVISION FOR WHICH AN EXPRESS REMEDY OR MEASURE OF DAMAGES IS

HEREIN PROVIDED, SUCH EXPRESS REMEDY OR MEASURE OF DAMAGES SHALL BE THE SOLE AND EXCLUSIVE REMEDY, THE OBLIGOR’S LIABILITY SHALL BE

LIMITED AS SET FORTH IN SUCH PROVISION, AND ALL OTHER REMEDIES OR DAMAGES AT LAW OR IN EQUITY ARE WAIVED. NEITHER PARTY SHALL BE

LIABLE FOR CONSEQUENTIAL, INCIDENTAL, PUNITIVE, EXEMPLARY, OR

INDIRECT DAMAGES, LOST PROFITS OR OTHER BUSINESS INTERRUPTION

DAMAGES, BY STATUTE, IN TORT OR CONTRACT, UNDER ANY INDEMNITY PROVISION, OR OTHERWISE. IT IS THE INTENT OF THE PARTIES THAT THE

LIMITATIONS HEREIN IMPOSED ON REMEDIES AND THE MEASURE OF DAMAGES

BE WITHOUT REGARD TO THE CAUSE OR CAUSES RELATED THERETO, INCLUDING

WITHOUT LIMITATION THE NEGLIGENCE OF EITHER PARTY, WHETHER SUCH NEGLIGENCE BE SOLE, JOINT OR CONCURRENT, OR ACTIVE OR PASSIVE. TO THE

EXTENT ANY DAMAGES REQUIRED TO BE PAID UNDER THIS AGREEMENT ARE

LIQUIDATED, THE PARTIES ACKNOWLEDGE THAT THE DAMAGES ARE DIFFICULT

OR IMPOSSIBLE TO DETERMINE, OTHERWISE OBTAINING AN ADEQUATE REMEDY Attachment Staff Report Item 15C
32 IS INCONVENIENT, AND THE LIQUIDATED DAMAGES CONSTITUTE A REASONABLE APPROXIMATION OF THE HARM OR LOSS. IN DETERMINING THE

APPROPRIATE MEASURE OF DAMAGES THAT WOULD MAKE THE PARTIES WHOLE,

THE PARTIES HAVE THOROUGHLY CONSIDERED, INTER ALIA, THE UNCERTAINTY

OF FLUCTUATIONS IN COMMODITY PRICES, THE ABILITY AND INTENTION OF THE

PARTIES TO HEDGE SUCH FLUCTUATIONS, THE BARGAINED-FOR ALLOCATION OF

RISK, THE KNOWLEDGE, SOPHISTICATION AND EQUAL BARGAINING POWER OF

THE PARTIES, THE ARMS-LENGTH NATURE OF THE NEGOTIATIONS, THE SPECIAL

CIRCUMSTANCES OF THIS TRANSACTION, THE ACCOUNTING AND TAX

TREATMENT OF THE TRANSACTION BY THE PARTIES, AND THE ENTERING INTO

OF OTHER TRANSACTIONS IN RELIANCE ON THE ENFORCEABILITY OF THE LIQUIDATED DAMAGES PROVISIONS CONTAINED HEREIN.

ARTICLE XVIII

MISCELLANEOUS
Section 18.1 Indemnification Procedure. With respect to each indemnification included in this Agreement, the indemnity is given to the fullest extent permitted by applicable Law and the following provisions shall be applicable. The indemnified Party shall promptly notify the indemnifying Party in writing of any Claim and the indemnifying Party shall have the right to assume its investigation and defense, including employment of counsel, and shall be obligated to pay related court costs, attorneys’ fees and experts’ fees and to post any appeals bonds; provided, however, that the indemnified Party shall have the right to employ at its expense separate counsel and participate in the defense of any Claim. The indemnifying Party shall not be liable for any settlement of a Claim without its express written consent thereto. In order to prevent double recovery, the indemnified Party shall reimburse the indemnifying Party for payments or costs incurred in respect of an indemnity with the proceeds of any judgment, insurance, bond, surety or other recovery made by the indemnified Party with respect to a covered event.

Section 18.2 Deliveries. Contemporaneously with this Agreement (unless otherwise specified): Each Party shall deliver to the other Party evidence reasonably satisfactory to it of (i) such Party’s authority to execute, deliver and perform its obligations under this Agreement and (ii) the appropriate individuals who are authorized to sign this Agreement on behalf of such Party;
(a) as of the date hereof, Purchaser shall deliver to Issuer a fully executed Federal Tax Certificate in the form attached hereto as Exhibit D; (b) on the Bond Closing Date, Purchaser shall deliver to Issuer an opinion of counsel to Purchaser in the form attached hereto as Exhibit E; (c) on the Bond Closing Date, Purchaser shall deliver to Issuer a Closing Certificate in substantially the form set forth hereto as Exhibit G.

Section 18.3 Entirety; Amendments. This Agreement, including the exhibits and attachments hereto, constitutes the entire agreement between the Parties and supersedes all prior discussions and agreements between the Parties with respect to the subject matter hereof. There Attachment Staff Report Item 15C
33 are no prior or contemporaneous agreements or representations affecting the same subject matter other than those expressed herein. Except for any matters that, in accordance with the express provisions of this Agreement, may be resolved by oral agreement between the Parties, no amendment, modification, supplement or change hereto shall be enforceable unless reduced to writing and executed by both Parties.

Section 18.4 Governing Law. THIS AGREEMENT AND THE RIGHTS AND DUTIES

OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY AND

CONSTRUED, ENFORCED AND PERFORMED IN ACCORDANCE WITH THE LAWS OF

THE STATE OF CALIFORNIA, WITHOUT REGARD TO ANY CONFLICTS OF LAW

PRINCIPLE THAT WOULD DIRECT THE APPLICATION OF ANOTHER
JURISDICTION’S LAW.

Section 18.5 Non-Waiver. No waiver of any breach of any of the terms of this Agreement shall be effective unless such waiver is in writing and signed by the Party against whom such waiver is claimed. No waiver of any breach shall be deemed a waiver of any other subsequent breach.

Section 18.6 Severability. If any provision of this Agreement, or the application thereof, shall for any reason be invalid or unenforceable, then to the extent of such invalidity or unenforceability, the remainder of this Agreement and the application of such provision to other Persons or circumstances shall not be affected thereby, but rather shall be enforced to the maximum extent permissible under applicable Law, so long as the economic and legal substance of the transactions contemplated hereby is not affected in any materially adverse manner as to either Party.

Section 18.7 Exhibits. Any and all Exhibits referenced in this Agreement are hereby incorporated herein by reference and shall be deemed to be an integral part hereof.

Section 18.8 Winding Up Arrangements. All indemnity and confidentiality obligations, audit rights, and other provisions specifically providing for survival shall survive the expiration or termination of this Agreement. The expiration or termination of this Agreement shall not relieve either Party of (a) any unfulfilled obligation or undischarged liability of such Party on the date of such termination or (b) the consequences of any breach or default of any warranty or covenant contained in this Agreement. All obligations and liabilities described in the preceding sentence of this Section 18.8, and applicable provisions of this Agreement creating or relating to such obligations and liabilities, shall survive such expiration or termination.

Section 18.9 Relationships of Parties. The Parties shall not be deemed to be in a relationship of partners or joint venturers by virtue of this Agreement, nor shall either Party be an agent, representative, trustee or fiduciary of the other. Neither Party shall have any authority to bind the other to any agreement. This Agreement is intended to secure and provide for the services of each Party as an independent contractor.

Section 18.10Immunity. Each Party represents and covenants to and agrees with the other Party that it is not entitled to and shall not assert the defense of sovereign immunity or governmental immunity with respect to its obligations or any Claims under this Agreement, and Attachment Staff Report Item 15C
34 each hereby waives any such defense of sovereign or governmental immunity to the full extent permitted by Law.

Section 18.11Rates and Indices. If the source of any publication used to determine the index or other price used in the Contract Price should cease to publish the relevant prices or should cease to be published entirely, an alternative index or other price will be used based on the determinations made by Issuer and MSES under Section 18.11 of the Prepaid Agreement. Issuer shall provide Purchaser the opportunity to provide its recommendations and other input to Issuer for Issuer’s use in the process for selecting such alternative index or other price under Section

18.11 of the Prepaid Agreement.

Section 18.12Limitation of Liability. Notwithstanding anything to the contrary herein, all obligations of Issuer under this Agreement, including without limitation all obligations to make payments of any kind whatsoever, are special, limited obligations of Issuer, payable solely from the Trust Estate (as such term is defined in the Bond Indenture) as and to the extent provided in the Bond Indenture, including with respect to Operating Expenses (as such term is defined in the Bond Indenture). Issuer shall not be required to advance any moneys derived from any source other than the Revenues (as such term is defined in the Bond Indenture) and other assets pledged under the Bond Indenture for any of the purposes in this Agreement mentioned. Neither the faith and credit of Issuer nor the taxing power of the State of California or any political subdivision thereof is pledged to payments pursuant to this Agreement. Issuer shall not be directly, indirectly, contingently or otherwise liable for any costs, expenses, losses, damages, claims or actions, of any conceivable kind on any conceivable theory, under or by reasons of or in connection with this Agreement, except solely to the extent Revenues (as such term is defined in the Bond Indenture) are received for the payment thereof and may be applied therefor pursuant to the terms of the Bond Indenture.

Section 18.13Counterparts. This Agreement may be executed and acknowledged in multiple counterparts and by the Parties in separate counterparts, each of which shall be an original and all of which shall be and constitute one and the same instrument.

Section 18.14Third Party Beneficiaries; Rights of Trustee. Purchaser acknowledges and agrees that (a) Issuer will pledge and assign its rights, title and interest in this Agreement and the amounts payable by Purchaser under this Agreement (other than amounts payable in respect of the Project Administration Fee) to secure Issuer’s obligations under the Bond Indenture, (b) the Trustee shall be a third-party beneficiary of this Agreement with the right to enforce Purchaser’s obligations under this Agreement, (c) the Trustee or any receiver appointed under the Bond Indenture shall have the right to perform all obligations of Issuer under this Agreement, and (d) in the event of any Purchaser Defaults under Section 17.2(a), (i) MSES may, to the extent provided for in, and in accordance with, the Receivables Purchase Provisions (as defined in the Bond Indenture), take assignment from Issuer of receivables owed by Purchaser to Issuer under this Agreement, and shall thereafter have all rights of collection with respect to such receivables, and (ii) if such receivables are not so assigned, the Commodity Swap Counterparty (as defined in the Bond Indenture) shall have the right to pursue collection of such receivables to the extent of any non-payment by Issuer to the Commodity Swap Counterparty was caused by Purchaser’s payment default. Pursuant to the terms of the Bond Indenture, Issuer has irrevocably appointed the Trustee as its agent to issue notices and as directed under the Bond Indenture, to take any Attachment Staff Report Item 15C
35 other actions that Issuer is required or permitted to take under this Agreement. Purchaser may rely on notices or other actions taken by Issuer or the Trustee and Purchaser has the right to exclusively rely on any notices delivered by the Trustee, regardless of any conflicting notices that it may receive from Issuer.

Section 18.15Waiver of Defenses. Purchaser waives all rights to set-off, counterclaim, recoupment and any other defenses that might otherwise be available to Purchaser with regard to Purchaser’s obligations pursuant to the terms of this Agreement.

IN WITNESS WHEREOF, the Parties have caused this Power Supply Contract to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first above written.
[Separate Signature Page(s) Attached]
Attachment Staff Report Item 15C
Signature Page to Power Supply Contract

CALIFORNIA COMMUNITY CHOICE FINANCING AUTHORITY
By: _____________________________
Name: _____________________________
Title: _____________________________
Attachment Staff Report Item 15C
Signature Page to Power Supply Contract

EAST BAY COMMUNITY ENERGY AUTHORITY
By: _____________________________
Name: _____________________________
Title: _____________________________
Attachment Staff Report Item 15C
A-1
EXHIBIT A-1

BASE ENERGY HOURLY QUANTITIES
[To come.]
Attachment Staff Report Item 15C
A-2
EXHIBIT A-2

EPS ENERGY PERIOD MONTHLY QUANTITY
[To come.]
Attachment Staff Report Item 15C
B-1

EXHIBIT B

NOTICES
IF TO ISSUER: California Community Choice Financing Authority 1125 Tamalpais Avenue
San Rafael, CA 94901
Email: [____]
IF TO PURCHASER: East Bay Community Energy Authority
1999 Harrison Street, Suite 800
Oakland, CA 94612
Email: [email protected]
Energy Related: [email protected]
Invoicing/Payments: [email protected]; [email protected] Attachment Staff Report Item 15C
C-1

EXHIBIT C

FORM OF REMARKETING ELECTION NOTICE
[_____]
Morgan Stanley Energy Structuring, L.L.C.
1585 Broadway
New York, NY 10036-8293
The Bank of New York Mellon Trust Company, N.A.
4655 Salisbury Road, Suite 300
Jacksonville, Florida 32256
To the Addressees:

The undersigned, duly authorized representative of East Bay Community Energy Authority (the "Purchaser"), is providing this notice (the “Remarketing Election Notice”) pursuant to the Power Supply Contract, dated as of [____], 2022 (the “Supply Contract”), between California Community Choice Financing Authority and Purchaser. Capitalized terms used herein shall have the meanings set forth in the Supply Contract.

Pursuant to Section 3.4(b) of the Supply Contract, the Purchaser has elected to have its Contract Quantity for the applicable Reset Period remarketed beginning as of the commencement of such Reset Period. The resumption of deliveries in any future Reset Period shall be in accordance with Section 3.4(d) of the Supply Contract.

Given this [___] day of [_________], 20[__].

East Bay Community Energy Authority
By: _____________________
Printed Name:

Title:

Attachment Staff Report Item 15C
D-1

EXHIBIT D

FORM OF FEDERAL TAX CERTIFICATE
This Federal Tax Certificate is executed in connection with the Power Supply Contract dated as of [_______], 2022 (the “Supply Contract”), by and between California Community Choice Financing Authority (“Issuer”) and East Bay Community Energy Authority (“Purchaser”).

Capitalized terms used and not otherwise defined herein shall have the meanings given to them in the Supply Contract or in the Bond Indenture.

WHEREAS Purchaser acknowledges that Issuer is issuing the Bonds to fund the prepayment price under the Prepaid Agreement; and
WHEREAS the Bonds are intended to qualify for tax exemption under Section 103 of the Internal Revenue Code of 1986, as amended; and
WHEREAS Purchaser’s use of Energy acquired pursuant to the Supply Contract and certain funds and accounts of Purchaser will affect the Bonds’ qualification for such tax exemption.

NOW, THEREFORE, PURCHASER HEREBY CERTIFIES AS FOLLOWS:

1. Purchaser is a community choice aggregator organized as a joint powers authority under the laws of the State of California. As a community choice aggregator, the Purchaser is a load-serving entity providing electricity to customers within the boundaries of cities and/or counties that have elected to participate in Purchaser’s community choice aggregation program. For purposes of this Certificate, the term “service area” of the Purchaser means the boundaries of the cities and/or counties that have elected to participate in the Purchaser’s community choice aggregation program, as well as any other area recognized as the service area of the Purchaser under state or federal law.

2. Purchaser will resell all of the Energy acquired pursuant to the Supply Contract to its retail Energy customers within its service area, with retail sales in all cases being made pursuant to regularly established and generally applicable tariffs or under authorized requirements contracts.

3. From [___, __] to [____, 2022] the annual average amount of Energy purchased (other than for resale) by customers of Purchaser who are located within the service area of Purchaser is [________] MWh. Over the term of the Supply Contract, the Purchaser expects the annual average amount of Energy purchased (other than for resale) by customers of the Purchaser who are located within the service area of the Purchaser to be at least [_____] MWh. The maximum annual amount of Energy in any year being acquired pursuant to the Supply Contract is [_______] MWh. The annual average amount of Energy which Purchaser otherwise has a right to acquire as of the Closing Date (including rights to capacity to generate electricity, whether owned, leased or otherwise contracted for) is [________] MWh. The sum of (a) the maximum amount of Energy in any year being acquired pursuant to the Supply Contract, and (b) the amount of Energy that Purchaser otherwise has a right to acquire (including rights to capacity to generate electricity, whether owned, leased or otherwise contracted for) in the year described in the foregoing clause Attachment Staff Report Item 15C
D-2
(a), is [________] MWh. Accordingly, the amount of Energy to be acquired under the Supply Contract by Purchaser, supplemented by the amount of Energy otherwise available to Purchaser as of the Closing Date, during any year does not exceed [___]% of the expected annual average amount of Energy to be purchased (other than for resale) by customers of Purchaser who are located within the service area of Purchaser.

3. In the event of the expiration or termination of an EPS Energy Period, Purchaser agrees to comply with its obligations under the Assignment Letter Agreement, including but not limited to its obligations to (a) exercise Commercially Reasonable Efforts to assign a portion of Purchaser’s rights and obligations under a power purchase agreement under which Purchaser is purchasing EPS Compliant Energy to MSCG or MSES pursuant to an Assignment Agreement and (b) cooperate in good faith with Issuer, MSCG and MSES with respect to any proposed assignments.

4. Purchaser expects to pay for Energy acquired pursuant to the Supply Contract solely from funds derived from its operations as a community choice aggregator. Purchaser expects to use current CCA Revenues of its CCA System to pay for current Energy acquisitions. Neither the Purchaser nor any person who is a related party to the Purchaser will hold any funds or accounts in which monies are set aside and invested and which are reasonably expected to be used to pay for Energy more than one year after such monies are set aside. No portion of the proceeds of the Bonds will be used directly or indirectly to replace funds of Purchaser or any persons who are related Persons to Purchaser that are or were intended to be used for the purpose for which the Bonds were issued.
_______________, 2022
By: ________________________________
[Name]
[Title]
Attachment Staff Report Item 15C
E-1

EXHIBIT E

FORM OF OPINION OF COUNSEL TO PURCHASER
California Community Choice Financing Authority
San Rafael, CA
Morgan Stanley Energy Structuring, L.L.C.

New York, NY
Morgan Stanley
New York, NY
The Bank of New York Mellon Trust Company, N.A., as trustee Jacksonville, FL
[Royal Bank of Canada]
[Toronto, Ontario]
Re: Power Supply Contract between East Bay Community
Energy Authority and California Community Choice
Financing Authority dated as of [____], 2022
Ladies and Gentlemen:

We are Counsel to East Bay Community Energy Authority (“Purchaser”). Purchaser is a Purchaser in the Energy Project undertaken by California Community Choice Financing Authority (“Issuer”). We are furnishing this opinion to you in connection with the Power Supply Contract between Issuer and Purchaser dated as of [____], 2022 (the “Supply Contract”).

Unless otherwise specified herein, all terms used but not defined in this opinion shall have the same meaning as is ascribed to them in the Supply Contract.

In connection with this opinion, we have examined originals or copies, certified or otherwise identified to our satisfaction, of the following:
(a) The Constitution and laws of the State of California (the “State”) including, as applicable, acts, ordinances, certificates, articles, charters, bylaws, and agreements pursuant to which Purchaser was created and by which it is governed; (b) Resolution No. [__], duly adopted by Purchaser on [___________] (the “Resolution”) and certified as true and correct by certificate and seal, authorizing Purchaser to execute and deliver the Supply Contract;
(c) A copy of the Supply Contract executed by Purchaser; and Attachment Staff Report Item 15C
E-2
(d) All outstanding instruments relating to bonds, notes, or other indebtedness of or relating to Purchaser and Purchaser's CCA System (as defined in the Supply Contract).

We have also examined and relied upon originals or copies, certified or otherwise authenticated to our satisfaction, of such records, documents, certificates, and other instruments, and made such investigations of law, as in our judgment we have deemed necessary or appropriate to enable us to render the opinions expressed below.

Based upon the foregoing, we are of the opinion that:

1. Purchaser is a joint powers authority of the State, duly organized and validly existing as a community choice aggregator under the laws of the State, and has the power and authority to own its properties, to carry on its business as now being conducted, and to enter into and to perform its obligations under the Agreement.

2. The execution, delivery, and performance by Purchaser of the Supply Contract have been duly authorized by the governing body of Purchaser and do not and will not require, subsequent to the execution of the Supply Contract by Purchaser, any consent or approval of the governing body or any officers of Purchaser.

3. The Supply Contract is the legal, valid, and binding obligation of Purchaser, enforceable in accordance with its terms, except as such enforceability may be subject to (i) the exercise of judicial discretion in accordance with general principles of equity and (ii) bankruptcy, insolvency, reorganization, moratorium, and other similar laws affecting creditors' rights heretofore or hereafter enacted, to the extent constitutionally applicable.

4. No approval, consent or authorization of any governmental or public agency, authority, commission or person, or, to our knowledge, of any holder of any outstanding bonds or other indebtedness of Purchaser, is required with respect to the execution, delivery and performance by Purchaser of the Supply Contract or Purchaser's participation in the transactions contemplated thereby other than those approvals, consents and/or authorizations that have already been obtained.

5. The authorization, execution and delivery of the Supply Contract and compliance with the provisions thereof (a) will not conflict with or constitute a breach of, or default under, (i) any instrument relating to the organization, existence or operation of Purchaser, (ii) any ruling, regulation, ordinance, judgment, order or decree to which Purchaser (or any of its officers in their respective capacities as such) is subject or (iii) any provision of the laws of the State relating to Purchaser and its affairs, and (b) to our knowledge will not result in, or require the creation or imposition of, any lien on any of the properties or revenues of Purchaser pursuant to any of the foregoing.

6. Purchaser is not in breach of or default under any applicable constitutional provision or any law or administrative regulation of the State or the United States or any applicable judgment or decree or, to our knowledge, any loan or other agreement, resolution, indenture, bond, note, resolution, agreement or other instrument to which Purchaser is a party or to which Purchaser or any of its property or assets is otherwise subject, and to our knowledge no event has occurred Attachment Staff Report Item 15C
E-3
and is continuing which with the passage of time or the giving of notice, or both, would constitute a default or event of default under any such instrument.

7. Payments to be made by Purchaser under the Supply Contract shall constitute operating expenses of Purchaser's CCA System payable solely from the revenues and other available funds of Purchaser's CCA System as a cost of purchased electricity. The application of the revenues and other available funds of Purchaser's CCA System to make such payments is not subject to any prior lien, encumbrance or other restriction.

8. As of the date of this opinion, to the best of our knowledge after due inquiry, there is no pending or threatened action or proceeding at law or in equity or by any court, government agency, public board or body affecting or questioning the existence of Purchaser or the titles of its officers to their respective offices or affecting or questioning the legality, validity, or enforceability of this Supply Contract nor to our knowledge is there any basis therefor.

This opinion is rendered solely for the use and benefit of the addressees listed above in connection with the Supply Contract and may not be relied upon other than in connection with the transactions contemplated by the Supply Contract, or by any other person or entity for any purpose whatsoever, nor may this opinion be quoted in whole or in part or otherwise referred to in any document or delivered to any other person or entity, without the prior written consent of the undersigned.

Very truly yours,
Attachment Staff Report Item 15C
F-1

EXHIBIT F

MONTHLY DISCOUNT
Monthly Discount: $[____]/MWh
Attachment Staff Report Item 15C
G-1

EXHIBIT G

FORM OF CLOSING CERTIFICATE

CLOSING CERTIFICATE OF PURCHASER
__________, 2022
Re: California Community Choice Financing Authority
Clean Energy Project Revenue Bonds
The undersigned _____________________________ of East Bay Community Energy Authority (the “Purchaser”), hereby certifies as follows in connection with the Power Supply Contract dated as of __________, 2022 (the “Agreement”) between the Purchaser and California Community Choice Financing Authority (“Issuer”) and the issuance and sale by Issuer of the above-referenced bonds (the “Bonds”) (capitalized terms used and not defined herein shall have the meanings given to them in the Agreement):

1. Purchaser is a community choice aggregator, duly created and validly existing as a joint powers authority, and is in good standing, under the laws of the State of California (the “State”), and has the corporate power and authority to enter into and perform its obligations under the Agreement.

2. By all necessary official action on its part, the Purchaser has duly authorized and approved the execution and delivery of, and the performance by the Purchaser of the obligations on its part contained in the Agreement, and such authorization and approval has not been amended, supplemented, rescinded or modified in any respect since the date thereof.

3. The Agreement constitutes the legal, valid and binding obligation of the Purchaser.

4. The authorization, execution and delivery of the Agreement and compliance with the provisions on the Purchaser's part contained therein (a) will not conflict with or constitute a breach of or default under (i) any instrument relating to the organization, existence or operation of Purchaser, (ii) any ruling, regulation, ordinance, judgment, order or decree to which Purchaser (or any of its officers in their respective capacities as such) is subject or (iii) any provision of the laws of the State relating to Purchaser and its affairs, and (b) will not result in, or require the creation or imposition of, any lien on any of the properties or revenues of Purchaser pursuant to any of the foregoing.
5 The Purchaser is not in breach of or default under any applicable constitutional provision, law or administrative regulation of the State or the United States or any applicable judgment or decree or any loan agreement, indenture, bond, note, resolution, agreement or other instrument to which the Purchaser is a party or to which the Purchaser or any of its property or Attachment Staff Report Item 15C
G-2
assets are subject, and no event has occurred and is continuing which constitutes or with the passage of time or the giving of notice, or both, would constitute a default or event of default by the Purchaser under any of the foregoing.

6. Payments to be made by the Purchaser under the Agreement shall constitute operating expenses of the Purchaser’s CCA System (as defined in the Agreement) payable solely from the revenues and other available funds of Purchaser’s CCA System as a cost of purchased electricity. The application of the revenues and other available funds of the Purchaser’s CCA System to make such payments is not subject to any prior lien, encumbrance or other restriction.

7. No litigation, proceeding or tax challenge is pending or, to its knowledge, threatened, against the Purchaser in any court or administrative body which would (a) contest the right of the officials of the Purchaser to hold and exercise their respective positions, (b) contest the due organization and valid existence of the Purchaser, (c) contest the validity, due authorization and execution of the Agreement or (d) attempt to limit, enjoin or otherwise restrict or prevent the Purchaser from executing, delivering and performing the Agreement, nor to the knowledge of the Purchaser is there any basis therefor.

8. All authorizations, approvals, licenses, permits, consents and orders of any governmental authority, legislative body, board, agency or commission having jurisdiction of the matter which are required for the due authorization of, which would constitute a condition precedent to, or the absence of which would materially adversely affect the due performance by the Purchaser of its obligations under the Agreement have been duly obtained.

9. The representations and warranties of the Purchaser contained in the Agreement were true, complete and correct on and as of the date thereof and are true, complete and correct on and as of the date hereof.

10. The statements and information with respect to the Purchaser contained in the Official Statement dated ___________, 2022 with respect to the Bonds, including Appendix B thereto (the “Official Statement”), fairly and accurately describe and summarize the financial and operating position of the Purchaser for the periods shown therein, and such statements and information did not as of the date of the Official Statement and do not as of the date hereof contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make such statements and information, in the light of the circumstances under which they were made, not misleading.

11. No event affecting the Purchaser has occurred since the date of the Official Statement which should be disclosed therein in order to make the statements and information with respect to the Purchaser contained therein, in light of the circumstances under which they were made, not misleading in any material respect.

Attachment Staff Report Item 15C
G-3
IN WITNESS WHEREOF the undersigned has executed this Certificate on and as of the date first written above.

EAST BAY COMMUNITY ENERGY

AUTHORITY
By
Name:

Title:

Attachment Staff Report Item 15C
H-1

EXHIBIT H

FORM OF REMEDIATION CERTIFICATE
[_____], 20__
[_____]
Morgan Stanley Energy Structuring, L.L.C.
1585 Broadway
New York, NY 10036-8293
Attn: Miscellaneous Notices
Email: [[email protected]]
Re: Power Supply Contract with California Community Choice Financing Authority: Section

7.5 Remediation
To the addressees:

The undersigned, duly authorized representative of East Bay Community Energy Authority (“Purchaser”), hereby certifies as follows in connection with the Power Supply Contract, dated as of [____], 2022 (the “Contract”), between Purchaser and California Community Choice Financing Authority and remediation of Disqualified Remarketing Proceeds pursuant to Section

7.5 of the Contract. Capitalized terms used herein shall have the meanings set forth in the Contract.

Set forth as Attachment 1 hereto is a copy of Purchaser’s invoice for the Month of [____] for purchases of Energy from [____] [NOTE: Insert reference to supplier.] pursuant that certain [____] [NOTE: Insert reference to applicable supply agreement.], and all of such Energy was used in compliance with the Qualifying Use Requirements.

In witness whereof the undersigned has executed this Certificate on and as of the date first written above.

EAST BAY COMMUNITY ENERGY

AUTHORITY
By ___________________________________
[Name]
[Title]
Attachment Staff Report Item 15C
HB Draft 6 May 2022

LETTER AGREEMENT
[____], 2022
East Bay Community Energy Authority
1999 Harrison Street, Suite 800
Oakland, CA 94612
Email: [email protected]
California Community Choice Financing Authority
1125 Tamalpais Avenue
San Rafael, CA 94901
Email: [_____]
Re: PPA Assignments for Delivery under Prepay Energy Agreements Ladies and Gentlemen:

This Letter Agreement (this “Letter Agreement”) confirms our mutual agreement with respect to the matters set forth below and relates to (i) that certain Power Supply Contract (the “Power Supply Contract”), dated as of the date hereof, by and between California Community Choice Financing Authority (“Issuer”) and East Bay Community Energy Authority (“Project Participant”), (ii) that certain Prepaid Energy Sales Agreement (the “Prepaid Agreement”), dated as of the date hereof, by and between Morgan Stanley Energy Structuring, L.L.C. (“MSES”) and Issuer, and (iii) that certain Energy Management Contract (together with the Power Supply Contract and the Prepaid Agreement, the “Prepay Energy Agreements”), dated as of the date hereof, by and between Morgan Stanley Capital Group Inc. (“MSCG”) and MSES. Any capitalized term used in this Letter Agreement and not otherwise defined herein shall have the meaning assigned to such term in the Power Supply Contract. In consideration of each party’s execution of the respective Prepay Energy Agreements, as well as the premises above and the mutual covenants and agreements set forth herein, Issuer, Project Participant, MSES and MSCG (collectively, the “Parties”) agree as follows:

1. PPA Assignments for Delivery under Prepay Energy Agreements. (a) Initial Assignment. Concurrently with the execution of the Prepay Energy Agreements, Project Participant has assigned and MSES has agreed to assume a portion of Project Participant’s rights and obligations under the Initial Assigned PPA. (b) Replacement Assignments. Commencing (i) six months prior to the expiration of any EPS Energy Period or the resumption of deliveries in a new Reset Period following Participant’s issuance of a Remarketing Election Notice pursuant to Section 3.4 of the Power Supply Contract or (ii) otherwise immediately upon the early termination or anticipated early termination of an EPS Energy Period, Project Participant shall exercise Commercially Reasonable Efforts to assign a portion of Project Participant’s rights and obligations (the “Assigned Rights and Obligations”) under one or more power purchase agreements under which Project Participant is purchasing EPS Compliant Energy pursuant Attachment Staff Report Item 15D
2 to an Assignment Agreement substantially in the form of (A) the Limited Assignment Agreement set forth as Exhibit A hereto if the PPA Supplier is an unrelated third party or (B) the Limited Assignment Agreement set forth as Exhibit B hereto if the PPA Supplier is MSCG, and the Parties shall cooperate in good faith with respect to any proposed assignments; provided that
(1) any subsequent Assignment Agreement shall provide (I) for the assignment by Project Participant to either (a) MSES if MSCG is the PPA Supplier or (b) MSCG if the PPA Supplier is an unrelated third party of its right to receive a portion of the Energy (and any associated products set forth in the Assignment Agreement) delivered under the applicable power purchase agreement for each Month of the applicable EPS Energy Period and (II) for payment by MSES or MSCG as applicable to the PPA Supplier under such subsequent power purchase agreement of the Day-Ahead Average Price for each Month of the applicable EPS Energy Period, with such amounts to be credited in the PPA Supplier’s monthly invoice to Project Participant against other amounts owed by Project Participant under the Assigned PPA during the EPS Energy Period;
(2) any third party PPA Supplier must satisfy MSCG’s internal credit and approval requirements and other requirements applied on a nondiscriminatory basis, including any “know your customer” rules, policies and procedures, anti-money laundering rules and regulations, Dodd-Frank Act, Commodity Exchange Act, Patriot Act and similar rules, regulations, requirements and corresponding policies; (3) any such assignment must be agreed and consented to by Project Participant, MSES and MSCG in their reasonable discretion; and
(4) the Parties recognize that MSCG will be obligated to sell and deliver Assigned Product it receives from a third party PPA Supplier to MSES under the Energy Management Agreement; MSES will be obligated to deliver Assigned Product that it acquires to Issuer under the terms of the Prepaid Agreement; and Issuer will be obligated to deliver Assigned Product that it acquires to Project Participant under the terms of the Power Supply Contract.
(c) MSCG Procurement of EPS Compliant Energy. To the extent that (i) Project Participant, MSES and MSCG have not agreed upon a replacement assignment of a power purchase agreement by the date that is 75 days prior to (A) the end of any EPS Energy Period or (B) the resumption of deliveries in a new Reset Period following Participant’s issuance of a Remarketing Election Notice pursuant to Section 3.4 of the Power Supply Contract, or (ii) an early termination of an EPS Energy Period has occurred and Project Participant, MSES and MSCG have not agreed upon a replacement assignment of a power purchase agreement, then MSCG shall exercise Commercially Reasonable Efforts to obtain EPS Compliant Energy for ultimate redelivery to Project Participant, provided that:

Attachment Staff Report Item 15D
3 (1) Project Participant must consent to MSCG’s procurement of any such EPS Compliant Energy for ultimate redelivery to Project Participant, with such consent not to be unreasonably withheld;
(2) the Parties shall act in good faith and in a Commercially Reasonable manner to negotiate any necessary amendments to the Prepay Energy Agreements to facilitate the delivery of such EPS Compliant Energy; and
(3) the period of delivery for any such EPS Compliant Energy (any such period, a “MSCG EPS Energy Period”) shall not exceed the length, as applicable, of (A) the then-current Reset Period if such EPS Compliant Energy is obtained for delivery for the remainder of a Reset Period and (B) the length of the next succeeding Reset Period if such EPS Compliant Energy is obtained for delivery commencing in a subsequent Reset Period.
(d) Tax Opinion. The Parties acknowledge and agree that their ability to enter into a new Reset Period will be contingent on obtaining an Opinion of Bond Counsel (as defined in the Bond Indenture), which will be dependent on the availability of EPS Compliant Energy for delivery in such Reset Period.

2. Failure to Obtain EPS Compliant Energy. To the extent an EPS Energy Period terminates or expires and Project Participant and MSCG have been unable to obtain EPS Compliant Energy for delivery under the Prepay Energy Agreements pursuant to the provisions of Paragraph 1, then MSES shall remarket the Base Energy pursuant to the provisions of Exhibit C to the Prepaid Agreement, subject to the following:
(a) the Parties’ obligations set forth in Paragraph 1 shall continue to apply; (b) Project Participant shall not make any new commitment to purchase Priority Energy during such a remarketing; and
(c) consistent with Section 7.5 of the Power Supply Contract, Project Participant shall exercise Commercially Reasonable Efforts to remediate any Disqualifed Remarketing Proceeds resulting from MSES’s remarketing;.

3. Representations. Each Party represents to each of the other Parties:
(a) Status. It is duly organized and validly existing under the laws of the jurisdiction of its organization or incorporation and, if relevant under such laws, in good standing.
(b) Powers. It has the power to execute this Agreement and any other documentation relating to this Agreement to which it is a party, to deliver this Agreement and any other documentation relating to this Agreement that it is required by this Agreement to deliver and to perform its obligations under this Agreement and has taken all necessary action to authorize such execution, delivery and performance.

Attachment Staff Report Item 15D
4 (c) No Violation or Conflict. Such execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby, including the incurrence by such Party of its obligations under this Agreement, will not result in any violation of, or conflict with: (i) any term of any material contract or agreement applicable to it; (ii) any of its charter, bylaws, or other constitutional documents; (iii) any determination or award of any arbitrator applicable to it; or (iv) any license, permit, franchise, judgment, writ, injunction or regulation, decree, order, charter, law, ordinance, rule or regulation of any Government Agency, applicable to it or any of its assets or properties or to any obligations incurred by it or by which it or any of its assets or properties or obligations are bound or affected, and shall not cause a breach of, or default under, any such term or result in the creation of any lien upon any of its properties or assets. (d) Consents. All consents, approvals, orders or authorizations of, registrations, declarations, filings or giving of notice to, obtaining of any licenses or permits from, or taking of any other action with respect to, any Person or Government Agency that are required to have been obtained by such Party with respect to this Agreement and the transactions contemplated hereby, including the due authorization of such Party and its governing body and any approval or consent of any security holder of such Party or any holder (or any trustee for any holder) of any indebtedness or other obligation of such Party, have been obtained and are in full force and effect and all conditions of any such consents have been complied with. (e) Obligations Binding. Its obligations under this Agreement constitute its legal, valid and binding obligations, enforceable in accordance with their respective terms (subject to applicable bankruptcy, reorganization, insolvency, moratorium or similar laws affecting creditors’ rights generally and subject, as to enforceability, to equitable principles of general application (regardless of whether enforcement is sought in a proceeding in equity or at law)).
(f) Non-Reliance. It is acting for its own account, and it has made its own independent decisions to enter into this Agreement and as to whether this Agreement is appropriate or proper for it based upon its own judgment and upon advice from such advisers as it has deemed necessary. It is not relying on any communication (written or oral) of the other Parties as investment advice or as a recommendation to enter into this Agreement; it being understood that information and explanations related to the terms and conditions of this Agreement shall not be considered investment advice or a recommendation to enter into this Agreement. It is entering into this Agreement as a bona-fide, arm’s-length transaction involving the mutual exchange of consideration and, once executed by all Parties, considers this Agreement a legally enforceable contract. No communication (written or oral) received from any of the other Parties shall be deemed to be an assurance or guarantee as to the expected results of this Agreement. (g) Assessment and Understanding. It is capable of assessing the merits of and understanding (on its own behalf or through independent professional advice), and understands and accepts, the terms, conditions and risks of this Agreement. It is also capable of assuming, and assumes, the risks of this Agreement.

Attachment Staff Report Item 15D
5 (h) Status of Parties. None of the other Parties is acting as a fiduciary for or an adviser to it in respect of this Agreement.

4. Counterparts. This Agreement (and each amendment, modification and waiver in respect of it) may be executed and delivered in counterparts (including by facsimile or electronic transmission), each of which will be deemed an original.

5. Costs and Expenses. The Parties will each pay their own costs and expenses (including legal fees) incurred in connection with this Agreement and as a result of the negotiation, preparation, and execution of this Agreement.

6. Amendments. No amendment, modification, or waiver in respect of this Agreement will be effective unless in writing (including a writing evidenced by a facsimile or electronic transmission) and executed by each of the Parties or confirmed by an exchange of telexes or electronic messages on an electronic messaging system.

7. Notices. Any notice, demand, statement or request required or authorized by this Agreement to be given by one Party to another shall be in writing, except as otherwise expressly provided herein. It shall be sent by email transmission, courier, or personal delivery (including overnight delivery service) to each of the notice recipients and addresses for each of the other Parties designated in Appendix 2 hereto. Any such notice, demand, or request shall be deemed to be given (i) when delivered by email transmission, or (ii) when actually received if delivered by courier or personal delivery (including overnight delivery service). Each Party shall have the right, upon written 10 days’ prior written notice to the other Parties, to change its address at any time, and to designate that copies of all such notices be directed to another person at another address.

The Parties may mutually agree in writing at any time to deliver notices, demands or requests through alternate or additional methods. Notwithstanding the foregoing, any Party may at any time notify the other Parties that any notice, demand, statement or request to it must be provided by email transmission for a specified period of time or until further notice, and any communications delivered by means other than email transmission during such time shall be ineffective.

8. Dispute Resolution.
(a) Governing Law. This Agreement and the rights and duties of the Parties under this Agreement will be governed by and construed, enforced and performed in accordance with the laws of the state of New York, without reference to any conflicts of laws provisions that would direct the application of another jurisdiction’s laws; provided, however, that the authority of Project Participant and Issuer to enter into and perform their obligations under this Agreement shall be determined in accordance with the laws of the State of California. (b) Arbitration. Any dispute, claim or controversy arising out of or relating to this Agreement or the breach, termination, enforcement, interpretation or validity thereof, including the determination of the scope of this agreement to arbitrate, shall be determined by final, non-appealable binding arbitration in San Francisco, California before three (3) arbitrators. The arbitration shall be administered by Judicial Arbitration and Mediation Services, Inc. (“JAMS”) Attachment Staff Report Item 15D
6 pursuant to its Comprehensive Arbitration Rules and Procedures. Within fifteen (15) days after the commencement of arbitration, each of MSCG and Project Participant shall select one person to act as arbitrator, and the two so-selected arbitrators shall select a third arbitrator (the “chairperson”) within thirty (30) days of the commencement of the arbitration. If either MSCG or Project Participant is unable or fails to select one person to act as arbitrator, such arbitrator shall be appointed by JAMS. If MSCG and Project Participant-selected arbitrators are unable or fail to agree upon a chairperson, the chairperson shall be appointed by JAMS. The chairperson shall be a person who has experience in renewable energy-related transactions, and none of the arbitrators shall have been previously employed by any Party or have any direct pecuniary interest in any Party or the subject matter of the arbitration, unless such conflict is expressly acknowledged and waived in writing by all of the Parties. The Parties shall maintain the confidential nature of the arbitration proceeding and any award, including any hearing(s), except as may be necessary to prepare for or conduct the arbitration hearing on the merits, or except as necessary in connection with a court application for a preliminary remedy, a judicial challenge to an award or its enforcement, or unless otherwise required by law or judicial decision. Any arbitration proceedings, decision or award rendered hereunder and the validity, effect and interpretation of this arbitration provision shall be governed by the Federal Arbitration Act. The arbitrator(s) shall have no authority to award consequential, treble, exemplary, or punitive damages of any type or kind regardless of whether such damages may be available under any law or right, with the Parties hereby affirmatively waiving their rights, if any, to recover or claim such damages. In any arbitration arising out of or related to this Agreement, the arbitrators shall award to the prevailing Party or Parties, if any, the costs and attorneys’ fees reasonably incurred in seeking to enforce the application of this Section 8(b) and by the prevailing party in connection with the arbitration.

Notwithstanding the foregoing provisions of this Section 8(b), any costs incurred by a Party in seeking judicial enforcement of any written decision of the arbitrators shall be chargeable to and borne exclusively by the Party against whom such court order is obtained. The award shall be final and binding on the Parties and judgment upon any award may be entered in any court of competent jurisdiction.
(c) Judicial Reference. Without limiting the provisions in Section 8(b), if Section 8(b) is deemed ineffective or unenforceable in any respect, any dispute between the Parties arising out of or in connection with this Agreement or its performance, breach, or termination (including the existence, validity and interpretation of this Agreement and the applicability of any statute of limitation period) (each, a “Dispute”) shall be resolved by a reference proceeding in California in accordance with the provisions of Sections 638 et seq. of the California Code of Civil Procedure (“CCP”), or their successor sections (a “Reference Proceeding”), which shall constitute the exclusive remedy for the resolution of any Dispute. As a condition precedent to initiating a Reference Proceeding with respect to any Dispute, the Parties shall comply with the provisions of Section 8(c)(i).
i. Notice of Dispute. Prior to initiating the Reference Proceeding, a Party (the “Disputing Party”) shall provide the other Parties (the “Responding Parties”) with a written notice of each issue in dispute, a proposed means for resolving each such issue, and support for such position (the “Notice of Dispute”). Within ten (10) Days after receiving the Notice of Dispute, the Responding Parties shall provide the Disputing Party with a written Notice of each additional issue (if any) with respect to the dispute raised by the Notice of Dispute, a proposed means for resolving every issue in dispute, and support for Attachment Staff Report Item 15D
7 such position (the “Dispute Response”). Thereafter, the Parties shall meet to discuss the matter and attempt in good faith to reach a negotiated resolution of the dispute. If the Parties do not resolve the dispute by unanimous agreement within sixty (60) Days after receipt of the Dispute Response, (the “Negotiation Period”), then any Party may provide to the other Parties written notice of intent for judicial reference (the “Impasse Notice”) in accordance with the further provisions of this Section 8(c). ii. Applicability; Selection of Referees.
(A) Within ten days of the delivery of an Impasse Notice, each of MSCG and Project Participant shall nominate one (1) referee. The two (2) referees (the “Party-Appointed Referees”) shall appoint a third referee (the “Third Referee”).

The Party-Appointed Referees shall be competent and experienced in matters involving the electric energy business in the United States, with at least ten (10) years of electric industry experience as a practicing attorney. The Third Referee shall be an active or retired California state or federal judge. Each of the Party-Appointed Referees and the Third Referee shall be impartial and independent of each of the Parties and of the other referees and not employed by any of the Parties in any prior matter.
(B) If the Party-Appointed Referees are unable to agree on the Third Referee within forty-five (45) Days from delivery of the Impasse Notice, then the Third Referee shall be appointed pursuant to CCP Section 640(b) in an action filed in the Superior Court of California, County of San Francisco (the “Court”), and with due regard given to the selection criteria above. A request for appointment of a referee may be heard on an ex parte or expedited basis, and the Parties agree that irreparable harm would result if ex parte relief is not granted. Pursuant to CCP Section 170.6, each of Project Participant and MSCG shall have one (1) peremptory challenge to the referee selected by the Court.
iii. Discovery; Proceedings.
(A) The Parties agree that time is of the essence in conducting the Reference Proceeding. Accordingly, the referees shall be requested, subject to change in the time periods specified herein for good cause shown, to (i) set the matter for a status and trial-setting conference within twenty (20) days after the date of selection of the Third Referee, (ii) if practicable, try all issues of law or fact within one hundred eighty (180) days after the date of the conference, and (iii) report a statement of decision within twenty (20) days after the matter has been submitted for decision.
(B) Discovery and other pre-hearing procedures shall be conducted as agreed to by the Parties, or if they cannot agree, as determined by the Third Referee after discussion with the Parties regarding the need for discovery and other pre-hearing procedures.

Attachment Staff Report Item 15D
8 (C) Except as expressly set forth herein, the Third Referee shall determine the manner in which the Reference Proceeding is conducted, including the time and place of hearings, the order of presentation of evidence, and all other questions that arise with respect to the course of the Reference Proceeding. The Reference Proceeding, including the trial, shall be conducted at a neutral location selected by the Parties, or if not agreed by the Parties, by the Third Referee, in San Francisco, California.
(D) All proceedings and hearings conducted before the referees, except for trial, shall be conducted without a court reporter, except that when any Party so requests, a court reporter will be used at any hearing conducted before the referees, and the referees will be provided a courtesy copy of the transcript. The Party making such a request shall have the obligation to arrange for and pay the court reporter.
iv. Decision. The referees shall render a written statement of decision setting forth findings of fact and conclusions of law. The decision shall be entered as a judgment in the court in accordance with the provisions of CCP Sections 644 and 645. The decision shall be appealable to the same extent and in the same manner that such decision would be appealable if rendered by a judge of the Court. The Parties intend this general reference agreement to be specifically enforceable in accordance with the CCP. v. Expenses. Each of MSCG and Project Participant shall bear the compensation and expenses of its respective Party-Appointed Referee, own counsel, witnesses, consultants and employees. All other expenses of judicial reference shall be split equally between MSCG and Project Participant.

9. Limitation of Liability. Notwithstanding anything to the contrary herein, all obligations of Issuer under this Agreement, including without limitation all obligations to make payments of any kind whatsoever, are special, limited obligations of Issuer, payable solely from the Trust Estate (as such term is defined in the Bond Indenture) as and to the extent provided in the Bond Indenture, including with respect to Operating Expenses (as such term is defined in the Bond Indenture). Issuer shall not be required to advance any moneys derived from any source other than the Revenues (as such term is defined in the Bond Indenture) and other assets pledged under the Bond Indenture for any of the purposes in this Agreement mentioned. Neither the faith and credit of Issuer nor the taxing power of the State of California or any political subdivision thereof is pledged to payments pursuant to this Agreement. Issuer shall not be directly, indirectly, contingently or otherwise liable for any costs, expenses, losses, damages, claims or actions, of any conceivable kind on any conceivable theory, under or by reasons of or in connection with this Agreement, except solely to the extent Revenues (as such term is defined in the Bond Indenture) are received for the payment thereof and may be applied therefor pursuant to the terms of the Bond Indenture.
[Signature Pages to Follow]
Attachment Staff Report Item 15D
Signature Page to Letter Agreement
Very truly yours,

MSES

MORGAN STANLEY ENERGY STRUCTURING,
L.L.C.

By:

Name:

Title:

MSCG

MORGAN STANLEY CAPITAL GROUP INC.

By:

Name:

Title:

ACKNOWLEDGED, ACCEPTED AND AGREED TO as of the date first set forth above:

PARTICIPANT

EAST BAY COMMUNITY ENERGY AUTHORITY
By:

Name:

Title:

ISSUER

CALIFORNIA COMMUNITY CHOICE FINANCING AUTHORITY
By:

Name:

Title:

Attachment Staff Report Item 15D

EXHIBIT A

FORM OF LIMITED ASSIGNMENT AGREEMENT FOR THIRD PARTY AS PPA

SUPPLIER
This Limited Assignment Agreement (this “Agreement”) is entered into as of [____] by and among [____], a [____] (“PPA Seller”), East Bay Community Energy Authority, a joint powers authority and a community choice aggregator organized under the laws of the State of California (“PPA Buyer”), and Morgan Stanley Capital Group Inc., a Delaware corporation (“MSCG”).

RECITALS
WHEREAS, PPA Buyer and PPA Seller are parties to that certain [____], dated as of [____] (the “PPA”);
WHEREAS, in connection with a prepaid electricity transaction between [_______] (“Issuer”) and Morgan Stanley Energy Structuring, L.L.C. (“MSES”), and with effect from and including the Assignment Period Start Date (as defined below), PPA Buyer wishes to transfer by limited assignment to MSCG, and MSCG wishes to accept the transfer by limited assignment of, the Assigned Rights and Obligations (as defined below) for the duration of the Assignment Period (as defined below); and
WHEREAS, pursuant to this Agreement, MSCG will receive the Assigned Product and MSCG will deliver the Assigned Product to MSES, which will redeliver the Assigned Product to Issuer for ultimate redelivery to PPA Buyer; and
WHEREAS, pursuant to this Agreement, MSCG will assume responsibility for the Delivered Product Payment Obligation.

THEREFORE, in consideration of the premises above and the mutual covenants and agreements herein set forth, PPA Seller, PPA Buyer and MSCG (the “Parties” hereto; each is a “Party”) agree as follows:

AGREEMENT

1. Definitions.

The following terms, when used in this Agreement and identified by the capitalization of the first letter thereof, have the respective meanings set forth below, unless the context otherwise requires:
“Agreement” has the meaning specified in the first paragraph above. “Assigned Delivery Point” has the meaning specified in Appendix 1.

Attachment Staff Report Item 15D
2 “Assigned Energy” means any Electricity associated with the Assigned Product to be delivered to MSCG hereunder pursuant to the Assigned Rights and Obligations. “Assigned Monthly Quantity” means the first [___] MWhs delivered in accordance with the PPA by PPA Seller in each Month during the Assignment Period. “Assigned Product” includes all (i) Energy and (ii) Green Attributes (PCC1) (as defined in the PPA) produced by the Facility (as defined in the PPA) associated with the Assigned Monthly Quantity.
“Assigned Product Price” means [NOTE: To be the Day-Ahead Price averaged for each day of the prior month if the assignment occurs after the commencement of the prepay transaction or the fixed price for energy under the PPA if assigned in connection with execution of the prepay transaction.].
“Assigned Rights and Obligations” means (i) the rights of PPA Buyer under the PPA to receive the Assigned Monthly Quantity of Assigned Product in each Month during the Assignment Period, as such rights may be limited or further described in the “Further Information” section on Appendix 1, and (ii) the Delivered Product Payment Obligation, which right and obligation are transferred and conveyed to MSCG hereunder, but which shall not relieve PPA Buyer of its obligations under the PPA in any respects.
“Assignment Early Termination Date” has the meaning specified in Section 5(b). “Assignment Period” has the meaning specified in Section 5(a). “Assignment Period End Date” means 11:59:59 p.m. pacific prevailing time on [____]. “Assignment Period Start Date” means [_____].
“Business Day” means any day except a Saturday, Sunday, or a Federal Reserve Bank holiday. A Business Day begins at 8:00 a.m. and ends at 5:00 p.m. local time for the Party sending a notice, or payment, or performing a specified action. “CAISO Tariff” means the California Independent System Operator Corporation Agreement and Tariff, Business Practice Manuals (BPMs), and Operating Procedures, including the rules, protocols, procedures and standards attached thereto, as the same may be amended or modified from time-to-time and approved by the Federal Energy Regulatory Commission. “Claims” means all claims or actions, threatened or filed, and the resulting losses, damages, expenses, attorneys’ fees, experts’ fees, and court costs, whether incurred by settlement or otherwise, and whether such claims or actions are threatened or filed prior to or after the termination of this Agreement, in each case arising under, in respect of or related in any way to the PPA or any transaction thereunder, except for the Delivered Product Payment Obligation. “Delivered Product Payment Obligation” has the meaning specified in Section 3(a).

Attachment Staff Report Item 15D
3 “Electricity” means three-phase, 60-cycle alternating current electric energy, expressed in megawatt hours (MWh).
“Government Agency” means the United States of America, any state thereof, any municipality, or any local jurisdiction, or any political subdivision of any of the foregoing, including, but not limited to, courts, administrative bodies, departments, commissions, boards, bureaus, agencies, or instrumentalities.
“Issuer” means [____], a [____] [NOTE: This will be the JPA or other entity formed for purposes of issuing municipal bonds for the prepaid transaction.]. “Inter-SC Trade” or “IST” has the meaning set forth in the CAISO Tariff. “Month” means a calendar month.
“MSCG” has the meaning specified in the first paragraph of this Agreement. “MSES” means Morgan Stanley Energy Structuring, L.L.C., a Delaware limited liability company.
“Person” means any individual, corporation, partnership, joint venture, trust, unincorporated organization, or Government Agency.
“PPA Buyer” has the meaning specified in the first paragraph of this Agreement. “PPA Seller” has the meaning specified in the first paragraph of this Agreement. “Prepaid Agreement” means that certain Prepaid Energy Sales Agreement dated as of [____] by and between MSES and Issuer.
“Prepay Power Supply Contract” means that certain Prepay Power Supply Contract dated [____] by and between PPA Buyer and Issuer.
“Receivables” has the meaning given to such term in Section 3(e). “Retained Rights and Obligations” has the meaning specified in Section 3. “Scheduling Coordinator” or “SC” means an entity certified by the CAISO as qualifying as a Scheduling Coordinator pursuant to the CAISO Tariff for the purposes of undertaking the functions specified in “Responsibilities of a Scheduling Coordinator,” of the CAISO Tariff, as amended from time to time.

2. Transfer and Undertakings.
(a) PPA Buyer hereby assigns, transfers and conveys to MSCG all right, title and interest in and to the rights of PPA Buyer under the PPA to receive delivery of the Assigned Attachment Staff Report Item 15D
4 Product during the Assignment Period. In connection with this assignment, PPA Buyer hereby delegates to MSCG the Assigned Rights and Obligations during the Assignment Period. (b) PPA Seller hereby consents and agrees to PPA Buyer’s assignment, transfer and conveyance of all right, title and interest in and to the Assigned Product and Assigned Rights and Obligations to MSCG and the exercise and performance by MSCG of the Assigned Rights and Obligations during the Assignment Period.
(c) MSCG hereby accepts such assignment, transfer and conveyance of the Assigned Rights and Obligations during the Assignment Period and agrees to perform any such Assigned Rights and Obligations due from it during the Assignment Period to the extent expressly set forth in this Agreement.

3. Limited Assignment.

Attachment Staff Report Item 15D
5 iii. Promptly following PPA Buyer’s receipt of each monthly invoice from PPA Seller during the Assignment Period and, in any event, no later than seven days thereafter, PPA Buyer shall deliver (i) a copy of such monthly invoice and the related supporting data to MSCG (ii) a statement to each of MSCG and the custodian described below indicating (A) the total amount due to PPA Seller under the PPA for such Month (the “Monthly Gross Amount”); (B) the Delivered Product Payment Obligation; and (C) the Retained Payment Obligation, which (I) shall be determined by subtracting the Delivered Product Payment Obligation from the Monthly Gross Amount and (II) shall reflect an amount due from PPA Buyer to the extent it is a positive number and an amount due to PPA Buyer to the extent it is a negative number. The Delivered Product Payment Obligation and Retained Payment Obligation shall be administered by a custodian who will pay (1) the Monthly Gross Amount to PPA Seller on each payment due date and (2) the absolute value of the Retained Payment Obligation to PPA Buyer to the extent such amount is negative for any given Month.
(b) Scheduling. All scheduling of Electricity associated with Assigned Product and other communications related to the PPA shall take place between PPA Buyer and PPA Seller pursuant to the terms of the PPA; provided that (i) title to Assigned Product will pass to MSCG upon delivery by PPA Seller at the Assigned Delivery Point in accordance with the PPA; (ii) immediately thereafter, title to such Assigned Product will pass to MSES, Issuer and then to PPA Buyer upon delivery by MSCG at the same point where title is passed to MSCG pursuant to clause (i) above; (iii) PPA Buyer will be deemed to be acting as MSCG’s agent with regard to scheduling Assigned Energy; provided, however, that PPA Buyer shall be entitled to retain for its own account all CAISO revenues associated with delivery of the Assigned Product to CAISO, including where PPA Buyer is acting as Scheduling Coordinator for the Facility (as defined in the PPA) and through scheduling of ISTs; and (iv) (A) PPA Buyer and PPA Seller will provide copies to MSCG of (I) any notice of force majeure delivered under the PPA and (II) any notice of a default or of a breach or other event that, if not cured within an applicable grace period, could result in a default; (B) PPA Seller will provide copies to MSCG of annual forecasts and monthly forecasts and generation reports delivered under the PPA; and (C) PPA Buyer and PPA Seller, as applicable, will provide copies to MSCG of any other information reasonably requested by MSCG relating to Assigned Product.
(c) Amendments. PPA Buyer and PPA Seller will provide written notice (including copies thereof) of any amendment, waiver, supplement, modification, or other changes to the PPA to MSCG relating to the Assigned Rights and Obligations, and the Parties hereby acknowledge and agree that an amendment, waiver, supplement, modification or other change will not have any effect on MSCG’s rights or obligations under this Agreement until and unless MSCG receives written notice thereof.
(d) Setoff of Receivables. Pursuant to the Prepaid Agreement, MSES has agreed to purchase the rights to payment of the net amounts owed by PPA Buyer under the Prepay Power Supply Contract (“Receivables”) in the case of non-payment by PPA Buyer. To the extent any such Receivables relate to Assigned Product purchased by MSCG pursuant to the Assigned Rights and Obligations, MSES may sell such Receivables to MSCG and MSCG may transfer such Receivables (excluding any penalties, late payment fees, late payment interest or other fees, costs or interest included in such Receivables) to PPA Seller and apply the face amount of such Attachment Staff Report Item 15D
6 Receivables (excluding any penalties, late payment fees, late payment interest or other fees, costs or interest included in such Receivables) as a reduction to any Delivered Product Payment Obligations; provided, however, that at no time shall PPA Seller be required to pay MSCG for any amounts by which such Receivables exceed any Delivered Product Payment Obligations then due and owed to PPA Seller.

4. Forward Contract.

The Parties acknowledge and agree that this Agreement constitutes a “forward contract” and that the Parties shall constitute “forward contract merchants” within the meaning of the United States Bankruptcy Code.

5. Assignment Period; Assignment Early Termination.
(a) Assignment Period. The “Assignment Period” shall begin on the Assignment Period Start Date and extend until the Assignment Period End Date; provided that in no event shall the Assignment Period extend past an Assignment Early Termination Date. (b) Early Termination. An “Assignment Early Termination Date” will occur under the following circumstances and as of the dates specified below:
i. the assignment of the Prepay Power Supply Contract by PPA Buyer or Issuer pursuant to Article XIII thereof, which Assignment Early Termination Date shall occur immediately as of the time of such assignment;
ii. the suspension, expiration, or termination of performance of the PPA by either PPA Buyer or PPA Seller for any reason other than the occurrence of Force Majeure under and as defined in the PPA, which Assignment Early Termination Date shall occur immediately as of the time of PPA Seller’s last performance under the PPA following such suspension, expiration, or termination;
iii. the election of MSCG in its sole discretion to declare an Assignment Early Termination Date as a result of (a) any event or circumstance that would give either PPA Buyer or PPA Seller the right to terminate or suspend performance under the PPA (regardless of whether PPA Buyer or PPA Seller exercises such right) or (b) the execution of an amendment, waiver, supplement, modification or other change to the PPA that adversely affects the Assigned Rights and Obligations or MSCG’s rights or obligations under this Agreement (provided that MSCG shall not have a right to terminate under this clause (b) to the extent that MSCG (i) receives prior notice of such change and (ii) provides its written consent thereto), which Assignment Early Termination Date shall occur upon the date set forth in a written notice of such election delivered by MSCG to PPA Buyer and PPA Seller;
iv. termination or suspension of deliveries for any reason other than force majeure under the Prepaid Agreement or Prepay Power Supply Contract, which Assignment Early Termination Date shall occur immediately as of the time of the last deliveries under the relevant contract following such suspension or termination; Attachment Staff Report Item 15D
7 v. the election of PPA Seller or PPA Buyer in its sole discretion to declare an Assignment Early Termination Date if MSCG fails to pay when due any amounts owed to PPA Seller in respect of any Delivered Product Payment Obligation and such failure continues for five Business Days following receipt by MSCG of written notice thereof, which Assignment Early Termination Date shall occur upon the date set forth in a written notice of such election delivered by PPA Seller or PPA Buyer, as applicable, to MSCG, and with a copy to PPA Buyer or PPA Seller, as applicable; vi. the election of PPA Seller or PPA Buyer in its sole discretion to declare an Assignment Early Termination Date if either (a) an involuntary case or other proceeding is commenced against MSCG seeking liquidation, reorganization or other relief with respect to it or its debts under any applicable Federal or State bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or similar law now or hereafter in effect or seeking the appointment of a custodian, receiver, liquidator, assignee, trustee, sequestrator or similar official of it or any substantial part of its property, and such involuntary case or other proceeding shall remain undismissed and unstayed, or an order or decree approving or ordering any of the foregoing is entered and continued unstayed and in effect, in any such event, for a period of 60 days, or (b) MSCG commences a voluntary case or proceeding under any applicable Federal or State bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or other similar law or any other case or proceeding to be adjudicated as bankrupt or insolvent, or MSCG consents to the entry of a decree or order for relief in an involuntary case or proceeding under any applicable Federal or State bankruptcy, insolvency, reorganization or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, files a petition or answer or consent seeking reorganization or relief under any applicable Federal or State law, or consents to the filing of such petition or to the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or similar official of MSCG or any substantial part of its property, or makes an assignment for the benefit of creditors, or admits in writing its inability to pay its debts generally as they become due, which Assignment Early Termination Date shall occur upon the earliest date set forth in a written notice of such election delivered by PPA Seller or PPA Buyer, as applicable, to MSCG, and with a copy to PPA Buyer or PPA Seller, as applicable; vii. either MSCG or PPA Buyer may designate an Assignment Early Termination Date with written notice to the other Parties to the extent that MSCG and PPA Buyer have mutually agreed upon a replacement Assignment Agreement (as defined in the Prepay Power Supply Contract) that will replace the Assigned Rights and Obligations hereunder immediately following the termination hereof, which Assignment Early Termination Date shall occur effective as of the end of the Month preceding the commencement of the “Assignment Period” under the replacement Assignment Agreement as specified in the notice from MSCG or PPA Buyer to the other Parties; and viii. PPA Buyer may deliver written notice of termination to the other Parties if any change, event or effect occurs, including but not limited a change in applicable laws or regulations, any issues with the PPA Seller or the PPA, a dispute under the PPA or other similar circumstance, that individually or collectively have or are reasonably expected by Attachment Staff Report Item 15D
8 PPA Buyer to have a material adverse effect upon (A) the PPA Buyer, (B) its rights and obligations under this Agreement, the Prepay Power Supply Contract, or the PPA, or (C) the benefit the PPA Buyer is receiving by assigning the Assigned Rights and Obligations, with such Assignment Early Termination Date to be the date set forth in a written notice delivered by PPA Buyer to the other Parties; provided that (x) PPA Buyer will provide notice to the other Parties as soon as is reasonably possible that PPA Buyer anticipates exercising this termination right, and (y) PPA Buyer shall exercise commercially reasonable efforts to propose and agree with MSCG upon a replacement Assignment Agreement prior to exercising this termination right.
(c) Reversion of Assigned Rights and Obligations. The parties acknowledge and agree that upon the occurrence of an Assignment Early Termination Date the Assigned Rights and Obligations will revert from MSCG to PPA Buyer. Any Assigned Rights and Obligations that would become due for payment or performance on or after such Assignment Early Termination Date shall immediately and automatically revert from MSCG to PPA Buyer, provided that (i) MSCG shall remain responsible for the Delivered Product Payment Obligation with respect to any Assigned Product delivered to MSCG prior to the Assignment Early Termination Date, and (ii) any legal restrictions on the effectiveness of such reversion (whether arising under bankruptcy law or otherwise) shall not affect the occurrence of the Assignment Early Termination Date.

6. Representations and Warranties.
(a) Copy of PPA. PPA Seller and PPA Buyer represent and warrant to MSCG that a true, complete, and correct copy of the PPA is attached hereto as Appendix 3. (b) No Default. PPA Seller and PPA Buyer represent and warrant to MSCG that no event or circumstance exists (or would exist with the passage of time or the giving of notice) that would give either of them the right to terminate the PPA or suspend performance thereunder. (c) Other. Each of PPA Buyer and PPA Seller represents and warrants to each other and to MSCG that:
i. it has made no prior transfer (whether by way of security or otherwise) of any interest in the Assigned Rights and Obligations; and ii. all obligations of PPA Buyer and PPA Seller under the PPA required to be performed on or before the Assignment Period Start Date have been fulfilled. (d) Representations. Each Party represents to each of the other Parties:
i. Status. It is duly organized and validly existing under the laws of the jurisdiction of its organization or incorporation and, if relevant under such laws, in good standing.
ii. Powers. It has the power to execute this Agreement and any other documentation relating to this Agreement to which it is a party, to deliver this Agreement and any other documentation relating to this Agreement that it is required by this Attachment Staff Report Item 15D
9 Agreement to deliver and to perform its obligations under this Agreement and has taken all necessary action to authorize such execution, delivery and performance. iii. No Violation or Conflict. Such execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby, including the incurrence by such Party of its obligations under this Agreement, will not result in any violation of, or conflict with: (i) any term of any material contract or agreement applicable to it; (ii) any of its charter, bylaws, or other constitutional documents; (iii) any determination or award of any arbitrator applicable to it; or (iv) any license, permit, franchise, judgment, writ, injunction or regulation, decree, order, charter, law, ordinance, rule or regulation of any Government Agency, applicable to it or any of its assets or properties or to any obligations incurred by it or by which it or any of its assets or properties or obligations are bound or affected, and shall not cause a breach of, or default under, any such term or result in the creation of any lien upon any of its properties or assets. iv. Consents. All consents, approvals, orders or authorizations of, registrations, declarations, filings or giving of notice to, obtaining of any licenses or permits from, or taking of any other action with respect to, any Person or Government Agency that are required to have been obtained by such Party with respect to this Agreement and the transactions contemplated hereby, including the due authorization of such Party and its governing body and any approval or consent of any security holder of such Party or any holder (or any trustee for any holder) of any indebtedness or other obligation of such Party, have been obtained and are in full force and effect and all conditions of any such consents have been complied with. v. Obligations Binding. Its obligations under this Agreement constitute its legal, valid and binding obligations, enforceable in accordance with their respective terms (subject to applicable bankruptcy, reorganization, insolvency, moratorium or similar laws affecting creditors’ rights generally and subject, as to enforceability, to equitable principles of general application (regardless of whether enforcement is sought in a proceeding in equity or at law)).
vi. Non-Reliance. It is acting for its own account, and it has made its own independent decisions to enter into this Agreement and as to whether this Agreement is appropriate or proper for it based upon its own judgment and upon advice from such advisers as it has deemed necessary. It is not relying on any communication (written or oral) of the other Parties as investment advice or as a recommendation to enter into this Agreement; it being understood that information and explanations related to the terms and conditions of this Agreement shall not be considered investment advice or a recommendation to enter into this Agreement. It is entering into this Agreement as a bona-fide, arm’s-length transaction involving the mutual exchange of consideration and, once executed by all Parties, considers this Agreement a legally enforceable contract. No communication (written or oral) received from any of the other Parties shall be deemed to be an assurance or guarantee as to the expected results of this Agreement. vii. Assessment and Understanding. It is capable of assessing the merits of and understanding (on its own behalf or through independent professional advice), and Attachment Staff Report Item 15D
10 understands and accepts, the terms, conditions and risks of this Agreement. It is also capable of assuming, and assumes, the risks of this Agreement. viii. Status of Parties. None of the other Parties is acting as a fiduciary for or an adviser to it in respect of this Agreement.

7. Counterparts.

This Agreement (and each amendment, modification and waiver in respect of it) may be executed and delivered in counterparts (including by facsimile or electronic transmission), each of which will be deemed an original.

8. Costs and Expenses.

The Parties will each pay their own costs and expenses (including legal fees) incurred in connection with this Agreement and as a result of the negotiation, preparation, and execution of this Agreement.

9. Amendments.

No amendment, modification, or waiver in respect of this Agreement will be effective unless in writing (including a writing evidenced by an electronic transmission) and executed by each of the Parties or confirmed by emails or electronic messages on an electronic messaging system.

10. Notices.

Any notice, demand, statement or request required or authorized by this Agreement to be given by one Party to another shall be in writing, except as otherwise expressly provided herein. It shall be sent by email transmission, courier, or personal delivery (including overnight delivery service) to each of the notice recipients and addresses for each of the other Parties designated in Appendix 2 hereto. Any such notice, demand, or request shall be deemed to be given (i) when sent by email transmission, or (ii) when actually received if delivered by courier or personal delivery (including overnight delivery service). Each Party shall have the right, upon 10 days’ prior written notice to the other Parties, to change its address at any time, and to designate that copies of all such notices be directed to another person at another address. The Parties may mutually agree in writing at any time to deliver notices, demands or requests through alternate or additional methods.

Notwithstanding the foregoing, any Party may at any time notify the other Parties that any notice, demand, statement or request to it must be provided by email transmission for a specified period of time or until further notice, and any communications delivered by means other than email transmission during such time shall be ineffective.

If the MSCG and PPA Buyer-selected arbitrators are unable or fail to agree upon a chairperson, the chairperson shall be appointed by JAMS. The chairperson shall be a person who has experience in renewable energy-related transactions, and none of the arbitrators shall have been previously employed by any Party or have any direct pecuniary interest in any Party or the subject matter of the arbitration, unless such conflict is expressly acknowledged and waived in writing by all of the Parties. The Parties shall maintain the confidential nature of the arbitration proceeding and any award, including any hearing(s), except as may be necessary to prepare for or conduct the arbitration hearing on the merits, or except as necessary in connection with a court application for a preliminary remedy, a judicial challenge to an award or its enforcement, or unless otherwise required by law or judicial decision. Any arbitration proceedings, decision or award rendered hereunder and the validity, effect and interpretation of this arbitration provision shall be governed by the Federal Arbitration Act. The arbitrator(s) shall have no authority to award consequential, treble, exemplary, or punitive damages of any type or kind regardless of whether such damages may be available under any law or right, with the Parties hereby affirmatively waiving their rights, if any, to recover or claim such damages. In any arbitration arising out of or related to this Agreement, the arbitrators shall award to the prevailing Party or Parties, if any, the costs and attorney’s fees reasonably incurred in seeking to enforce the application of this Section 11(d) and by the prevailing party in connection with the arbitration. Notwithstanding the foregoing provisions of this Section 11(d), any costs incurred by a Party in seeking judicial enforcement of any written decision of the arbitrators shall be chargeable to and borne exclusively by the Party against whom such court order is obtained. The award shall be final and binding on the Parties and judgment upon any award may be entered in any court of competent jurisdiction.

Attachment Staff Report Item 15D
12 (e) Judicial Reference. Without limiting the provisions in Section 11(d), if Section 11(d) is deemed ineffective or unenforceable in any respect, any dispute between the Parties arising out of or in connection with this Agreement or its performance, breach, or termination (including the existence, validity and interpretation of this Agreement and the applicability of any statute of limitation period) (each, a “Dispute”) shall be resolved by a reference proceeding in California in accordance with the provisions of Sections 638 et seq. of the California Code of Civil Procedure (“CCP”), or their successor sections (a “Reference Proceeding”), which shall constitute the exclusive remedy for the resolution of any Dispute. As a condition precedent to initiating a Reference Proceeding with respect to any Dispute, the Parties shall comply with the provisions of Section 11(e)(i).
i. Notice of Dispute. Prior to initiating the Reference Proceeding, a Party (the “Disputing Party”) shall provide the other Parties (the “Responding Parties”) with a written notice of each issue in dispute, a proposed means for resolving each such issue, and support for such position (the “Notice of Dispute”). Within 10 days after receiving the Notice of Dispute, the Responding Parties shall provide the Disputing Party with a written Notice of each additional issue (if any) with respect to the dispute raised by the Notice of Dispute, a proposed means for resolving every issue in dispute, and support for such position (the “Dispute Response”). Thereafter, the Parties shall meet to discuss the matter and attempt in good faith to reach a negotiated resolution of the dispute. If the Parties do not resolve the dispute by unanimous agreement within sixty 60 days after receipt of the Dispute Response, (the “Negotiation Period”), then any Party may provide to the other Parties written notice of intent for judicial reference (the “Impasse Notice”) in accordance with the further provisions of this Section 11.
ii. Applicability; Selection of Referees.
(A) Within 10 days of the delivery of an Impasse Notice, each of MSCG and PPA Buyer shall nominate one (1) referee. The two (2) referees (the “Party-Appointed Referees”) shall appoint a third referee (the “Third Referee”, together with the Party-Appointed Referees, the “Referees”). The Party-Appointed Referees shall be competent and experienced in matters involving the electric energy business in the United States, with at least ten (10) years of electric industry experience as a practicing attorney. The Third Referee shall be an active or retired California state or federal judge. Each of the Party-Appointed Referees and the Third Referee shall be impartial and independent of each of the Parties and of the other referees and not employed by any of the Parties in any prior matter. (B) If the Party-Appointed Referees are unable to agree on the Third Referee within 45 days from delivery of the Impasse Notice, then the Third Referee shall be appointed pursuant to CCP Section 640(b) in an action filed in the Superior Court of California, County of San Francisco (the “Court”), and with due regard given to the selection criteria above. A request for appointment of a referee may be heard on an ex parte or expedited basis, and the Parties agree that irreparable harm would result if ex parte relief is not granted. Pursuant to CCP Section 170.6, each of PPA Buyer and MSCG shall have one (1) peremptory challenge to the referee selected by the Court.

Attachment Staff Report Item 15D
13 iii. Discovery; Proceedings.
(A) The Parties agree that time is of the essence in conducting the Reference Proceeding. Accordingly, the referees shall be requested, subject to change in the time periods specified herein for good cause shown, to (i) set the matter for a status and trial-setting conference within 20 days after the date of selection of the Third Referee, (ii) if practicable, try all issues of law or fact within 180 days after the date of the conference, and (iii) report a statement of decision within 20 days after the matter has been submitted for decision. (B) Discovery and other pre-hearing procedures shall be conducted as agreed to by the Parties, or if they cannot agree, as determined by the Third Referee after discussion with the Parties regarding the need for discovery and other pre-hearing procedures. (C) Except as expressly set forth herein, the Third Referee shall determine the manner in which the Reference Proceeding is conducted, including the time and place of hearings, the order of presentation of evidence, and all other questions that arise with respect to the course of the Reference Proceeding. The Reference Proceeding, including the trial, shall be conducted at a neutral location selected by the Parties, or if not agreed by the Parties, by the Third Referee, in San Francisco, California.
(D) All proceedings and hearings conducted before the referees, except for trial, shall be conducted without a court reporter, except that when any Party so requests, a court reporter will be used at any hearing conducted before the referees, and the referees will be provided a courtesy copy of the transcript. The Party making such a request shall have the obligation to arrange for and pay the court reporter.
iv. Decision. The referees shall render a written statement of decision setting forth findings of fact and conclusions of law. The decision shall be entered as a judgment in the court in accordance with the provisions of CCP Sections 644 and 645. The decision shall be appealable to the same extent and in the same manner that such decision would be appealable if rendered by a judge of the Court. The Parties intend this general reference agreement to be specifically enforceable in accordance with the CCP. v. Expenses. Each of MSCG and PPA Buyer shall bear the compensation and expenses of its respective Party-Appointed Referee, own counsel, witnesses, consultants and employees. All other expenses of judicial reference shall be split equally between MSCG and PPA Buyer.

Attachment Staff Report Item 15D
Signature Page to Limited Assignment Agreement
IN WITNESS WHEREOF, the Parties have executed this Agreement effective as of the date first set forth above.
[PPA SELLER]
By: ____________________________
Name:_______________________
Title:________________________

EAST BAY COMMUNITY ENERGY AUTHORITY
By: ____________________________
Name:_______________________
Title:________________________
MORGAN STANLEY CAPITAL GROUP INC.

By: ____________________________
Name:_______________________
Title:________________________
Attachment Staff Report Item 15D
Appendix 1 - 1
Appendix 1
Assigned Rights and Obligations
PPA: Renewable Power Purchase Agreement dated as of [____], by and between PPA Buyer and PPA Seller
Assigned Delivery Point: [Facility PNode/Settlement Point (as defined in the PPA)] Further Information: PPA Seller shall continue to transfer the WREGIS Certificates associated with all Renewable Energy Credits corresponding to all Facility Energy under the PPA, provided that the transferee of such WREGIS Certificates may be changed from time to time in accordance with the written instructions of both MSCG and PPA Buyer upon fifteen (15) Business Days’ notice, which change shall be effective as of the first day of the next calendar month, unless otherwise agreed. Terms with initial capitalization used in this paragraph but not otherwise defined in this Agreement have the meaning set forth in the PPA. [Include additional requirements, if any]
Attachment Staff Report Item 15D
Appendix 2 - 1
Appendix 2
Notice Information
[To be completed before signing.]
Attachment Staff Report Item 15D
Appendix 3 - 1
Appendix 3
Copy of Power Sales Contract
[To be attached.]
Attachment Staff Report Item 15D

EXHIBIT B

FORM OF LIMITED ASSIGNMENT AGREEMENT FOR MSCG AS PPA SUPPLIER This Limited Assignment Agreement (this “Agreement”) is entered into as of [____] by and among Morgan Stanley Capital Group Inc., a Delaware corporation (“PPA Seller”), East Bay Community Energy Authority, a joint powers authority and a community choice aggregator organized under the laws of the State of California (“PPA Buyer”), California Community Choice Financing Authority, a joint powers authority and a public entity of the State of California established pursuant to the provisions of the Joint Exercise of Powers Act (Article 1, Chapter 5, Division 7, Title 1, Section 6500 et seq. of the California Government Code, as amended) (“Issuer”), and Morgan Stanley Energy Structuring, L.L.C., a Delaware limited liability company (“MSES”).

RECITALS
WHEREAS, PPA Buyer and PPA Seller are parties to that certain [____], dated as of [____] (the “PPA”);
WHEREAS, in connection with a prepaid electricity transaction between Issuer and MSES, and with effect from and including the Assignment Period Start Date (as defined below), PPA Buyer wishes to transfer by limited assignment to MSES, and MSES wishes to accept the transfer by limited assignment of, the Assigned Rights and Obligations (as defined below) for the duration of the Assignment Period (as defined below); and
WHEREAS, pursuant to this Agreement, MSES will receive the Assigned Product and MSES will deliver the Assigned Product to MSES, which will redeliver the Assigned Product to Issuer for ultimate redelivery to PPA Buyer; and
WHEREAS, pursuant to this Agreement, MSES will assume responsibility for the Delivered Product Payment Obligation.

THEREFORE, in consideration of the premises above and the mutual covenants and agreements herein set forth, Issuer, PPA Seller, PPA Buyer and MSES (the “Parties” hereto; each is a “Party”) agree as follows:

AGREEMENT

1. Definitions.

Attachment Staff Report Item 15D
2 “Assigned Energy” means any Electricity associated with the Assigned Product to be delivered to MSES hereunder pursuant to the Assigned Rights and Obligations. “Assigned Quantity” means all Assigned Product delivered in accordance with the PPA by PPA Seller in each year during the Assignment Period. “Assigned Product” includes all [Specified Source Energy]/[Carbon Free Energy] (as defined in the PPA) associated with the Assigned Quantity. “Assigned Product Price” means the [Energy Price]/[Flat Price] (as defined in the PPA and specified in Appendix 1).
“Assigned Rights and Obligations” means (i) the rights of PPA Buyer under the PPA to receive the Assigned Quantity of Assigned Product during the Assignment Period, as such rights may be limited or further described in the “Further Information” section on Appendix 1, and (ii) the Delivered Product Payment Obligation, which right and obligation are transferred and conveyed to MSES hereunder.
“Assignment Early Termination Date” has the meaning specified in Section 5(b). “Assignment Period” has the meaning specified in Section 5(a). “Assignment Period End Date” means 11:59:59 p.m. pacific prevailing time on [____]. “Assignment Period Start Date” means [_____].
“Business Day” means any day except a Saturday, Sunday, or a Federal Reserve Bank holiday. A Business Day begins at 8:00 a.m. and ends at 5:00 p.m. local time for the Party sending a notice, or payment, or performing a specified action. “CAISO Tariff” means the California Independent System Operator Corporation Agreement and Tariff, Business Practice Manuals (BPMs), and Operating Procedures, including the rules, protocols, procedures and standards attached thereto, as the same may be amended or modified from time-to-time and approved by the Federal Energy Regulatory Commission. “Claims” means all claims or actions, threatened or filed, and the resulting losses, damages, expenses, attorneys’ fees, experts’ fees, and court costs, whether incurred by settlement or otherwise, and whether such claims or actions are threatened or filed prior to or after the termination of this Agreement, in each case arising under, in respect of or related in any way to the PPA or any transaction thereunder, except for the Delivered Product Payment Obligation. “Delivered Product Payment Obligation” has the meaning specified in Section 3(a). “Electricity” means three-phase, 60-cycle alternating current electric energy, expressed in megawatt hours (MWh).

Attachment Staff Report Item 15D
3 “Government Agency” means the United States of America, any state thereof, any municipality, or any local jurisdiction, or any political subdivision of any of the foregoing, including, but not limited to, courts, administrative bodies, departments, commissions, boards, bureaus, agencies, or instrumentalities.
“Issuer” has the meaning specified in the first paragraph of this Agreement. “Inter-SC Trade” or “IST” has the meaning set forth in the CAISO Tariff. “Month” means a calendar month.
“MSES” has the meaning specified in the first paragraph of this Agreement. “Person” means any individual, corporation, partnership, joint venture, trust, unincorporated organization, or Government Agency.
“PPA Buyer” has the meaning specified in the first paragraph of this Agreement. “PPA Seller” has the meaning specified in the first paragraph of this Agreement. “Prepaid Agreement” means that certain Prepaid Energy Sales Agreement dated as of [____] by and between MSES and Issuer.
“Prepay Power Supply Contract” means that certain Prepay Power Supply Contract dated [____] by and between PPA Buyer and Issuer.
“Receivables” has the meaning given to such term in Section 3(e). “Retained Rights and Obligations” has the meaning specified in Section 3. “Scheduling Coordinator” or “SC” means an entity certified by the CAISO as qualifying as a Scheduling Coordinator pursuant to the CAISO Tariff for the purposes of undertaking the functions specified in “Responsibilities of a Scheduling Coordinator,” of the CAISO Tariff, as amended from time to time.

Attachment Staff Report Item 15D
4 (c) MSES hereby accepts such assignment, transfer and conveyance of the Assigned Rights and Obligations during the Assignment Period and agrees to perform any such Assigned Rights and Obligations due from it during the Assignment Period to the extent expressly set forth in this Agreement.

3. Limited Assignment.

The Parties acknowledge and agree that (i) the Assigned Rights and Obligations include only a portion of PPA Buyer’s rights and obligations under the PPA, and that all rights and obligations arising under the PPA that are not expressly included in the Assigned Rights and Obligations shall be “Retained Rights and Obligations”, and (ii) the Retained Rights and Obligations include all rights and obligations of PPA Buyer arising during the Assignment Period except the rights and obligations expressly included in the Assigned Rights and Obligations. In this regard:
(a) Limited to Delivered Product Payment Obligation; Invoicing. i. MSES’s sole obligation to PPA Seller will be to pay the Assigned Product Price to PPA Seller for the Assigned Product delivered during each Month of the Assignment Period on each applicable payment date under Section [4.2] of the Confirmation to the PPA for a quantity determined under this Section 3(a)i (the “Delivered Product Payment Obligation”). PPA Buyer shall remain solely responsible for any payment obligations other than the Delivered Product Payment Obligation due under the PPA during the Assignment Period (the “Retained Payment Obligation”). For purposes of determining the Delivered Product Payment Obligation and other related payment obligations during the Assignment Period, each Party acknowledges and agrees as follows:
(A) the PPA provides for the delivery of the Assigned Quantity on an annual basis, but, notwithstanding the foregoing, the Assigned Quantity shall be settled on a monthly basis by multiplying the [Hourly Quantity (as defined in the PPA)] the number CAISO Energy Delivery Hours (as defined in the PPA) in each month (the “Settlement Monthly Quantity”), for purposes of determining amounts due under this Agreement, the Prepay Power Supply Contract and the Prepaid Agreement for each month of the Assignment Period (as futher described below); (B) regardless of the Assigned Quantity actually delivered in any month during the Assignment Period, (I) the Delivered Product Payment Obligation shall be an amount equal to the result of (x) the Settlement Monthly Quantity, multiplied by (y) the Assigned Product Price; and (II) the payment due from PPA Buyer to Issuer under the Prepay Power Supply Contract shall be an amount equal to the result of (x) the Settlement Monthly Quantity, multiplied by (y) the Contract Price (as defined in the Prepay Power Supply Contract); and
(C) to the extent that (I) an amount less than the Annual Quantity (as defined in the PPA) has been delivered as of the end of December for any year during the Assignment Period or (II) an Assignment Early Termination Date occurs and the Assigned Quantity actually delivered prior to such date is less than the Settlement Monthly Quantity through such date (any such shortfall amount under Attachment Staff Report Item 15D
5 clauses (I) or (II), an “Assigned Shortfall Quantity”), then PPA Buyer will be deemed to have remarketed the Assigned Shortfall Quantity in a Private Business Sale (as defined in Exhibit C to the Prepaid Agreement), and MSES will record any such Assigned Shortfall Quantity as a Ledger Entry on the Private Business Sales Ledger (as each such term is defined in Exhibit C to the Prepaid Agreement effective as of the first day of the month of December or the month in which an Assignment Early Termination Date occurs, as applicable; provided in addition that, notwithstanding anything to the contrary in the Prepaid Agreement, MSES shall have no remarketing payment obligations with respect to any such Assigned Shortfall Quantity.
ii. PPA Seller shall deliver each monthly invoice and related supporting data during the Assignment Period to each of PPA Buyer and MSES, and each such invoice shall indicate (A) the total amount due to PPA Seller under the PPA for such Month (the “Monthly Gross Amount”); (B) the Delivered Product Payment Obligation; and (C) the Retained Payment Obligation, which (I) shall be determined by subtracting the Delivered Product Payment Obligation from the Monthly Gross Amount and (II) shall reflect an amount due from PPA Buyer to the extent it is a positive number and an amount due to PPA Buyer to the extent it is a negative number; provided in addition that any payment adjustments or subsequent reconciliations occurring after the date that is 10 days prior to the payment due date for a monthly invoice will be resolved solely between PPA Buyer and PPA Seller. The Delivered Product Payment Obligation and Retained Payment Obligation shall be administered by a custodian who will pay (1) the Monthly Gross Amount to PPA Seller on each payment due date and (2) the absolute value of the Retained Payment Obligation to PPA Buyer to the extent such amount is negative for any given Month.
(b) Retained Rights and Obligations. Any Claims (other than the Delivered Product Payment Obligation or a failure to perform the same) arising or existing in connection with or related to the PPA, whether related to performance by PPA Seller, PPA Buyer or MSES, and whether arising before, during or after the Assignment Period, in each case excluding the Delivered Product Payment Obligation, will be included in the Retained Rights and Obligations and any such Claims will be resolved exclusively between PPA Seller and PPA Buyer in accordance with the PPA.
(c) Scheduling. All scheduling of Electricity associated with Assigned Product and other communications related to the PPA shall take place between PPA Buyer and PPA Seller pursuant to the terms of the PPA; provided that (i) title to Assigned Product will pass to MSES upon delivery by PPA Seller at the Assigned Delivery Point in accordance with the PPA; (ii) immediately thereafter, title to such Assigned Product will pass to MSES, Issuer and then to PPA Buyer upon delivery by MSES at the same point where title is passed to MSES pursuant to clause (i) above; (iii) PPA Buyer will be deemed to be acting as MSES’s agent with regard to scheduling Assigned Energy; provided, however, that PPA Buyer shall be entitled to retain for its own account all CAISO revenues associated with delivery of the Assigned Product to CAISO, including where PPA Buyer is acting as Scheduling Coordinator for the Facility (as defined in the PPA) and through scheduling of ISTs; and (iv) (A) PPA Buyer and PPA Seller will provide copies to MSES of (I) any notice of force majeure delivered under the PPA and (II) any notice of a default or of a breach Attachment Staff Report Item 15D
6 or other event that, if not cured within an applicable grace period, could result in a default; (B) PPA Seller will provide copies to MSES of annual forecasts and monthly forecasts and generation reports delivered under the PPA; and (C) PPA Buyer and PPA Seller, as applicable, will provide copies to MSES of any other information reasonably requested by MSES relating to Assigned Product.
(d) Amendments. PPA Buyer and PPA Seller will provide written notice (including copies thereof) of any amendment, waiver, supplement, modification, or other changes to the PPA to MSES relating to the Assigned Rights and Obligations, and the Parties hereby acknowledge and agree that an amendment, waiver, supplement, modification or other change will not have any effect on MSES’s rights or obligations under this Agreement until and unless MSES receives written notice thereof.
(e) Setoff of Receivables. Pursuant to the Prepaid Agreement, MSES has agreed to purchase the rights to payment of the net amounts owed by PPA Buyer under the Prepay Power Supply Contract (“Receivables”) in the case of non-payment by PPA Buyer. To the extent any such Receivables relate to Assigned Product purchased by MSES pursuant to the Assigned Rights and Obligations, MSES may transfer such Receivables (excluding any penalties, late payment fees, late payment interest or other fees, costs or interest included in such Receivables) to PPA Seller and apply the face amount of such Receivables (excluding any penalties, late payment fees, late payment interest or other fees, costs or interest included in such Receivables) as a reduction to any Delivered Product Payment Obligations; provided, however, that at no time shall PPA Seller be required to pay MSES for any amounts by which such Receivables exceed any Delivered Product Payment Obligations then due and owed to PPA Seller.
(f) Joinder to Intercreditor Agreement. In connection with the execution of this Agreement and as a condition precedent to the effectiveness hereof, Issuer shall execute a joinder to the Intercreditor and Collateral Agency Agreement (as defined in the PPA), which will provide Issuer with certain rights under the Security Documents (as defined in the PPA). PPA Buyer agrees that it shall make payments with respect to the Assigned Quantity to Issuer under the Prepay Power Supply Contract on the 20th or preceding business day of the month following deliveries consistent with the terms thereof, and such payments will be made from PPA Buyer’s available funds not pledged to the Special Fund (as defined in the PPA); provided that, in the event PPA Buyer fails to make any such payment when due, PPA Buyer shall cause such payment due to Issuer to be included as Regular Charges (as defined in the Security Documents) on the first Distribution Date Certificate (as defined in the Security Documents) to be issued thereafter. If PPA Buyer fails to do so, Issuer shall dispute such Distribution Date Certificate and otherwise pursue its rights to payment thereon pursuant to the terms of the Intercreditor and Collateral Agency Agreement. To the extent Issuer receives any amounts under the Security Documents or Intercreditor and Collateral Agency Agreement in respect of any Receivables purchased by MSES, Issuer shall (i) hold such amounts in trust for the benefit of MSES, (ii) promptly notify MSES thereof and (iii) promptly remit such amounts directly to an account specified by MSES.

4. Forward Contract.

Attachment Staff Report Item 15D
7 The Parties acknowledge and agree that this Agreement constitutes a “forward contract” and that the Parties shall constitute “forward contract merchants” within the meaning of the United States Bankruptcy Code.

5. Assignment Period; Assignment Early Termination.
(a) Assignment Period. The “Assignment Period” shall begin on the Assignment Period Start Date and extend until the Assignment Period End Date; provided that in no event shall the Assignment Period extend past an Assignment Early Termination Date. (b) Early Termination. An “Assignment Early Termination Date” will occur under the following circumstances and as of the dates specified below:
i. the assignment of the Prepay Power Supply Contract by PPA Buyer or Issuer pursuant to Article XIII thereof, which Assignment Early Termination Date shall occur immediately as of the time of such assignment;
ii. the suspension, expiration, or termination of performance of the PPA by either PPA Buyer or PPA Seller for any reason other than the occurrence of Force Majeure under and as defined in the PPA, which Assignment Early Termination Date shall occur immediately as of the time of PPA Seller’s last performance under the PPA following such suspension, expiration, or termination;
iii. the election of MSES in its sole discretion to declare an Assignment Early Termination Date as a result of (a) any event or circumstance that would give either PPA Buyer or PPA Seller the right to terminate or suspend performance under the PPA (regardless of whether PPA Buyer or PPA Seller exercises such right) or (b) the execution of an amendment, waiver, supplement, modification or other change to the PPA that adversely affects the Assigned Rights and Obligations or MSES’s rights or obligations under this Agreement (provided that MSES shall not have a right to terminate under this clause (b) to the extent that MSES (i) receives prior notice of such change and (ii) provides its written consent thereto), which Assignment Early Termination Date shall occur upon the date set forth in a written notice of such election delivered by MSES to PPA Buyer and PPA Seller;
iv. termination or suspension of deliveries for any reason other than force majeure under the Prepaid Agreement or Prepay Power Supply Contract, which Assignment Early Termination Date shall occur immediately as of the time of the last deliveries under the relevant contract following such suspension or termination; v. the election of PPA Seller or PPA Buyer in its sole discretion to declare an Assignment Early Termination Date if MSES fails to pay when due any amounts owed to PPA Seller in respect of any Delivered Product Payment Obligation and such failure continues for five Business Days following receipt by MSES of written notice thereof, which Assignment Early Termination Date shall occur upon the date set forth in a written notice of such election delivered by PPA Seller or PPA Buyer, as applicable, to MSES, and with a copy to PPA Buyer or PPA Seller, as applicable;
Attachment Staff Report Item 15D
8 vi. the election of PPA Seller or PPA Buyer in its sole discretion to declare an Assignment Early Termination Date if either (a) an involuntary case or other proceeding is commenced against MSES seeking liquidation, reorganization or other relief with respect to it or its debts under any applicable Federal or State bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or similar law now or hereafter in effect or seeking the appointment of a custodian, receiver, liquidator, assignee, trustee, sequestrator or similar official of it or any substantial part of its property, and such involuntary case or other proceeding shall remain undismissed and unstayed, or an order or decree approving or ordering any of the foregoing is entered and continued unstayed and in effect, in any such event, for a period of 60 days, or (b) MSES commences a voluntary case or proceeding under any applicable Federal or State bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or other similar law or any other case or proceeding to be adjudicated as bankrupt or insolvent, or MSES consents to the entry of a decree or order for relief in an involuntary case or proceeding under any applicable Federal or State bankruptcy, insolvency, reorganization or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, files a petition or answer or consent seeking reorganization or relief under any applicable Federal or State law, or consents to the filing of such petition or to the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or similar official of MSES or any substantial part of its property, or makes an assignment for the benefit of creditors, or admits in writing its inability to pay its debts generally as they become due, which Assignment Early Termination Date shall occur upon the earliest date set forth in a written notice of such election delivered by PPA Seller or PPA Buyer, as applicable, to MSES, and with a copy to PPA Buyer or PPA Seller, as applicable;
vii. either MSES or PPA Buyer may designate an Assignment Early Termination Date with written notice to the other Parties to the extent that MSES and PPA Buyer have mutually agreed upon a replacement Assignment Agreement (as defined in the Prepay Power Supply Contract) that will replace the Assigned Rights and Obligations hereunder immediately following the termination hereof, which Assignment Early Termination Date shall occur effective as of the end of the Month preceding the commencement of the “Assignment Period” under the replacement Assignment Agreement as specified in the notice from MSES or PPA Buyer to the other Parties; and viii. PPA Buyer may deliver written notice of termination to the other Parties if any change, event or effect occurs, including but not limited a change in applicable laws or regulations, any issues with the PPA Seller or the PPA, a dispute under the PPA or other similar circumstance, that individually or collectively have or are reasonably expected by PPA Buyer to have a material adverse effect upon (A) the PPA Buyer, (B) its rights and obligations under this Agreement, the Prepay Power Supply Contract, or the PPA, or (C) the benefit the PPA Buyer is receiving by assigning the Assigned Rights and Obligations, with such Assignment Early Termination Date to be the date set forth in a written notice delivered by PPA Buyer to the other Parties; provided that (x) PPA Buyer will provide notice to the other Parties as soon as is reasonably possible that PPA Buyer anticipates exercising this termination right, and (y) PPA Buyer shall exercise commercially Attachment Staff Report Item 15D
9 reasonable efforts to propose and agree with MSES upon a replacement Assignment Agreement prior to exercising this termination right.
(c) Reversion of Assigned Rights and Obligations. The parties acknowledge and agree that upon the occurrence of an Assignment Early Termination Date the Assigned Rights and Obligations will revert from MSES to PPA Buyer. Any Assigned Rights and Obligations that would become due for payment or performance on or after such Assignment Early Termination Date shall immediately and automatically revert from MSES to PPA Buyer, provided that (i) MSES shall remain responsible for the Delivered Product Payment Obligation with respect to any Assigned Product delivered to MSES prior to the Assignment Early Termination Date, and (ii) any legal restrictions on the effectiveness of such reversion (whether arising under bankruptcy law or otherwise) shall not affect the occurrence of the Assignment Early Termination Date.

6. Representations and Warranties.
(a) Copy of PPA. PPA Seller and PPA Buyer represent and warrant to MSES that a true, complete, and correct copy of the PPA is attached hereto as Appendix 3. (b) No Default. PPA Seller and PPA Buyer represent and warrant to MSES that no event or circumstance exists (or would exist with the passage of time or the giving of notice) that would give either of them the right to terminate the PPA or suspend performance thereunder. (c) Other. Each of PPA Buyer and PPA Seller represents and warrants to each other and to MSES that:
i. it has made no prior transfer (whether by way of security or otherwise) of any interest in the Assigned Rights and Obligations; and ii. all obligations of PPA Buyer and PPA Seller under the PPA required to be performed on or before the Assignment Period Start Date have been fulfilled. (d) Representations. Each Party represents to each of the other Parties:
i. Status. It is duly organized and validly existing under the laws of the jurisdiction of its organization or incorporation and, if relevant under such laws, in good standing.
ii. Powers. It has the power to execute this Agreement and any other documentation relating to this Agreement to which it is a party, to deliver this Agreement and any other documentation relating to this Agreement that it is required by this Agreement to deliver and to perform its obligations under this Agreement and has taken all necessary action to authorize such execution, delivery and performance. iii. No Violation or Conflict. Such execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby, including the incurrence by such Party of its obligations under this Agreement, will not result in any violation of, or conflict with: (i) any term of any material contract or agreement applicable to it; (ii) any of its charter, bylaws, or other constitutional documents; (iii) any Attachment Staff Report Item 15D
10 determination or award of any arbitrator applicable to it; or (iv) any license, permit, franchise, judgment, writ, injunction or regulation, decree, order, charter, law, ordinance, rule or regulation of any Government Agency, applicable to it or any of its assets or properties or to any obligations incurred by it or by which it or any of its assets or properties or obligations are bound or affected, and shall not cause a breach of, or default under, any such term or result in the creation of any lien upon any of its properties or assets. iv. Consents. All consents, approvals, orders or authorizations of, registrations, declarations, filings or giving of notice to, obtaining of any licenses or permits from, or taking of any other action with respect to, any Person or Government Agency that are required to have been obtained by such Party with respect to this Agreement and the transactions contemplated hereby, including the due authorization of such Party and its governing body and any approval or consent of any security holder of such Party or any holder (or any trustee for any holder) of any indebtedness or other obligation of such Party, have been obtained and are in full force and effect and all conditions of any such consents have been complied with. v. Obligations Binding. Its obligations under this Agreement constitute its legal, valid and binding obligations, enforceable in accordance with their respective terms (subject to applicable bankruptcy, reorganization, insolvency, moratorium or similar laws affecting creditors’ rights generally and subject, as to enforceability, to equitable principles of general application (regardless of whether enforcement is sought in a proceeding in equity or at law)).
vi. Non-Reliance. It is acting for its own account, and it has made its own independent decisions to enter into this Agreement and as to whether this Agreement is appropriate or proper for it based upon its own judgment and upon advice from such advisers as it has deemed necessary. It is not relying on any communication (written or oral) of the other Parties as investment advice or as a recommendation to enter into this Agreement; it being understood that information and explanations related to the terms and conditions of this Agreement shall not be considered investment advice or a recommendation to enter into this Agreement. It is entering into this Agreement as a bona-fide, arm’s-length transaction involving the mutual exchange of consideration and, once executed by all Parties, considers this Agreement a legally enforceable contract. No communication (written or oral) received from any of the other Parties shall be deemed to be an assurance or guarantee as to the expected results of this Agreement. vii. Assessment and Understanding. It is capable of assessing the merits of and understanding (on its own behalf or through independent professional advice), and understands and accepts, the terms, conditions and risks of this Agreement. It is also capable of assuming, and assumes, the risks of this Agreement. viii. Status of Parties. None of the other Parties is acting as a fiduciary for or an adviser to it in respect of this Agreement.

7. Counterparts.

Attachment Staff Report Item 15D
11 This Agreement (and each amendment, modification and waiver in respect of it) may be executed and delivered in counterparts (including by facsimile or electronic transmission), each of which will be deemed an original.

8. Costs and Expenses.

9. Amendments.

10. Notices.

11. Miscellaneous.
(a) Governing Law. This Agreement and the rights and duties of the Parties under this Agreement will be governed by and construed, enforced and performed in accordance with the laws of the state of New York, without reference to any conflicts of laws provisions that would direct the application of another jurisdiction’s laws; provided, however, that the authority of PPA Buyer to enter into and perform its obligations under this agreement shall be determined in accordance with the laws of the state of California.
(b) U.S. Resolution Stay. The Parties hereby confirm that they are adherents to the ISDA 2018 U.S. Resolution Stay Protocol (“ISDA U.S. Stay Protocol”), the terms of the ISDA U.S. Stay Protocol are incorporated into and form a part of this Agreement, and this Agreement shall be deemed a Protocol Covered Agreement for purposes thereof. For purposes of incorporating the ISDA U.S. Stay Protocol, MSES and PPA Seller shall each be deemed to be a Attachment Staff Report Item 15D
12 Regulated Entity, and PPA Buyer shall be deemed to be an Adhering Party. In the event of any inconsistences between this Agreement and the ISDA U.S. Stay Protocol, the ISDA U.S. Stay Protocol will prevail.
(c) Reserved.
(d) Arbitration. Any dispute, claim or controversy arising out of or relating to this Agreement or the breach, termination, enforcement, interpretation or validity thereof, including the determination of the scope of this agreement to arbitrate, shall be determined by final, non-appealable binding arbitration in San Francisco, California before three (3) arbitrators. The arbitration shall be administered by Judicial Arbitration and Mediation Services, Inc. (“JAMS”) pursuant to its Comprehensive Arbitration Rules and Procedures. Within fifteen (15) days after the commencement of arbitration, each of PPA Seller and PPA Buyer shall select one person to act as arbitrator, and the two so-selected arbitrators shall select a third arbitrator (the “chairperson”) within thirty (30) days of the commencement of the arbitration. If either PPA Seller or PPA Buyer is unable or fails to select one person to act as arbitrator, such arbitrator shall be appointed by JAMS. If the PPA Seller and PPA Buyer-selected arbitrators are unable or fail to agree upon a chairperson, the chairperson shall be appointed by JAMS. The chairperson shall be a person who has experience in renewable energy-related transactions, and none of the arbitrators shall have been previously employed by any Party or have any direct pecuniary interest in any Party or the subject matter of the arbitration, unless such conflict is expressly acknowledged and waived in writing by all of the Parties. The Parties shall maintain the confidential nature of the arbitration proceeding and any award, including any hearing(s), except as may be necessary to prepare for or conduct the arbitration hearing on the merits, or except as necessary in connection with a court application for a preliminary remedy, a judicial challenge to an award or its enforcement, or unless otherwise required by law or judicial decision. Any arbitration proceedings, decision or award rendered hereunder and the validity, effect and interpretation of this arbitration provision shall be governed by the Federal Arbitration Act. The arbitrator(s) shall have no authority to award consequential, treble, exemplary, or punitive damages of any type or kind regardless of whether such damages may be available under any law or right, with the Parties hereby affirmatively waiving their rights, if any, to recover or claim such damages. In any arbitration arising out of or related to this Agreement, the arbitrators shall award to the prevailing Party or Parties, if any, the costs and attorney’s fees reasonably incurred in seeking to enforce the application of this Section 11(d) and by the prevailing party in connection with the arbitration.

Notwithstanding the foregoing provisions of this Section 11(d), any costs incurred by a Party in seeking judicial enforcement of any written decision of the arbitrators shall be chargeable to and borne exclusively by the Party against whom such court order is obtained. The award shall be final and binding on the Parties and judgment upon any award may be entered in any court of competent jurisdiction.
(e) Judicial Reference. Without limiting the provisions in Section 11(d), if Section 11(d) is deemed ineffective or unenforceable in any respect, any dispute between the Parties arising out of or in connection with this Agreement or its performance, breach, or termination (including the existence, validity and interpretation of this Agreement and the applicability of any statute of limitation period) (each, a “Dispute”) shall be resolved by a reference proceeding in California in accordance with the provisions of Sections 638 et seq. of the California Code of Civil Procedure (“CCP”), or their successor sections (a “Reference Proceeding”), which shall constitute the Attachment Staff Report Item 15D
13 exclusive remedy for the resolution of any Dispute. As a condition precedent to initiating a Reference Proceeding with respect to any Dispute, the Parties shall comply with the provisions of Section 11(e)(i).
i. Notice of Dispute. Prior to initiating the Reference Proceeding, a Party (the “Disputing Party”) shall provide the other Parties (the “Responding Parties”) with a written notice of each issue in dispute, a proposed means for resolving each such issue, and support for such position (the “Notice of Dispute”). Within 10 days after receiving the Notice of Dispute, the Responding Parties shall provide the Disputing Party with a written Notice of each additional issue (if any) with respect to the dispute raised by the Notice of Dispute, a proposed means for resolving every issue in dispute, and support for such position (the “Dispute Response”). Thereafter, the Parties shall meet to discuss the matter and attempt in good faith to reach a negotiated resolution of the dispute. If the Parties do not resolve the dispute by unanimous agreement within sixty 60 days after receipt of the Dispute Response, (the “Negotiation Period”), then any Party may provide to the other Parties written notice of intent for judicial reference (the “Impasse Notice”) in accordance with the further provisions of this Section 11.
ii. Applicability; Selection of Referees.
(A) Within 10 days of the delivery of an Impasse Notice, each of PPA Seller and PPA Buyer shall nominate one (1) referee. The two (2) referees (the “Party-Appointed Referees”) shall appoint a third referee (the “Third Referee”, together with the Party-Appointed Referees, the “Referees”). The Party-Appointed Referees shall be competent and experienced in matters involving the electric energy business in the United States, with at least ten (10) years of electric industry experience as a practicing attorney. The Third Referee shall be an active or retired California state or federal judge. Each of the Party-Appointed Referees and the Third Referee shall be impartial and independent of each of the Parties and of the other referees and not employed by any of the Parties in any prior matter. (B) If the Party-Appointed Referees are unable to agree on the Third Referee within 45 days from delivery of the Impasse Notice, then the Third Referee shall be appointed pursuant to CCP Section 640(b) in an action filed in the Superior Court of California, County of San Francisco (the “Court”), and with due regard given to the selection criteria above. A request for appointment of a referee may be heard on an ex parte or expedited basis, and the Parties agree that irreparable harm would result if ex parte relief is not granted. Pursuant to CCP Section 170.6, each of PPA Buyer and PPA Seller shall have one (1) peremptory challenge to the referee selected by the Court.
iii. Discovery; Proceedings.
(A) The Parties agree that time is of the essence in conducting the Reference Proceeding. Accordingly, the referees shall be requested, subject to change in the time periods specified herein for good cause shown, to (i) set the matter for a status and trial-setting conference within 20 days after the date of Attachment Staff Report Item 15D
14 selection of the Third Referee, (ii) if practicable, try all issues of law or fact within 180 days after the date of the conference, and (iii) report a statement of decision within 20 days after the matter has been submitted for decision. (B) Discovery and other pre-hearing procedures shall be conducted as agreed to by the Parties, or if they cannot agree, as determined by the Third Referee after discussion with the Parties regarding the need for discovery and other pre-hearing procedures. (C) Except as expressly set forth herein, the Third Referee shall determine the manner in which the Reference Proceeding is conducted, including the time and place of hearings, the order of presentation of evidence, and all other questions that arise with respect to the course of the Reference Proceeding. The Reference Proceeding, including the trial, shall be conducted at a neutral location selected by the Parties, or if not agreed by the Parties, by the Third Referee, in San Francisco, California.
(D) All proceedings and hearings conducted before the referees, except for trial, shall be conducted without a court reporter, except that when any Party so requests, a court reporter will be used at any hearing conducted before the referees, and the referees will be provided a courtesy copy of the transcript. The Party making such a request shall have the obligation to arrange for and pay the court reporter.
iv. Decision. The referees shall render a written statement of decision setting forth findings of fact and conclusions of law. The decision shall be entered as a judgment in the court in accordance with the provisions of CCP Sections 644 and 645. The decision shall be appealable to the same extent and in the same manner that such decision would be appealable if rendered by a judge of the Court. The Parties intend this general reference agreement to be specifically enforceable in accordance with the CCP. v. Expenses. Each of PPA Seller and PPA Buyer shall bear the compensation and expenses of its respective Party-Appointed Referee, own counsel, witnesses, consultants and employees. All other expenses of judicial reference shall be split equally between PPA Seller and PPA Buyer.
(f) Limitation of Liability. Notwithstanding anything to the contrary herein, all obligations of Issuer under this Agreement, including without limitation all obligations to make payments of any kind whatsoever, are special, limited obligations of Issuer, payable solely from the Trust Estate (as such term is defined in the Bond Indenture) as and to the extent provided in the Bond Indenture, including with respect to Operating Expenses (as such term is defined in the Bond Indenture). Issuer shall not be required to advance any moneys derived from any source other than the Revenues (as such term is defined in the Bond Indenture) and other assets pledged under the Bond Indenture for any of the purposes in this Agreement mentioned. Neither the faith and credit of Issuer nor the taxing power of the State of California or any political subdivision Attachment Staff Report Item 15D
15 thereof is pledged to payments pursuant to this Agreement. Issuer shall not be directly, indirectly, contingently or otherwise liable for any costs, expenses, losses, damages, claims or actions, of any conceivable kind on any conceivable theory, under or by reasons of or in connection with this Agreement, except solely to the extent Revenues (as such term is defined in the Bond Indenture) are received for the payment thereof and may be applied therefor pursuant to the terms of the Bond Indenture
Attachment Staff Report Item 15D
Signature Page to Limited Assignment Agreement
IN WITNESS WHEREOF, the Parties have executed this Agreement effective as of the date first set forth above.

MORGAN STANLEY CAPITAL GROUP INC.

By: ____________________________
Name:_______________________
Title:________________________

EAST BAY COMMUNITY ENERGY AUTHORITY
By: ____________________________
Name:_______________________
Title:________________________
MORGAN STANLEY ENERGY STRUCTURING, L.L.C.

By: ____________________________
Name:_______________________
Title:________________________

CALIFORNIA COMMUNITY CHOICE FINANCING AUTHORITY
By: ____________________________
Name:_______________________
Title:________________________
Attachment Staff Report Item 15D
Appendix 1 - 1
Appendix 1
Assigned Rights and Obligations
PPA: Master Power Purchase and Sale Agreement dated as of [____] and the Confirmation thereunder dated as of [____], by and between PPA Buyer and PPA Seller Assigned Delivery Point: [NP15 EZ GEN HUB)]
Assigned Product Price: [To list applicable Energy Price or Flat Price specified in the PPA] Further Information: [Include additional requirements, if any] Attachment Staff Report Item 15D
Appendix 2 - 1
Appendix 2
Notice Information
[To be completed before signing.]
Attachment Staff Report Item 15D
Appendix 3 - 1
Appendix 3
Copy of Power Sales Contract
[To be attached.]
Attachment Staff Report Item 15D
HB Draft 7 April 2022

LIMITED ASSIGNMENT AGREEMENT
This Limited Assignment Agreement (this “Agreement”) is entered into as of [____], 2022 by and among Morgan Stanley Capital Group Inc., a Delaware corporation (“PPA Seller”), East Bay Community Energy Authority, a joint powers authority and a community choice aggregator organized under the laws of the State of California (“PPA Buyer”), California Community Choice Financing Authority, a joint powers authority and a public entity of the State of California established pursuant to the provisions of the Joint Exercise of Powers Act (Article 1, Chapter 5, Division 7, Title 1, Section 6500 et seq. of the California Government Code, as amended) (“Issuer”), and Morgan Stanley Energy Structuring, L.L.C., a Delaware limited liability company (“MSES”).

RECITALS
WHEREAS, PPA Buyer and PPA Seller are parties to that certain Master Power Purchase and Sale Agreement dated [____], 20[__] and the Specified Source Product Confirmation thereunder dated as of the date hereof (the “PPA”);
WHEREAS, in connection with a prepaid electricity transaction between Issuer and MSES, and with effect from and including the Assignment Period Start Date (as defined below), PPA Buyer wishes to transfer by limited assignment to MSES, and MSES wishes to accept the transfer by limited assignment of, the Assigned Rights and Obligations (as defined below) for the duration of the Assignment Period (as defined below); and
WHEREAS, pursuant to this Agreement, MSES will receive the Assigned Product and MSES will deliver the Assigned Product to MSES, which will redeliver the Assigned Product to Issuer for ultimate redelivery to PPA Buyer; and
WHEREAS, pursuant to this Agreement, MSES will assume responsibility for the Delivered Product Payment Obligation.

AGREEMENT

1. Definitions.

Attachment Staff Report Item 15E
2 “Assigned Energy” means any Electricity associated with the Assigned Product to be delivered to MSES hereunder pursuant to the Assigned Rights and Obligations. “Assigned Quantity” means all Assigned Product delivered in accordance with the PPA by PPA Seller in each year during the Assignment Period. “Assigned Product” includes all Specified Source Energy and Carbon Free Energy (as such terms are defined in the PPA) associated with the Assigned Quantity. “Assigned Product Price” means the Energy Price (as defined in the PPA and specified in Appendix 1).
“Assigned Rights and Obligations” means (i) the rights of PPA Buyer under the PPA to receive the Assigned Quantity of Assigned Product during the Assignment Period, as such rights may be limited or further described in the “Further Information” section on Appendix 1, and (ii) the Delivered Product Payment Obligation, which right and obligation are transferred and conveyed to MSES hereunder.
“Assignment Early Termination Date” has the meaning specified in Section 5(b). “Assignment Period” has the meaning specified in Section 5(a). “Assignment Period End Date” means 11:59:59 p.m. pacific prevailing time on [____], 20[__].
“Assignment Period Start Date” means means 00:00 pacific prevailing time on [____], 2022.
“Business Day” means any day except a Saturday, Sunday, or a Federal Reserve Bank holiday. A Business Day begins at 8:00 a.m. and ends at 5:00 p.m. local time for the Party sending a notice, or payment, or performing a specified action. “CAISO Tariff” means the California Independent System Operator Corporation Agreement and Tariff, Business Practice Manuals (BPMs), and Operating Procedures, including the rules, protocols, procedures and standards attached thereto, as the same may be amended or modified from time-to-time and approved by the Federal Energy Regulatory Commission. “Claims” means all claims or actions, threatened or filed, and the resulting losses, damages, expenses, attorneys’ fees, experts’ fees, and court costs, whether incurred by settlement or otherwise, and whether such claims or actions are threatened or filed prior to or after the termination of this Agreement, in each case arising under, in respect of or related in any way to the PPA or any transaction thereunder, except for the Delivered Product Payment Obligation. “Delivered Product Payment Obligation” has the meaning specified in Section 3(a).

Attachment Staff Report Item 15E
3 “Electricity” means three-phase, 60-cycle alternating current electric energy, expressed in megawatt hours (MWh).
“Government Agency” means the United States of America, any state thereof, any municipality, or any local jurisdiction, or any political subdivision of any of the foregoing, including, but not limited to, courts, administrative bodies, departments, commissions, boards, bureaus, agencies, or instrumentalities.
“Issuer” has the meaning specified in the first paragraph of this Agreement. “Inter-SC Trade” or “IST” has the meaning set forth in the CAISO Tariff. “Month” means a calendar month.
“MSES” has the meaning specified in the first paragraph of this Agreement. “Person” means any individual, corporation, partnership, joint venture, trust, unincorporated organization, or Government Agency.
“PPA Buyer” has the meaning specified in the first paragraph of this Agreement. “PPA Seller” has the meaning specified in the first paragraph of this Agreement. “Prepaid Agreement” means that certain Prepaid Energy Sales Agreement dated as of the date hereof by and between MSES and Issuer.
“Prepay Power Supply Contract” means that certain Prepay Power Supply Contract dated as of the date hereof by and between PPA Buyer and Issuer. “Receivables” has the meaning given to such term in Section 3(e). “Retained Rights and Obligations” has the meaning specified in Section 3. “Scheduling Coordinator” or “SC” means an entity certified by the CAISO as qualifying as a Scheduling Coordinator pursuant to the CAISO Tariff for the purposes of undertaking the functions specified in “Responsibilities of a Scheduling Coordinator,” of the CAISO Tariff, as amended from time to time.

2. Transfer and Undertakings.
(a) PPA Buyer hereby assigns, transfers and conveys to MSES all right, title and interest in and to the rights of PPA Buyer under the PPA to receive delivery of the Assigned Product during the Assignment Period. In connection with this assignment, PPA Buyer hereby delegates to MSES the Assigned Rights and Obligations during the Assignment Period. (b) PPA Seller hereby consents and agrees to PPA Buyer’s assignment, transfer and conveyance of all right, title and interest in and to the Assigned Product and Assigned Rights and Attachment Staff Report Item 15E
4 Obligations to MSES and the exercise and performance by MSES of the Assigned Rights and Obligations during the Assignment Period.
(c) MSES hereby accepts such assignment, transfer and conveyance of the Assigned Rights and Obligations during the Assignment Period and agrees to perform any such Assigned Rights and Obligations due from it during the Assignment Period to the extent expressly set forth in this Agreement.

3. Limited Assignment.

The Parties acknowledge and agree that (i) the Assigned Rights and Obligations include only a portion of PPA Buyer’s rights and obligations under the PPA, and that all rights and obligations arising under the PPA that are not expressly included in the Assigned Rights and Obligations shall be “Retained Rights and Obligations”, and (ii) the Retained Rights and Obligations include all rights and obligations of PPA Buyer arising during the Assignment Period except the rights and obligations expressly included in the Assigned Rights and Obligations. In this regard:
(a) Limited to Delivered Product Payment Obligation; Invoicing. i. MSES’s sole obligation to PPA Seller will be to pay the Assigned Product Price to PPA Seller for the Assigned Product delivered during each Month of the Assignment Period on each applicable payment date under Section 5.2 of the Confirmation to the PPA for a quantity determined under this Section 3(a)i (the “Delivered Product Payment Obligation”). PPA Buyer shall remain solely responsible for any payment obligations other than the Delivered Product Payment Obligation due under the PPA during the Assignment Period (the “Retained Payment Obligation”). For purposes of determining the Delivered Product Payment Obligation and other related payment obligations during the Assignment Period, each Party acknowledges and agrees as follows:
(A) the PPA provides for the delivery of the Assigned Quantity on an annual basis, but, notwithstanding the foregoing, the Assigned Quantity shall be settled on a monthly basis by multiplying the [Hourly Quantity (as defined in the PPA)] the number CAISO Energy Delivery Hours (as defined in the PPA) in each month (the “Settlement Monthly Quantity”), for purposes of determining amounts due under this Agreement, the Prepay Power Supply Contract and the Prepaid Agreement for each month of the Assignment Period (as futher described below); (B) regardless of the Assigned Quantity actually delivered in any month during the Assignment Period, (I) the Delivered Product Payment Obligation shall be an amount equal to the result of (x) the Settlement Monthly Quantity, multiplied by (y) the Assigned Product Price; and (II) the payment due from PPA Buyer to Issuer under the Prepay Power Supply Contract shall be an amount equal to the result of (x) the Settlement Monthly Quantity, multiplied by (y) the Contract Price (as defined in the Prepay Power Supply Contract); and
(C) to the extent that (I) an amount less than the Annual Quantity (as defined in the PPA) has been delivered as of the end of December for any year Attachment Staff Report Item 15E
5 during the Assignment Period or (II) an Assignment Early Termination Date occurs and the Assigned Quantity actually delivered prior to such date is less than the Settlement Monthly Quantity through such date (any such shortfall amount under clauses (I) or (II), an “Assigned Shortfall Quantity”), then PPA Buyer will be deemed to have remarketed the Assigned Shortfall Quantity in a Private Business Sale (as defined in Exhibit C to the Prepaid Agreement), and MSES will record any such Assigned Shortfall Quantity as a Ledger Entry on the Private Business Sales Ledger (as each such term is defined in Exhibit C to the Prepaid Agreement effective as of the first day of the month of December or the month in which an Assignment Early Termination Date occurs, as applicable; provided in addition that, notwithstanding anything to the contrary in the Prepaid Agreement, MSES shall have no remarketing payment obligations with respect to any such Assigned Shortfall Quantity.
ii. PPA Seller shall deliver each monthly invoice and related supporting data during the Assignment Period to each of PPA Buyer and MSES, and each such invoice shall indicate (A) the total amount due to PPA Seller under the PPA for such Month (the “Monthly Gross Amount”); (B) the Delivered Product Payment Obligation; and (C) the Retained Payment Obligation, which (I) shall be determined by subtracting the Delivered Product Payment Obligation from the Monthly Gross Amount and (II) shall reflect an amount due from PPA Buyer to the extent it is a positive number and an amount due to PPA Buyer to the extent it is a negative number; provided in addition that any payment adjustments or subsequent reconciliations occurring after the date that is 10 days prior to the payment due date for a monthly invoice will be resolved solely between PPA Buyer and PPA Seller. The Delivered Product Payment Obligation and Retained Payment Obligation shall be administered by a custodian who will pay (1) the Monthly Gross Amount to PPA Seller on each payment due date and (2) the absolute value of the Retained Payment Obligation to PPA Buyer to the extent such amount is negative for any given Month.
(b) Retained Rights and Obligations. Any Claims (other than the Delivered Product Payment Obligation or a failure to perform the same) arising or existing in connection with or related to the PPA, whether related to performance by PPA Seller, PPA Buyer or MSES, and whether arising before, during or after the Assignment Period, in each case excluding the Delivered Product Payment Obligation, will be included in the Retained Rights and Obligations and any such Claims will be resolved exclusively between PPA Seller and PPA Buyer in accordance with the PPA.
(c) Scheduling. All scheduling of Electricity associated with Assigned Product and other communications related to the PPA shall take place between PPA Buyer and PPA Seller pursuant to the terms of the PPA; provided that (i) title to Assigned Product will pass to MSES upon delivery by PPA Seller at the Assigned Delivery Point in accordance with the PPA; (ii) immediately thereafter, title to such Assigned Product will pass to MSES, Issuer and then to PPA Buyer upon delivery by MSES at the same point where title is passed to MSES pursuant to clause (i) above; (iii) PPA Buyer will be deemed to be acting as MSES’s agent with regard to scheduling Assigned Energy; provided, however, that PPA Buyer shall be entitled to retain for its own account all CAISO revenues associated with delivery of the Assigned Product to CAISO, including where Attachment Staff Report Item 15E
6 PPA Buyer is acting as Scheduling Coordinator for the Facility (as defined in the PPA) and through scheduling of ISTs; and (iv) (A) PPA Buyer and PPA Seller will provide copies to MSES of (I) any notice of force majeure delivered under the PPA and (II) any notice of a default or of a breach or other event that, if not cured within an applicable grace period, could result in a default; (B) PPA Seller will provide copies to MSES of annual forecasts and monthly forecasts and generation reports delivered under the PPA; and (C) PPA Buyer and PPA Seller, as applicable, will provide copies to MSES of any other information reasonably requested by MSES relating to Assigned Product.
(d) Amendments. PPA Buyer and PPA Seller will provide written notice (including copies thereof) of any amendment, waiver, supplement, modification, or other changes to the PPA to MSES relating to the Assigned Rights and Obligations, and the Parties hereby acknowledge and agree that an amendment, waiver, supplement, modification or other change will not have any effect on MSES’s rights or obligations under this Agreement until and unless MSES receives written notice thereof.
(e) Setoff of Receivables. Pursuant to the Prepaid Agreement, MSES has agreed to purchase the rights to payment of the net amounts owed by PPA Buyer under the Prepay Power Supply Contract (“Receivables”) in the case of non-payment by PPA Buyer. To the extent any such Receivables relate to Assigned Product purchased by MSES pursuant to the Assigned Rights and Obligations, MSES may transfer such Receivables (excluding any penalties, late payment fees, late payment interest or other fees, costs or interest included in such Receivables) to PPA Seller and apply the face amount of such Receivables (excluding any penalties, late payment fees, late payment interest or other fees, costs or interest included in such Receivables) as a reduction to any Delivered Product Payment Obligations; provided, however, that at no time shall PPA Seller be required to pay MSES for any amounts by which such Receivables exceed any Delivered Product Payment Obligations then due and owed to PPA Seller.
(f) Joinder to Intercreditor Agreement. In connection with the execution of this Agreement and as a condition precedent to the effectiveness hereof, Issuer shall execute a joinder to that certain Intercreditor and Collateral Agency Agreement, dated as of [____], 20[__], by and among River City Bank, as Collateral Agent, the PPA Providers from time to time party thereto and [Silicon Valley Clean Energy Authority] (the “Intercreditor and Collateral Agency Agreement”), which will provide Issuer with certain rights as a PPA Provider and Secured Creditor under the Intercreditor and Collateral Agency Agreement, the Security Agreement (as defined in the Intercreditor and Collateral Agency Agreement), and the Control Agreement (as defined in the Intercreditor and Collateral Agency Agreement) (collectively, the “Security Documents”) for the portion of the payments under the Prepay Power Supply Contract with respect to the Assigned Quantity. The Prepay Power Supply Contract shall have the same meaning as “Power Purchase Agreement” under the Intercreditor and Collateral Agency Agreement. PPA Buyer agrees that it shall make payments with respect to the Assigned Quantity to Issuer under the Prepay Power Supply Contract on the 20th or preceding business day of the month following deliveries consistent with the terms thereof, and such payments will not be made through the Lockbox Account (as defined in the Security Agreement) but will be made from PPA Buyer’s available funds not pledged as Collateral (as defined in the Security Agreement); provided that, in the event PPA Buyer fails to make any such payment when due under Prepay Power Supply Contract with respect to the Assigned Quantity, upon written request of Issuer, PPA Buyer shall Attachment Staff Report Item 15E
7 cause such payment due to Issuer to be included as Regular Charges (as defined in the Security Agreement) on the first Distribution Date Certificate (as defined in the Security Agreement) to be issued at least ten (10) or more Business Days thereafter. If PPA Buyer fails to do so, Issuer may dispute such Distribution Date Certificate and otherwise pursue its rights to payment thereon pursuant to the terms of the Intercreditor and Collateral Agency Agreement. To the extent Issuer receives any amounts under the Security Documents or Intercreditor and Collateral Agency Agreement in respect of any Receivables purchased by MSES, Issuer shall (i) hold such amounts in trust for the benefit of MSES, (ii) promptly notify MSES thereof and (iii) promptly remit such amounts directly to an account specified by MSES. Issuer’s rights as a Secured Creditor and PPA Provider under the Security Documents (x) are limited to amounts owed in connection with the Assigned Quantity, (y) shall terminate automatically following the end of the Assignment Period, subject to payment of any amounts then owing to Issuer pursuant to the Prepay Power Supply Contract in connection with the Assigned Quantity, and (z) upon written request from PPA Buyer, provided that PPA Buyer has no further obligations to Issuer, under the Prepay Power Supply Contract, Issuer shall provide a written termination statement as described under Section 7.12(d) of the Security Agreement consenting to termination of Issuer’s rights as a Secured Creditor under the Security Documents, including with respect to the Collateral, and Issuer agrees that such written termination statement shall not be unreasonably withheld, delayed or conditioned.

4. Forward Contract.

5. Assignment Period; Assignment Early Termination.
(a) Assignment Period. The “Assignment Period” shall begin on the Assignment Period Start Date and extend until the Assignment Period End Date; provided that in no event shall the Assignment Period extend past an Assignment Early Termination Date. (b) Early Termination. An “Assignment Early Termination Date” will occur under the following circumstances and as of the dates specified below:
i. the assignment of the Prepay Power Supply Contract by PPA Buyer or Issuer pursuant to Article XIII thereof, which Assignment Early Termination Date shall occur immediately as of the time of such assignment;
ii. the suspension, expiration, or termination of performance of the PPA by either PPA Buyer or PPA Seller for any reason other than the occurrence of Force Majeure under and as defined in the PPA, which Assignment Early Termination Date shall occur immediately as of the time of PPA Seller’s last performance under the PPA following such suspension, expiration, or termination;
iii. the election of MSES in its sole discretion to declare an Assignment Early Termination Date as a result of (a) any event or circumstance that would give either PPA Buyer or PPA Seller the right to terminate or suspend performance under the PPA (regardless of whether PPA Buyer or PPA Seller exercises such right) or (b) the execution Attachment Staff Report Item 15E
8 of an amendment, waiver, supplement, modification or other change to the PPA that adversely affects the Assigned Rights and Obligations or MSES’s rights or obligations under this Agreement (provided that MSES shall not have a right to terminate under this clause (b) to the extent that MSES (i) receives prior notice of such change and (ii) provides its written consent thereto), which Assignment Early Termination Date shall occur upon the date set forth in a written notice of such election delivered by MSES to PPA Buyer and PPA Seller;
iv. termination or suspension of deliveries for any reason other than force majeure under the Prepaid Agreement or Prepay Power Supply Contract, which Assignment Early Termination Date shall occur immediately as of the time of the last deliveries under the relevant contract following such suspension or termination; v. the election of PPA Seller or PPA Buyer in its sole discretion to declare an Assignment Early Termination Date if MSES fails to pay when due any amounts owed to PPA Seller in respect of any Delivered Product Payment Obligation and such failure continues for five Business Days following receipt by MSES of written notice thereof, which Assignment Early Termination Date shall occur upon the date set forth in a written notice of such election delivered by PPA Seller or PPA Buyer, as applicable, to MSES, and with a copy to PPA Buyer or PPA Seller, as applicable;
vi. the election of PPA Seller or PPA Buyer in its sole discretion to declare an Assignment Early Termination Date if either (a) an involuntary case or other proceeding is commenced against MSES seeking liquidation, reorganization or other relief with respect to it or its debts under any applicable Federal or State bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or similar law now or hereafter in effect or seeking the appointment of a custodian, receiver, liquidator, assignee, trustee, sequestrator or similar official of it or any substantial part of its property, and such involuntary case or other proceeding shall remain undismissed and unstayed, or an order or decree approving or ordering any of the foregoing is entered and continued unstayed and in effect, in any such event, for a period of 60 days, or (b) MSES commences a voluntary case or proceeding under any applicable Federal or State bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or other similar law or any other case or proceeding to be adjudicated as bankrupt or insolvent, or MSES consents to the entry of a decree or order for relief in an involuntary case or proceeding under any applicable Federal or State bankruptcy, insolvency, reorganization or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, files a petition or answer or consent seeking reorganization or relief under any applicable Federal or State law, or consents to the filing of such petition or to the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or similar official of MSES or any substantial part of its property, or makes an assignment for the benefit of creditors, or admits in writing its inability to pay its debts generally as they become due, which Assignment Early Termination Date shall occur upon the earliest date set forth in a written notice of such election delivered by PPA Seller or PPA Buyer, as applicable, to MSES, and with a copy to PPA Buyer or PPA Seller, as applicable;
Attachment Staff Report Item 15E
9 vii. either MSES or PPA Buyer may designate an Assignment Early Termination Date with written notice to the other Parties to the extent that MSES and PPA Buyer have mutually agreed upon a replacement Assignment Agreement (as defined in the Prepay Power Supply Contract) that will replace the Assigned Rights and Obligations hereunder immediately following the termination hereof, which Assignment Early Termination Date shall occur effective as of the end of the Month preceding the commencement of the “Assignment Period” under the replacement Assignment Agreement as specified in the notice from MSES or PPA Buyer to the other Parties; and viii. PPA Buyer may deliver written notice of termination to the other Parties if any change, event or effect occurs, including but not limited a change in applicable laws or regulations, any issues with the PPA Seller or the PPA, a dispute under the PPA or other similar circumstance, that individually or collectively have or are reasonably expected by PPA Buyer to have a material adverse effect upon (A) the PPA Buyer, (B) its rights and obligations under this Agreement, the Prepay Power Supply Contract, or the PPA, or (C) the benefit the PPA Buyer is receiving by assigning the Assigned Rights and Obligations, with such Assignment Early Termination Date to be the date set forth in a written notice delivered by PPA Buyer to the other Parties; provided that (x) PPA Buyer will provide notice to the other Parties as soon as is reasonably possible that PPA Buyer anticipates exercising this termination right, and (y) PPA Buyer shall exercise commercially reasonable efforts to propose and agree with MSES upon a replacement Assignment Agreement prior to exercising this termination right.
(c) Reversion of Assigned Rights and Obligations. The parties acknowledge and agree that upon the occurrence of an Assignment Early Termination Date the Assigned Rights and Obligations will revert from MSES to PPA Buyer. Any Assigned Rights and Obligations that would become due for payment or performance on or after such Assignment Early Termination Date shall immediately and automatically revert from MSES to PPA Buyer, provided that (i) MSES shall remain responsible for the Delivered Product Payment Obligation with respect to any Assigned Product delivered to MSES prior to the Assignment Early Termination Date, and (ii) any legal restrictions on the effectiveness of such reversion (whether arising under bankruptcy law or otherwise) shall not affect the occurrence of the Assignment Early Termination Date.

Attachment Staff Report Item 15E
10 i. it has made no prior transfer (whether by way of security or otherwise) of any interest in the Assigned Rights and Obligations; and ii. all obligations of PPA Buyer and PPA Seller under the PPA required to be performed on or before the Assignment Period Start Date have been fulfilled. (d) Representations. Each Party represents to each of the other Parties:
i. Status. It is duly organized and validly existing under the laws of the jurisdiction of its organization or incorporation and, if relevant under such laws, in good standing.
ii. Powers. It has the power to execute this Agreement and any other documentation relating to this Agreement to which it is a party, to deliver this Agreement and any other documentation relating to this Agreement that it is required by this Agreement to deliver and to perform its obligations under this Agreement and has taken all necessary action to authorize such execution, delivery and performance. iii. No Violation or Conflict. Such execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby, including the incurrence by such Party of its obligations under this Agreement, will not result in any violation of, or conflict with: (i) any term of any material contract or agreement applicable to it; (ii) any of its charter, bylaws, or other constitutional documents; (iii) any determination or award of any arbitrator applicable to it; or (iv) any license, permit, franchise, judgment, writ, injunction or regulation, decree, order, charter, law, ordinance, rule or regulation of any Government Agency, applicable to it or any of its assets or properties or to any obligations incurred by it or by which it or any of its assets or properties or obligations are bound or affected, and shall not cause a breach of, or default under, any such term or result in the creation of any lien upon any of its properties or assets. iv. Consents. All consents, approvals, orders or authorizations of, registrations, declarations, filings or giving of notice to, obtaining of any licenses or permits from, or taking of any other action with respect to, any Person or Government Agency that are required to have been obtained by such Party with respect to this Agreement and the transactions contemplated hereby, including the due authorization of such Party and its governing body and any approval or consent of any security holder of such Party or any holder (or any trustee for any holder) of any indebtedness or other obligation of such Party, have been obtained and are in full force and effect and all conditions of any such consents have been complied with. v. Obligations Binding. Its obligations under this Agreement constitute its legal, valid and binding obligations, enforceable in accordance with their respective terms (subject to applicable bankruptcy, reorganization, insolvency, moratorium or similar laws affecting creditors’ rights generally and subject, as to enforceability, to equitable principles of general application (regardless of whether enforcement is sought in a proceeding in equity or at law)).

Attachment Staff Report Item 15E
11 vi. Non-Reliance. It is acting for its own account, and it has made its own independent decisions to enter into this Agreement and as to whether this Agreement is appropriate or proper for it based upon its own judgment and upon advice from such advisers as it has deemed necessary. It is not relying on any communication (written or oral) of the other Parties as investment advice or as a recommendation to enter into this Agreement; it being understood that information and explanations related to the terms and conditions of this Agreement shall not be considered investment advice or a recommendation to enter into this Agreement. It is entering into this Agreement as a bona-fide, arm’s-length transaction involving the mutual exchange of consideration and, once executed by all Parties, considers this Agreement a legally enforceable contract. No communication (written or oral) received from any of the other Parties shall be deemed to be an assurance or guarantee as to the expected results of this Agreement. vii. Assessment and Understanding. It is capable of assessing the merits of and understanding (on its own behalf or through independent professional advice), and understands and accepts, the terms, conditions and risks of this Agreement. It is also capable of assuming, and assumes, the risks of this Agreement. viii. Status of Parties. None of the other Parties is acting as a fiduciary for or an adviser to it in respect of this Agreement.

7. Counterparts.

8. Costs and Expenses.

9. Amendments.

10. Notices.

Any notice, demand, statement or request required or authorized by this Agreement to be given by one Party to another shall be in writing, except as otherwise expressly provided herein. It shall be sent by email transmission, courier, or personal delivery (including overnight delivery service) to each of the notice recipients and addresses for each of the other Parties designated in Appendix 2 hereto. Any such notice, demand, or request shall be deemed to be given (i) when sent by email transmission, or (ii) when actually received if delivered by courier or personal delivery (including Attachment Staff Report Item 15E
12 overnight delivery service). Each Party shall have the right, upon 10 days’ prior written notice to the other Parties, to change its address at any time, and to designate that copies of all such notices be directed to another person at another address. The Parties may mutually agree in writing at any time to deliver notices, demands or requests through alternate or additional methods.

11. Miscellaneous.
(a) Governing Law. This Agreement and the rights and duties of the Parties under this Agreement will be governed by and construed, enforced and performed in accordance with the laws of the state of New York, without reference to any conflicts of laws provisions that would direct the application of another jurisdiction’s laws; provided, however, that the authority of PPA Buyer to enter into and perform its obligations under this agreement shall be determined in accordance with the laws of the state of California.
(b) U.S. Resolution Stay. The Parties hereby confirm that they are adherents to the ISDA 2018 U.S. Resolution Stay Protocol (“ISDA U.S. Stay Protocol”), the terms of the ISDA U.S. Stay Protocol are incorporated into and form a part of this Agreement, and this Agreement shall be deemed a Protocol Covered Agreement for purposes thereof. For purposes of incorporating the ISDA U.S. Stay Protocol, MSES and PPA Seller shall each be deemed to be a Regulated Entity, and PPA Buyer shall be deemed to be an Adhering Party. In the event of any inconsistences between this Agreement and the ISDA U.S. Stay Protocol, the ISDA U.S. Stay Protocol will prevail.
(c) Reserved.
(d) Arbitration. Any dispute, claim or controversy arising out of or relating to this Agreement or the breach, termination, enforcement, interpretation or validity thereof, including the determination of the scope of this agreement to arbitrate, shall be determined by final, non-appealable binding arbitration in San Francisco, California before three (3) arbitrators. The arbitration shall be administered by Judicial Arbitration and Mediation Services, Inc. (“JAMS”) pursuant to its Comprehensive Arbitration Rules and Procedures. Within fifteen (15) days after the commencement of arbitration, each of PPA Seller and PPA Buyer shall select one person to act as arbitrator, and the two so-selected arbitrators shall select a third arbitrator (the “chairperson”) within thirty (30) days of the commencement of the arbitration. If either PPA Seller or PPA Buyer is unable or fails to select one person to act as arbitrator, such arbitrator shall be appointed by JAMS. If the PPA Seller and PPA Buyer-selected arbitrators are unable or fail to agree upon a chairperson, the chairperson shall be appointed by JAMS. The chairperson shall be a person who has experience in renewable energy-related transactions, and none of the arbitrators shall have been previously employed by any Party or have any direct pecuniary interest in any Party or the subject matter of the arbitration, unless such conflict is expressly acknowledged and waived in writing by all of the Parties. The Parties shall maintain the confidential nature of the arbitration proceeding and any award, including any hearing(s), except as may be necessary to prepare for or conduct the arbitration hearing on the merits, or except as necessary in connection Attachment Staff Report Item 15E
13 with a court application for a preliminary remedy, a judicial challenge to an award or its enforcement, or unless otherwise required by law or judicial decision. Any arbitration proceedings, decision or award rendered hereunder and the validity, effect and interpretation of this arbitration provision shall be governed by the Federal Arbitration Act. The arbitrator(s) shall have no authority to award consequential, treble, exemplary, or punitive damages of any type or kind regardless of whether such damages may be available under any law or right, with the Parties hereby affirmatively waiving their rights, if any, to recover or claim such damages. In any arbitration arising out of or related to this Agreement, the arbitrators shall award to the prevailing Party or Parties, if any, the costs and attorney’s fees reasonably incurred in seeking to enforce the application of this Section 11(d) and by the prevailing party in connection with the arbitration.

Notwithstanding the foregoing provisions of this Section 11(d), any costs incurred by a Party in seeking judicial enforcement of any written decision of the arbitrators shall be chargeable to and borne exclusively by the Party against whom such court order is obtained. The award shall be final and binding on the Parties and judgment upon any award may be entered in any court of competent jurisdiction.
(e) Judicial Reference. Without limiting the provisions in Section 11(d), if Section 11(d) is deemed ineffective or unenforceable in any respect, any dispute between the Parties arising out of or in connection with this Agreement or its performance, breach, or termination (including the existence, validity and interpretation of this Agreement and the applicability of any statute of limitation period) (each, a “Dispute”) shall be resolved by a reference proceeding in California in accordance with the provisions of Sections 638 et seq. of the California Code of Civil Procedure (“CCP”), or their successor sections (a “Reference Proceeding”), which shall constitute the exclusive remedy for the resolution of any Dispute. As a condition precedent to initiating a Reference Proceeding with respect to any Dispute, the Parties shall comply with the provisions of Section 11(e)(i).
i. Notice of Dispute. Prior to initiating the Reference Proceeding, a Party (the “Disputing Party”) shall provide the other Parties (the “Responding Parties”) with a written notice of each issue in dispute, a proposed means for resolving each such issue, and support for such position (the “Notice of Dispute”). Within 10 days after receiving the Notice of Dispute, the Responding Parties shall provide the Disputing Party with a written Notice of each additional issue (if any) with respect to the dispute raised by the Notice of Dispute, a proposed means for resolving every issue in dispute, and support for such position (the “Dispute Response”). Thereafter, the Parties shall meet to discuss the matter and attempt in good faith to reach a negotiated resolution of the dispute. If the Parties do not resolve the dispute by unanimous agreement within sixty 60 days after receipt of the Dispute Response, (the “Negotiation Period”), then any Party may provide to the other Parties written notice of intent for judicial reference (the “Impasse Notice”) in accordance with the further provisions of this Section 11.
ii. Applicability; Selection of Referees.
(A) Within 10 days of the delivery of an Impasse Notice, each of PPA Seller and PPA Buyer shall nominate one (1) referee. The two (2) referees (the “Party-Appointed Referees”) shall appoint a third referee (the “Third Referee”, together with the Party-Appointed Referees, the “Referees”). The Party-Appointed Attachment Staff Report Item 15E
14 Referees shall be competent and experienced in matters involving the electric energy business in the United States, with at least ten (10) years of electric industry experience as a practicing attorney. The Third Referee shall be an active or retired California state or federal judge. Each of the Party-Appointed Referees and the Third Referee shall be impartial and independent of each of the Parties and of the other referees and not employed by any of the Parties in any prior matter. (B) If the Party-Appointed Referees are unable to agree on the Third Referee within 45 days from delivery of the Impasse Notice, then the Third Referee shall be appointed pursuant to CCP Section 640(b) in an action filed in the Superior Court of California, County of San Francisco (the “Court”), and with due regard given to the selection criteria above. A request for appointment of a referee may be heard on an ex parte or expedited basis, and the Parties agree that irreparable harm would result if ex parte relief is not granted. Pursuant to CCP Section 170.6, each of PPA Buyer and PPA Seller shall have one (1) peremptory challenge to the referee selected by the Court.
iii. Discovery; Proceedings.
(A) The Parties agree that time is of the essence in conducting the Reference Proceeding. Accordingly, the referees shall be requested, subject to change in the time periods specified herein for good cause shown, to (i) set the matter for a status and trial-setting conference within 20 days after the date of selection of the Third Referee, (ii) if practicable, try all issues of law or fact within 180 days after the date of the conference, and (iii) report a statement of decision within 20 days after the matter has been submitted for decision. (B) Discovery and other pre-hearing procedures shall be conducted as agreed to by the Parties, or if they cannot agree, as determined by the Third Referee after discussion with the Parties regarding the need for discovery and other pre-hearing procedures. (C) Except as expressly set forth herein, the Third Referee shall determine the manner in which the Reference Proceeding is conducted, including the time and place of hearings, the order of presentation of evidence, and all other questions that arise with respect to the course of the Reference Proceeding. The Reference Proceeding, including the trial, shall be conducted at a neutral location selected by the Parties, or if not agreed by the Parties, by the Third Referee, in San Francisco, California.
(D) All proceedings and hearings conducted before the referees, except for trial, shall be conducted without a court reporter, except that when any Party so requests, a court reporter will be used at any hearing conducted before the referees, and the referees will be provided a courtesy copy of the transcript. The Party making such a request shall have the obligation to arrange for and pay the court reporter.

Attachment Staff Report Item 15E
15 iv. Decision. The referees shall render a written statement of decision setting forth findings of fact and conclusions of law. The decision shall be entered as a judgment in the court in accordance with the provisions of CCP Sections 644 and 645. The decision shall be appealable to the same extent and in the same manner that such decision would be appealable if rendered by a judge of the Court. The Parties intend this general reference agreement to be specifically enforceable in accordance with the CCP. v. Expenses. Each of PPA Seller and PPA Buyer shall bear the compensation and expenses of its respective Party-Appointed Referee, own counsel, witnesses, consultants and employees. All other expenses of judicial reference shall be split equally between PPA Seller and PPA Buyer.
(f) Limitation of Liability. Notwithstanding anything to the contrary herein, all obligations of Issuer under this Agreement, including without limitation all obligations to make payments of any kind whatsoever, are special, limited obligations of Issuer, payable solely from the Trust Estate (as such term is defined in the Bond Indenture) as and to the extent provided in the Bond Indenture, including with respect to Operating Expenses (as such term is defined in the Bond Indenture). Issuer shall not be required to advance any moneys derived from any source other than the Revenues (as such term is defined in the Bond Indenture) and other assets pledged under the Bond Indenture for any of the purposes in this Agreement mentioned. Neither the faith and credit of Issuer nor the taxing power of the State of California or any political subdivision thereof is pledged to payments pursuant to this Agreement. Issuer shall not be directly, indirectly, contingently or otherwise liable for any costs, expenses, losses, damages, claims or actions, of any conceivable kind on any conceivable theory, under or by reasons of or in connection with this Agreement, except solely to the extent Revenues (as such term is defined in the Bond Indenture) are received for the payment thereof and may be applied therefor pursuant to the terms of the Bond Indenture
Attachment Staff Report Item 15E
Signature Page to Limited Assignment Agreement
IN WITNESS WHEREOF, the Parties have executed this Agreement effective as of the date first set forth above.

MORGAN STANLEY CAPITAL GROUP INC.

By: ____________________________
Name:_______________________
Title:________________________

EAST BAY COMMUNITY ENERGY AUTHORITY
By: ____________________________
Name:_______________________
Title:________________________
MORGAN STANLEY ENERGY STRUCTURING, L.L.C.

By: ____________________________
Name:_______________________
Title:________________________

CALIFORNIA COMMUNITY CHOICE FINANCING AUTHORITY
By: ____________________________
Name:_______________________
Title:________________________
Attachment Staff Report Item 15E
Appendix 1 - 1
Appendix 1
Assigned Rights and Obligations
PPA: Master Power Purchase and Sale Agreement dated February 12, 2018 and the Specified Source Product Confirmation thereunder dated as of the date hereof, by and between PPA Buyer and PPA Seller
Assigned Delivery Point: [NP15 EZ GEN HUB)]
Assigned Product Price: [CAISO NP15 Day Ahead Index for Hour Ending 01 through Hour Ending 24]
Attachment Staff Report Item 15E
Appendix 2 - 1
Appendix 2
Notice Information

IF TO PPA
SELLER:

As set forth in the PPA
IF TO MSES: Morgan Stanley Energy Structuring, L.L.C.
1585 Broadway
New York, NY 10036-8293
Email: [[email protected]]
IF TO ISSUER: California Community Choice Financing Authority 1125 Tamalpais Avenue
San Rafael, CA 94901
Email: [[email protected]]
IF TO PPA BUYER: As set forth in the PPA
Attachment Staff Report Item 15E
Appendix 3 - 1
Appendix 3
Copy of Power Sales Contract
[To be attached.]
Attachment Staff Report Item 15E
1 Chapman Draft 05.09.22

PREPAID ENERGY PROJECT ADMINISTRATION AGREEMENT
This Prepaid Energy Project Administration Agreement (this “Agreement”) is made and entered into as of [________], 2022, by and between California Community Choice Financing Authority (“CCCFA”) and East Bay Community Energy Authority (“EBCE”), with respect to the Prepaid Energy Project (defined below). CCCFA and EBCE may be referred to individually herein as a “Party” and collectively as the “Parties”. Capitalized terms used herein (including in the following Recitals) have the meanings given to such terms in Section 1.

W I T N E S S E T H:

WHEREAS, EBCE is a “community choice aggregator” under the Public Utilities Code; and WHEREAS, EBCE and certain other community choice aggregators have created CCCFA as a joint exercise of powers authority under and pursuant to the Act and the Joint Powers Agreement; and WHEREAS, CCCFA’s purpose is to assist its Members (as defined in the Joint Powers Agreement), including EBCE, by undertaking the financing or refinancing of energy prepayments that can be financed with tax advantaged bonds and other obligations on behalf of one or more of the Members by, among other things, issuing or incurring Bonds (as such term is defined in the Joint Powers Agreement) and entering into related contracts with Members; and
WHEREAS, CCCFA and EBCE are entering into a Power Supply Contract pursuant to which CCCFA has agreed to supply Energy to EBCE under the terms set forth therein; and WHEREAS, in order to provide such Energy to EBCE under the Power Supply Contract, CCCFA is entering into the Prepaid Agreement with MSES, under which it will make a prepayment to MSES for the purchase and delivery of such Energy; and
WHEREAS, CCCFA will finance the prepayment under the Prepaid Agreement and related costs by issuing the Bonds pursuant to the Indenture; and
NOW, THEREFORE, in consideration of the premises and mutual covenants set forth in this Agreement and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

Section 1. Defined Terms. Capitalized terms used herein shall have the meanings set forth below:
“Act” means Chapter 5 of Division 7 of Title 1 of the California Government Code, being Section 6500 and following, as amended.
“Alternate Energy Delivery Point” has the meaning specified in Section 5.1(a) of the Power Supply Contract.

Attachment Staff Report Item 15F
2 “Annual Refund” means the annual refund, if any, to be provided to EBCE pursuant to Section 3.2(c) of the Power Supply Contract.
“Assigned Delivery Point” has the meaning specified in the Assignment Agreement. “Assigned Energy” has the meaning specified in the Assignment Agreement. “Assigned Product” means Assigned Energy and associated renewable energy credits, green energy attributes and any other product included in the Assignment Agreement. “Assignment Agreement” means the Initial Assignment Agreement and any subsequent assignment agreement entered into consistent with the Assignment Letter Agreement. “Assignment Letter Agreement” has the meaning specified in the Power Supply Contract. “Base Energy” means Energy to be delivered to an Energy Delivery Point. “Bonds” means the bonds issued by CCCFA pursuant to the Indenture on or about the date of this Agreement in order to finance the prepayment required to be made to MSES under the Prepaid Agreement and related costs of the Prepaid Energy Project, and any bonds issued to refund such bonds.
“CCCFA” means California Community Choice Financing Authority, a joint exercise of powers authority created under and pursuant to the Act and the Joint Powers Agreement. “CCCFA Commodity Swap” means the ISDA Master Agreement, Schedule and transaction Confirmation entered into by CCCFA and the swap counterparty named therein, and any replacement swap entered into pursuant to the Prepaid Agreement. “Contract Quantity” means the quantity of Base Energy or Assigned Energy, as applicable, specified in Exhibits A-1 and A-2 of the Power Supply Contract, as such Exhibits A-1 and A-2 may be updated from time to time in accordance with the terms of the Power Supply Contract. “EBCE” means East Bay Community Energy Authority, a community choice aggregator as defined in Section 331.1 of the Public Utilities Code. “Energy” means three-phase, 60-cycle alternating current electric energy, expressed in megawatt-hours.
“Energy Delivery Point” means the delivery point for delivery of EBCE’s Contract Quantity as specified in the Power Supply Contract, and shall include, if applicable, any Assigned Delivery Point and any Alternate Delivery Point for EBCE. “Indenture” means the Trust Indenture, dated as of [_______] 1, 2022, between CCCFA and the Trustee, as amended, restated, supplemented or otherwise modified from time to time. “Initial Assignment Agreement” with respect to EBCE, the initial assignment agreement or agreements specified in the Power Supply Contract.
“Joint Powers Agreement” means the Joint Powers Agreement by and among the Members of CCCFA named therein, including EBCE, providing for the creation, purposes and powers of Attachment Staff Report Item 15F
3 CCCFA, as the same may be amended or supplemented from time to time in accordance with its terms.
“MSES” means Morgan Stanley Energy Structuring L.L.C., its successors and permitted assigns.
“Power Supply Contract” means the Power Supply Contract, dated [________], 2022, between CCCFA and EBCE relating to the purchase by EBCE of Energy acquired by CCCFA pursuant to the Prepaid Agreement, as amended, restated, supplemented or otherwise modified from time to time.
“Prepaid Agreement” means the Prepaid Energy Sales Agreement, dated [_______], 2022, between CCCFA, as buyer, and MSES, as seller, as amended, restated, supplemented or otherwise modified from time to time.
“Prepaid Energy Project” means the issuance of the Bonds by CCCFA pursuant to the Indenture, the acquisition of Energy and related undertakings of CCCFA under the Prepaid Agreement and the Indenture, and the sale to EBCE of such Energy and related undertakings of CCCFA under the Power Supply Contract.
“Public Utilities Code” means the Public Utilities Code of the State of California, as amended.
“Qualifying Use Requirements” has the meaning set forth in Section 1.1 of the Power Supply Contract.
“Re-Pricing Agreement” means the Re-Pricing Agreement, dated as of the date of issuance of the Bonds, by and between CCCFA and MSES.
“Schedule”, “Scheduled” or “Scheduling” means the actions of a Party and/or its designated representatives, including each Party’s Transmission Providers, if applicable, of notifying, requesting and confirming to each other the quantity of Energy to be delivered during any given portion of the Delivery Period at a specified Delivery Point. “Tax Certificate and Agreement” means the Tax Certificate and Agreement executed and delivered by CCCFA in connection with the issuance of the Bonds relating to certain federal income tax compliance requirements relating to the Prepaid Energy Project. “Transmission Provider(s)” means any entity or entities transmitting or transporting Energy on behalf of a Party to or from an Energy Delivery Point. “Trustee” means The Bank of New York Mellon Trust Company, N.A., and its successors as Trustee under the Indenture.

Section 2. Assignment Agreements. With respect to any Assignment Agreement, the Parties acknowledge and agree as follows:
(a) as of the date of this Agreement, EBCE has entered into the Initial Assignment Agreement specified in the Power Supply Contract with respect to its entire Contract Quantity; Attachment Staff Report Item 15F
4 (b) subject to the terms of the applicable Assignment Letter Agreement, EBCE may from time to time enter into additional Assignment Agreements with respect to all or a portion of its Contract Quantity; and
(c) EBCE shall determine, independent of CCCFA, when and if any Assignment Agreement is entered into or terminated and the underlying agreement and portion of its Contract Quantity to which such Assignment Agreement relates.

Section 3. Scheduling and Delivery of Assigned Energy. Assigned Energy and any other Assigned Product delivered to CCCFA under the Prepaid Agreement that is attributable to an Assignment Agreement(s) entered into by EBCE shall be attributable to EBCE under the Power Supply Contract, and CCCFA shall have no responsibility for (a) any Scheduling or other operational requirements necessary for the delivery of Assigned Energy to EBCE’s Assigned Delivery Point and the transfer of other Assigned Product to EBCE, or (b) any accounting for under-deliveries or over-deliveries or other record-keeping requirements with respect to any Assigned Energy and other Assigned Product, all of which shall be the sole responsibility of EBCE pursuant to the related Assignment Agreement(s).

Section 4. Qualified Use; Remarketing of Base Energy. As provided in the Power Supply Contract, any portion of EBCE’s Contract Quantity that is not delivered as Assigned Energy is required to be delivered as Base Energy and simultaneously remarketed by MSES pursuant to the Prepaid Agreement. EBCE shall be responsible for accounting for any portion of EBCE’s Contract Quantity deemed delivered as Base Energy and subsequently remarketed, including accounting for any remediation of any such remarketing sales as may be required pursuant to the Qualifying Use Requirements. EBCE agrees to provide to CCCFA any information reasonably requested by it in order to comply with any reporting or record-keeping requirements related to such deemed deliveries and remarketing of Base Energy, including such information relating to compliance with the Qualifying Use Requirements, as may be required pursuant to the Prepaid Agreement, the Indenture or the Tax Certificate and Agreement.

Section 5. CCCFA Commodity Swap. CCCFA shall not take any action to terminate or designate the early termination of the CCCFA Commodity Swap except in accordance with written instructions of EBCE or unless otherwise required under the terms of the Prepaid Agreement.

Section 6. Directions, Consents and Waivers. CCCFA may be requested or required from time to time to provide certain directions, consents, or waivers under the terms of the Prepaid Agreement, the Indenture and the Re-pricing Agreement. In the event any such direction, consent or waiver relates solely to the Contract Quantity and/or Power Supply Contract of EBCE and no event of default has occurred and is continuing with respect to EBCE under the Power Supply Contract, such direction, consent or waiver shall only be provided by CCCFA in accordance with written instructions provided by EBCE.

Otherwise, any such direction, consent or waiver shall only be provided by CCCFA in accordance with written instructions of EBCE.

Section 7. Re-pricing Information. CCCFA shall provide, or cause MSES to provide, to EBCE such information as is required to be provided by MSES to CCCFA in accordance the Re-pricing Agreement at such times as are required under the Re-pricing Agreement.

Section 9. Project Administration Fee; Reimbursement and Refund of Operating Expenses. (a) Under Section 3.2(b) of the Power Supply Contract, EBCE is required to include in its payment to CCCFA in January of each year, commencing [January 2023], an annual Project Administration Fee in the amount specified therein, determined by CCCFA based on the budgeted Attachment Staff Report Item 15F
5 Operating Expenses of CCCFA for the next succeeding annual period. CCCFA agrees to allocate amounts received in respect of the Project Administration Fee to pay Operating Expenses (as defined in the Indenture) as the same become due and payable during such annual period. In the event amounts paid in respect of the Project Administration Fee are not sufficient to pay such Operating Expenses when due, EBCE agrees to pay such additional amounts as are necessary to pay such Operating Expenses upon receipt of notice of the amount due from the Trustee or CCCFA. (b) As soon as practicable following the end of each annual period referred to in paragraph (a), CCCFA agrees to reconcile the amounts received in respect of the Project Administrative Fee for such annual period with the Operating Expenses paid or accrued for such period. In the event that, following each such reconciliation, it is determined that the amounts received in respect of the Project Administration Fee during the applicable annual period exceed Operating Expenses paid or accrued for such period, CCCFA will provide written notice thereof to EBCE and include the amount of such excess in its Annual Refund to EBCE under the Power Supply Contract.

Section 10. Notices. Notices and other information to be provided by a Party to any other Party under this Agreement shall be provided in accordance with Article XVI of the Power Supply Contract.

Section 11. Governing Law. This Agreement and the obligations of the Parties hereunder shall be governed by and determined in accordance with the laws of the State of California.

Section 12. Counterparts. This Agreement may be executed and acknowledged in multiple counterparts and by the Parties in separate counterparts, each of which shall be an original and all of which shall be and constitute one and the same instrument.

Attachment Staff Report Item 15F
6 IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first above written.

CALIFORNIA COMMUNITY CHOICE FINANCING

AUTHORITY
By: ________________________________
Name: ______________________________
Title: _______________________________

EAST BAY COMMUNITY ENERGY AUTHORITY
By: ________________________________
Name: ______________________________
Title: _______________________________
Attachment Staff Report Item 15F
HB Draft 5 May 2022

CUSTODIAL AGREEMENT
This Custodial Agreement (the “Custodial Agreement”), dated as of [____], 2022 (the “Effective Date”), is entered into by and among Natixis, a bank organized under the laws of the Republic of France (the “Swap Counterparty”), California Community Choice Financing Authority, a joint powers authority and a public entity of the State of California established pursuant to the provisions of the Joint Exercise of Powers Act (Article 1, Chapter 5, Division 7, Title 1, Section 6500 et seq. of the California Government Code, as amended) (the “Issuer”), The Bank of New York Mellon Trust Company, N.A., a national banking association, in its capacity as trustee under the Bond Indenture (defined below) (in such capacity, the “Trustee”), and The Bank of New York Mellon Trust Company, N.A., a national banking association, in its capacity as custodian hereunder (in such capacity, the “Custodian”).

WHEREAS, Issuer is issuing its Clean Energy Project Revenue Bonds, [Series 2022A] (the “Bonds”) pursuant to the Trust Indenture, dated as of [____], 2022 (the “Indenture”) between the Issuer and the Trustee; and
WHEREAS, Morgan Stanley Energy Structuring, L.L.C., a Delaware limited liability company (“MSES”), as seller, and the Issuer, as purchaser, have entered into a Prepaid Energy Sales Agreement, dated as of [____], 2022 (the “Prepaid Agreement”); and WHEREAS, in connection with the execution of the Prepaid Agreement, the Issuer and Swap Counterparty are entering into an ISDA Master Agreement, dated as of [____], 2022, together with the Schedule, dated as of [____], 2022, and a Confirmation, dated as of [____], 2022, evidencing a commodity price hedging transaction thereunder (such ISDA Master Agreement, Schedule and Confirmation, the “Front-End Commodity Swap Agreement”); and WHEREAS, concurrently with the execution of the Front-End Commodity Swap Agreement, the Swap Counterparty and MSES are entering into a corresponding commodity price hedging transaction pursuant to an ISDA Master Agreement, dated as of [____], 2022, together with the Schedule and Credit Support Annex thereto, dated as of [____], 2022, and a Confirmation, dated as of [____], 2022 (such ISDA Master Agreement, Schedule, Credit Support Annex and Confirmation, the “Back-End Commodity Swap Agreement”); and WHEREAS, the Issuer, the Swap Counterparty and the Custodian propose to enter into this Custodial Agreement in order to administer any payments from Issuer to the Swap Counterparty under the Front-End Commodity Swap Agreement.

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1. Defined Terms. Any capitalized term used herein and not otherwise defined herein (including in the recitals) shall have the meaning assigned to such term in the Indenture.

2. Appointment of Custodian. The Issuer and the Swap Counterparty hereby appoint The Bank of New York Mellon Trust Company, N.A. as Custodian under this Custodial Attachment Staff Report Item 15G
- 2 -
Agreement, with such rights and obligations as are specifically set forth herein. The Custodian hereby accepts such appointment under the terms and conditions set forth herein.

3. Payments Account.
(a) With respect to any net payments required to be made by Issuer to the Swap Counterparty under the Front-End Commodity Swap Agreement, there is hereby established with the Custodian, a payments account designated as the “[____]”, bearing the Custodian’s Account No. [____] (the “Issuer Payments Account”) using the wiring instructions below; and any and all net payments payable by Issuer to the Swap Counterparty pursuant to Section 2(a)(i) of the Front-End Commodity Swap Agreement shall be paid by wire transfer to and deposited in the Issuer Payments Account. The Swap Counterparty agrees that any payments made by Issuer into the Issuer Payments Account shall be deemed to have been made directly by Issuer to the Swap Counterparty.

The Bank of New York Mellon
New York, NY
ABA: 021000018
Account No.: [____]
FBO: [____]
Attn: Richard Dillard, 904-645-1923
For the avoidance of doubt, payments required to be made by the Swap Counterparty to the Issuer pursuant to the Front-End Commodity Swap Agreement, payments required to be made by the Swap Counterparty to MSES pursuant to the Back-End Commodity Swap Agreement and payments required to be made by MSES to the Swap Counterparty pursuant to the Back-End Commodity Swap Agreement are not subject to this Custodial Agreement. (b) Amounts deposited in the Issuer Payments Account shall be held in trust for the benefit of Issuer until applied as set forth in paragraph 3(c) below, and there is hereby granted to Issuer a lien on and security interest in the Issuer Payments Account pending such application.

The Custodian shall not be required to comply with any orders, demands or other instructions from the Swap Counterparty with respect to the Issuer Payments Account including, without limitation, items presented for payment, or any order or instruction directing the disposition of funds or other assets held in or credited to the Issuer Payments Account, except to the extent that amounts on deposit in the Issuer Payments Account are payable to the Swap Counterparty in accordance with the terms hereof and of the Front-End Commodity Swap Agreement, and the Swap Counterparty agrees that prior to the termination of this Custodial Agreement in accordance with the terms hereof, it shall have no right to direct the disposition of funds or other assets held in or credited to the Issuer Payments Account, or to withdraw or otherwise obtain funds or other assets held in or credited to the Issuer Payments Account, whether by order or instruction to the Custodian or otherwise, except to the extent that amounts on deposit in the Issuer Payments Account are payable to the Swap Counterparty in accordance with the terms hereof and of the Front-End Commodity Swap Agreement.
(c) In accordance with this subparagraph (c), the Custodian shall withdraw amounts on deposit in the Issuer Payments Account for the purpose of paying any net amount Attachment Staff Report Item 15G
- 3 -
payable to Swap Counterparty under Section 2(a)(i) of the Front-End Commodity Swap Agreement on each date on which such amount is due under the Front-End Commodity Swap Agreement, provided that if, prior to any such date, MSES has provided written notice to the Custodian, substantially in the form attached hereto as Exhibit A, by Electronic Means (defined below) to hold such payment (a “Hold Notice”), the Custodian shall withdraw such amounts only upon confirmation by MSES to the Custodian, substantially in the form attached hereto as Exhibit B, by Electronic Means (defined below) that the amount payable by the Swap Counterparty to MSES under the Back-End Commodity Swap Agreement on such date has been paid by the Swap Counterparty in accordance with the terms of the Back-End Commodity Swap Agreement. Subject to paragraph 3(d) below in the case of any withdrawal by the Custodian from the Issuer Payments Account and payment to MSES in accordance with paragraph 3(d), upon confirmation by the Custodian that MSES has received such payment due from the Swap Counterparty under the Back-End Commodity Swap Agreement, the Custodian (either automatically or, if a Hold Notice has been delivered, upon Custodian’s receipt of confirmation by MSES in accordance with the preceding sentence) shall withdraw from the Issuer Payments Account the amount due to the Swap Counterparty under the Front-End Commodity Swap Agreement on such date (or such later date upon which payment from Issuer is received under the terms of the Front-End Commodity Swap Agreement and this Custodial Agreement) and pay such amount to the Swap Counterparty by wiring funds to the following account:

For the Account of: Natixis (Natixis Capital Market)
Bank: Deutsche Bank Trust
Company Americas, New York (BKTRUS33)
Fedwire: 021001033
Ultimate Beneficiary: NATXFRPPMAR
Account Number: 04437031
(d) Notwithstanding Section 2(a)(iii) of the Back-End Commodity Swap Agreement or the exercise by or on behalf of MSES of any right of early termination of the Back-End Commodity Swap Agreement, in the event that any amount due to MSES under Section 2(a)(i) of the Back-End Commodity Swap Agreement (including any Unpaid Amounts (as defined in Part 5(b) of the Schedule to the Back-End Commodity Swap Agreement) payable by the Swap Counterparty under the Back-End Commodity Swap Agreement) is not paid when due and remains unpaid as of the close of business on the last day of any grace period for such payment under the terms of the Back-End Commodity Swap Agreement and the Prepaid Agreement, the Custodian shall withdraw from the Issuer Payments Account an amount equal to the amount so due and unpaid under the Back-End Commodity Swap Agreement and pay such amount to MSES. (e) If at any time the Front-End Commodity Swap Agreement terminates or otherwise ceases to be in effect for any reason, then during the period commencing on the date when the Front-End Commodity Swap Agreement terminates or ceases to be in effect until the earlier of (i) the date on which both the Back-End Commodity Swap Agreement and the Front-End Commodity Swap Agreement have been replaced in accordance with Section 17.5 of the Prepaid Agreement and (ii) the date of termination of the Prepaid Agreement (the “Issuer Payments Period”), Issuer shall deposit into the Issuer Payments any and all net payments that would have been payable by the Issuer to Swap Counterparty during the Issuer Payments Period pursuant to Section 2(a)(i) of the Front-End Commodity Swap if the Front-End Commodity Swap had not Attachment Staff Report Item 15G
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terminated. Deposits made by Issuer to the Issuer Payments Account in accordance with this Section 3(e) shall be withdrawn by the Custodian and paid to MSES.

4. Custodian. The Custodian shall have (a) no liability under any agreement other than this Custodial Agreement and (b) no duty to inquire as to the provisions of any agreement other than this Custodial Agreement, the Back-End Commodity Swap Agreement and the Front-End Commodity Swap Agreement. The Custodian may rely upon and shall not be liable for acting or refraining from acting upon any written notice, document, instruction or request furnished to it hereunder and reasonably believed by it to be genuine and to have been signed or presented by the proper party or parties. The Custodian shall be under no duty to inquire into or investigate the validity, accuracy or content of any such document, notice, instruction or request. The Custodian shall have no duty to solicit or compel any payments which may be due to it. The Custodian shall not be liable for any action taken or omitted by it in good faith except to the extent that a court of competent jurisdiction determines that the Custodian’s gross negligence or willful misconduct was the cause of any loss. In connection with the execution of any of its powers or the performance of any of its duties hereunder, the Custodian may consult with counsel, accountants and other skilled persons selected and retained by it. The Custodian shall not be liable for anything done, suffered or omitted in good faith by it in accordance with the advice or opinion of any such counsel, accountants or other skilled persons, provided the Custodian exercised due care and good faith in the selection of such person. In the event that the Custodian shall be uncertain as to its duties or rights hereunder or shall receive instructions, claims or demands from any party hereto which, in its opinion, conflict with any of the provisions of this Custodial Agreement, it shall be entitled to refrain from taking any action and its sole obligation shall be to keep safely all property held in escrow until it shall be directed otherwise in writing by all of the other parties hereto or by a final order or judgment of a court of competent jurisdiction. The Custodian may interplead all of the assets held hereunder into a court of competent jurisdiction or may seek a declaratory judgment with respect to certain circumstances, and thereafter be fully relieved from any and all liability or obligation with respect to such interpleaded assets or any action or non-action based on such declaratory judgment. Anything in this Custodial Agreement to the contrary notwithstanding, in no event shall the Custodian be liable for special, indirect, incidental, consequential or punitive damages, losses or penalties of any kind whatsoever (including but not limited to lost profits), regardless of the form of action. The Custodian may engage and act through agents and attorneys and shall not be liable for the misconduct or negligence of any such agent or attorney appointed with due care. Nothing herein shall obligate or be construed to obligate the Custodian to advance its own funds, or to expend or risk its own funds. The Custodian shall not be liable for any action taken by it in good faith in accordance with instruction received in accordance with this Custodial Agreement, or for the application of funds by or other actions or omissions of other persons. Any permissive right or power granted to the Custodian hereunder shall not be construed as a duty to act. The Custodian shall not be obliged to invest or pay interest on funds held hereunder, unless and except to the extent otherwise expressly agreed in writing. The Custodian shall not be responsible for the perfection of any security interest granted hereunder.

5. Succession. The Custodian may resign and be discharged from its duties or obligations hereunder by giving not less than 30 days’ advance notice in writing of such resignation to the other parties hereto specifying a date when such resignation shall take effect; provided, however, that in the event of such resignation, The Bank of New York Mellon Trust Company, Attachment Staff Report Item 15G
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N.A. (“BNYM”) shall at the same time resign from its duties and obligations as custodian under that certain Custodial Agreement dated as of the date hereof by and among MSES, the Swap Counterparty, the Trustee and BNYM as custodian thereunder (in such capacity, the “Back-End Custodian”) pertaining to the administration of payments under the Back-End Commodity Swap Agreement (the “Back-End Swap Custodial Agreement”). Such resignation under this Custodial Agreement shall take effect upon the day specified in such notice unless a successor shall not have been appointed by Issuer and the Swap Counterparty (with the consent of MSES, as provided below) on such date, in which event such resignation shall not take effect until a successor is appointed. Issuer and the Swap Counterparty shall use their commercially reasonable efforts to make such appointment in a timely fashion, provided that any custodian appointed in succession to the Custodian shall be a bank or trust company organized under the laws of any state or a national banking association and shall have capital stock, surplus and undivided earnings aggregating at least $50,000,000 and shall be a bank with trust powers or a trust company willing and able to accept the office on reasonable and customary terms and authorized by law to perform all the duties imposed upon it by this Custodial Agreement; provided, further, however, that such appointment of a successor to the Custodian hereunder shall be subject to the consent of MSES, and such appointed successor hereunder shall be the same custodian appointed as successor to the Back-End Custodian under the Back-End Swap Custodial Agreement. If Issuer and the Swap Counterparty fail or are unable to appoint a successor within sixty (60) days of such notice of resignation, with the consent of MSES, the Custodian shall be entitled to petition a court of competent jurisdiction to appoint a successor. Said court may thereupon, after such notice, if any, as such court may deem proper, appoint a successor Custodian. Any corporation or association into which the Custodian may be merged or converted or with which it may be consolidated, or any corporation or association to which all or substantially all of the Custodian’s corporate trust line of business may be transferred, shall be the Custodian under this Custodial Agreement without further act.

6. Fees. Issuer agrees to (a) pay the Custodian reasonable compensation for the services to be rendered hereunder, which compensation shall be $[____] for each year that this Custodial Agreement is in effect, and (b) pay or reimburse the Custodian upon request for all expenses, disbursements and advances, including reasonable attorneys’ fees and expenses, incurred or made by it in connection with the preparation, execution, performance, delivery, modification and termination of this Custodial Agreement. The parties hereto acknowledge that this provision shall survive the resignation or removal of the Custodian or the termination of this Custodial Agreement.

7. Reimbursement. Issuer agrees to reimburse the Custodian and its directors, officers, agents and employees for any and all loss, liability or expense (including the fees and expenses of in-house or outside counsel and experts and their staffs and all expense of document location, duplication and shipment) arising out of or in connection with (a) the Custodian’s execution and performance of this Custodial Agreement, except to the extent such loss, liability or expense is finally adjudicated to have been primarily caused by the gross negligence or willful misconduct of the Custodian or its director, officer, agent or employee seeking reimbursement, or (b) its following any instructions or other directions from Issuer, except to the extent that its following any such instruction or direction is expressly forbidden by the terms hereof. The parties hereto acknowledge that this provision shall survive the resignation or removal of the Custodian or the termination of the Custodial Agreement.

Attachment Staff Report Item 15G
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8. Taxpayer Identification Numbers; Tax Matters. Issuer and the Swap Counterparty each represent that its correct taxpayer identification number assigned by the Internal Revenue Service or any other taxing authority is set forth on the signature page hereof. Any tax returns or reports required to be prepared and filed in connection with the Issuer Payments Account will be prepared and filed by Issuer or the Swap Counterparty, as appropriate, and the Custodian shall have no responsibility for the preparation and/or filing of any tax return with respect to any income earned on the Issuer Payments Account. In addition, any tax or other payments required to be made pursuant to such tax return or filing shall be paid by Issuer or the Swap Counterparty, as appropriate. The Custodian shall have no responsibility for making such payment unless directed to do so in writing by the appropriate authorized party and fully indemnified to the Custodian’s satisfaction.

9. Notices. All communications hereunder shall be in writing and shall be deemed to be duly given and received (a) upon delivery if delivered personally, upon confirmed transmittal if by facsimile and as set forth in the final paragraph of this Section 9 if by e-mail transmission; (b) on the next Business Day if sent by overnight courier; or (c) four (4) Business Days after mailing if mailed by prepaid registered mail, return receipt requested, to the appropriate notice address for Issuer or the Swap Counterparty, as applicable, set forth in the Front-End Commodity Swap Agreement. Notices to the Custodian shall be provided to the following address:

The Bank of New York Mellon Trust Company, N.A.
4655 Salisbury Road, Suite 300
Jacksonville, Florida 32256
Attention: Corporate Trust
Fax: 904.645.1998
Email: [email protected]
Any party may provide a new or different address for such notices if furnished to the other parties in writing by registered mail, return receipt requested. Notwithstanding the above provisions of this Section 9, in the case of communications delivered to the Custodian pursuant to clause (b) or clause (c) of this Section 9, such communications shall be deemed to have been given on the date received by the Custodian. In the event that the Custodian, in its sole discretion, shall determine that an emergency exists, the Custodian may use such other means of communication as the Custodian deems appropriate.

The Custodian shall have the right to accept and act upon directions given pursuant to this Custodial Agreement, or any other document reasonably relating to the Front-End Commodity Swap Agreement, the Back-End Commodity Swap Agreement or other matters described herein, delivered using Electronic Means (defined below); provided, however, that each party giving directions to the Custodian hereunder shall provide to the Custodian an incumbency certificate, substantially in the form attached hereto as Exhibit B-2, listing persons with the authority to provide such directions (each an “Authorized Officer”) and containing specimen signatures of such Authorized Officers, which incumbency certificate shall be amended whenever a person is to be added or deleted from the listing. If a party elects to give the Custodian directions using Electronic Means and the Custodian in its discretion elects to act upon such directions, the Custodian’s understanding of such directions shall be deemed controlling. The parties understand and agree that the Custodian cannot determine the identity of the actual sender of such directions and that Attachment Staff Report Item 15G
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the Custodian shall conclusively presume that directions that purport to have been sent by an Authorized Officer listed on the incumbency certificate provided by a party to the Custodian have been sent by such Authorized Officer. Each party shall be responsible for ensuring that only Authorized Officers transmit such directions to the Custodian and that all Authorized Officers treat applicable user and authorization codes, passwords and/or authentication keys issued by the Custodian as confidential and with extreme care. The Custodian shall not be liable for any losses, costs or expenses arising directly or indirectly from the Custodian’s reliance upon and compliance with such directions notwithstanding that such directions conflict or are inconsistent with a subsequent written direction. Each party agrees: (i) to assume all risks arising out of the use of Electronic Means to submit directions to the Custodian, including without limitation the risk of the Custodian acting on unauthorized directions, and the risk of interception and misuse by third parties; (ii) that it is fully informed of the protections and risks associated with the various methods of transmitting directions to the Custodian and that there may be more secure methods of transmitting directions; (iii) that the security procedures (if any) to be followed in connection with its transmission of directions provide to it a commercially reasonable degree of protection in light of its particular needs and circumstances; and (iv) to notify the Custodian immediately upon learning of any compromise or unauthorized use of the security procedures.

As used herein, “Electronic Means” shall mean the following communications methods: e-mail, facsimile transmission, secure electronic transmission containing applicable authorization codes, passwords and/or authentication keys issued by the Custodian, or another method or system specified by the Custodian as available for use in connection with its services hereunder.

Notwithstanding anything to the contrary herein, a party may at any time notify the other parties in accordance with this Custodial Agreement that any subsequent notice or other communication hereunder must be provided by e-mail transmission for a specified period of time or until further notice, and any notices or other communications delivered by means other than e-mail transmission during such time shall be ineffective. Such notice will not be effective unless it includes a valid e-mail address for the party requesting that notices and other communications be delivered by e-mail transmission. Such party will take reasonable steps to ensure the continued availability of such e-mail address for the receipt of notices and other communications hereunder and will promptly notify the other parties in accordance with this Custodial Agreement of a change or modification as to the e-mail address or its availability to receive notices and other communications. Notices or other communications sent by e-mail transmission will be deemed to have been delivered when sent, if sent during the recipient’s business hours, or upon the commencement of the recipient’s business hours, if sent outside of recipient’s business hours; provided that (i) any such notice by e-mail shall not be effective if a “bounce-back”, system error message or other notification of non-delivery is received by the sender and (ii) in such case the noticing party may provide notices and communications by any other means permitted under this Custodial Agreement or may attempt providing notice again by e-mail (and any such follow-up e-mail notice shall be effective under the terms set forth above so long as a non-delivery notice is not received with respect thereto).

Attachment Staff Report Item 15G
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10. Miscellaneous.
(a) The provisions of this Custodial Agreement may be waived, altered, amended or supplemented, in whole or in part, only by a writing signed by all of the parties hereto. (b) Neither this Custodial Agreement nor any right, title or interest hereunder may be assigned in whole or in part by any party, without the prior written consent of the other parties, except as provided in Section 5; provided that, notwithstanding the foregoing, the parties acknowledge and agree that Issuer shall assign all of its right, title and interest in, to and under this Custodial Agreement in connection with any assignment by Issuer of its right, title and interest in, to and under the Front-End Commodity Swap Agreement to the assignee thereof, which assignment shall constitute a novation.
(c) This Custodial Agreement and the rights and duties of the parties hereunder shall be governed by and construed, enforced, and performed in accordance with the laws of the State of New York, without regard to any conflicts of law principle that would direct the application of the laws another jurisdiction; provided, however, that the authority of the Issuer to enter into and perform its obligations under this Custodial Agreement shall be determined in accordance with the laws of the State of California.
(d) Each party hereto irrevocably waives any objection on the grounds of venue, forum non-conveniens or any similar grounds and irrevocably consents to service of process by mail or in any other manner permitted by applicable law and consents to the jurisdiction of any court of the State of New York located in the Borough of Manhattan, or of the United States District Court located in the Borough of Manhattan. The parties further hereby waive any right to a trial by jury with respect to any lawsuit or judicial proceeding arising or relating to this Custodial Agreement.
(e) No party to this Custodial Agreement shall be liable to any other party hereto for losses due to, or if it is unable to perform its obligations under the terms of this Custodial Agreement because of, acts of God, fire, war, terrorism, floods, strikes, electrical outages, equipment or transmission failure, or other causes reasonably beyond its control. (f) This Custodial Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. All signatures of the parties to this Custodial Agreement may be transmitted by facsimile or by digital pdf transmission under the terms set forth in this Section 10(f). The parties agree that the electronic signature of a party to this Custodial Agreement, including all acknowledgements, authorizations, directions, waivers and consents thereto (or any amendment or supplement thereto) shall be as valid as an original signature of such party and shall be effective to bind such party to this Custodial Agreement. The parties agree that any electronically signed document (including this Custodial Agreement) shall be deemed (i) to be “written” or “in writing,” (ii) to have been signed, and (iii) to constitute a record established and maintained in the ordinary course of business and an original written record when printed from electronic files. For purposes hereof, “electronic signature” means a manually signed original signature that is then transmitted by electronic means; “transmitted by electronic means” means sent in the form of a facsimile or sent via the Internet as a pdf (portable document format) or other replicating image attached to an Attachment Staff Report Item 15G
- 9 -
e mail message; and, “electronically signed document” means a document transmitted by electronic means and containing, or to which there is affixed, an electronic signature. Paper copies or “printouts”, if introduced as evidence in any judicial, arbitral, mediation or administrative proceeding, will be admissible as between the parties to the same extent and under the same conditions as other original business records created and maintained in documentary form. Neither party shall contest the admissibility of true and accurate copies of electronically signed documents on the basis of the best evidence rule or as not satisfying the business records exception to the hearsay rule

11. Compliance with Court Orders. In the event that any amount held by the Custodian hereunder shall be attached, garnished or levied upon by any court order, or the delivery thereof shall be stayed or enjoined by an order of a court, or any order, judgment or decree shall be made or entered by any court affecting the property deposited under this Custodial Agreement, the Custodian is hereby expressly authorized, in its sole discretion, to obey and comply with all writs, orders or decrees so entered or issued, which it is advised by legal counsel of its own choosing are binding upon it, whether with or without jurisdiction, and in the event that the Custodian obeys or complies with any such writ, order or decree it shall not be liable to any of the parties hereto or to any other person, firm or corporation, by reason of such compliance notwithstanding that such writ, order or decree may be subsequently reversed, modified, annulled, set aside or vacated.

12. Term; Winding Up. This Custodial Agreement will expire at the later of (i) the receipt of written notice from either Issuer or the Swap Counterparty to the other parties that the Front-End Commodity Swap Agreement has terminated in accordance with its terms and (ii) the expiration of the Issuer Payments Period, if any. Any remaining balance in the Issuer Payments Account following written confirmation from MSES that all required payments by the Swap Counterparty to MSES under the Back-End Commodity Swap Agreement have been received by MSES shall be paid to the Swap Counterparty.

13. Indemnification. Issuer and the Swap Counterparty, jointly and severally, agree to protect, indemnify, defend and hold harmless, the Custodian, and its affiliates, and each person who controls the Custodian from and against all claims, damages, losses, liabilities, actions, suits, costs, judgments and expenses (including, without limitation, court costs and reasonable attorneys’ fees) arising from its acting as Custodian hereunder, except for any such claim, damage, loss, liability, action, suit, cost, judgment or expense resulting from the gross negligence or willful misconduct of the Custodian; provided, however, that any amounts due under this Section 13 shall not duplicate any other amounts due under this Custodial Agreement, including without limitation amounts due under Section 7 hereof. The obligations of this Section 13 shall survive any resignation or removal of the Custodian and the termination of this Custodial Agreement. In addition, notwithstanding anything herein to the contrary, the Custodian shall have all of the rights (including the indemnification rights), benefits, privileges and immunities granted to the Trustee under the Indenture, all of which are incorporated, mutatis mutandis, into this Custodial Agreement.

14. Patriot Act. Issuer and the Swap Counterparty acknowledge that the Custodian is subject to federal laws, including the Customer Identification Program (“CIP”) requirements under the USA PATRIOT Act and its implementing regulations, pursuant to which the Custodian must Attachment Staff Report Item 15G
- 10 -
obtain, verify and record information that allows the Custodian to identify Issuer and the Swap Counterparty. Accordingly, prior to opening the Issuer Payments Account described in Section 3 of this Custodial Agreement, the Custodian will ask Issuer and the Swap Counterparty to provide certain information including but not limited to name, physical address, tax identification number and other information that will help the Custodian identify and verify the identity of Issuer and the Swap Counterparty, such as organizational documents, certificate of good standing, license to do business, or other pertinent identifying information. Issuer and the Swap Counterparty agree that the Custodian cannot open any account hereunder unless and until the Custodian verifies the identity of Issuer and the Swap Counterparty each in accordance with its CIP. [Signatures appear on the next page]
Attachment Staff Report Item 15G
[Signature Page of the Custodial Agreement]
IN WITNESS WHEREOF, the parties hereto have executed this Custodial Agreement as of the date first set forth above.

CALIFORNIA COMMUNITY CHOICE FINANCING

AUTHORITY
By:

Name:

Title:

Taxpayer ID Number: ______________________

NATIXIS
By:

Name:

Title:

Taxpayer ID Number: ______________________

THE BANK OF NEW YORK MELLON TRUST
COMPANY, N.A., as Custodian
By:

Name:

Title:

THE BANK OF NEW YORK MELLON TRUST
COMPANY, N.A., as Trustee
By:

Name:

Title:

Attachment Staff Report Item 15G

EXHIBIT A
[LETTERHEAD OF MORGAN STANLEY ENERGY STRUCTURING, L.L.C.] [Date]
The Bank of New York Mellon Trust Company, N.A.
4655 Salisbury Road, Suite 300
Jacksonville, Florida 32256
Attention: Corporate Trust
Fax: 904.645.1998
Email: [email protected]
Re: Custodial Agreement by and among California Community Choice Financing Authority (“Issuer”), Natixis (“Swap Counterparty”), The Bank of New York Mellon Trust Company, N.A. (the “Trustee”), and The Bank of New York Mellon Trust Company, N.A. (the “Custodian”) dated as of [____], 2022 (the “Custodial Agreement”)

HOLD NOTICE
Pursuant to and in accordance Section 3(c) of the Custodial Agreement, the undersigned Authorized Officer of Morgan Stanley Energy Structuring, L.L.C. does hereby issue this Hold Notice to the Custodian, directing the Custodian to withdraw amounts on deposit in the Issuer Payments Account for the purpose of paying any net amount payable to Swap Counterparty under Section 2(a)(i) of the Front-End Commodity Swap Agreement on the immediately subsequent Business Day (as defined in the Indenture) to the date hereof on which such amount is due under the Front-End Commodity Swap Agreement only upon confirmation by MSES to the Custodian in accordance with Section 3(c) of the Custodial Agreement that the amount payable by the Swap Counterparty to MSES under the Back-End Commodity Swap Agreement on such date has been paid by the Swap Counterparty in accordance with the terms of the Back-End Commodity Swap Agreement.

Capitalized terms used herein and not otherwise defined shall have the meaning assigned in the Custodial Agreement.

MORGAN STANLEY ENERGY STRUCTURING, L.L.C.

By: ______________________________________
Name:

Title:
cc: California Community Choice Financing Authority
Attachment Staff Report Item 15G
EXHIBIT B-1
[LETTERHEAD OF MORGAN STANLEY ENERGY STRUCTURING, L.L.C.] [Date]
The Bank of New York Mellon Trust Company, N.A.
4655 Salisbury Road, Suite 300
Jacksonville, Florida 32256
Attention: Corporate Trust
Fax: 904.645.1998
Email: [email protected]
Re: Custodial Agreement by and among California Community Choice Financing Authority (“Issuer”), Natixis (“Swap Counterparty”), The Bank of New York Mellon Trust Company, N.A. (the “Trustee”), and The Bank of New York Mellon Trust Company, N.A. (the “Custodian”) dated as of [____], 2022 (the “Custodial Agreement”)

CONFIRMATION
Pursuant to and in accordance Section 3(c) of the Custodial Agreement, the undersigned Authorized MSES Representative does hereby confirm that the full amount of the payment due from Swap Counterparty to MSES under the Back-End Commodity Swap Agreement has been received this day.

Capitalized terms used herein and not otherwise defined shall have the meaning assigned in the Custodial Agreement.

MORGAN STANLEY ENERGY STRUCTURING, L.L.C.

By: ______________________________________
Name:

Title:
cc: [_____]
Attachment Staff Report Item 15G
EXHIBIT B-2

FORM OF CERTIFICATE OF
[_________________________________]
The undersigned, a duly authorized officer of [__________________________], in connection with the Custodial Agreement by and among California Community Choice Financing Authority (“Issuer”), Natixis (“Swap Counterparty”), The Bank of New York Mellon Trust Company, N.A. (the “Trustee”), and The Bank of New York Mellon Trust Company, N.A. (the “Custodian”) dated as of [____], 2022 (the “Custodial Agreement”), HEREBY CERTIFIES that the persons whose names, titles and signatures appear below are duly qualified and acting representatives of [_______] (“Authorized Representatives”) on the date hereof. Each holds the office set forth beside his/her name, and the signature appearing opposite his/her name is the genuine signature of such Authorized Representative. Only those individuals, or such additional individuals as the undersigned may designate prior to written notice to the Custodian in the future, shall execute and deliver any written instructions, confirmations or certificates on behalf of [_______] in connection with the Custodial Agreement. Custodian shall not be obligated to accept any written instructions, confirmations or certificates executed by an individual other than those listed below or so designated in the future.

NAME TITLE PHONE NO. SIGNATURE
Capitalized terms used herein and not otherwise defined shall have the meaning assigned in the Custodial Agreement.
[___________] acknowledges that Custodian will accept notices by Electronic Means only if [_________] acknowledges and assumes all risks relating to the use of such notices. [_______] hereby acknowledges and assumes all risks relating to the sending of notices by Electronic Means.

IN WITNESS WHEREOF, the undersigned has caused this Certificate to be executed for and on behalf of [__________] this ___day of __________. [NAME OF PARTY]
By: _____________________________________
Name:

Title:

Attachment Staff Report Item 15G
OHS DRAFT 3/29/22
4151-0817-6694.2

TRUST INDENTURE
between

CALIFORNIA COMMUNITY CHOICE FINANCING AUTHORITY
and
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,
as Trustee
$__________
Clean Energy Project Revenue Bonds
Series 2022A-1 (Term Rate)
and
Series 2022A-2 ([SIFMA] Index Rate)
Dated as of __________ 1, 2022
Attachment Staff Report Item 15H
-i-4151-0817-6694.2

TABLE OF CONTENTS
PAGE
ARTICLE I. DEFINITIONS AND GOVERNING LAW ...................................................................3 Section 1.01. Definitions ......................................................................................................3 Section 1.02. Captions ........................................................................................................29 Section 1.03. Rules of Construction ...................................................................................29 Section 1.04. Governing Law .............................................................................................30 Section 1.05. Consents ........................................................................................................30 ARTICLE II. AUTHORIZATION AND ISSUANCE OF BONDS ......................................................30 Section 2.01. Authorization of Bonds and Refunding Bonds; Application of Proceeds ....30 Section 2.02. Terms of Series 2022A Bonds; Payment ......................................................31 Section 2.03. Conditions for Issuance of Bonds .................................................................33 Section 2.04. Initial Interest Rate Periods; Subsequent Interest Rate Periods ....................34 Section 2.05. Daily Interest Rate Period .............................................................................35 Section 2.06. Weekly Interest Rate Period .........................................................................36 Section 2.07. Term Rate Period .........................................................................................38 Section 2.08. Commercial Paper Interest Rate Periods ......................................................40 Section 2.09. Index Rate Periods ........................................................................................42 Section 2.10. Notice of Conversion ....................................................................................45 Section 2.11. Liquidity Facility ..........................................................................................46 Section 2.12. Provisions Regarding Commodity Swap ......................................................46 Section 2.13. Provisions Regarding Interest Rate Swap .....................................................48 Section 2.14. CPI Index Rate Periods .................................................................................49 ARTICLE III. GENERAL TERMS AND PROVISIONS OF BONDS ............................................52 Section 3.01. Medium of Payment; Form and Date; Letters and Numbers ........................52 Section 3.02. Legends .........................................................................................................53 Section 3.03. Execution and Authentication .......................................................................53 Section 3.04. Exchange, Transfer and Registry ..................................................................54 Section 3.05. Regulations With Respect to Exchanges and Registration of Transfers ......55 Section 3.06. Bonds Mutilated, Destroyed, Stolen or Lost.................................................55 Section 3.07. Temporary Bonds .........................................................................................56 Section 3.08. Payment of Interest on Bonds; Interest Rights Preserved.............................56 Section 3.09. Book Entry System; Appointment of Securities Depository ........................57 Section 3.10. Subsidy Payments .........................................................................................59 Section 3.11. Limitation of Liability of the Issuer ..............................................................59 ARTICLE IV. REDEMPTION OF BONDS AND TENDER PROVISIONS ..........................................59 Section 4.01. Extraordinary Redemption ............................................................................59 Section 4.02. Sinking Fund Redemption ............................................................................60 Section 4.03. Optional Redemption ....................................................................................62 Section 4.04. Redemption Notice .......................................................................................64 Attachment Staff Report Item 15H
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Section 4.05. Bonds Redeemed in Part ...............................................................................66 Section 4.06. Redemption at the Election or Direction of Issuer .......................................66 Section 4.07. Redemption Other Than at Issuer’s Election or Direction ...........................66 Section 4.08. Selection of Bonds To Be Redeemed ...........................................................66 Section 4.09. Payment of Redeemed Bonds .......................................................................67 Section 4.10. Cancellation and Destruction of Bonds ........................................................67 Section 4.11. Optional Tender During Daily or Weekly Interest Rate Periods ..................67 Section 4.12. Mandatory Tender for Purchase on Day Next Succeeding the Last Day of Each CP Interest Term ..................................................................................68 Section 4.13. Mandatory Tender for Purchase on the Mandatory Purchase Date, Index Rate Tender Date or Fixed Rate Tender Date ...............................................68 Section 4.14. Mandatory Tender for Purchase on Conversion of Interest Rate Period ......69 Section 4.15. General Provisions Relating to Tenders .......................................................69 Section 4.16. Notice of Mandatory Tender for Purchase ...................................................72 Section 4.17. Irrevocable Notice Deemed to Be Tender of Bond; Undelivered Bonds Deemed Purchased on Mandatory Purchase Date ........................................73 Section 4.18. Remarketing of Bonds; Notice of Interest Rates ..........................................73 Section 4.19. The Remarketing Agent ................................................................................74 Section 4.20. Qualifications of Remarketing Agent; Resignation; Removal .....................74 Section 4.21. Successor Remarketing Agents ....................................................................74 Section 4.22. Tender Agent ................................................................................................75 ARTICLE V. ESTABLISHMENT OF FUNDS AND APPLICATION THEREOF .................................75 Section 5.01. Pledge Effected by This Indenture................................................................75 Section 5.02. Establishment of Funds and Accounts ..........................................................76 Section 5.03. Project Fund ..................................................................................................77 Section 5.04. Revenues and Revenue Fund; Other Amounts .............................................78 Section 5.05. Payments from Revenue Fund ......................................................................79 Section 5.06. Operating Fund .............................................................................................80 Section 5.07. Debt Service Fund—Debt Service Account .................................................81 Section 5.08. Debt Service Fund–Redemption Account ....................................................83 Section 5.09. Commodity Swap Payment Fund .................................................................83 Section 5.10. General Fund.................................................................................................83 Section 5.11. Energy Remarketing Reserve Fund ..............................................................84 Section 5.12. Assignment Payment Fund ...........................................................................85 Section 5.13. Purchases of Bonds .......................................................................................85 Section 5.14. Administrative Fee Fund ..............................................................................85 ARTICLE VI. DEPOSITORIES OF MONEYS, SECURITY FOR DEPOSITS AND INVESTMENT OF FUNDS .........................................................................................................86 Section 6.01. Depositories ..................................................................................................86 Section 6.02. Deposits ........................................................................................................86 Section 6.03. Investment of Certain Funds .........................................................................87 Section 6.04. Valuation and Sale of Investments ...............................................................88 Attachment Staff Report Item 15H
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ARTICLE VII. PARTICULAR COVENANTS OF ISSUER ................................................................89 Section 7.01. Payment of Bonds .........................................................................................89 Section 7.02. Extension of Payment of Bonds ...................................................................89 Section 7.03. Offices for Servicing Bonds .........................................................................90 Section 7.04. Further Assurance .........................................................................................90 Section 7.05. Power To Issue Bonds and Pledge the Trust Estate......................................90 Section 7.06. Power To Fix and Collect Fees and Charges for the Sale of Energy............90 Section 7.07. Creation of Liens ..........................................................................................90 Section 7.08. Reserved........................................................................................................91 Section 7.09. Limitations on Operating Expenses and Other Costs. ..................................91 Section 7.10. Amendments to Energy Supply Contracts ....................................................91 Section 7.11. Power Supply Contracts; Energy Remarketing ...........................................92 Section 7.12. Energy Purchase Agreement; Energy Supplier Guaranty .............................93 Section 7.13. Reserved........................................................................................................93 Section 7.14. Commodity Swap .........................................................................................93 Section 7.15. Interest Rate Swap ........................................................................................94 Section 7.16. Accounts and Reports ...................................................................................94 Section 7.17. Payment of Taxes and Charges .....................................................................95 Section 7.18. Tax Covenants ..............................................................................................95 Section 7.19. General ..........................................................................................................96 Section 7.20. Bankruptcy ....................................................................................................96 Section 7.21. Reserved........................................................................................................97 Section 7.22. Replacement of Energy Supplier Guaranty ..................................................97 Section 7.23. Avoidance of Failed Remarketing ................................................................97 ARTICLE VIII. EVENTS OF DEFAULT AND REMEDIES ...............................................................97 Section 8.01. Events of Default ..........................................................................................97 Section 8.02. Accounting and Examination of Records After Default ...............................98 Section 8.03. Enforcement of Agreements; Application of Moneys after Default .............98 Section 8.04. Appointment of Receiver ............................................................................100 Section 8.05. Proceedings Brought by Trustee. ................................................................100 Section 8.06. Restriction on Bondholder’s Action ...........................................................101 Section 8.07. Remedies Not Exclusive. ............................................................................101 Section 8.08. Effect of Waiver and Other Circumstances. ...............................................102 Section 8.09. Notice of Default ........................................................................................102 ARTICLE IX. CONCERNING THE FIDUCIARIES ......................................................................102 Section 9.01. Acceptance by Trustee of Duties ................................................................102 Section 9.02. Paying Agents; Appointment and Acceptance of Duties............................102 Section 9.03. Responsibilities of Fiduciaries ....................................................................102 Section 9.04. Evidence on Which Fiduciaries May Act ...................................................104 Section 9.05. Compensation .............................................................................................105 Section 9.06. Certain Permitted Acts ................................................................................105 Section 9.07. Resignation of Trustee ................................................................................105 Section 9.08. Removal of the Trustee ...............................................................................105 Attachment Staff Report Item 15H
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Section 9.09. Appointment of Successor Trustee .............................................................106 Section 9.10. Transfer of Rights and Property to Successor Trustee ...............................106 Section 9.11. Merger or Consolidation .............................................................................107 Section 9.12. Adoption of Authentication ........................................................................107 Section 9.13. Resignation or Removal of Paying Agent and Appointment of Successor. ...................................................................................................107 Section 9.14. Trustee’s Reliance.......................................................................................107 Section 9.15. Trustee’s Liability .......................................................................................108 Section 9.16. Trustee’s Agents or Attorneys ....................................................................109 Section 9.17. Notice of Lien Filings .................................................................................109 ARTICLE X. SUPPLEMENTAL INDENTURES .........................................................................110 Section 10.01. Supplemental Indentures Not Requiring Consent of Bondholders .............110 Section 10.02. Supplemental Indentures Effective With Consent of Bondholders ............111 Section 10.03. General Provisions ......................................................................................112 ARTICLE XI. AMENDMENTS .................................................................................................113 Section 11.01. Mailing ........................................................................................................113 Section 11.02. Powers of Amendment................................................................................113 Section 11.03. Consent of Bondholders..............................................................................113 Section 11.04. Notifications by Unanimous Consent .........................................................115 Section 11.05. Exclusion of Bonds .....................................................................................115 Section 11.06. Notation on Bonds ......................................................................................115 ARTICLE XII. MISCELLANEOUS ............................................................................................115 Section 12.01. Defeasance ..................................................................................................115 Section 12.02. Evidence of Signatures of Bondholders and Ownership of Bonds .............119 Section 12.03. Moneys Held for Particular Bonds .............................................................119 Section 12.04. Preservation and Inspection of Documents ................................................120 Section 12.05. Parties Interested Herein .............................................................................120 Section 12.06. No Recourse on the Bonds; Non -Liability of the Issuer ............................120 Section 12.07. Publication of Notice; Suspension of Publication ......................................120 Section 12.08. Publication of Notice; Suspension of Publication ......................................120 Section 12.09. Severability of Invalid Provisions...............................................................121 Section 12.10. Holidays ......................................................................................................121 Section 12.11. Notices ........................................................................................................121 Section 12.12. Notices to Rating Agencies.........................................................................122 Section 12.13. Counterparts ................................................................................................122 Section 12.14. Waiver of Jury Trial ....................................................................................122 Section 12.15. Electronic Signatures ..................................................................................123 Attachment Staff Report Item 15H
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Exhibit A — Form of Bonds
Exhibit B — Form of Index Rate Determination Certificate Exhibit C — [Reserved]
Exhibit D — [Reserved]
Exhibit E — [Reserved]
Schedule I — Initial Project Participants
Schedule II — Scheduled Debt Service Deposits
Schedule III — Terms of Commodity Swaps
Schedule IV — Amortized Value of Series 2022A-1 Bonds
Attachment Staff Report Item 15H
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TRUST INDENTURE
THIS TRUST INDENTURE, dated as of __________ 1, 2022 (this “Indenture”), is by and between California Community Choice Financing Authority, a joint powers authority and public entity of the State of California (the “Issuer”) and The Bank of New York Mellon Trust Company, N.A., a national banking association organized and existing under the laws of the United States and authorized to accept and execute trusts of the character herein, as trustee (the “Trustee”).

W ITNESSET H:

WHEREAS, pursuant to the provisions of the Act (capitalized terms used herein and not otherwise defined shall have the meanings given such terms in Section 1.01 hereof), Central Coast Community Energy, East Bay Community Energy, Marin Clean Energy, and Silicon Valley Clean Energy (each a “Member” and, collectively, the “Members”) entered into a joint powers agreement pursuant to which the Issuer was organized and established for the purpose, among other things, of entering into contracts for electricity and energy services and agreements for services to facilitate the sale and purchase of electricity and other related services, and for issuing bonds to assist the Members in financing such contracts, agreements, purchases, sales and services; and WHEREAS, the Issuer is authorized under the Act to acquire electricity and energy services and enter into agreements for services to facilitate the sale and purchase of electricity and other related services, and to issue revenue bonds to finance the cost of acquisition of such electricity and energy services and other agreements, and is vested with all powers necessary to accomplish the purposes for which it was created; and
WHEREAS, the Issuer has determined to finance the Cost of Acquisition of the Clean Energy Project through the issuance of Bonds pursuant to this Indenture; and WHEREAS, the execution and delivery of this Indenture has been in all respects duly and validly authorized and approved by resolution of the Board of the Issuer; and WHEREAS, the Trustee is willing to accept the trusts provided for in this Indenture.

NOW, THEREFORE, THIS INDENTURE WITNESSETH, and the Issuer and the Trustee agree as follows for the benefit of the other, for the benefit of the Holders of the Bonds issued pursuant hereto and the other parties secured hereby:

GRANTING CLAUSES
FOR AND IN CONSIDERATION OF the premises, the mutual covenants of the Issuer and the Trustee herein, the purchase of the Bonds by the Holders thereof and the obligations of the Interest Rate Swap Counterparty under the Interest Rate Swap, and in order to secure:

Attachment Staff Report Item 15H
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(i) the payment of the principal of and premium, if any, and interest on the Bonds and the payment of the Interest Rate Swap Payments, in each case according to the tenor and effect of the Bonds and the Interest Rate Swap, and (ii) the performance and observance by the Issuer of all the covenants expressed or implied in this Indenture and in the Bonds,
the Issuer does hereby convey, assign and pledge unto the Trustee and its successors in trust, all right, title and interest of the Issuer in and to the Trust Estate, subject to conveyance, assignment and pledge of the Commodity Swap Payment Fund in favor of the Commodity Swap Counterparty as set forth below, and further subject to the provisions of this Indenture permitting the application thereof for the purposes and on the terms and conditions set forth in this Indenture, and all other rights hereinafter granted for the further securing of the Bonds; FOR AND IN CONSIDERATION OF the obligations of the Commodity Swap Counterparty under the Commodity Swap and the mutual covenants of the Issuer and the Commodity Swap Counterparty thereunder, and in order to secure the payment of the Commodity Swap Payments, the Issuer does hereby convey, assign and pledge unto the Trustee and its successors in trust, all right, title and interest of the Issuer in the Commodity Swap Payment Fund and the amounts on deposit therein, subject to the provisions of this Indenture permitting the application thereof for the purposes and on the terms and conditions set forth in this Indenture, which conveyance, assignment and pledge shall have priority over the foregoing conveyance, assignment and pledge of the Commodity Swap Payment Fund and the amounts and investments on deposit therein in favor of the Bonds and the Interest Rate Swap Payments; TO HAVE AND TO HOLD all the same with all privileges and appurtenances hereby and hereafter conveyed and assigned, or agreed or intended so to be, to the Trustee and its respective successors in said trust and assigns forever;
IN TRUST NEVERTHELESS, upon the terms and trusts herein set forth for the equal and proportionate benefit, security and protection of (i) all Holders of the Bonds without privilege, priority or distinction as to the lien or otherwise of any Bond over any other Bond or the payment of interest with respect to any Bond over the payment of interest with respect to any other Bond, except as otherwise provided herein, and (ii) the Interest Rate Swap Counterparty; and PROVIDED, HOWEVER, that if the Issuer, its successors or assigns shall well and truly pay, or cause to be paid, the principal or Redemption Price, if any, on the Bonds and the interest due or to become due thereon, the Commodity Swap Payments and the Interest Rate Swap Payments, at the times and in the manner provided in the Bonds, the Commodity Swap and the Interest Rate Swap, respectively, according to the true intent and meaning thereof, and shall cause the payments to be made into the Funds as required hereunder, or shall provide, as permitted hereby, for the payment thereof as provided in Section 12.01, and shall well and truly keep and perform and observe all the covenants and conditions of this Indenture to be kept, performed and observed by it, and shall pay or cause to be paid to the Trustee all sums of money due or to become due to it in accordance with the terms and provisions hereof, then upon such final payments or provisions for such payments by the Issuer, the Bonds, the Commodity Swap and the Interest Rate Swap shall Attachment Staff Report Item 15H
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cease to be entitled to any lien, benefit or security under this Indenture, and all covenants, agreements and obligations of the Issuer to the Holders of the Bonds shall thereupon cease, terminate and be discharged and satisfied; otherwise this Indenture shall remain in full force and effect.

The terms and conditions upon which the Bonds are to be issued, authenticated, delivered, secured and accepted by all Persons who from time to time shall be or become the Holders thereof, and the trusts and conditions upon which the Revenues, moneys, securities and funds held or set aside under this Indenture, subject to the provisions of this Indenture permitting the application thereof for the purposes and on the terms and conditions set forth in this Indenture, are to be held and disposed of, which said trusts and conditions the Trustee hereby accepts, and the respective parties hereto covenant and agree, are as follows:

ARTICLE I

DEFINITIONS AND GOVERNING LAW
Section 1.01. Definitions. The following terms shall, for all purposes of this Indenture, have the following meanings:
“Account” or “Accounts” means, as the case may be, each or all of the Accounts established in Sections 4.15 and 5.02.
“Accountant’s Certificate” means a certificate signed by an independent certified public accountant or a firm of independent certified public accountants, selected by the Issuer, who may be the accountant or firm of accountants who regularly audit the books of the Issuer and must be identified upon selection in writing to the Trustee.
“Act” means the Joint Exercise of Powers Act constituting Chapter 5 of Division 7 of Title 1 (commencing with Section 6500), as amended or supplemented from time to time. “Administrative Fee Fund” means the Administrative Fee Fund established in Section 5.02. “Alternate Liquidity Facility” means a Liquidity Facility for a Series of Bonds delivered to the Trustee in substitution for a Liquidity Facility then in effect with respect to such Bonds. “Amortized Value” means, with respect to any Bond to be redeemed when a Term Rate Period is in effect with respect to such Bond, the principal amount of such Bond multiplied by the price of such Bond expressed as a percentage, calculated by a major market maker in municipal securities, as the quotation agent, selected by the Issuer, based on the industry standard method of calculating bond prices (as such industry standard prevailed on the date such Bond began to bear interest at its current Term Rate), with a delivery date equal to the date of redemption of such Bond, a maturity date equal to the earlier of (a) the stated maturity date of such Bond or (b) the Term Rate Tender Date of such Bond and a yield equal to such Bond’s original reoffering yield on the date such Bond began to bear interest at its current Term Rate, which, in the case of the Attachment Staff Report Item 15H
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initial Term Rate Period for the Series 2022A-1 Bonds and certain dates, produces the amounts for all of the Series 2022A-1 Bonds set forth in Schedule IV; provided that in the case of a redemption of the Series 2022A-1 Bonds pursuant to Section 4.03(b), the Amortized Value of the Series 2022A-1 Bonds shall be the percentage of the principal amount thereof for the applicable redemption date set forth in Section 4.03(b).
“Applicable Factor” means (a) with respect to the initial issuance of a Series of Bonds bearing interest at a SOFR Index Rate, the percentage or factor of the SOFR Index determined by the Underwriter and specified in the Index Rate Determination Certificate for such Series of Bonds, or (b) with respect to a Series of Bonds for which the Interest Rate Period is being converted to a SOFR Index Rate Period (including a change in such Interest Rate Period from one SOFR Index Rate Period to another SOFR Index Rate Period), the percentage or factor of the SOFR Index determined by the Remarketing Agent and specified in the applicable Index Rate Determination Certificate or Index Rate Continuation Notice, provided in each case that the Issuer delivers to the Trustee a Favorable Opinion of Bond Counsel addressing the selection of such percentage or factor. The Applicable Factor shall be determined by the Underwriter or the Remarketing Agent, as applicable, in accordance with Section 2.09(a) and included in the applicable Index Rate Determination Certificate, and once determined shall remain constant for the duration of the applicable SOFR Index Rate Period.
“Applicable Spread” means, with respect to a Series of Bonds for which the Initial Interest Rate Period is an Index Rate Period, or for any Series of Bonds for which the Interest Rate Period is converted to an Index Rate Period, the margin or spread, which may be positive or negative, determined by the Underwriter or the Remarketing Agent, as applicable, in accordance with Section 2.09(a), on or prior to the Issue Date or Conversion Date for such Bonds, as applicable, and specified in the applicable Supplemental Indenture or Index Rate Determination Certificate, as applicable, which shall be added to the applicable Index (or the product of the Applicable Factor and the applicable Index, as the case may be) to determine the Index Rate. Once so determined, Applicable Spread shall remain constant for the duration of the applicable Index Rate Period. “Applicable Tax Exempt Municipal Bond Rate” means, for the Bonds of any maturity, the “Comparable AAA General Obligations” yield curve rate for the year of such maturity or Mandatory Purchase Date, as applicable, as published by Refinity at least one Business Day and not more than 15 Business Days prior to the date that notice of redemption is required to be given pursuant to Section 4.04. If no such yield curve rate is established for the applicable year, the “Comparable AAA General Obligations” yield curve rate for the two published maturities most closely corresponding to the applicable year shall be determined, and the Applicable Tax Exempt Municipal Bond Rate will be interpolated or extrapolated from those yield curve rates on a straight line basis. This rate is made available daily by Refinity and is available to its subscribers through the internet address: www.tm3.com. In calculating the Applicable Tax Exempt Municipal Bond Rate, should Refinity no longer publish the “Comparable AAA General Obligations” yield curve rate, then the Applicable Tax Exempt Municipal Bond Rate shall equal the Consensus Scale yield curve rate for the applicable year. The Consensus Scale yield curve rate is made available daily by Municipal Market Analytics and is available to its subscribers through its internet address:
www.mma research.com. In the further event Municipal Market Analytics no longer publishes the Consensus Scale, the Applicable Tax Exempt Municipal Bond Rate shall be determined by a Attachment Staff Report Item 15H
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major market maker in municipal securities, as the quotation agent, based upon the rate per annum equal to the annual yield to maturity, calculated using semi-annual compounding, of those tax exempt general obligation bonds rated in the highest Rating Category by Moody’s and S&P with a maturity date equal to the stated maturity date or Mandatory Purchase Date, as applicable, of such Bonds having characteristics (other than the ratings) most comparable to those of such Bonds in the judgment of the quotation agent. The quotation agent’s determination of the Applicable Tax Exempt Municipal Bond Rate shall be final and binding on all parties in the absence of manifest error and may be conclusively relied upon in good faith by the Trustee. “Assignment Payment” means any payment received from the Energy Supplier in connection with an assignment of the Energy Purchase Agreement to a replacement energy supplier.
“Assignment Payment Fund” means the Assignment Payment Fund established in Section 5.02.
“Attesting Party” means an individual authorized by a resolution of the Board to attest the signatures of Authorized Officers.
“Authorized Denominations” means with respect to any (a) Term Rate Period or Index Rate Period, $5,000 and any integral multiple thereof, and (b) Commercial Paper Interest Rate Period, Daily Interest Rate Period or Weekly Interest Rate Period, $100,000 and any integral multiple of $1,000 in excess of $100,000.
“Authorized Newspaper” means The Wall Street Journal or The Bond Buyer or any other newspaper or journal printed in the English language and customarily published on each Business Day devoted to financial news and selected by the Issuer, with prior written notice to and approval of the Trustee, whose decision shall be final.
“Authorized Officer” means (a) the Treasurer/Controller of the Issuer, and (b) any other person or persons designated by the Board by resolution to act on behalf of the Issuer under this Indenture. The designation of such person or persons shall be evidenced by a Written Certificate of the Issuer delivered to a Responsible Officer of the Trustee containing the specimen signature of such person or persons and signed on behalf of the Issuer by its Treasurer/Controller. Such designation as an Authorized Officer shall remain in effect until a Responsible Officer of the Trustee receives actual written notice from the Issuer to the contrary, accompanied by a new certificate.
“Beneficial Owner” means, with respect to Bonds registered in the Book Entry System, any Person who acquires a beneficial ownership interest in a Bond held by the Securities Depository, and the term “Beneficial Ownership” shall be interpreted accordingly. “BLS” means the Bureau of Labor Statistics of the U.S. Department of Labor. “Board” means the Board of Directors of the Issuer, or if said Board is abolished, the board, body, commission or agency succeeding to the principal functions thereof or to whom the Attachment Staff Report Item 15H
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power and duties granted or imposed by this Indenture are given by law, and which shall be identified in a Written Notice of the Issuer delivered to the Trustee. “Bond” or “Bonds” means any of the Bonds and Refunding Bonds authorized by Section 2.01 of, and at any time Outstanding pursuant to, this Indenture. “Bond Counsel” means Orrick, Herrington & Sutcliffe LLP or any other counsel of nationally recognized standing in matters pertaining to the tax exempt status of interest on obligations issued by states and their political subdivisions and instrumentalities, duly admitted to the practice of law before the highest court of any state of the United States, and selected by the Issuer.
“Bond Payment Date” means each date on which (a) interest on the Bonds is due and payable, (b) an Interest Rate Swap Payment is due, or (c) principal of the Bonds is payable at maturity or pursuant to Sinking Fund Installments.
“Bond Purchase Fund” means the fund by that name established pursuant to Section 4.15(a), including the Remarketing Proceeds Account and the Issuer Purchase Account therein.
“Bond Registrar” means the Trustee and any other bank or trust company organized under the laws of any state of the United States of America or national banking association appointed by the Issuer to perform the duties of Bond Registrar under this Indenture. “Bondholder” or “Holder of Bonds” or “Holder” or “Owner” means any Person who shall be the registered owner of any Bond or Bonds.
“Book Entry System” means the system maintained by the Securities Depository and described in Section 3.09.
“Business Day” means any day other than (a) a Saturday or Sunday, (b) a day on which commercial banks in New York, New York, or the cities in which are located the designated corporate trust offices of the Trustee, the Custodian or a Calculation Agent or the operational office of the Issuer are authorized by law or executive order to close, (c) a day on which the New York Stock Exchange, Inc. is closed, (d) a day on which the payment system of the Federal Reserve System is not operational, and (e) for purposes of determining the SIFMA Index Rate and the SOFR Index Rate, any day that SIFMA recommends that the fixed income departments of its members be closed for purposes of trading in United States government securities. “Calculation Agent” means, with respect to any Series of Bonds bearing interest at an Index Rate, the Calculation Agent with respect to such Bonds appointed by the Issuer, with written notice to the Trustee, pursuant to the applicable Calculation Agent Agreement and the Indenture.

Ava Community Energy Board of DirectorsMay 18, 2022

Ava Community Energy Board of Directors
May 18, 2022