Agenda Packet (949 pgs) — Ava Community Energy Board of Directors, June 17, 2026 (part 1 of 6)

Board of Directors Meeting
Wednesday, June 17, 2026
6:00 pm
In Person:

Board Room
Ava Community Energy
1999 Harrison St, Ste 2300
Oakland, CA 94612
Or from the following locations:
• Clipper Club – 5 Captain Dr. Emeryville, CA 94608
• 4917 Knowlson Terrace, Fremont, CA 94555
• 35653 Scarborough Dr Newark, CA 94560
• 1100 Webster St, 2nd Floor Conference Room, Oakland, CA 94607 • 501 W Weber Ave Building 1 Stockton CA 95203
Via Zoom:
https://avaenergy-org.zoom.us/j/87023071843
Or join by phone:

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
Ava Community Energy
Board of Directors Page | 2

3. Public Comment
This item is reserved for persons wishing to address the Board on any Ava-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 Public Comment

5. Closed Session
a. PUBLIC EMPLOYEE PERFORMANCE EVALUATION Pursuant to Government Code Section 54957. Title: Chief Executive Officer
b. CONFERENCE WITH LABOR NEGOTIATORS Pursuant to Government Code Section 54957.6. Agency Representatives: Inder Khalsa, Jonathan Tedesco, Betsy Andersen, and González. Unrepresented employee: Chief Executive Officer.

6. Report Out of Closed Session

CONSENT AGENDA

7. Approval of Minutes from May 20, 2026

8. Contracts Entered Into (Informational Item)

9. FY 2025-2026 Q3 Financial Statements (Informational Item) Ava’s third quarter financial statements for fiscal year 2025-2026

10.PFM Financial Advisors Contract (Action Item)
Authorize staff to retain PFM Financial Advisors LLC for consulting services related to prepayment bond transactions.

11.Fourth Amendment Renewing SmartBidder Master Agreement with Ascend Analytics LLC (Action Item)
Authorize CEO to negotiate and sign a fourth amendment renewing the Agreement for a new one-year term.

REGULAR AGENDA
Pursuant to Board direction, any agenda item not started by 9:00 p.m. will be continued to a future meeting unless the Board, by majority vote, elects to hear the item that evening.

The Board may also determine an alternate disposition of the item at its discretion.

Ava Community Energy
Board of Directors Page | 3

12.CEO Report

13.CAC Report

14.FY 2026-2027 Annual Budget (Action Item)
Approve the FY 2026-2027 budget

15.Prepay Financings (Action Item)
Authorize staff to enter into all agreements necessary to transact and close two to three Prepay Bond transactions

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

17.Adjourn
The next Ava Board of Directors meeting will be held on Wednesday, July 15, 2026 at 6pm.

Board Meeting Access Instructions
If you need help finding or accessing the building, please call our Ava representative who is stationed in the building lobby: 510-393-0492.

Directions
Directions via BART
If you are taking BART: the 19th Street station is the closest stop to our office and is about a 5 minute walk away. Use the 20th St / Thomas L. Berkeley Way station exit.

Directions via Bike
Bike riders wanting to park their bike inside the parking garage can enter through the main building lobby. Bike parking is available on the parking garage first level right in front of the garage elevators.

Directions to Parking Garage via Car
The entrance to the building’s attached garage is located on Harrison Street. If you’re driving northbound on Harrison Street, as soon as you cross 19th St. the garage entrance is 3/4 down on your left-hand side. If you’re heading east on Thomas L Berkeley Way/20th St.

Continue East then make a right turn on Harrison
Street, and the garage entrance is a quarter block up
on your right-hand side.

When you arrive, enter via the gate labeled “Public
Parkers”. There are four floors of the parking garage,
and you will need to take the elevator in the parking
garage to the first floor. The parking attendant or
an Ava representative will provide access into the
building lobby.

The parking garage entry gate will be open until 8pm
for CAC and BOD meetings. Attendees can exit the
parking garage until 11pm.

Note that the garage’s parking fee is $30 per use.

Street parking is widely available near the building
and free after 6pm.

Check-in at Security Desk
When you arrive at our building, please check in with the security desk in the lobby to get access to the elevators.

If you have questions or need assistance, an Ava representative will be stationed and identifiable in the lobby. They can be reached at: 510-393-0492.

Public Parkers entrance
1999 Harrison Street, Suite 2300, Oakland, CA 94612

Draft Minutes
Board of Directors Meeting
Wednesday, May 20, 2026
6:00 pm
In Person:

Board Room
Ava Community Energy
1999 Harrison St, Ste 2300
Oakland, CA 94612
Or from the following locations:
• Clipper Club – 5 Captain Dr. Emeryville, CA 94608
• 4917 Knowlson Terrace, Fremont, CA 94555
• City of Pleasanton – 200 Old Bernal, Pleasanton, CA 94566 • Stockton City Hall – 425 N El Dorado St., Stockton, CA 95202 • 1755 Harvest Landing Ln., Tracy, CA 95376
Via Zoom:
https://avaenergy-org.zoom.us/j/87023071843
Or join by phone:

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. (00:24) Welcome & Roll Call
Ava Community Energy
Board of Directors Page | 2

Present: Members: Marquez (Alameda County), Lopez (Albany), Tregub (Berkeley), , Kaur (Emeryville), Keng (Fremont), Roche (Hayward), Barrientos (Livermore), Jorgens (Newark), Balch (Pleasanton), Fugazi (Stockton), Bedolla (Tracy), Sakakihara (Union City), CAC Chair Souza (Community Advisory Committee), Vice-Chair Gonzalez (San Leandro) and Chair Andersen (Piedmont)
Not Present: Members: Morada (Dublin), Diallo (Lathrop), Brown (Oakland) and Rickman (San Joaquin County)
Alternate Member Jorgens served as representative for the City of Newark (Del Catancio).

Alternate Member Bedolla served as the representative for the City of Tracy (Nygard).

Vice-Chair Gonzalez joined the meeting at 6:50pm.

2. (2:27) Pledge of Allegiance

3. (2:50) Public Comment
This item is reserved for persons wishing to address the Board on any Ava-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. (3:11) Public Comment – Gerard Manning, speaking on behalf of his daughter Tara Manning, urged the board to support the Bay Area Air District’s proposed Clean Air Standards phasing out gas water heaters in favor of electric heat pumps. Mr. Manning encouraged Ava to develop an interest-free, on-bill financing program for heat pump water heaters, similar to other CCAs and municipal districts, ahead of the Air District’s October vote.

CONSENT AGENDA

4. Approval of Minutes from April 15, 2026

5. Contracts Entered Into (Informational Item)
During the meeting, corrected April 15, 2026 Board of Directors minutes were distributed to the Board to reflect revisions to Item 11 – Procurement Policy Update, including clarification that Member Tregub accepted two friendly amendments prior to consideration of the substitute motion, and a correction to include Member Marquez’s vote in the tally for Consent Item 6 – CAC appointments.

Ava Community Energy
Board of Directors Page | 3
(6:37) Member Tregub motioned to approve the Consent Agenda including the corrected minutes. Member Roche seconded the motion, which was approved 13/0/0/0/5 (yes/no/abstain/recuse/not present):

Yes: Members: Marquez, Lopez, Tregub, Kaur, Keng, Roche, Barrientos, Jorgens, Balch, Fugazi, Bedolla, Sakakihara and Chair Andersen
No: none
Abstain: none
Recuse: none
Not Present: Members: Morada, Diallo, Brown, Rickman and Vice-Chair Gonzalez

REGULAR AGENDA
Pursuant to Board direction, any agenda item not started by 9:00 p.m. will be continued to a future meeting unless the Board, by majority vote, elects to hear the item that evening.

The Board may also determine an alternate disposition of the item at its discretion.

6. (9:59) CEO Report
Howard Chang, CEO, presented the CEO Report and answered questions from the Board. A written version of the report is available in the May 20, 2026 agenda packet. (19:04) Public Comment – Bradley Cleveland, an Oakland resident and consultant with IBEW Local 595, urged Ava Community Energy to apply the workforce and environmental justice selection criteria referenced in Ava’s recently adopted Procurement Policy— including local hire, targeted hire, and apprenticeship requirements—to all future Ava Charge DC fast charging projects currently planned or in development.

7. (23:01) CAC Report
CAC Chair Souza presented a spoken CAC Report and answered questions from the Board.

No public comment

8. (26:37) Integrated Resource Planning (IRP) Process Overview (Informational Item) Review the compliance IRP process and timing of submission, and a preview of initial analysis
Marie Fontenot, Senior Vice President of Power Resources, presented the IRP Process Overview and answered questions from the Board.

No public comment.

9. (1:20:18) Fiscal Year 2026-2027 Draft Budget Review (Informational Item) Review the estimated draft budget for the next fiscal year Howard Chang, CEO, presented the FY 2026-2027 Draft Budget Review and answered questions from the Board.

Ava Community Energy
Board of Directors Page | 4
Public Comment:
(2:18:09) Fangxue Zheng
(2:19:56) Jessica Tovar
(2:21:15) Bradley Cleveland
(2:23:20) Jed Holtzman
(2:25:25) Sam Fishman
(2:27:25) Colin Andrew Logan
(2:29:30) Margie Lewis
(2:31:34) Susan Silber
Multiple speakers expressed concern regarding the proposed no planned incremental contributions to Local Development Funding in the Fiscal Year 2026-2027 Draft Budget and encouraged Ava to continue funding community-based programs and initiatives.

Speakers referenced topics including electrification, resilience hubs, workforce development, local hiring, rebates, public health, community partnerships, and support for disadvantaged communities, and several speakers encouraged Ava to replenish the fund in future years if a surplus becomes available.
(2:33:57) Public Comment - Dohee Kim commented on public transparency regarding the update to Item 9. Fiscal Year 2026-2027 Draft Budget Review presentation materials.

Dohee Kim also encouraged Ava to consider workforce development opportunities and potential revenue-generating strategies related to distributed energy resources and local economic development.

10.(2:40:01) City of San Leandro’s request for default service plan change (Informational Item)
Update the Board about the City of San Leandro’s request to change their default service plan to Bright Choice
Alex DiGiorgio, Senior Public Engagement Manager, presented the City of San Leandro’s request for default service plan change and answered questions from the Board.

No public comment.

11.(2:46:56) Board Member and Staff Announcements including requests to place items on future Board of Directors Meeting Agendas
• Vice-Chair Gonzalez encouraged Ava to explore future opportunities to align electrification programs with Bay Area Air District goals, particularly by supporting higher-impact electrification measures such as heat pump water heaters for low-income households.

Ava Community Energy
Board of Directors Page | 5
• Member Tregub also expressed support for a future presentation regarding potential alignment between Ava programs and the Air District’s proposed building appliance electrification rules and related customer support efforts.

12.(2:49:04) Adjourn
The meeting was adjourned at 8:56pm.

The next Ava Board of Directors meeting will be held on Wednesday, June 17, 2026 at 6pm.
5/20/26 – Ava Board of Directors
AI Generated Courtesy Summary - not official minutes
This summary has not been reviewed for accuracy

1. Welcome & Roll Call
Chair Betsy Andersen called the Board of Directors meeting to order at 6:07 PM at Ava Community Energy headquarters, 1999 Harrison Street, Suite 2300, Oakland, California 94612, Altamonte Conference Room.

Present: Alameda County, Albany, Berkeley, Dublin, Emeryville, Fremont, Hayward, Livermore, Newark, Oakland, Pleasanton, San Joaquin County/Stockton, Tracy, Union City, San Leandro, Piedmont, Community Advisory Committee. A quorum was established.

2. Pledge of Allegiance
The Pledge of Allegiance was recited.

3. Public Comment
One member of the public, Gerard Manning, speaking on behalf of his daughter Tara Manning (a Berkeley resident), urged the Board to explore on-bill financing programs for heat pump water heater electrification, noting that several other CCAs have implemented such programs and that the Bay Area Air District's pending clean air standards create urgency for action. CEO Howard Chang responded that staff is actively engaged with a broad working group of CCAs and the Air District, evaluating financing solutions, incentives, and contractor support programs for heat pump water heaters and HVAC transitions, though no specific program commitment was ready at that time.

CONSENT AGENDA

4. Approval of Minutes from April 15, 2026

5. Contracts Entered Into (Informational Item)
The Clerk noted that the April 15, 2026 minutes had been corrected since posting to more fully describe the procurement policy motion, including the acceptance of two friendly amendments, and to correct a voting record error for one member on Item 6.

Motion to approve Consent Agenda Items 4 and 5 was made and seconded by Director Roche. The motion carried with all present members voting aye.

REGULAR AGENDA

6. CEO Report
CEO Howard Chang presented the quarterly CEO Report. Key highlights included:

The Executive Committee attempted a meeting on May 6 but lost quorum; an initial draft budget was reviewed on a purely informational basis. The next XCOM meeting is scheduled for June 3 at 3:00 PM.

The CalCCA Annual Conference, held May 12–14 in Sacramento, marked CalCCA's tenth anniversary. Ten Ava board members attended. CalCCA now represents 25 CCAs serving over 15 million Californians and has signed over 21 gigawatts of new renewable energy generation statewide. Staff members CEO Howard Chang, Marie Fontenot, Dan Baratoldi, and Dominic Faria served as panelists.

The San Joaquin County Launch is proceeding smoothly. Customer enrollment began in May and, as of May 11, the participation rate stands at approximately 92 percent. Solar customer enrollment will begin in June to align with true-up cycles.

Ava in DC: Ava's policy team joined 22 participants representing 14 CCAs across California, Massachusetts, New Hampshire, New York, and Ohio for federal legislative engagement and education on the CCA model.

A quarterly local development program update was provided in table format, covering transportation electrification, building electrification, resilience programs, and community grants. Staff noted that seven NEM 2 critical municipal facilities projects are on track for completion. The Hayward Juneteenth event was noted to be held at Mount Eden High School, not Heritage Plaza as listed.

Director Marquez requested that future updates continue to highlight workforce development and apprenticeship opportunities, particularly given current economic pressures in the community.

Public comment was received from Bradley Cleveland, consultant with IBEW Local 595, requesting that Ava's procurement policy workforce standards—including local hire, targeted hire, and apprenticeship provisions—be applied to all future AVA Charge DCFC public charging station projects, including the four projects described as shovel-ready and eight in the pipeline.

7. CAC Report
CAC Chair Souza reported that the Community Advisory Committee held an orientation meeting on Monday covering Ava's structure, the difference between investor-owned utilities and CCAs, member roles, and procedural rules. Staff members Alex, JP, Adrian, Annie, and Kelly facilitated the session. Most attendees were newly appointed members. Chair Souza expressed enthusiasm for the new membership and encouraged each CAC member to develop a direct relationship with their corresponding board member to serve as a community conduit. The meeting recognized outgoing long-term CAC member Cynthia Landry with a gift of appreciation.

Chair Souza noted the session did not have time to review the budget or other program items.

8. Integrated Resource Planning (IRP) Process Overview
(Informational Item)
Director of Regulatory Affairs John Newton and Director Marie Fontenot presented an overview of Ava's Integrated Resource Planning compliance process. This was an informational item intended to familiarize the Board with the submission requirements and preliminary analysis ahead of a formal approval request at the July board meeting.

State law requires load-serving entities such as Ava to participate in the CPUC's IRP program. LSE plans must be submitted by August 10, 2026 and will inform the CPUC's Preferred System Plan and ultimately the CAISO's transmission planning process. The filing consists of three required documents: a Resource Data Template, a Clean System Power Calculator workbook, and a Narrative Template—all in CPUC-prescribed formats. Required inputs, including load forecasts and GHG benchmarks, are mandated by other state agencies including the California Energy Commission and the California Air Resources Board.

The presentation noted that Ava has brought IRP modeling capabilities fully in-house. Preliminary model results were shown to illustrate how different model constraints—such as annual new build capacity limits—produce significantly different portfolio compositions. The model identified potential value in adding geothermal resources to Ava's portfolio, which staff indicated will inform an upcoming long-term resource RFO. CEO Chang emphasized that the IRP is primarily a compliance exercise, with highly prescribed assumptions, and that Ava's actual procurement decisions are guided by separate internal analysis.

Directors raised questions regarding data center demand incorporated in the CEC load forecast, the distinction between megawatt and megawatt-hour metrics, the planning reserve margin, and the treatment of in-state versus out-of-state wind. Staff confirmed that data center growth and electrification together account for significant projected demand increases—from approximately 9 terawatt-hours annually to approximately 19 terawatt-hours by 2045. Staff also noted a new Director of Strategic Load role has been created to develop relationships with planning departments and large load customers across Ava's territory.

The Vice Chair requested that, when the filing is brought for board approval in July, the presentation clearly frame what the CPUC requires and demonstrate that each requirement has been satisfied, to enable informed board approval.

9. Fiscal Year 2026-2027 Draft Budget Review (Informational Item)
CEO Howard Chang, with support from finance staff, presented the draft Fiscal Year 2026–2027 budget. This was an informational item; formal approval is scheduled for the June 17, 2026 board meeting following review at the Finance and Audit Subcommittee and XCOM.

A significant development occurred on May 15, when PG&E filed an updated Energy Resource Recovery Account (ERRA) filing that materially changed the budget figures. As a result, the budget packet was updated and reposted within 24 hours of the meeting.

Current Fiscal Year Context (FY 2025–26): Ava is projecting a net position of approximately $83 million for the current fiscal year, reflecting better-than-budgeted performance due primarily to softening energy market prices and mid-year adjustments to the value proposition, operating expenditures, and local development contributions.

FY 2026–27 Draft Budget Summary: The base case projects an approximately neutral net position. Revenues are projected at approximately $810 million, slightly lower than the current fiscal year despite load growth, primarily due to declining energy market prices and associated rate adjustments. Retail load is forecasted to grow from approximately 8.4 terawatt-hours to 9 terawatt-hours, reflecting the addition of unincorporated San Joaquin County. The cost of energy is projected at approximately $756 million—lower than the current year despite higher load, owing to softer commodity prices. Overhead operating expenditures reflect modest increases driven by changes in accounting treatment for credit facility fees, additional software and cybersecurity costs, and the conclusion of a sublease resulting in higher rent obligations.

Staffing is proposed to grow by five FTEs to a total of 108, in areas of contract management, finance, optimization engineering, and data analysis.

Local Development Fund: No incremental contribution to the Local Development Fund is proposed for FY 2026–27, given the approximately neutral budget position and the existing fund balance of nearly $84 million, of which approximately $29 million is committed to active or planned projects. CEO Chang stated the board should expect opportunities to revisit this at mid-year.

Scenario Analysis: Staff presented low and high scenarios reflecting energy price volatility. The low scenario— assuming a one-standard-deviation decline in brown power prices—produces a net loss of approximately $40 million. The high scenario—using elevated RPS and RA assumptions from PG&E's ERRA filing—produces a net gain of approximately $27 million.

Multiple members of the public urged the Board to restore funding to the Local Development Fund, citing the impact of the December 2025 mid-year reallocation, the need for building electrification programs, community resilience investments, and workforce development. Speakers included representatives from Local Clean Energy Alliance, IBEW Local 595, Rocky Mountain Institute, SPUR, Reclaim Our Power, and individual community members.

Director Roche noted that the $84 million fund balance reflects years of committed contributions and expressed confidence in returning to funding the Local Development Fund when a surplus is realized. Director Trager requested a sensitivity analysis showing the impact of a partial contribution (e.g., $5 million) and a multi-year spend-down projection for committed funds. CEO Chang acknowledged the importance of local development investment and indicated a mid-year review would provide an opportunity to revisit the contribution level.

Staff noted that future budget processes will likely avoid the early May XCOM review, given that the ERRA filing typically arrives in mid-May with material budget implications.

10. City of San Leandro's request for default service plan change (Informational Item)
Public Engagement Manager Alex DiGiorgio presented an informational update on the City of San Leandro's request to change its citywide default service option from Renewable 100 to Bright Choice. The San Leandro City Council passed a resolution making this request, consistent with Ava's default rate product change policy.

San Leandro has approximately 20,000 residential accounts and 3,500 nonresidential accounts, representing approximately 3 percent of Ava's total load. Municipal accounts are anticipated to remain on Renewable 100.

Customers wishing to remain on Renewable 100 would retain that option if the change is approved.

Staff is currently conducting financial impact analysis. Results and potential mitigation options will be presented to the Board at a future meeting for action. The policy's standard implementation timeline of board approval by May 31 for a March implementation has not been met; an adjusted timeline may be arranged between the CEO and the City of San Leandro per the terms of the policy.

Chair Andersen noted that as Bright Choice's renewable content increases toward the 2030 carbon-free goal, the distinction between the two products—and the financial impact of switching—will diminish over time.

11. Board Member and Staff Announcements including
requests to place items on future Board of Directors Meeting Agendas
The Vice Chair, who also serves on the Bay Area Air District Board, requested that staff consider, through a future process, how Ava might align its electrification spending with the Air District's goals of reducing indoor combustion pollution—particularly through high-impact items such as heat pump water heaters for lower-income households. Director Trager seconded this interest, requesting a future presentation on Ava's potential alignment with Air District Rule 9-4-9-6 and related clean air standards.

12. Adjourn
Chair Andersen announced that the next Ava Board of Directors meeting will be held on Wednesday, June 17, 2026 at 6:00 PM. The meeting was adjourned at 8:56 PM.

Consent Item 8
Consent Item 8
To: Ava Community Energy Authority
From: Howard Chang, Chief Executive Officer
Subject: Contracts Entered Into
Date: June 17, 2026
_____________________________________________________________________

RECOMMENDATION
Accept the CEO’s report on contracts that Ava Community Energy has entered into, as required by the Administrative Procurement Policy, from May 15, 2026 through June 11, 2026.

Consent Item 8
Counterparty
Name
Document Title Record Type Contract Purpose Contract Value Not To Exceed Expiration Date
City State Ironclad
Id
Chapman
and Cutler
LLP
June 2026
Amendment
to the
Consulting
Services
Agreement
Consulting
Services
Agreement
Contract
Purpose:

Consultant will
perform legal
services on
behalf of Ava
relating to a
renewable
energy
prepayment
transaction.;
Amendment
Purpose: Extend
the contract by
one year
$0.00 N/A 2027-06-
30 New York New
York
IC-2938
Chargeonomi
cs, LLC
May 2026
Purchase Rider
Purchase
Rider
Purchase
consulting
services for Ava
Charge market
benchmarking
analysis.
$4,999.00 $4,999.00 2027-06-
01 Danville Califor
nia
IC-2846
Consent Item 8
Counterparty
Name
Document Title Record Type Contract Purpose Contract Value Not To Exceed Expiration Date
City State Ironclad
Id
DataEndure Quote
#DATQ25614
Vendor
Purchase
Template
Consulting
services related
to
authentication
changes
required for
Salesforce
(specifically
change of ID
provider and
addition of
phishing
resistant MFA)
$4,500.00 $4,500.00 2027-06-
05 Santa Clara Califor
nia
IC-2939
Energy
Toolbase
Software,
Inc.

ENERGY

TOOLBASE

TERMS &

CONDITIONS -

MONITOR
Vendor
Purchase
Template
Provide solar
and energy
storage
monitoring
services for the
Critical
Municipal
Facilities
projects.
$35,000.00 N/A 2027-05-
20 Stuart Florid
a
IC-2888
Consent Item 8
Counterparty
Name
Document Title Record Type Contract Purpose Contract Value Not To Exceed Expiration Date
City State Ironclad
Id
GB
Endeavors
LLC
May 2026
Amendment
to the
Consulting
Services
Agreement
Consulting
Services
Agreement
Contract
Purpose:

Provide CEO
executive
coaching
services;
Amendment
Purpose: Extend
executive
coaching
agreement by
one year.
$10,000.00 $35,000.00 2027-06-
30 Oceanside Califor
nia
IC-2838

PEN-CAL
Administrato
rs, Inc.

May 2026
Amendment
to the PEN-CAL Services
Agreement
Vendor
Purchase
Template
Contract
Purpose:

Provide services
in connection
with Ava’s
nonqualified
deferred
compensation
plans;
Amendment
Purpose: Adding
the 457f plan to
the 415m plan
service
agreements
$0.00 N/A Livermore Califor
nia
IC-2869
Consent Item 9
Consent Item 9
To: Ava Community Energy Authority
From: Amy Vallandigham, Director of Accounting & Controller Subject: Fiscal Year 2025-2026 Q3 Financial Statements
Date: June 17, 2026
__________________________________________________________________ Summary/Recommendation
This memo updates the Board on Ava’s financial position as of March 31, 2026.

Financial Impact
This is an informational item.

Analysis and Context
Ava’s current fiscal year (FY) runs from July 1, 2025, through June 30, 2026. Financial position statements are generated every quarter and are audited annually by a third party. The financial statements presented today represent Ava’s financial position and activity for the quarter-ending March 31, 2026, and the FY to date. These statements are prepared by Ava’s accountant, Maher Accountancy.

Committee Recommendation
The Finance Administrative and Procurement Committee has reviewed these statements without comment.

Attachments
A. Fiscal year 2025-2026 Q3 Financial Statements.
1 ACCOUNTANTS’ COMPILATION REPORT
Board of Directors
Ava Community Energy Authority
Management is responsible for the accompanying financial statements of Ava Community Energy Authority (a California Joint Powers Authority) which comprise the statement of net position as of March 31, 2026, and the related statements of revenues, expenses, and changes in net position, and the statement of cash flows for the year to date and three months then ended in accordance with accounting principles generally accepted in the United States of America. We have performed a compilation engagement in accordance with Statements on Standards for Accounting and Review Services promulgated by the Accounting and Review Services Committee of the AICPA. We did not audit or review the accompanying statements nor were we required to perform any procedures to verify the accuracy or completeness of the information provided by management. Accordingly, we do not express an opinion, conclusion, nor provide any assurance on these financial statements.

Management has elected to omit substantially all of the note disclosures required by accounting principles generally accepted in the United States of America in these interim financial statements.

Ava Community Energy’s annual audited financial statements include the note disclosures omitted from these interim statements. If the omitted disclosures were included in these financial statements, they might influence the user’s conclusions about the Authority’s financial position, results of operations, and cash flows. Accordingly, these financial statements are not designed for those who are not informed about such matters.

We are not independent with respect to the Ava Community Energy Authority because we performed certain accounting services that impaired our independence.

Maher Accountancy
San Rafael, CA
May 11, 2026
1101 Fifth Avenue, Suite 200 San Rafael, CA 94901 415 459 1249 mahercpa.com Attachment Consent Item 9A
Current assets
Cash and cash equivalents - unrestricted $ 503,347,016
Cash and cash equivalents - restricted 2,543,836
Accounts receivable, net of allowance 66,065,091
Accrued revenue 23,967,367
Other receivables 8,483,581
Prepaid expenses 5,896,907
Investments 17,852,415
Total current assets 628,156,213
Noncurrent assets
Deposits 992,749
Investments 329,563,117
Loans receivable 2,629,221
Capital assets, net of depreciation and amortization 23,395,196 Total noncurrent assets 356,580,283
Total assets 984,736,496
Current liabilities
Accrued cost of electricity 113,243,613
Accounts payable 4,760,109
Advances from grantors 2,543,836
Other accrued liabilities 2,685,137
User taxes and energy surcharges due to other governments 8,481,515 Lease liability 445,735
Security deposits - energy suppliers 4,183,100
Total current liabilities 136,343,045
Noncurrent liabilities
Lease liability 11,590,429
Total noncurrent liabilities 11,590,429
Total liabilities 147,933,474
Rate Stabilization Fund 188,014,795
Net investment in capital assets 10,460,782
Unrestricted 638,327,445
Total net position $ 648,788,227

NET POSITION

AVA COMMUNITY ENERGY AUTHORITY

STATEMENT OF NET POSITION
As of March 31, 2026
ASSETS

LIABILITIES

DEFERRED INFLOWS OF RESOURCES
See accountants' compilation report. 2
Attachment Consent Item 9A
Three Months Year-to-Date

OPERATING REVENUES
Electricity sales, net 149,431,243$ $ 737,308,746
Grant revenue 107,344 1,168,639
Other operating revenues 2,064,182 3,952,009
Total operating revenues 151,602,769 742,429,394

OPERATING EXPENSES
Cost of electricity 180,940,821 616,094,809
Contract services 5,714,840 17,101,843
Staff compensation 6,708,614 18,587,665
Other operating expenses 4,502,221 11,960,464
Depreciation and amortization 274,366 814,871
Total operating expenses 198,140,862 664,559,652
Operating income (loss) (46,538,093) 77,869,742

NONOPERATING REVENUES (EXPENSES)
Investment income 4,544,443 17,738,138
Interest expense (236,140) (717,519)
Nonoperating revenues (expenses), net 4,308,303 17,020,619 CHANGE IN NET POSITION (42,229,790) 94,890,361
Net position at beginning of period 691,018,017 553,897,866 Net position at end of period $ 648,788,227 $ 648,788,227

AVA COMMUNITY ENERGY AUTHORITY
Nine Months Ended March 31, 2026

AND CHANGE IN NET POSITION

STATEMENT OF REVENUES, EXPENSES
See accountants' compilation report. 3
Attachment Consent Item 9A
Three Months Year-to-Date

CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers 233,005,708$ 851,328,437 $
Receipts from grantors 21,238 382,488
Receipts from wholesale sales and other operating receipts 6,792,474 13,439,918 Receipts of supplier security deposits 31,044,287 -
Payments to suppliers for electricity (188,306,195) (655,099,256) Payments for other goods and services (8,625,690) (30,489,769) Payments for staff compensation (6,963,572) (18,400,115) Payments of deposits and collateral (29,840,748) -
Payments of taxes and surcharges to other governments (12,595,254) (31,812,032) Net cash provided by operating activities 23,328,709 130,553,210

CASH FLOWS FROM CAPITAL AND RELATED

FINANCING ACTIVITIES
Lease payments (335,632) (559,387)
Purchases of capital assets (439,724) (2,008,064)
Net cash used by capital and related financing activities (775,356) (2,567,451)

CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sales and maturities of investments 111,797,543 174,633,636 Investment income received 7,724,521 12,742,757
Loan principal received 16,415 25,342
Purchase of investments (116,826,128) (187,240,564)
Loan issued - (750,000)
Net cash provided (used) by investing activities 2,712,351 (588,829) Net change in cash and cash equivalents 25,265,704 127,396,930 Cash and cash equivalents at beginning of period 480,625,148 378,493,922 Cash and cash equivalents at end of period $ 505,890,852 $ 505,890,852 Reconciliation to the Statement of Net Position
Cash and cash equivalents - unrestricted 503,347,016$ 503,347,016 $ Cash and cash equivalents - restricted 2,543,836 2,543,836 Cash and cash equivalents $ 505,890,852 $ 505,890,852
Nine Months Ended March 31, 2026

STATEMENT OF CASH FLOWS

AVA COMMUNITY ENERGY AUTHORITY
See accountants' compilation report. 4
Attachment Consent Item 9A

RECONCILIATION OF OPERATING INCOME TO NET

CASH PROVIDED (USED) BY OPERATING ACTIVITIES
Three Months Year-to-Date
Operating income (loss) (46,538,093)$ $ 77,869,742
Adjustments to reconcile operating income to net
cash provided (used) by operating activities
Depreciation and amortization expense 274,366 814,871
(Increase) decrease in:

Accounts receivable 45,853,336 26,581,710
Other receivables 1,577,651 (1,713,583)
Accrued revenue 30,034,540 37,209,891
Prepaid expenses 889,962 (696,052)
Deposits 95,706 (29,575,969)
Increase (decrease) in:

Accrued cost of electricity (2,982,007) (24,570,779)
Accounts payable (20,882) (2,206,100)
Other accrued liabilities (179,923) 117,479
Advances from grantors (86,107) (1,147,401)
Deferred revenue (517,914) 227,627
User taxes due to other governments (4,899,396) 26,277
Security deposits from energy suppliers (172,530) 29,225,717 Rate Stabilization Fund 18,389,780 -
Net cash provided (used) by operating activities $ 23,328,709 $ 130,553,210

NONCASH INVESTING ACTIVITIES
Change in fair value of investments $ (3,240,852) $ 5,163,669 Change in interest receivable $ 60,774 $ (168,288)

NONCASH CAPITAL FINANCING ACTIVITIES
Capital acquisitions included in accounts payable and other liabilities $ 681,213 $ 898,250 Nine Months Ended March 31, 2026
STATEMENT OF CASH FLOWS (Continued)

AVA COMMUNITY ENERGY AUTHORITY
See accountants' compilation report. 5
Attachment Consent Item 9A
Consent Item 10
Consent Item 10
To: Ava Community Energy Authority
From: Rusty Mills, Senior Vice President and Chief Financial Officer Subject:

Approval of Financial Services Agreement for energy prepayment financing transactions over the next 12 months
Date: June 17, 2026
__________________________________________________________________ Summary/Recommendation
Adopt a Resolution authorizing the execution and delivery of a Financial Services Agreement with PFM Financial Advisors LLC, (“PFM”), as Ava’s Municipal Financial Advisor, to support Ava’s energy prepay financing activity through June of 2027.

Background and Discussion
Energy prepayment financings are unique financing structures that provide a mechanism under which tax-exempt entities that sell power to end-use customers can reduce their cost of power by realizing energy savings on their long-term contracts. These are complex transactions with several entities. At a minimum, an energy project participant (e.g. Ava), a commodity supplier, a conduit bond issuer (e.g. CCCFA), and a third-party trustee and custodian are involved.

Ava has executed five prepay transactions, including the first ever Community Choice Aggregation (CCA) prepay in 2021, and then subsequent transactions in 2022, 2023, and 2025.

Many of the CCA’s in California have utilized this structure to provide discounted power and further enable a value proposition for CCA customers. The bonds have been sold through the California Community Choice Financing Authority (CCCFA) as a conduit issuer, which was initially set up to enable these transactions.

Consent Item 10
Ava and its customers benefit from tax-exempt municipal bonds, which allow the energy supplier to secure funding at a lower cost than available in taxable markets or through internal capital. The project participant (e.g. Ava) commits to buying a commodity over a 30-year period and receives a discount on its contracted price throughout the term, lowering current and future energy costs. The commodity supplier often enters a separate funding agreement with a creditworthy third-party funding recipient, who receives a lower cost of funding benefit from the issuance and commits to make fixed payments that ultimately support the debt service of the underlying bonds.

In each of the 5 previous energy prepay financings, Ava has engaged PFM to support Ava in the following aspects of the transaction:
• Project management of prepay bond financing process
• Documentation and Planning
• Financial Planning and Modeling
• Certain prepay structure transaction execution support In each of these financings, as is anticipated in upcoming financings, PFM’s fees are paid out of proceeds from the transaction.

Authorization
The details of the requested board approval are as follows: Adopt the Resolution which authorizes Ava to negotiate and execute the Financial Services Agreement with PFM that will authorize Ava to utilize the financial advisory services of PFM for up to three prepay transactions through 6/30/2027, with fees capped at $250,000 per transaction. The maximum fees under this agreement will be $750,000, if three prepays are completed.

Financial Impact
The purpose of pursuing the prepay transaction is to achieve meaningful energy procurement cost savings. These transactions are targeting an 8-12% discount at the outset, which translates to approximately $4-6 million of annual savings. Ava has saved $34.3 million from 2022 through December 2025 on the energy purchased through the five prepays it has closed, and savings are now expected to average $22.5 million annually for the next 5 years. With the addition of prepays 6 and 7, savings will be expected to rise to approximately $30-35 million annually on energy purchased through the Power Supply Contracts during the next five years.

Most of the parties assisting Ava with the prepay will be paid from the proceeds of the prepay bonds, including PFM. Each prepay will have services capped at $250,000 from PFM. Fees will only be paid when bonds are issued, and Ava is under no obligation to complete all three transactions. Certain fees, such as rating agency fees and green bond designation fees, are not contingent on a successful prepay transaction closing. Ava negotiated to have the prepay Consent Item 10
supplier(s) split these costs with Ava if the deal does not close. To minimize this modest risk, Ava will only authorize these fees when necessary.

Additionally, it is important to note that the prepay transaction itself is non-recourse to Ava. 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 CCCFA will not constitute debts, liabilities or obligations of Ava or any representative of Ava serving on the governing body of Ava.

Attachments
A. Resolution
B. Financial Services Agreement with PFM Financial Advisors LLC Attachment Consent Item 10A
RESOLUTION NO. R-202x-XX

A RESOLUTION OF THE BOARD OF DIRECTORS

OF AVA COMMUNITY ENERGY AUTHORITY AUTHORIZING THE EXECUTION AND

DELIVERY OF A FINANCIAL SERVICES AGREEMENT WITH PFM FINANCIAL ADVISORS LLC, AS MUNICIPAL FINANCIAL ADVISOR, TO SUPPORT AVA’S ENERGY PREPAY FINANCING ACTIVITY THROUGH JUNE OF 2027.

WHEREAS Ava Community Energy Authority (“Ava”) 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 Ava and parties to the Joint Powers Agreement (“JPA”) in March of 2020. The city of Stockton was added as a member to Ava in September of 2022. The city of Lathrop was added as a member to Ava in October of 2023. San Joaquin County was added as a member to Ava in July 2024. On October 24, 2023, Ava legally adopted the name Ava Community Energy Authority, where it had previously used the name East Bay Community Energy Authority since its inception.

WHEREAS pursuant to the provisions of the Act, Ava 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 Ava 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 Ava has determined that it is desirable to acquire long-term supplies of clean energy from the Issuer;
WHEREAS Ava is requesting that the Issuer agree to enter into one or two transactions to (i) purchase certain quantities of clean energy from a Delaware limited liability company (the “Prepaid Supplier”) the sole member of which is Morgan Stanley Capital Group Inc., a Delaware corporation (“MSCG”) on a prepaid basis and to sell such clean energy to Ava, as described herein (the “MS Project”) and/or (ii) purchase certain quantities of clean energy from a Delaware limited liability company, the sole equity member of which is J. Aron & Company LLC, a New York limited liability Attachment Consent Item 10A
company (the “Electricity Supplier”) on a prepaid basis and to sell such clean energy to Ava, as described herein (the “GS Project” and together with the MS Project, the “Projects”);
WHEREAS Ava has determined to authorize a total of two transactions, consisting of one MS Project and one GS Project or, in the alternative two MS Projects or two GS Projects;
WHEREAS Ava is requesting that the Issuer finance the costs of the Projects with the proceeds of two separate series of its Clean Energy Project Revenue Bonds, Series 2026 (together, the “Bonds”);
WHEREAS Ava has determined to authorize the officers of Ava 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 Ava for approval forms of the following agreement to which Ava is a party: Financial Services Agreement.

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

Section 1. The proposed form of the Ava Document, as made available to the Board of Directors for this meeting, is hereby approved. Any of the Chief Executive Officer, Chief Financial Officer or Chair of the Board (each an “Authorized Officer”) is hereby authorized and directed, for and on behalf of Ava, to execute and deliver the Ava 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 agreement will expire on June 30th of 2027 and provides the following services to Ava for energy prepay financings: project management; documentation and planning; and financial planning and modelling. The fees for these services shall only be payable from financing proceeds.

Section 3 The not-to-exceed is $750,000 over the term or $250,000 per financing.

ADOPTED AND APPROVED this 17th day of June 2027.

Betsy Andersen, Chair
Attachment Consent Item 10A
ATTEST:

Adrian Bankhead, Clerk of the Board

FINANCIAL SERVICES AGREEMENT
THIS AGREEMENT (“Agreement”), is made as of the date of the last signature affixed hereto (“Effective Date”), by and between the AVA COMMUNITY ENERGY AUTHORITY, a joint powers authority (“Ava”) and PFM FINANCIAL ADVISORS LLC, a Delaware Limited Liability Company whose address is 222 N. Pacific Coast Hwy., 10th Floor El Segundo, CA 90245 (“PFMFA”), together with its affiliate, PFM Swap Advisors LLC whose address is 1735 Market Street, 42nd Floor, Philadelphia PA 19103 (“PFM Affiliate” or “PFMSA”). The parties shall be collectively referred to as the “Parties” and each individually as a “Party”).

PFMFA and PFM Affiliate shall both be bound to the terms and conditions of this Agreement; provided, however, that each will provide its services pursuant to a separate scope of work (“Scope of Work”), included in Exhibit “A” to this Agreement. Collectively, PFMFA and PFM Affiliate shall be referred to throughout this Agreement as “Consultant”.

RECITALS:

A. Ava is an independent public agency duly organized under the provisions of the Joint Exercise of Powers Act of the State of California (Government Code Section 6500 et seq.) (“Act”) with the power to conduct its business and enter into agreements.

B. Consultant possesses the skill, experience, ability, background, certification and knowledge to provide the services described in this Agreement pursuant to the terms and conditions described herein.

C. Ava and Consultant desire to enter into an agreement for Municipal Advisor and Swap Advisor services with Consultant upon the terms and conditions herein in connection with the proposed issuance of bonds by California Community Choice Financing Authority, a conduit joint powers authority (“Issuer”) selected by Ava to issue bonds (the “Bonds”) as part of a prepayment transaction for the purchase of electricity.

NOW, THEREFORE, the Parties mutually agree as follows:

1. TERM
The term of this Agreement shall commence on the Effective Date, and shall terminate on June 30, 2027, unless terminated earlier as set forth herein.

Attachment Consent Item 10B

2. SERVICES TO BE PERFORMED
Consultant shall perform each and every service set forth in Exhibit "A" pursuant to the schedule of performance set forth in Exhibit "B," both of which are attached hereto and incorporated herein by this reference. Upon request of Ava, Consultant or an affiliate of Consultant or a third party referred or otherwise introduced by Consultant, may agree to additional services to be provided by Consultant or an affiliate of Consultant or third party, by a separate writing, including separate scope and compensation, between Ava and Consultant or its respective affiliate or third party. For the sake of clarity, any separate agreement between Ava and an affiliate of Consultant or third party shall not in any way be deemed an amendment or modification of this Agreement.

3. COMPENSATION TO CONSULTANT
Consultant shall be compensated for services performed pursuant to this Agreement in a total amount not to exceed Seven Hundred and Fifty Thousand and 00/100 dollars ($750,000) based on the rates and terms set forth in Exhibit "C," which is attached hereto and incorporated herein by this reference.

4. TIME IS OF THE ESSENCE
Consultant and Ava agree that time is of the essence regarding the performance of this Agreement.

5. STANDARD OF CARE
Consultant agrees to perform all services required by this Agreement in a manner commensurate with the prevailing standards of specially trained professionals in the San Francisco Bay Area under similar circumstances and in a manner reasonably satisfactory to Ava and agrees that all services shall be performed by qualified and experienced personnel. Consultant shall be responsible to Ava for any errors or omissions in the performance of work pursuant to this Agreement. Should any errors caused by Consultant be found in such services or products, Consultant shall correct the errors at no additional charge to Ava by redoing the professional work and/or revising the work product(s) called for in the Scope of Services to eliminate the errors.

Should Consultant fail to make such correction in a reasonably timely manner, such correction may be made by Ava, and the cost thereof shall be charged to Consultant. In addition to all other available remedies, Ava may withhold payment otherwise owed Consultant under this Agreement up to the amount of the cost of correction.

6. INDEPENDENT PARTIES
Ava and Consultant intend that the relationship between them created by this Agreement is that of independent contractor. The manner and means of conducting the work are under the control of Consultant, except to the extent they are limited by statute, rule or regulation and the express terms of this Agreement. No civil service status or other right of employment will be acquired by virtue of Consultant's services. None of the benefits provided by Ava to its employees, including but not limited to, unemployment insurance, workers’ compensation Attachment Consent Item 10B
plans, vacation and sick leave are available from Ava to Consultant, its employees or agents.

Deductions shall not be made for any state or federal taxes, FICA payments, PERS payments, or other purposes normally associated with an employer-employee relationship from any fees due Consultant. Payments of the above items, if required, are the responsibility of Consultant.

Consultant shall indemnify and hold harmless Ava and its elected officials, officers, employees, servants, designated volunteers, and agents serving as independent contractors in the role of Ava officials, from any and all liability, damages, claims, costs and expenses of any nature to the extent arising from Consultant’s personnel practices. Ava shall have the right to offset against the amount of any fees due to Consultant under this Agreement any amount due to Ava from Consultant as a result of Consultant’s failure to promptly pay to Ava any reimbursement or indemnification arising under this section.

7. NO RECOURSE AGAINST CONSTITUENT MEMBERS OF Ava
Ava is organized as Joint Powers Authorities in accordance with the Joint Powers Act of the State of California (Government Code Section 6500 et seq.) pursuant to Joint Powers Agreement dated December 1, 2016, and is a public entity separate from its constituent members.

Ava shall solely be responsible for all debts, obligations and liabilities accruing and arising out of this Agreement. Consultant shall have no rights and shall not make any claims, take any actions or assert any remedies against any of Ava’s constituent members in connection with this Agreement.

8. NON-DISCRIMINATION
In the performance of this Agreement, Consultant shall not discriminate against any employee, subcontractor or applicant for employment because of race, color, religious creed, sex, gender, gender identity, gender expression, marital status, national origin, ancestry, age, physical disability, mental disability, medical condition, genetic information, sexual orientation or other basis prohibited by law.

9. HOLD HARMLESS AND INDEMNIFICATION
General Indemnification. To the fullest extent permitted by law, Consultant shall, at its sole cost and expense, defend, hold harmless and indemnify Ava and their elected officials, officers, attorneys, agents, employees, designated volunteers, successors, assigns and agents serving as independent contractors in the role of Ava officials (collectively “Indemnitees”), from and against any and all damages, costs, expenses, liabilities, claims, demands, causes of action, proceedings, expenses, judgments, penalties, liens, and losses of any nature whatsoever, including fees of accountants, attorneys, or other professionals and all costs associated therewith (collectively “Liabilities”), in law or equity, whether actual, alleged or threatened, which arise out of, are claimed to arise out of, pertain to, or relate to the negligence or willful misconduct of Consultant, its officers, agents, servants, employees, subcontractors, materialmen, consultants or their officers, agents, servants or employees (or any entity or individual that Consultant shall bear the legal liability thereof) in the performance of this Agreement, including the Indemnitees’ active or passive negligence, but only to the extent of Consultant’s liability, except for Liabilities arising from the sole negligence or willful misconduct of the Indemnitees as determined by court decision or by the agreement of the Parties. Consultant shall defend the Indemnitees in any action or actions filed in connection with any Liabilities with counsel of the Indemnitees’ choice, and shall pay all costs and expenses, including all attorneys’ fees and experts’ costs actually incurred in connection with such defense. Consultant shall reimburse the Indemnitees for any and all legal expenses and costs incurred by Indemnitees in connection therewith.

Attachment Consent Item 10B
Consultant’s indemnifications and obligations under this section shall survive the expiration or termination of this Agreement.

10. INSURANCE
A. General Requirements. On or before the commencement of the term of this Agreement, Consultant shall furnish Ava with certificates showing the type, amount, class of operations covered, effective dates and dates of expiration of insurance coverage in compliance with the requirements listed in Exhibit "D," which is attached hereto and incorporated herein by this reference. Such insurance and certificates, which do not limit Consultant’s indemnification obligations under this Agreement, shall also contain substantially the following statement: "Should any of the above insurance covered by this certificate be canceled or coverage reduced before the expiration date thereof, the insurer affording coverage shall provide thirty (30) days’ advance written notice to Ava by certified mail, Attention: Chief Executive Officer." Consultant shall maintain in force at all times during the performance of this Agreement all appropriate coverage of insurance required by this Agreement with an insurance company that is acceptable to Ava and licensed to do insurance business in the State of California. Endorsements naming Ava as additional insured shall be submitted with the insurance certificates.

B. Subrogation Waiver. Consultant agrees that in the event of loss due to any of the perils for which he/she has agreed to provide comprehensive general and automotive liability insurance, Consultant shall look solely to its insurance for recovery. Consultant hereby grants to Ava, on behalf of any insurer providing comprehensive general and automotive liability insurance to either Consultant or Ava with respect to the services of Consultant herein, a waiver of any right to subrogation which any such insurer of Consultant may acquire against Ava by virtue of the payment of any loss under such insurance.

C. Failure to Secure or Maintain Insurance. If Consultant at any time during the term hereof should fail to secure or maintain the foregoing insurance, Ava shall be permitted to obtain such insurance in the Consultant's name or as an agent of the Consultant and shall be compensated by the Consultant for the costs of the insurance premiums at the maximum rate permitted by law and computed from the date written notice is received that the premiums have not been paid.

D. Additional Insured. Ava, and its members, officers, employees and volunteers shall be named as additional insureds under all insurance coverages, except any professional liability insurance, required by this Agreement. The naming of an additional insured shall not affect any recovery to which such additional insured would be entitled under this policy Attachment Consent Item 10B
if not named as such additional insured. An additional insured named herein shall not be held liable for any premium, deductible portion of any loss, or expense of any nature on this policy or any extension thereof. Any other insurance held by an additional insured shall not be required to contribute anything toward any loss or expense covered by the insurance provided by this policy.

E. Sufficiency of Insurance. The insurance limits required by Ava are not represented as being sufficient to protect Consultant. Consultant is advised to confer with Consultant's insurance broker to determine adequate coverage for Consultant.

F. Maximum Coverage and Limits. It shall be a requirement under this Agreement that any available insurance proceeds broader than or in excess of the specified minimum Insurance coverage requirements and/or limits shall be available to the additional insureds. Furthermore, the requirements for coverage and limits shall be the minimum coverage and limits specified in this Agreement, or the broader coverage and maximum limits of coverage of any insurance policy or proceeds available to the named insured, whichever is greater.

11. CONFLICT OF INTEREST
Consultant warrants that it, and to its best knowledge, its officers, employees, associates and subcontractors, presently have no interest, and will not acquire any interest, direct orindirect, financial or otherwise, that would conflict in any way with the performance of this Agreement, and that it, its officers, employees, associates and subcontractors, will not employ any person having such an interest. Consultant and its officers, employees, associates and subcontractors, if any shall comply with all conflict of interest statutes of the State of California applicable to Consultant’s services under this Agreement, including the Political Reform Act (Gov. Code § 81000, et seq.) and Government Code Section 1090. During the term of this Agreement, Consultant may perform similar services for other clients. Consultant shall incorporate a clause substantially similar to this section into any subcontract that Consultant executes in connection with the performance of this Agreement. Consultant understands that it may be required to fill out a conflict of interest form if the services provided under this Agreement require Consultant to make certain governmental decisions or serve in a staff position, as defined in Title 2, Division 6, Section 18700 of the California Code of Regulations.

12. PROHIBITION AGAINST TRANSFERS
Consultant shall not assign, sublease, hypothecate, or transfer this Agreement, or any interest therein, directly or indirectly, by operation of law or otherwise, without prior written consent of Ava. Any attempt to do so withoutsuch consentshall be null and void, and any assignee, sublessee, pledgee, or transferee shall acquire no right or interest by reason of such attempted assignment, hypothecation or transfer. However, claims for money by Consultant from Ava under this Agreement may be assigned to a bank, trust company or other financial institution without prior written consent. Written notice of such assignment shall be promptly furnished to Ava by Consultant.

The sale, assignment, transfer or other disposition of any of the issued and outstanding capital stock of Consultant, or of the interest of any general partner or joint venturer or syndicate Attachment Consent Item 10B
member or cotenant, if Consultant is a partnership or joint venture orsyndicate or co-tenancy, which shall result in changing the control of Consultant, shall be construed as an assignment of this Agreement. Control means fifty percent (50%) or more of the voting power of the corporation.

13. SUBCONTRACTOR APPROVAL
Unless prior written consent from Ava is obtained, only those persons and subcontractors whose names are attached to this Agreement shall be used in the performance of this Agreement.

In the event that Consultant employs subcontractors, such subcontractors shall berequired to furnish proof of workers’ compensation insurance and shall also be required to carry general, automobile and professional liability insurance in substantial conformity to the insurance carried by Consultant. In addition, any work or services subcontracted hereunder shall be subject to each provision of this Agreement.

Consultant agrees to include within their subcontract(s) with any and all subcontractors the same requirements and provisions of this Agreement, including the indemnity and insurance requirements, to the extent they apply to the scope of the subcontractor’s work. Subcontractors hired by Consultant shall agree to be bound to Consultant and Ava in the same manner and to the same extent as Consultant is bound to Ava under this Agreement. Subcontractors shall agree to include these same provisions within any sub-subcontract. Consultant shall provide a copy of the Indemnity and Insurance provisions of this Agreement to any subcontractor. Consultant shall require all subcontractors to provide valid certificates of insurance and the required endorsements prior to commencement of any work and will provide proof of compliance to Ava.

14. REPORTS
A. Each and every report, draft, work product, map, record and other document, hereinafter collectively referred to as "Report", reproduced, prepared or caused to be prepared by Consultant pursuant to or in connection with this Agreement, shall be the exclusive property of Ava. Consultant shall not copyright any Report required by this Agreement and shall execute appropriate documents to assign to Ava the copyright to Reports created pursuant to this Agreement. Any Report, information and data acquired orrequired by this Agreementshall become the property of Ava, and all publication rights are reserved to Ava. Consultant may retain a copy of any Report furnished to Ava pursuant to this Agreement.

B. All Reports prepared by Consultant may be used by Ava in execution or implementation of: (1) The original project for which Consultant was hired; (2) Completion of the original project by others; (3) Subsequent additions to the original project; and/or (4) Other Ava projects as Ava deems appropriate in its sole discretion.

C. Consultant shall, at such time and in such form as Ava may require, furnish reports concerning the status of services required under this Agreement.

Attachment Consent Item 10B
D. All Reports shall also be provided in electronic format, both in the original file format (e.g., Microsoft Word) and in PDF format.

E. No Report, information or other data given to or prepared or assembled by Consultant pursuant to this Agreement that has not been publicly released shall be made available to any individual or organization by Consultant without prior approval by Ava.

F. Ava shall be the owner of and shall be entitled upon request to immediate possession of accurate reproducible copies of Reports or other pertinent data and information gathered or computed by Consultant prior to termination of this Agreement or upon completion of the work pursuant to this Agreement.

15. RECORDS
Consultant shall maintain complete and accurate records with respect to costs, expenses, receipts and other such information required by Ava that relate to the performance of services under this Agreement, in sufficient detail to permit an evaluation of the services and costs. All such records shall be clearly identified and readily accessible. Consultant shall provide free accessto such books and records to the representatives of Ava or its designees at all proper times, and gives Ava the right to examine and audit same, and to make transcripts therefrom as necessary, and to allow inspection of all work, data, documents, proceedings and activities related to this Agreement. Such records, together with supporting documents, shall be maintained for a minimum period of five (5) years after Consultant receives final payment from Ava for all services required under this Agreement.

16. PARTY REPRESENTATIVES
The Chief Executive Officer of Ava (“Ava Representative”) shall represent Ava in all matters pertaining to the services to be performed under this Agreement. Michael Berwanger, Managing Director, PFM Financial Advisors LLC and [George Hu, Senior Managing Consultant], PFM Swap Advisors LLC (“Consultant Representatives”) shall represent Consultant in all matters pertaining to the services to be performed under this Agreement.

17. INFORMATION AND DOCUMENTS
A. Consultant covenants that all data, reports, documents, discussion, or other information (collectively “Data”) developed or received by Consultant or provided for performance of this Agreement are deemed confidential and shall not be disclosed or released by Consultant without prior written authorization by Ava, unless disclosure is required by law or judicial or regulatory process. Consultant, its officers, employees, agents, or subcontractors shall not without written authorization from Ava Representative or unless requested in writing by Ava Attorney, voluntarily provide declarations, letters of support, testimony at depositions, response to interrogatories or other information concerning the work performed under this Agreement or relating to any project or property located within Ava. Response to a subpoena or court order shall not be considered “voluntary,” provided, to the extent not legally prohibited, Attachment Consent Item 10B
Consultant gives Ava notice of such court order or subpoena.

B. To the extent not legally prohibited, Consultant shall promptly notify Ava should Consultant, its officers, employees, agents or subcontractors be served with any summons, complaint, subpoena, notice of deposition, request for documents, interrogatories, request for admissions or other discovery request, court order or subpoena from any party regarding this Agreement and the work performed thereunder or with respect to any project or property located within Ava. Ava may, but has no obligation to, represent Consultant or be present at any deposition, hearing or similar proceeding. Consultant agrees to reasonably cooperate with Ava and to provide Ava with the opportunity to review any response to discovery requests provided by Consultant. However, Ava’s right to review any such response does not imply or mean the right by Ava to control, direct or rewrite the response.

C. In the event Ava gives Consultant written notice of a “litigation hold”, then as to all data identified in such notice, Consultant shall, at no additional cost to Ava, isolate and preserve all such data pending receipt of further direction from Ava.

D. Consultant agrees to comply with the confidentiality provisions set forth in Exhibit “E,” attached hereto and incorporated herein by this reference.

E. Consultant’s covenants under this section shall survive the expiration or termination of this Agreement.

18. NOTICES
Any notice, consent, request, demand, bill, invoice, report or other communication required or permitted under this Agreement shall be in writing and conclusively deemed effective:
(a) on personal delivery, (b) on confirmed delivery by courier service during Consultant’s and Ava’s regular business hours, or (c) three Business Days after deposit in the United States mail, by first class mail, postage prepaid, and addressed to the Party to be notified as set forth below:

TO AVA
1999 Harrison Street, Suite 2300
Oakland, CA 94612
Attention: Chief Executive Officer
TO CONSULTANT:

PFM Financial Advisors LLC
222 N. Pacific Coast Hwy., 10th Floor
El Segundo, CA 90245Attn: Managing
Director

19. TERMINATION
Attachment Consent Item 10B
In the event Consultant fails or refuses to perform any of the provisions hereof at the time and in the manner required hereunder, Consultant shall be deemed in default in the performance of this Agreement. If Consultant fails to cure the default within the time specified (which shall be not less than 10 days) and according to the requirements set forth in Ava’s written notice of default, and in addition to any other remedy available to Ava by law, Ava Representative may terminate the Agreement by giving Consultant written notice thereof, which shall be effective immediately. Ava Representative shall also have the option, at its sole discretion and without cause, of terminating this Agreement by giving seven (7) calendar days' prior written notice to Consultant as provided herein. Upon receipt of any notice of termination, Consultant shall immediately discontinue performance.

In the event of Ava’s termination of this Agreement due to no fault or failure of performance by Consultant, and subject to the ultimate issuance of the Bonds, Consultant shall be paid for services satisfactorily performed up to the effective date of termination solely from the Bond proceeds. Upon termination, Consultant shall immediately deliver to Ava any and all copies of studies, computations, and other material or products, whether or not completed, prepared by Consultant or given to Consultant, in connection with this Agreement. Such materials shall become the property of Ava. Consultant shall have no other claim against Ava by reason of such termination, including any claim for compensation.

20. COMPLIANCE WITH LAWS
Consultant shall keep itself informed of all applicable federal, state and local laws, ordinances, codes, regulations and requirements which may, in any manner, affect those employed by it or in any way affect the performance of its services pursuant to this Agreement.

Consultant shall, at all times, observe and comply with all such laws and regulations. Ava, and its officers and employees, shall not be liable at law or in equity by reason of the failure of the Consultant to comply with this paragraph.

Consultant represents and agrees that all personnel engaged by Consultant in performing services are and shall be fully qualified and are authorized or permitted under state and local law to perform such services. Consultant represents and warrants to Ava that it has all licenses, permits, certificates, qualifications, and approvals required by law to provide the services and work required to perform services under this Agreement, including a business license.

Consultant further represents and warrants that it shall keep in effect all such licenses, permits, and other approvals during the term of this Agreement.

21. CONFLICT OF LAW
This Agreement shall be interpreted under, and enforced by the laws of the State of California. The Agreement and obligations of the Parties are subject to all valid laws, orders, rules, and regulations of the authorities having jurisdiction over this Agreement (or the successors of those authorities). Any suits brought pursuant to this Agreement shall be filed with the Superior Court of the [County of Santa Clara], State of California.

22. ADVERTISEMENT
Attachment Consent Item 10B
Consultant shall not post, exhibit, display or allow to be posted, exhibited, displayed any signs, advertising, show bills, lithographs, posters or cards of any kind pertaining to the services performed under this Agreement unless prior written approval has been secured from Ava to do otherwise.

23. WAIVER
A waiver by Ava of any breach of any term, covenant, or condition contained herein shall not be deemed to be a waiver of any subsequent breach of the same or any other term, covenant, or condition contained herein, whether of the same or a different character.

24. INTEGRATED CONTRACT
This Agreement represents the full and complete understanding of every kind or nature whatsoever between the Parties, and all preliminary negotiations and agreements of whatsoever kind or nature are merged herein. No verbal agreement or implied covenant shall be held to vary the provisions hereof. Any modification of this Agreement will be effective only by a written document signed by both Ava and Consultant.

25. AUTHORITY
The individual(s) executing this Agreement represent and warrant that they have the legal authority to do so on behalf of their respective legal entities.

26. INSERTED PROVISIONS
Each provision and clause required by law to be inserted into the Agreement shall be deemed to be enacted herein, and the Agreement shall be read and enforced as though each were included herein. If through mistake or otherwise, any such provision is not inserted or is not correctly inserted, the Agreement shall be amended to make such insertion on application by either Party.

27. CAPTIONS AND TERMS
The captions in this Agreement are for convenience only, are not a part of the Agreement and in no way affect, limit or amplify the terms or provisions of this Agreement.

28. AVA’S RIGHTS TO EMPLOY OTHER CONSULTANTS
Ava reserves the right to employ other consultants in connection with the subject matter of the Scope of Services.

29. EXHIBITS
Attachment Consent Item 10B
The Exhibits referenced in this Agreement are attached hereto and incorporated herein by this reference asthough setforth in full in the Agreement. If any inconsistency exists or arises between a provision of this Agreement and a provision of any exhibit, or between a provision of this Agreement and a provision of Consultant’s proposal, the provisions of this Agreement shall control.

30. FORCE MAJEURE
Consultant shall not be liable for any failure to perform its obligations under this Agreement if Consultant presents acceptable evidence, in Ava’ssole judgment, thatsuch failure was due to acts of God, embargoes, inability to obtain labor or materials or reasonable substitutes for labor or materials, governmental restrictions, governmental regulations, governmental controls,judicial orders, enemy or hostile governmental action, civil commotion, fire or other casualty, or other causes beyond Consultant’s reasonable control and not due to any act by Consultant.

31. FINAL PAYMENT ACCEPTANCE CONSTITUTES RELEASE
The acceptance by Consultant of the final payment made under this Agreement shall operate as and be a release of Ava from all claims and liabilities for compensation to Consultant for anything done, furnished or relating to Consultant’s work or services. However, approval or payment by Ava shall not constitute, nor be deemed, a release of the responsibility and liability of Consultant, its employees, subcontractors and agents for the accuracy and competency of the information provided and/or work performed; nor shall such approval or payment be deemed to be an assumption of such responsibility or liability by Ava for any defect or error in the work prepared by Consultant, its employees, subcontractors and agents.

32. SEVERABILITY
If any provision in this Agreement is held by a court of competent jurisdiction to be illegal, invalid, void, or unenforceable, the remaining provisions will nevertheless continue in full force without being impaired or invalidated in any way.

33. SUCCESSORS AND ASSIGNS
The terms and conditions of this Agreement shall be binding on the successors and assigns of the Parties to this Agreement.

34. NO THIRD PARTY BENEFICIARIES INTENDED
This Agreement is made solely forthe benefit of the Partiesto this Agreement and their respective successors and assigns, and no other person or entity may have or acquire a right by virtue of this Agreement.

35. COUNTERPARTS; FACSIMILE/PDF/ELECTRONIC SIGNATURE
Attachment Consent Item 10B
This Agreement may be executed in multiple counterparts, all of which shall be deemed an original, and all of which will constitute one and the same instrument. The Parties agree that a facsimile, PDF or electronic signature may substitute for and have the same legal effect as the original signature.

36. DRAFTING PARTY
This Agreement shall be construed without regard to the Party that drafted it. Any ambiguity shall not be interpreted against either Party and shall, instead, be resolved in accordance with other applicable rules concerning the interpretation of contracts.

37. INFORMATION TO BE FURNISHED TO CONSULTANT
All information, data, reports, and records in the possession of Ava or any third party necessary for carrying out any services to be performed under this Agreement (“Data”) shall be furnished to Consultant. Consultant may rely on the Data in connection with its provision of the services under this Agreement and the provider thereof shall remain solely responsible for the adequacy, accuracy and completeness of such Data.

IN WITNESS WHEREOF, the Parties have caused the Agreement to be executed as of the date set forth above.

PFM FINANCIAL ADVISORS LLC
A Limited Liability Company
By: Name: Michael Berwanger
Title: Managing Director
Date: ________________________

PFM SWAP ADVISORS LLC
A Limited Liability Company
By: Name: George Hu
Title: Director
Date:_________________________________

AVA COMMUNITY ENERGY

AUTHORITY
A Joint Powers Authority
By:

Name: Howard Chang Title: Chief
Executive Officer
Date:__________________________________
Attachment Consent Item 10B
APPROVE AS TO FORM:
__________________________
Inder Khalsa, General Counsel
Attachment Consent Item 10B
Exhibit A
Consultant Work Orders
(See Following Pages)
Attachment Consent Item 10B
WORK ORDER #1

PFM FINANCIAL ADVISORS LLC
The terms and conditions of the Agreement between Ava, PFMFA and PFMSA are incorporated into this Scope of Services by reference.

Working with PFMSA, PFMFA will provide the following portion of the Scope of Services:

PFM Financial Advisors LLC (as Municipal Advisor)
Scope of Services Transaction Services
 PFM will take the lead role acting as Project Manager throughout the prepay bond financing process.
 Documentation and Planning
 Develop a financing plan in concert with Ava staff which would include recommendations as to the timing and number of series of bonds to be issued.  Review transaction legal documentation provide suggestions, modifications and enhancements where appropriate and assist with the negotiation of terms with associated counterparties.
 Coordinate with Ava staff and other advisors as respects the furnishing of data for offering documents, it being specifically understood that PFM is not responsible for the inclusion or omission of any material in published offering documents.  In coordination with the deal team, develop credit rating presentation and coordinate with Ava the overall presentation to rating agencies.  Assistance with putting together the necessary disclosure related to Ava (separately and together, if and where relevant) in the disclosure documents.  Arrange for the closing of the transaction including, but not limited, to bond printing, signing and final delivery of the bonds.
 Financial Planning and Modelling
 Advise as to the various financing alternatives available to Ava staff.  Develop alternatives related to debt transaction including evaluation of maturity schedule and cash flow requirements.
 Assist Ava in the procurement of ancillary services relating to debt issuance such as printing, trustee, paying agent, registrar, etc.
 Analyze financial and economic factors to determine if the issuance of prepayment bonds is appropriate.

Attachment Consent Item 10B
 Provide financial modeling services and comparables on deal pricing and deal economics.
 As applicable, advise Ava on the condition of the bond market at the time of sale, including volume, timing considerations, competing offerings, and general economic considerations.
 Assist and advise Ava in negotiations with investment banking groups regarding fees, pricing of the bonds and final terms of any security offering, and make recommendations regarding a proposed offering to obtain the most favorable financial terms based on existing market conditions.

FINANCIAL ADVISORY REQUIRED DISCLOSURES:

PFMFA is a registered municipal advisor with the Securities and Exchange Commission (the “SEC”) and the Municipal Securities Rulemaking Board (the “MSRB”), pursuant to the Securities Exchange Act of 1934 Rule 15Ba1-2. If Ava has designated PFMFA as its independent registered municipal advisor (“IRMA”) for purposes of SEC Rule 15Ba1-1(d)(3)(vi) (the “IRMA exemption”), then services provided pursuant to such designation shall be the services described in this Work Order #1, subject to any agreed upon limitations. Verification of independence (as is required under the IRMA exemption) shall be the responsibility of such third party seeking to rely on such IRMA exemption. PFMFA shall have the right to review and approve in advance any representation of its’s role as IRMA to Ava.

MSRB Rules require that municipal advisors make written disclosures to their clients of all material conflicts of interest, certain legal or disciplinary events and certain regulatory requirements. Such disclosures are provided in PFMFA’s Disclosure Statement delivered to Ava prior to or together with this Agreement.

Team Members:

Michael Berwanger, Managing Director
James Carbone, Senior Managing Consultant
Faisal Alif, Analyst
Other personnel to be assigned as necessary
Attachment Consent Item 10B
WORK ORDER #2

PFM SWAP ADVISORS LLC
The terms and conditions of the Agreement between Ava, PFMFA and PFMSA are incorporated into this Scope of Services by reference.

Working with PFMFA, PFMSA will provide the following portion of the Scope of Services:

PFM Swap Advisors LLC ( as Swap Advisor and QIR)
Scope of Services Transaction Services
 PFMSA will serve Ava as Municipal Advisor and designated Qualified Independent Representative (“QIR”) in the provision of general swap advisory services related to any swap-related communication, interaction or other discussion (“Swap Communication”) between Ava and Swap Dealers (as such term is defined by the Securities and Exchange Commission (“SEC”) and the Commodity Futures Trading Commission (“CFTC”)).

PFMSA is obligated to comply with the applicable requirements of CFTC Regulation 17 CFR 23.450(b)(1) in providing QIR services to Ava.
 As QIR to Ava, PFMSA will make available qualified professionals to participate in discussions and other interactions with Swap Dealers as Ava finds necessary or desirable.

Additionally, PFMSA will assist Ava with analysis of any proposals from Swap Dealers.

PFMSA may assist Ava with other swap related tasks such as helping write a swap policy or other related analysis upon Ava’s request. PFMSA will also assist Ava, as needed, in completing the ISDA Dodd-Frank Protocols and other matters to comply with the regulatory requirements imposed under Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
 Analyze and model alternative hedge structures and provide price indications;  Review and comment on all hedge documentation and business terms;  Assist in counterparty selection and developing terms for a request for bids (if desired);  Review competitive bids and make a recommendation for award or if so determined;  Negotiate the pricing terms and structure with the Counterparty(s);  Coordinate the closing of the transaction.

SWAP ADVISORY REQUIRED DISCLOSURES
PFMSA agrees that it will not deal with itself or with any other affiliated company or individual in making purchases or sales of the Swaps or any securities pursuant to this engagement, nor will it take a long or short position in securities subject to purchase or sale in connection with the Attachment Consent Item 10B
Swaps. PFMSA confirms that it has no interest in the purchase or sale of the Swaps other than as described in this Work Order and except for any financial or investment advisory agreement between Ava and PFMSA affiliates, or PFM Financial Advisors LLC.

MSRB Rules require that municipal advisors make written disclosures to its clients of all material conflicts of interest and certain legal or disciplinary events and certain regulatory requirements.

Such disclosures are provided in PFMSA’s Disclosure Statement delivered to Ava prior to or together with the Agreement.

PFMSA is a registered municipal advisor with the SEC and the Municipal Securities Rulemaking Board (the “MSRB”), pursuant to the Securities Exchange Act of 1934 Rule 15Ba1-2. As of the date of the Agreement, Ava has not designated PFMSA as its independent registered municipal advisor (“IRMA”) for purposes of SEC Rule 15Ba1-1(d)(3)(vi) (the “IRMA exemption.”). Ava agrees not to represent that PFMSA is Ava’s IRMA with respect to any aspect of a municipal securities issuance or municipal financial product, without PFMSA’s prior written consent.

Team Members:

George Hu, Director
Other personnel to be assigned as necessary
Attachment Consent Item 10B
Exhibit B
Schedule of Performance
Tasks will be performed at the direction of Ava staff.

Attachment Consent Item 10B
Exhibit C
Compensation
The compensation to be paid to Consultant under this Agreement, including the servicesprovided by PFM Swap Advisors LLC, for all services described in Exhibit “A” and reimbursable expenses shall not exceed a total of Seven Hundred and Fifty Thousand and 00/100 dollars ($750,000),as set forth below. Any work performed or expenses incurred for which payment would result in a total exceeding the maximum amount of compensation set forth herein shall be at no cost to Ava unless previously approved in writing by Ava. Consultant compensation will be allocated between PFM Financial Advisors LLC and PFM Swap Advisors LLC based upon final known distribution of work between the two parties for their respective scopes of work.

The compensation to be paid to Consultant under Work Orders #1 and #2 for all services and reimbursable expenses shall not exceed a total of Two Hundred and Fifty Thousand and 00/100 dollars ($250,000.00), per prepayment transaction, as set forth below. Fee is expected to be split $225,000 for PFM Financial Advisors LLC and $25,000 for PFM Swap Advisors LLC.

Payment
All compensation to be paid to Consultant, including payment to PFM Swap Advisors LLC by Ava under this Agreement shall be paid upon closing of the Bonds and shall be payable solely from the proceeds of the Bonds. In the event that the Bonds do not issue or close for any reason neither Ava nor the Issuer shall owe any monies to Consultant for the services provided pursuant to this Agreement.

Reimbursable Expenses
Administrative, overhead, secretarial time or overtime, word processing, photocopying, in house printing, insurance and other ordinary business expenses are included within the scope of payment for services and are not reimbursable expenses. Travel expenses must be authorized in advance in writing by Ava.

Additional Services
Consultant shall provide additional services outside of the services identified in Exhibit A only by advance written authorization from Ava Representative prior to commencement of any additional services. Consultant shall submit, at Ava Representative’s request, a detailed written proposal including a description of the scope of additional services, schedule, and proposed maximum compensation. Any changes mutually agreed upon by the Parties, and any increase or decrease in compensation, shall be incorporated by written amendments to this Agreement.

Attachment Consent Item 10B
Exhibit D
Insurance Requirements and Proof of Insurance
Insurance Statement
PFM Financial Advisors LLC (“PFM”) has a complete insurance program, including property, casualty, general liability, automobile liability and workers compensation. PFM maintains Professional (E&O)/Cyber Liability coverage which total $5 million single loss/ aggregate.

Our Professional/Cyber Liability policies are a “claims made” policy and our General Liability policy claims would be made by occurrence.

Deductibles/SIR:

Automobile $100 comprehensive & $1,000 collision
General Liability $0
Professional (E&O)/ Cyber Liability $250,000
Crime $50,000
Insurance Company & AM Best Rating
Professional Liability (E&O).................... AIG Specialty Insurance Company; (A; Stable) Cyber Liability......................................... AIG Specialty Insurance Company (A; Stable) Crime...................................................... Berkley Regional Insurance Company; (A+; Stable) General Liability...................................... The Phoenix Insurance Company; (A++ Stable) Automobile Liability................................. St. Paul Protective Insurance Company (A++ Stable) Excess /Umbrella Liability....................... Travelers Property Casualty Company of America; (A++ Stable)
Workers Compensation.......................... Travelers Casualty Ins Co of America; (A++ Stable) & Employers Liability
Attachment Consent Item 10B
Exhibit E
Confidentiality Requirements
Subject to the terms and conditions of the Agreement, current proprietary and confidential information of Ava regarding customers of Ava (“Ava Customers”) and/or other confidential information (collectively “Confidential Information”) may be disclosed to Consultant from time to time in connection herewith solely for the purposes set forth in the Agreement. Such disclosure is subject to the following legal continuing representations and warranties by Consultant:

1. The Confidential Information disclosed to Consultant in connection herewith may include, without limitation, the following information about Ava Customers: (a) names; (b) addresses; (c) telephone numbers and email addresses; (d) service agreement numbersand account numbers; (e) meter and other identification numbers; (f) Ava-designated account numbers; (g) electricity and gas usage (including monthly usage, monthly maximum demand, electrical or gas consumption, HP load, and other data detailing electricity or gas needs and patterns of usage); (h) billing information (including rate schedule, baseline zone, CARE participation, end use code (heat source) service voltage, medical baseline, meter cycle, bill cycle, balanced payment plan and other plans); (i) payment / deposit status; (j) number of units; and (k) other similar information specific to Ava Customers individually or in the aggregate. Confidential Information shall also include specifically any copies, drafts, revisions, analyses, summaries, extracts, memoranda, reports and other materials prepared by Consultant or its representatives that are derived from or based on Confidential Information disclosed by Ava, regardless of the form of media in which it is prepared, recorded or retained.

2. Except for electric and gas usage information provided to Consultant pursuant to this Agreement, Confidential Information does not include information that Consultant proves (a) was properly in the possession of Consultant at the time of disclosure; (b) is or becomes publicly known through no fault of Consultant, its employees or representatives; or (c) was independently developed by Consultant, its employees or representatives without access to any Confidential Information.

3. From the Effective Date, no portion of the Confidential Information may be disclosed, disseminated or appropriated by Consultant, or used for any purpose other than the purposes set forth in the Agreement.

4. Consultant shall, at all times keep the Confidential Information in the strictest confidence and shall take all reasonable measures to prevent unauthorized or improper disclosure or use of Confidential Information. Consultant shall implement and maintain reasonable security procedures and practices appropriate to the nature of the information, to protect the personal information from unauthorized access, destruction, use, modification, or disclosure and prohibits the use of the data for purposes not set forth in the Agreement.

Specifically, Consultant shall restrict access to Confidential Information, and to materials prepared in connection therewith, to those employees or representatives of Consultant who have a “need to know” such Confidential Information in the course of their duties with respect to the Consultant program and who agree to be bound by the nondisclosure and confidentiality obligations of this Agreement. Prior to disclosing any Confidential Information to its employees or representatives, Consultant shall require such employees or representatives to whom Confidential Information is to be disclosed to review this Agreement and to agree to be bound by the terms of this Agreement. Consultant shall not Attachment Consent Item 10B
disclose Confidential Information or otherwise make it available, in any form or manner, to any other person or entity that is not Consultant’s employee or representative (a “Third Party”), except where that Third Party has separately entered into a nondisclosure agreement with Ava.

5. Notwithstanding the above, Consultant may disclose Confidential Information to the extent required by an order, subpoena, or lawful process requiring the disclosure of such Confidential Information issued by a court or other governmental authority of competent jurisdiction, provided that, to the extent not legally prohibited, Consultant notifies Ava promptly upon receipt thereof to allow Ava to seek protective treatment for such Confidential Information.

6. Consultant shall immediately notify Ava if it reasonably believes that there has been unauthorized access to the Confidential Information by a non-authorized person that could reasonably result in the use, disclosure, or theft of the Confidential Information.

7. It shall be considered a material breach of this Agreement if Consultant engages in a pattern or practice of accessing, storing, using, or disclosing the Confidential Information in violation of the contractual obligations described herein. Consultant understands that if Ava finds that Consultant is engaged in a pattern or practice of accessing, storing, using, or disclosing Confidential Information in violation of this Agreement Ava shall promptly cease all disclosures of Confidential Information to Consultant. Consultant further understands that if Ava receives a customer complaint about Consultant’s misuse of data or other violation of the Disclosure Provisions, Ava shall promptly cease disclosing that customer’s information to Consultant and shall notify the California Public Utilities Commission of the complaint.

8. Consultant shall be liable for the actions of, or any disclosure or use by, its employees or representatives contrary to this Agreement; however, such liability shall not limit or prevent any actions by Ava directly against such employees or representatives for improper disclosure and/or use. In no event shall Consultant or its employees or representatives take any actions related to Confidential Information that are inconsistent with holding Confidential Information in strict confidence. Consultant shall immediately notify Ava in writing if it becomes aware of the possibility of any misuse or misappropriation of the Confidential Information by Consultant or any of its employees or representatives.

However, nothing in this Agreement shall obligate Ava to monitor or enforce the Consultant’s compliance with the terms of this Agreement.

9. Consultant shall comply with the consumer protections concerning subsequent disclosure and use set forth in Attachment B to California Public Utilities Commission (CPUC) Decision No. 12-08-045.

Attachment Consent Item 10B

10. In addition to any other requirements set forth in the Agreement, within ten (10) business days of receipt of Ava’s written request, and at Ava’s option, Consultant will either return to Ava all tangible Confidential Information, including but not limited to all electronic files, documentation, notes, plans, drawings, and copiesthereof, or will provide Ava with written certification that all such tangible Confidential Information of Ava has been destroyed; provided, however, the foregoing shall not include (i) such copies as Consultant is required to retain by law or regulation, (ii) copies automatically saved electronically as part of a computer disaster recovery or similar back- up system or internal document retention and business continuity policies and procedures, or (iii) materials prepared by Consultant or its advisors for its board of directors or any board committee or other applicable decision-making body to the extent such materials contain Confidential Information.

11. Consultant acknowledges that disclosure or misappropriation of any Confidential Information could cause irreparable harm to Ava and/or Ava Customers, the amount of which may be difficult to assess. Accordingly, Consultant hereby confirms that Ava shall be entitled to apply to a court of competent jurisdiction or the California Public Utilities Commission for an injunction, specific performance or such other relief (without posting bond) as may be appropriate in the event of improper disclosure or misuse of its Confidential Information by Consultant or its employees or representatives. Such right shall, however, be construed to be in addition to any other remedies available to Ava, in law or equity.

12. In addition to all other remedies, Consultant shall indemnify and hold harmless Ava, its officers, employees, or agents from and against and claims, actions, suits, liabilities, damages, losses, expenses and costs (including reasonable attorneys’ fees, costs and disbursements) attributable to actions or non-actions of Consultant and/or its employees and/or its representatives in connection with the use or disclosure of Confidential Information.

13. When Consultant fully performs the purposes set forth in the Agreement, or if at any time Consultant ceases performance or Ava requires Consultant cease performance of the purposes set forth in the Agreement, Consultant shall promptly return or destroy (with written notice to Ava itemizing the materials destroyed) all Confidential Information then in its possession at the direction of Ava, subject to Section 10 above. Notwithstanding the foregoing, the nondisclosure obligations of this Agreement shall survive any termination of this Agreement.

Attachment Consent Item 10B
Consent Item 11
Consent Item 11
To: Ava Community Energy Authority
From: Chris Eshleman, Director of Energy Analytics and Electric Supply Subject: Adopting a Resolution of the Board of Directors of Ava Community Energy Authority Authorizing the CEO to Negotiate and Execute a Fourth Amendment (“Amendment D”) to the SmartBidder Master Agreement (“the Agreement”) - Software as a Service with Ascend Analytics
Date: June 17, 2026
__________________________________________________________________ Recommendation
Adopt a Resolution authorizing the Chief Executive Officer to negotiate and execute a Fourth Amendment to the SmartBidder Master Agreement for Software-as-a-Service (SaaS) bid optimization services with Ascend Analytics LLC (“Ascend”). The proposed Fourth Amendment would renew the Agreement for a one-year term and continue software and support services for all covered storage and renewable generation assets. The Amendment would authorize a not to exceed amount of $336,110 for the renewal term for the Agreement.

The original Agreement was executed on June 22, 2023, and subsequently amended on March 21, 2024, March 20, 2025, and September 19, 2025 (collectively, the “Agreement”). The proposed Fourth Amendment will ensure continuity of bid optimization services that support Power Resources’ participation in wholesale energy markets and ongoing portfolio optimization activities. The Fourth Amendment will also establish a framework for future annual renewals, transition identified project licenses to annual invoicing, reconcile prior invoices to confirm proper application of applicable discounts, continue application of the existing multi-project discount, and amend Exhibit A (Statement of Services, Support, and Service Level Agreement) of the Agreement to reflect the renewal pricing schedule for the covered projects.

Financial Impact
Consent Item 11
The proposed Fourth Amendment will renew the existing SmartBidder Master Agreement for a one-year renewal term beginning June 24, 2026 and ending June 23, 2027 at a cost not to exceed $336,110. Staff evaluated the renewal pricing and determined it to be competitive with, and generally below, comparable market offerings for energy storage and renewable asset optimization software and related support services.

Analysis and Context
Renewal of the Agreement with Ascend will ensure continuity of critical bid optimization and asset management services for an additional one-year renewal term. Continued use of a centralized optimization platform reduces operational redundancies, streamlines workflows, and enhances the efficient management of Ava's storage and renewable generation assets.

Attachments
A. Resolution Authorizing the CEO to Negotiate and Execute a Fourth Amendment to the Software as a Service SmartBidder Master Agreement with Ascend Analytics LLC B. Consulting Services Agreement Amendment
Attachment Consent Item 11A
RESOLUTION NO. R-2026-XX

A RESOLUTION OF THE BOARD OF DIRECTORS

OF AVA COMMUNITY ENERGY AUTHORITY AUTHORIZING THE CEO TO

NEGOTIATE AND EXECUTE A FOURTH AMENDMENT TO THE SMARTBIDDER

MASTER AGREEMENT - SOFTWARE AS A SERVICE WITH ASCEND ANALYTICS WHEREAS Ava Community Energy Authority (“Ava”) 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 Ava and parties to the Joint Powers Agreement (“JPA”) in March of 2020. The City of Stockton was added as a member to Ava in September of 2022. The City of Lathrop was added as a member to Ava in October of 2023. San Joaquin County was added as a member to Ava in July 2024. On October 24, 2023, Ava legally adopted the name Ava Community Energy Authority, where it had previously used the name East Bay Community Energy Authority since its inception; and WHEREAS Ava and Ascend Analytics LLC (“Ascend”) previously entered into a Master Agreement – Software as a Service for storage and renewable bid optimization software services dated June 22, 2023, which was first amended on March 21, 2024, subsequently amended on March 20, 2025, and further amended on September 19, 2025 (collectively, the “Agreement”); and
WHEREAS the Agreement provides software and support services that enable centralized optimization and management of Ava’s storage and renewable generation assets in support of Power Resources’ operational and market participation objectives; and
WHEREAS Ava desires to renew the Agreement for an additional one-year renewal term beginning June 24, 2026 and ending June 23, 2027, to ensure continuity of operations, maintain existing functionality and services, and continue efficient management and optimization of portfolio resources through a centralized platform; and WHEREAS Ava and Ascend desire to establish a framework for annual renewals, transition identified project licenses to annual invoicing, reconcile prior invoices, continue the existing multi-project discount, and amend Exhibit A (Statement of Services, Support, and Service Level Agreement) of the Agreement to reflect the renewal pricing schedule; and
Attachment Consent Item 11A
WHEREAS Ava and Ascend desire to increase the Agreement amount by an amount not to exceed $336,110 for the renewal term.

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

Section 1. The Board of Directors hereby authorizes the Chief Executive Officer to negotiate and execute, subject to approval by General Counsel, a Fourth Amendment to the Agreement to renew the Agreement for an additional one-year renewal term beginning on June 24, 2026 and ending on June 23, 2027, add additional terms to the Agreement regarding renewals and billing, and increase the Agreement amount by an amount not to exceed $336,110.

ADOPTED AND APPROVED this 17th day of June 2026
Betsy Andersen, Chair
ATTEST:

Adrian Bankhead, Clerk of the Board
1 32061.00004\45077496.2

AMENDMENT D
2026 RENEWAL AND TERM AMENDMENT
This Amendment D (this "Amendment") to the Master Agreement - Software as a Service dated June 22, 2023 (the "Master Agreement"), as amended by Amendment A dated March 21, 2024, Amendment B dated March 20, 2025, and Amendment C dated September 19, 2025 (collectively, the "Agreement"), is made and effective as of [__________], 2026 (the "Amendment Effective Date"), by and between Ascend Analytics LLC ("Ascend") and Ava Community Energy Authority, formerly known as East Bay Community Energy Authority ("Ava" or "Licensee"). Ascend and Ava are each referred to individually as a "Party" and collectively as the "Parties." WHEREAS, Pursuant to Section 6.1 of the Master Agreement, the Agreement is currently scheduled to expire at the conclusion of the existing renewal term in June 2026; WHEREAS, the Parties desire to preserve continuity of services under the Agreement for an additional renewal term through June 23, 2027, consolidate the renewal of the covered SmartBidder resources into this Amendment, establish a renewal framework for future annual renewals, continue application of the existing multi-project discount, transition the identified project licenses to annual invoicing, reconcile prior invoices to confirm proper application of applicable discounts and amend Exhibit A to reflect the renewal pricing schedule for the covered projects;
NOW, THEREFORE, in consideration of the mutual promises set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are acknowledged, the Parties agree as follows:

1. Amendment to Section 6.1 (Term). Section 6.1 of the Master Agreement is hereby deleted in its entirety and replaced with the following:
"6.1 Term. This Agreement is legally binding as of the Effective Date and shall continue for two (2) years (the "Initial Term") unless extended, renewed, or sooner terminated as provided herein. Following the Initial Term, and unless otherwise terminated as provided herein, this Agreement may be renewed for successive one (1) year renewal terms (each, a "Renewal Term") by written agreement of the Parties.

Each Renewal Term shall be subject to the pricing and other terms, set forth in the applicable written renewal document. For avoidance of doubt, no Renewal Term shall arise automatically unless expressly stated in a written agreement signed by the Parties.”

2. Amendment to Exhibit A; Multi-Project Discount; Pricing Treatment; Reconciliation. Exhibit A (Statement of Services, Support, and Service Level Agreement) to the Agreement is hereby amended, in part, as follows:

Attachment Consent Item 11B
2 32061.00004\45077496.2
“Ascend shall provide renewed SmartBidder Premium bid optimization Software licenses to Ava for the resources listed below for the renewal term beginning June 24, 2026, and ending June 23, 2027 (the "2026 Renewal Term"). The annual license fees below apply the twenty percent (20%) multi-asset discount structure under the Agreement to the applicable renewed resources and include a two percent (2.0%) CPI adjustment for the 2026 Renewal Term. Ascend shall invoice the license fees annually, and Ava shall pay undisputed amounts in accordance with the payment terms of the Agreement. Within sixty (60) days following the Amendment Effective Date, the Parties shall reconcile invoices issued under the Agreement to verify proper application of the applicable multi-project discount to each Project from the date such Project became eligible for the discount. Any overpayments identified through such reconciliation shall be refunded or credited against future invoices at Ava’s election.” Project Name Renewal Term
Monthly Fee Basis
(inclusive of
applicable discount)
CPI
Adjustment
Annual License
Fee
Billing
Frequency
Tumbleweed
6/24/2026 -
6/23/2027
$3,600.00 2.0% $44,064.00 Annual
Scarlett 1
6/24/2026 -
6/23/2027
$4,760.00 2.0% $58,262.40 Annual
Daggett 3
6/24/2026 -
6/23/2027
$4,260.00 2.0% $52,142.40 Annual
Sun Pond
6/24/2026 -
6/23/2027
$6,680.00 2.0% $81,763.20 Annual
Kola II
6/24/2026 -
6/23/2027
$8,160.00 2.0% $99,878.40 Annual
For the 2026 Renewal Term, Ascend shall continue to provide the applicable Services, support, service levels, training, data access and extraction rights, data privacy and information security obligations, confidentiality obligations, insurance, indemnity, and other obligations under the Agreement for the renewed resources, except as expressly amended by this Amendment.”

3. Annual Billing. Commencing with the 2026 Renewal Term, Ascend shall invoice Ava annually in advance for the Project fees set forth in Exhibit A-1. No invoice may be issued earlier than the first day of the Attachment Consent Item 11B
3 32061.00004\45077496.2
applicable Renewal Term unless otherwise agreed in writing by Ava. Ava shall pay undisputed amounts due under a properly submitted invoice within thirty (30) days following receipt of such invoice in accordance with the payment provisions of the Agreement. Ava's payment obligation shall remain subject to all rights, remedies, offsets, credits, invoice review rights, and dispute rights contained in the Agreement. The Parties acknowledge that the annual invoicing structure established by this Amendment is being implemented in consideration of (i) the reduction of the annual CPI adjustment from 2.8% to 2.0%, and (ii) Ascend's obligation to provide the Services continuously throughout the entire applicable Renewal Term. Annual fees invoiced pursuant to this Section shall be deemed earned by Ascend on a ratable monthly basis over the applicable Renewal Term as Services are actually performed and delivered. No annual fee shall be deemed fully earned upon receipt of payment by Ava. If the Agreement or any Project-specific Services are terminated, expire, suspended, discontinued, or otherwise cease prior to the end of the applicable Renewal Term for any reason permitted under the Agreement, Ascend shall promptly refund to Ava all prepaid fees allocable to the portion of the Renewal Term for which Services were not provided. Such refund shall be calculated on a pro rata daily basis and shall be paid to Ava within thirty (30) days following the effective date of such termination, expiration, suspension, discontinuation, or cessation of Services. Ava's payment of an annual invoice shall not constitute acceptance of deficient Services, waiver of any claim, waiver of any service-level credits, waiver of any indemnification rights, or waiver of any other rights or remedies available under the Agreement or applicable law. Any credits, overpayments, refunds, service-level credits, pricing adjustments, or discount reconciliation amounts owed to Ava under the Agreement may, at Ava's sole election, be refunded directly to Ava or applied against future invoices.

4. No Other Changes. Except as expressly amended by this Amendment, all terms and conditions of the Agreement remain in full force and effect. In the event of any conflict between this Amendment and the Agreement, this Amendment shall control solely with respect to the subject matter expressly amended herein. Notwithstanding the foregoing, upon execution of a written master services agreement expressly superseding and replacing the Agreement, the Agreement and any corresponding amendments shall terminate and be replaced by such successor agreement.

5. Counterparts; Electronic Signatures. This Amendment may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument. Signatures transmitted electronically or by facsimile shall have the same legal effect as original signatures. [Signature Page Follows]
Attachment Consent Item 11B
4 32061.00004\45077496.2
IN WITNESS WHEREOF, the Parties have executed this Amendment as of the Amendment Effective Date.

AVA COMMUNITY ENERGY AUTHORITY
By: ______________________________
Name: Howard Chang
Title: Chief Executive Officer
Date: _____________________________

ASCEND ANALYTICS LLC
By: ______________________________
Name: Matt Tormollen
Title: Chief Executive Officer
Date: _____________________________
Approved as to form:
____________________________________
Ava General Counsel
Attachment Consent Item 11B
CEO Report Item 12
CEO Report Item 12
TO: Ava Community Energy Board of Directors
FROM: Howard Chang, Chief Executive Officer
SUBJECT: CEO Report (Informational Item)
DATE: June 17, 2026
________________________________________________________________________ Recommendation
Accept Chief Executive Officer (CEO) report on update items below.

Executive Committee Meeting
An Executive Committee Meeting was held on Wednesday, June 3, 2026. Members received an overview of energy prepayment financing, an introduction to asset ownership, and an update on the FY 2026-2027 draft budget. The meeting also included a closed session on the CEO’s annual performance evaluation. The next Executive Committee meeting will be held on Wednesday, July 3, 2026 at 3 pm.

Finance, Administration and Procurement Subcommittee Meeting A Finance, Administration and Procurement Subcommittee Meeting was held on May 27, 2026.

Members received updates on the FY 2025-2026 Q3 financial statements and on energy prepayment financing, and a preview of the FY 2026-2027 budget. The next Finance, Administration and Procurement Subcommittee meeting will be held on Wednesday, September 9, 2026 at 3:30 pm.

Marketing Regulatory and Legislative Subcommittee Meeting A Marketing Regulatory and Legislative Subcommittee Meeting was held on Friday, June 12, 2026. Members received a mid-session review of the 2026 California legislative session, an update on the results of the Health-e Communities pilot, and an overview of the power content label. The next Marketing, Regulatory and Legislative Subcommittee meeting will be held on Friday, September 18, 2026, 2023 at 10 am.

GPTW Recognition
Ava has once again earned a Great Place To Work Certification, marking our third consecutive year of recognition since we began participating in the program three years ago.

Great Place To Work is a globally recognized authority on workplace culture and is locally based, with its headquarters in the same building as Ava’s office. The certification process evaluates employee experience through a trust index survey and a culture questionnaire. This year, 85% of Ava employees said Ava is a great place to work, compared with 57% of CEO Report Item 12
employees at a typical U.S.-based organization. This continued recognition reflects Ava’s ongoing commitment to building a high-trust, inclusive, and mission-driven workplace.

Long Term Project Online Date Announcement
The following projects under contract with Ava have reached commercial operations.

1. SunZia North: The SunZia North project is a 74.6 MW share of a larger wind facility located in San Miguel County, New Mexico delivering clean energy into California via the SunZia Transmission project. SunZia North achieved its Commercial Operation Date on May 29, 2026.

2. SunZia South: The Sunzia South project is 175.4 MW share of a larger wind facility located in Lincoln County, New Mexico delivering clean energy into California for via the SunZia Transmission project. SunZia South achieved its Commercial Operation Date on May 29, 2026.

SunZia Wind North and South are part of a larger 3,500MW ‘SunZia Wind’ wind facility spanning across Torrance, Lincoln, and San Miguel counties in central New Mexico. The SunZia Transmission project is a 550-mile, ±525 kV high-voltage direct current (HVDC) transmission line between central New Mexico and south-central Arizona, with the capacity to transport 3,000 MW of clean, renewable energy. Together, the full SunZia Wind facility and the SunZia Transmission project comprise one of the largest renewable energy infrastructure projects in U.S. history with an expectation of supplying 1 million American homes with clean power. The SunZia project is developed and operated by Pattern Energy. Ava is using SunZia North and South to support compliance with 2026 Mid-Term Reliability obligations.
1 SunZia North wind turbines, Lincoln
County, NM
2 Transmission lines connecting to the
SunZia project, Central New Mexico

3. Alpaugh: The Alpaugh project is a 5 MW solar facility paired with a 5 MW / 20 MWh battery energy storage system (“BESS”) located in Tulare County, California, approximately across 277 acres. The Alpaugh project is developed and operated by RWE Clean Energy. The Alpaugh facility achieved its Commercial Operation Date on May 29, 2026. Ava will receive Resource Adequacy from the Alpaugh facility, supporting compliance with 2026 Mid-Term Reliability obligations.

CEO Report Item 12
3 Alpaugh Solar Facility, Tulare County CA

4. Tumbleweed-8hr: The Tumbleweed 8-hr expansion is a 50 MW battery energy storage system (“BESS”) located in Kern County, California, developed by REV Renewables.

Tumbleweed’s expansion doubled the facility’s energy discharge from 200 MWh (4 hours) to 400 MWh (8 hours) maintaining 50 MW of capacity. This unique expansion is a first-of-its-kind effort and California’s first utility-scale 8-hour lithium-ion long-duration storage facility. The Tumbleweed 8-hr battery expansion became operational for Ava on June 1, 2026, and fulfills Ava's compliance obligation for a long-duration storage resource under the Long-Lead Time (LLT) requirements of the Mid-Term Reliability decision.
4 Tumbleweed Solar Facility, Kern County,
CA
Longterm Renewable Portfolio Update
Rosamond Central was Ava’s first long-term Agreement to reach commercial operations in late 2020. Since then, Ava’s portfolio of online projects has grown to 890 MW of solar and wind generation, and 395 MW of battery storage capacity. The table below lists the online projects in Ava’s portfolio of long-term wholesale energy agreements, providing renewable generation and storage capacity to California for Ava customers.

Ava’s Online Renewable
Generation & Storage
Projects
Technology Start of
Delivery
Generation
Capacity
(MW)
Storage
Capacity
(MW)
CEO Report Item 12
Rosamond Central Solar 2020 112
Altamont Wind 2021 54.8
Tecolote Wind 2021 100
Henrietta Storage 2022 10
Luciana Solar 2022 55.83
Daggett Solar + Storage 2023 50 12.5
Oberon Solar + Storage 2024 125 125
Scarlet I Solar + Storage 2024 100 30
Kola Storage 2025 125
Sun Pond Solar + Storage 2026 42.5 42.5
SunZia North Wind 2026 74.6
SunZia South Wind 2026 175.4
Tumbleweed-8hr Storage 2026 50
Launch of First Prologis Solar Project under Ava Solar Discount Program A ribbon-cutting event was held on June 5th in East Oakland to celebrate the launch of a new community solar project designed to bring clean, affordable energy to local residents. This is the first of five projects developed in partnership with Prologis through California’s Disadvantaged Communities Green Tariff (DAC-GT) program and marketed to Ava’s customers as Solar Discount. Together, the five solar projects represent 7 MW of capacity and will serve roughly 3,000 customers. The program supports renewable energy development in underserved communities and provides income-qualified customers with access to 100% renewable energy at a 20% discount on their electricity bills. By activating existing industrial rooftops, this partnership expands access to clean energy in disadvantaged communities, strengthens local grid resilience through distributed generation, and delivers long-term economic and environmental benefits. Additional projects are in development in San Leandro, Hayward, and Tracy, continuing to scale impact across the region.

Heat Pump Water Heater (HPWH) Technology Support
From May 2020 – March 2025, Ava in partnership with BayREN, StopWaste, and other Bay Area CCAs, administered the Contractor Heat Pump Water Heater Incentive Program to provide $1,000 post-installation rebates to contractors to increase HPWH market penetration. While the program incentivized 663 HPWH installations in Ava’s service area over the program term, the last year of implementation saw a sharp decline in demand, leaving approximately $880K in unclaimed incentives. This represented 44% of total installations of 1,500 installed throughout the Bay Area Air District. During the Program average HPWH installation costs increased from $5,500 in 2020 to just over $9,000 in 2024, a ~60% increase. With rising install costs effectively offsetting program incentives, Ava is exploring other approaches to lower HPWH costs for customers.

On a regular basis, Ava staff meets with the other Bay Area CCAs to discuss potential program collaboration opportunities to provide support for potential impacts related to the Bay Area Air District’s (“Air District”) Regulation 9, Rule 6 (“Rule 9-6”). This regulation would establish a zero nitrogen oxides (NOx) appliance standard for water heaters across the Bay Area in 2027.

Topics discussed include the following:

CEO Report Item 12
• Alternative permit streamlining effort – With SolarAPP+ Foundation not delivering on the contract with Ava to deliver a HPWH permit streamlining service, Ava staff is exploring working directly with interested Ava member jurisdictions to provide technical support for streamlining HPWH permitting in advance of Rule 9-6. • Contractor Incentive Program - Bay Area CCAs are coordinating on a new incentive offering specific to qualified local contractors that are not currently installing Heat Pump Water Heaters. The offering would incentivize new contractors to add HPWH installations to their business and increase the number of qualified contractors in Ava’s service area.
• Direct to customer rebates– Taking learnings from past rebate program efforts, staff is evaluating the effectiveness of a HPWH rebate program that would run in coordination with other CCA rebate programs.
• Financing solutions – CCAs are additionally evaluating various financing solutions related to billing solutions and financing providers to consider how they can help drive HPWH installations by helping customers spread payments over time.

Staff is preparing to make program recommendations to Ava leadership in advance of the go-live date for Rule 9-6. The Air District will meet in October to discuss further rulemaking details, including a revision to rule effective date.

Ava in the Community - June
To raise awareness of Ava’s service, support our community, and connect customers to our offerings, Ava sponsors and staffs events throughout our service territory all year long.

Additionally, we also deliver presentations to community groups. Below is a list of upcoming events we’ll be attending between 6/17 and 7/30. Learn more at https://avaenergy.org/about-ava/meetings-events/events/ Date Event Type Location
6/20/2026 Hayward Juneteenth Sponsoring & Tabling Mt Eden High School 6/20/2026 Stockton Juneteenth Sponsoring San Joaquin County Fairgrounds
6/27/2026 E Bike Test and Ride Sponsoring & Tabling Oakland Coliseum BART 7/1/2026 Lathrop Celebration Sponsoring & Tabling
Lathrop Generations
Center
7/10/2026 San Leandro Pride Sponsoring & Tabling Downtown Butterfly Plaza 7/9/2026 Lincoln Summer Nights
July Circus Theme Tabling only Lincoln Square Park
7/18/2026 Family Fun Festival Tabling and Sponsoring 3700 Pacific Ave, Stockton, CA 95204
7/24/2026 Dublin Leprechauns
Title Night Tabling and Sponsoring Fallon Sports Park
CEO Report Item 12
San Joaquin County Launch
Customers in unincorporated San Joaquin County are now receiving both their final required enrollment notice from Ava and PG&E bills that include Ava generation charges. These charges appear on the first page of the bill and typically again on page 3.

The current participation rate is 92%, consistent with last month. Customer activity is following the expected pattern, with opt-out activity increasing during the initial notice period and then leveling off during the enrollment month. Previous community enrollments have demonstrated a similar trend. Consistent with prior enrollments, staff anticipates a modest increase in opt-out activity following customers' first bill, as some customers may not have engaged with earlier notices or outreach efforts.

Solar customers with a true-up in May and June are starting enrollment with Ava this month and will see their first bill in July. Solar customers will be enrolled throughout the year, aligned with their solar true-up month; the final group will enroll in April 2027.

Ava continues to engage residents in unincorporated San Joaquin County through participation in local community events and advertising across multiple channels. In June, Ava continued running digital advertisements featuring updated creative that reflects the launch of service in the area. These ads are currently running on Google, Meta, YouTube, and AudioGO. In addition, Ava maintains a presence in local print publications, including the Latino Times, San Joaquin Magazine, and Tracy Press.

The unincorporated San Joaquin County service launch campaign is scheduled to conclude on June 30, following the completion of all required customer notices to non-solar residential and commercial customers. After the launch campaign ends, Ava will continue reaching San Joaquin County residents through ongoing brand awareness and customer engagement efforts.

CAC Chair Report
Vice-Chair Balkissoon
June 17, 2026
In light of the fact that Ava revenues recovered to a $130 million deficit v the predicted $250 million deficit predicted back in December 2025. The CAC felt that the $10 million reduction in the local development fund budget should be restored.

Background info- In December 2025 in a presentation related to the 2026 Financial Adjustment there was expected to be a $250 million dollar deficit based on PG&E’s rates being expected to decrease by approximately 30% while the PCIA is increasing, significantly impacting Ava’s revenue. Various adjustment scenarios were offered and scenario B was recommended. This scenario included a recommendation to reduce the local development fund budget by $10 million ( from funds not earmarked for specific programs).

The CAC proposed the following recommended adjustment to the FY2027 Annual Budget

1. Since the revenue deficits are not as dire as were projected back in December 2025, the CAC recommends that the BOD approve of the FY2026-2027 annual budget contingent on the restoration of the $10 million to the local development fund.

Secondly, there was concern that funding projections showed 0 funding for Local Development Funding in FY2027 budget. This sends the wrong message to our communities as was reflected in many public comments on this topic. To this end the CAC proposes a second recommendation.

2. It is recommended that the BOD develop a policy for a minimum dollar amount for local development funding each year based on some percentage of Ava’s net revenues.

Staff Report Item 14
Staff Report Item 14
To: Ava Community Energy Board of Directors
From: Howard Chang, CEO
Subject: Fiscal Year 2026-2027 Budget
Date: June 17, 2026
______________________________________________________
Recommendation
Adopt a resolution approving the 2026-2027 fiscal year budget as presented in Exhibit A Background and Discussion
Ava’s fiscal year is from July 1 through June 30. Each year the Board of Directors (the “Board”) approves the following fiscal year’s budget. The budget presented today incorporates feedback garnered from previous draft versions presented to the Executive Committee on May 6, 2026, and June 3, 2026, the Board on May 20, 2026, and the Financial, Administrative, and Procurement subcommittee on May 27, 2026.

The proposed budget (the “Budget”) outlines staff’s best estimates for costs and revenues anticipated for the next fiscal year, based on load, market prices, and Power Charge Indifference Adjustment (“PCIA”) charges. Due to these updates, the numbers in this Budget may differ from those presented in previous versions.

This Budget reflects Ava’s current best estimates of energy prices and includes two funding sources to stabilize costs: $18.9MM drawn from the Rate Stabilization Fund (RSF) and $5.3MM in additional GASB 62 funds. The GASB 62 funds will be recognized against incremental generation and capacity from the 2023 request for offer (RFO) projects starting in 2027, as outlined in Resolution R-2024-26.

Staff Report Item 14
Other factors and assumptions that are represented in this Budget are:
• No recommended changes to Ava’s value proposition to customers • Assumes Ava maintains a 1.25% uncollectable rate
• Energy costs are derived from a blend of contracted and open positions. Open prices are non-stressed, mean-forecasted market prices. • Implementation of a compliance period procurement methodology over a three-year period of 2024-2027 with an average target of 81% renewable and carbon free energy, which remains unchanged from previous Board-approved targets • No draws on credit facility or use of reserve funds
• Non-operating revenues assume an average of 3.5% interest rate earned through the fiscal year
• Personnel headcount of 5 incremental additional staff • No recommendation for Local Development allocation
Although the fiscal year 2026-27 budget forecasts a deficit of $18.9MM, the fiscal year 2025-26 budget is actualizing with a surplus in excess of $80MM and reflects Ava’s strong financial state. This is in addition to reserves of approximately $330MM and $162MM in RSF monies. While Ava has not previously utilized its RSF, it serves to balance over collection and under collection year-over-year.

In 2025, the Board approved the Rate Stabilization Fund Policy (P-22) By resolution R-2025-41 which authorizes the CEO and the Treasurer, or their designee, to utilize the RSF as needed to meet budgetary goals. The Budget includes the estimated amount of RSF deferred revenues ($18.9MM) intended for use in balancing the budget.

In future meetings, Staff plans to present a detailed proposal to the Board for allocation of the current fiscal year’s projected surplus for discussion and approval.

Fiscal Impact
The approved budget establishes the forecast of Ava’s fiscal position for the next 12 months.

Attachments:

A. Exhibit A: 1-Pager of the Fiscal Year 2026-2027 Budget B. Resolution Adopting Ava’s Fiscal Year 2026-2027 Budget C. Resolution R-2025-41 Rate Stabilization Policy Approval D. Policy Number 22-Rate Stabilization Fund Policy
E. Resolution R-2024-26 Renewable Surplus Allocation
F. Presentation on Fiscal Year 2026-2027 Budget
EXHIBIT A: 1-PAGER OF FISCAL YEAR 2026-2027 BUDGET
Attachment Staff Report Item 14A
Attachment Staff Report Item 14B
RESOLUTION NO. R-2026-XX

A RESOLUTION OF THE BOARD OF DIRECTORS

OF THE AVA COMMUNITY ENERGY AUTHORITY ADOPTING THE FISCAL YEAR 2026-2027 BUDGET
WHEREAS Ava Community Energy Authority (“Ava”) 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 Ava and parties to the Joint Powers Agreement (“JPA”) in March of 2020. The city of Stockton was added as a member to Ava in September of 2022. The city of Lathrop was added as a member to Ava in October of 2023. San Joaquin County was added as a member to Ava in July 2024. On October 24, 2023, Ava legally adopted the name Ava Community Energy Authority, where it had previously used the name East Bay Community Energy Authority since its inception; and WHEREAS Ava operates on a fiscal year budget cycle from July 1st through June 30th; and
WHEREAS draft versions of Ava’s budget for fiscal year 2026-2027 were presented to the Executive Committee on May 6, 2026, and June 3, 2026, the Finance, Administrative & Procurement subcommittee on May 27, 2026, and the Board of Directors (the “Board”) on May 20, 2026 (the “Prior Presentations”); and WHEREAS Staff has incorporated feedback from the Prior Presentations and prepared a revised proposed budget set forth in Exhibit A (the “Proposed Budget”); and WHEREAS in 2024, the Board adopted Resolution R-2024-26, approving the release of deferred revenues for long-term renewable energy and clean storage investments in calendar year 2027 at staff discretion; and WHEREAS the Proposed Budget includes recognition of half of the afore mentioned deferred revenues; and
WHEREAS in 2025, the Board adopted Resolution R-2025-41, approving the Rate Stabilization Fund Policy (P-22) which authorizes the CEO and the Treasurer, or their designee, to utilize the Rate Stabilization Fund (RSF) deferred revenues as needed to achieve budget objectives; and
WHEREAS the Proposed Budget includes the estimated amount of RSF deferred revenues to be utilized for the purpose of balancing the budget.

Attachment Staff Report Item 14B

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

Section 1. The Board of Directors hereby approves and adopts the Proposed Budget, as set forth in Exhibit A, as Ava’s fiscal year 2026-2027 budget.

ADOPTED AND APPROVED this 17
th day of June, 2026.

Betsy Andersen, Chair
ATTEST:

Adrian Bankhead, Clerk of the Board
RESOLUTION NO. R-2025-41

A RESOLUTION OF THE BOARD OF DIRECTORS

OF AVA COMMUNITY ENERGY AUTHORITY ADOPTING A RATE STABILIZATION FUND

AND POLICY
WHEREAS The Ava Community Energy Authority (“Ava”) 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 Ava and parties to the JPA in March of 2020. The city of Stockton, located in San Joaquin County was added as a member of Ava and party to the JPA in September of 2022. The city of Lathrop, located in San Joaquin County, was added as a member to Ava and party to the JPA in October of 2023. On October 24, 2023, the Authority legally adopted the name Ava Community Energy Authority, where it had previously used the name East Bay Community Energy Authority since its inception.

WHEREAS Ava currently maintains a GASB 62 Budget Stabilization Fund (the “Fund”) established by resolution R-2020-26, which allows for the accrual and deferral of excess revenue, identified as budget surplus revenues, to be recognized in successive periods to offset uncontrolled cost variations and preserve positive net position for Ava by mechanisms of accounting governed under the Governmental Accounting Standards Board (GASB).

WHEREAS the Fund is an integral part of Ava’s waterfall of liquidity resources and is used for short-term budget cycle liquidity challenges and other financial matters necessary for maintaining rate stability year-to-year for Ava’s customers.

WHEREAS similar agencies refer to funds that provide a similar rate stability mechanism as a Rate Stabilization Fund (RSF).

WHEREAS similar agencies that maintain a RSF have specific policies established that give guidance for management of the RSF.

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

Section 1. The GASB 62 Budget Stabilization Fund is hereby renamed the Rate Stabilization Fund (RSF).

Section 2. The Rate Stabilization Fund Policy attached to the staff report associated with this Resolution, is hereby approved.

Attachment Staff Report Item 14C
ADOPTED AND APPROVED this 17th day of September, 2025.

Betsy Andersen, Chair
ATTEST:

Adrian Bankhead, Clerk of the Board
Attachment Staff Report Item 14C
Attachment Staff Report Item 14D

RATE STABILIZATION FUND POLICY
Policy Number: 22
Approval Date: 9/17/2025
Agenda Item: Staff Report Item 10
Approved by Resolution: R-2025-41
PURPOSE:

The purpose of this Policy is to set guidelines for the processes for funding, utilizing, and managing the Rate Stabilization Fund (RSF) as a source of liquidity to manage financial and operational risk.

POLICY OBJECTIVES:

The establishment of the RSF will allow Ava to defer revenue in years when fiscal results are strong and to apply deferred revenue in years when financial results are negatively impacted by uncontrollable events. The RSF will provide Ava with a mechanism to protect customers from risks related to energy market volatility, extreme events, and regulatory changes, as well as maintain financial covenants, achieve annual budget objectives, and other such fiscal matters.

FUNDING MECHANISM:

Funding the RSF is accounted for under Governmental Accounting Standards Board (GASB) rules which codify and standardize the accounting management of revenue recognition for public agencies. Deferrals of revenue as a transfer to the RSF reduces net revenue recognized on budget statements, and net position in that period of deferral, by the same amount.

The Board of Directors (the “Board”) has authorized the Chief Executive Officer (CEO) and the Treasurer, or their designee, to defer revenue to the RSF from time to time such amount as may be determined as appropriate from any source designated as surplus in accordance with the budget previously approved by the Board, as established by resolution R-2020-26.

UTILIZATION MECHANISM:

Recognition of contributions to the RSF is also governed by GASB rules. Recognition of revenues as a transfer from the RSF increases net revenues recognized on budget statements, and net position in that period of recognition, by the same amount.

The Board has authorized the CEO and the Treasurer, or their designee, to utilize deferred revenues from the RSF from time to time in such amounts as necessary to stabilize rates, satisfy financial covenants, achieve budget objectives, and to implement direction provided by the Board.

REPORTING:

Attachment Staff Report Item 14D
The RSF balance is recorded on Ava’s Statement of Net Position. Transfers to and from the RSF are recorded in the Statements of Revenues, Expenses, and Changes in Net Position. Both statements are presented quarterly, and audited annually, in Ava’s financial statements.

TARGET FUND BALANCE:

The RSF balance target is 20% of operating expenses.

RSF HOLDINGS AND INVESTMENTS:

RSF balances are not required to be held in a separate account and may be commingled with other funds held by Ava for investment purposes but will be accounted for and reported separately. All Ava fund balances, including the RSF, are subject to Ava’s Board-approved and State Government Code compliant investment policy.

Attachment Staff Report Item 14E
RESOLUTION NO. R-2024-26

A RESOLUTION OF THE BOARD OF DIRECTORS
OF AVA COMMUNITY ENERGY AUTHORITY TO RELEASE $10,504,837 FROM THE FY2022-23 SURPLUS TOWARDS LONG-TERM RENEWABLE ENERGY AND CLEAN STORAGE INVESTMENTS IN 2027
WHEREAS The Ava Community Energy Authority (“Ava”) 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 Ava and parties to the JPA in March of 2020. The city of Stockton, located in San Joaquin County was added as a member of Ava and party to the JPA in September of 2022. The city of Lathrop, located in San Joaquin County, was added as a member to Ava and party to the JPA in October of 2023. On October 24, 2023, the Authority legally adopted the name Ava Community Energy Authority, where it had previously used the name East Bay Community Energy Authority since its inception.

WHEREAS with the approval of the 2022-23 fiscal year budget, the Board of Directors (the “Board”) approved a portion of surplus revenues to be allocated for long-term renewable energy and clean storage investments (the “Allocation”).

WHEREAS following the completion of the audit, the Allocation is $10,504,837 and is held as retained earnings in the GASB 62 Rate Stabilization Fund.

WHEREAS Ava is seeking to procure local, incremental generation and capacity from the 2023 RFO and intends to apply the Allocation to this portfolio of projects as they start delivery in 2027.

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

Section 1. Release the Allocation to the General Fund in 2027 at staff discretion of the exact date.

Attachment Staff Report Item 14E
ADOPTED AND APPROVED this 20th day of March 2024.

Jack Balch, Chair
ATTEST:

Adrian Bankhead, Clerk of the Board
Fiscal Year 2026-2027
Draft Budget
Howard Chang, CEO | June 17, 2026
Attachment Staff Report Item 14F
Introduction
2 • Every year in June, Ava Board of Directors (the “Board”) approves the following fiscal year’s budget and staff is seeking formal approval of this proposed final budget at today's regular board meeting • This budget was reviewed by an ad hoc group of the Ex Comm on 5/6, full board on 5/20, FAP on 5/27, and ExComm on 6/3
• The Budget covers the overall categories of the General Operating Fund:
▪ Revenues from Operations
▪ Energy Operating Expenses (typically 90%+ of total expenses) ▪ Services to Facilitate Energy Operations
▪ Operational Overhead to Energy Operations
▪ Non-Operating Revenues
▪ Non-Operating Expenses, including a Capital Transfer to the Local Development Fund Attachment Staff Report Item 14F
Current Fiscal Year 2025-2026 Performance
• Details on “Actuals” are settlements through April and updated projections through June.
• Revenue is expected to settle above budget due to Board action on value proposition in December.
▪ Other Operating Revenue is primarily fees and damages to Ava on energy contracts
• Cost of energy is coming in below expectations as
market prices softened and higher than expected large
hydro generation
• Total overhead is currently estimated at $7.4MM below budget due to opex reductions
• Non-operating activity is higher than expected as interest rates remain higher-for-longer and with the reduction of Local Development contributions
▪ Borrowing interest expenses have been moved to General & Administrative overhead due to accounting treatment
changes
• Overall Net Revenues are expected to come in at $83MM above estimates without using $35MM budgeted GASB
62 funds.
3 Attachment Staff Report Item 14F
Fiscal Year 2026-2027 Draft Budget
4 Attachment Staff Report Item 14F
Draft Budget Fiscal Year 2026-2027
• Revenues: Energy prices continue to soften and
with resolution of the CPUC's Track 1 PCIA proceeding,
generation rates and PCIA going into calendar year 2027 remain relatively stable. The fiscal year revenues decline because prior fiscal year included higher rates in calendar 2025
• Cost of Energy: Lower energy prices reduce open position costs
• Overhead: Increase in G&A is predominantly due to increased rent, a change in accounting treatment of credit facility fees, increasing software costs, and addition of five
headcount
• Non-Operating Activity: Higher interest income and lower borrowing interest due to a change in accounting treatment of credit facility. No incremental contributions to Local
Development Funding in fiscal year 2026-2027 with
current fund balance at $84MM
5 • Note: Incorporates the use of the Rate Stabilization Fund (RSF) to offset the forecasted deficit.
• Expanded budget view shown in appendix
Attachment Staff Report Item 14F
Draft Budget: Forecast Uncertainty
• May 15, 2026 PG&E ERRA filing provided a forecast for 2027 rates and PCIA ▪ The filing provides an update on a subset of the underlying assumptions but did not provide updated MPBs ▪ While a formal updated filing from PG&E is outstanding, we do not anticipate material changes ▪ This is separate from potential changes that may come from the General Rate Case (GRC) ▪ PG&E’s October ERRA filing will provide the next meaningful update on 2027 rates • PCIA Tracks 2 and 3 may have material impacts on PCIA and rate setting methodologies. Track 3 scope and timing presents the greatest uncertainty. 3 pre-scoping workshops have been scheduled for June. • Load forecast uncertainty:
▪ Weather conditions present the greatest impact on actualized load volume and shape ▪ With the addition of SJC, estimates will become more accurate as Ava receives more data beyond initial enrollment ▪ Longer-term: data center and electrification presents significant uncertainty as well • Energy prices are highly volatile and have softened over the last 6 months in response to a mild winter, accelerated melting snowpack, and new energy capacity coming online. Over the last month, we have seen price forecasts increasing
• New power generation project online dates may be delayed or moved forward impacting power portfolio expenses • Interest rates and macroeconomic environment may change 6 Attachment Staff Report Item 14F
May ERRA Addendum Filings
• The May 15 ERRA filing consists of the filing documents and the series of datasets called the “Working Papers”
▪ The filing and working papers can be accessed through the PG&E Azure website here:
https://pgera.azurewebsites.net/Regulation/search
• Select the “ERRA 2027 PGE – Forecase [A.25-05-007]” case from the dropdown menu and click search to see all documents available for download
• Staff is still processing the working papers with consultants to get better color on the details
7 • What is known:
• 2025 RA PCIA reform is in place at a steady state for 2027 • Load appears to be materially lower for PG&E due to milder than expected weather to date and community load departure
• PG&E's revenue requirements remain stable despite the reduction in load, increasing generation rates • What is not known from the ERRA:
• Direction on MPB settlement for all attributes
• A significant portion of the filing is redacted due to market sensitive confidential information and our 3rd party consultant has access to this information, which may be shared on a very limited basis • There were some known errors/inconsistencies that are in the process of being validated and reconciled Attachment Staff Report Item 14F
PCIA Proceeding & Risk Elements
The CPUC has an ongoing proceeding regarding the PCIA, divided into "Tracks". o Track 1
o CalCCA has appealed CPUC Track 1 decision; appeal is pending o Revised the MPB for RA retroactive through 2025
o Major driver for the much higher PCIA most Ava customers see in 2026 versus 2025 o Track 2
o Proceeding is ongoing; decision expected in time for inclusion in 2027 rates o The CPUC is reviewing the methodology for valuing RECs that PG&E "banked" prior to 2019 but did not actually use for compliance purposes until 2025. An interim methodology values those RECs at $0. This increases the PCIA for most Ava customers versus what the PCIA would be if those RECs were valued at the current market price for RECs
o Outcome indeterminate; CalCCA proposal would use current market prices for REC value, and lower the PCIA for most Ava customers versus status quo; PG&E proposal would make the status quo interim methodology permanent o Track 3
o Scope and timing undetermined
▪ CCAs propose to address reviewing the Track One revisions to MPBs; aligning the RA MPB with the RA Slice of Day framework; revintaging of PCIA resources; PCIA GHG-free methodology; and potentially other structural changes to the PCIA ▪ IOUs propose to prioritize changes to RPS MPBs ahead of any other issues, with changes to the brown power MPB next o Outcome indeterminate; CCA approach would likely reduce PCIA for most Ava customers if adopted while the IOU approach would likely raise the PCIA for most Ava customers if adopted 8 Attachment Staff Report Item 14F
Historical NP15 Energy Price Actuals
9 • NP15 is the most liquid pricing for the northern
CA region as the closest proxy to Ava’s wholesale
prices
• Power prices are set by a number of factors
impacting supply and demand, such weather,
natural gas prices, system capacity,
transmission congestion, etc.
• Volatility is high due to these uncertain and
changing factors year to year
• Customer rates (generation and PCIA) are set
based on a forecast while also incorporating a
true up of the prior year's forecasted market
prices with actualized prices
• 2026 rates were set by 2026 forecasted prices
and truing up 2025 actualized prices. 2027 rates
will be set by 2027 forecasted prices and truing
up 2026 actualized prices.

Attachment Staff Report Item 14F
Forward NP15 Energy Price Forecasts
10 • This graph reflects forward pricing for FY 2026-
2027 pricing broken out by month
o The individual lines reflect the forward curve at
different points in time over the past 6 months
• The spread between the lines ranges from $5
to $15 depending on the month, which reflects
the volatility in forward pricing
Attachment Staff Report Item 14F
11 Market Price Benchmark Trends 2020-2027
• Forecast MPBs used to develop PCIA and generation rates are calculated in Sept each year:
o Energy: Avg forward price during Sept for delivery the following year o REC: Avg executed contract price in the past 15 months for delivery in following year
o RA: Avg executed contract price in the past 3 years for delivery the following year
• Forecasted vs. Final MPBs vary significantly, reflecting year to year market volatility
• RA MPB in 2025 reflects regulatory changes, no future PCIA reform is assumed in forecasts
• "Final" numbers in 2026 reflect actuals through March and updated forecast as of April
RA Market Price Benchmark
Brown Power Market Price Benchmark
RPS Adder
Attachment Staff Report Item 14F
12 Historical Generation Rates & PCIA
• Rates increased and PCIA decreased from 2022 to 2025, driven by forecasted increases in energy market prices • Since 2025 energy costs have softened in addition to substantive PCIA reform, setting PCIA higher and rates lower in 2026
• Lower prices are expected to continue through 2026 and we are forecasting a modest increase to generation rates and a lower PCIA in 2027, though rates remain stable ▪ Between calendar year 2025 and 2026, customer rates dropped 20%, and between 2026 and 2027 Ava is estimating rates will increase 0.3% (inclusive of PCIA)
▪ Between fiscal year 2025 and 2026, customer rates dropped 2%, and between 2026 and 2027, rates are expected to drop another 11%
12 0.078 0.082 0.072 0.083

0.132 0.145

0.129

0.114

0.088

0.026 0.030 0.038

0.037

0.012

0.006

0.019

0.030

0.017 0.018

0.008 0.011

0.029

0.039

0.016 0.014
-0.001 -0.02
0 0.02

0.04 0.06

0.08 0.1

0.12 0.14

0.16 2019 2020 2021 2022 2023 2024 2025 2026 2027-Base
$/kWh
Fiscal Year
Customer Rate Revenue Profile
Ava Average Rates PCIA Fees Operating Expenses Margin

0.081 0.080 0.066

0.113

0.137 0.141 0.139

0.085 0.090

0.029 0.032 0.043

0.024

0.004 0.010 0.004

0.033 0.029

0.016 0.016

0.003

0.022

0.038 0.035

0.025
-0.011

0.000
-0.04
-0.02
0 0.02

0.04 0.06

0.08 0.1

0.12 0.14

0.16 2019 2020 2021 2022 2023 2024 2025 2026 2027-Base
$/kWh
Calendar Year
Customer Rate Revenue Profile
Ava Average Rates PCIA Fees Operating Expenses Margin
Attachment Staff Report Item 14F
Draft Budget: Revenues
• Despite higher load, revenue from electricity sales is expected to decrease for the fiscal year with Ava's generation rates declining ~11%. Note: calendar rates are flat and fiscal year rates are down because calendar 2025 rates were significantly higher.
• Value proposition remains unchanged at 0.5% discount to PG&E for Bright Choice and a $0.0175 premium on Renewable 100 products
• Estimated bad debt slightly increased from 1.0% to 1.25% of billings based on rising trends and getting ahead of possible inflation increases due to oil market volatility • $24.1MM recognition from GASB 62 deferred revenue
▪ $18.9MM from the Rate Stabilization Fund
▪ $5.2MM related to resolution R-2024-26, which is half of the $10,504,837 deferred for incremental clean energy generation and storage from the 2023 RFO for projects starting in 2027 13 Attachment Staff Report Item 14F
Draft Budget: Base Case Revenue Assumptions
• Base Case Assumptions have MPB’s for calendar year 2026 down to align with market actuals and forwards year to date
• Forward looking prices in cost of energy reflect market price assumptions • In addition to MPB assumptions, revenue requirement inputs directly from PG&E are critical in determining generation rates
o In May ERRA filing, PG&E's revenue requirement stayed relatively flat despite declining load in 2027, which needs further diligence
14 Attachment Staff Report Item 14F
FY 2026-2027 Scenarios & Sensitivities
15 Ava looked at possible alternative MPB/revenue scenarios —High-End and Low-End • High-end: calendar year 2026 prices end up as current MPB forecasts from May ERRA filings, which are unchanged from the October ERRA filing
• Low-end: calendar year 2026 prices are one standard deviation down from current forward averages for brown power and Ava’s base case RPS and RA estimates • There is upward pressure on rates based on PG&E's request for increase in revenue requirement in their GRC filing that is anticipated, but unlikely to be implemented in the 2026-27 fiscal year MPBs 2026 2027 2026 2027 2026 2027
Power 35.04 46.02 23.70 33.28 40.90 47.61
RPS 40.00 36.92 40.00 36.92 62.45 62.45
RA 10.00 10.00 10.00 10.00 11.53 11.53
Base Case Low End High End Base Case Low End High End
Revenues 800,658,000 722,789,000 885,732,000
Cost of Energy 789,541,000 769,507,000 833,389,000
Overhead 54,306,000 54,306,000 54,306,000
Net Non-Op 24,279,000 15,988,000 23,849,000
Net Revenues (18,910,000) (85,036,000) 21,886,000
Load (MWh) 9,553,000 9,553,000 9,553,000
Case estimates do not
include RSF contributions in
order for scenarios to have
an equivalent comparison.

Attachment Staff Report Item 14F
Draft Budget: Overview of Operating Expenses
16 Expenses are divided into three overall cost center
categories:
• Energy Operations which includes all energy, energy
attributes, ancillary related costs and required
management services such as scheduling, data
management, and customer billing
• This category comprises 93.6% of Ava’s total
operating expenses
• Overhead Operations which includes all personnel
and staffing needs as well as work function cost
centers required to manage the organization at large,
and is about 6.4% of total operating expenses
• Non-Operating Expenses which are all capital and
capital transfer related costs, including Local
Development Fund contributions. This category is
presented and discussed in a later slide
Attachment Staff Report Item 14F
Draft Budget: Energy Operations
17 Energy Costs
• Costs are generally derived from a blend
of contracted and open position for all
energy attributes
▪ Currently, renewables, carbon free, and RA
are fully procured
▪ Open prices are non-stressed, mean
forecasted
▪ Material increase in PPAs due to reduced
revenue expectations from lower market
prices
PPAs Hedges Open Resource
Adequacy
RECs Carbon Free Transaction
Costs
Other
Fiscal Year Cost of Energy Budget by Attribute
2022 2023 2024 2025 2026 2027
Attachment Staff Report Item 14F
Draft Budget: Marketing & Communications
18 FY 2027 Summary of Adjustments:
• Continued notifications to unincorporated San Joaquin County solar customers • Customer mailings for Fremont commercial Renewable 100 transition • Investment to a brand awareness strategy and launch phase one of a multi-year awareness initiative • Investment in sponsorships, fellow, partners to activate more robust community engagement Attachment Staff Report Item 14F
Draft Budget: General & Administrative
19 FY 2027 Summary of Adjustments:
• Operational Expenses: Increase is primarily due
to accounting change for fees with line of credit
• Memberships Dues & Sponsorships: Costs
associated with JPAs, trade associations, and
industry associations (CalCCA, CCCFA, CCPower,
CFEE, Veloz, etc.)
• Software & Subscriptions: Increases to cover
additional software needs for IT, Power Resources,
and EAS data and increased cyber security needs
• Rent & Utilities: Increase due to initiation of
primary lease agreement from a sub-lease
agreement and no longer receiving TI related
allowance
• HR & Recruiting: Some increase in recruiting costs
for placing temporary consultants
• Board & Director Fees: These are reduced to more
closely align with Board practices of requesting
stipends
Attachment Staff Report Item 14F
Draft Budget: Local Development Fund Balance*
20 Program Area Balance Earmarked
Local Development $2,800,000 $2,600,000
BE+EE
Building Electrification $14,600,000 $8,500,000
Building Efficiency Accelerator $1,300,000 $1,000,000
TE
Vehicle Electrification $8,100,000 $4,500,000
Ava Charge $15,900,000 $15,900,000
Bike Electric $2,200,000 $2,200,000
SmartHome Charging $5,700,000 $1,700,000
Resilience
Critical Municipal Facilities (CMF) $5,800,000 $5,800,000 SmartHome Battery $10,900,000 $10,900,000
Resiliency Hubs $5,600,000 $5,600,000
BE+TE Virtual Power Plant DERMS Platform $1,900,000 $1,900,000 Grants Community Investment Grants $8,800,000 $8,800,000 Total $83,600,000 $69,400,000
Local Development Fund Reconciliation Board Item from March 2025 *Fund balance as of 1/31/26 Attachment Staff Report Item 14F
Local Development – FY27 anticipated spend
21 Program Area FY '27 Spend Committed FY'27 Activities Program Roadmap $500,000 $500,000 Local Development Programs Roadmap Ava Charge $2,640,000 $6,750,000 Development, Operations and Marketing for 5 Sites Critical Municipal Facilities $2,000,000 N/A - 25 yr PPA Complete Projects, Establish operating reserves, bill customers
Grants $600,000 $1,900,000 Issue new solicitation, select at least three grantees and Payments for contracted grants
SmartHome Battery
incentives $1,250,000 $10,900,000 Upfront and ongoing payments for SHB Resilience Hub
TA/Incentives $1,500,000 $5,600,000 Upfront incentives and Technical Assistance costs Building Efficiency
Accelerator $1,000,000 $1,000,000 Incentives for Commercial Heat Pump Water Heaters Ava Bike Electric incentives $2,200,000 $2,200,000 Bike Electric will add $4M from ACTC Ava SmartHome Charging
incentives $300,000 $600,000 Enrollment incentives and VPP dispatch payment for SmartHome Charging program Total $11,990,000 $29,450,000
Attachment Staff Report Item 14F
Draft Budget: Deferred Revenues & Reserve Funds
22 • Current reserve fund balance
covers 40.1% of projected
operating expenses for FY 2027
• Current FY surplus estimate of
$83MM not included in
balances
• Staff will bring
recommendations for
allocation of the surplus to the
Board after completion of the
annual audit in November
• Budget includes a release of
$5.2MM, equal to 50% of the
deferred revenues related to
Clean Energy Investments
Deferred Revenue Usage Balance Guidance
Rate Stabilization Fund 162,546,828
R-2025-23 authorizes recognition of ~$35MM to balance FY25-26 budget R-2025-41 authorizes conversions from previous budget deferrals R-2025-42 & R-2025-51 authorizes RSF funding allocations Clean Energy Investments 10,504,837
R-2023-37 authorizes deferral for specified use.

R-2024-26 authorizes recognition in 2027
Contribution Year Contribution Withdraws Balance Operating Expenses* OpEx Year PctCoverage 2018-2019 40,513,687 40,513,687 - 410,686,000 FY 2019-2020 9.9% 2019-2020 49,704,640 90,218,327 - 383,045,000 FY 2020-2021 23.6% 2020-2021 - 90,218,327 - 471,897,000 FY 2021-2022 19.1% 2021-2022 65,655,073 155,873,400 - 562,667,000 FY 2022-2023 27.7% 2022-2023 75,000,000 230,873,400 - 732,885,000 FY 2023-2024 31.5% 2023-2024 100,000,000 330,873,400 - 814,123,000 FY 2024-2025 40.6% 2024-2025 - - 330,873,400 899,393,000 FY 2025-2026 36.8% 2025-2026** - 330,873,400 - 844,230,000 FY 2026-2027 39.2% *Operating Expenses are fiscal year ahead for coverage purposes: 2025-26 contribution year aligns with 2026-2027 OpEx **Expected contribution with current policy as of 5/6/2026 Deferred Revenue
Balances After Utilization Balance
Rate Stabilization Fund 143,636,828
Clean Energy Investments 5,252,419
Attachment Staff Report Item 14F
5 -Year Forecast
23 • The reliability of any 5-year revenue forecast is
limited due to poor visibility into key PG&E
inputs, such as revenue requirements and load o This forecast does not assume material changes to PG&E revenue requirements,
regulatory reform, and market prices.
o Actuals will vary based on potential known
and unknown changes
• Forecast Assumptions: o No material changes to rate setting and PCIA regulatory methodologies
o No change to current value proposition o Markets perform at non-stressed, mean expected prices
o Cost of energy services increases at
historical growth rate
o Overhead increases at rate of inflation o Interest rates persist at 3.5% • Surplus revenues can be applied to lowering
rates, clean energy procurement, local
development funding, working capital needs,
RSF/reserves, operational enhancements, etc.

Attachment Staff Report Item 14F
Conclusion & Authorization
• Staff is seeking approval of the presented fiscal year 2026-2027 budget, including the expectation to utilize $18.9MM from the Rate Stabilization Fund to fully offset the forecasted deficit o Actuals will change relative to budget scenarios based on energy market conditions, developments in CPUC proceedings, and updates to PG&E ERRA and GRC filings • Staff will provide a review with the board mid-year, incorporating 2026 actuals and final 2027 rates o PG&E's October ERRA filing will provide a meaningful update 24 Attachment Staff Report Item 14F
FY 2026-2027 Draft Budget Expanded View
25 Attachment Staff Report Item 14F
Appendix
26 Attachment Staff Report Item 14F
PCIA & Operating Headroom
27 • Ava’s generation rates to customers are indexed to PG&E’s generation rate • A portion of the generation cost is a charge from PG&E for the Power Charge Indifference Adjustment (PCIA) • The PCIA is how PG&E recovers "stranded costs or credits" for legacy generation resources • PCIA rates are based on an annual mark-to-market
• For Energy, Resource Adequacy (RA), and Renewable Portfolio Standard (RPS) resources, the mark-to-market is against "Market Price Benchmarks" (MPBs)
• Forecasts for MPBs are presented by the Investor-Owned Utilities (IOUs) in May and then updated in October to establish the following year’s rates
• PCIA and rates are "trued up" from forecast to actual, and any over-collection or under-collection is recovered in rates the following year.
• Higher MPBs --> higher rates and lower PCIA = more operating headroom for Ava • Lower MPBs --> lower rates and higher PCIA = less operating headroom for Ava Portfolio
Costs
Portfolio
Value*
Stranded
Costs/credit
*Value calculated using “Market
Price Benchmarks” (MPBs)
Attachment Staff Report Item 14F
Electricity Product Load & Rates
• Renewable 100:
• Originally set at $0.01/kWh above PG&E and has migrated down as Ava financials improved • Currently priced at $0.0175/kWh above PG&E rates
• Bright Choice:
• Originally set at 1.5% discount to PG&E, reduced to a 1% discount in 2021,increased to a 3% discount in 2022, increased to 5% discount to PG&E rates in 2023. Latest adjustment was to 0.5% discount to PG&E in January of 2026
• The percent load of Bright Choice customers is estimated at ~66% for FY 2027 28 0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
0 1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
8,000,000
9,000,000
10,000,000
2023 2024 2025 2026 2027
BC%
Retail MWh
Bright Choice as Percent of Retail Load by Fiscal Year
BC-Res BC-C&I R100-Res R100-C&I BC%
• Growth in Bright Choice in FY 2026 is
due to unincorporated SJC
• Growth in Renewable 100 in FY 2027
is due to Fremont opt up
• Annual load and load shape can
vary materially year to year and
between budget to actuals due to
weather, individual customer usage,
and expansion to new territories
Attachment Staff Report Item 14F
Draft Budget: Renewable & Large Hydro Content
29 • In April 2022, the Board approved the “Path to
Zero by 2030” plan for the Bright Choice
product, as shown in the table to the left
• Periodically, the Board has approved adjusting
targets to fit Ava’s financial position, typically
raising targets
• In December 2025, the Board approved a
compliance period approach across multiple
years instead of single year targets specifically
This table shows where Ava currently stands
with procurement relative to the compliance
period, and annual, targets
Year Renewables Lg. Hydro Total Renewables Lg. Hydro Total Long/Short 2024 52.0% 29.0% 81.0% 62.0% 33.7% 95.6% 14.6%
2025 56.0% 25.0% 81.0% 54.5% 35.5% 90.0% 9.0%
2026 55.6% 21.0% 76.6% 54.7% 18.0% 72.7% -3.9%
2027 64.0% 21.0% 85.0% 58.4% 12.3% 70.8% -14.3%
Period* 57.3% 23.7% 80.9% 57.4% 24.9% 82.3% 1.4%
Annual Targets Actuals/Forecast
Attachment Staff Report Item 14F
Draft Budget: Fiscal Year Personnel Details
• FY 2026 Budget was set for 7 additional FTE (105 total) to build more depth and to continue addressing increased workflow in key areas to help scale operations further. ▪ Ava is not filling 2 roles bringing the forecasted end of FY 2026 FTE to 103. • FY 2027 Budget seeks to add 5 FTE (108 total) to provide added expertise and support in key areas and help to meet essential business needs.
▪ 1) Contract Management Analyst 2) Finance Manager / Staff Accountant 3) Contract / Settlements Analyst ▪ 4) Optimization Software Engineer 5) Data Analyst
• Compensation Adjustments:
▪ COLA: 3%; Promotions/Wage Adjustments: 3%; AIP Compensation: 12% ▪ Accounting for increased healthcare premiums and associated benefit costs (realized and expected) • Change to benefits reflects some recategorization of expenses from Salaries & Wages to Health Care/Benefits 30 Attachment Staff Report Item 14F
Public Hearing - AB 2561: Ava FY 25-26 YTD
31 FY 2025 - 2026 Budgeted Headcount
Total Active FTE
Budgeted 105
New FTE Budgeted 7
New FTE Filled to date 5
Average Time to Hire 67 Days
Vacancy Rate 29%
Retention Rate 95%
Average Turnover Rate 5%
*For recruitment, only new budgeted positions are included. This does not account for other roles, like backfill positions.
*Reporting Period: FY 25-26; July ‘25 - April ‘26 (YTD at time of report) *Average Time to Hire: Days from role posted to start date. *FTE: Full-time employee; YTD: Year-to-date
Ava has a strong retention rate of 95%, with only 5
terminations so far this year.

Hiring Decision: Ava elected not to fill 2 positions this FY, bringing the total budgeted FTE down to 103.

Challenges faced in hiring:
• Finding a great fit can take time, but it’s worth it. ▪ We are prudent in our hiring process, strategically
planning the timing of hiring, carefully considering all aspects of the role and desired impact.
• Competition for talent is high, especially in the Bay Area What helps us overcome challenges?
• A strategic and robust hiring approach
• Ava is mission-driven & a certified Great Place to Work! This slide and data presented ensure compliance to AB 2561, which requires local public agencies to present the status of vacancies and recruitment and retention efforts at a public hearing before the governing board of the local agency at least once per fiscal year.

Attachment Staff Report Item 14F
Draft Budget: Legal, Policy, & Regulatory Affairs
32 FY 2027 Summary of Adjustments
Legal:
• Litigation counsel: funding to cover active litigation; litigation readiness; other potential disputes
• Commercial counsel: all procurement activities other than power resources • Software and implementation: Legal research resources; contract platform Phase 3 rollout Policy and Regulatory Affairs
• Federal and state lobbyists
• Consultants for compliance and CAISO matters
• Potential AI services
Attachment Staff Report Item 14F
Draft Budget: Professional Services
33 FY 2027 Summary of Adjustments:
• Technology Consultants: Expanding operations requires additional engineering and CRM structure and design support
• Other Services: Primarily reflects temporary consultants and contractors, which was recategorized and consolidated this year
Attachment Staff Report Item 14F
Draft Budget: Non-Operating Activity
34 Non-Operating Revenue
• Interest Income: Reflects “higher-for-longer”
FED interest rate policy and expected balance
drawdowns
▪ Rates are estimated to hold at 3.5%
• Other Non-Operating Revenue: is expected
income AT&T tower rent at the 8th Street building
Non-Operating Expenses
• Borrowing Interest: reduced due to changes in
line of credit accounting
• Capital Expenditures: costs estimated for
general improvements at 1999 Harrison St
offices
• Local Development: no planned incremental
contributions in light of the current fund balance
and future planning work that is underway
Attachment Staff Report Item 14F

Staff Report Item 15
Staff Report Item 15
To: Ava Community Energy Authority
From: Rusty Mills, Senior Vice President and Chief Financial Officer Subject:

Approval of a Resolution of the Board of Directors of Ava Community Energy Authorizing the Execution and Delivery of a Power Supply Contract or Power Supply Contracts and/or a Clean Energy Purchase Contract or Clean Energy Purchase Contracts and Certain Other Documents in Connection with the Issuance by the California Community Choice Financing Authority of Two Separate Series of Clean Energy Project Revenue Bonds, Series 2026; and Certain Other Actions in Connection Therewith
Date: June 17, 2026
__________________________________________________________________ Summary/Recommendation
Adopt a Resolution authorizing the execution and delivery of a Power Supply Contract or Power Supply Contracts and/or a Clean Energy Purchase Contract or Clean Energy Purchase Contracts and certain other documents in connection with the issuance by California Community Choice Financing Authority (“CCCFA”) of two separate series of Clean Energy Project Revenue Bonds, Series 2026; and certain other actions in connection therewith, to enable Ava to enter into its fourth and fifth energy prepayment transactions.

Staff Report Item 15
Ava has executed five prepay transactions in the past, including the first ever CCA prepay in 2021, and then subsequent transactions in 2022, 2023, and 2025. Many of the CCA’s in California have utilized this structure to provide discounted power and further enable a value proposition for CCA customers. The bonds have been sold through the California Community Choice Financing Authority (CCCFA) as a conduit issuer, which was initially set up to enable these transactions. The benefits provided to Ava and its customers are derived from the lower cost of funding from tax-exempt financing that is provided to the energy supplier than what they would receive from taxable markets and their own internal cost of capital. The project participant (e.g. Ava) commits to buying a commodity over a 30-year period and receives a discount on its contracted price throughout the term, lowering current and future energy costs. The commodity supplier often enters a separate funding agreement with a creditworthy third-party funding recipient, who receives a lower cost of funding benefit from the issuance and commits to make fixed payments that ultimately support the debt service of the underlying bonds.

After receiving updated proposals in the early Spring, Staff selected Morgan Stanley and Goldman Sachs as prospective banks for Ava’s 6th and 7th energy prepayment transactions.

Within each deal, the underwriting bank also serves as commodity supplier to CCCFA. Both firms have substantial CCA prepay execution experience and competitive cost structures. Ava has 4 existing energy prepayment transactions with Morgan Stanley and 1 existing transaction with Goldman Sachs. Entering additional transactions with these banks will allow Ava to realize efficiencies in transaction execution, ongoing operational efficiencies with staff time on monthly and annual reporting and compliance obligations, as well as pooling benefits that enable Ava to apply volumes from its long-term energy contracts across multiple transactions entered with the same energy supplies. While the transaction structures used with each bank are substantially similar, the use of two separate banks provides diversification and risk management benefits to Ava.

Staff will work with the underlying banks to select a funding recipient that optimizes savings to Ava, and enables a desirable maturity date to mitigate refinancing risk based on the current energy prepayment market refinancing calendars.

Additional information was presented to the Finance Administrative and Procurement Committee in May and the Executive Committee in June. Assuming the Board of Directors supports staff’s recommendation, the transaction will be presented to the CCCFA Board later in June for its approval before bond sales would occur.

The details of the requested Board approval are as follows: Adopt the Resolution which authorizes Ava to sign:
• Power Supply Contract with CCCFA (Issuer)
• Letter Agreement Regarding PPA Assignments with Morgan Stanley and Goldman Sachs (Prepay Suppliers) with Form of Limited Assignment Agreements with Morgan Stanley & Goldman Sachs and future PPA sellers
• Project Administration Agreement with CCCFA (Issuer)
Staff Report Item 15
• PPA Payment Custodial Agreements with Morgan Stanley and US Bank, & Goldman Sachs and US Bank
• Cost Share Memorandum of Understandings (MOUs), by and between Ava, CCCFA and the Prepaid Supplier; and
• Other related documents.

The approval provided shall be subject to the following parameters:
a) no more than two total prepayment transactions will be completed on behalf of Ava pursuant to the authorizations granted by the Resolution; b) the Bonds will not be obligations of Ava, but will be limited obligations of the Issuer payable solely from the revenues and other amounts pledged therefor under each Indenture, including amounts payable by Ava under the Power Supply Contract(s) and/or the Clean Energy Purchase Contract(s), respectively;
c) the aggregate principal amount of each series of Bonds shall not exceed $1,250,000,000 per series issued;
d) the “Monthly Discount” and “Minimum Discount” as provided for in a Power Supply Contract for any MS Project shall be at least 8.0% of the fixed cashflows or equivalent $ per MWh; and (e) the “Monthly Discount Percentage” as provided for in a Clean Energy Purchase Contract shall result in at least an average annual savings of 8.0% during the Initial Reset Period (as such term is defined in such Clean Energy Purchase Contract).

Financial Impact
The purpose of pursuing the prepay transaction is to achieve meaningful energy procurement cost savings. These transactions are targeting an 8-12% discount at the outset, which translates to approximately $4-6MM of annual savings. Ava has saved $34.3 million from 2022 through December 2025 on the energy purchased through the five prepays it has closed, and savings are now expected to average $22.5M annually for the next 5 years. With the addition of prepays 6 and 7, savings will be expected to rise to approximately $30-35 million annually on energy purchased over the next five years.

Most of the parties assisting Ava with the prepay will be paid from the proceeds of the prepay bonds. With that said, certain fees, such as rating agency fees and green bond designation fees, are not contingent on a successful prepay transaction closing. Ava negotiated to have the prepay supplier(s) split these costs with Ava if the deal does not close. To minimize this modest risk, Ava will only authorize these fees when necessary.

Additionally, it is important to note that the prepay transaction itself is non-recourse to Ava. 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 Ava’s JPA Agreement, and the debts, liabilities and obligations of CCCFA will not constitute debts, liabilities or obligations of Ava or any representative of Ava serving on the governing body of Ava.

Attachments
A. Resolution
Staff Report Item 15
B. Presentation
C. Prepaid Agreement with Morgan Stanley
D. Master Power Supply Agreement with Goldman Sachs
E. Power Supply Contract with Morgan Stanley
F. Clean Energy Purchase Contract with Goldman Sachs
G. Letter Agreement Regarding PPA Assignments - Morgan Stanley H. Letter Agreement Regarding PPA Assignments - Goldman Sachs I. Project Administration Agreement with Morgan Stanley J. Operational Services Agreement with Goldman Sachs
K. Trust Indenture
L. Re-pricing Agreements with Morgan Stanley
M. Re-pricing Agreements with Goldman Sachs
N. Preliminary Offering Statement (POS) for Prepay with Morgan Stanley O. Preliminary Offering Statement (POS) for Prepay with Goldman Sachs P. Ava Appendix A for inclusion in POS
Q. Form of Limited Assignment for Goldman Sachs
R. MOU for Cost Share with CCCFA and Morgan Stanley
S. MOU for Cost Share with CCCFA and Goldman Sachs
RESOLUTION 2026-[__]

A RESOLUTION OF THE BOARD OF DIRECTORS OF THE AVA COMMUNITY

ENERGY AUTHORIZING THE EXECUTION AND DELIVERY OF A POWER SUPPLY

CONTRACT OR POWER SUPPLY CONTRACTS AND/OR A CLEAN ENERGY

PURCHASE CONTRACT OR CLEAN ENERGY PURCHASE CONTRACTS AND

CERTAIN OTHER DOCUMENTS IN CONNECTION WITH THE ISSUANCE BY THE

CALIFORNIA COMMUNITY CHOICE FINANCING AUTHORITY OF TWO
SEPARATE SERIES OF CLEAN ENERGY PROJECT REVENUE BONDS, SERIES 2026;

AND CERTAIN OTHER ACTIONS IN CONNECTION THEREWITH
WHEREAS, Ava Community Energy (formerly East Bay Community Energy) (“Ava”) 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 Ava and parties to the Joint Powers Agreement (as defined below) in March of 2020. The City of Stockton, located in San Joaquin County, was added as a member of Ava and party to the Joint Powers Agreement in 2022. The County of Alameda was added as a member of Ava and party to the Joint Powers Agreement in 2024;
WHEREAS, pursuant to the provisions of the Act, Ava 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 Ava 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, Ava has determined that it is desirable to acquire long-term supplies of clean energy from the Issuer;
WHEREAS, Ava is requesting that the Issuer agree to enter into one or two transactions to (i) purchase certain quantities of clean energy from a Delaware limited liability company (the “Prepaid Supplier”) the sole member of which is Morgan Stanley Capital Group Inc., a Delaware corporation (“MSCG”) on a prepaid basis and to sell such clean energy to Ava, as described herein (the “MS Project”) and/or (ii) purchase certain quantities of clean energy from a Delaware limited liability company, the sole equity member of which is J. Aron & Company LLC, a New York limited liability company (the “Electricity Supplier”) on a prepaid basis and to sell such clean energy to Ava, as described herein (the “GS Project” and together with the MS Project, the “Projects”);
Attachment Staff Report Item 15A
2 WHEREAS, Ava has determined to authorize a total of two transactions, consisting of one MS Project and one GS Project or, in the alternative two MS Projects or two GS Projects;
WHEREAS, Ava is requesting that the Issuer finance the costs of the Projects with the proceeds of two separate series of its Clean Energy Project Revenue Bonds, Series 2026 (together, the “Bonds”);
WHEREAS, Ava has determined to authorize the officers of Ava 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 Ava for approval forms of the following agreements to which Ava is a party:

The following “MS Project documents”:

1. Power Supply Contract between Ava and the Issuer;

2. Letter Agreement among Ava, the Prepaid Supplier and MSCG regarding matters relating to Assignment Agreements with form of Limited Assignment Agreement, by and among Ava, the counterparty to the power purchase agreement described therein, and MSCG; and

3. Prepaid Energy Project Administration Agreement, by and between Ava and the Issuer;

4. Cost Share Memorandum of Understanding (MOU), by and between Ava, Morgan Stanley & Co. LLC and CCCFA, if necessary; and
The following “GS Project documents”:

1. Clean Energy Purchase Contract between Ava and the Issuer;

2. Letter Agreement between Ava and J. Aron regarding matters relating to Limited Assignment Agreements;

3. A form of Limited Assignment Agreement, by and among Ava, the counterparty to the power purchase agreement to be described therein, and J. Aron;

4. Clean Energy Project Operational Services Agreement, by and between Ava and the Issuer;

5. Cost Share Memorandum of Understanding (MOU), by and between Ava and CCCFA, if necessary; and
The MS Project documents and the GS Project documents collectively referred to herein as the “Ava Documents”.

Attachment Staff Report Item 15A
3 WHEREAS, there have also been made available to the Board of Directors of Ava forms of the following additional documents relating to the Projects:

1. Trust Indentures (the “Indentures”) each between the Issuer and the trustee to be named therein, providing for, among other things, the issuance of and security for the respective series of 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. Master Power Supply Agreement (the “Master Power Supply Agreement”) between the Issuer and the Electricity Supplier, providing for the delivery of the energy supply to the Issuer;

4. Re-Pricing Agreements (the “Re-Pricing Agreements”) between the Issuer and the Prepaid Supplier and Electricity Supplier, respectively, providing for the remarketing or refunding of the Bonds from time to time and the establishment of the Monthly Discount available to Ava under the Power Supply Contract and the Clean Energy Purchase Contract, respectively, from time to time during the term of the transactions; and

5. Preliminary Official Statements (the “Preliminary Official Statements”), to be used in connection with the offering and sale of the respective series of Bonds, including the information relating to Ava included in each Appendix A thereto (the Indentures, the Prepaid Agreement, the Master Supply Agreement, the Re-Pricing Agreements and the Preliminary Official Statements, together with the Ava Documents, the “Project Documents”);
NOW THEREFORE, BE IT RESOLVED by the Ava Board of Directors, as follows:

Section 1. The proposed forms of the Ava Documents, as made available to the Board of Directors for this meeting, are hereby approved. The forms of Limited Assignment Agreements may be used, in substantially the same form, for the initial assignments of Ava 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 agreements or as may be necessary to effect such assignment, and any such Limited Assignment Agreements shall be included in the Ava Documents hereby approved. Subject to the parameters set forth in Section 4 of this Resolution, any of the Chief Executive Officer, Chief Financial Officer or Chair of the Board (each an “Authorized Officer”) is hereby authorized and directed, for and on behalf of Ava, to execute and deliver the Ava 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 forms of the Preliminary Official Statements, as made available to the Board of Directors for this meeting, are hereby approved. Any Authorized Officer Attachment Staff Report Item 15A
4 is hereby authorized and directed, for and on behalf of Ava, to execute and deliver a certificate as to the information regarding Ava contained therein and in the final versions of the Official Statements, with such changes and insertions therein as the Authorized Officer approving the same may deem necessary or appropriate. Subject to approval by the Issuer, Ava hereby authorizes the distribution of the Preliminary Official Statements to persons who may be interested in the purchase of the Bonds, and the delivery of the Official Statements in final form to the purchasers of the respective 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 Ava, to execute and deliver any and all documents, including, without limitation, any tax certificates relating to its expected use of the energy to be purchased by it from the respective Project, any continuing disclosure certificates or similar agreements 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 Ava has approved in this Resolution, for the issuance, sale and delivery of the Bonds, and to consummate by Ava the transactions contemplated by the Ava 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) no more than two total prepayment transactions will be completed on behalf of Ava pursuant to the authorizations granted by this Resolution; (b) the Bonds will not be obligations of Ava, but will be limited obligations of the Issuer payable solely from the revenues and other amounts pledged therefor under each Indenture, including amounts payable by Ava under the Power Supply Contract(s) and/or the Clean Energy Purchase Contract(s), respectively;
(c) the aggregate principal amount of each series of Bonds shall not exceed $1,250,000,000 per series issued;
(d) the “Monthly Discount” and “Minimum Discount” as provided for in a Power Supply Contract for any MS Project shall be at least 8.0% of the fixed cash flows or equivalent $ per MWh; and
(e) the “Monthly Discount Percentage” as provided for in a Clean Energy Purchase Contract shall result in at least an average annual savings of 8.0% during the Initial Reset Period (as such term is defined in such Clean Energy Purchase Contract).

Section 5. Execution and delivery of the Ava 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.

Attachment Staff Report Item 15A
5 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 Ava in connection with the Projects. 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 Ava. Payment to these professionals will be made from the proceeds of the sale of the Bonds respectively and pursuant to the terms of the applicable agreements executed with Ava.

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 Ava 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
6 ADOPTED AND APPROVED at a regular meeting of the Ava Board of Directors on this 17th day of June, 2026.
______________________________________
Betsy Andersen, Chair
Attest:
___________________________________________
Adrian Bankhead, Clerk of the Board
Attachment Staff Report Item 15A
2026 Energy Prepayment
Transactions
Rusty Mills, CFO | June 17, 2026
Attachment Staff Report Item 15B
Energy Prepayment Financing Overview
2 • IRS Regulations codified in 2005 allow for tax-exempt debt to be issued for the prepayment of electricity to serve load.
• Tax-exempt debt (issued by CCCFA) provides a lower cost of funding than energy prepay financing participants would be able to receive by issuing taxable debt or internal funding. • Bond investor risk is tied to the energy prepay funding recipient (not Ava), and their ability to pay debt service and redeem bonds in event of default on the bonds. • Ava enters 30-year energy supply agreements, commits to purchasing a fixed volume of energy during that period, and receive a fixed $/MWh discount to the market energy price. • Objective: Prepay transactions enable Ava to lower its cost of energy on existing and future energy contracts through the discount and enable a customer value proposition into the future.

Goal: Reduce the cost of public power purchases by monetizing tax-exempt debt.

Attachment Staff Report Item 15B
2026 Prepay Financing Plans & Timeline
Staff is seeking approval for two prepayment transactions by the Board ▪ Each would be authorized for up to $1.25 billion, but likely would be approximately $1 billion, similar to prior Ava prepay deals
▪ We selected Morgan Stanley and Goldman Sachs as underwriter and supplier for one transaction each;
▪ Further optimizes each related PPA pool of resources with the existing banks ▪ Staff will seek Green Bond designations for both transactions ▪ Transactions would occur after approvals by Ava and CCCFA boards in June, subject to market conditions
▪ Selection of funding recipient will occur closer to pricing; Ava will seek Bond Ratings shortly after in preparation for each bond sale
3 May FAP
June
ExComm
June Ava
Board
June CCCFA
Board
Receive
Ratings/Mail POS
Price and Close
Prepay transactions
June 1 July 1 Aug 1
Attachment Staff Report Item 15B
Summary Of Ava Prepay Transactions
4 CCCFA 2021B CCCFA 2022A CCCFA 2023E CCCFA 2025C CCCFA 2025E Total Project Participant(s) Ava & SVCE Ava Ava Ava Ava N/A
Initial Bond Principal
Amount $1,234,720,000 $931,120,000 $997,895,000 $1,004,395,000 $960,730,000 $5,128,860,000 Delivery Period Start
Date 1/1/2022 4/1/2023 1/1/2024 11/1/2025 4/1/2026 N/A
Bond Refinancing Date 8/1/2031 8/1/2028 3/1/2031 10/1/2033 5/1/2035 N/A Total Discount to Ava
($/MWh) $4.28 $7.46 $12.66 $10.85 $13.30 $9.55/MWh
Initial Period Nominal
Energy Savings $21.4M $26.8M $49.6M $47.1M $56.5M $201.5M Initial Period Energy
Delivery (MWh) 5.0MM 3.59MM 3.92MM 4.34MM 4.25M 21.1M
# of Ava PPAs Currently
Assigned2 2.5 2.5 2 1 2 10
Ava’s transactions to date have resulted in over $5.1B in CCCFA bond issuances, with $/MWh discounts improving in more recent transactions driven largely by market conditions. 2Where a decimal is present, certain Ava PPAs have energy volume allocated on a pro rata basis across multiple prepayment transactions.

Attachment Staff Report Item 15B
Ava Energy Prepay Savings by Transaction
5 • Ava’s initial five prepay
transactions are expected to
provide $201.5M in energy
savings over the initial bond
periods.
• Average savings discount:
$9.55/MWh across ~21.1
TWh of Ava energy procured
through 2035.
• Annual savings of >$20M per
year from 2026-2030 from
the five existing prepays
$-
$5.0
$10.0
$15.0
$20.0
$25.0
$30.0
2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 Ava Annual Energy Savings1from Existing Prepay Transactions ($M) CCCFA 2021B CCCFA 2022A CCCFA 2023E CCCFA 2025C CCCFA 2025E 1 Annual energy savings above reflect total nominal expected discount to be received by Ava through the respective bond refinancing date.

Note: the savings decline in later years (2031-2035) above is a function of Ava’s existing transactions reaching their refinancing date on a rolling basis. At refinancing, Ava would issue a new bond and receive a new $/MWh discount for the duration of the bond.

Attachment Staff Report Item 15B
Potential for Future Prepay Transactions
6 • Under tax guidance, Ava’s aggregate load
committed to all energy prepayment transactions
should be limited to no more than 80% of total
expected load in any given year.
• Through 5 transactions: 34% of Ava’s forecasted
load is committed to energy prepayments in peak
years.
• After Prepays #6 & 7, 49% of Ava’s forecasted load
will be committed across all transactions.
• Following Prepay #7, Ava expects to have load
capacity headroom for 3-4 additional prepayment
transactions.
o This is subject to change based on actual volume commitments in forthcoming transaction and will be reviewed over time against Ava's long-term load forecast.

Energy prepayment load commitments as
% of Ava's expected load4

34.3%

14.5%

31.1%

20.0% Prepay #1-5 volume
Expected Prepay #6 & 7 volume
Headroom for future
transactions
Reserved per tax guidance
4Percentages in chart reflect expected
volumes for calendar year 2051, which is
the peak aggregate volume commitment
for Ava's existing energy prepayment
transactions.

Attachment Staff Report Item 15B
Summary & Request for Approval
• Prepays currently provide significant savings for Ava ~ $22.5 million annually oCould approach $40-50 million annually with more prepays • Budget Planning Risk- Perpetual savings uncertain due to broad structural risks • Staff recommends continuing to use prepays within legal guidance to maximize savings while monitoring budget risk over the mid-long-term Staff requests authorization to enter into all financing agreements necessary to price and close two prepay
transactions subject to the following parameters:
▪ No more than two total prepayment transactions will be completed ▪ The aggregate principal amount of each series of Bonds shall not exceed $1,250,000,000 per series issued; ▪ The “Monthly Discount” and “Minimum Discount” shall be at least 8.0% of the fixed cashflows ▪ The Bonds will be non-recourse and not be obligations of Ava 7 Attachment Staff Report Item 15B
Energy Prepayment Transaction Diagram
10 1. Bond Issuance: CCCFA issues the Bonds to
fund the prepayment.

2. Prepayment: CCCFA applies bond proceeds
to prepay Energy Supplier for 30 years of
energy deliveries.

3. Commodity swap: Energy Supplier enters
swap transaction at fixed price.

4. CCCFA commodity swap: CCCFA enters
commodity swap at same fixed price to de-risk variability of debt service.

5. Ava: Ava enters energy supply contract to
buy energy delivered by Energy Supplier at a
fixed discount to Ava’s energy contracts.

6. Funding Agreement: Energy Supplier
finances bond proceeds with third-party
funding recipient to enhance savings
potential.

7. Assigned PPAs: Ava assigns its existing and
future PPAs to Energy Supplier through a
custodial account. Energy Supplier
contributes pays and take title to underlying
PPA energy.

Ava
Energy Supplier
Affiliate
Attachment Staff Report Item 15B
Involved Prepay Parties
11 • Prepay Supplier/Bond Underwriter: Morgan Stanley/ Goldman Sachs, among others • Municipal Financial Advisor: PFM Financial Advisors LLC & PFM Swap Advisors LLC • Counsel: Orrick, Herrington & Sutcliffe (CCCFA Bond & Tax Counsel) | Chapman & Cutler LLP (Ava Bond Counsel); Sheppard Mullin (Supplier Counsel)
• Bond Issuer: California Community Choice Financing Authority • Trustee/Custodial Bank: US Bank
• Commodity Swap Counterparty: Natixis, RBC, BP among others • Credit Rating Agency: Moody’s Investor Service Inc
• Ava Prepay Funding Recipients: Morgan Stanley, Bank of Nova Scotia and American General Life Attachment Staff Report Item 15B
Prepay Structure Risks
12 Risk Description Mitigation
Market risks Macro factors (Iran, inflation, Fed rate decisions, etc.) may impact bond pricing and Ava savings potential of energy prepayment transactions.

Ava and PFM to coordinate closely with underwriters
on market timing to optimize execution.

Refinancing risk • Initital prepay bond savings periods are typically 5-10 years. • Each transaction must be re-financed at that time
• Future savings are subject to decrease/increased based on market conditions at refinancing.
• Energy prepayment transaction volume has meaningfully increased in past few years, so the refinancing market will have a higher supply in the coming years.

Ava to assess opportunities to stagger Ava transaction
refinancing dates to de-risk market and interest rate
conditions at re-financing.

Issuing transactions in 2026 may result in higher
savings than future years when new issuances
may compete with refinancings for the same bond
purchaser pool.

Load loss risk Material inability by Ava to deliver contracted MWh in future years may lead to loss of energy discount.

Ava limits its prepay-committed power relative to its
long-term load forecast. After Prepays #6 & 7,
approximately 49 % of Ava’s future load will be
committed to prepays.

Out of pocket costs Requires staff time to execute & manage; ratings agency and green bond fees are paid regardless of transaction’s success.

Fees are greatly outweighed by the savings potential.

Tax / regulatory risk Changes in tax law or RPS standards may impact energy prepayment transactions in the future and potentially cause existing deals to unwind.

Limited ability to mitigate.

Ava Planning Risk - Loss of discounted power would place some future budgetary pressure on Ava Attachment Staff Report Item 15B
Prepaid Energy Refinancing Risk
13 Over $95.6B of prepaid energy financings are coming due for refinancing by 2036, which may result in pressure on future bond pricing, energy discounts, and market access.

Attachment Staff Report Item 15B
Sheppard Draft 4 May 2026

PREPAID ENERGY SALES AGREEMENT
between
ENERGY PREPAY [__], LLC
and

CALIFORNIA COMMUNITY CHOICE FINANCING AUTHORITY
Dated as of [____], 2026
Attachment Staff Report Item 15C

TABLE OF CONTENTS
(continued)
Page
-i-Article I. Definitions..................................................................................................................... 1 Section 1.1 Defined Terms ..................................................................................... 1 Section 1.2 Definitions; Interpretation.................................................................. 11 Article II. Execution Date and Delivery Period ...................................................................... 12 Section 2.1 Execution Date; Delivery Period ....................................................... 12 Section 2.2 Termination by Seller Prior to Prepayment ....................................... 12 Article III. Sale And Purchase.................................................................................................. 12 Section 3.1 Sale and Purchase of Energy.............................................................. 12 Section 3.2 Prepayment ........................................................................................ 13 Section 3.3 Other Amounts Payable with Respect to Assigned Products ............ 13 Section 3.4 No Obligation to Take Base Energy .................................................. 13 Section 3.5 Reduction of Contract Quantity......................................................... 13 Article IV. Failure to Deliver or Take Energy ........................................................................ 14 Section 4.1 Assigned Product ............................................................................... 14 Section 4.2 Failure to Deliver or Take Due to Force Majeure.............................. 14 Article V. Transmission and Delivery; Communications ...................................................... 14 Section 5.1 Delivery of Energy............................................................................. 14 Section 5.2 Scheduling.......................................................................................... 15 Section 5.3 Title and Risk of Loss........................................................................ 15 Section 5.4 PCC1 Product, Long-Term PCC1 Product, and PCC2 Product ........ 15 Section 5.5 Deliveries within CAISO or Another Balancing Authority............... 18 Section 5.6 Assigned Products.............................................................................. 19 Article VI. Partial Assignments of PPAs ................................................................................. 19 Section 6.1 Future PPA Assignments................................................................... 19 Section 6.2 Updates to Exhibits A-1 and A-2....................................................... 19 Article VII. Energy Remarketing............................................................................................. 19 Section 7.1 Energy Remarketing .......................................................................... 19 Section 7.2 Delegation of Authority ..................................................................... 19 Article VIII. Representations and Warranties........................................................................ 20 Section 8.1 Representations and Warranties......................................................... 20 Attachment Staff Report Item 15C

TABLE OF CONTENTS
(continued)
Page
-ii-Section 8.2 Additional Representations and Warranties of Buyer ....................... 21 Section 8.3 Warranty of Title................................................................................ 22 Section 8.4 Funding Agreement. .......................................................................... 22 Section 8.5 Notice of PSC Remarketing Termination. ......................................... 23 Article IX. Taxes ........................................................................................................................ 23 Article X. Dispute Resolution.................................................................................................... 23 Section 10.1 Arbitration.......................................................................................... 23 Section 10.2 Dispute Resolution............................................................................. 24 Article XI. Force Majeure......................................................................................................... 26 Section 11.1 Applicability of Force Majeure.......................................................... 26 Section 11.2 Settlement of Labor Disputes............................................................. 26 Article XII. Governmental Rules and Regulations................................................................. 26 Section 12.1 Compliance with Laws ...................................................................... 26 Section 12.2 Contests.............................................................................................. 26 Section 12.3 Defense of Agreement ....................................................................... 27 Article XIII. Assignment ........................................................................................................... 27 Article XIV. Payments............................................................................................................... 28 Section 14.1 Monthly Statements........................................................................... 28 Section 14.2 Payment.............................................................................................. 29 Section 14.3 Payment of Disputed Amounts.......................................................... 29 Section 14.4 Late Payment ..................................................................................... 29 Section 14.5 Audit; Adjustments............................................................................ 29 Section 14.6 Netting................................................................................................ 30 Article XV. Receivables Purchases........................................................................................... 30 Article XVI. Notices................................................................................................................... 30 Article XVII. Acceleration; Termination; Remedies.............................................................. 31 Section 17.1 Acceleration Event............................................................................. 31 Section 17.2 Energy Delivery Termination Events. ............................................... 31 Section 17.3 Payments Following a Ledger Event. ................................................ 32 Section 17.4 Remedies and Termination. ............................................................... 32 Attachment Staff Report Item 15C

TABLE OF CONTENTS
(continued)
Page
-iii-Section 17.5 Replacement of Swaps....................................................................... 33 Section 17.6 Limitation on Damages...................................................................... 34 Section 17.7 Option to Purchase Bonds.................................................................. 35 Section 17.8 Termination Payment Adjustment Schedule ..................................... 35 Article XVIII. Miscellaneous .................................................................................................... 36 Section 18.1 Indemnification Procedure................................................................. 36 Section 18.2 Deliveries........................................................................................... 36 Section 18.3 Entirety; Amendments....................................................................... 36 Section 18.4 Governing Law .................................................................................. 37 Section 18.5 Non-Waiver........................................................................................ 37 Section 18.6 Severability ........................................................................................ 37 Section 18.7 Exhibits.............................................................................................. 37 Section 18.8 Winding Up Arrangements................................................................ 37 Section 18.9 Relationships of Parties...................................................................... 37 Section 18.10 Immunity............................................................................................ 38 Section 18.11 Rates and Indices ............................................................................... 38 Section 18.12 Limitation of Liability........................................................................ 39 Section 18.13 Counterparts....................................................................................... 39 Section 18.14 Rights of Trustee................................................................................ 39 Section 18.15 Waiver of Defenses............................................................................ 40 Section 18.16 U.S. Resolution Stay.......................................................................... 40 Section 18.17 Rate Changes ..................................................................................... 40 Section 18.18 No Recourse....................................................................................... 41 Exhibit A-1 - Base Energy Hourly Quantities
Exhibit A-2 - EPS Energy Period Monthly Projected Quantity Exhibit A-3 - Annual Quantity
Exhibit B - Notices
Exhibit C - Energy Remarketing
Exhibit D-1 - Termination Payment Schedule
Exhibit D-2 - Termination Payment Adjustment Schedule
Exhibit D-3 - Post Termination Payment Schedule
Exhibit E - Reserved
Exhibit F - Pricing and Other Terms
Attachment Staff Report Item 15C

TABLE OF CONTENTS
(continued)
Page
-iv-Exhibit G - Receivables Purchases
Attachment Staff Report Item 15C
1 PREPAID ENERGY SALES AGREEMENT
This Prepaid Energy Sales Agreement (hereinafter, this “Agreement”) is made and entered into as of [____], 2026 (the “Execution Date”), by and between Energy Prepay [__], LLC, a Delaware limited liability company (“Seller”), and 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) (“Buyer”).

W I T N E S S E T H:

WHEREAS, Seller desires to sell Energy to Buyer, and Buyer desires to purchase Energy from Seller, upon the terms and conditions hereinafter set forth; WHEREAS, in connection with the execution of this Agreement, Seller shall enter into that certain Energy Management Agreement, dated as of the date hereof (the “Energy Management Agreement”), with Morgan Stanley Capital Group Inc., a Delaware corporation (“MSCG”), pursuant to which Seller shall acquire Energy for delivery under this Agreement; and WHEREAS, in connection with Buyer’s execution of the Power Supply Contract (as defined below), the Project Participant (as defined below) under such Power Supply Contract will assign to MSCG pursuant to the Initial Assignment Agreement certain Assigned Rights and Obligations, including the right to receive Assigned Product, which Assigned Product will be resold by MSCG to Seller under the Energy Management Agreement, then resold by Seller to Buyer hereunder and then resold to the Project Participant under the Power Supply Contract.

NOW, THEREFORE, in consideration of the premises above and the mutual covenants and agreements herein set forth, Buyer and Seller (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:
“Acceleration Event” has the meaning specified in Section 17.1. “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.

Attachment Staff Report Item 15C
2 “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 Quantity” means, with respect to each Contract Year of the Delivery Period, the quantity (in MWh) of Assigned Product for such Contract Year as set forth on Exhibit A-3; provided that the Annual Quantity for any Contract Year shall be reduced by the aggregate amount of any quantities of Base Energy required to be remarketed under this Agreement for any given Contract Year.
“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 Paygo Quantity” means any Assigned Products delivered under this Agreement in excess of the Annual Quantity for any Contract Year. “Assigned PPA” has the meaning specified in the Participant Custodial Agreement. “Assigned PPA Index Adder” means the amount (in $/MWh) specified in Exhibit A-2 for each Month of the Delivery Period.
“Assigned Product” means, as applicable, PCC1 Product, Long-Term PCC1 Product, PCC2 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 Seller pursuant to any Assigned Rights and Obligations.
“Assigned Rights and Obligations” means a portion of the Project Participant’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. “Assignment Letter Agreement” means that certain Letter Agreement, dated as of the date hereof, by and among MSCG, Seller, Buyer and Project Participant. “Assignment Period” has the meaning specified in the applicable Assignment Agreement.
“Available Discount” has the meaning specified in the Re-Pricing Agreement. “Balancing Authority” has the meaning specified in the CAISO Tariff.

Attachment Staff Report Item 15C
3 “Base Energy” means Firm (LD) Energy to be delivered to an Energy Delivery Point.
“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 Documents” means this Agreement, the Power Supply Contract, the Bond Indenture and all other documents, agreements and instruments entered into or delivered by Buyer in connection with any of the foregoing or the transactions thereunder. “Bond Indenture” means (i) the Trust Indenture to be entered into prior to the commencement of the Delivery Period between Buyer 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 Buyer and the Trustee containing substantially the same terms as the Trust Indenture described in clause (i) and which is intended to replace the Trust Indenture described in clause (i) as of the commencement of such Interest Rate Period which follows. “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.
“Buyer” has the meaning specified in the preamble.
“Buyer Custodial Agreement” means that certain Custodial Agreement, dated as of the Bond Closing Date, by and among Swap Counterparty, Buyer, the Trustee and U.S. Bank Trust Company, National Association, as custodian as the same may be amended, modified or supplemented from time to time.
“Buyer Swap” means (i) the transaction confirmation entered into under the ISDA Master Agreement, dated as of the date hereof, between Buyer and the Swap Counterparty, and (ii) each replacement Buyer Swap entered into pursuant to Section 17.5. “Buyer’s Statement” has the meaning specified in Section 14.1(a). “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.

Attachment Staff Report Item 15C
4 “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.
“Call Option Notice” has the meaning specified in Exhibit G. “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. “[Clean Energy Project]” has the meaning specified in the Bond Indenture. “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 Index Price” means the index price specified on Exhibit A-1 with respect to the Hourly Quantity of Energy (which index prices may be Day-Ahead Market Price or Real-Time Market Price). “Contract Quantity” means (i) with respect to Assigned Energy, the Annual Quantity of Assigned Energy for each Contract Year of the Delivery Period; and (ii) with respect to Base Energy, the Hourly Quantity of Base Energy set forth in Exhibit A-1 for any Month, as such Exhibit A-1 shall be updated from time to time in accordance with Section 6.2. “Contract Year” means each period of 12 Months from January 1 until December 31 during the Delivery Period; provided that (x) the initial Contract Year shall be a pro-rated [#] ([#]) Month period from [_____], 20[__] until [_____], 20[__] and (y) the Annual Quantity for 2026 set forth in Exhibit A-3 reflects the pro-rated Annual Quantity for such [#] ([#]) Month period in 2026.
“Custodial Agreements” means the Buyer Custodial Agreement and the Seller Custodial Agreement.
“Daily Basis Differential” has the meaning specified in Section 18.11(a)(ii). “Daily Commodity Reference Price” means (A) the Day-Ahead Market Price, (B) the Day-Ahead Average Price or (C) the Real-Time Market Price.

Attachment Staff Report Item 15C
5 “Daily Replacement Index” has the meaning specified in Section 18.11(a)(ii). “Day-Ahead Average Price” means, for any Assigned Energy in any EPS Energy Period, the result of (i) (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 plus (ii) the Assigned PPA Index Adder for the relevant Month. As used in this definition, “Pricing Interval” means each 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.
“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 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” has the meaning specified in Exhibit F. “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). “Early Termination Payment Date” means the last Business Day of the first Month that commences after an Acceleration Event; provided that, in the case of an Acceleration Event due to a Failed Remarketing, the Early Termination Payment Date shall be the last Business Day of the then-current Interest Rate Period.
“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 Delivery Termination Date” means a date that occurs pursuant to Section

17.4(a) upon which the Delivery Period will end and Buyer’s and Seller’s respective obligations to receive and deliver Energy under this Agreement will terminate. “Energy Delivery Termination Event” has the meaning specified in Section 17.2. “Energy Management Agreement” has the meaning specified in the recitals.

Attachment Staff Report Item 15C
6 “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 the Project Participant can contract for and purchase in compliance with EPS requirements that are applicable to such Project Participant.
“EPS Energy Period” means the Initial EPS Energy Period and any subsequent Assignment Period established by future assignments of power purchase agreements consistent with the Assignment Letter Agreement.
“Execution Date” has the meaning specified in the preamble. “[Failed Remarketing]” has the meaning specified in the Bond Indenture. “FERC” means the Federal Energy Regulatory Commission and any successor thereto.
[“Final Maturity Date” has the meaning specified in the Bond Indenture.] 1 “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. In the absence of Force Majeure, the Party to which performance is owed shall be entitled to receive from the Party which failed to deliver/receive an amount determined pursuant to Article IV.
“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 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 Buyer’s markets; (ii) Buyer’s inability economically to use or resell any Energy purchased hereunder; (iii) the loss or failure of Seller’s supply except if such loss or failure results from curtailment by a Transmission Provider; or (iv) Seller’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 (or an upstream supplier with respect to Seller or the Project Participant with respect to Buyer) has contracted for firm transmission with such Transmission Provider for the Energy to be delivered to or received at the Energy 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) to the extent that (x) a PPA 1 NTD: Subject to review of draft Indenture.

Attachment Staff Report Item 15C
7 Supplier fails to deliver any Assigned Energy and claims force majeure with respect to such failure to deliver or (y) a PPA Supplier otherwise is unable to deliver any portion of the Annual Quantity due to an event that would be considered Force Majeure under this Agreement if it affected Seller directly, then such event shall be deemed to constitute Force Majeure in respect of Seller hereunder; and (II) to the extent that an Assignment Agreement is terminated early, such termination shall constitute Force Majeure with respect to Seller 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.
[“Funding Agreement” means initially that certain Funding Agreement, dated as of the date hereof by and between Seller and the Funding Recipient and any replacement funding agreement entered into for a subsequent Reset Period.]
2 “Funding Recipient” means initially New York Life Insurance Company, a life insurance company organized under the laws of the State of New York, or its successors to or permitted assignees under the Funding Agreement, and any other Person that becomes counterparty to Seller under a Funding Agreement for a subsequent Reset Period. “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) on the first day of 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 MW) 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 Assignment Agreement” means that certain Limited Assignment Agreement, dated as of the [Bond Closing Date], by and among the Project Participant, Initial PPA Supplier and MSCG, as from time to time amended, restated, supplemented or otherwise modified. “Initial EPS Energy Period” means the “Assignment Period” as defined in the Initial Assignment Agreement.
“Initial PPA Supplier” means [___], a [___].
“[Interest Rate Period]” has the meaning specified in the Bond Indenture, provided that if the Bonds are outstanding in two or more series with separate, concurrent and co-terminus Interest Rate Periods, “Interest Rate Period” shall mean all such Interest Rate Periods collectively. 2 NTD: Funding Agreement provisions subject to change based upon negotiated form of Funding Agreement.

Attachment Staff Report Item 15C
8 “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. “Ledger Event” has the meaning specified in Exhibit C.
“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, Seller or any successors thereto pursuant to any Assigned Rights and Obligations.
[“Mandatory Purchase Date” has the meaning specified in the Bond Indenture.] “Master Custodial Agreement” means that certain Master Custodial Agreement, dated as of the date hereof, by and among Seller, MSCG, Buyer and the Master Custodian, as the same may be amended, modified or supplemented from time to time. “Master Custodian” means The Bank of New York Mellon, a New York banking corporation, as custodian under the Master Custodial Agreement, and its successors as Master Custodian under the Master Custodial Agreement.
“Minimum Discount” has the meaning specified in the Power Supply Contract. “Month” means a calendar month. The term “Monthly” shall be construed accordingly.
“Monthly Excess Quantity” means, for any Month, the amount, if any, by which the total quantity (in MWh) of Assigned Product delivered under an Assigned PPA in such Month exceeds the Monthly Projected Quantity for such Assigned PPA such Month. “Monthly Projected Quantity” means, with respect to each Assigned PPA and each Month of the Assignment Period for each Assigned PPA, the quantity (in MWh) of Assigned Product for such Month as set forth on Exhibit A-2 for such Assigned PPA (as such Exhibit A-2 may be updated from time to time in accordance with Section 6.2). “Morgan Stanley” means Morgan Stanley, a Delaware corporation. “MSCG” has the meaning specified in the recitals.
“MWh” means megawatt-hour.
“Participant Custodial Agreement” means that certain Consolidated Custodial Agreement, dated as of May [7], 2026, by and among the Project Participant, Buyer, Morgan Stanley Energy Structuring, L.L.C., MSCG and the Participant Custodian. 3 3 NTD: To reference the Consolidated PPA Custodial Agreement to be executed in connection with Ava Trustee Replacement Project.

Attachment Staff Report Item 15C
9 “Participant Custodian” means U.S. Bank Trust Company, National Association. “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, Seller or any successors thereto pursuant to any Assigned Rights and Obligations. “PCC2 Product” means bundled renewable energy and RECs meeting the requirements of Portfolio Content Category 2 to be delivered to MSCG, Seller 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. “Portfolio Content Category 2” 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)(2), as may be amended from time to time or as further defined or supplemented by Law. “[Power Supply Contract]” has the meaning specified in the Bond Indenture. “PPA Supplier” means the Initial PPA Supplier and any subsequent supplier who enters into an Assignment Agreement consistent with the Assignment Letter Agreement. “PPT” means Pacific Prevailing Time.
“Prepayment” means the amount specified in Exhibit F.
“Prepayment Outside Date” means the date specified in Exhibit F. “Project Participant” means Ava Community Energy Authority, a joint powers authority and a community choice aggregator organized under the Laws of the State of California. “Provisional Payment” has the meaning specified in the Exhibit C. “PSC Remarketing Termination” means, with respect to the Power Supply Contract, that the Project Participant delivered a valid Remarketing Termination Notice (other than a Voided Remarketing Termination Notice) (as such terms are defined in the Power Supply Contract) in accordance with [Section 3.4(b)] of the Power Supply Contract. “Put Option Notice” has the meaning specified in Exhibit G. “[Rating Confirmation]” has the meaning specified in the Bond Indenture.

Attachment Staff Report Item 15C
10 “Re-Pricing Agreement” means the Re-Pricing Agreement, dated as of the Bond Closing Date, by and between Buyer and Seller.
“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.
“Remarketing Notice” has the meaning specified in Exhibit C. “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. “Repurchase Offer” has the meaning specified in Exhibit G. “Reset Period” means each “Reset Period” under the Re-Pricing Agreement. “RPS” means the renewable energy program and policies established by California State Senate Bills 1038 (2002), 1078 (2002), 107 (2008), X-1 2 (2011), 350 (2015), and 100 (2018) as codified in, inter alia, California Public Utilities Code Sections 399.11 through 399.31 and California Public Resources Code Sections 25740 through 25751, as such provisions are amended or supplemented from time to time.
“Schedule”, “Scheduled” or “Scheduling” means the actions of Seller, Buyer 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. “Seller” has the meaning specified in the preamble.
“Seller Custodial Agreement” means that certain Custodial Agreement, dated as of the Bond Closing Date, by and among Swap Counterparty, Seller, the Trustee and U.S. Bank Trust Company, National Association, a national banking association, as custodian, as the same may be amended, modified or supplemented from time to time.
“Seller Swap” means (i) the transaction confirmation entered into under the ISDA Master Agreement, dated as of the date hereof, by Seller and the Swap Counterparty, and (ii) each replacement Seller Swap entered into pursuant to Section 17.5. “Specified Discount” means the amount specified in Exhibit F. “Specified Fixed Price” means the amount specified in Exhibit F. “Specified Investment Agreement” means a guaranteed investment contract between the Trustee and a provider concerning the investment of funds in the [Debt Service Account] (as defined in the Bond Indenture).

Attachment Staff Report Item 15C
11 “Swap Counterparty” means (i) [____], a [___], and (ii) any other Person that becomes counterparty to Buyer under a Buyer Swap or to Seller under a Seller Swap, in each case pursuant to Section 17.5.
“Swap Replacement Period” has the meaning specified in Section 17.5(a). “Terminating Party” means any Party that has the right to terminate this Agreement pursuant to Article XVII.
“Termination Payment” means, with respect to any Early Termination Payment Date, the amount specified on Exhibit D-1 for the calendar month in which such Early Termination Payment Date occurs (as adjusted by any applicable Termination Payment Adjustment Amount specified on Exhibit D-2) without any set-off or netting of amounts then due from Buyer. “Termination Payment Adjustment Amount” means, with respect to any Early Termination Payment Date, the amount specified on Exhibit D-2 for the calendar month in which such Early Termination Payment Date occurs. For the avoidance of doubt, the Termination Payment Adjustment Amount for the period commencing on the Execution Date is zero (0). “Termination Payment Adjustment Schedule” means the schedule of Termination Payment Adjustment Amounts set forth in Exhibit D-2, as such exhibit may be populated and amended from time to time in accordance with Section 17.8. “Transaction Documents” has the meaning specified in Article XIII. “Transmission Provider(s)” means any entity or entities transmitting or transporting Energy on behalf of Seller or Buyer to or from an Energy Delivery Point. “Trustee” means U.S. Bank Trust Company, National Association, and its successors as Trustee under the Bond Indenture.
“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 non-limiting 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 Attachment Staff Report Item 15C
12 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
Section 2.1 Execution Date; Delivery Period. This Agreement shall become effective upon the Execution Date and, unless this Agreement is terminated early pursuant to Section 2.2, all of Seller’s and Buyer’s obligations under this Agreement shall be deemed to have been incurred upon the Execution Date. Unless this Agreement is terminated pursuant to Section

2.2, then, upon receipt of the Prepayment, the delivery of Energy under this Agreement shall commence and continue for the Delivery Period.

Section 2.2 Termination by Seller Prior to Prepayment. Seller shall have no obligation to perform under this Agreement unless and until it has received the Prepayment from Buyer pursuant to Section 3.2. In the event Seller has not received the Prepayment prior to noon local time in New York, New York on the Prepayment Outside Date, Seller shall have the right, until such Prepayment has been paid, to terminate this Agreement without any further obligation or liability of either Party; provided that, for the avoidance of doubt, in the event Seller so terminates, such termination shall be effective upon the Prepayment Outside Date regardless of whether Buyer tenders the Prepayment after Seller’s notice of termination but prior to the Prepayment Outside Date. For the avoidance of doubt, no Termination Payment shall be payable by Seller under any circumstances if this Agreement terminates pursuant to this Section 2.2.

ARTICLE III.

SALE AND PURCHASE
Section 3.1 Sale and Purchase of Energy.
(a) Seller agrees to sell and deliver or cause to be delivered to Buyer, and Buyer agrees to take or cause to be taken from Seller, in each case, on a Firm (LD) basis, the Contract Quantity pursuant to the terms and conditions set forth in this Agreement. Energy delivered to Buyer under this Agreement shall be re-delivered to the Project Participant on a floating price basis throughout the Delivery Period. The Parties acknowledge and agree that Seller’s delivery obligation for (i) Assigned Products will be measured on an annual basis and (ii) Base Energy will be measured on an Hourly basis, as reflected in the definition of Contract Quantity and further set forth in the terms of this Agreement.
(b) In recognition that Seller will have increased floating price payment obligations to the Swap Counterparty under the Seller Swap with respect to negatively priced Energy and the Swap Counterparty will have increased floating price payment obligations to Buyer under the Buyer Swap with respect to negatively priced Energy, the Parties acknowledge and agree that Seller shall have no payment obligations to Buyer with respect to negatively priced Energy.

Attachment Staff Report Item 15C
13 Section 3.2 Prepayment. Prior to the commencement of the Delivery Period, Buyer shall pay Seller for all Energy to be delivered during the Delivery Period in an amount equal to the Prepayment, and Seller shall accept the Prepayment as payment in full for all Energy to be delivered hereunder. Buyer shall pay the Prepayment in a single lump sum payment by wire transfer of immediately available funds to an account designated by Seller. In no event shall Buyer be entitled to any rebate or refund of the Prepayment, but nothing in this Section 3.2 shall limit Buyer’s rights under (i) Article IV for Seller’s failure to deliver Energy (whether or not excused), (ii) Article XVII upon early termination of this Agreement or (iii) Exhibit C with respect to remarketing of Energy in accordance therewith. In no event shall Buyer be required to pay the Prepayment unless and until the Bonds are issued in exchange for a purchase price sufficient to pay costs of issuance, to fund required reserves under the Bond Indenture (or purchase surety bonds or enter into any similar arrangements in lieu of funding such reserves), and to pay the Prepayment.

Section 3.3 Other Amounts Payable with Respect to Assigned Products. (a) With respect to Monthly Excess Quantities and Assigned Paygo Quantities delivered hereunder, Buyer shall pay Seller an amount equal to the quantity of such Monthly Excess Quantities and Assigned Paygo Quantities, as applicable, multiplied by the price specified for Assigned Product under the applicable Assignment Agreement(s); provided that the Parties acknowledge and agree that the Project Participant’s payment of the Retained Payment Amount (as defined in the Participant Custodial Agreement) shall be deemed to satisfy Buyer’s payment obligation hereunder with respect to any such Monthly Excess Quantities and Assigned Paygo Quantities. To the extent the Project Participant fails to pay any amounts when due under the Participant Custodial Agreement with respect to Monthly Excess Quantities or Assigned Paygo Quantities, Buyer shall promptly transfer the resulting Excess Receivables (as defined in Exhibit G) to Seller, and the transfer of such Excess Receivables shall satisfy Buyer’s payment obligation with respect thereto.
(b) After the Annual Quantity has been delivered for any Contract Year, Seller shall pay Buyer the Day-Ahead Average Price with respect to any remaining Monthly Projected Quantities for any such Contract Year.

Section 3.4 No Obligation to Take Base Energy. Notwithstanding anything to the contrary in this Agreement, Buyer shall not be required to purchase and receive any Base Energy hereunder, and Seller shall remarket any portion of the Contract Quantity that is Base Energy pursuant to the provisions of Exhibit C.

Section 3.5 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, Buyer and the [Calculation Agent] (as defined in the Bond Indenture) 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) the Delivery Period will be deemed to be modified so that it ends at the end of such Reset Period, Attachment Staff Report Item 15C
14 and (B) 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
Section 4.1 Assigned Product. Notwithstanding anything herein to the contrary, neither Seller nor Buyer shall have any liability or other obligation to one another under this Agreement for any failure to Schedule, take, or deliver Assigned Product other than as set forth in Section 5(a) of Exhibit C for any failure to Schedule, take or deliver Assigned Energy.

Section 4.2 Failure to Deliver or Take Due to Force Majeure. If with respect to all or any portion of the Contract Quantity of Base Energy:
(a) Buyer fails to take or Seller fails to deliver all or any portion of the Contract Quantity at any Delivery Point pursuant to the terms of this Agreement; and (b) such failure is due to Force Majeure claimed by either Party, then Seller shall pay to Buyer the result determined by the following formula with respect to each such Delivery Point:

P = Q x IP
Where:

P = The amount payable by Seller under this Section 4.2; Q = The quantity of Energy described in the lead-in to this Section 4.2; and
IP = With respect to Base Energy, the Contract Index Price applicable to such Delivery Hour and Energy Delivery Point for Base Energy.

The Parties acknowledge and agree that any failure to deliver the Annual Quantity of Assigned Energy, whether or not due to Force Majeure, is subject to the terms of Section 5(a) of Exhibit C.

ARTICLE V.

TRANSMISSION AND DELIVERY; COMMUNICATIONS
Section 5.1 Delivery of Energy.
(a) Assigned Product. 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.

Attachment Staff Report Item 15C
15 (b) Updates to Exhibits. Buyer and Seller may, upon mutual agreement, update Exhibit A-1 to modify the Delivery Points thereunder, provided that the Parties shall promptly notify the Swap Counterparty of any such updates and furthermore shall update the corresponding exhibits to the Buyer Swap and the Seller Swap in accordance with the terms thereof. Furthermore, following the Initial EPS Energy Period and thereafter in connection with the establishment, expiration or termination of any subsequent EPS Energy Period, the Parties shall update (i) the exhibits hereto in accordance with Section 6.2 and (ii) the exhibits to the Buyer Swap and the Seller Swap in accordance with the terms thereof. For the avoidance doubt, such updates will reflect that deliveries will be made to (A) the Energy Delivery Point at the Day-Ahead Market Price for any Base Energy and (B) an Assigned Delivery Point at the Day-Ahead Average Price for any Assigned Energy.

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

Section 5.3 Title and Risk of Loss. 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, Long-Term PCC1 Product, and PCC2 Product. To the extent that any Assigned Product is PCC1 Product, Long-Term PCC1 Product or PCC2 Product, the following provisions apply:
(a) Eligibility. Seller, and, if applicable, its successors, represents and warrants that throughout the Delivery Period of this Agreement that: (i) the Clean Energy Project qualifies and is certified by the CEC as an Eligible Renewable Energy Resource as such term is defined in Public Utilities Code Section 399.12 or Section 399.16; and (ii) the Clean Energy 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, any capitalized terms not otherwise defined herein shall have the meaning specified in the Assignment Agreement.
(b) Transfer of Renewable Energy Credits. Seller and, if applicable, its successors, represents and warrants that throughout the Delivery Period 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, any capitalized terms not otherwise defined herein shall have the meaning specified in the Assignment Agreement.

Attachment Staff Report Item 15C
16 (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, any capitalized terms not otherwise defined herein shall have the meaning specified in the Assignment 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]
(e) Seller Representations and Warranties.

Seller represents and warrants:
(i) Seller has the right to sell the Assigned Product from the Applicable Project;
(ii) Seller has not sold the Assigned Product or any REC or other attributes of the Assigned Product to be transferred to Buyer to any other person or entity;
(iii) the Energy component of the Assigned Product produced by the Applicable Project and purchased by Seller for resale to Buyer hereunder is not being sold by Seller back to the Applicable Project or PPA Supplier;
(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) Seller will deliver to Buyer all Assigned Energy and associated RECs generated by the Applicable Project for PCC1 Product in compliance with the requirements set forth in California Public Utilities Code Section 399.16(b)(1) and the California RPS compliance requirements for Portfolio Content Category 1 as set forth in CPUC Decision 11-12-052, if applicable;
(vii) Seller will deliver to Buyer all Assigned Energy and associated RECs generated by the Applicable Project for PCC2 Product in compliance with the requirements set forth in California Public Utilities Code 399.16(b)(2) and the California RPS compliance requirements for Portfolio Content Category 2 as set forth in CPUC Decision 11-12-052, if applicable;
(viii) Seller will deliver to Buyer all Assigned Energy and associated RECs generated by the Applicable Project for Long-Term PCC1 Attachment Staff Report Item 15C
17 Product in compliance with the California Long-Term Contracting Requirements, if applicable;
(ix) the Assigned Product supplied to Buyer 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
(x) Seller will cooperate and work with Buyer, the CEC, and/or the CPUC to provide any documentation required by the CPUC or CEC to support the Product’s classification as Portfolio Content Category 1 or Portfolio Content Category 2, as applicable, as set forth in California Public Utilities Code Sections 399.16(b)(1) or 399.16(b)(2), as applicable, and compliance with the California Long-Term Contracting Requirements, if applicable.

Seller further represents and warrants to Buyer that, to the extent that the PCC1 Product sold by Seller is a resale of part or all of a contract between Seller and one or more third parties, Seller 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 Buyer 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.

Seller further represents and warrants to Buyer that, to the extent that the PCC2 Product sold by Seller is a resale of part or all of a contract between Seller and one or more third parties, Seller represents, warrants and covenants that the resale complies with the following conditions in (i) through (v) 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)(2);
(ii) this Agreement transfers only electricity and RECs that have not yet been generated prior to the Assignment Period;
Attachment Staff Report Item 15C
18 (iii) this Agreement transfers the original arrangement for substitute electricity (e.g., source and quantity);
(iv) this Agreement retains the scheduling of the substitute electricity into a California balancing authority as set out in the original firming and shaping transaction; and
(v) this Agreement continues to provide incremental electricity scheduled into a California balancing authority.
(f) Subsequent Changes in Law. In the event that the qualifications or requirements of the RPS program, PCC1 Product, PCC2 Product, or the California Long-Term Contracting Requirements change, Seller shall take commercially reasonable actions to meet the amended qualifications or requirements of the RPS Law, PCC1 Product, PCC2 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, PCC2 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) Seller has relied exclusively upon the representations and warranties of each respective seller set forth in the Assignment 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) Seller agrees that it will 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; (iii) Buyer 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 Buyer shall have no other recourse against Seller or remedies under this Agreement; and
(iv) Section 5.4(d) shall only apply to the provisions of this Section 5.4 and all other provisions of this Agreement shall remain subject to and interpreted in accordance with Section 18.4.

Section 5.5 Deliveries within CAISO or Another Balancing Authority. The Parties acknowledge that Energy delivered by Seller 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 Balancing Authority shall constitute delivery of such Energy to Buyer; provided that, any Assigned Products associated with such Energy are also delivered to Buyer hereunder.

Attachment Staff Report Item 15C
19 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.

ARTICLE VI.

PARTIAL ASSIGNMENTS OF PPAS
Section 6.1 Future PPA Assignments. Subsequent to the Initial EPS Energy Period, the Project Participant, Seller, Buyer and MSCG shall cooperate to obtain EPS Compliant Energy for delivery hereunder in accordance with the Assignment Letter Agreement.

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 of an EPS Energy Period or (ii) the expiration of an EPS Energy Period, the Parties shall update (A) Exhibit A-1 to reflect an increase in the Hourly Quantities of Base Energy and (B) Exhibit A-2 to reflect a decrease in the Monthly Projected Quantities associated with the relevant Assigned PPA, in each case, in an amount equal to the Assigned Energy associated with the EPS Energy Period that terminated or expired. For the avoidance of doubt, any updates to Exhibits A-1 and A-2 due to an early termination of an EPS Energy Period shall be effective as of the earlier of (1) the commencement of an “Assignment Period” under a replacement Assignment Agreement or (2) the start of the third Month following the Month in which such early termination occurs. (b) In connection with the execution of any subsequent Assignment Agreement, the Parties shall update Exhibits A-1 and A-2 to reflect (i) appropriate decreases in the Hourly Quantities of Base Energy and increases in the Monthly Projected Quantities of Assigned Energy and (ii) any other changes in connection therewith.

ARTICLE VII.

ENERGY REMARKETING
Section 7.1 Energy Remarketing. If (a) the Project Participant is in default under the Power Supply Contract or does not require or is unable to receive all or any portion of the Energy purchased by Buyer under this Agreement as a result of (i) the Project Participant’s decreased Energy requirements, (ii) decreased demand by the Project Participant’s retail customers and its request that such Energy be remarketed or (iii) EPS Compliant Energy not being available for delivery hereunder; or (b) a quantity of Assigned Energy less than the Annual Quantity is delivered hereunder in any Contract Year for any reason other than Force Majeure, then Buyer shall request (and pursuant to Exhibit C may be deemed to request) remarketing services from Seller pursuant to the provisions of Exhibit C.

Section 7.2 Delegation of Authority. Buyer hereby acknowledges and agrees that Seller shall delegate its rights and obligations under Exhibit C to MSCG pursuant to the Energy Management Agreement.

Attachment Staff Report Item 15C
20 ARTICLE VIII.

REPRESENTATIONS AND WARRANTIES
Section 8.1 Representations and Warranties. 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) it is duly organized and validly existing under the Laws of the state in which it is organized;
(b) 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; (c) 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 hereof, any action taken or to be taken by such Party pursuant hereto, or any of the transactions contemplated hereby;
(d) 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; (e) 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; (f) 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;
(g) 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 Buyer, the lien of the Bond Indenture;
(h) 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 Attachment Staff Report Item 15C
21 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
(i) 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 Additional Representations and Warranties of Buyer. As a material inducement to entering into this Agreement, Buyer hereby represents and warrants to Seller as of the Execution Date as follows:
(a) Buyer is entering into this Agreement for the purpose of acquiring Energy for sale to the Project Participant pursuant to the Power Supply Contract; (b) any amounts payable by Buyer under this Agreement shall (i) other than the Prepayment, be payable as an item of Operating Expense under (and as defined in) the Bond Indenture, and (ii) not constitute an indebtedness or liability of Buyer within the meaning of any constitutional or statutory limitation or restriction applicable to Buyer; (c) Buyer will promptly alert Seller of any notice received by Buyer alleging a breach under the Bond Indenture or of any covenant of Buyer in the agreements entered into by Buyer in connection with the Clean Energy Project;
(d) Buyer shall not (i) enter into any Bond Documents (excluding any contracts applicable to Energy being resold by Buyer or the Project Participant (or a related joint powers authority selling Energy to the Project Participant)), (ii) consent to, waive or agree to or permit any material amendment to or rescission of any such Bond Documents or (iii) consent to, waive or agree to permit any amendment (whether or not material) to or rescission of the Bond Indenture, in each case, without the prior written consent of Seller; (e) Buyer shall collect and forthwith cause to be deposited in the relevant funds pursuant to the Bond Indenture all amounts payable to it pursuant to the Power Supply Contract. Buyer shall enforce the provisions of the Power Supply Contract, as well as any other contract or contracts entered into relating to the Clean Energy Project, and duly perform its covenants and agreements thereunder. Buyer shall not consent or agree to or permit any termination or rescission of or amendment to or otherwise take any action under or in connection with the Power Supply Contract which will impair the ability of Buyer to pay all of its debts and obligations as they come due; provided that this provision shall not prevent Buyer from otherwise taking any action under or in connection with the Power Supply Contract which is expressly permitted pursuant to the provisions thereof. A copy of the Power Supply Contract and any amendment thereto certified by an authorized officer of Buyer shall be provided to Seller. Buyer shall not enter into any new Power Supply Contract following the Bond Closing Date without the prior written consent of Seller;
(f) Buyer shall keep or cause to be kept with respect to the Clean Energy Project, proper books of record and account (separate from all other records and accounts) in Attachment Staff Report Item 15C
22 accordance with generally accepted accounting principles, as such may be modified by the provisions of the Bond Indenture, in which complete and correct entries shall be made of its transactions relating to the Clean Energy Project, the amount of revenues and the application thereof and each fund and account established under the Bond Indenture and relating to its costs and charges under the Power Supply Contract and any other contracts for the sale or purchase of Energy, and which, together with all contracts and all other books and papers of Buyer relating to the Clean Energy Project, shall, subject to the terms thereof, at all times during regular business hours be subject to the inspection of Seller;
(g) Buyer shall from time to time duly pay and discharge, or cause to be paid and discharged, all taxes, assessments and other governmental charges, or required payments in lieu thereof, lawfully imposed upon the properties of Buyer or upon the rights, revenues, income, receipts, and other moneys, securities and funds of Buyer when the same shall become due, and all lawful claims for labor and material and supplies, except those taxes, assessments, charges or claims which Buyer shall in good faith contest by proper legal proceedings if Buyer shall in all such cases have set aside on its books reserves deemed adequate by Buyer with respect thereto; (h) Buyer shall at all times maintain its existence and shall do and perform or cause to be done and performed all acts and things required to maintain its existence; and (i) Buyer shall not consolidate or amalgamate with, or merge with or into, or transfer all or substantially all its assets to, or reorganize, reincorporate or reconstitute into or as, another entity unless (i) prior to such event, Buyer receives confirmation from Seller that such event does not trigger a termination event under this Agreement or the Buyer Swap and (ii) at the time of such consolidation, amalgamation, merger, transfer, reorganization, reincorporation or reconstitution, the resulting, surviving or transferee entity assumes all the obligations of Buyer under this Agreement and the Buyer Swap.

Section 8.3 Warranty of Title. Seller 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 Buyer, free and clear of all liens, encumbrances, and claims. EXCEPT FOR

THE WARRANTIES EXPRESSLY MADE BY SELLER IN THIS ARTICLE VIII, SELLER

HEREBY DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING

ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

Section 8.4 Funding Agreement.
(a) Except (i) to cure any ambiguity, supply any omission, or cure or correct any defect or inconsistent provision in the Funding Agreement, (ii) to insert such provisions clarifying matters or questions arising under the Funding Agreement as are necessary or desirable and are not contrary to or inconsistent therewith, (iii) to convert or supplement any provision in a manner consistent with the intent of the Funding Agreement and the other Transaction Documents or (iv) for any transfer of the Funding Agreement to MSCG pursuant to [Section 17.6(a)] of the Energy Management Agreement, Seller agrees that it shall not agree to any amendment, alteration, modification, assignment, sale or transfer of the Funding Agreement without receipt of (A) a Rating Confirmation and (B) the prior written consent of Buyer, no such consent of Buyer shall be Attachment Staff Report Item 15C
23 required in connection with the replacement, refinancing or re-pricing of the Funding Agreement at the end of any Interest Rate Period in accordance with the terms of the Funding Agreement. (b) Upon the occurrence of an [Event of Default] (as defined in the Funding Agreement), Seller shall (i) exercise any right it has pursuant to [Section 2.2 (Termination for an Event of Default)] of the Funding Agreement to designate an early termination thereof and make a written demand for payment of the Redemption Amount (as defined therein) and (ii) exercise Commercially Reasonable Efforts to recover amounts due thereunder. Additionally, Seller agrees that it shall not designate an [Early Redemption Date] under the Funding Agreement (and thereby cause payment of the Redemption Amount) unless such case the Redemption Amount together with other available funds, is sufficient to pay the amounts required for the early redemption of the Bonds.

Section 8.5 Notice of PSC Remarketing Termination. Seller covenants and agrees that it shall provide prompt notice to MSCG if the Project Participant makes a PSC Remarketing Termination for any Reset Period.

ARTICLE IX.

TAXES
Seller 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 Points, and (ii) indemnify Buyer and its Affiliates for any such taxes paid by Buyer or its Affiliates. Buyer shall (x) be responsible for all such taxes assessed at or downstream of the Delivery Points, and (y) indemnify Seller and its Affiliates for any such taxes paid by Seller 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 (3) 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 Attachment Staff Report Item 15C
24 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, 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 Dispute Resolution.
(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 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 referees (the “Party-Appointed Referees”) shall appoint a third referee (the “Third Referee”, together with the Attachment Staff Report Item 15C
25 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 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) 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 Attachment Staff Report Item 15C
26 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.
(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.

Attachment Staff Report Item 15C
27 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 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
Neither Party shall assign this Agreement or any of its rights or obligations under this Agreement without the prior written consent of the other Party; provided, however, that:
(a) pursuant to the Bond Indenture, Buyer may, without the consent of Seller, transfer, sell, pledge, encumber or assign this Agreement to the Trustee in connection with any financing or other financial arrangements; provided that Buyer shall not assign this Agreement unless, contemporaneously with the effectiveness of such assignment, Buyer also assigns the Buyer Swap (and the Buyer Custodial Agreement) to the same assignee; (b) upon written notice to Buyer, Seller may, without Buyer’s consent, assign this Agreement to an Affiliate of Seller which assignment shall constitute a novation; provided that, Seller shall not assign this Agreement unless (i) Seller delivers a Rating Confirmation to Buyer with respect to such assignment, (ii) contemporaneously with the effectiveness of such assignment, Seller also assigns the Seller Swap, the Seller Custodial Agreement and the Master Custodial Agreement to the same assignee and either (A) Seller assigns the Funding Agreement and Energy Management Agreement to the same assignee or (B) the assignee provides to Buyer a guarantee of its obligations by Morgan Stanley, and (iii) the assignee is a special purpose entity approved by Buyer or its obligations under this Agreement are guaranteed or otherwise supported by (A) Morgan Stanley or (B) a Funding Recipient to the satisfaction of Buyer; and (c) if either (A) Seller notifies Buyer that the Funding Agreement will not be replaced, refinanced or re-priced as of the end of any Interest Rate Period, (B) Seller is unable to provide, under the Re-Pricing Agreement, an Estimated Available Discount (as defined in the Re-Pricing Agreement) that is equal to or greater than the Minimum Discount under the Power Supply Contract, or (C) both (1) Seller has agreed under the Re-Pricing Agreement to provide an Available Discount equal to or greater than the Minimum Discount but for a Reset Period shorter than the entire remaining term to maturity of this Agreement and (2) Buyer has identified a potential assignee that has agreed to provide an Available Discount equal to or greater than the Minimum Discount for a Reset Period equal to the entire remaining term to maturity of this Agreement then, at the request of Buyer, Seller will reasonably cooperate with Buyer to cause Seller’s (or Seller’s Affiliate’s, if applicable) right, title and interest in this Agreement, the Re-Pricing Agreement, the Seller Swap, the Seller Custodial Agreement and any Specified Investment Agreement with a term that extends past the then-current Interest Rate Period to which Seller or any Affiliate is a party and all agreements related to any of the foregoing (the “Transaction Documents”) to be novated to a replacement seller; provided that (x) a Rating Confirmation is obtained for any Bonds required to be redeemed on the first [Mandatory Purchase Date] following the effective date of such Attachment Staff Report Item 15C
28 novation, (y) the Swap Counterparty shall have provided its prior written consent to such assignment in accordance with the terms of the Seller Swap, and (z) after giving effect to such novation, Seller will not have any obligations (contingent or otherwise, including any obligation to make or repeat any representations or warranties other than basic representations on authority and the right to transfer its rights, title and interests under this Agreement without encumbrances) or be required to make any payment under any Transaction Document or otherwise in connection with or following such novation other than any obligations that would have existed or payments that would have been required had this Agreement terminated as of the end of the last Reset Period that commenced prior to such novation.

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, Buyer shall deliver to Seller a statement (a “Buyer’s Statement”) listing any other amounts due to Buyer 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”), Seller shall deliver a statement (a “Billing Statement”) to Buyer and each of the Parties to the Participant Custodial Agreement indicating (i) the total amount due to Buyer, if any, under Article IV, Article V, Article VII and Exhibit C with respect to the prior Month(s), (ii) any amounts due to Seller in connection with this Agreement with respect to the prior Month(s), and (iii) the net amount due to Buyer or Seller; provided that invoicing for Monthly Excess Quantities and Assigned Paygo Quantities shall occur under the Participant Custodial Agreement. If a Participant Monthly Statement (as defined in the Participant Custodial Agreement) for an Assigned PPA has not been delivered by the 10th day of the Month following deliveries, Seller shall provisionally prepare or cause to be prepared a Billing Statement for this Agreement that assumes all of the Monthly Projected Quantities were delivered under the applicable Assigned PPA for such Month, and any subsequent resettlements required with respect thereto shall occur under the Participant Custodial Agreement. As set forth in Section 5(a) of Exhibit C, in any Billing Statement that Seller delivers that reflects a Provisional Payment due, Seller shall indicate (x) the total amount of any Provisional Payment due for such Month and (y) the portion of such Provisional Payment that reflects the Net Participant Price that would otherwise be payable with respect thereto. The Parties acknowledge and agree that all amounts owed to and from Seller in connection with the Clean Energy Project shall be paid pursuant to the Master Custodial Agreement, and the Billing Statement may be provided by MSCG, as Seller’s agent, in the form of a consolidated statement regarding all amounts owed to and from Seller in connection with the Clean Energy Project for each Month, including payments to be made under this Agreement, the Funding Agreement, the Energy Management Agreement and the Seller Swap. (c) Upon request by either Party, the other Party shall deliver such supporting documentation of the foregoing as such requesting Party may reasonably request.

Attachment Staff Report Item 15C
29 Section 14.2 Payment.
(a) If the Billing Statement indicates an amount due from Buyer, then Buyer shall remit such amount to Seller by wire transfer (pursuant to Seller’s instructions), in immediately available funds, on or before the later of (i) the 25th day of the Month following the most recent Month to which such Billing Statement relates, or (ii) the 10th day following Buyer’s receipt of Seller’s Billing Statement, or if either such day is not a Business Day, the following Business Day. If the Billing Statement indicates an amount due from Seller, then Seller shall remit such amount to Buyer by wire transfer (pursuant to the Trustee’s instructions for payments due under this Agreement, provided that amounts due from Seller under Section 5(a) of Exhibit C shall be paid to the Provisional Payments Account under and as defined in the Participant Custodial Agreement), in immediately available funds, on or before the later of (i) the 24 th day of the Month
following the most recent Month to which such Billing Statement relates, or (ii) the 10th day following Seller’s receipt of Buyer’s Statement, or if either such day is not a Business Day, the preceding Business Day.
(b) If Buyer fails to issue a Buyer’s Statement with respect to any Month, Seller shall not be required to estimate any amounts due to Buyer for such Month, provided that Buyer may include any such amount on subsequent Buyer’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 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. If Seller disputes any amounts included in the Buyer’s Statement, Seller shall (a) (except in the case of manifest error) nonetheless calculate the Billing Statement based on the amounts included in Buyer’s Statement and (b) 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 Seller may have; provided, however, that Seller shall have the right, after payment, to dispute any amounts included in a Buyer’s Statement or otherwise used to calculate payments due under this Agreement pursuant to Section 14.5(b). If Buyer disputes any amounts included in the Billing Statement, Buyer 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.

Section 14.4 Late Payment. If a Party owing a net payment under Section 14.2 fails to remit the full amount payable 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.

Attachment Staff Report Item 15C
30 (b) Each Buyer’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 Buyer’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 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 incorrect Buyer’s Statements or Billing Statements shall bear interest at the Default Rate from the date such payment was made. Buyer shall cause the Project Participant to comply with the provisions of Section 14.5(a) to the extent necessary to allow Seller to verify any amounts due under this Agreement.

Section 14.6 Netting. 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, Seller shall not be entitled to net (i) any amounts that are in dispute or (ii) any payments due to Seller against (A) the Termination Payment if it becomes due, or (B) any payments due from Seller pursuant to Article IV, Article V or Exhibit C.

ARTICLE XV.

RECEIVABLES PURCHASES
In accordance with the provisions of Exhibit G, Buyer shall put and Seller shall purchase certain Put Receivables (as defined in Exhibit G) from Buyer relating to payment defaults by the Specified Project Participant (as defined in Exhibit G).

ARTICLE XVI.

NOTICES
Any notice, demand, or request required or authorized by this Agreement to be given by one Party to another 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 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.

Attachment Staff Report Item 15C
31 ARTICLE XVII.

ACCELERATION; TERMINATION; REMEDIES
Section 17.1 Acceleration Event. Each of the following events shall constitute an “Acceleration Event” under this Agreement:
(a) The acceleration of the Funding Recipient’s payment obligations under the Funding Agreement pursuant to [Section 2.2 (Termination for an Event of Default)] of the Funding Agreement due to the occurrence of an [Event of Default] (as defined in the Funding Agreement); (b) Seller is unable to replace, refinance or re-price the Funding Agreement for any Reset Period by the date that is one week prior to the beginning of the first Month following a Reset Period;
(c) MSCG designates an “Early Termination Date” under the Energy Management Agreement due to the Project Participant making a PSC Remarketing Termination; (d) MSCG purchases the Funding Agreement from Seller pursuant to [Section

17.6(a)] of the Energy Management Agreement following the occurrence of a Ledger Event; or (e) a Failed Remarketing occurs.

Section 17.2 Energy Delivery Termination Events. Each of the following events shall constitute an “Energy Delivery Termination Event” under this Agreement:

Termination
Related to:

Energy Delivery
Termination Event:
(a) Ledger Event The occurrence of a Ledger Event.
(b) Termination
of Energy
Management
Agreement and
Failure to
Replace MSCG
Both (A) an “Early Termination Date” occurs under the Energy Management Agreement, and (B) Seller is unable to enter into a replacement Energy Management Agreement by the date that is 120 days following such Early Termination Date under the Energy Management Agreement (provided that, for the avoidance of doubt, Seller may only enter into such a replacement Energy Management Agreement if Seller delivers a Rating Confirmation to Buyer with respect to its entry into such replacement Energy Management Agreement).
(c) Termination
of a Buyer Swap
Both (A) an Early Termination Date (as defined in the Buyer Swap) is designated pursuant to the terms of the Buyer Swap for any reason or occurs automatically pursuant to the terms of the Buyer Swap based on an Event of Default or Termination Event (as each term is defined in the Buyer Attachment Staff Report Item 15C
32 Termination
Related to:

Energy Delivery
Termination Event:

Swap), and (B) either the Seller Swap or the Buyer Swap is not replaced within the Swap Replacement Period.
(d) Termination
of a Seller Swap
Both (A) an Early Termination Date (as defined in the Seller Swap) is designated pursuant to the terms of the Seller Swap for any reason or occurs automatically pursuant to the terms of the Seller Swap based on an Event of Default or Termination Event (as each term is defined in the Seller Swap), and (B) either such Seller Swap or the Buyer Swap is not replaced within the Swap Replacement Period.

Section 17.3 Payments Following a Ledger Event. If a Ledger Event occurs and MSCG has not purchased the Funding Agreement pursuant to [Section 17.6(a)] of the Energy Management Agreement, then Seller shall pay to Buyer any amounts paid by MSCG to Seller pursuant to [Section 17.6(b)] of the Energy Management Agreement, which amounts will accrue from the first day of the Month following the Month during which a Ledger Event occurs until (but not including) the earlier of (a) an Early Termination Payment Date or (b) the [Initial Mandatory Purchase Date] (as defined in the Bond Indenture); provided that the Parties acknowledge and agree that such amounts shall not accrue for any Month in which an Early Termination Payment Date has been designated as a result of MSCG’s purchase of the Funding Agreement pursuant to [Section 17.6(a)] of the Energy Management Agreement.

Section 17.4 Remedies and Termination.
(a) Acceleration Event and Delivery Period Termination. An Energy Delivery Termination Date shall occur automatically upon the date of the occurrence of an Acceleration Event or an Energy Delivery Termination Event. As of the Energy Delivery Termination Date, (i) the Delivery Period shall end, (ii) the obligation of Seller to make any further deliveries of Energy to Buyer under this Agreement shall terminate and shall be replaced with a continuing obligation to make payment of the amounts set forth in Exhibit D-3 to Buyer until the earlier of (A) the Month in which an Early Termination Payment Date occurs and (B) the last due date for such payments under Exhibit D-3, and (iii) the obligation of Buyer to receive deliveries of Energy from Seller under this Agreement shall terminate. For the avoidance of doubt, (i) except as set forth in this Section 17.4(a), this Agreement will continue past an Energy Delivery Termination Date, and (ii) an Acceleration Event may arise contemporaneously with an Energy Delivery Termination Date or at any time thereafter and the occurrence of an Energy Delivery Termination Date shall not prevent the occurrence of an Acceleration Event. (b) Early Termination Payment Date. Following an Acceleration Event, Seller shall (i) promptly notify the Master Custodian of the Early Termination Payment Date and (ii) pay the Termination Payment to the Trustee on the Early Termination Payment Date pursuant to payment instructions issued by Buyer or, in the absence of such instructions, by wire transfer.

Such amounts shall be paid together with interest thereon (before as well as after judgment) from (and including) the Early Termination Payment Date to (but excluding) the date such amount is paid, at the Default Rate. The Parties acknowledge that it is impractical and difficult to assess Attachment Staff Report Item 15C
33 actual damages as a result of a termination of the Delivery Period under this Agreement, and the Parties therefore agree that the payment of the Termination Payment or the continued payment of amounts specified in Exhibit D-3, as applicable, is a fair and reasonable pre-estimate of the actual damages that would be incurred by Buyer as a result of termination of the Delivery Period under this Agreement for any reason and is not a penalty. The obligation of Seller to pay the Termination Payment on the Early Termination Payment Date is unconditional, irrespective of the validity or enforceability of this Agreement or any other agreement contemplated hereby, any waiver or consent by Buyer or any other circumstances that might otherwise constitute a legal or equitable discharge of Seller or a defense of Seller to pay the Termination Payment. Seller waives all rights to set-off, counterclaim, recoupment and any other defenses that might otherwise be available to Seller with regard to Seller’s obligation to pay the Termination Payment on the Early Termination Payment Date.
(c) Exclusive Termination Rights. Neither this Agreement nor the Delivery Period may be terminated for any reason except as specified in this Article XVII and in Section

2.2. Except with respect to amounts due for periods prior to termination, the payment of the Termination Payment and, if applicable, any amounts specified in Exhibit D-3 shall be the sole and exclusive remedy for each Party upon the termination of the Delivery Period and this Agreement for any reason, including as a result of rejection of this Agreement by either Party in any bankruptcy proceedings.

Section 17.5 Replacement of Swaps.
(a) In the event that (i) any Buyer Swap or any Seller Swap terminates, (ii) any notice of termination is delivered by any party to a Buyer Swap or a Seller Swap, or (iii) any Buyer Swap or Seller Swap is otherwise reasonably anticipated to become subject to immediate termination, in each case for any reason other than a Seller Specified Termination or insolvency of either Buyer or Seller, then each Party whose swap is affected shall notify the other Party and the Parties shall cooperate in good faith for a period of 120 days (commencing no later than the date on which any notice of termination (or anticipated termination) is delivered by any party to a Buyer Swap or a Seller Swap) (such period, the “Swap Replacement Period”) to (x) cause the same Swap Counterparty whose Buyer Swap or Seller Swap has been terminated (or is anticipated to terminate) to terminate its unaffected Seller Swap or Buyer Swap, as applicable, and (y) locate replacement agreements with an alternate Swap Counterparty, to be mutually agreed upon by Buyer and Seller, to replace both the affected swap and the unaffected swap; provided, however, that neither Party shall be required to breach any obligation under the unaffected swap or to expend any amounts to cause the unaffected swap to be replaced or to cause an alternate counterparty to replace both swaps. Neither Party shall terminate this Agreement as a result of the termination of any Seller Swap or any Buyer Swap without first complying with this Section 17.5.

As used in this Section 17.5, the term “Seller Specified Termination” means a termination or potential termination of the Seller Swap due to (i) an Event of Default (as such term is defined in the Seller Swap) with respect to Seller pursuant to Section 5(a)(iii) of the Seller Swap, in either case other than where (A) any such failure to pay or transfer was caused solely by error or omission of an administrative or operational nature; (B) funds were available to enable Seller to make such payment or transfer when due; and (C) such payment or transfer is made within two (2) Business Days of Seller’s receipt of written notice of its failure to pay or transfer, or (ii) an Attachment Staff Report Item 15C
34 Event of Default (as such term is defined in the Seller Swap) with respect to Seller under [Section 5(a)(vii)] of the Seller Swap.
(b) In the event of a termination (or anticipated termination) of the Seller Swap, if Seller (i) presents to Buyer a proposed alternate Swap Counterparty, (ii) requests in writing that Buyer enter into a replacement swap with such alternate Swap Counterparty, and (iii) agrees to pay Buyer’s reasonable expenses in connection therewith, Buyer shall (y) enter into a master agreement with such alternate Swap Counterparty and (z) either (A) terminate the Buyer Swap when permitted thereby and enter into a replacement transaction under such new master agreement to the same effect as the terminated Buyer Swap or (B) cause such Buyer Swap to be novated to such replacement Swap Counterparty, provided that, in each instance, such replacement Swap Counterparty, replacement master agreement and replacement transaction meet the requirements specified for such under the Bond Indenture. Buyer shall not replace a Buyer Swap without Seller’s consent.
(c) Each of Buyer and Seller agree that it will not enter into a replacement Buyer Swap or Seller Swap, as applicable, unless the other Party is replacing its Buyer Swap or Seller Swap, as applicable, with the same replacement Swap Counterparty. (d) In the event that the Seller Swap terminates or is no longer in effect and the Prepay LLC Payments Period (as defined in the Seller Custodial Agreement) is in effect, then, during such Prepay LLC Payments Period, Seller shall comply with the terms of the Seller Custodial Agreement and make all payments as and when required under [Section 3(e)] of the Seller Custodial Agreement. In the event that the Buyer Swap terminates or is no longer in effect and the Issuer Payments Period (as defined in the Buyer Custodial Agreement) is in effect, then, during such Issuer Payments Period, Buyer shall comply with the terms of the Buyer Custodial Agreement and make all payments as and when required under [Section 3(e)] of the Buyer Custodial Agreement. The Parties agree that during any Prepay LLC Payments Period (as defined in the Seller Custodial Agreement) and during any Issuer Payments Period (as defined in the Buyer Custodial Agreement), Seller shall act as calculation agent under the Seller Custodial Agreement or the Buyer Custodial Agreement, as applicable. Seller agrees not to permit any amendment or other modification to the Seller Custodial Agreement that could adversely affect the right of Buyer to receive payments pursuant to [Section 3(e)] of the Seller Custodial Agreement. Buyer agrees not to permit any amendment or other modification to the Buyer Custodial Agreement that could adversely affect the right of Seller to receive payments pursuant to [Section 3(e)] of the Buyer Custodial Agreement.

Section 17.6 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 Attachment Staff Report Item 15C
35 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 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. THE PARTIES ACKNOWLEDGE THAT THIS IS A SALE OF GOODS SUBJECT TO ARTICLE 2 OF THE NEW YORK UNIFORM COMMERCIAL CODE, INCLUDING WITHOUT LIMITATION, §§ 2-706(6), 2-711, 2-718, AND 2-719.

Section 17.7 Option to Purchase Bonds. In connection with any new Interest Rate Period established under the Bond Indenture after the initial Interest Rate Period, Seller shall have the option to purchase Bonds to be remarketed on the relevant [Mandatory Purchase Date] by delivering notice to Buyer and the Trustee no later than the last Business Day of the Reset Period that Seller will purchase a quantity of Bonds necessary to avoid the occurrence of a Failed Remarketing. In the event that Seller exercises such option, (x) Seller will be obligated to pay the purchase price of such Bonds in immediately available funds on the [Mandatory Purchase Date], and (y) to the extent a PSC Remarketing Termination is in effect with respect to the Reset Period commencing immediately prior to such Interest Rate Period, then Seller shall be required to remarket the Contract Quantities associated with the PSC Remarketing Termination, provided that:
(a) Seller shall be entitled to purchase such Energy for its own account, (b) for all such Energy, regardless of how it is remarketed, Seller will pay Buyer the amount determined pursuant to Section 5(b)(iv) of Exhibit C, and (c) to the extent that it is determined that interest on the Bonds purchased by Seller is not excluded from gross income for federal income tax purposes, Section 7 through Section 9 of Exhibit C shall not apply to any such remarketing.

Section 17.8 Termination Payment Adjustment Schedule. Seller shall prepare revisions to the then-current Exhibit D-2 (Termination Payment Adjustment Schedule) in Attachment Staff Report Item 15C
36 connection with each successive Interest Rate Period pursuant to the terms of the Re-Pricing Agreement by delivering a revised Exhibit D-2 to Buyer no later than the last day of the applicable Reset Period, in which case such amendments will be effective as of the first day of the next Interest Rate Period.

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. No later than delivery of the Prepayment, Buyer will deliver to Seller a copy of the Bond Indenture. The following documents shall be delivered by the Parties contemporaneously with this Agreement (unless otherwise specified):
(a) by Seller no later than the date of issuance of the Bonds, an executed copy of the Funding Agreement;
(b) by Buyer, a certificate of the Secretary or Assistant Secretary of Buyer setting forth (i) the resolutions of its governing body with respect to the authorization of Buyer to execute and deliver this Agreement, the Bond Indenture and the Power Supply Contract, (ii) the appropriate individuals who are authorized to sign such agreements, (iii) specimen signatures of such authorized individuals, and (iv) the organization documents of Buyer, certified as being true and complete;
(c) by Seller, evidence reasonably satisfactory to Buyer of (i) Seller’s authority to execute and deliver this Agreement and (ii) the appropriate individuals who are authorized to sign this Agreement; and
(d) at Seller’s request at any time, Buyer shall provide Seller with a valid sales tax exemption certificate and any other required exemption or resale certificate in jurisdictions where sales of Energy occur under this Agreement to the extent such a certificate can be obtained and is necessary for exemption from any relevant state taxes that may be levied against the Parties in relation to the transactions under, or pursuant, to this Agreement.

Section 18.3 Entirety; Amendments. This Agreement and the Re-Pricing Agreement, including the exhibits and attachments hereto and thereto, constitute the entire agreement between the Parties and supersedes all prior discussions and agreements between the Attachment Staff Report Item 15C
37 Parties with respect to the subject matter hereof and thereof. There are no prior or contemporaneous agreements or representations affecting the same subject matter other than those expressed herein and in the Re-Pricing Agreement. 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 or change herein 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 NEW YORK, WITHOUT REGARD TO ANY CONFLICTS OF LAW PRINCIPLE THAT WOULD DIRECT THE APPLICATION OF ANOTHER JURISDICTION’S LAW; PROVIDED, HOWEVER, THAT THE AUTHORITY OF BUYER TO ENTER INTO

AND PERFORM ITS OBLIGATIONS UNDER THIS AGREEMENT SHALL BE DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.

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 granting such waiver. 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, except that Seller shall act on behalf of Buyer in remarketing Energy pursuant to Exhibit C. 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.

Attachment Staff Report Item 15C
38 Section 18.10 Immunity. Buyer represents and covenants to and agrees with Seller that it is not entitled to and shall not assert the defense of sovereign immunity with respect to its obligations or any Claims under this Agreement.

Section 18.11 Rates and Indices.
(a) Commodity Reference Prices.
(i) Price Replacement Process for Energy. If a Daily Commodity Reference Price for Energy is not available for any Hour but such Daily Commodity Reference Price has not permanently ceased to be published, then the Parties shall promptly endeavor to agree on an alternative source for determination of such Daily Commodity Reference Price for the applicable Hours. If such agreement is not reached by the Parties within three (3) Business Days, the Parties shall request quotations for the applicable Daily Commodity Reference Price from four (4) recognized dealers in the applicable commodity (two (2) selected by each Party) for the period that such Daily Commodity Reference Price is expected to be unavailable. If four (4) quotations are provided as requested, the applicable Daily Commodity Reference Price for the applicable Hours shall be the arithmetic mean of the quotations provided by each recognized dealer after disregarding the quotations having the highest and lowest values; provided that, if more than one (1) quotation has the same value, then one (1) of such quotations shall be disregarded. If exactly three (3) quotations are provided, the applicable Daily Commodity Reference Price for the applicable Hours shall be the quotation provided by the relevant dealer that remains after disregarding the quotations having the highest and lowest values; provided that, if more than one (1) quotation has the same value, then the value of the two (2) quotations with the same value shall control. If fewer than three (3) quotations are provided, the Parties shall seek additional quotations until at least three (3) have been received. (ii) Price Replacement Process for Non-Published Index. If a Daily Commodity Reference Price is not available because it has permanently ceased to be published, then the Parties shall promptly endeavor to agree on an alternative source for determination of such Daily Commodity Reference Price, which may include agreeing upon a published index or a basket of published indices (“Daily Replacement Index”) from which to seek quotes for basis differentials as the replacement for the applicable Daily Commodity Reference Price. If such agreement is not reached by the Parties within three (3) Business Days, then the Daily Replacement Index shall be selected by Seller, acting reasonably. The Parties shall request quotations from four (4) recognized dealers in the applicable commodity (two (2) selected by each Party) for a basis differential (“Daily Basis Differential”) between the Daily Replacement Index and physical prices at the relevant Delivery Point for the remaining term of this Agreement. If four (4) quotations are provided as requested, the Daily Basis Differential will be the arithmetic mean of the quotations provided by each recognized dealer, after disregarding the quotations having the highest and lowest values; provided that, if more than one (1) quotation has the same value, then one (1) of such quotations shall be disregarded. If exactly three (3) quotations are provided, the Daily Basis Differential shall be the quotation provided by the relevant dealer that remains after disregarding the quotations having the highest and lowest values; provided that, if more than one (1) quotation has the same value, then the value of the two Attachment Staff Report Item 15C
39 (2) quotations with the same value shall control. If fewer than three (3) quotations are provided, the Parties shall seek additional quotations until at least three (3) have been received. The applicable Daily Commodity Reference Price shall be the Daily Replacement Index plus the Daily Basis Differential calculated in accordance with the provisions of this clause (iii).
(b) Corrections. 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 thirty (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 thirty (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 (3) 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 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 18.12 Limitation of Liability. Notwithstanding anything to the contrary herein, all obligations of Buyer under this Agreement, including without limitation all obligations to make payments of any kind whatsoever, are special, limited obligations of Buyer payable solely from 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). Buyer 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 Buyer nor the taxing power of the State of California or any political subdivision thereof is pledged to payments pursuant to this Agreement. Buyer 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 18.13 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.

Section 18.14 Rights of Trustee. Pursuant to the terms of the Bond Indenture, Buyer has irrevocably appointed the Trustee as its agent to issue notices (including Remarketing Notices, Call Option Notices, Put Option Notices and Repurchase Offers) and, as directed under the Bond Indenture, to take any other actions that Buyer is required or permitted to take under this Agreement. Seller may rely on notices or other actions taken by Buyer or the Trustee and Seller has the right to exclusively rely on any notices delivered by the Trustee that the Trustee is authorized to deliver under the Bond Indenture, regardless of any conflicting notices that it may receive from Buyer.

Attachment Staff Report Item 15C
40 Section 18.15 Waiver of Defenses. Seller waives all rights to set-off, counterclaim, recoupment and any other defenses that might otherwise be available to Seller with regard to Seller’s obligations pursuant to the terms of this Agreement.

Section 18.16 U.S. Resolution Stay. The Parties agree that (i) to the extent that prior to the date hereof the Parties hereto have adhered to the 2018 ISDA U.S. Resolution Stay Protocol (the “Protocol”), the terms of the Protocol are incorporated into and form a part of this Agreement, and for such purposes this Agreement shall be deemed a Protocol Covered Agreement and each Party shall be deemed to have the same status as Regulated Entity or Adhering Party as applicable to it under the Protocol; (ii) to the extent that prior to the date hereof the Parties have executed a separate agreement the effect of which is to amend the qualified financial contracts between them to conform with the requirements of the QFC Stay Rules (the “Bilateral Agreement”), the terms of the Bilateral Agreement are incorporated into and form a part of this Agreement and for such purposes each Party shall be deemed to have the same status as “Covered Entity”, “Counterparty Entity” or “Client Entity” (or other similar term) as applicable to it under the Bilateral Agreement; or (iii) if clause (i) and clause (ii) do not apply, the terms of Section 1 and Section 2 and the related defined terms (together, the “Bilateral Terms”) of the form of bilateral template entitled “Full-Length Omnibus (for use between U.S. G-SIBs and Corporate Groups)” or the “Agency Version of Omnibus Agreement (for use with U.S. G-SIBs)”, as applicable, published by ISDA on November 2, 2018 (currently available on the 2018 ISDA U.S. Resolution Stay Protocol page at www.isda.org), the effect of which is to amend the qualified financial contracts between the Parties thereto to conform with the requirements of the QFC Stay Rules, are hereby incorporated into and form a part of this Agreement, and for such purposes this Agreement shall be deemed a “Covered Agreement,” Seller shall be deemed a “Covered Entity” and Buyer shall be deemed a “Counterparty Entity” (or “Client Entity” for the Agency version, as applicable). In the event that, after the date of this Agreement, the Parties hereto become adhering Parties to the Protocol, the terms of the Protocol will replace the terms of this section. In the event of any inconsistencies between this Agreement and the terms of the Protocol, the Bilateral Agreement or the Bilateral Terms (each, the “QFC Stay Terms”), as applicable, the QFC Stay Terms will govern.

Terms used in this paragraph without definition shall have the meanings assigned to them under the QFC Stay Rules. For purposes of this paragraph, references to “this Agreement” include any related credit enhancements entered into between the Parties, directly or indirectly through an agent, or provided by one to the other. In addition, the Parties agree that the terms of this paragraph shall be incorporated into any related covered affiliate credit enhancements, as applicable, with all references to Seller replaced by references to the covered affiliate support provider. “QFC Stay Rules” means the regulations codified at 12 C.F.R. 252.2, 252.81–8, 12 C.F.R. 382.1- 7 and 12 C.F.R. 47.1-8, which, subject to limited exceptions, require an express recognition of the stay-and-transfer powers of the FDIC under the Federal Deposit Insurance Act and the Orderly Liquidation Authority under Title II of the Dodd Frank Wall Street Reform and Consumer Protection Act and the override of default rights related directly or indirectly to the entry of an affiliate into certain insolvency proceedings and any restrictions on the transfer of any covered affiliate credit enhancements.

Section 18.17 Rate Changes.

Attachment Staff Report Item 15C
41 (a) Absent the agreement of the Parties to the proposed change, the standard of review for changes to any rate, charge, classification, term or condition of this Agreement, whether proposed by a Party (to the extent that any waiver in Section 18.17(b) below is unenforceable or ineffective as to such Party), a non-party or FERC acting sua sponte, shall solely be the “public interest” application of the “just and reasonable” standard of review set forth in United Gas Pipe Line Co. v. Mobile Gas Service Corp., 350 U.S. 332 (1956) and Federal Power Commission v.

Sierra Pacific Power Co., 350 U.S. 348 (1956) and clarified by Morgan Stanley Capital Group Inc. v. Public Util. Dist. No. 1 of Snohomish, 554 U.S. 527 (2008) and further refined in NRG Power Marketing v. Maine Public utilities Commission, 558 U.S. 165 (2010). (b) In addition, and notwithstanding Section 18.17(a), to the fullest extent permitted by applicable Law, each Party, for itself and its successors and assigns, hereby expressly and irrevocably waives any rights it can or may have, now or in the future, whether under Section 205 and/or 206 of the Federal Power Act or otherwise, to seek to obtain from FERC by any means, directly or indirectly (through complaint, investigation or otherwise), and each hereby covenants and agrees not at any time to seek to so obtain, an order from FERC changing any section of this Agreement specifying the rate, charge, classification, or other term or condition agreed to by the Parties, it being the express intent of the Parties that, to the fullest extent permitted by applicable Law, neither Party shall unilaterally seek to obtain from FERC any relief changing the rate, charge, classification, or other term or condition of this Agreement, notwithstanding any subsequent changes in applicable Law or market conditions that may occur. In the event it were to be determined that applicable Law precludes the Parties from waiving their rights to seek changes from FERC to their market-based power sales contracts (including entering into covenants not to do so) then this Section 18.17(b) shall not apply, provided that, consistent with Section 18.17(a), neither Party shall seek any such changes except solely under the “public interest” application of the “just and reasonable” standard of review and otherwise as set forth in Section 18.17(a).

Section 18.18 No Recourse. Buyer shall have no claims against MSCG or any of its Affiliates (other than Seller), any present or future holder (whether direct or indirect) of any Equity Interests in Seller, or, in the case of any of their respective Affiliates (other than Seller), shareholders, officers, directors, employees, representatives, controlling persons, executives or agents (collectively, the “Non-Recourse Persons”) with respect to the transactions contemplated under this Agreement or under any other document, certificate or instrument executed by Seller in connection herewith, such claims against such Non-Recourse Persons (including as may arise by operation of law) being expressly waived hereby. The limitations on recourse set forth in this Section 18.18 shall survive any Early Termination Payment Date, Energy Delivery Termination Date, or other termination or expiration of this Agreement. As used in this Section 18.18, “Equity Interests” means, with respect to any Person, any and all shares, interests, participations or other equivalents (however designated) of capital stock in such Person, or any and all equivalent ownership interests in such Person, including partnership interests, limited liability company interests and membership interests, and any and all warrants, rights or options to purchase any of the foregoing.

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.

Attachment Staff Report Item 15C
42 [Separate Signature Page(s) Attached]
Attachment Staff Report Item 15C
[Signature Page to Prepaid Agreement]
ENERGY PREPAY [__], LLC
By: Morgan Stanley Capital Group Inc., its Manager
By: _____________________________
Name: _____________________________
Title: _____________________________
Attachment Staff Report Item 15C
[Signature Page to Prepaid Agreement]

CALIFORNIA COMMUNITY CHOICE FINANCING AUTHORITY
By: _____________________________
Name: Garth Salisbury
Title: Treasurer/Controller ______________________________________________ Attachment Staff Report Item 15C
A-1
EXHIBIT A-1

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

EPS ENERGY PERIOD MONTHLY PROJECTED QUANTITIES
[To be attached.]
Attachment Staff Report Item 15C
A-3
EXHIBIT A-3

ANNUAL QUANTITY
[To be attached.]
Attachment Staff Report Item 15C
B

EXHIBIT B

NOTICES
IF TO SELLER: Energy Prepay [__], LLC
c/o Morgan Stanley & Co. LLC
[1585 Broadway
New York, NY 10036-8293]
Email: CCCFA_2026[X][email protected]
With a mandatory copy to:

Email: [email protected]
General Notices: Attn: Miscellaneous Notices
Phone 24/7: 914-225-1500
Email: [email protected]
Power Scheduling: Attn: Power Scheduling
Phone 24/7: 914-225-1500
Email: [email protected]
Payments/Invoicing/
Statements:

Attn: Ops Manager, Power and Natural Gas Attn: Man
Phone: 212-762-3723 or 212-762-1049 Phone: 44
Email: [email protected] Email: phy
IF TO BUYER:

General Notices: California Community Choice Financing Authority 1125 Tamalpais Avenue
San Rafael, CA 94901
Email: [email protected]
Invoicing/Payments: Email: [email protected]
Attachment Staff Report Item 15C
C-1

EXHIBIT C

ENERGY REMARKETING
Section 1. Defined Terms. Capitalized terms used but not otherwise defined in this Exhibit shall have the meanings given to such terms in this Agreement, unless otherwise indicated.

The following terms, when used in this Exhibit C and identified by the capitalization of the first letter thereof, have the respective meanings set forth below, unless the context otherwise requires.

In the event that any of the provisions of the Code or the Treasury Regulations referenced in this Section 1 (the “Original Code Provisions”) (x) cease to be effective or no longer apply to remarketing and remediation under this Agreement and (y) upon or following such change to the Original Code Provisions, other Code provisions, Treasury Regulations or Laws apply to remarketing and remediation under this Agreement (the “New Code Provisions”), then the references herein to any such Original Code Provisions shall be deemed to refer to the applicable New Code Provisions.
“Code” means the Internal Revenue Code of 1986, as amended. “Energy Remarketing Reserve Fund” means an account established under the Bond Indenture into which Buyer shall deposit the amounts specified in Section 5(b) of this Exhibit C. “Expired Non-Private Business Sales Ledger” has the meaning specified in Section 9(a) of this Exhibit C.
“Expired Private Business Sales Ledger” has the meaning specified in Section 9(a) of this Exhibit C.
“Ledger Entry” has the meaning specified in Section 7(d) of this Exhibit C. “Ledger Event” has the meaning specified in Section 9(c) of this Exhibit C. “Minimum Remarketing Sales Price” is an amount determined for Energy by the following formula:

MRSP = RRPP - (RRPP x (RRF/CLB))
Where:

MRSP = The Minimum Remarketing Sales Price for one MWh
RRPP = The Remediation Remarketing Purchase Price for one MWh RRF = The balance of the Energy Remarketing Reserve Fund CLB = The combined cash balance of the Non-Private Business Sales Ledger and the Private Business Sales Ledger
“Monthly Discount” has the meaning specified in the Power Supply Contract.

Attachment Staff Report Item 15C
C-2
“Monthly Remarketing Notice” has the meaning specified in Section 3(b) of this Exhibit C. “Municipal Utility” means any Person that (a)(i) is a “governmental person” as defined in Treasury Regulation Section 1.141-1(b) and (ii) owns an electric distribution utility (or provides Energy at wholesale to entities described in clause (i) that own such utilities), or (b) is a community choice aggregator organized under the Laws of the State of California. Buyer shall from time to time to the extent necessary revise the definition of “Municipal Utility” to conform to the applicable provisions of the Code or Treasury Regulations by delivery of written notice to Seller setting forth the revised definition together with a Tax Opinion. “Net Participant Price” means, with respect to the Project Participant, the Contract Index Price less the Monthly Discount.
“Non-Private Business Remarketing Proceeds” means all proceeds received by Buyer under Section 5 of this Exhibit C from Seller’s remarketing of Energy in any Non-Private Business Sale.
“Non-Private Business Sale” means a sale (other than a Qualified Sale) of Energy to a “governmental person” as defined in Treasury Regulation Section 1.141-1(b) that in each case agrees in writing to not use any part of such Energy for a Private Business Use. “Non-Private Business Sales Ledger” has the meaning specified in Section 7(a) of this Exhibit C.
“Non-Qualifying Remarketing Limit” means a quantity of Energy, in MWhs, equal to 10% of the total quantity of Energy, in MWhs, to be delivered hereunder, as such Non-Qualifying Remarketing Limit may be increased from time to time upon receipt by Buyer and Seller of a Tax Opinion setting forth a higher Non-Qualifying Remarketing Limit. “Private Business Remarketing Limit” means a quantity of Energy in MWhs equal to (a) $15,000,000, divided by (b) the Specified Fixed Price, as such Private Business Remarketing Limit may be increased from time to time upon receipt by Buyer and Seller of a Tax Opinion setting forth a higher Private Business Remarketing Limit.
“Private Business Remarketing Proceeds” means all proceeds received by Buyer under Section 5 of this Exhibit C from Seller’s remarketing of Energy in any Private Business Sale (including the purchase of such Energy by Seller for its own account). “Private Business Sale” means any sale of Energy other than in a Non-Private Business Sale or a Qualified Sale.
“Private Business Sales Ledger” has the meaning specified in Section 7(b) of this Exhibit C.
“Private Business Use” has the meaning ascribed to such term in Section 141 of the Code. “Provisional Payment” has the meaning specified in Section 5(a) of this Exhibit C.

Attachment Staff Report Item 15C
C-3
“Qualified Sale” means any sale of Energy or natural gas (x) to a Municipal Utility that agrees in writing (i) to use all of such Energy or natural gas for a Qualifying Use that is not a Private Business Use and (ii) not to count any purchase of such Energy or natural gas towards any remediation obligations such Municipal Utility may have with respect to proceeds received from the sale of property purchased with tax-exempt financing proceeds; or (y) that would not (i) cause interest on the Bonds to be included, or increase the risk of interest on the Bonds of being included, in gross income for purposes of federal income taxation under applicable Law at the time of such sale, or (ii) count towards any limit under applicable Law at the time of such sale, beyond which limit interest on the Bonds would become included in gross income for purposes of federal income taxation after the passage of time and lack of any remediation. Buyer shall from time to time to the extent necessary revise the definition of “Municipal Utility” to conform to the applicable provisions of the Code or Treasury Regulations by delivery of written notice to Seller setting forth the revised definition together with a Tax Opinion.
“Qualifying Use” with respect to Energy has the meaning ascribed to such term in Treasury Regulations Section 1.148-1(e)(2)(iii)(A)(2) or (B)(2), as applicable. “Remarketing Fee” means the amount specified in Exhibit F of this Agreement. “Remarketing Notice” means a Monthly Remarketing Notice. “Remediation Remarketing” means the remarketing of Energy in Qualified Sales by Seller pursuant to Section 8 of this Exhibit C in an effort to reduce to zero (0) any Ledger Entry balances in either the Non-Private Business Sales Ledger or the Private Business Sales Ledger. “Remediation Remarketing Purchase Price” has the meaning specified in Section 8(b)(ii) of this Exhibit C.
“Tax Opinion” means an [Opinion of Bond Counsel] or [Special Tax Counsel] (as defined in the Bond Indenture) to the effect that an action proposed to be taken or an event will not, in and of itself, cause interest on the applicable Bonds to be included in gross income for purposes of federal income taxation.
“Treasury Regulations” means the U.S. Treasury Regulations under the Code.

Section 2. Buyer’s Right and Obligation to Request Remarketing. Buyer may, and, if required to do so under the Bond Indenture or the terms of this Agreement shall, request Seller to remarket, pursuant to this Exhibit C, all or a specified part of the Contract Quantities for any Delivery Point.

Section 3. Remarketing Notice.
(a) Generally. To request remarketing under this Exhibit C, Buyer must issue a Remarketing Notice, which Remarketing Notice must state as applicable (i) the portion of the Contract Quantity to be remarketed from each relevant Delivery Point, and (ii) the Delivery Hours in which such portion of the Contract Quantity is to be remarketed.

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(b) Monthly Remarketing Notice. Buyer may designate a Remarketing Notice as a “Monthly Remarketing Notice” if the Remarketing Notice is delivered to Seller not later than three (3) Business Days prior to the start of the first Month in which it applies and applies to a period of one (1) Month or more; provided furthermore that, in the event Seller is obligated to remarket Base Energy under Section 3.4 of the Agreement, Buyer shall be deemed to have delivered a Monthly Remarketing Notice with respect thereto.

Section 4. Seller’s Remarketing Obligations Generally.
(a) All Energy remarketed by Seller pursuant to this Exhibit C shall be for the benefit of Buyer, meaning all remarketed Energy shall first be sold by Seller to Buyer and then resold by or for the account of Buyer pursuant to the terms and provisions of this Exhibit C. (b) Seller may act directly as principal to the remarketing buyer or may cause a supplier to Seller to act directly as principal to the remarketing buyer. Neither Seller nor any Person acting on Seller’s behalf shall owe any fiduciary duties to Buyer with respect to the remarketing of any Energy. Buyer acknowledges and agrees that Seller or a Person acting on Seller’s behalf in remarketing Energy may have other supplies of Energy available to sell to potential remarketing buyers, and Energy designated for remarketing shall not be entitled to any preference over any such other supplies of Energy.
(c) Seller shall prepare, maintain and provide Monthly to Buyer accurate and complete records showing (i) the identity of each purchaser in a Qualified Sale, a Non-Private Business Sale, or a Private Business Sale undertaken by Seller on Buyer’s behalf, (ii) the aggregate amount of Energy remarketed under this Agreement in Qualified Sales, (iii) the aggregate amount of Energy remarketed under this Agreement in Non-Private Business Sales, and (iv) the aggregate amount of Energy remarketed under this Agreement in Private Business Sales. Notwithstanding the foregoing or anything to the contrary herein, in the event that either Party (x) reasonably determines that interest on the Bonds is not excluded from gross income for federal income tax purposes due to a change in Law, (y) receives an opinion of counsel to such effect (provided that such opinion of counsel shall be rendered by counsel of nationally recognized standing in matters pertaining to the tax exempt status of interest on obligations issued by states and their political subdivisions, duly admitted to the practice of law before the highest court of any state of the United States) and (z) notifies the other Party of such determination (which notice shall include a copy of the opinion of counsel referenced in clause (y)), then (I) the terms of this Exhibit C regarding the remediation obligations of the Parties shall cease to apply and shall be of no further force and effect, and (II) Seller shall no longer maintain the records described in the immediately preceding sentence and shall not record Ledger Entries or otherwise maintain the ledgers described in Exhibit CSection 7 and Error! Reference source not found. of this Exhibit C. (d) Any amounts due to Buyer for Energy remarketed by Seller or purchased by Seller under this Exhibit C shall be remitted to Buyer pursuant to Section 14.2 of this Agreement in the Month following the Month in which such Energy is remarketed or purchased, as applicable.

Additionally, the Parties acknowledge and agree that Seller’s payment obligations under this Exhibit C shall be reduced to the extent that any Energy remarketed hereunder is negatively priced.

Section 5. Remarketing.

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(a) Provisional Payments for and Remarketing of Assigned Product.

Notwithstanding anything to the contrary herein, the following terms shall apply to under-deliveries of Assigned Product. (i) To the extent that (A) the Annual Quantity has not been delivered for the then-current Contract Year as of the end of a Month and (B) the quantity of Assigned Product delivered under an Assigned PPA in any such Month is less than the Monthly Projected Quantity, then Seller shall pay Buyer for any such Month the product of (I) the Monthly Projected Quantity for the relevant Assigned PPA(s), minus the quantity of Assigned Product actually delivered under such Assigned PPA(s), multiplied by (II) the result of the Day-Ahead Average Price minus any applicable Provisional Payment Fee (any such payment, a “Provisional Payment”). Any Provisional Payments due from Seller to Buyer under this Section 5(a)(i) shall be paid to the Provisional Payments Account established under and defined in the Participant Custodial Agreement, and Seller shall have fully satisfied any Provisional Payment obligation upon payment of such amount in accordance with the Participant Custodial Agreement, regardless of whether the Participant Custodian complies with its obligations thereunder. In any Billing Statement that Seller delivers under Section 14.2(b) that reflects a Provisional Payment due, Seller shall indicate (x) the total amount of any Provisional Payment due for such Month and (y) the portion of such Provisional Payment that reflects the Net Participant Price that would otherwise be payable with respect thereto.
(ii) To the extent that a quantity of Assigned Products equal to or greater than the Annual Quantity are delivered for any Contract Year, any Provisional Payments made during such Contract Year shall not result in Ledger Entries under this Exhibit C. (iii) To the extent that less than the Annual Quantity of Assigned Product is delivered for any Contract Year, then (A) Buyer shall be deemed to have requested for Seller to remarket a quantity of Assigned Product equal to the Annual Quantity minus the quantity of Assigned Products actually delivered during such Contract Year (such quantities, the “Remarketed Quantities”), provided that (x) the Remarketed Quantities shall be reduced by any Assigned Products not delivered due to Force Majeure and (y) any Provisional Payment attributable to Assigned Products not delivered due to Force Majeure shall be excluded from the calculations described below, and (B) Seller shall be deemed to have purchased such Remarketed Quantities for its own account at a price equal to the Average Provisional Price (as defined in Section 5(a)(iv) below). Any purchase by Seller of the Remarketed Quantities for its own account pursuant to this Section 5(a) shall constitute a Private Business Sale and shall be reflected on the Private Business Sales Ledger effective as of the first day of the Ledger Month (as defined below). Buyer shall notify Seller if and to the extent the proceeds from any such Private Business Sales are applied to amounts owed by the Project Participant pursuant to [Section 7.5] of the Power Supply Contract, and, to the extent so applied, such proceeds shall remediate such Private Business Sales and be entered as debits on the Private Business Sales Ledger. (iv) The following terms have the meaning specified below for the purpose of this Section 5(a).

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“Average Provisional Price” means the sum of all Provisional Payment Allocation Amounts for such Contract Year.
“Ledger Month” means, for any Contract Year, the Month
immediately following the last Month for which the Pro-Rated Monthly Quantity was fully delivered for such Contract Year. For example, if (x) a Contract Year is from January 1 to December 31, (y) the Annual Quantity is 120 MWhs and (z) 110 MWhs are delivered in a given Contract Year, then the resulting Ledger Entries would be entered on December 1 for such Contract Year. For another example, if (x) a Contract Year is from January 1 to December 31, (y) the Annual Quantity is 120 MWhs and (z) 85 MWhs are delivered in a given Contract Year, then the resulting Ledger Entries would be entered on September 1 for such Contract Year. “Pro-Rated Monthly Quantity” means, for each Contract Year, the quantity attributable to each Month of such Contract Year if the Annual Quantity is divided into twelfths. For example, if the Annual Quantity is 120 MWhs, the Pro-Rated Monthly Quantity for each Month in a Contract Year is 10 MWhs – and, in such case, if (x) 110 MWhs are delivered in a given Contract Year, the Pro-Rated Monthly Quantity would be fully delivered for 11 of the 12 Months in such Contract Year; and (y) if 85 MWhs are delivered in a given Contract Year, the Pro-Rated Monthly Quantity would be fully delivered for 8 of the 12 Months in such Contract Year.
“Provisional Payment Allocation Amount” means, for each Provisional Payment in a Contract Year, an amount (in $/MWh) determined by multiplying the Weight for such Provisional Payment by the price used to calculate such Provisional Payment.
“Provisional Payment Fee” means $[1.50]/MWh, which fee shall apply with respect to Provisional Payments under this Section 5(a) in the following circumstances:
(a) to the extent that both (i) less than 95% of the Monthly Projected Quantities in aggregate under an Assigned PPA are delivered in a Contract Year and (ii) less than 95% of the Monthly Projected Quantities under the same Assigned PPA are delivered in the four consecutive Months preceding the end of such Contract Year (provided that, for the purpose of clauses (i) and (ii), any Monthly Projected Quantities not delivered due to Force Majeure shall be disregarded), the Provisional Payment Fee shall be applicable to Provisional Payments for Assigned Products under such Assigned PPA commencing with Seller’s Provisional Payment for the last Month of such Contract Year and such Provisional Payment Fee shall continue to apply with respect to such Assigned PPA until such Assigned Attachment Staff Report Item 15C
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PPA has delivered 95% or more of the Monthly Projected Quantities for such Assigned PPA for three consecutive Months; or
(b) to the extent that none of the Monthly Projected Quantities are actually delivered under an Assigned PPA for six consecutive Months due to Force Majeure, then (i) an “Assigned PPA FM Provisional Payment Event” shall be in effect until such Assigned PPA has delivered 95% or more of the Monthly Projected Quantities for such Assigned PPA for three consecutive Months and (ii) the Provisional Payment Fee shall be applicable to Provisional Payments for Assigned Products under such Assigned PPA commencing with Seller’s Provisional Payment for the sixth consecutive Month of non-deliveries until such Assigned PPA FM Provisional Payment Event is no longer in effect.
“Weight” means an amount (in $/MWh) determined for each Provisional Payment in a Contract Year by dividing the amount of each such Provisional Payment by the sum of all Provisional Payments for such Contract Year.
(b) Remarketing of Base Energy. The following provisions shall apply to the remarketing of Base Energy by Seller:
(i) Seller shall use Commercially Reasonable Efforts to remarket or cause to be remarketed all Base Energy specified for remarketing. In exercising such Commercially Reasonable Efforts, Seller shall first attempt to remarket or cause to be remarketed all Energy specified in a Remarketing Notice in Qualified Sales and then, if Seller is unable to so remarket all of such Energy for such purposes, in Non-Private Business Sales. If Seller is unable to remarket all or any portion of the Energy designated in a Remarketing Notice, then Seller shall purchase such Energy for its own account at the prices set forth in Section 5(b)(v) of this Exhibit C as if such Energy had been remarketed to it.
(ii) Seller shall not be required to remarket any Base Energy at a net price to Seller (after deducting all transportation and transmission costs and all other costs) that is anticipated to be less than the Day-Ahead Market Price applicable to such Energy in the case of a Monthly Remarketing Notice.
(iii) Notwithstanding the foregoing or anything to the contrary herein, provided that (A) the Project Participant is not in default under its Power Supply Contract and (B) Seller is remarketing such Project Participant’s portion of the Contract Quantity because an EPS Energy Period is not in effect, then:

A. Seller shall purchase Energy for its own account and shall pay Buyer the product of (A) the quantity of such Energy purchased for its own account multiplied by (B) the result of (I) the applicable Day-Ahead Market Price minus (II) the Remarketing Fee;
Attachment Staff Report Item 15C
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B. Proceeds received by Buyer under this Section 5(b)(iii) that exceed the amount Buyer would have received for the same quantity of Energy at the Net Participant Price shall be deposited in the [Participant Rebate Account] (as defined in the Bond Indenture) of the Energy Remarketing Reserve Fund; C. the Project Participant shall be required under [Section 7.5] of the Power Supply Contract to exercise Commercially Reasonable Efforts to purchase Energy for a Qualifying Use to remediate any Ledger Entry resulting from Seller’s purchase of Energy; and
D. if any Ledger Entry has not been reversed within twelve Months of the date of any such Ledger Entry, Seller thereafter shall exercise Commercially Reasonable Efforts to remediate any such Ledger Entry by making a Qualified Sale to the Project Participant or any other Municipal Utility. (iv) Proceeds from Qualified Sales and Non-Private Business Sales.

A. For any Energy specified in a Monthly Remarketing Notice that Seller remarkets in a Qualified Sale or Non-Private Business Sale, Seller shall deliver to Buyer the actual proceeds less the Remarketing Fee per MWh sold, provided that the aggregate amount delivered by Seller under this clause (A) for any Month shall not be less than the aggregate quantity so remarketed during such Month multiplied by the Net Participant Price.

B. Reserved.

C. In the event the payment due date under a Qualified Sale or Non-Private Business Sale has not yet occurred prior to the date upon which payment is due under this Agreement for the applicable Month, the Parties shall nonetheless issue statements as if the full amount from such Qualified Sale or Non-Private Business Sale had been paid and, if such full payment is not received prior to the next Monthly due date under this Agreement, the Parties shall issue the appropriate statements to reflect the actual proceeds received and true-up any difference.
(v) Proceeds from Private Business Sales.

A. For any Energy specified in a Monthly Remarketing Notice that is not remarketed in a Qualified Sale or Non-Private Business Sale, Seller shall pay to Buyer the positive result determined by the following formula with respect to each Delivery Point to which such Monthly Remarketing Notice applied, provided that the aggregate amount delivered by Seller under this clause (A) for any Month shall not be less than the aggregate quantity so remarketed during such Month multiplied by the Net Participant Price:

P = Q x (IP - RF)
Where:

Attachment Staff Report Item 15C
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P = The amount payable by Seller under this Section 5(b)(v)(A) Q = The quantity of such Energy remarketed with respect to such Delivery Point
IP = The Contract Index Price for such Delivery Point
RF = The Remarketing Fee
B. Reserved.
(vi) Energy Remarketing Reserve Fund. Any proceeds received by Buyer under this Section 5 for Energy remarketed in sales other than Qualified Sales that exceed the amount Buyer would have received for the same quantity of Energy at the Net Participant Price shall be deposited in the Energy Remarketing Reserve Fund.

Section 6. Reserved.

Section 7. Tracking Remarketing Proceeds. Seller shall maintain four (4) separate ledgers related to remarketing proceeds as described below:
(a) One (1) ledger (the “Non-Private Business Sales Ledger”) shall include, (A) as dollar credits, the Non-Private Business Remarketing Proceeds, and (B) as a MWh credit, the MWhs corresponding to such Non-Private Business Remarketing Proceeds. (b) Another ledger (the “Private Business Sales Ledger”) shall include, (A) as dollar credits, Private Business Remarketing Proceeds, and (B) as a MWh credit, the MWhs corresponding to such Private Business Remarketing Proceeds. (c) The other two (2) ledgers shall be maintained as described in Section 9(a) of this Exhibit C.
(d) The credits to be recorded in the ledgers described in Section 7(a) and (b) of this Exhibit C (collectively, the “Ledger Entries”) shall be dated as of the first day of the Month prior to the Month in which Buyer or Project Participant receives the proceeds corresponding to such Ledger Entries.
(e) The four (4) ledgers described in this Section 7 of this Exhibit C and all debits and credits to such ledgers shall be kept on an aggregate basis for purposes of this Exhibit C.

Section 8. Remediation Remarketing and Bond Redemptions. At any time that the net Ledger Entry balance of either the Non-Private Business Sales Ledger or the Private Business Sales Ledger is greater than zero (0):
(a) Buyer shall exercise Commercially Reasonable Efforts to utilize the proceeds represented by the dollar balances of such Ledger Entries to purchase Energy for resale in Qualified Sales and shall promptly notify Seller following such purchase and sale.

Attachment Staff Report Item 15C
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(b) Seller shall exercise Commercially Reasonable Efforts to locate opportunities for Buyer to purchase Energy to sell in Qualified Sales to remediate the proceeds represented by the dollar balances of the Ledger Entries. In this regard, if Seller locates a Remediation Remarketing opportunity, then:
(i) Seller shall notify Buyer of such opportunity;
(ii) Buyer shall, upon receipt of such notice, purchase Energy from Seller at a price determined by Seller in a Commercially Reasonable manner based upon applicable market prices at the location where the remarketing opportunity sale will occur (the “Remediation Remarketing Purchase Price”);
(iii) Seller shall remarket such Energy on Buyer’s behalf in a Qualified Sale;
(iv) Seller shall remit to Buyer the proceeds collected from such Qualified Sale, but in no event shall Seller remit less than the Minimum Remarketing Sales Price for the remarketing transaction; provided, however, that to the extent Seller does not receive the Remediation Remarketing Purchase Price from Buyer prior to the Remediation Remarketing described herein, Seller shall credit the proceeds collected from such remarketing sale against the Remediation Remarketing Purchase Price owed to Seller, and Seller shall be reimbursed from the Energy Remarketing Reserve Fund to the extent necessary to make Seller whole for such Qualified Sale; and (v) Seller shall issue to Buyer a confirmation notice (including the dollar price and MWhs) of each purchase of Energy by or on behalf of Buyer, and each sale of Energy on Buyer’s behalf, under this Section 8, and amounts due from or to Buyer shall be separately stated on the Billing Statement for the Month in which such remarketing transactions occur.

For the avoidance of doubt, Seller shall not sell, nor be required to sell, Energy to Buyer for a Remediation Remarketing if such Energy is to be remarketed by Seller on behalf of Buyer for less than the Minimum Remarketing Sales Price.
(c) Unless the terms of a Remediation Remarketing undertaken by Seller on Buyer’s behalf are specifically assumed by Buyer, Seller shall indemnify Buyer for any costs or liabilities associated with such Remediation Remarketing (other than costs related to the price at which such Energy is sold and the risk of collecting the sale proceeds from the remarketing buyer), including, without limitation, any cover or replacement costs; termination payments; fees, penalties, costs or charges (in cash or in kind) assessed by any Transmission Provider for failure to satisfy its balance or nomination requirements; Claims for breach of warranty; taxes, fees, levies, penalties, licenses or charges imposed by any Government Agency; and Claims from personal injury or property damages.
(d) The total purchase price of any Energy purchased by Buyer or Seller pursuant to Section 8(b) of this Exhibit C will be entered by Seller as a dollar debit on (i) first, the Private Business Sales Ledger, if and to the extent such ledger has a positive balance and such Energy is remarketed in a Qualified Sale and (ii) second, on the Non-Private Business Sales Attachment Staff Report Item 15C
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Ledger, if and to the extent such ledger has a positive balance, the Private Business Sales Ledger has a zero (0) balance, and such Energy is remarketed in a Qualified Sale, with such debit in the case of (i) or (ii) dated as of the last day of the Month in which such Energy was purchased. Each dollar debit shall offset and reverse an equal amount of the dollar credits to such ledger (that have not previously been transferred to the Expired Non-Private Business Sales Ledger or the Expired Private Business Sales Ledger) in the order in which they were made (beginning with the oldest credit not previously offset and reversed by any prior debit). Whenever a debit is made to the dollar balance of the Ledger Entries of either such ledger, Seller shall also debit the Energy balance of the Ledger Entries of such ledger based on (i) such dollar debit divided by (ii) an average Energy price calculated from the net Ledger Entry then present on the relevant ledger being debited. For the avoidance of doubt, neither the Non-Private Business Sales Ledger nor the Private Business Sales Ledger shall ever have a negative balance, and the same purchase transaction shall not result in a debit to more than one ledger except to the extent that a debit for the transaction causes one (1) ledger to have a zero (0) balance and the remaining portion of the permitted debit is made to the other ledger.
(e) In addition to the ability of Seller or Buyer to engage in Remediation Remarketing to reduce the balances of any Ledger Entries through Qualified Sales of Energy, the proceeds represented by the dollar balances of such Ledger Entries may also be remediated through the purchase of natural gas that will be remarketed in Qualified Sales. For the purposes of entering MMBtu debits for natural gas to the Ledger Entries in accordance with Section 8(d) of this Exhibit C for any Remediation Remarketing of natural gas, a quantity of MWhs will be debited based on (i) the total proceeds paid for such natural gas divided by (ii) an average Energy price calculated from the net Ledger Entry then present on the relevant ledger being debited.

Section 9. Ledger Event.
(a) In addition to the Non-Private Business Sales Ledger and the Private Business Sales Ledger described in Section 7(a) and (b) of this Exhibit C, above, Seller shall also maintain an “Expired Non-Private Business Sales Ledger” and an “Expired Private Business Sales Ledger.” Whenever a credit to the dollar balance of the Ledger Entries of the Non-Private Business Sales Ledger has not been reversed in full within two (2) years of such credit by an offsetting dollar debit in accordance with Section 8(d) or (e) of this Exhibit C, then Seller shall (i) debit the remaining portion of such dollar credit and the MWh balance of the Ledger Entries in the manner described in the penultimate sentence of Section 8(d) and (ii) record such debits as credits to the Expired Non-Private Business Sales Ledger. Similarly, whenever a credit to the dollar balance of the Ledger Entries of the Private Business Sales Ledger has not been reversed in full within two (2) years of such credit by an offsetting dollar debit in accordance with Section 8(d) or (e) of this Exhibit C, then Seller shall (i) debit the remaining portion of such dollar credit and the MWh balance of the Ledger Entries in the manner described in the penultimate sentence of Section 8(d) and (ii) record such debits as credits to the Expired Private Business Sales Ledger. (b) No later than the tenth (10th) day of each Month, Seller shall provide to Buyer copies of the Non-Private Business Sales Ledger, the Private Business Sales Ledger, the Expired Non-Private Business Sales Ledger and the Expired Private Business Sales Ledger showing all credits and debits to each such ledger since the Execution Date.

Attachment Staff Report Item 15C
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(c) A “Ledger Event” shall occur if, upon delivery of a ledger statement under Section 9(b) above, either (i) (A) the sum of all MWh credits on the Expired Non-Private Business Sales Ledger and the Expired Private Business Sales Ledger exceeds (B) the Non-Qualifying Remarketing Limit, or (ii) (A) the sum of all MWh credits on the Expired Private Business Sales Ledger exceeds (B) the Private Business Remarketing Limit, unless Buyer has obtained a Tax Opinion with respect to such event or any remedial action that may have been taken with respect to the Bonds.
(d) The occurrence of a Ledger Event and any remedies associated therewith in Article XVII of this Agreement shall be Buyer’s sole and exclusive remedies with respect to any inability by Seller to purchase and remarket Energy for Buyer pursuant to, or any breach by Seller of its obligations under, this Exhibit C.

Section 10. Buyer Right to Request to Purchase Remarketed Energy. Notwithstanding any other provision of this Exhibit C, Buyer may request in a Remarketing Notice delivered to Seller that Buyer be the remarketing buyer of the quantities of Energy described in such Remarketing Notice, in which case Seller will sell such remarketed Energy to Buyer at a price, at Delivery Point(s) and on date(s) to be mutually agreed (but the price, with respect to Energy remarketed pursuant to a Monthly Remarketing Notice, shall in no event be less than the Net Participant Price) by the Parties, provided that Seller shall be obligated to remarket such Energy to Buyer only if all of the following conditions are satisfied:
(a) Buyer is not in default under any Transaction Document; (b) Buyer has certified to Seller in the Remarketing Notice that the condition in (a) above is true;
(c) Buyer has provided such adequate assurances of Buyer’s performance, if any, as may have been reasonably requested by Seller;
(d) there is a master agreement in effect between Buyer and Seller that will govern the remarketing transaction between Buyer and Seller; and (e) Buyer covenants to resell the Energy only in Qualified Sales.

Attachment Staff Report Item 15C
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EXHIBIT D-1

TERMINATION PAYMENT SCHEDULE
The Termination Payment for any Early Termination Payment Date will be the amount set forth on the attached table in the column corresponding to the month in which the Early Termination Date occurs, plus the product of (a) the Monthly Projected Quantity for such Month and the Hourly Quantities for such Month, as applicable, minus the quantity of Energy delivered in such Month prior to the effectiveness of such Early Termination Date, multiplied by (b) the result of (i) the applicable Fixed Price for Energy (as defined in the Buyer Swap), minus (ii) the Specified Discount then in effect.
[To be attached.]
Attachment Staff Report Item 15C
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EXHIBIT D-2

TERMINATION PAYMENT ADJUSTMENT SCHEDULE
(To be attached pursuant to Section 17.8 as required.)
Attachment Staff Report Item 15C
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EXHIBIT D-3

POST TERMINATION PAYMENT SCHEDULE
[To be attached.]
Attachment Staff Report Item 15C
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EXHIBIT E

RESERVED
Attachment Staff Report Item 15C
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EXHIBIT F

PRICING AND OTHER TERMS
Delivery Period: The period beginning on [_______] 1, 2026 and ending on [_____], 20[__] or earlier upon the Early Termination Date Minimum Discount: $[___]/MWh for each Reset Period after the Initial Reset Period (as defined in the Re-Pricing Agreement)
Monthly Discount: $[___]/MWh from [_______] 1, 2026 through and including [_____], 20[__] and for each Month of a Reset Period
thereafter, the Monthly Discount portion of the Available Discount for such Reset Period determined by the [Calculation Agent] (as defined in the Bond Indenture) pursuant to the Re-Pricing Agreement.

Prepayment: $[______]
Prepayment Outside Date: [_____], 2026
Remarketing Fee: $[0.50]/MWh, provided that:
(i) the Remarketing Fee shall be $[1.50] for
any remarketing pursuant to Section 5(b)(iii) of Exhibit C; and (ii) the Remarketing Fee shall be zero with
respect to any Product remarketed to Buyer in accordance with Section 10 of Exhibit C.

Specified Fixed Price: $[___]/MWh
Specified Discount: $[___]/MWh from [_____] 1, 2026 through and including [_____], 20[__], and for each Reset Period thereafter, the Available Discount (as defined in the Re-Pricing Agreement) determined by the [Calculation Agent] (as defined in the Bond Indenture) pursuant to the Re-Pricing Agreement.

ESR Fee: $[1.10]/MWh
Swap Fee: $[___]/MWh
Attachment Staff Report Item 15C
Exhibit G

EXHIBIT G

RECEIVABLES PURCHASES
[To be attached.]
Attachment Staff Report Item 15C
Sheppard Draft 11 May 2026
Relates to Clean Energy Purchase Contract with Ava Community Energy Authority

MASTER POWER SUPPLY AGREEMENT
between
ARON ENERGY PREPAY [__] LLC
and

CALIFORNIA COMMUNITY CHOICE FINANCING AUTHORITY
Dated as of [___], 202[_]
Attachment Staff Report Item 15D
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TABLE OF CONTENTS
Page
ARTICLE I. DEFINITIONS ....................................................................................................... 1 Section 1.1 Defined Terms................................................................................................... 1 Section 1.2 Definitions; Interpretation ............................................................................... 12 ARTICLE II. EXECUTION DATE; DELIVERY PERIOD; J. ARON AS AGENT .......... 13 Section 2.1 Execution Date; Delivery Period..................................................................... 13 Section 2.2 Termination by Seller Prior to Prepayment..................................................... 13 ARTICLE III. SALE AND PURCHASE ................................................................................. 14 Section 3.1 Sale and Purchase of Product .......................................................................... 14 Section 3.2 Limited Obligation to Take Base Quantities................................................... 15 Section 3.3 Prepayment ...................................................................................................... 15 Section 3.4 Other Amounts Payable with Respect to Assigned Product............................ 15 ARTICLE IV. FAILURE TO SCHEDULE PRODUCT ........................................................ 15 Section 4.1 Assigned Product............................................................................................. 15 Section 4.2 Failure to Deliver or Take Due to Force Majeure ........................................... 16 Section 4.3 Sole Remedies ................................................................................................. 16 ARTICLE V. DELIVERY POINTS; SCHEDULING ............................................................ 16 Section 5.1 Delivery Points................................................................................................ 16 Section 5.2 Transmission and Scheduling.......................................................................... 17 Section 5.3 Title and Risk of Loss...................................................................................... 17 Section 5.4 PCC1 Product, Long-Term PCC1 Product and PCC2 Product....................... 18 Section 5.5 Communications Protocol ............................................................................... 21 Section 5.6 Deliveries Within CAISO or Another Balancing Authority ........................... 21 Section 5.7 Assigned Product............................................................................................. 21 ARTICLE VI. ASSIGNMENT OF POWER PURCHASE AGREEMENTS....................... 22 Section 6.1 Assignments Generally.................................................................................... 22 Section 6.2 Failure to Obtain EPS Compliant Energy........................................................ 22 Section 6.3 Adjustments to Swaps ..................................................................................... 22 Section 6.4 Adjustments to Base Quantities....................................................................... 22 Section 6.5 APC Party Make-Whole.................................................................................. 23 ARTICLE VII. PRODUCT REMARKETING ....................................................................... 23 Attachment Staff Report Item 15D
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Section 7.1 Product Remarketing ....................................................................................... 23 ARTICLE VIII. REPRESENTATIONS AND WARRANTIES ............................................ 23 Section 8.1 Representations and Warranties ...................................................................... 23 Section 8.2 Additional Representations and Warranties of Buyer..................................... 25 Section 8.3 Funding Agreement ......................................................................................... 25 Section 8.4 Warranty of Title ............................................................................................. 25 Section 8.5 Disclaimer of Warranties................................................................................. 25 ARTICLE IX. TAXES................................................................................................................ 25 ARTICLE X. JURISDICTION; WAIVER OF JURY TRIAL .............................................. 26 Section 10.1 Consent to Jurisdiction .................................................................................... 26 Section 10.2 Waiver of Jury Trial ........................................................................................ 26 ARTICLE XI. FORCE MAJEURE.......................................................................................... 27 Section 11.1 Applicability of Force Majeure ....................................................................... 27 Section 11.2 Settlement of Labor Disputes.......................................................................... 27 ARTICLE XII. GOVERNMENTAL RULES AND REGULATIONS.................................. 27 Section 12.1 Compliance with Laws.................................................................................... 27 Section 12.2 Contests ........................................................................................................... 27 Section 12.3 Defense of Agreement..................................................................................... 27 ARTICLE XIII. ASSIGNMENT............................................................................................... 28 ARTICLE XIV. PAYMENTS.................................................................................................... 29 Section 14.1 Monthly Statements......................................................................................... 29 Section 14.2 Payment ........................................................................................................... 30 Section 14.3 Payment of Disputed Amounts........................................................................ 30 Section 14.4 Late Payment ................................................................................................... 31 Section 14.5 Audit; Adjustments.......................................................................................... 31 Section 14.6 Netting ............................................................................................................. 31 ARTICLE XV. RECEIVABLES PURCHASES...................................................................... 32 ARTICLE XVI. NOTICES........................................................................................................ 32 ARTICLE XVII. DEFAULT; REMEDIES; TERMINATION.............................................. 32 Section 17.1 Product Delivery Termination Events and Termination Payment Events....... 32 Section 17.2 Payments Following a Ledger Event............................................................... 38 Section 17.3 Reserved .......................................................................................................... 38 Section 17.4 Remedies and Termination.............................................................................. 38 Section 17.5 Replacement of Swaps..................................................................................... 39 Attachment Staff Report Item 15D
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Section 17.6 Present Assignment and Waiver of Right to Swap Termination Payments.... 42 Section 17.7 Limitation on Damages ................................................................................... 42 Section 17.8 Termination Payment Adjustment Schedule ................................................... 43 ARTICLE XVIII. MISCELLANEOUS.................................................................................... 43 Section 18.1 Indemnification Procedure .............................................................................. 43 Section 18.2 Deliveries......................................................................................................... 43 Section 18.3 Entirety; Amendments..................................................................................... 44 Section 18.4 Governing Law................................................................................................ 44 Section 18.5 Non-Waiver ..................................................................................................... 44 Section 18.6 Severability...................................................................................................... 44 Section 18.7 Exhibits............................................................................................................ 45 Section 18.8 Winding Up Arrangements.............................................................................. 45 Section 18.9 Relationships of Parties; Beneficiaries............................................................ 45 Section 18.10 Immunity ......................................................................................................... 45 Section 18.11 Rates and Indices............................................................................................. 45 Section 18.12 Limitation of Liability ..................................................................................... 46 Section 18.13 Counterparts..................................................................................................... 46 Section 18.14 Rights of Trustee ............................................................................................. 46 Section 18.15 Operational Services Agreement..................................................................... 47 Section 18.16 Waiver of Defenses ......................................................................................... 47 Section 18.17 U.S. Resolution Stay Provisions...................................................................... 47 Section 18.18 Seller Tariff...................................................................................................... 47 Section 18.19 No Recourse .................................................................................................... 47 Section 18.20 Rate Changes................................................................................................... 47 Section 18.21 Delivering Entity Tariff................................................................................... 48 Exhibit A-1 — Base Quantities; Base Delivery Point; Commodity Reference Prices Exhibit A-2 — EPS Energy Period Monthly Projected Quantity Exhibit A-3 — Annual Quantity
Exhibit B — Notices
Exhibit C — Product Remarketing
Exhibit D-1 — Termination Payment Schedule
Attachment Staff Report Item 15D
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Exhibit D-2 — Termination Payment Adjustment Schedule
Exhibit D-3 — Post-Termination Payment Schedule
Exhibit E — Receivables Purchase Exhibit
Exhibit F — Pricing and Other Terms
Exhibit G — Communications Protocol
Attachment Staff Report Item 15D
1 MASTER POWER SUPPLY AGREEMENT
This Master Power Supply Agreement (hereinafter, this “Agreement”) is made and entered into as of [____], 202[_] (the “Execution Date”), by and between Aron Energy Prepay [__] LLC, a Delaware limited liability company (“Seller”), and 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) (“Buyer”). Each of Seller and Buyer is sometimes individually referred to herein as a “Party”, and collectively as the “Parties”.

W I T N E S S E T H:

WHEREAS, Buyer desires to purchase Product from Seller or Seller’s designee, as applicable, upon the terms and conditions hereinafter set forth; WHEREAS, in connection with the execution of this Agreement, Seller shall enter into that certain Electricity Purchase, Sale and Service Agreement, dated as of the date hereof (the “Electricity Sale and Service Agreement”), with J. Aron (as defined below), pursuant to which (a) Seller shall (i) delegate its power sale and delivery obligations under this Agreement to J. Aron and (ii) acquire Product for sale under this Agreement and (b) J. Aron shall act as Seller’s agent hereunder and the other agreements entered into by Seller in connection with the Clean Energy Project (as defined below); and
WHEREAS, concurrently with Buyer’s execution of the Clean Energy Purchase Contract (as defined below), the Project Participant (as defined below) under such Clean Energy Purchase Contract shall assign to J. Aron certain Assigned Rights and Obligations, including the right to receive Assigned Product, which Assigned Product will be resold to Seller under the Electricity Sale and Service Agreement, then resold to Buyer hereunder and then resold to the Project Participant under the Clean Energy Purchase Contract.

NOW, THEREFORE, in consideration of the premises above and the mutual covenants and agreements herein set forth, the Parties agree as follows:

ARTICLE I.

DEFINITIONS
Section 1.1 Defined Terms. The following terms, when used in this Agreement (including the preamble or recitals to this Agreement) and identified by the capitalization of the first letter thereof, have the respective meanings set forth below, unless the context otherwise requires:
“Administrative Fee” means the amount per MWh specified as such in Exhibit F. “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 Attachment Staff Report Item 15D
2 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. “Alternate Delivery Point” has the meaning specified in Section 5.1(a). “Annual Quantity” means, with respect to each Contract Year of the Delivery Period, the quantity (in MWh) of Assigned Product for such Contract Year as set forth on Exhibit A-3; provided that the Annual Quantity for any Contract Year shall be reduced by the aggregate amount of any quantities of Base Product required to be remarketed under this Agreement for any given Contract Year.
“APC Party” means the seller under an [Assignable Power Contract] (as defined in the [Clean Energy Purchase Contract]).
[“Applicable Project” has the meaning specified in the Clean Energy Purchase Contract.]
“Assigned Delivery Point” means, with respect to any Assigned Energy, the Assigned Delivery Point as set forth in the applicable Assignment Schedule for such Assigned Energy.
“Assigned Energy” means any Energy, including Energy associated with PCC1 Product and Long-Term PCC1 Product, to be delivered to J. Aron pursuant to any Assigned Rights and Obligations and re-delivered by J. Aron to Seller under the Electricity Sale and Service Agreement.
[“Assigned PPA” has the meaning specified in the Clean Energy Purchase Contract.]
“Assigned Product” means, as applicable, PCC1 Product, Long-Term PCC1 Product, PCC2 Product, Assigned Energy, Assigned RECs and any other Product included on an Assignment Schedule, subject to the limitations for such other Product set forth in [Exhibit F of the Clean Energy Purchase Contract].
[“Assigned Quantity” has the meaning specified in the Clean Energy Purchase Contract.]
“Assigned RECs” means any RECs associated with PCC1 Product or Long-Term PCC1 Product to be delivered to J. Aron pursuant to any Assigned Rights and Obligations and re-delivered by J. Aron to Seller under the Electricity Sale and Service Agreement.

Attachment Staff Report Item 15D
3 “Assigned Rights and Obligations” has the meaning specified in the [Clean Energy Purchase Contract].
“Assignment Agreement” has the meaning specified in the [Clean Energy Purchase Contract].
“Assignment Period” has the meaning specified in the [Clean Energy Purchase Contract].
“Assignment Schedule” has the meaning specified in [Exhibit F of the Clean Energy Purchase Contract].
“Automatic Product Delivery Termination Event” has the meaning specified in Section 17.1.
“Balancing Authority” has the meaning specified in the [CAISO Tariff]. “Base Delivery Point” has the meaning specified in Section 5.1(a). “Base Product” means Firm (LD) Energy to be delivered to the Base Delivery Point.
“Base Quantity” means, with respect to each Delivery Hour during the Delivery Period, the Base Unadjusted Quantity for such Delivery Hour less the Base Quantity Reduction for such Delivery Hour, each as set forth on Exhibit A-1, as Exhibit A-1 may be revised pursuant to Article VI.
“Base Quantity Reduction” means, with respect to each Delivery Hour during the Delivery Period, the “Base Quantity Reduction” of Base Product (in MWh) set forth for such Delivery Hour on Exhibit A-1, as Exhibit A-1 may be revised pursuant to Article VI. “Base Unadjusted Quantity” means, with respect to each Delivery Hour during the Delivery Period, the “Base Unadjusted Quantity” of Base Product (in MWh) set forth for such Delivery Hour on Exhibit A-1.
“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 Trust Indenture.
“Bonds” means the bonds issued pursuant to the Trust 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 generally in either New York, New York or the State of California are authorized or required by Law to close, or (iv) any day excluded from a “Business Day,” as therein defined, pursuant to the Trust Indenture. “Buyer” has the meaning specified in the preamble.

Attachment Staff Report Item 15D
4 “Buyer Swap” means (i) the transaction confirmation entered into under the ISDA Master Agreement, dated as of the date hereof, between Buyer and the Swap Counterparty, and (ii) each replacement Buyer Swap entered into pursuant to Section 17.5. “Buyer Swap Custodial Agreement” means the Custodial Agreement, dated as of the Bond Closing Date, by and among Buyer, the Trustee, the Custodian, and the Swap Counterparty, and any replacement thereof entered into in connection with Buyer’s entry into a replacement Buyer Swap pursuant to Section 17.5.
“Buyer’s Statement” has the meaning specified in Section 14.1(a). “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.
“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.
“CEC” means California’s State Energy Resources Conservation and Development Commission, also known as the California Energy Commission, and any successor agency thereto. “Claiming Party” has the meaning specified in Section 11.1. “Claims” means all third party claims or actions, threatened or filed and, whether groundless, false, fraudulent, or otherwise, that directly or indirectly relate to the subject matter of 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. [“Clean Energy Project” has the meaning specified in the Clean Energy Purchase Contract.]
“Clean Energy Purchase Contract” means that certain Clean Energy Purchase Contract between Buyer and Project Participant to be entered into in connection with the Clean Energy Project.
“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.

Attachment Staff Report Item 15D
5 “Commodity Reference Price” means either (i) the Day-Ahead Market Price, or (ii) the Real-Time Market Price, as applicable.
“Contract Year” means each period of 12 Months from January 1 until December 31 during the Delivery Period; provided that (x) the initial Contract Year shall be a pro-rated [] Month period from [__], 202[_] through [_], 202[_] and (y) the Annual Quantity for 202[_] set forth in Exhibit A-3 reflects the pro-rated Annual Quantity for such [_] Month period in 202[_]. “Custodian” means initially U.S. Bank Trust Company, National Association, as custodian under each of the Swap Custodial Agreements.
“Day” means each period of 24 consecutive Hours commencing at the Hour ending at 01:00 (LPT) through the Hour ending at 24:00 (LPT).
“Day-Ahead Average Price” means, for any Monthly Projected Quantities, the result of (i) (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; plus (ii) $[_]/MWh. As used in this definition, “Pricing Interval” means the unit of time for which CAISO establishes a separate price. “Day-Ahead Market Price” has the meaning specified on Exhibit A-1 for the Primary Delivery Point.
“Deemed Remarketing Notice” has the meaning specified in Exhibit C. “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 per annum, or (b) if a lower maximum rate is imposed by applicable Law, such maximum lawful rate.
“Delivering Entity” means any Person designated from time to time by Seller in writing to effectuate the Product sale, delivery and scheduling obligations hereunder. The Delivering Entity shall initially be Seller, provided that any subsequent designation of a different Delivering Entity must be provided at least 10 days prior to the effectiveness thereof and must take effect on the first day of a Month.
“Delivering Entity Tariff” means the tariff or rate schedule that the Delivering Entity filed with FERC, and FERC has accepted for filing, as may be modified, amended or supplemented from time to time, authorizing the sale of energy, capacity, and certain ancillary services at market-based rates.
“Delivery Hour” has the meaning specified in Exhibit A-1. “Delivery Period” means the period specified in Exhibit F. “Delivery Point” means the Base Delivery Point or an Assigned Delivery Point, as applicable.

Attachment Staff Report Item 15D
6 “Discount Rate Spread” has the meaning specified in Exhibit F. “Early Termination Payment Date” means the last Business Day of the first Month that commences after a Termination Payment Event; provided that, in the case of a Termination Payment Event due to a Failed Remarketing, the Early Termination Payment Date shall be the last Business Day of the then-current Interest Rate Period.
“Electricity Sale and Service Agreement” has the meaning specified in the recitals. “Eligible Renewable Energy Resource” has the meaning set forth in California Public Utilities Code Section 399.12(e) and California Public Resources Code Section 25741(a), as either code provision is amended or supplemented from time to time. “Energy” means three-phase, 60-cycle alternating current electric energy, expressed in MWh.
“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” has the meaning specified in the Clean Energy Purchase Contract.]
[“EPS Energy Period” has the meaning specified in the Clean Energy Purchase Contract.]
“Execution Date” has the meaning specified in the preamble. “Failed Remarketing” has the meaning specified in the Trust Indenture. “FERC” means the Federal Energy Regulatory Commission or any successor thereto.
“Firm (LD)” means, with respect to a Party’s obligation (i) to cause to be sold and delivered and (ii) to purchase and receive, as applicable, that such Party’s liability for the failure to meet such obligation shall only be excused to the extent that, and for the period during which, such performance is prevented by Force Majeure, and that in the absence of Force Majeure, the Party to which performance of such obligation is owed shall be entitled to receive from the Party which failed to cause to be delivered or to receive, as applicable, an amount determined pursuant to Article IV.

Force Majeure” means an event or circumstance which prevents a Party or the Delivering Entity from performing its obligations under this Agreement, which event or circumstance was not anticipated 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; provided that, for the avoidance of doubt, to the extent that (x) an APC Party to an Assigned PPA fails to deliver any Assigned Product and claims force majeure with respect to such failure to deliver or (y) an Attachment Staff Report Item 15D
7 APC Party to an Assigned PPA otherwise is unable to deliver any portion of the Annual Quantity due to an event that would be considered Force Majeure under this Agreement if it affected Prepay LLC directly, then, in either case, such event shall be deemed to constitute Force Majeure in respect of Prepay LLC hereunder. Force Majeure shall include, provided the criteria in the first sentence are met, riot, insurrection, war, labor dispute, natural disaster, vandalism, terrorism, and sabotage. Force Majeure shall not be based on (i) the loss of Buyer’s markets; (ii) Buyer’s inability economically to use or resell the Product purchased hereunder; (iii) the delay, loss or failure of the Delivering Entity’s supply; or (iv) the Delivering Entity’s ability to sell the Product 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 (x) such Party has contracted for firm transmission with such Transmission Provider for the Product to be delivered to or received at the applicable Delivery Point and (y) 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. For the avoidance of doubt, and notwithstanding anything herein to the contrary, (I) the declaration of “Force Majeure” by the Project Participant under the Clean Energy Purchase Contract shall each constitute Force Majeure hereunder, and (II) to the extent that an Assignment Agreement is terminated early, such termination shall constitute Force Majeure with respect to the Delivering Entity hereunder until the earlier of (A) the commencement of an “Assignment Period” under a replacement Assignment Agreement, (B) the commencement of a [J. Aron EPS Energy Period] (as defined in the Electricity Sale and Service Agreement) or (C) the end of the second Month following the Month in which such early termination occurs. “Funding Agreement” means initially that certain [Deposit Note], dated as of the date hereof, by and between Seller and the Funding Recipient and any replacement funding agreement entered into for a subsequent Reset Period.
“Funding Recipient” means initially [___], or its successors to or permitted assignees under the Funding Agreement, and any other Person that becomes a counterparty to Seller under a Funding Agreement for a subsequent Reset Period. “Funding Recipient Acceleration Option” means the exercise by Funding Recipient of any right it may have to prepay the outstanding amounts on the Funding Agreement following the designation of a Product Delivery Termination Date. “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.
“Governmental Approval” means any authorization, consent, approval, license, ruling, permit, exemption, variance, order, judgment, registration, filing, giving of notice to, decree, declaration of or regulation by any Government Agency relating to the valid execution, delivery or performance of this Agreement or the consummation of any of the transactions contemplated hereby.

Attachment Staff Report Item 15D
8 “Hour” means the 60-minute period commencing at 00:00 (LPT) on the first Day of the Delivery Period and ending at 01:00 (LPT) on the first Day of the Delivery Period, and each 60-minute interval thereafter.
“Initial Assigned Rights and Obligations” means the Assigned Rights and Obligations set forth in Exhibit A-2 hereto as of the date hereof. “Initial Assignment Periods” means the Assignment Periods for the Initial Assigned Rights and Obligations specified in Exhibit A-2 hereto as of the date hereof. “Interest Rate Period” has the meaning specified in the Trust Indenture. “ISTs” has the meaning specified in Section 5.1(a).
“J. Aron” has the meaning specified in the recitals.
“J. Aron Acceleration Option” means the exercise by J. Aron of its right under the Electricity Sale and Service Agreement to pay the Termination Payment to Seller following the occurrence of a Ledger Event, which shall be subject to Seller’s prior consent thereto as provided in the Electricity Sale and Service Agreement.
[“J. Aron Fixed Payment” has the meaning specified in the PPA Custodial Agreement.]
[“J. Aron Prepay Payment” has the meaning specified in the PPA Custodial Agreement.]
“Law” means any statute, law, rule or regulation or any written judicial or administrative decision, ruling or interpretation with respect thereto or 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 during the term of this Agreement. “Ledger Event” has the meaning specified in Exhibit C.
“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 J. Aron pursuant to any Assigned Rights and Obligations. “LPT” means the local prevailing time then in effect in the State of California. “Mandatory Purchase Date” has the meaning specified in the Trust Indenture. [“Minimum Discount Percentage” has the meaning specified in the Clean Energy Purchase Contract.]
“Month” means a period beginning on the first Day of a calendar month and ending immediately prior to the commencement of the first Day of the next calendar month. The term “Monthly” shall be construed accordingly.

Attachment Staff Report Item 15D
9 “Monthly Excess Quantity” means, for any Month, the amount, if any, by which the total quantity (in MWh) of Assigned Product delivered under an Assigned PPA in such Month exceeds the Monthly Projected Quantity for such Assigned PPA in such Month. “Monthly Projected Quantity” means, with respect to each Assigned PPA and each Month of the Assignment Period for each Assigned PPA, the quantity (in MWh) of Assigned Product for such Month as set forth on [Exhibit A-2] for such Assigned PPA (as such [Exhibit A-2] may be updated from time to time pursuant to Article VI). “MWh” means megawatt-hour.
“Net Participant Price” means, for any Product and Delivery Hour, the [Contract Price] (as defined in the [Clean Energy Purchase Contract]) for such Product and Delivery Hour under the Clean Energy Purchase Contract.
“Optional Product Delivery Termination Event” has the meaning specified in Section 17.1.
“Party” has the meaning specified in the preamble.
“PCC1 Product” means bundled renewable energy and RECs meeting the requirements of Portfolio Content Category 1 to be delivered to J. Aron pursuant to any Assigned Rights and Obligations.
“PCC2 Product” means bundled renewable energy and RECs meeting the requirements of Portfolio Content Category 2 to be delivered to J. Aron, Seller 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” or “PCC1” 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. “Portfolio Content Category 2” or “PCC2” 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)(2), as may be amended from time to time or as further defined or supplemented by Law. “PPA Custodial Agreement” means that certain PPA Custodial Agreement, dated as of May 7, 2026, by and among the Project Participant, Buyer, J. Aron and the PPA Custodian. “PPA Custodian” means U.S. Bank Trust Company, National Association, and its successors as custodian under the PPA Custodial Agreement. “Prepayment” means the amount specified as such in Exhibit F.

Attachment Staff Report Item 15D
10 “Prepayment Outside Date” means the date specified as such in Exhibit F. “Primary Delivery Point” has the meaning specified in Section 5.1(a). “Product” means Energy and, to the extent included on an Assignment Schedule, associated RECs or other products related to the foregoing; provided that the inclusion of any Product on an Assignment Schedule is subject to the limitation set forth in [Exhibit F of the Clean Energy Purchase Contract].
“Product Delivery Termination Date” means a date that occurs automatically pursuant to Section 17.1 or that is designated pursuant to Section 17.4(b) upon which the Delivery Period will end and Buyer’s and Seller’s respective obligations to receive and deliver or cause the delivery of Product under this Agreement will terminate. “Product Delivery Termination Event” has the meaning specified in Section 17.1. “Project Participant” means Ava Community Energy Authority, a joint powers authority and a community choice aggregator organized under the Laws of the State of California. “Provisional Payment” has the meaning specified in Exhibit C. “Rating Confirmation” has the meaning specified in the Trust Indenture. “Re-Pricing Agreement” means the Re-Pricing Agreement, dated as of the Bond Closing Date, by and between Buyer and Seller.
“Real-Time Market Price” has the meaning specified on Exhibit A-1 for each Delivery Point.
“Remarketing Entity” has the meaning specified in Section 3.1(e). “Remarketing Fee” means the amount specified in Exhibit F. “Remarketing Notice” has the meaning specified in Section 1 of Exhibit C. “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. [“Replacement Assigned Rights and Obligations” has the meaning specified in the Clean Energy Purchase Contract.]
“Reset Period” means each “Reset Period” under the Re-Pricing Agreement. “RPS Law” means the California Renewable Energy Resources Act, including the California Renewables Portfolio Standard Program, Article 16 of Chapter 2.3, Division 1 of the California Public Utilities Code, as implemented and amended from time to time, and any successor Law.

Attachment Staff Report Item 15D
11 “Schedule”, “Scheduled” or “Scheduling” means the actions of the Delivering Entity, Buyer and/or their designated representatives, including each Party’s Transmission Providers, if applicable, of notifying, requesting and confirming to each other the quantity and type of Product to be delivered during any given portion of the Delivery Period at a specified Delivery Point.
“Seller” has the meaning specified in the preamble.
“Seller Swap” means (i) the transaction confirmation entered into under the ISDA Master Agreement, dated as of the date hereof, between Seller and the Swap Counterparty, and (ii) each replacement Seller Swap entered into pursuant to Section 17.5. “Seller Swap Custodial Agreement” means the Custodial Agreement, dated as of the Bond Closing Date, by and among Seller, the Trustee, the Custodian, and the Swap Counterparty, and any replacement thereof entered into in connection with Seller’s entry into a replacement Seller Swap pursuant to Section 17.5.
“Seller Tariff” means the tariff that Seller has received from FERC, as may be modified, amended or supplemented from time to time.
“SOFR” means the Secured Overnight Financing Rate reported by the Federal Reserve Bank of New York.
“SPE Master Custodial Agreement” means that certain SPE Master Custodial Agreement, dated as of the date hereof, by and among the Seller, J. Aron, Buyer and the SPE Master Custodian.
“SPE Master Custodian” means initially The Bank of New York Mellon, a New York banking corporation as custodian under the SPE Master Custodial Agreement. “Specified Fixed Price” means the amount specified in Exhibit F. “Specified Investment Agreement” means a guaranteed investment contract between the Trustee and a provider concerning the investment of funds in the [Commodity Reserve Account], the [Debt Service Reserve Account] and/or the [Debt Service Account] (each as defined in the [Trust Indenture]).
“Swap Counterparty” means (i)[___], and (ii) any other Person that becomes counterparty to Buyer under a Buyer Swap or to Seller under a Seller Swap, in each case pursuant to Section 17.5(d).
“Swap Custodial Agreements” means the Buyer Swap Custodial Agreement and the Seller Swap Custodial Agreement.
“Swap Replacement Period” has the meaning specified in Section 17.5(c). “Terminating Party” means any Party that has the right to terminate this Agreement pursuant to Article XVII.

Attachment Staff Report Item 15D
12 “Termination Payment” means, with respect to any Early Termination Payment Date, the amount specified on Exhibit D-1 for the Month in which such Early Termination Payment Date occurs (as increased or decreased (as applicable) by any applicable Termination Payment Adjustment Amount specified on Exhibit D-2) without any set-off or netting of amounts then due from Buyer.
“Termination Payment Adjustment Amount” means, with respect to any Early Termination Payment Date, the amount, if any, specified on Exhibit D-2 for the Month in which such Early Termination Payment Date occurs. For the avoidance of doubt, the Termination Payment Adjustment Amount is initially zero.
“Termination Payment Adjustment Schedule” means the schedule of Termination Payment Adjustment Amounts set forth in Exhibit D-2, as such exhibit may be populated and amended from time to time in accordance with Section 17.8. “Termination Payment Event” means (i) a Product Delivery Termination Event specified as a Termination Payment Event in Section 17.1, (ii) a Funding Recipient Acceleration Option, or (iii) a J. Aron Acceleration Option.
“Transaction Documents” has the meaning specified in Article XIII. “Transmission Provider” means any entity or entities transmitting or transporting the Product on behalf of the Delivering Entity or Buyer to or from the applicable Delivery Point. “Trust Indenture” means (i) the Trust Indenture to be entered into prior to the commencement of the Delivery Period between Buyer and the Trustee, and (ii) any trust indenture entered into in connection with the commencement of any Interest Rate Period after the initial Interest Rate Period between Buyer 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. “Trustee” means U.S. Bank Trust Company, National Association, and its successors as trustee under the Trust Indenture, and its successors as Trustee under the Trust Indenture.
“Western EIM” has the meaning ascribed to Energy Imbalance Market (EIM) under the CAISO Tariff.
“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 Attachment Staff Report Item 15D
13 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 broadest scope of such general statement, term or matter.

Except where expressly provided otherwise, 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 in accordance with its terms and the terms hereof, 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; DELIVERY PERIOD; J. ARON AS AGENT
Section 2.1 Execution Date; Delivery Period. This Agreement shall become effective upon the Execution Date and, unless this Agreement is terminated early pursuant to Section 2.2, all of Seller’s and Buyer’s obligations under this Agreement shall be deemed to have been incurred upon the Execution Date. Unless this Agreement is sooner terminated pursuant to Section 2.2, the delivery of Product under this Agreement shall commence at the beginning of and continue for the Delivery Period.

Section 2.2 Termination by Seller Prior to Prepayment. Seller shall have no obligation to perform under this Agreement unless and until it has received the Prepayment from Buyer pursuant to Section 3.3. In the event Seller has not received the Prepayment prior to 24:00 LPT on the Prepayment Outside Date, Seller shall have the right, until such Prepayment has been paid, to terminate this Agreement without any further obligation or liability of either Party, it being understood and agreed that in the event Seller so terminates, such termination shall be effective as of Hour ending 24:00 LPT on the Prepayment Outside Date, regardless of whether Buyer tenders the Prepayment prior to such termination. For the avoidance of doubt, no Termination Payment shall be payable under any circumstances if this Agreement terminates pursuant to this Section

2.2; provided furthermore that, to the extent J. Aron designates a termination of the Electricity Sale and Service Agreement pursuant to Section 2.2 thereof, Seller shall be deemed to have designated a termination of this Agreement pursuant to this Section 2.2.

Section 2.3 J. Aron as Agent. Pursuant to the terms of the Electricity Sale and Service Agreement, Seller has irrevocably appointed J. Aron as its agent to issue notices and, as set forth therein, to take any other actions that Seller is required or permitted to take under this Agreement and the other agreements entered into by Seller in connection with the Clean Energy Project so long as the Electricity Sale and Service Agreement remains in effect. Buyer may rely on notices or other actions taken by J. Aron on Seller’s behalf; provided that, if (a) the Electricity Sale and Service Agreement is terminated and (b) Seller notifies Buyer that it has removed J. Aron as its agent, Buyer may no longer rely on notices or other actions taken by J. Aron.

Attachment Staff Report Item 15D
14 ARTICLE III.

SALE AND PURCHASE
Section 3.1 Sale and Purchase of Product.
(a) Seller shall cause to be sold and delivered to Buyer, and Buyer hereby purchases and shall receive, or cause to be received, from the Delivering Entity, the applicable Product in the quantities and at the times and subject to the terms and conditions set forth in this Agreement. The quantities of Product to be sold and purchased and delivered and received pursuant to the terms and conditions set forth in this Agreement shall be equal to (a) the Base Quantity, if any, for each Delivery Hour and (b) the Assigned Quantity delivered to J. Aron in each Month of the Delivery Period pursuant to the Assignment Agreements. Any such sale is made pursuant to and in accordance with the Seller Tariff. The Parties acknowledge and agree that Seller’s delivery obligation for (i) Assigned Products will be measured on an annual basis and (ii) Base Product will be measured on an hourly basis as set forth in the terms of this Agreement. (b) In recognition that Seller will have increased floating price payment obligations to the Swap Counterparty under the Seller Swap with respect to negatively priced Energy and the Swap Counterparty will have increased floating price payment obligations to Buyer under the Buyer Swap with respect to negatively priced Energy, the Parties acknowledge and agree that Seller shall have no payment obligations to Buyer with respect to negatively priced Energy.

Furthermore, with respect to any negatively priced Energy remarketed pursuant to this Agreement, Seller’s payment obligations under Exhibit C shall be reduced to the extent that such Energy is negatively priced.
(c) Buyer acknowledges and agrees that (A) subsequent to the execution hereof, Seller may delegate all of its Product sale delivery and Scheduling obligations under this Agreement to J. Aron as the Delivering Entity hereunder pursuant to the Electricity Sale and Service Agreement; (B) upon the effectiveness of any such designation of J. Aron as the Delivering Entity, all Product sale, delivery and Scheduling obligations shall be performed by J. Aron as the Delivering Entity pursuant to and in accordance with the Delivering Entity Tariff and the Electricity Sale and Service Agreement; (C) to the extent J. Aron is designated as the Delivering Entity, Seller shall have no obligation to sell, deliver or Schedule Product hereunder, and Buyer accordingly waives any and all rights to maintain an action against Seller for specific performance of (x) the Delivering Entity’s Product delivery and Scheduling obligations or (y) Seller’s obligation to cause Products to be sold and delivered; and (D) in such case, J. Aron as the Delivering Entity may identify (x) Buyer as the entity to which it makes Product sales and (y) the Electricity Sale and Service Agreement as the contract pursuant to which it makes Product sales to Buyer in the Delivering Entity’s electric quarterly reports and other submissions required to be filed with FERC. Notwithstanding the foregoing, any payment obligations under this Agreement relating to a failure to deliver or remarketing of Product shall remain Seller’s sole obligation, and Buyer agrees that it shall have no recourse whatsoever against J. Aron for such amounts. The Delivering Entity shall be a third-party beneficiary of this Agreement with the right to rely upon and enforce the terms hereof relating to the Delivering Entity’s rights and obligations.

Attachment Staff Report Item 15D
15 (d) Seller is the initial Delivering Entity under this and the provisions of Section

3.1(c) regarding the delegation of Seller’s Product sale and delivery obligations shall apply only to the extent that Seller subsequently designates J. Aron as the Delivering Entity in accordance with the terms hereof.
(e) Buyer hereby acknowledges and agrees that Seller has delegated its remarketing obligations under Exhibit C to J. Aron pursuant to the Electricity Sale and Service Agreement, the term “Remarketing Entity” shall be used herein to refer to J. Aron in its role performing such remarketing obligations and J. Aron shall continue to act as the Remarketing Entity hereunder regardless of any change in the Delivering Entity pursuant to the terms hereof.

Section 3.2 Limited Obligation to Take Base Quantities. Notwithstanding anything to the contrary in this Agreement, Buyer shall not be required to purchase and receive any Base Quantities hereunder, and Seller will remarket any Base Quantities that otherwise would be delivered hereunder pursuant to the provisions of Exhibit C.

Section 3.3 Prepayment. Prior to the commencement of the Delivery Period and subject to Buyer’s issuance of the Bonds, Buyer shall pay an amount equal to the Prepayment as payment to Seller for all Product (other than Monthly Excess Quantities) to be delivered during the Delivery Period, and Seller shall accept the Prepayment as payment in full for all Product to be delivered hereunder. Buyer shall pay the Prepayment in a single lump sum payment by wire transfer of immediately available funds to an account designated by Seller. In no event shall Buyer be entitled to any rebate or refund of the Prepayment, but nothing in this Section 3.3 shall limit Buyer’s rights under (i) Article IV for Seller’s failure to Schedule or deliver Product (whether or not excused), (ii) Article XVII upon early termination of this Agreement or deliveries of Product or (iii) Exhibit C with respect to remarketing of Product in accordance therewith.

Section 3.4 Other Amounts Payable with Respect to Assigned Product. With respect to Monthly Excess Quantities delivered by the Delivering Entity, Buyer shall pay Seller an amount equal to the quantity of such Monthly Excess Quantities, as applicable, multiplied by the contract price then in effect under the applicable Assigned PPA for such Monthly Excess Quantities; provided that the Parties acknowledge and agree that the Project Participant’s payment of the [Ava Gross Payment] (as defined in the PPA Custodial Agreement) shall be deemed to satisfy Buyer’s payment obligation hereunder with respect to any such Monthly Excess Quantities.

To the extent the Project Participant fails to pay any amounts when due under the PPA Custodial Agreement with respect to Monthly Excess Quantities, Buyer shall promptly transfer the resulting Excess Receivables (as defined in Exhibit E) to Seller, and the transfer of such Excess Receivables shall satisfy Buyer’s payment obligation with respect thereto.

ARTICLE IV.

FAILURE TO SCHEDULE PRODUCT
Section 4.1 Assigned Product. Notwithstanding anything herein to the contrary, neither Seller nor Buyer shall have any liability or other obligation to one another under this Agreement for any failure to Schedule, take, or deliver Assigned Product other than as set forth in Section 12 of Exhibit C for any failure to Schedule, take or deliver Assigned Product.

Attachment Staff Report Item 15D
16 Section 4.2 Failure to Deliver or Take Due to Force Majeure. If with respect to all or any portion of Base Quantities:
(a) Buyer fails to Schedule or receive, or cause to be Scheduled and received, or the Delivering Entity fails to Schedule or deliver, or cause to be Scheduled and delivered, all or any portion of such quantities at any Delivery Point pursuant to the terms of this Agreement; and (b) such failure is due to Force Majeure claimed by either Party, then Seller shall pay to Buyer the result determined by the following formula with respect to each such Delivery Point:

P = Q x IP
Where:

P = The amount payable by Seller under this Section 4.2; Q = The quantity of Energy described in the lead-in to this Section 4.2; and
IP = The Day-Ahead Market Price applicable to the Delivery Hour and the Delivery Point with respect to any such Base Quantities.

The Parties acknowledge and agree that any failure to deliver the Annual Quantity of Assigned Product, whether or not due to Force Majeure, is subject to the terms of Section 12 of Exhibit C.

Section 4.3 Sole Remedies. Except with respect to (i) termination of this Agreement pursuant to Section 17.4 and (ii) the obligations of the Delivering Entity under Section 8(b) of Exhibit C, the remedies set forth in this Article IV shall be each Party’s sole and exclusive remedies for any failure by the other Party to Schedule, deliver or receive Product, as applicable, pursuant to this Agreement.

ARTICLE V.

DELIVERY POINTS; SCHEDULING
Section 5.1 Delivery Points.
(a) Base Delivery Points. All Base Product delivered under this Agreement shall be Scheduled for delivery to and receipt at (i) the CAISO delivery point set forth in Exhibit A-1 (the “Primary Delivery Point”) or (ii) any other CAISO delivery point (an “Alternate Delivery Point”) that has been mutually agreed by Buyer, the Project Participant, and Seller (the Primary Delivery Point or, to the extent specified, any Alternate Delivery Point being the “Base Delivery Point”). Delivery of Energy to Seller at the Primary Delivery Point shall be facilitated through submission of Inter-SC Trades, as defined in the CAISO Tariff (“ISTs”). Seller shall designate a scheduling coordinator in the CAISO market for this purpose as specified in Exhibit G.

Attachment Staff Report Item 15D
17 (b) Alternate Base Market Prices. The Day-Ahead Market Price and Real-Time Market Price for each Alternate Delivery Point, as applicable, shall be the price mutually agreed and identified by the Parties, or if no such price is identified for such Alternate Delivery Point, the price shall be the Day-Ahead Market Price and Real-Time Market Price, as applicable, specified on Exhibit A-1 for the Primary Delivery Point from which quantities are being shifted to such Alternate Delivery Point.
(c) Assigned Energy Delivery Points. Assigned Energy delivered by the Delivering Entity to Buyer under this Agreement shall be Scheduled for delivery to and receipt at the applicable Assigned Delivery Point specified in the applicable Assignment Schedule. 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. (d) Updates to Swap Exhibits. If the Parties at any time amend Exhibit A-1 and/or Exhibit A-2, the Parties shall promptly notify the Swap Counterparty of any such amendment and furthermore shall update the corresponding exhibits to the Buyer Swap and the Seller Swap in accordance with the terms thereof.

Section 5.2 Transmission and Scheduling. Seller shall Schedule or arrange for Scheduling services with CAISO in accordance with the CAISO Tariff, to deliver the Base Product to the Base Delivery Point. Buyer shall Schedule or arrange for Scheduling services with CAISO in accordance with the CAISO Tariff, to receive the Base Product at the Base Delivery Point. If the J. Aron Schedules or arranges for Scheduling services for the delivery of the Base Product at the Base Delivery Point, then Seller’s obligations under this Section shall be relieved pro tanto. If the Project Participant Schedules or arranges for Scheduling services to receive the Base Product at the Base Delivery Point, then Buyer’s obligations under this Section shall be relieved pro tanto.

Scheduling of Assigned Energy shall be in accordance with the applicable Assignment Schedule.

Section 5.3 Title and Risk of Loss. Title to and risk of loss of the Energy delivered under this Agreement shall pass from the Delivering Entity to Buyer at the applicable Delivery Point. The transfer of title and risk of loss for all Assigned Product 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. Seller warrants that it will deliver to Buyer the Base Quantity of Product free and clear of all liens, security interests, claims and encumbrances or any interest therein or thereto by any person arising prior to the Delivery Point. Subject to Section 18.1, each Party shall indemnify, defend and hold harmless the other Party from and against any Claims made by a third party arising from or out of any event, circumstance, act or incident related to the Energy delivered hereunder first occurring or existing during the period when control and title to Base Product or Assigned Product is vested in the indemnifying Party as provided in this Section 5.3; provided that, notwithstanding the foregoing, (a) Seller shall have no obligations to indemnify, defend or hold harmless Buyer for any such Claims relating to replacement costs, cover damages or similar liabilities that are payable to the Project Participant or other Person because of Buyer’s failure to deliver any Product to the Project Participant or other Person through no fault of Seller and (b) no obligation to indemnify, defend or hold harmless shall supplant or control the provisions of this Agreement relating to Force Majeure. Notwithstanding anything to the contrary herein, no Party shall have any obligations to Attachment Staff Report Item 15D
18 indemnify, defend or hold harmless the other Party in respect of any Claims relating to any Assigned Product.

Section 5.4 PCC1 Product, Long-Term PCC1 Product and PCC2 Product. To the extent that any Assigned Product is PCC1 Product, Long-Term PCC1 Product or PCC2 Product, the following provisions apply:
(a) Eligibility. Seller, and, if applicable, its successors, represents and warrants that throughout the Delivery Period of this Agreement that: (i) the Clean Energy Project qualifies and is certified by the CEC as an Eligible Renewable Energy Resource as such term is defined in Public Utilities Code Section 399.12 or Section 399.16; and (ii) the Clean Energy 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, any capitalized terms not otherwise defined herein shall have the meaning specified in the Assigned PPA. (b) Transfer of Renewable Energy Credits. Seller and, if applicable, its successors, represents and warrants that throughout the Delivery Period 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, any capitalized terms not otherwise defined herein shall have the meaning specified in the Assigned PPA.
(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, any capitalized terms not otherwise defined herein shall have the meaning specified in the Assigned PPA.
(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 Attachment Staff Report Item 15D
19 connection with this Agreement. [STC 17, Non-Modifiable. (Source: D.07-11- 025, Attachment A) D.08-04-009].
(e) Seller Representations and Warranties.

Seller represents and warrants:
(i) Seller has the right to sell the Assigned Product from the Applicable Project;
(ii) Seller has not sold the Assigned Product or any REC or other attributes of the Assigned Product to be transferred to Buyer to any other person or entity;
(iii) The Energy component of the Assigned Product produced by the Applicable Project and purchased by Seller for resale to Buyer hereunder is not being sold by Seller back to the Applicable Project or APC Party;
(iv) Assigned Product to be purchased and sold pursuant to this Agreement has not been committed to another party;
(v) The Assigned Product is free and clear of all liens or other encumbrances;
(vi) Seller will deliver to Buyer all Assigned Energy and associated RECs generated by the Applicable Project for PCC1 Product in compliance with the requirements set forth in California Public Utilities Code Section 399.16(b)(1) and the California RPS compliance requirements for Portfolio Content Category 1 as set forth in CPUC Decision 11-12-052, if applicable;
(vii) Seller will deliver to Buyer all Assigned Energy and associated RECs generated by the Applicable Project for PCC2 Product in compliance with the requirements set forth in California Public Utilities Code 399.16(b)(2) and the California RPS compliance requirements for Portfolio Content Category 2 as set forth in CPUC Decision 11-12-052, if applicable;
(viii) Seller will deliver to Buyer 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;
(ix) The Assigned Product supplied to Buyer 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
(x) Seller will cooperate and work with Buyer, the CEC, and/or the CPUC to provide any documentation required by the CPUC or CEC Attachment Staff Report Item 15D
20 to support the Product’s classification as a Portfolio Content Category 1 Product or Portfolio Content Category 2 Product, as applicable, as set forth in California Public Utilities Code Sections 399.16(b)(1) or 399.16(b)(2), if applicable, or compliance with the California Long-Term Contracting Requirements, if applicable.

Seller further represents and warrants to Buyer that, to the extent that the PCC1 Product sold by Seller is a resale of part or all of a contract between Seller and one or more third parties, Seller represents, warrants and covenants that the resale complies with the following conditions in (i) through (iv) below throughout the Assignment 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 Buyer 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.

Attachment Staff Report Item 15D
21 (f) Subsequent Changes in Law. In the event that the qualifications or requirements of the RPS program, PCC1 Product, PCC2 Product or the California Long-Term Contracting Requirements change, Seller shall take commercially reasonable actions to meet the amended qualifications or requirements of the RPS Law, PCC1 Product, PCC2 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, PCC2 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) Seller has relied exclusively upon the representations and warranties of each respective APC Party set forth in the Assigned PPAs in making the representations and warranties set forth in this Section 5.4 and has not performed any independent investigation with respect thereto; (ii) J. Aron has agreed under the Electricity Sale and Service Agreement 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;
(iii)Buyer 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 Buyer shall have no other recourse against Seller or remedies under this Agreement; and
(iv)Section 5.4(d) shall only apply to the provisions of this Section 5.4 and all other provisions of this Agreement shall remain subject to and interpreted in accordance with Section 18.4.

Section 5.5 Communications Protocol. With respect to the Scheduling and delivery of Base Quantities, Buyer shall comply and Prepay LLC shall cause the Delivering Entity to comply with the communications protocol set forth in Exhibit G. Scheduling and transmission of Assigned Energy shall be in accordance with the applicable Assignment Agreement pursuant to which the Project Participant shall act as scheduling agent for each of J. Aron, Seller and Buyer.

Section 5.6 Deliveries Within CAISO or Another Balancing Authority. The Parties acknowledge that Energy delivered by Seller at a Delivery Point within CAISO or another Balancing Authority (including a Balancing Authority operating within the Western EIM) 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 Product into the applicable Balancing Authority shall constitute delivery of such Product to Buyer hereunder, provided that any associated Renewable Energy Credits and other Assigned Product associated with the Energy are also delivered to Buyer hereunder.

Section 5.7 Assigned Product. Notwithstanding anything to the contrary herein, Seller shall have no liability under this Article V with respect to any Assigned Product.

Attachment Staff Report Item 15D
22 ARTICLE VI.

ASSIGNMENT OF POWER PURCHASE AGREEMENTS
Section 6.1 Assignments Generally. The Project Participant and the Buyer have agreed pursuant to [Article VI of the Clean Energy Purchase Contract] that (a) prior to the commencement of the Delivery Period, the Project Participant will exercise Commercially Reasonable Efforts to assign the Initial Assigned Rights and Obligations to J. Aron, and (b) in the event of (i) any expiration, termination or anticipated termination of the Assignment Period for the Initial Assigned Rights and Obligations or any subsequent EPS Energy Period or (ii) a failure to assign any portion of the Initial Assigned Rights and Obligations, the Project Participant is obligated to exercise Commercially Reasonable Efforts and cooperate with J. Aron in good faith to assign certain Replacement Assigned Rights and Obligations to J. Aron and, under certain circumstances specified in the Electricity Sale and Service Agreement, J. Aron shall have the ability to procure EPS Compliant Energy for ultimate redelivery to the Project Participant under the Electricity Sale and Service Agreement. Following the effectiveness of any Assignment Agreement and Assignment Schedule executed in connection with any Replacement Assigned Rights and Obligations or J. Aron’s procurement of EPS Compliant Energy consistent with [Section 6.1(c) of the Electricity Sale and Service Agreement], the Base Quantities shall be reduced as provided by [Article VI] and [Exhibit F of the Clean Energy Purchase Contract]. References to [Article VI] and [Exhibit F of the Clean Energy Purchase Contract] mean such provisions of the Clean Energy Purchase Contract (including any embedded definitions or cross-referenced provisions) as they originally exist, as modified, amended, supplemented or waived with the consent of J. Aron.

Section 6.2 Failure to Obtain EPS Compliant Energy. To the extent an EPS Energy Period terminates or expires and EPS Compliant Energy is not available for delivery hereunder upon such termination or expiration, then Seller shall remarket the Base Quantities pursuant to the provisions of Exhibit C until EPS Compliant Energy is available for delivery hereunder.

Section 6.3 Adjustments to Swaps. The Parties agree to issue appropriate notices to cause the Buyer Swap and the Seller Swap to be revised in connection with the commencement or termination of any Assignment Period such that the notional quantities under such swaps will be adjusted to be consistent with any changes to the Base Quantity determined pursuant to Section 6.4.

Section 6.4 Adjustments to Base Quantities. The Base Quantity Reductions set forth on Exhibit A-1 hereto have been calculated to reflect the Initial Assigned Rights and Obligations using the methodology described in [Exhibit F of the Clean Energy Purchase Contract]. Effective on the first day of the third Month following the early termination of an EPS Energy Period for any reason, Seller shall revise Exhibits A-1 and A-2 (i) as provided by [Article VI] and [Exhibit F to the Clean Energy Purchase Contract] to the extent a subsequent EPS Energy Period will commence on such date or (ii) to reverse such Base Quantity Reductions associated with the EPS Energy Period that terminated for all remaining Hours in the Delivery Period to the extent a replacement EPS Energy Period will not commence on such date. In the case of any other commencement of a subsequent EPS Energy Period, Seller shall revise (a) the Base Quantity Attachment Staff Report Item 15D
23 Reductions in Exhibit A-1 as provided by [Article VI] and [Exhibit F of the Clean Energy Purchase Contract] and (b) Exhibit A-2 to reflect the details for such EPS Energy Period.

Section 6.5 APC Party Make-Whole. Seller shall reimburse Buyer for any amounts owed by Buyer to the Project Participant pursuant to [Section 6.4 of the Clean Energy Purchase Contract] due to J. Aron’s failure to pay when due any J. Aron Prepay Payment under the PPA Custodial Agreement.

ARTICLE VII.

PRODUCT REMARKETING
Section 7.1 Product Remarketing. If the Project Participant is in default under the Clean Energy Purchase Contract or is unable to receive all or any portion of the Product purchased by Buyer under this Agreement due to (a) insufficient demand by the Project Participant’s retail customers, (b) the occurrence of an Assigned PPA FM Remarketing Event (as defined in Exhibit F), (c) a change in Law, or (d) the application of Section 3.2 requiring the remarketing of Base Quantities, and the Project Participant requests (or in the case of clauses (b) and (d), is deemed to have requested) remarketing services from the Remarketing Entity pursuant to the provisions of Exhibit C; provided that any remarketing request delivered under clause (c) above shall constitute a “Structural Remarketing Notice” and any Structural Remarketing Notice (i) must be provided at least six Months in advance of the requested remarketing services and (ii) shall be subject to Seller’s consent in its reasonable discretion. If Buyer requests remarketing of any Assigned Product under any of the circumstances described in the preceding sentence other than clause (b) thereof, then J. Aron will have the right to terminate the Assignment Period applicable to such Assigned Product effective as of the first Delivery Hour to which such remarketing applies. If J. Aron does not elect to terminate the Assignment Period, Buyer and Seller shall negotiate in good faith to adjust the provisions of Exhibit C to reflect pricing, delivery and other terms related to such Assigned Product, and the Remarketing Entity shall have no obligation to remarket such Assigned Product unless and until Buyer and the Remarketing Entity have mutually agreed to such adjustments to Exhibit C. The Remarketing Entity has agreed to observe and perform its obligations set forth in Exhibit C.

ARTICLE VIII.

REPRESENTATIONS AND WARRANTIES
Section 8.1 Representations and Warranties. 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 Buyer as the representing Party, Buyer is a joint powers authority duly organized and validly existing under the laws of the State of California; (b) for Seller as the representing Party, it is duly organized, validly existing and in good standing under the Laws of the state in which it is organized and in good standing in the State of California;
Attachment Staff Report Item 15D
24 (c) it has all requisite power and authority, corporate or otherwise, to own its material properties, carry on its material business as now being conducted, enter into, deliver and to perform its obligations under this Agreement and to carry out the terms and conditions hereof and the transactions contemplated hereby;
(d) there is no litigation, action, suit, proceeding with service of process accomplished with respect to such Party or investigation pending or, to the best of such Party’s knowledge, threatened, in each case before or by any Government Agency and, in each case, which could reasonably be anticipated to materially and adversely affect such Party’s ability to perform its obligations under this Agreement or that questions the validity, binding effect or enforceability 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 have been duly authorized by all necessary action on the part of such Party and do 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, order, writ, judgment, 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 Buyer, the lien of the Trust Indenture;
(i) to the best of the knowledge and belief of such Party, no Governmental Approval 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 Governmental Approvals 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.

Attachment Staff Report Item 15D
25 Section 8.2 Additional Representations and Warranties of Buyer. As a material inducement to entering into this Agreement, Buyer hereby represents and warrants to Seller as of the Execution Date as follows:
(a) Buyer is entering into this Agreement for the purpose of acquiring Product for sale to the Project Participant pursuant to the Clean Energy Purchase Contract; and (b) any amounts payable by Buyer under this Agreement shall (i) other than the Prepayment, be payable as an item of [Operating Expense] under (and as defined in) the [Trust Indenture], and (ii) not constitute an indebtedness or liability of Buyer within the meaning of any constitutional or statutory limitation or restriction applicable to Buyer.

Section 8.3 Funding Agreement.
(a) Except (i) to cure any ambiguity, supply any omission, or cure or correct any defect or inconsistent provision in a Funding Agreement, (ii) to insert such provisions clarifying matters or questions arising under a Funding Agreement as are necessary or desirable and are not contrary to or inconsistent therewith or (iii) to convert or supplement any provision in a manner consistent with the intent of a Funding Agreement and the other Transaction Documents, Seller agrees that it shall not (x) agree to any amendment, alteration, assignment or modification to any Funding Agreement or any guaranty of Funding Recipient’s obligations thereunder or (y) enter into any agreements with the initial Funding Recipient other than the Funding Agreement without receipt of (A) a Rating Confirmation and (B) the prior written consent of Buyer; provided that, for the avoidance of doubt, no such consent of Buyer shall be required in connection with (I) the replacement, refinancing or re-pricing of a Funding Agreement at the end of any Interest Rate Period or (II) Seller’s assignment of its interest in a Funding Agreement or consent to Funding Recipient’s assignment of its interest in a Funding Agreement by Funding Recipient to the extent Seller provides a Rating Confirmation to Buyer with respect to any such assignment. (b) To the extent an Early Termination Payment Date is designated hereunder, Seller agrees that it shall promptly withdraw the entire outstanding balance of principal and accrued interest under the Funding Agreement to the extent permitted by the terms thereof.

Section 8.4 Warranty of Title. Seller warrants that it will deliver to Buyer (a) all Base Product free and clear of all liens, security interests, claims and encumbrances or any interest therein or thereto by any Person arising prior to the Delivery Point, and (b) all Assigned Product free and clear of all liens, security interests, claims and encumbrances or any interest therein or thereto by any Person that are imposed on such Assigned Product solely as a result of Seller’s actions.

Section 8.5 Disclaimer of Warranties. EXCEPT FOR THE WARRANTIES

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

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

ARTICLE IX.

TAXES
Attachment Staff Report Item 15D
26 As between Seller and Buyer, Seller shall (i) be responsible for, and pay or cause to be paid, all ad valorem, excise, severance, production and other taxes assessed with respect to Product (other than any Assigned Product) delivered by the Delivering Entity or Seller, as applicable, pursuant to this Agreement arising prior to the applicable Delivery Point and (ii) indemnify Buyer and its Affiliates for any such taxes paid by Buyer or its Affiliates. As between Seller and Buyer, Buyer shall (i) be responsible for all taxes with respect to Product received pursuant to this Agreement assessed at or from the applicable Delivery Point, and (ii) indemnify Seller and its Affiliates for any such taxes paid by Seller or its Affiliates. Nothing shall obligate or cause a Party to pay or be liable for any tax for which it is exempt under Law.

ARTICLE X.

JURISDICTION; WAIVER OF JURY TRIAL
Section 10.1 Consent to Jurisdiction. ALL JUDICIAL PROCEEDINGS

BROUGHT AGAINST EITHER PARTY ARISING OUT OF OR RELATING HERETO

SHALL BE BROUGHT EXCLUSIVELY IN THE FEDERAL COURTS OF THE UNITED

STATES OF AMERICA FOR THE NORTHERN DISTRICT OF CALIFORNIA SITTING IN THE CITY AND COUNTY OF SAN FRANCISCO. BY EXECUTING AND DELIVERING

THIS AGREEMENT, EACH PARTY AGREES THAT SERVICE OF ALL PROCESS IN ANY

SUCH PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR

CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THE PARTY AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH Article XVI; AND AGREES THAT SERVICE AS

PROVIDED ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER

THE PARTY IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT.

Section 10.2 Waiver of Jury Trial. TO THE EXTENT PERMITTED BY LAW,

EACH OF THE PARTIES HEREBY AGREES TO WAIVE ITS RESPECTIVE RIGHTS TO A

JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING UNDER THIS AGREEMENT. THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT

AND THAT RELATE TO THE SUBJECT MATTER OF THIS AGREEMENT, INCLUDING

CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. EACH PARTY ACKNOWLEDGES THAT

THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS

RELATIONSHIP, THAT EACH HAS ALREADY RELIED ON THIS WAIVER IN

ENTERING INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO RELY ON THIS WAIVER IN ITS RELATED FUTURE DEALINGS. EACH PARTY FURTHER

WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS

LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. THIS

WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER

ORALLY OR IN WRITING (OTHER THAN BY MUTUAL WRITTEN WAIVER SPECIFICALLY REFERRING TO THIS Section 10.2 AND EXECUTED BY EACH OF THE

PARTIES), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS HERETO. IN THE EVENT OF Attachment Staff Report Item 15D
27 LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY A COURT.

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 and as provided in Section 4.2 and Section 17.4). The Claiming Party shall remedy 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.

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 over this Agreement or the transactions to be undertaken hereunder, 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 12.3 Defense of Agreement. Excluding all matters involving a contractual dispute between the Parties, each Party shall hereafter exercise Commercially Attachment Staff Report Item 15D
28 Reasonable Efforts to defend and support this Agreement before any Government Agency in any proceeding, if the substance, validity or enforceability of all or 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 subject either Party to any greater or different regulation or jurisdiction that materially affects the rights or obligations of the Parties under this Agreement.

ARTICLE XIII.

ASSIGNMENT
Neither Party shall assign this Agreement or any of its rights or obligations under this Agreement without the prior written consent of the other Party; provided, however, that:
(a) pursuant to the Trust Indenture, Buyer may, without the consent of Seller, transfer, sell, pledge, encumber or assign this Agreement to the Trustee in connection with any financing or other financial arrangements; provided that Buyer shall not assign this Agreement unless, contemporaneously with the effectiveness of such assignment, Buyer also assigns the Buyer Swap (and the Buyer Swap Custodial Agreement) to the same assignee; (b) upon written notice to Buyer, Seller may, without Buyer’s consent, assign this Agreement to an Affiliate of Seller, which assignment shall constitute a novation; provided that the assignee shall agree in writing to be bound by the terms and conditions of this Agreement and Seller shall not assign this Agreement unless (i) Seller delivers a Rating Confirmation to Buyer with respect to such assignment, (ii) contemporaneously with the effectiveness of such assignment, Seller also assigns the Seller Swap, the Seller Swap Custodial Agreement and the SPE Master Custodial Agreement to the same assignee and either (A) Seller assigns the Funding Agreement and Electricity Sale and Service Agreement to the same assignee or (B) the assignee provides to Buyer a guarantee of its obligations by [GSG] (as defined in the Electricity Sale and Service Agreement) and [GSG] continues to guarantee J. Aron’s performance under the Electricity Sale and Service Agreement, and (iii) the assignee is a special purpose entity approved by Buyer or its obligations under this Agreement are guaranteed by Funding Recipient to the satisfaction of Buyer; and
(c) if (i) Seller notifies Buyer that the Funding Agreement will not be replaced, refinanced or re-priced as of the end of any Interest Rate Period or (ii) Seller is unable to provide, under the Re-Pricing Agreement, an estimated [Available Discount Percentage] (as defined in the [Re-Pricing Agreement]) that is equal to or greater than the applicable Minimum Discount Percentage under the Clean Energy Purchase Contract, then, at the request of Buyer, Seller will reasonably cooperate with Buyer to cause Seller’s (or Seller’s Affiliate’s, if applicable) interest in this Agreement, the Re-Pricing Agreement, the Seller Swap, the Seller Swap Custodial Agreement, the SPE Master Custodial Agreement and any Specified Investment Agreement with a term that extends past the then-current Interest Rate Period to which Seller or any Affiliate is a party and all agreements related to any of the foregoing (the “Transaction Documents”) to be novated to a replacement seller; provided that (x) a Rating Confirmation is obtained for any Bonds required to be redeemed on the first Mandatory Purchase Date following the effective date of such novation, (y) the Swap Counterparty shall have provided its prior written consent to such novation in Attachment Staff Report Item 15D
29 accordance with the terms of the Seller Swap to which it is a party, and (z) after giving effect to such novation, Seller will have no obligations (contingent or otherwise, including any obligation to make or repeat any representations or warranties other than basic representations on authority and the right to transfer its interests under this Agreement without encumbrances) or be required to make any payment under any Transaction Document or otherwise in connection with or following such novation other than any obligations that would have existed or payments that would have been required had this Agreement terminated as of the end of the last Reset Period that commenced prior to such novation.

ARTICLE XIV.

PAYMENTS
Section 14.1 Monthly Statements.
(a) Buyer’s Statements. 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, Buyer shall deliver to Seller a statement (a “Buyer’s Statement”) listing any amounts due to Buyer in connection with this Agreement with respect to the prior Months.
(b) Billing Statements.
(i) No later than the 20th 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, Seller shall deliver a statement (a “Billing Statement”) to Buyer and the Project Participant indicating (i) the total amount due to Buyer, if any, under Article IV, Article V, Article VI, Article VII and Exhibit C with respect to the prior Months, (ii) any amounts due to Seller in connection with this Agreement with respect to the prior Months, and (iii) the net amount due to Buyer or Seller; provided that, notwithstanding the foregoing, invoicing for Monthly Excess Quantities shall occur under the PPA Custodial Agreement. The Parties acknowledge and agree that Seller may consolidate Billing Statements under this Agreement with billing statements delivered by Affiliates of Seller under other master power supply agreements between Buyer and Affiliates of Seller. (ii) For each Month of any Assignment Period, the Billing Statement prepared by Seller shall assume that all of the Monthly Projected Quantities were delivered under each Assigned PPA for such Month, and any subsequent resettlements required with respect thereto shall occur under the PPA Custodial Agreement. To the extent that a [Monthly Statement] (as defined in the [PPA Custodial Agreement]) for an Assigned PPA delivered under the PPA Custodial Agreement reflects that less than the Monthly Projected Quantities were actually delivered under any such Assigned PPA, then (A) the previously delivered Billing Statement shall be deemed to be updated in accordance with such Monthly Statement, and (B) Seller shall owe a resettlement payment to Buyer in an amount equal to the Provisional Payment that would have applied to such under-delivery pursuant to the terms of Section 12 of Exhibit C. The Parties acknowledge and agree that J. Aron shall have a separate resettlement payment obligation under the Electricity Sale and Service Attachment Staff Report Item 15D
30 Agreement with respect to the amounts described in clause (B) of the preceding sentence, and J. Aron’s payment of the [Ava Reimbursement Amount] as defined in and pursuant to the [PPA Custodial Agreement] shall satisfy the corresponding obligations of the respective parties under each of the Electricity Sale and Service Agreement, this Agreement and the Clean Energy Purchase Contract.
(iii) The Parties acknowledge and agree that all amounts owed to and from Seller in connection with the Clean Energy Project shall be paid pursuant to the SPE Master Custodial Agreement, and the Billing Statement may be provided by J. Aron, as Seller’s agent, in the form of a consolidated statement regarding all amounts owed to and from Seller in connection with the Clean Energy Project for each Month, including payments to be made under this Agreement, the Funding Agreement, the Electricity Sale and Service Agreement and the Seller Swap.
(c) Supporting Documentation. Upon request by either Party, the other Party shall deliver such supporting documentation of the foregoing statements and information described in this Section 14.1 as such requesting Party may reasonably request.

Section 14.2 Payment.
(a) Payments Due. If the Billing Statement indicates an amount due from Buyer, then Buyer shall remit such amount to Seller by wire transfer (pursuant to the instructions set forth in the SPE Master Custodial Agreement), in immediately available funds, on or before the 25
th 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. If the Billing Statement indicates an amount due from Seller, then Seller shall remit such amount to Buyer by wire transfer (pursuant to Buyer’s instructions for payments due under this Agreement; provided that amounts due from Seller under Section 12 of Exhibit C shall be paid to the [Provisional Payments Account] under and as defined in the PPA Custodial Agreement) in immediately available funds, on or before the 24 th 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. In addition to the foregoing, the Parties acknowledge that amounts due with respect to Monthly Excess Quantities shall be settled in accordance with Section 3.4 hereto.
(b) No Duty to Estimate. If Buyer fails to issue a Buyer’s Statement with respect to any Month, Seller shall not be required to estimate any amounts due to Buyer for such Month, provided that Buyer may include any such amount on subsequent Buyer’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 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. If Seller disputes any amounts included in a Buyer’s Statement, Seller shall (a) (except in the case of manifest error) nonetheless calculate the Billing Statement based on the amounts included in Buyer’s Statement and (b) 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 Seller may have; provided, however, that Seller shall have the right, after payment, to dispute any amounts included Attachment Staff Report Item 15D
31 in a Buyer’s Statement or otherwise used to calculate payments due under this Agreement pursuant to Section 14.5. If Buyer disputes any amounts included in the Billing Statement, Buyer 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.

Section 14.4 Late Payment. If a Party owing a net payment under Section 14.2 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) Right To Audit. 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; provided that, notwithstanding the foregoing, to the extent any such examination and audit reveals any material discrepancy in the other Party’s books and records, the examining Party shall have a right to be reimbursed by the other Party for costs reasonably incurred with such examination and audit.
(b) Deadline for Objections. Each Buyer’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 Buyer’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 Product delivery.
(c) Payment of Adjustments. All retroactive adjustments shall be paid in full by the Party owing payment within 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(a), 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 incorrect Buyer’s Statements or Billing Statements shall bear interest at the Default Rate from the date such payment was made. To the extent necessary to allow Seller to verify any amounts due under this Agreement, Buyer shall cause the Project Participant to comply with the provisions of Section 14.5(a) to the extent necessary to allow Seller to verify any amounts due under this Agreement.

Section 14.6 Netting. 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, no Party shall be entitled to net (i) any amounts that are in dispute or (ii) any payments due to Seller against (A) the Termination Payment if it becomes due or (B) any payments due from Seller pursuant to Article IV, Article V or Exhibit C.

Attachment Staff Report Item 15D
32 ARTICLE XV.

RECEIVABLES PURCHASES
Subject to the terms set forth in Exhibit E, Seller has the obligation to purchase Put Receivables (as defined in Exhibit E) and the option to purchase Payment Deficiency Call Receivables and Swap Deficiency Call Receivables (each as defined in Exhibit E). The Parties acknowledge and agree that (a) any Payment Deficiency Call Receivables and Swap Deficiency Call Receivables purchased by Seller under Exhibit E shall be re-purchased by J. Aron from Seller to the extent the conditions set forth in [Exhibit C] of the Electricity Sale and Service Agreement are satisfied (provided that any Payment Deficiency Call Receivables purchased by Seller pursuant to Section 2.3(c) of Exhibit E shall be transferred by Seller to J. Aron as a credit against amounts due from Seller to J. Aron under the Electricity Sale and Service Agreement); and (b) the purchase of any Put Receivables by Seller will be funded solely from amounts available, if any, under the SPE Master Custodial Agreement for such purpose.

ARTICLE XVI.

NOTICES
Any notice, demand, statement or request required or authorized by this Agreement to be given by one Party to the other Party (or to any third party) shall be in writing and shall either be sent by email transmission, courier, or personal delivery (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) 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 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, such as electronic mail. Notwithstanding the foregoing, either Party may at any time notify the other 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 Product Delivery Termination Events and Termination Payment Events. Each event listed on the table below constitutes a “Product Delivery Termination Event”.

This table also specifies the potential Terminating Party for each Product Delivery Termination Event and identifies which Product Delivery Termination Events are also “Termination Payment Events” and the potential Terminating Party for each Product Delivery Termination Event. For each Product Delivery Termination Event where the potential Terminating Party is listed as Attachment Staff Report Item 15D
33 “Automatic”, such event is an “Automatic Product Delivery Termination Event” and each other Product Delivery Termination Event is an “Optional Product Delivery Termination Event.” [Table on following page.]
Attachment Staff Report Item 15D
34 Event Related to:

Product Delivery
Termination Event:

Potential
Terminating
Party:

Termination
Payment
Event?
a) Failure of Seller to
pay Buyer due to
Funding Recipient
failure to pay
Seller
Seller fails to pay when due any amounts owed to Buyer pursuant to this Agreement because of a failure by Funding Recipient to pay when due any amounts owed to Seller pursuant to the Funding Agreement and such failure continues for 30 days after receipt by Seller and Funding Recipient of notice thereof from Buyer.

Automatic Yes
b) Failure of bond
remarketing or re-pricing
As of one week prior to the beginning of the first Month following a Reset Period, either:
(i) Buyer has not entered into a bond purchase agreement, firm remarketing agreement or similar agreement with respect to the remarketing or refunding of the existing Bonds; or
(ii) The initial Funding Recipient or successor Funding Recipient and Seller are unable to replace, refinance or re-price the Funding Agreement for a subsequent Reset Period.

Automatic Yes
c) Failure to
remarket
A Failed Remarketing occurs. Automatic Yes
d) Ledger Event The occurrence of a Ledger Event. Seller No e) Failure to
purchase
Identified
Receivables (as
defined in Exhibit
E)
Both:
(i) Seller has received a Swap Deficiency Call Receivables Offer (as defined in Exhibit E) pursuant to Section 2.2(a) of the Exhibit E and
(ii) Seller has not exercised or is deemed not to have exercised its related option to purchase the Identified Receivables described in such Swap Deficiency Call Receivables Offer.

Automatic No
f) CEPC
Remarketing
Termination
The occurrence of an [Automatic Non-Default Termination Event] under and as defined in the Electricity Sale and Service Agreement.

Automatic Yes
g) Termination of
Electricity Sale
and Service
Agreement and
Both:
(i) an [Early Termination Date] occurs due to a [J. Aron Default] (as each such term is defined under the Electricity Sale and Service Agreement) under the Electricity Sale and Service Agreement, and
Automatic No
Attachment Staff Report Item 15D
35 Event Related to:

Product Delivery
Termination Event:

Potential
Terminating
Party:

Termination
Payment
Event?
Failure to Replace
J. Aron
(ii) Seller is unable to enter into a replacement Electricity Sale and Service Agreement with substantially the same terms or terms approved by Buyer by the date that is 120 days following such [Early Termination Date] as defined and occurs under the Electricity Sale and Service Agreement.

For the avoidance of doubt, Seller may only enter into such a replacement Electricity Sale and Service Agreement if (I) the [GSG Guaranty] (as defined in the Electricity Sale and Service Agreement) applies to the obligations of the replacement seller thereunder or (II) Seller delivers a Rating Confirmation to Buyer with respect to its entry into such replacement Electricity Sale and Service Agreement.
h) Termination of
Electricity Sale
and Service
Agreement and
Failure to Replace
J. Aron
Both:
(i) an [Early Termination Date] (as defined under the Electricity Sale and Service Agreement) occurs under the Electricity Sale and Service Agreement for any reason other than as specified in clauses (f) and (g) above, and (ii) Seller is unable to enter into a replacement Electricity Sale and Service Agreement with substantially the same terms or terms approved by Buyer by the date that is 120 days following such [Early Termination Date] as defined and occurs under the Electricity Sale and Service Agreement.

Seller shall not enter into such a replacement Electricity Sale and Service Agreement unless (I) the [GSG Guaranty] (as defined in the Electricity Sale and Service Agreement) applies to the obligations of the replacement seller thereunder or (II) Seller delivers a Rating Confirmation to Buyer with respect to its entry into such replacement Electricity Sale and Service Agreement.

Automatic No
i) Termination of a
Buyer Swap
Except in the case where an Automatic Product Delivery Termination Event has occurred under Sections 17.1(e) [Failure to Purchase Identified Call Receivables],

17.1(f)-(h) [Termination of Electricity Sale and Service Agreement], 17.1(j) [Termination of a Buyer Swap for Certain Buyer Defaults], 17.1(k) [Termination of Seller Swap for Seller Defaults] or 17.(l) [Dissolution or Bankruptcy of Buyer], both:
(i) an [Early Termination Date] (as defined in a Buyer Swap) is designated by a Swap Counterparty pursuant to the terms of a Buyer Swap or occurs automatically pursuant to Seller No
Attachment Staff Report Item 15D
36 Event Related to:

Product Delivery
Termination Event:

Potential
Terminating
Party:

Termination
Payment
Event?
the terms of a Buyer Swap based on a [Termination Event] where Buyer is the sole [Affected Party] (as each term is defined in the Buyer Swap), and (ii) either the corresponding Seller Swap or such Buyer Swap is not replaced within the Swap Replacement Period.
j) Termination of a
Buyer Swap for
Certain Buyer
Defaults and
Termination
Events
An [Early Termination Date] (as defined in the Buyer Swap) is designated by a Swap Counterparty pursuant to the terms of a Buyer Swap based on an [Event of Default] under [Section 5(a)(vii)] (Bankruptcy) of a Buyer Swap where Buyer is the [Defaulting Party] (as each term is defined in the Buyer Swap).

Automatic No
k) Termination of a
Seller Swap for
Seller Defaults
and Termination
Events
Both:
(i) an [Early Termination Date] (as defined in the Seller Swap) is designated by a Swap Counterparty pursuant to the terms of a Seller Swap based on an [Event of Default] where Seller is the [Defaulting Party] or a [Termination Event] where Seller is the sole [Affected Party] (as each term is defined in the Seller Swap) or otherwise occurs automatically pursuant to the terms of a Seller Swap, but excluding any termination as a result of the termination of this Agreement based on a Product Delivery Termination Event under Section 17.1(d) [Ledger Event] or Section 17.1(h) [Termination of a Buyer Swap], and
(ii) such Seller Swap or the corresponding Buyer Swap is not replaced within the Swap Replacement Period.

Automatic No
l) Dissolution or
Bankruptcy of
Buyer
If (i) an involuntary case or other proceeding shall be commenced against Buyer 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 shall be entered and continued unstayed and in effect, in any such event, for a period of 60 days; or (ii) if Buyer shall commence a Automatic No
Attachment Staff Report Item 15D
37 Event Related to:

Product Delivery
Termination Event:

Potential
Terminating
Party:

Termination
Payment
Event?
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 a bankrupt or insolvent, or shall consent 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, or if it shall file a petition or answer or consent seeking reorganization or relief under any applicable Federal or State law, or consent 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 Buyer or any substantial part of its property, or shall make an assignment for the benefit of creditors, or admit in writing its inability to pay its debts generally as they become due, or shall take corporate action in furtherance of any such action.

Attachment Staff Report Item 15D
38 Section 17.2 Payments Following a Ledger Event. Following the occurrence of a Ledger Event, Seller shall pay to Buyer any amounts that become payable from J. Aron to Seller pursuant to [Section 17.6 of the Electricity Sale and Service Agreement].

Section 17.3 Reserved.

Section 17.4 Remedies and Termination.
(a) Automatic Product Delivery Termination Event. Upon the occurrence of any Automatic Product Delivery Termination Event, a Product Delivery Termination Date shall be deemed to be designated as of the end of the Month in which such Automatic Product Delivery Termination Event occurs.
(b) Optional Product Delivery Termination Event. If at any time an Optional Product Delivery Termination Event has occurred and is continuing, then the Terminating Party, by notice to the other Party specifying the relevant Optional Product Delivery Termination Event, may designate a day not earlier than the last day of the Month in which such notice is deemed given under Article XVI as the Product Delivery Termination Date; provided, however, that with respect to an Optional Product Delivery Termination Event related to a Buyer Swap or Seller Swap, the Terminating Party may, at any time after the commencement of the Swap Replacement Period, conditionally designate a Product Delivery Termination Date, with such designation being conditioned upon (i) the termination and failure to replace either the corresponding Seller Swap or such Buyer Swap and (ii) the Product Delivery Termination Date occurring no earlier than the last day of the Month in which the Swap Replacement Period ends. (c) Effect of Product Delivery Termination Date. As of the Product Delivery Termination Date, (i) the Delivery Period shall end, (ii) the obligation of Buyer to Schedule or receive deliveries of Product from Seller under this Agreement shall terminate, and (iii) the obligation of Seller to Schedule or make any further deliveries of Product to Buyer under this Agreement shall terminate and, unless such Product Delivery Termination Date resulted from a Termination Payment Event, such obligation to deliver Product shall be replaced with a continuing obligation to make payment of the amounts set forth in Exhibit D-3 to Buyer until the earlier of (A) the Month in which a Termination Payment Event occurs and (B) the last due date for such payments under Exhibit D-3. For the avoidance of doubt, (i) except as set forth in this Section

17.4(c) and in Section 17.4(d), this Agreement will continue past a Product Delivery Termination Date, and (ii) a Termination Payment Event may arise contemporaneously with a Product Delivery Termination Date or at any time thereafter and the occurrence of a Product Delivery Termination Date shall not prevent the occurrence of a Termination Payment Event. (d) Early Termination Payment Date. A Termination Payment Event shall occur upon (i) a Product Delivery Termination Event that is specified as a Termination Payment Event in Section 17.1, (ii) a Funding Recipient Acceleration Option or (iii) a J. Aron Acceleration Option. Following a Termination Payment Event, Seller on the Early Termination Payment Date shall pay the Termination Payment to the Trustee pursuant to payment instructions issued by Buyer or, in the absence of such instructions, by wire transfer. Such amounts shall be paid together with interest thereon (before as well as after judgment) from (and including) the Early Termination Payment Date to (but excluding) the date such amount is paid, at the Default Rate. The obligation Attachment Staff Report Item 15D
39 of Seller to pay the Termination Payment on the Early Termination Payment Date is unconditional, irrespective of the validity or enforceability of this Agreement or any other agreement contemplated hereby, any waiver or consent by Buyer, or any other circumstances that might otherwise constitute a legal or equitable discharge of Seller or a defense of Seller to pay the Termination Payment. Seller waives all rights to set-off, counterclaim, recoupment and any other defenses that might otherwise be available to Seller with regard to Seller’s obligation to pay the Termination Payment on the Early Termination Payment Date. (e) Acknowledgement of Parties. The Parties acknowledge that it is impractical and difficult to assess actual damages as a result of a termination of the Delivery Period under this Agreement, and the Parties therefore agree that the payment of the Termination Payment or the continued payment of amounts specified in Exhibit D-3, as applicable, is a fair and reasonable pre-estimate of the actual damages that would be incurred by Buyer as a result of termination of the Delivery Period under this Agreement for any reason and is not a penalty. (f) Exclusive Termination Rights. Neither this Agreement nor the Delivery Period may be terminated for any reason except as specified in this Article XVII and in Section

2.2. Except with respect to amounts due for periods prior to the Product Delivery Termination Date, the continued payment of amounts required to be made under Section 17.4(c), and, as applicable, the payment of the Termination Payment shall be the sole and exclusive remedy for each Party upon the termination of the Delivery Period and this Agreement for any reason, including as a result of rejection of this Agreement by either Party in any bankruptcy proceedings. (g) Payment of Investment Agreement Breakage Costs. In the event that a payment in respect of breakage costs becomes due from Buyer under a Specified Investment Agreement due to the occurrence of an Early Termination Payment Date, Seller shall pay to Buyer an amount equal to the amount of such payment no later than the later of (A) one (1) Business Day prior to the date such payment is required to be paid by Buyer pursuant to such Specified Investment Agreement and (B) one (1) Business Day following receipt by Seller of a statement setting forth in reasonable detail the amount of such payment. In the event that a payment in respect of breakage costs becomes payable to Buyer under a Specified Investment Agreement due to the occurrence of an Early Termination Payment Date, Buyer shall pay to Seller an amount equal to the amount of such payment no later than one (1) Business Day following receipt of such payment by Buyer.

Section 17.5 Replacement of Swaps.
(a) Neither Party shall exercise any optional right it may have to terminate this Agreement as a result of the termination of any Seller Swap or any Buyer Swap without first complying with this Section 17.5. Each of Buyer and Seller agrees that it will not replace any Buyer Swap or Seller Swap, as applicable, unless the other Party is replacing its Buyer Swap or Seller Swap, as applicable, with the same replacement Swap Counterparty. (b) If:
(i) any Buyer Swap or any Seller Swap terminates,
Attachment Staff Report Item 15D
40 (ii) Buyer or Seller delivers a termination notice under a Buyer Swap or Seller Swap,
(iii) a Swap Counterparty delivers a termination notice under a Buyer Swap or Seller Swap, or
(iv) any Buyer Swap or any Seller Swap is otherwise reasonably anticipated to become subject to immediate termination, then each Party whose swap is affected shall notify the other Party of the existence of such circumstances and identify the affected Buyer Swap or Seller Swap (the “Affected Swap”). (c) Following receipt of a notice under Section 17.5(b), the Parties shall attempt to replace both the Affected Swap and the corresponding unaffected Seller Swap or Buyer Swap with the same Swap Counterparty (the “Unaffected Swap”) by:
(i) if a Buyer Swap and a Seller Swap with another Swap Counterparty are in effect and otherwise are not subject to termination, (A) exercise any rights they may have to increase their notional quantities under such Buyer Swap and Seller Swap in order to effect a replacement upon termination of the Affected Swap (which increase shall be deemed to be a replacement of both the Buyer Swap and Seller Swap for purposes of Section 17.5 if the full notional quantities of the Affected Swap are thereby replaced), and (B) subsequent to such a replacement, Seller and Buyer shall cooperate in good faith to locate replacement agreements with a second Swap Counterparty and, upon locating a second Swap Counterparty, Seller and Buyer shall reduce their notional quantities under the remaining Seller Swap and Buyer Swap to their original levels and enter into a replacement Seller Swap and Buyer Swap with the replacement Swap Counterparty for the remaining notional quantities; or
(ii) to the extent Seller or Buyer cannot increase their notional quantities under another Buyer Swap and Seller Swap as contemplated by clause (i), cooperate in good faith to locate replacement agreements with an alternate Swap Counterparty to replace both the relevant Seller Swap and relevant Buyer Swap within the Swap Replacement Period.
(d) The “Swap Replacement Period” is a period (i) commencing on the earlier of the date of (x) any termination of a Buyer Swap or Seller Swap designated by a Swap Counterparty, and (y) delivery of a notice of anticipated termination of a Buyer Swap or Seller Swap by a Swap Counterparty, and (ii) ending 60 days after either (A) the commencement of the Swap Replacement Period if Base Quantities are above zero MWhs upon the commencement of such period or otherwise (B) any date on which Base Quantities are increased above zero MWhs, provided that:
(i) the Swap Replacement Period will end immediately once it starts if such Buyer Swap or Seller Swap is subject to termination due to the insolvency or bankruptcy of Buyer or Seller;
Attachment Staff Report Item 15D
41 (ii) the Swap Replacement Period will end five Business Days after it starts if such Seller Swap is subject to termination due to Seller’s failure to pay amounts due or post credit support, other than where (A) any such failure to pay or post credit support was caused solely by error or omission of an administrative or operational nature; (B) funds were available to enable Seller to make such payment when due; and (C) such payment is made within two (2) Business Days of Seller’s receipt of written notice of its failure to pay or post credit support;
(iii) if (A) the Unaffected Swap has been terminated on or prior to the last day of the Month in which the Affected Swap is terminated and (B) the Parties continue to make payments under the Swap Custodial Agreement consistent with Section 17.5(f) hereof, the Swap Replacement Period will end on the last day of the Month in which the 120th day following (1) the commencement of the Swap Replacement Period if Base Quantities are above zero MWhs upon the commencement of such period or otherwise (2) any date on which Base Quantities are increased above zero MWhs; and (iv) if Buyer or Seller delivers a [Reset Termination Exercise Notice] or [Optional Termination Notice] (as each term is defined in the Buyer Swap and the Seller Swap), then the Swap Replacement Period shall be the notice period specified under the applicable Buyer Swap or Seller Swap.
(e) If during a Swap Replacement Period Seller:
(i) presents to Buyer a proposed alternate Swap Counterparty, (ii) requests in writing that Buyer enter into a replacement swap with such alternate Swap Counterparty, and
(iii) agrees to pay Buyer’s reasonable expenses in connection therewith, then, to the extent permitted by the Buyer Swap and the Trust Indenture and as requested by Seller, Buyer shall: (A) enter into a master agreement with such alternate Swap Counterparty and (B) either (1) terminate the Buyer Swap when permitted thereby and enter into a replacement transaction under such new master agreement to the same effect as the terminated Buyer Swap, or (2) cause such Buyer Swap to be novated to such replacement Swap Counterparty. (f) If a Seller Swap terminates or is no longer in effect and a [Prepay LLC Payments Period] (as defined in the Seller Swap Custodial Agreement) is in effect, then, during such Prepay LLC Payments Period, Seller in connection with the delivery of Product hereunder shall comply with the terms of the applicable Seller Swap Custodial Agreement and make all payments as and when required under such Seller Swap Custodial Agreement. If a Buyer Swap terminates or is no longer in effect and an [Issuer Payments Period] (as defined in the Buyer Swap Custodial Agreement) is in effect, then, during such Issuer Payments Period, Buyer in connection with the delivery of Product hereunder shall comply with the terms of the applicable Buyer Swap Custodial Agreement and make all payments as and when required under such Buyer Swap Custodial Agreement. The Parties agree that during any Prepay LLC Payments Period and during any Issuer Payments Period, Seller shall act as calculation agent under an applicable Seller Swap Custodial Agreement or an applicable Buyer Swap Custodial Agreement with respect to any Attachment Staff Report Item 15D
42 terminated Seller Swap or Buyer Swap. Seller agrees not to permit any amendment or other modification to a Seller Swap Custodial Agreement that could adversely affect the right of Buyer to receive payments pursuant such Seller Swap Custodial Agreement. Buyer agrees not to permit any amendment or other modification to a Buyer Swap Custodial Agreement that could adversely affect the right of Seller to receive payments pursuant to such Buyer Swap Custodial Agreement.

Section 17.6 Present Assignment and Waiver of Right to Swap Termination Payments.
(a) Assignment of Seller MTM Payment. The Parties hereto acknowledge that (i) the terms of the Buyer Swap do not entitle Buyer to any payments in respect of any termination of the Buyer Swap other than for [Unpaid Amounts] (as therein defined), (ii) the terms of the Seller Swap do not entitle the Swap Counterparty to any payments in respect of any termination of a Seller Swap other than in respect of [Unpaid Amounts] (as defined therein), and (iii) pursuant to the terms of the Buyer Swap, the Swap Counterparty have assigned to Buyer all rights to any payments and rights to receive payments that such Swap Counterparty receives or becomes entitled to receive in the future arising as a result of or otherwise in respect of any early termination of a Seller Swap, excluding only any right for the Swap Counterparty to receive [Unpaid Amounts] (as defined therein) (any such payment under clause (iii), excluding any such Unpaid Amounts, a “Seller Swap MTM Payment”). As additional consideration hereunder, Buyer hereby transfers and assigns to Seller all of Buyer’s right, title, and interest to all payments and rights to receive payments, if any, that Buyer receives or becomes entitled to receive in the future arising as a result of or otherwise in respect of a Seller Swap MTM Payment. Buyer agrees that it will not take any steps to enforce any right to receive any payments that it has assigned to Seller pursuant to this Section 17.6(a).
(b) Assignment of Swap Counterparty MTM Payment. The Parties further acknowledge that the terms of the Seller Swap do not entitle Seller to any payments in respect of any termination of a Seller Swap other than for [Unpaid Amounts] (as defined therein).

Nonetheless, Seller hereby presently transfers and assigns to Buyer all of Seller’s right, title and interest to any payments and rights to receive payments that Seller receives or becomes entitled to receive in the future arising as a result of or otherwise in respect of any early termination of a Seller Swap, excluding only any right for Seller to receive [Unpaid Amounts] thereunder.

Section 17.7 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 Attachment Staff Report Item 15D
43 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 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 PRODUCT 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 ARM’S-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.

Section 17.8 Termination Payment Adjustment Schedule. Seller shall prepare revisions to the then-current Exhibit D-2 (Termination Payment Adjustment Schedule) in connection with each successive Interest Rate Period pursuant to the terms of the Re-Pricing Agreement by delivering a revised Exhibit D-2 to Buyer no later than the last day of the applicable Reset Period, in which case such amendments will be effective as of the first day of the next Interest Rate Period.

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 related 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. No later than delivery of the Prepayment, Buyer will deliver to Seller a copy of the Trust Indenture. The following documents shall be executed and delivered by the Parties contemporaneously with the execution of this Agreement (unless otherwise specified):

Attachment Staff Report Item 15D
44 (a) by Seller no later than the date of issuance of the Bonds, the Funding Agreement;
(b) by Buyer, a certificate of the Secretary or Assistant Secretary of Buyer setting forth (i) the resolutions of its governing body with respect to the authorization of Buyer to execute and deliver this Agreement, the Trust Indenture and the Clean Energy Purchase Contract, (ii) the appropriate individuals who are authorized to sign such agreements, (iii) specimen signatures of such authorized individuals, and (iv) the organization documents of Buyer, certified as being true and complete;
(c) by Seller, evidence reasonably satisfactory to Buyer of (i) Seller’s authority to execute and deliver this Agreement and (ii) the appropriate individuals who are authorized to sign this Agreement; and
(d) by Buyer, on or prior to the Execution Date a valid sales tax exemption certificate and any other required exemption or resale certificate in jurisdictions where sales of Product occur under this Agreement to the extent such a certificate is necessary under applicable law for exemption from any relevant state taxes that may be levied against the Parties in relation to the transactions under, or pursuant, to this Agreement.

Section 18.3 Entirety; Amendments. This Agreement and the Re-Pricing Agreement, including the exhibits and attachments hereto and thereto and the Seller Tariff, constitute the entire agreement between the Parties and supersede all prior discussions and agreements between the Parties with respect to the subject matter hereof. There are no prior or contemporaneous agreements or representations affecting the same subject matter other than those expressed herein (including the Exhibits hereto) and the Re-Pricing Agreement. 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 NEW YORK, WITHOUT REGARD TO ANY CONFLICTS OF LAW PRINCIPLE THAT WOULD DIRECT THE APPLICATION OF ANOTHER JURISDICTION’S LAW; PROVIDED, HOWEVER, THAT THE AUTHORITY OF BUYER TO ENTER INTO

AND PERFORM ITS OBLIGATIONS UNDER THIS AGREEMENT SHALL BE DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.

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 or breaches 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 Attachment Staff Report Item 15D
45 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 18.9 Relationships of Parties; Beneficiaries. 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, except that Seller shall act on behalf of Buyer in remarketing Product pursuant to Exhibit C. 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. Except as provided in Section 18.14 with respect to the Trustee, this Agreement shall not impart any rights enforceable by any third party (other than a permitted successor or assignee bound to this Agreement).

Section 18.10 Immunity. Buyer represents and covenants to and agrees with Seller that it is not entitled to and shall not assert the defense of sovereign immunity with respect to its obligations or any Claims under this Agreement.

Section 18.11 Rates and Indices.
(a) Commodity Reference Prices.
(i) Price Replacement Process for Delayed Publication. If a Commodity Reference Price is not expected to be available for any period (or portion thereof) for any calculation that is required hereunder or under the Buyer Swap or the Seller Swap prior to a relevant calculation being made under any of them, then, upon notice from either Party, the Parties shall promptly endeavor to agree on an alternative source for determination of such Commodity Reference Price for the applicable periods. If such agreement is not reached by the Parties within three Business Days, the Parties shall request quotations for the applicable Commodity Reference Price from four recognized dealers of electric energy (two selected by each Party) for the period that such Commodity Reference Price is expected to be unavailable. If four quotations are provided as requested, the applicable Commodity Reference Price for the applicable days shall be the arithmetic mean of the quotations provided by each recognized dealer after disregarding the quotations having the highest and lowest values. If exactly three quotations are provided, the Attachment Staff Report Item 15D
46 applicable Commodity Reference Price for the applicable days shall be the quotation provided by the relevant dealer that remains after disregarding the quotations having the highest and lowest values. For this purpose, if more than one quotation has the same highest value or lowest value, then one of such quotations shall be disregarded. (ii) Price Replacement Process for Non-Published Index. If a Commodity Reference Price is not available because it has permanently ceased to be published, then the Parties shall promptly endeavor to agree on an alternative source for determination of such Commodity Reference Price. If such agreement is not reached by the Parties within three Business Days, then the replacement Commodity Reference Price shall be selected by Seller, acting reasonably.
(b) Corrections. 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 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.

Neither the faith and credit of Buyer nor the taxing power of the State of California or any political subdivision thereof is pledged to payments pursuant to this Agreement. Buyer 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 [Trust Indenture]) are received for the payment thereof and may be applied therefor pursuant to the terms of the Trust Indenture.

Section 18.14 Rights of Trustee. Pursuant to the terms of the Trust Indenture, Buyer has irrevocably appointed the Trustee as its agent to issue notices (including Remarketing Notices) and as directed under the Trust Indenture, to take any other actions that Buyer is required Attachment Staff Report Item 15D
47 or permitted to take under this Agreement. Seller may rely on notices or other actions taken by Buyer or the Trustee and Seller has the right to exclusively rely on any notices delivered by the Trustee, regardless of any conflicting notices that it may receive from Buyer.

Section 18.15 Operational Services Agreement. Seller acknowledges that Buyer and the Project Participant will enter into that certain Clean Energy Project Operational Services Agreement, dated as of the Bond Closing Date, pursuant to which the Project Participant will have the right to direct Buyer with respect to any directions, consents or waivers by Buyer under this Agreement and the Re-Pricing Agreement.

Section 18.16 Waiver of Defenses. Seller waives all rights to set-off, counterclaim, recoupment and any other defenses that might otherwise be available to Seller with regard to Seller’s obligations pursuant to the terms of this Agreement.

Section 18.17 U.S. Resolution Stay Provisions. Seller and Buyer 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 for the purposes of such incorporation, (i) Seller shall be deemed to be a Regulated Entity, (ii) Buyer shall be deemed to be an Adhering Party, and (iii) this Agreement shall be deemed a Protocol Covered Agreement. In the event of any inconsistences between this Agreement and the ISDA U.S. Stay Protocol, the ISDA U.S. Stay Protocol will prevail.

Section 18.18 Seller Tariff. Seller agrees that if it seeks to amend the Seller Tariff during the Delivery Period, such amendment will not in any way affect this Agreement without the prior written consent of the other Party. Seller further agrees that it will not assert, or defend itself on the basis that the Seller Tariff is inconsistent with this Agreement.

Section 18.19 No Recourse. Buyer shall have no claims against J. Aron or any of its Affiliates (other than Seller), any present or future holder (whether direct or indirect) of any Equity Interests in Seller, or, in the case of any of their respective Affiliates (other than Seller), shareholders, officers, directors, employees, representatives, controlling persons, executives or agents (collectively, the “Non-Recourse Persons”) with respect to the transactions contemplated under this Agreement or under any other document, certificate or instrument executed by Seller in connection herewith, such claims against such Non-Recourse Persons (including as may arise by operation of law) being expressly waived hereby. The limitations on recourse set forth in this Section 18.19 shall survive any Early Termination Payment Date, Product Delivery Termination Date, or other termination or expiration of this Agreement. As used in this Section 18.19, “Equity Interests” means, with respect to any Person, any and all shares, interests, participations or other equivalents (however designated) of capital stock in such Person, or any and all equivalent ownership interests in such Person, including partnership interests, limited liability company interests and membership interests, and any and all warrants, rights or options to purchase any of the foregoing.

Section 18.20 Rate Changes.
(a) Standard of Review. Absent the agreement of the Parties to the proposed change, the standard of review for changes to any rate, charge, classification, term or condition of Attachment Staff Report Item 15D
48 this Agreement, whether proposed by a Party (to the extent that any waiver in Section 18.20(b) below is unenforceable or ineffective as to such Party), a non-party or FERC acting sua sponte, shall solely be the “public interest” application of the “just and reasonable” standard of review set forth in United Gas Pipe Line Co. v. Mobile Gas Service Corp., 350 U.S. 332 (1956) and Federal Power Commission v. Sierra Pacific Power Co., 350 U.S. 348 (1956) and clarified by Morgan Stanley Capital Group Inc. v. Public Util. Dist. No. 1 of Snohomish, 554 U.S. 527 (2008). (b) Waiver. In addition, and notwithstanding Section 18.20(a), to the fullest extent permitted by applicable Law, each Party, for itself and its successors and assigns, hereby expressly and irrevocably waives any rights it can or may have, now or in the future, whether under Section 205 and/or 206 of the Federal Power Act or otherwise, to seek to obtain from FERC by any means, directly or indirectly (through complaint, investigation or otherwise), and each hereby covenants and agrees not at any time to seek to so obtain, an order from FERC changing any section of this Agreement specifying the rate, charge, classification, or other term or condition agreed to by the Parties, it being the express intent of the Parties that, to the fullest extent permitted by applicable Law, neither Party shall unilaterally seek to obtain from FERC any relief changing the rate, charge, classification, or other term or condition of this Agreement, notwithstanding any subsequent changes in applicable Law or market conditions that may occur. In the event it were to be determined that applicable Law precludes the Parties from waiving their rights to seek changes from FERC to their market-based power sales contracts (including entering into covenants not to do so) then this Section 18.20(b) shall not apply, provided that, consistent with Section

18.20(a), neither Party shall seek any such changes except solely under the “public interest” application of the “just and reasonable” standard of review and otherwise as set forth in Section

18.20(a).

Section 18.21 Delivering Entity Tariff. If the Delivering Entity seeks to amend the Delivering Entity Tariff during the Delivery Period, such amendment will not in any way affect this Agreement without the prior written consent of Buyer. Seller shall cause the Delivering Entity to agree that the Delivering Entity will not assert, or defend itself on the basis that the Delivering Entity Tariff is inconsistent with this Agreement or the Electricity Sale and Service Agreement.

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.
[Separate Signature Page(s) Attached]
Attachment Staff Report Item 15D
Signature Page to the Master Power Supply Agreement
ARON ENERGY PREPAY [__] LLC
By: J. Aron & Company LLC, its Manager
By:____________________________________
Name:______________________________
Title:_______________________________
Attachment Staff Report Item 15D
Signature Page to the Master Power Supply Agreement

CALIFORNIA COMMUNITY CHOICE

FINANCING AUTHORITY
By:____________________________________
Name:______________________________
Title:_______________________________
Attachment Staff Report Item 15D
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EXHIBIT A-1
BASE QUANTITIES; BASE DELIVERY POINTS; COMMODITY REFERENCE PRICES
[To be attached.]
Attachment Staff Report Item 15D
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EXHIBIT A-2

EPS ENERGY PERIOD MONTHLY PROJECTED QUANTITY
[To be attached.]
Attachment Staff Report Item 15D
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EXHIBIT A-3

ANNUAL QUANTITY
[To be attached.]
Attachment Staff Report Item 15D
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EXHIBIT B

NOTICES
IF TO SELLER: Aron Energy Prepay [__] LLC
c/o J. Aron & Company LLC
200 West Street
New York, NY 10282
Email: [email protected]
Trading: Timothy Capuano
Telephone: (212) 357-2542
[email protected]
Scheduling: Email: [email protected]
Direct Phone: (212) 855-6188
Fax: (212) 493–9847
Kelly Brooks
Email: ficc-jaron [email protected]
Direct Phone: (212) 855-6188
Fax: (212) 493-9847
Payments/Invoicing: Telephone: (212) 855-0880
[email protected]
General Notices: Andres E. Aguila
Telephone: (212) 855-6008
Fax: (212) 291-2124
[email protected]
IF TO BUYER: California Community Choice Financing Authority 1125 Tamalpais Avenue
San Rafael, CA 94901
Email: [email protected] and [email protected]
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EXHIBIT C

PRODUCT REMARKETING
Section 1. Defined Terms. Capitalized terms used but not otherwise defined in this Exhibit shall have the meanings given to such terms in the Agreement, unless otherwise indicated.

The following terms, when used in this Exhibit C and identified by the capitalization of the first letter thereof, have the respective meanings set forth below, unless the context otherwise requires.

In the event that any of the provisions of the Code or the Treasury Regulations referenced in Section 1 of this Exhibit C (the “Original Code Provisions”) (x) cease to be effective or no longer apply to remarketing and remediation under this Agreement and (y) upon or following such change to the Original Code Provisions, other Code provisions, Treasury Regulations or Laws apply to remarketing and remediation under this Agreement (the “New Code Provisions”), then the references herein to any such Original Code Provisions shall be deemed to refer to the applicable New Code Provisions.
“Code” means the Internal Revenue Code of 1986, as amended. “Daily Remarketing Notice” has the meaning specified in Section 3(c) of this Exhibit C. “Deemed Remarketing Notice” has the meaning specified in Section 3(d) of this Exhibit C. “Expired Non-Private Business Sales Ledger” has the meaning specified in Section 9(a) of this Exhibit C.
“Expired Private Business Sales Ledger” has the meaning specified in Section 9(a) of this Exhibit C.
“Initial Remarketing” has the meaning specified in Section 5 of this Exhibit C. “Ledger Entry” has the meaning specified in Section 7(b) of this Exhibit C. “Ledger Event” has the meaning specified in Section 9(c) of this Exhibit C. “Minimum Remarketing Sales Price” is, for each MWh of Base Product and Hour, an amount determined by the following formula:

MRSP = RRPP – (RRPP x (RRA/CLB))
Where:

MRSP = The Minimum Remarketing Sales Price for such MWh of Base Product and Hour
RRPP = The Remediation Remarketing Purchase Price for one MWh of Base Product and Hour
RRA = The balance of the Remarketing Reserve Fund at such time Attachment Staff Report Item 15D
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CLB = The combined cash balance of the Non-Private Business Sales Ledger and the Private Business Sales Ledger at such time “Monthly Remarketing Notice” has the meaning specified in Section 3(b) of this Exhibit C.
“Municipal Utility” means any Person that (i) is a “governmental person” as defined in Treasury Regulations Section 1.141-1(b), and (ii) owns either or both a Base Product distribution utility or an electric distribution utility (or provides Product or natural gas at wholesale to entities described in clause (i) that own such utilities). Buyer shall from time to time to the extent necessary revise the definition of “Municipal Utility” to conform to the applicable provisions of the Code or Treasury Regulations by delivery of written notice to Seller setting forth the revised definition together with a Tax Opinion.
“Non-Private Business Remarketing Proceeds” means all proceeds received by Buyer under Section 5(c) of this Exhibit C from the Remarketing Entity’s remarketing of Base Product in any Non-Private Business Sale.
“Non-Private Business Sale” means a sale (other than a Qualified Sale) of Base Product to a “governmental person” as defined in Treasury Regulation Section 1.141-1(b) that in each case agrees in writing to not use any part of such Base Product for a Private Business Use. “Non-Private Business Sales Ledger” has the meaning specified in Section 7(a)(i) of this Exhibit C.
“Non-Qualifying Remarketing Limit” means a quantity of Product, in MWhs, equal to 10% of the total quantity of Base Product set forth in Exhibit A-1 to be delivered hereunder, as such Non-Qualifying Remarketing Limit may be increased from time to time upon receipt by Buyer and Seller of a Tax Opinion setting forth a higher Non-Qualifying Remarketing Limit. “Private Business Remarketing Limit” means a quantity of Product, in MWhs, equal to (a) $[_], divided by (b) the Specified Fixed Price, as such Private Business Remarketing Limit may be increased from time to time upon receipt by Buyer and Seller of a Tax Opinion setting forth a higher Private Business Remarketing Limit.
“Private Business Remarketing Proceeds” means all proceeds received by Buyer under Section 5(d) of this Exhibit C in connection with the Remarketing Entity’s remarketing of Base Product in any Private Business Sale.
“Private Business Sale” means any sale of Base Product other than in a Non-Private Business Sale or a Qualified Sale.
“Private Business Sales Ledger” has the meaning specified in Section 7(a)(ii) of this Exhibit C.
“Private Business Use” has the meaning ascribed to such term in Section 141 of the Code.

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“Provisional Payment” has the meaning specified in Section 12(a)(i) of this Exhibit C. “Qualified Sale” means any sale of Product or natural gas:
(x) to a Municipal Utility that agrees in writing (i) to use all of such Product or natural gas for a Qualifying Use that is not a Private Business Use and (ii) not to count any purchase of such Product or natural gas towards any remediation obligations such Municipal Utility may have with respect to proceeds received from the sale of property purchased with tax-exempt financing proceeds other than the Bonds; or
(y) that would not (i) cause interest on the Bonds to be included, or increase the risk of interest on the Bonds being included, in gross income for purposes of federal income taxation under applicable Law at the time of such sale, or (ii) count towards any limit under applicable Law at the time of such sale, beyond which limit interest on the Bonds would become included in gross income for purposes of federal income taxation after the passage of time and lack of any remediation.

Buyer shall from time to time to the extent necessary revise the definition of “Qualified Sale” to conform to the applicable provisions of the Code or Treasury Regulations by delivery of written notice to Seller setting forth the revised definition together with a Tax Opinion. “Qualifying Use” with respect to Product or natural gas has the meaning ascribed to such term in Treasury Regulations Section 1.148-1(e)(2)(iii)(A)(2) or (B)(2), as applicable. “Remarketing Fee” has the meaning specified in Exhibit F. “Remarketing Notice” means either a Daily Remarketing Notice or a Monthly Remarketing Notice, but shall not include a Deemed Remarketing Notice. “Remarketing Reserve Fund” means an account established under the [Trust Indenture] into which Buyer shall deposit the amounts specified in Section 5(e) of this Exhibit C. “Remediation Remarketing” means the remarketing of Product or natural gas in Qualified Sales by either of Buyer or the Remarketing Entity pursuant to Section 8 of this Exhibit C in an effort to reduce to zero any Ledger Entry balances in either the Non-Private Business Sales Ledger or the Private Business Sales Ledger.
“Remediation Remarketing Purchase Price” has the meaning specified in Section 8(a)(ii)(B) of this Exhibit C.
“Tax Opinion” means an Opinion of [Bond Counsel] or [Special Tax Counsel] (as defined in the [Trust Indenture]) to the effect that an action proposed to be taken or an event will not, in and of itself, cause interest on the applicable Bonds to be included in gross income for purposes of federal income taxation.
“Treasury Regulations” means the U.S. Treasury Regulations under the Code.

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Section 2. Buyer’s Right and Obligation to Request Remarketing. Buyer may, and, if required to do so under the Trust Indenture or Article VII of the Agreement shall, and the Project Participant (subject to the conditions set forth in the Clean Energy Purchase Contract) may, request the Remarketing Entity to remarket, pursuant to this Exhibit C, all or a specified part of the applicable Quantities for any Delivery Point.

Section 3. Remarketing Notice.
(a) Generally. To request remarketing under this Exhibit C, Buyer or the Project Participant must issue a Remarketing Notice substantially in the form attached as Attachment 3 of Exhibit G to the Agreement, which Remarketing Notice must state the portion of the applicable Quantity to be remarketed in each Hour in each Day from each relevant Delivery Point.
(b) Monthly Remarketing Notice. Buyer or the Project Participant may designate a Remarketing Notice as a “Monthly Remarketing Notice” if the Remarketing Notice is delivered to the Remarketing Entity not later than three Business Days prior to the start of the first Month in which it applies, and applies to a period of one Month or more; provided furthermore that, in the event Seller is obligated to remarket Base Quantities under Section 3.2 of the Agreement, Buyer shall be deemed to have delivered a Monthly Remarketing Notice with respect thereto.
(c) Daily Remarketing Notice. Buyer or the Project Participant may designate a Remarketing Notice as a “Daily Remarketing Notice” if the Remarketing Notice is delivered to the Remarketing Entity not later than three Business Days prior to the start of the first Day in which it applies.
(d) Deemed Remarketing Notice. Any other notice to remarket Base Product given by Buyer will be a “Deemed Remarketing Notice.”
Section 4. Remarketing Entity’s Remarketing Obligations Generally. (a) Sales for Buyer’s Account. All Base Product remarketed by the Remarketing Entity pursuant to this Exhibit C shall be for the benefit of Buyer, meaning all remarketed Base Product shall first be sold by the Remarketing Entity to Buyer and then resold by or for the account of Buyer pursuant to the terms and provisions of this Exhibit C. (b) Limitation on Seller Duties. The Remarketing Entity may act directly as principal to the remarketing buyer, or may cause a supplier to the Remarketing Entity to act directly as principal to the remarketing buyer. Neither the Remarketing Entity nor any Person acting on the Remarketing Entity’s behalf shall owe any fiduciary duties to Buyer with respect to the remarketing of any Base Product. Buyer acknowledges and agrees that the Remarketing Entity or a Person acting on the Remarketing Entity’s behalf in remarketing Base Product may have other supplies of Base Product available to sell to potential remarketing buyers, and Base Product designated for remarketing shall not be entitled to any preference over any such other supplies of Base Product.

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(c) Monthly Records. The Remarketing Entity shall prepare, maintain and provide monthly to Buyer and Seller accurate and complete records showing (i) the identity of each purchaser in a Qualified Sale, a Non-Private Business Sale, or a Private Business Sale undertaken by the Remarketing Entity on Buyer’s behalf, (ii) the aggregate amount of Base Product remarketed under this Agreement in Qualified Sales, (iii) the aggregate amount of Base Product remarketed under this Agreement in Non-Private Business Sales, and (iv) the aggregate amount of Base Product remarketed under this Agreement in Private Business Sales.

Notwithstanding the foregoing or anything to the contrary herein, in the event that either Party (x) reasonably determines that interest on the Bonds is not excluded from gross income for federal income tax purposes due to a change in Law, (y) receives an opinion of counsel to such effect (provided that such opinion of counsel shall be rendered by counsel of nationally recognized standing in matters pertaining to the tax exempt status of interest on obligations issued by states and their political subdivisions, duly admitted to the practice of law before the highest court of any state of the United States) and (z) notifies the other Party of such determination (which notice shall include a copy of the opinion of counsel referenced in clause (y)), then (I) the terms of this Exhibit C regarding the remediation obligations of the Parties shall cease to apply and shall be of no further force and effect, and (II) Seller shall no longer maintain the records described in the immediately preceding sentence and shall not record Ledger Entries or otherwise maintain the ledgers described in Section 7(a) and Section 9(a) of this Exhibit C.
(d) Remission of Sales Proceeds. Any amounts due to Buyer for Base Product remarketed by the Remarketing Entity or purchased by the Remarketing Entity under this Exhibit C shall be remitted to Buyer pursuant to Section 14.2 of the Agreement in the Month following the Month in which such Base Product is remarketed or purchased, as applicable.

Section 5. Initial Remarketing. The following provisions shall apply to the initial remarketing of any Base Product to be remarketed by the Remarketing Entity pursuant to a Remarketing Notice (an “Initial Remarketing”):
(a) Remarketing Entity’s Remarketing Duties. The Remarketing Entity shall use Commercially Reasonable Efforts to remarket or cause to be remarketed all Base Product specified for Initial Remarketing. In exercising such Commercially Reasonable Efforts, the Remarketing Entity shall first attempt to remarket or cause to be remarketed all Base Product specified in a Remarketing Notice in Qualified Sales and then, if the Remarketing Entity is unable to remarket all of such Base Product for such purposes, in Non-Private Business Sales. If the Remarketing Entity is unable to remarket all or any portion of the Base Product designated in a Remarketing Notice in Qualified Sales and Non-Private Business Sales, then the Remarketing Entity shall purchase such Base Product for its own account at the prices set forth in Section 5(d) of this Exhibit C as if such Base Product had been remarketed to it. (b) Floor Price. The Remarketing Entity shall not be required to remarket any Base Product in an Initial Remarketing for any Hour at a net price to the Remarketing Entity (after deducting all transportation costs and all other costs) that is anticipated to be less than (i) the Day-Ahead Market Price applicable to such Base Product and Hour in the case of an Initial Remarketing pursuant to a Monthly Remarketing Notice, or (ii) the Real-Time Market Price applicable to such Base Product and Hour in the case of an Initial Remarketing pursuant to a Daily Remarketing Notice.

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(c) Proceeds from Qualified Sales and Non-Private Business Sales. (i) For any Base Product specified in a Monthly Remarketing Notice that the Remarketing Entity remarkets in a Qualified Sale or Non-Private Business Sale, Seller shall pay to Buyer the actual proceeds of such remarketing received by the Remarketing Entity, less the Remarketing Fee per MWh sold; provided that the aggregate amount paid by Seller under this clause (i) for any Month shall not be less than the aggregate quantity so remarketed during such Month multiplied by the Net Participant Price.
(ii) For any Base Product specified in a Daily Remarketing Notice that the Remarketing Entity remarkets in a Qualified Sale or Non-Private Business Sale, Seller shall pay to Buyer the actual proceeds of such remarketing received by the Remarketing Entity, less the Remarketing Fee per MWh sold, provided that the aggregate amount paid by Seller under this clause (ii) for any quantity of Base Product remarketed shall not be less than the result of (x) the quantity so remarketed multiplied by (y) the product of the Real-Time Market Price(s) for the relevant Hour(s) multiplied by the applicable [Monthly Discount Percentage] (as defined in the [Clean Energy Purchase Contract]) with respect to any Base Product specified in a Daily Remarketing Notice. (iii) In the event the payment due date under a Qualified Sale or Non-Private Business Sale has not yet occurred prior to the date upon which payment is due under this Agreement for the applicable Month, the Parties shall nonetheless issue statements as if the full amount from such Qualified Sale or Non-Private Business Sale had been paid and, if such full payment is not received prior to the next monthly due date under this Agreement, the Parties shall issue the appropriate statements to reflect the actual proceeds received and true-up any difference.
(d) Proceeds from Private Business Sales.
(i) For any Base Product specified for any Hour of any Day in a Monthly Remarketing Notice that is not remarketed in a Qualified Sale or Non-Private Business Sale, Seller shall pay to Buyer the positive result determined by the following formula with respect to each Delivery Point to which such Monthly Remarketing Notice applied, provided that the aggregate amount paid by Seller under this clause (i) for any Month shall not be less than the aggregate quantity so remarketed during such Month multiplied by the Net Participant Price:

P = Q x (DAMP – RF)
Where:

P = The amount payable by Seller under this Section 5(d)(i) for such Day and Delivery Point
Q = The quantity of such Base Product for such Day purchased by Seller with respect to such Delivery Point
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DAMP = The Day-Ahead Market Price for such Delivery Point and Hour RF = The Remarketing Fee
(ii) For any Base Product specified for any Hour or portion thereof in a Daily Remarketing Notice that is not remarketed in a Qualified Sale or Non-Private Business Sale, Seller shall pay to Buyer the positive result determined by the following formula with respect to each Delivery Point to which such Daily Remarketing Notice applied:

P = Q x (RTMP – RF)
Where:

P = The amount payable by Seller under this Section 5(d)(ii) for such Hour or portion and Delivery Point
Q = The quantity of such Base Product for such Hour or portion remarketed with respect to such Delivery Point
RTMP = The Real-Time Market Price for such Delivery Point and Hour or portion
RF = The Remarketing Fee
(e) Deposits to Remarketing Reserve Fund. Any proceeds received by Buyer under this Section 5 for Base Product remarketed in sales other than Qualified Sales that exceed the amount Buyer would have received for the same quantity of Base Product at the Net Participant Price shall be deposited in the Remarketing Reserve Fund.

Section 6. Reserved.

Section 7. Tracking Remarketing Proceeds.
(a) Ledgers. The Remarketing Entity shall maintain four separate ledgers related to remarketing proceeds as described below:
(i) One ledger (the “Non-Private Business Sales Ledger”), to which Seller shall credit, (A) as dollar credits, the Non-Private Business Remarketing Proceeds, and (B) as MWh credits, the MWhs of Base Product purchased or remarketed to produce such Non-Private Business Remarketing Proceeds.
(ii) Another ledger (the “Private Business Sales Ledger”), to which Seller shall credit, (A) as dollar credits, Private Business Remarketing Proceeds, and (B) as MWh credits, the MWhs of Base Product purchased or remarketed to produce such Private Business Remarketing Proceeds.

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(iii) The other two ledgers shall be maintained, credited, and debited as described in Section 9(a) of this Exhibit C.
(b) Date of Ledger Entries. The credits to be recorded in the ledgers described in Section 7(a)(i) and Section 7(a)(ii) of this Exhibit C (collectively, the “Ledger Entries”) shall be dated as of the first Day of the Month prior to the Month in which Buyer or the Project Participant receives the proceeds corresponding to such Ledger Entries. (c) Aggregation of Ledgers. The four ledgers described in Sections 7(a) and 9(a) of this Exhibit C and all debits and credits to such ledgers shall be kept on an aggregate basis for purposes of this Exhibit C.
(d) Disqualified Sales. Buyer shall provide to the Remarketing Entity all reports provided by the Project Participant pursuant to [Section 7.5 of the Clean Energy Purchase Contract]. To the extent set forth in [Section 7.6(a) of the Clean Energy Purchase Contract], the Remarketing Entity will add “Disqualified Sale Proceeds” to the appropriate ledgers described above. Buyer agrees to cause any payment made by the Project Participant pursuant to [Section

7.6(c) of a Clean Energy Purchase Contract] to be deposited into the [Debt Service Account] (as defined in the [Trust Indenture]).
(e) Remarketing of and Remediation with Storage Products. For any remarketing proceeds relating to Assigned Product measured in kW-month, the Parties acknowledge and agree that such proceeds shall be recorded in the applicable ledgers on a MWh basis calculated as the result of (i) the total dollar proceeds of any such remarketing divided by (ii) (x) $[_] for Assigned Product during the Initial Assignment Periods and (y) $[_] for Assigned Product outside of the Initial Assignment Periods. Any Provisional Payment Fee relating thereto shall be calculated on a per MWh basis consistent with the result of the conversion to MWhs pursuant to the preceding sentence.

Section 8. Remediation Remarketing.
(a) Remarketing. At any time that the Ledger Entry balance of either the Non-Private Business Sales Ledger or the Private Business Sales Ledger is greater than zero:
(i) Buyer shall exercise or shall cause the Project Participant to exercise Commercially Reasonable Efforts to utilize the proceeds represented by the dollar balances of such Ledger Entries to purchase Product for resale in Qualified Sales and shall promptly notify the Remarketing Entity following such purchase and sale. Additionally, Seller and Buyer acknowledge and agree that any purchases of Monthly Excess Quantities by the Project Participant shall be applied to the reduction of any such Ledger Entries, provided that Monthly Excess Quantities applied to reduce Ledger Entries shall not credit toward the satisfaction of the Annual Quantity for the Contract Year in which such Monthly Excess Quantities are delivered.
(ii) The Remarketing Entity shall exercise Commercially Reasonable Efforts to locate opportunities for Buyer to purchase Product to sell in Qualified Sales to remediate the proceeds represented by the dollar balances of the Ledger Entries. In this regard, if the Remarketing Entity locates a Remediation Remarketing opportunity, then:

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(A) the Remarketing Entity shall notify Buyer of such
opportunity;
(B) Buyer shall, upon receipt of such notice, purchase Product from the Remarketing Entity at a price determined by the Remarketing Entity in a Commercially Reasonable manner based upon applicable market prices at the location where the remarketing opportunity sale will occur (the “Remediation Remarketing Purchase Price”);
(C) the Remarketing Entity shall remarket such Product on Buyer’s behalf in a Qualified Sale;
(D) Seller shall remit to Buyer the proceeds collected by the Remarketing Entity from such Qualified Sale, but in no event shall Seller remit less than the Minimum Remarketing Sales Price for the remarketing transaction; provided, however, that to the extent Seller does not receive the Remediation Remarketing Purchase Price from Buyer prior to the Remediation Remarketing described herein, Seller shall credit the proceeds collected by the Remarketing Entity from such remarketing sale against the Remediation Remarketing Purchase Price owed to Seller, and Seller shall be reimbursed from the Remarketing Reserve Fund to the extent necessary to make the Remarketing Entity whole for such Qualified Sale; and
(E) the Remarketing Entity shall issue to Buyer a confirmation notice (including the dollar price and MWhs) of each purchase of Product by or on behalf of Buyer, and each sale of Product on Buyer’s behalf, under this Section 8(a)(ii), and amounts due from or to Buyer shall be separately stated on the Billing Statement for the Month in which such remarketing transactions occur.

For the avoidance of doubt, the Remarketing Entity shall not sell, nor shall it be required to sell, Product to Buyer for a Remediation Remarketing if such Product is to be remarketed by the Remarketing Entity on behalf of Buyer for less than the Minimum Remarketing Sales Price. (b) Indemnification of Buyer. Unless the terms of a Remediation Remarketing undertaken by the Remarketing Entity on Buyer’s behalf are specifically assumed by Buyer, Seller shall indemnify Buyer for any costs or liabilities associated with such Remediation Remarketing (other than costs related to the price at which such Product is sold and the risk of collecting the sale proceeds from the remarketing buyer), including, without limitation, any cover or replacement costs; termination payments; fees, penalties, costs or charges (in cash or in kind) assessed by any Transmission Provider for failure to satisfy its balance or nomination requirements; Claims for breach of warranty; taxes, fees, levies, penalties, licenses or charges imposed by any Government Agency; and Claims from personal injury or property damages. (c) Electric Energy Remediation Debits. The total purchase price of any Product purchased by Buyer or the Remarketing Entity pursuant to Section 8(a) of this Exhibit C will be entered by the Remarketing Entity as a dollar debit on (i) first, the Private Business Sales Ledger, if and to the extent such ledger has a positive balance and such Product is remarketed in a Attachment Staff Report Item 15D
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Qualified Sale and (ii) second, on the Non-Private Business Sales Ledger, if and to the extent such ledger has a positive balance, the Private Business Sales Ledger has a zero balance, and such Product is remarketed in a Qualified Sale, with such debit in the case of (i) or (ii) dated as of the last day of the Month in which such Product was purchased. Each dollar debit shall offset and reverse an equal amount of the dollar credits to such ledger (that have not previously been transferred to the Expired Non-Private Business Sales Ledger or the Expired Private Business Sales Ledger) in the order in which they were made (beginning with the oldest credit not previously offset and reversed by any prior debit). Whenever a debit is made to the dollar balance of the Ledger Entries of either such ledger, the Remarketing Entity shall also debit the Product balance of the Ledger Entries of such ledger based on (i) such dollar debit divided by (ii) an average Product price calculated from the net Ledger Entry then present on the relevant ledger being debited. For the avoidance of doubt, neither the Non-Private Business Sales Ledger nor the Private Business Sales Ledger shall ever have a negative balance, and the same purchase transaction shall not result in a debit to more than one ledger except to the extent that a debit for the transaction causes one ledger to have a zero balance and the remaining portion of the permitted debit is made to the other ledger. To the extent any Product sold in a remediation sale is measured in kW-mo, such sales shall be converted to MWh for the purpose of entering credits to the applicable ledger consistent with the formula set forth in Section 7(e) above. (d) Natural Gas Remediation. In addition to the ability of the Remarketing Entity or Buyer to engage in Remediation Remarketing to reduce the balances of any Ledger Entries through Qualified Sales of Product, the proceeds represented by the dollar balances of such Ledger Entries may also be remediated through the purchase of natural gas that will be remarketed in Qualified Sales. If the Remarketing Entity locates an opportunity for Buyer to purchase natural gas for a Remediation Remarketing, the provisions of Section 8(a)(ii) of this Exhibit C shall apply to such opportunity with the following modifications: (i) every occurrence of the term “Product” shall be replaced with “natural gas” and (ii) the definition of Minimum Remarketing Sales Price shall be revised to replace every occurrence of “MWh of Product” with “MMBtu of natural gas.” For the purposes of entering MWh debits to the Ledger Entries in accordance with Section 8(c) of this Exhibit C for any Remediation Remarketing of natural gas, a quantity of MMBtus will be debited based on (i) the total proceeds paid for such natural gas divided by (ii) an average Product price calculated from the net Ledger Entry then present on the relevant ledger being debited. (e) Other Remediation Debits. In the event that (i) the Project Participant remediates the proceeds represented by the dollar balances of the Ledger Entries pursuant to [Section 7.5 of the Clean Energy Purchase Contract] or (ii) Bonds are redeemed pursuant to the provisions of [Section 7.6(c) of the Clean Energy Purchase Contract] and [Section 4.01(b) of the Trust Indenture], the corresponding Ledger Entries then present on any ledger shall be debited.

Section 9. Ledger Event.
(a) Expired Entry Ledgers. In addition to the Non-Private Business Sales Ledger and the Private Business Sales Ledger described in Sections 7(a)(i) and 7(a)(ii) of this Exhibit C, above, Seller shall also maintain an “Expired Non-Private Business Sales Ledger” and an “Expired Private Business Sales Ledger”. Whenever a credit to the dollar balance of the Ledger Entries of the Non-Private Business Sales Ledger has not been reversed in full within two years of the date of such credit by an offsetting dollar debit in accordance with such Section 8(c) or Section Attachment Staff Report Item 15D
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8(d) of this Exhibit C, then Seller shall (i) debit the remaining portion of such dollar credit and the Product balance of the Ledger Entries in the manner described in the penultimate sentence of Section 8(c) and (ii) record such debits as credits to the Expired Non-Private Business Sales Ledger. Similarly, whenever a credit to the dollar balance of the Ledger Entries of the Private Business Sales Ledger has not been reversed in full within two years of the date of such credit by an offsetting dollar debit in accordance with Section 8(c) or Section 8(d) of this Exhibit C, then Seller shall (i) debit the remaining portion of such dollar credit and the Product balance of the Ledger Entries in the manner described in the penultimate sentence of such Section 8(c) and (ii) record such debits as credits to the Expired Private Business Sales Ledger. (b) Reports to Buyer.
(i) No later than the tenth day of each Month, the Remarketing Entity shall provide to Buyer copies of the Non-Private Business Sales Ledger, the Private Business Sales Ledger, the Expired Non-Private Business Sales Ledger and the Expired Private Business Sales Ledger showing all credits and debits to each such ledger since the Execution Date, in each case if a credit has been recorded in such ledger since the Execution Date.
(ii) Additionally, if at any time (i) the credits to the dollar balance of the Ledger Entries of a Non-Private Business Sales Ledger or a Private Business Sales Ledger have not been reversed within twenty-two (22) Months of being recorded and (ii) the continued failure to reverse such credits within two years of being recorded would result in a Ledger Event (under Section 9(c) below), then Seller no later than the tenth (10th) day of the 22nd Month following the entry of such credits shall provide notice to Buyer of the potential for the occurrence of a Ledger Event and request that Buyer consult with Special Tax Counsel regarding (A) a partial redemption of the Bonds as a remedial action with respect to such potential Ledger Event and (B) the possibility of delivery of a Tax Opinion if such a Ledger Event occurs.
(c) Ledger Event. A “Ledger Event” shall occur if, at any time, either (i) (A) the sum of all MWh credits on an Expired Non-Private Business Sales Ledger and the corresponding Expired Private Business Sales Ledger exceeds (B) the Non-Qualifying Remarketing Limit, or (ii) (A) the sum of all MWh credits on an Expired Private Business Sales Ledger exceeds (B) the Private Business Remarketing Limit, unless Buyer has obtained a Tax Opinion with respect to either (I) such event or (II) any remedial action that may have been taken with respect to the Bonds.
(d) Sole Remedies. The occurrence of a Ledger Event and any remedies associated therewith in Article XVII of the Agreement shall be Buyer’s sole and exclusive remedies with respect to any inability by the Remarketing Entity to purchase and remarket Product for Buyer pursuant to, or any breach by the Remarketing Entity of its obligations under, this Exhibit C.

Section 10. Third Party Remarketing Agent. To the extent that the net Ledger Entry balance of either the Non-Private Business Sales Ledger or the Private Business Sales Ledger is greater than zero (0) for a period of twelve (12) Months or longer, Seller may appoint a third party Attachment Staff Report Item 15D
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remarketing agent to remediate the outstanding Ledger Entries instead of the Remarketing Entity; provided that such third party remarketing agent must agree to (a) remediate such Ledger Entries consistent with the terms of this Exhibit C and (b) exercise Commercially Reasonable Efforts to enter into remarketing sales to the extent that Buyer, the Remarketing Entity or J. Aron locate opportunities for remarketing sales after such third party remarketing agent’s appointment.

Section 11. Buyer Right to Request to Purchase Remarketed Product. Notwithstanding any other provision of this Exhibit C, Buyer may request in a Remarketing Notice delivered to Seller that Buyer be the remarketing buyer of the quantities of Product described in such Remarketing Notice, in which case Seller will sell such remarketed Product to Buyer at a price, at Delivery Point(s) and on date(s) to be mutually agreed (but the price shall in no event be less than the Net Participant Price) by the Parties, provided that Seller shall be obligated to remarket such Product to Buyer only if all of the following conditions are satisfied:
(i) Buyer is not in default under any Transaction Document; (ii) Buyer has certified to Seller in the Remarketing Notice that the condition in clause (a) above is true;
(iii) Buyer has provided such adequate assurances of Buyer’s performance, if any, as may have been reasonably requested by Seller; (iv) there is a master agreement in effect between Buyer and Seller that will govern the remarketing transaction between Buyer and Seller; and (v) Buyer covenants to resell the Product only in Qualified Sales.

Section 12. Provisional Payments and Remarketing of Assigned Product. (a) Provisional Payments for and Remarketing of Assigned Product.

Notwithstanding anything to the contrary herein, the following terms shall apply to under deliveries of Assigned Product.
(i) To the extent that the quantity of Assigned Product delivered under an Assigned PPA in any Month is less than the Monthly Projected Quantity for such Month, then Seller shall pay Buyer for any such Month the product of (I) the Monthly Projected Quantity for the relevant Assigned PPA(s), minus the quantity of Assigned Product actually delivered under such Assigned PPA(s), multiplied by (II) the result of the Day-Ahead Average Price minus any applicable Provisional Payment Fee (any such payment, a “Provisional Payment”); provided that the Parties acknowledge and agree that any such obligation shall be satisfied consistent with the terms of Section 14.1(b)(ii) regarding resettlement payments under this Agreement, the Clean Energy Purchase Agreement, the Electricity Sale and Service Agreement, and the PPA Custodial Agreement. (ii) To the extent that a quantity of Assigned Product equal to or greater than the Annual Quantity are delivered for any Contract Year, any Provisional Payments made during such Contract Year shall not result in Ledger Entries under this Exhibit C.

Attachment Staff Report Item 15D
C-13
(iii) To the extent that less than the Annual Quantity of Assigned Product is delivered for any Contract Year, then (A) Buyer shall be deemed to have requested for Seller to remarket a quantity of Assigned Product equal to the Annual Quantity minus the quantity of Assigned Product actually delivered during such Contract Year (such quantities, the “Remarketed Quantities”), provided that (x) the Remarketed Quantities shall be reduced by any Assigned Product not delivered due to Force Majeure and (y) any Provisional Payment attributable to Assigned Product not delivered due to Force Majeure shall be excluded from the calculations described below, and (B) Seller shall be deemed to have purchased such Remarketed Quantities for its own account at a price equal to the Average Provisional Price (as defined in Section 12(a)(iv) below). Any purchase by Seller of the Remarketed Quantities for its own account pursuant to this Section 12(a) shall constitute a Private Business Sale and shall be reflected on the Private Business Sales Ledger effective as of the first day of the Ledger Month (as defined below). Buyer shall notify Seller if and to the extent the proceeds from any such Private Business Sales are applied to amounts owed by the Project Participant pursuant to [Section 7.5 of the Clean Energy Purchase Contract], and, to the extent so applied, such proceeds shall remediate such Private Business Sales and be entered as debits on the Private Business Sales Ledger. (iv) The following terms have the meaning specified below for the purpose of this Section 12(a).
“Average Provisional Price” means the sum of all Provisional Payment Allocation Amounts for such Contract Year.
“Ledger Month” means, for any Contract Year, the Month immediately following the last Month for which the Pro-Rated Monthly Quantity was fully delivered for such Contract Year. For example, if (x) a Contract Year is from January 1 to December 31, (y) the Annual Quantity is 120 MWhs and (z) 110 MWhs are delivered in a given Contract Year, then the resulting Ledger Entries would be entered on December 1 for such Contract Year.

For another example, if (x) a Contract Year is from January 1 to December 31, (y) the Annual Quantity is 120 MWhs and (z) 85 MWhs are delivered in a given Contract Year, then the resulting Ledger Entries would be entered on September 1 for such Contract Year.
“Pro-Rated Monthly Quantity” means, for each Contract Year, the quantity attributable to each Month of such Contract Year if the Annual Quantity is divided into twelfths. For example, if the Annual Quantity is 120 MWhs, the Pro-Rated Monthly Quantity for each Month in a Contract Year is 10 MWhs – and, in such case, if (x) 110 MWhs are delivered in a given Contract Year, the Pro-Rated Monthly Quantity would be fully delivered for 11 of the 12 Months in such Contract Year; and (y) if 85 MWhs are delivered in a given Contract Year, the Pro-Rate Monthly Quantity would be fully delivered for 8 of the 12 Months in such Contract Year. “Provisional Payment Allocation Amount” means, for each Provisional Payment in a Contract Year, an amount (in $/MWh) determined by Attachment Staff Report Item 15D
C-14
multiplying the Weight for such Provisional Payment by the price used to calculate such Provisional Payment.
“Provisional Payment Fee” means $[_]/MWh, which fee shall apply with respect to Provisional Payments under this Section 12(a) in the following circumstances:
(a) to the extent that both (i) less than [_]% of the Monthly Projected Quantity in aggregate under an Assigned PPA are delivered in a Contract Year and (ii) less than [_]% of the Monthly Projected Quantity under the same Assigned PPA are delivered in the four consecutive Months preceding the end of such Contract Year (provided that, for the purpose of clauses (i) and (ii), any Monthly Projected Quantity not delivered due to Force Majeure shall be disregarded), the Provisional Payment Fee shall be applicable to Provisional Payments for Assigned Product under such Assigned PPA commencing with Seller’s Provisional Payment for the last Month of such Contract Year and such Provisional Payment Fee shall continue to apply with respect to such Assigned PPA until such Assigned PPA has delivered [_]% or more of the Monthly Projected Quantity for such Assigned PPA for three consecutive Months; or (b) to the extent that none of the Monthly Projected Quantity are actually delivered under an Assigned PPA for six consecutive Months due to Force Majeure, then (i) an “Assigned PPA FM Remarketing Event” shall be in effect until such Assigned PPA has delivered [_]% or more of the Monthly Projected Quantity for such Assigned PPA for three consecutive Months and (ii) the Provisional Payment Fee shall be applicable to Provisional Payments for Assigned Product under such Assigned PPA commencing with Seller’s Provisional Payment for the sixth consecutive Month of non-deliveries until such Assigned PPA FM Remarketing Event is no longer in effect;
provided that, for the purpose of determining under clauses (i) and (ii) above whether [_]% of the aggregate Monthly Projected Quantity are delivered in any Month under an Assigned PPA that includes separate Monthly Projected Quantity for Energy and storage Products, the Monthly Projected Quantity for storage Products shall be converted to MWhs consistent with the formula set forth in Section 7(e) of this Exhibit C in order to aggregate such Monthly Projected Quantity for storage Products with the Monthly Projected Quantity for Energy under such Assigned PPA.
“Weight” means an amount (in $/MWh) determined for each Provisional Payment in a Contract Year by dividing the amount of each such Provisional Payment by the sum of all Provisional Payments for such Contract Year.

Attachment Staff Report Item 15D
D-1
EXHIBIT D-1

TERMINATION PAYMENT SCHEDULE
Month of Early
Termination Payment
Date
Early Termination Payment
Date (If Not a Business Day,
Preceding Business Day)
Termination Payment
($)
[To be attached.]
Attachment Staff Report Item 15D
D-2
EXHIBIT D-2

TERMINATION PAYMENT ADJUSTMENT SCHEDULE
[To come for subsequent periods.]
Attachment Staff Report Item 15D
D-3
EXHIBIT D-3

POST-TERMINATION PAYMENT SCHEDULE
[To be attached.]
Attachment Staff Report Item 15D
E-1

EXHIBIT E

RECEIVABLES PURCHASE EXHIBIT
[To be attached.]
Attachment Staff Report Item 15D
F-1

EXHIBIT F

PRICING AND OTHER TERMS
Prepayment: $[_]
Prepayment Outside Date: [_], 20[_]
Delivery Period: shall commence on [_], 20[_] and shall continue in effect until the end of the day on [_], 20[_] or earlier upon the Product Delivery Termination Date.

Remarketing Fee: $[_]/MWh, provided that the Remarketing Fee shall be zero with respect to any Product remarketed to Buyer in accordance with Section 11 of Exhibit C.

Discount Rate Spread: [_] basis points per annum
Specified Fixed Price: $[_]/MWh
Administrative Fee: $[_]/MWh
Attachment Staff Report Item 15D
G-1

EXHIBIT G

COMMUNICATIONS PROTOCOL FOR BASE QUANTITIES
This Exhibit G (“Communications Protocol”) addresses the Scheduling of Base Quantities to be delivered and received at the Base Delivery Point. It is intended to be attached to both the Master Power Supply Agreement and the Clean Energy Purchase Contract, each as defined below.

1. ADDITIONAL DEFINED TERMS
In addition to the terms defined in Article I of this Agreement, the following terms used in this Communications Protocol shall have the following meanings:
“Agreement” means (i) when this Communications Protocol is attached to the Master Power Supply Agreement, the Master Power Supply Agreement and (ii) when this Communications Protocol is attached to the Clean Energy Purchase Contract, the Clean Energy Purchase Contract.
“Clean Energy Purchase Contract” means that certain Clean Energy Purchase Contract dated as of [_], 202[_] by and between Issuer and Project Participant. “Delivery Scheduling Entity” means the Delivering Entity or a Person designated by the Delivering Entity, as set forth in Attachment 4 hereto or in a subsequent written notice to Issuer and the Project Participant.
“Issuer” means 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).
“Master Power Supply Agreement” means that certain Master Power Supply Agreement dated as of [_], 20[_] by and between Prepay LLC and Issuer that is specified as relating to the Clean Energy Purchase Contract with Project Participant. “Operational Nomination” has the meaning specified in Section 4.1.1. “Prepay LLC” means Aron Energy Prepay [_] LLC, a Delaware limited liability company. “Project Participant” means Ava Community Energy Authority, a joint powers authority and a community choice aggregator organized under the Laws of the State of California. “Receipt Scheduling Entity” for any Delivery Point means the Project Participant, unless the Clean Energy Purchase Contract has been suspended or terminated, in which case the Receipt Scheduling Entity will be Issuer or a Person designated by Issuer for such Delivery Point in accordance with this Communications Protocol. “Relevant Contract” means the Master Power Supply Agreement and the Clean Energy Purchase Contract.

Attachment Staff Report Item 15D
G-2
“Relevant Party” means Issuer, Prepay LLC or the Project Participant. “Relevant Third Party” means any Person that is (i) a Transmission Provider that will or is intended to transport Product to be delivered or received under the Agreement, (ii) an independent system operator or control area that coordinates the Scheduling of Product at the Base Delivery Point, (iii) Scheduling receipt of Product by Issuer or for the account of Issuer to the extent such Product has been delivered to Issuer or for the account of Issuer under the Master Power Supply Agreement, and (iv) delivering Product to Issuer or for the account of Issuer to the extent such Product is intended to be re-delivered ultimately to the Project Participant or for the account of the Project Participant under the Clean Energy Purchase Contract.
“Scheduling Entities” means the Receipt Scheduling Entity and the Delivery Scheduling Entity.

2. AGREEMENTS OF RELEVANT PARTIES
Each Relevant Party that is a party to Relevant Contract to which this Communications Protocol is attached acknowledges that this Communications Protocol sets forth certain obligations that may be delegated to other Relevant Parties that are not parties to such Relevant Contracts. In connection therewith:

2.1 Reliance on Scheduling Entity. Each Relevant Party shall be entitled to rely exclusively on any communications or directions given by a Delivery Scheduling Entity or Receipt Scheduling Entity, in each case to the extent such communications are permitted hereunder.

2.2 Performance of Communications Protocol. Each Relevant Party to a Relevant Contract shall cause its counterparty to each other Relevant Contract to comply with the provisions of this Communications Protocol as the provisions apply to the such counterparty to the extent required to perform the obligations of the Relevant Party under the Relevant Contract.

2.3 Third Party Beneficiaries. To the extent this Communications Protocol purports to give any Relevant Party (a “Beneficiary”) rights vis-à-vis any other Relevant Party (a “Burdened Party”) with whom such Beneficiary does not have privity under a Relevant Contract, such Beneficiary shall be deemed to be a third party beneficiary of each Relevant Contract to which the Burdened Party is a party to the extent necessary or convenient to enforce the obligations of the Burdened Party under this Communications Protocol.

2.4 Amendment of Relevant Contracts. No Relevant Party shall amend, waive or otherwise modify any provision of any Relevant Contract to which it is a party without the consent of each other Relevant Party whose rights or obligations would be materially and adversely affected by such amendment, waiver or modification as it relates to this Communications Protocol.

Attachment Staff Report Item 15D
G-3

2.5 Amendment of Communications Protocol. No Relevant Party shall amend any provision of this Communications Protocol in a Relevant Contract without the consent of each other Relevant Party.

2.6 Waiver of Communications Protocol. No Relevant Party shall waive any provision of this Communications Protocol in a Relevant Contract without the consent of each other Relevant Party whose rights or obligations would be materially and adversely affected by such waiver.
3 DESIGNATION AND REPLACEMENT OF SCHEDULING ENTITIES

3.1 Designation of Delivery Scheduling Entity. The Delivering Entity may designate a new Delivery Scheduling Entity upon thirty (30) days written notice to Issuer substantially in the form of Attachment 4. Any Scheduling Entity designated in accordance with this Section 3.1 shall commence service at the beginning of a Month, unless mutually agreed in writing between the Delivering Entity and Issuer.

3.2 Assumption by Receipt Scheduling Entity. If any Delivery Scheduling Entity (other than the Delivering Entity) persistently fails to perform its obligations as contemplated under this Communications Protocol, the Receipt Scheduling Entity may, by notice to the Delivering Entity, require that the Delivering Entity deal directly with the Receipt Scheduling Entity until a new Delivery Scheduling Entity is designated in accordance with this Section 3.1.

3.3 Scheduling Coordinator. Project Participant shall designate a scheduling coordinator for the purposes of accepting Base Product delivery at the Base Delivery Point through the scheduling of ISTs.
4 INFORMATION EXCHANGE AND COMMUNICATION BETWEEN ISSUER AND

THE DELIVERING ENTITY

4.1 Communication of Operational Nomination Details.

4.1.1 Not later than three Days prior to each Day during which Base Product is required to be delivered under the Agreement, the Receipt Scheduling Entity for such Delivery Point may deliver an operational nomination in writing (the “Operational Nomination”) indicating any inability of the Project Participant to receive all of its Base Quantities during such Day, which Operational Nomination shall be without prejudice to any party’s rights under the Relevant Contracts for failure to receive Base Quantities.

If no changes to Base Quantities are so submitted, the Operational Nomination shall be deemed to nominate the full Base Quantities required to be delivered on a Day.

4.1.2 Not later than three Days prior to each Day during which Base Product is required to be delivered under the Agreement, the Delivery Scheduling Attachment Staff Report Item 15D
G-4
Entity for such Delivery Point may revise the Operational Nomination to indicate any inability of Prepay LLC to deliver all Base Quantities during such Day, which revised Operational Nomination shall be without prejudice to any party’s rights under the Relevant Contracts for failure to deliver Base Quantities.

4.2 Event-specific Communications.

4.2.1 Remarketing Notices issued by Issuer under the Master Power Supply Agreement shall be substantially in the form of Attachment 2 hereto. Any such notices to remarket must be delivered directly to Prepay LLC and the Delivery Scheduling Entity.

4.2.2 Each Scheduling Entity shall notify Prepay LLC, Issuer and the Project Participant as soon as practicable in the event of: (i) any deficiencies in Scheduling related to such Scheduling Entity; (ii) any deficiencies in Scheduling related to the other such Scheduling Entity; and (iii) any issues with Relevant Third Parties that that would reasonably be expected to create issues related to Product Scheduling under the Relevant Contract. 5 ACCESS AND INFORMATION

Ava Community Energy Board of DirectorsJune 17, 2026

Ava Community Energy Board of Directors
June 17, 2026