Clean Power Alliance Board of Directors
December 5, 2024

19 (b) If Seller anticipates that it will have an RA Shortfall Month, Seller may, provide Replacement RA up to the amount of (i) the Qualifying Capacity with respect to such Showing Month, minus (ii) the expected Net Qualifying Capacity that is able to be included in Seller’s Supply Plan for such Showing Month; provided, any Replacement RA is communicated by Seller to Buyer no later than the Notification Deadline.

3.5 Delivery of RA. Seller shall provide Buyer with the Product and any Replacement RA for each Showing Month consistent with the following:
(a) No later than the Notification Deadline corresponding to each Showing Month of the Delivery Term, Seller shall submit, or cause the Facility’s Scheduling Coordinator to submit, Supply Plans to identify and confirm the Product and any Replacement RA provided to Buyer for each Showing Month.
(b) The Product and any Replacement RA is delivered and received when the CIRA Tool shows that the Supply Plan submitted in compliance with Buyer’s instructions, including Buyer’s instructions to withhold all or part of the Product from Seller’s Supply Plan for any Showing Month during the Delivery Term, has been accepted by the CAISO. If CAISO rejects either the Supply Plan or Buyer’s Resource Adequacy Plan with respect to any part of the Product in any Showing Month, the Parties will confer, make such corrections as are necessary for acceptance, and resubmit the corrected Supply Plan or Resource Adequacy Plan for validation before the applicable Notification Deadline for the relevant Showing Month.

3.6 Failure to Deliver Product.
(a) RA Deficiency Determination. Subject to Section 3.6(c), for each RA Shortfall Month, Seller shall pay to Buyer as liquidated damages the RA Deficiency Amount, as set forth in Section 3.6(b), as the sole remedy for the Product that Seller failed to convey to Buyer. (b) RA Deficiency Amount Calculation. The “RA Deficiency Amount” shall equal to the sum of:
(i) For any portion of the RA Shortfall for which Buyer incurs a CPUC System RA Penalty (“CPUC-Penalized Shortfall”), Seller’s pro rata share of the amount of such CPUC System RA Penalty for such month actually incurred by Buyer (which shall be zero (0) if Buyer does not incur any CPUC System RA Penalty), plus
(ii) For any portion of the RA Shortfall for which Buyer incurs CAISO costs, charges or penalties associated with such shortfall (“CAISO-Penalized Shortfall”) Seller’s pro rata share of the amount of such CAISO costs, charges or penalties associated with the RA Shortfall for such month actually incurred by Buyer (which shall be zero (0) if Buyer does not incur any CAISO costs, charges or penalties associated with the RA Shortfall), plus (iii) For any portion of the RA Shortfall which is not CPUC-Penalized Shortfall and/or CAISO-Penalized Shortfall, and for which Buyer purchased replacement Resource Adequacy Benefits, the amount of Buyer’s cost of such replacement Resource Adequacy Benefits, plus

20 (iv) For any portion of the RA Shortfall which is not CPUC-Penalized Shortfall and/or CAISO-Penalized Shortfall, and for which Buyer did not purchase replacement Resource Adequacy Benefits, the prevailing market value of such RA Shortfall, as reasonably determined by Buyer.
(c) RA Deficiency Amount Cap. Notwithstanding the provisions of Section

3.8(b), for any RA Deficiency Amount for an RA Shortfall associated with a monthly Resource Adequacy showing, the RA Deficiency Amount shall not exceed (i) for the Showing Months of October through June, the product of the RA Shortfall multiplied by the Contract Price; and (ii) for the Showing Months of July through September, the product of the RA Shortfall multiplied by the RA Rate; (ii) for the Showing Month of July, the product of the RA Shortfall multiplied by the RA Rate multiplied by 2.5 (iii) for the Showing Month of August, the product of the RA Shortfall multiplied by the RA Rate multiplied by 4.5; and (iv) for the Showing Month of September, the product of the RA Shortfall multiplied by the RA Rate multiplied by 5.5.

3.7 Monthly RA Capacity Payment. For each Showing Month of the Delivery Term, Buyer shall pay Seller a Monthly RA Capacity Payment equal to the product of (i) the Contract Price, times (ii) the quantity of Installed Capacity, times (iii) 1,000; provided, Buyer’s obligation to make Monthly RA Capacity Payments shall be pro-rated during any month in which a Force Majeure Event reduces the delivered Product or prevents Seller delivering Product. The final product of this Monthly RA Capacity Payment calculation shall be rounded to the nearest penny (i.e., two decimal places). Such payment constitutes the entirety of the amount due to Seller from Buyer for the Product.

3.8 Allocation of Other Payments and Costs.
(a) Seller may retain any revenues it may receive from, and shall pay all costs charged by, the CAISO or any other third party with respect to any Facility, including for (i) start-up, shut-down, and minimum load costs, (ii) capacity revenue for ancillary services, (iii) energy and environmental attribute sales, (iv) any revenues for black start or reactive power services, or (v) the sale of the Facility-contingent call rights on the capacity of the Facility to provide energy to a third party, so long as such rights do not confer on such third party the right to claim any portion of the Product sold hereunder in order to make an RAR Showing with the CAISO or CPUC. (b) Buyer shall be entitled to receive and retain all revenues associated with the Product of the Facility during the Delivery Term (including any capacity or availability revenues from RMR Contracts for any Facility, Reliability Compensation Services Tariff, and Residual Facility Commitment capacity payments, but excluding payments described in Section

3.8(a) above.
(c) In accordance with Section 3.7 of this Agreement:
(i) all such Buyer revenues described in Section 3.8(b) received by Seller, or a Facility’s Scheduling Coordinator, owner, or operator shall be remitted to Buyer, and Seller shall pay such revenues to Buyer if the Facility’s Scheduling Coordinator, owner, or operator fails to remit those revenues to Buyer (and upon any such payment by Seller, Seller shall be subrogated to all rights of Buyer against such Facility’s Scheduling Coordinator, owner, or

21 operator for the amount of such revenues paid). If Seller fails to pay such revenues to Buyer, Buyer may offset any amounts owing to it for such revenues against any future amounts it may owe to Seller under this Agreement.
(ii) all such Seller, or a Facility’s Scheduling Coordinator, owner, or operator revenues described in Section 3.8(a)(i)-(v), but received by Buyer shall be remitted to Seller. If Buyer fails to pay such revenues to Seller, Seller may offset any amounts owing to it for such revenues against any future amounts it may owe to Buyer under this Agreement. (d) Buyer acknowledges and agrees that all Availability Incentive Payments are for the benefit of Seller and for Seller’s account, and that Seller shall receive, retain, or be entitled to receive all credits, payments, and revenues, if any, resulting from Seller achieving or exceeding Availability Standards. The Parties acknowledge and agree that any Non-Availability Charges are the responsibility of Seller, and for Seller’s account and Seller shall be responsible for all fees, charges, or penalties, if any, resulting from Seller failing to achieve Availability Standards.

3.9 Compliance Expenditure Cap. If a change in Law occurring after the Effective Date has increased Seller’s cost to comply with Seller’s obligations under this Agreement with respect to obtaining, maintaining, conveying or effectuating Buyer’s use of Capacity Attributes, then the Parties agree that the maximum aggregate amount of costs and expenses Seller shall be required to bear during the Contract Term to comply with all of such obligations shall be capped at Twenty-Five Thousand Dollars ($25,000) per MW of Guaranteed Capacity (“Compliance Expenditure Cap”).
(a) Any actions required for Seller to comply with its obligations set forth in the first paragraph above, the cost of which will be included in the Compliance Expenditure Cap, shall be referred to collectively as the “Compliance Actions.” (b) If Seller reasonably anticipates the need to incur out-of-pocket expenses in excess of the Compliance Expenditure Cap in order to take any Compliance Action, Seller shall provide Notice to Buyer of such anticipated out-of-pocket expenses. (c) Buyer will have sixty (60) days to evaluate such Notice (during which time period Seller is not obligated to take any Compliance Actions described in the Notice) and shall, within such time, either (1) agree to reimburse Seller for all or some portion of the costs that exceed the Compliance Expenditure Cap (such Buyer-agreed upon costs, the “Accepted Compliance Costs”), or (2) waive Seller’s obligation to take such Compliance Actions, or any part thereof for which Buyer has not agreed to reimburse Seller. If Buyer does not respond to a Notice given by Seller under this Section 3.9(c) within sixty (60) days after Buyer’s receipt of same, Buyer shall be deemed to have waived its rights to require Seller to take the Compliance Actions that are the subject of the Notice, and Seller shall have no further obligation to take, and no liability for any failure to take, such Compliance Actions until such time as Buyer agrees to pay such Accepted Compliance Costs.
(d) If Buyer agrees to reimburse Seller for the Accepted Compliance Costs, then Seller shall take such Compliance Actions covered by the Accepted Compliance Costs as agreed upon by the Parties and Buyer shall reimburse Seller for Seller’s actual costs to effect the

22 Compliance Actions, not to exceed the Accepted Compliance Costs, within sixty (60) days from the time that Buyer receives an invoice and documentation of such costs from Seller.

ARTICLE 4

CAISO OFFER REQUIREMENTS
During the Delivery Term, except to the extent the Facility is on an Outage, Seller shall either schedule or cause the Facility’s Scheduling Coordinator to schedule with, or make available to, the CAISO the Facility’s Net Qualifying Capacity in compliance with the CAISO Tariff, including compliance with Minimum State of Charge, Day-Ahead Availability, Real-Time Availability, Must Offer Obligation, and Default Energy Bid requirements established in Article 40 of the CAISO Tariff, and Seller shall perform all, or cause the Facility’s Scheduling Coordinator, owner, or operator, as applicable, to perform all obligations under the CAISO Tariff that are associated with the sale of Product hereunder. (the “CAISO Offer Requirements”). Buyer shall have no liability for the failure of Seller or the failure of any Facility’s Scheduling Coordinator, owner, or operator to comply with such Tariff provisions, including any penalties or fines imposed on Seller or the Facility’s Scheduling Coordinator, owner, or operator for such noncompliance.

ARTICLE 5
EVENTS OF DEFAULT; REMEDIES

5.1 Events of Default. An “Event of Default” shall mean, with respect to a Party (a “Defaulting Party”), the occurrence of any of the following:
(a) with respect to a Party (the “Defaulting Party”) that is subject to the Event of Default the occurrence of any of the following:
(i) the failure to make, when due, any payment required pursuant to this Agreement if such failure is not remedied within ten (10) Business Days after Notice thereof; (ii) any representation or warranty made by such Party herein is false or misleading in any material respect when made or when deemed made or repeated, and such default is not remedied within thirty (30) days after Notice thereof (or such longer additional period, not to exceed an additional sixty (60) days, if the Defaulting Party is unable to remedy such default within such initial thirty (30)-day period despite exercising commercially reasonable efforts); (iii) the failure to perform any material covenant or obligation set forth in this Agreement (except to the extent constituting a separate Event of Default, and except for Seller’s obligations to deliver the Product, the exclusive remedy for which is provided in Section

3.6) if such failure is not remedied within thirty (30) days after Notice thereof (or such longer additional period, not to exceed an additional ninety (90) days, if the Defaulting Party is unable to remedy such default within such initial thirty (30) days period despite exercising commercially reasonable efforts);
(iv) such Party becomes Bankrupt;

23 (v) such Party assigns this Agreement or any of its rights hereunder other than in compliance with Article 17, if applicable; or (vi) such Party consolidates or amalgamates with, or merges with or into, or transfers all or substantially all of its assets to, another entity and, at the time of such consolidation, amalgamation, merger or transfer, the resulting, surviving or transferee entity fails to assume all the obligations of such Party under this Agreement to which it or its predecessor was a party by operation of law or pursuant to an agreement reasonably satisfactory to the other Party (b) with respect to Seller as the Defaulting Party, the occurrence of any of the following:
(i) the failure by Seller to satisfy the creditworthiness/collateral requirements agreed to pursuant to Article 13 hereof if such failure is not remedied within ten (10) Business Days after written notice;
(ii) if at any time, Seller delivers or attempts to deliver Product to the Delivery Point for sale under this Agreement that was not generated by the Facility, except for Replacement RA;
(iii) Seller sells, assigns, or otherwise transfers, or commits to sell, assign, or otherwise transfer, the Product, or any portion thereof, during the Delivery Term to any party other than Buyer except as expressly permitted under this Agreement; (iv) the failure by Seller to (A) achieve Construction Start on or before the Guaranteed Construction Start Date as such date may be extended by Seller’s payment of Daily Delay Damages pursuant to Section 1(b) of Exhibit B and/or a Development Cure Period pursuant to Section 4 of Exhibit B, or (B) achieve Commercial Operation on or before the Guaranteed Commercial Operation Date, as such date may be extended by Seller’s payment of Commercial Operation Delay Damages pursuant to Section 2 of Exhibit B and/or a Development Cure Period pursuant to Section 4 of Exhibit B;
(v) with respect to any outstanding Letter of Credit provided for the benefit of Buyer that is not then required under this Agreement to be canceled or returned, the failure by Seller to provide for the benefit of Buyer either (1) cash, or (2) a substitute Letter of Credit from a different issuer meeting the criteria set forth in the definition of Letter of Credit, in each case, in the amount required hereunder within ten (10) Business Days after Seller receives Notice of the occurrence of any of the following events:
(A) the issuer of the outstanding Letter of Credit shall fail to maintain a Credit Rating of at least A- by S&P or A3 by Moody’s; (B) the issuer of such Letter of Credit becomes Bankrupt; (C) the issuer of the outstanding Letter of Credit shall fail to comply with or perform its obligations under such Letter of Credit and such failure shall be continuing after the lapse of any applicable grace period permitted under such Letter of Credit;

24 (D) the issuer of the outstanding Letter of Credit shall fail to honor a properly documented request to draw on such Letter of Credit; (E) the issuer of the outstanding Letter of Credit shall disaffirm, disclaim, repudiate or reject, in whole or in part, or challenge the validity of, such Letter of Credit; (F) such Letter of Credit fails or ceases to be in full force and effect at any time; or
(G) Seller shall fail to renew or cause the renewal of each outstanding Letter of Credit on a timely basis as provided in the relevant Letter of Credit and as provided in accordance with this Agreement.

5.2 Remedies; Declaration of an Early Termination Date and Calculation of Settlement Amounts . If an Event of Default with respect to a Defaulting Party shall have occurred, the other Party (the “Non-Defaulting Party”) shall have the following rights:
(a) to send Notice, designating a day, no earlier than the day such Notice is deemed to be received and no later than twenty (20) days after such Notice is deemed to be received, as an early termination date of this Agreement (“Early Termination Date”) that terminates this Agreement (the “Terminated Transaction”) and ends the Delivery Term effective as of the Early Termination Date;
(b) to accelerate all amounts owing between the Parties, and to collect as liquidated damages (i) the Damage Payment, or (ii) the Termination Payment, as applicable, in each case calculated in accordance with Section 5.3 below; (c) withhold any payments due to the Defaulting Party under this Agreement; (d) suspend performance; and
(e) to exercise any other right or remedy available at law or in equity, including specific performance or injunctive relief, except to the extent such remedies are expressly limited under this Agreement.
provided, payment by the Defaulting Party of the Damage Payment or Termination Payment, as applicable, shall constitute liquidated damages and the Non-Defaulting Party’s sole and exclusive remedy for any Terminated Transaction and the Event of Default related thereto.

5.3 Damage Payment; Termination Payment. If an Early Termination Date has been declared, the Non-Defaulting Party shall calculate, in a commercially reasonable manner, the Damage Payment or Termination Payment, as applicable, in accordance with this Section 5.3. (a) Damage Payment Prior to Commercial Operation Date. If the Early Termination Date occurs before the Commercial Operation Date, then the Damage Payment shall be calculated in accordance with this Section 5.3(a).

25 (i) If Seller is the Defaulting Party, then the Damage Payment shall be owed to Buyer and shall be a dollar amount that equals the amount of the Development Security plus, if the Development Security is posted as cash, amount and any interest accrued thereon.

Buyer shall be entitled to immediately retain for its own benefit those funds held as Development Security and any interest accrued thereon if the Development Security is posted as cash, and any amount of Development Security that Seller has not yet posted with Buyer shall be immediately due and payable by Seller to Buyer. There will be no amounts owed to Seller. The Parties agree that Buyer’s damages in the event of an Early Termination Date prior to the Commercial Operation Date caused by Seller’s default would be difficult or impossible to determine and that the damages set forth in this Section 5.3(a)(i) are a reasonable approximation of Buyer’s harm or loss. (ii) If Buyer is the Defaulting Party, then the Damage Payment shall be owed to Seller and shall equal the sum of the actual, documented and verifiable costs incurred by Seller between the Effective Date and the Early Termination Date in connection with the Facility, less the fair market value (determined in a commercially reasonable manner) of (A) all Seller’s assets individually, or (B) the entire Facility, whichever is greater on the Early Termination Date, regardless of whether or not any Seller asset or the entire Facility is actually sold or disposed of.

There will be no amount owed to Buyer. The Parties agree that Seller’s damages in the event of an Early Termination Date prior to the Commercial Operation Date caused by Buyer’s default would be difficult or impossible to determine and that the damages set forth in this Section 5.3(a)(ii) are a reasonable approximation of Seller’s harm or loss.
(b) The payment owed by the Defaulting Party to the Non-Defaulting Party for a Terminated Transaction occurring after the Commercial Operation Date (“Termination Payment”) shall be the aggregate of all Settlement Amounts plus any and all other amounts due to or from the Non-Defaulting Party (as of the Early Termination Date) netted into a single amount.

The Non-Defaulting Party shall calculate, in a commercially reasonable manner, a Settlement Amount for the Terminated Transaction as of the Early Termination Date. Third parties supplying information for purposes of the calculation of Gains or Losses may include, without limitation, dealers in the relevant markets, end-users of the relevant product, information vendors and other sources of market information. The Settlement Amount shall not include consequential, incidental, punitive, exemplary, indirect or business interruption damages. Without prejudice to the Non-Defaulting Party’s duty to mitigate, the Non-Defaulting Party shall not have to enter into replacement transactions to establish a Settlement Amount. Each Party agrees and acknowledges that (i) the actual damages that the Non-Defaulting Party would incur in connection with a Terminated Transaction would be difficult or impossible to predict with certainty, (ii) the Termination Payment described in this Section 5.3(b) is a reasonable and appropriate approximation of such damages, and (iii) the Termination Payment described in this Section 5.3(b) is the exclusive remedy of the Non-Defaulting Party in connection with a Terminated Transaction but shall not otherwise act to limit any of the Non-Defaulting Party’s rights or remedies if the Non-Defaulting Party does not elect a Terminated Transaction as its remedy for an Event of Default by the Defaulting Party.

5.4 Notice of Payment of Termination Payment. As soon as practicable after a Terminated Transaction, but in no event later than sixty (60) days after the Early Termination Date, Notice shall be given by the Non-Defaulting Party to the Defaulting Party of the amount of the Damage Payment or Termination Payment, as applicable, and whether the Termination Payment

27 6.2 Payment. Buyer shall make payment to Seller of Monthly RA Capacity Payments for Product (and any other amounts due) by wire transfer or ACH payment to the bank account provided on each monthly invoice. Buyer shall pay undisputed invoice amounts by the later of (a) ten (10) Business Days after Buyer’s receipt of the invoice from Seller, and (b) the thirtieth (30th) day of the month after the operational month for which such invoice was rendered; provided, if such due date falls on a weekend or legal holiday, such due date shall be the next Business Day. Payments made after the due date will be considered late and will bear interest on the unpaid balance. If the amount due is not paid on or before the due date or if any other payment that is due and owing from one Party to another is not paid on or before its applicable due date, a late payment charge shall be applied to the unpaid balance and shall be added to the next billing statement. Such late payment charge shall be calculated based on an annual interest rate equal to the prime rate published on the date of the invoice in The Wall Street Journal (or, if The Wall Street Journal is not published on that day, the next succeeding date of publication), plus two percent (2%) (the “Interest Rate”). If the due date occurs on a day that is not a Business Day, the late payment charge shall begin to accrue on the next succeeding Business Day.

6.3 Payment Adjustments; Billing Errors. Payment adjustments shall be made if Buyer or Seller discovers there have been good faith inaccuracies in invoicing that are not otherwise disputed under Section 6.4 or an adjustment to an amount previously invoiced or paid is required due to a correction of data by the CAISO, or there is determined to have been a meter inaccuracy sufficient to require a payment adjustment. If the required adjustment is in favor of Buyer, Buyer’s next monthly payment shall be credited in an amount equal to the adjustment. If the required adjustment is in favor of Seller, Seller shall add the adjustment amount to Buyer’s next monthly invoice. Adjustments in favor of either Buyer or Seller shall bear interest, until settled in full, in accordance with Section 6.2, accruing from the date on which the adjusted amount should have been due.

6.4 Billing Disputes. A Party may, in good faith, dispute the correctness of any invoice or any adjustment to an invoice rendered under this Agreement or adjust any invoice for any arithmetic or computational error within twelve (12) months of the date the invoice, or adjustment to an invoice, was rendered. In the event an invoice or portion thereof, or any other claim or adjustment arising hereunder, is disputed, payment of the undisputed portion of the invoice shall be required to be made when due. Any invoice dispute or invoice adjustment shall be in writing and shall state the basis for the dispute or adjustment. Payment of the disputed amount shall not be required until the dispute is resolved. Upon resolution of the dispute, any required payment shall be made within five (5) Business Days of such resolution along with interest accrued at the Interest Rate from and including the original due date to but excluding the date paid.

Inadvertent overpayments shall be returned via adjustments in accordance with Section 6.3. Any dispute with respect to an invoice is waived if the other Party is not notified in accordance with this Section 6.4 within twelve (12) months after the invoice is rendered or subsequently adjusted, except to the extent any misinformation was from a third party not affiliated with any Party and such third party corrects its information after the twelve-month period. If an invoice is not rendered within twelve (12) months after the close of the month during which performance occurred, the right to payment for such performance is waived.

6.5 Netting of Payments. The Parties hereby agree that they shall discharge mutual debts and payment obligations due and owing to each other under this Agreement on the

28 same date through netting, in which case all amounts owed by each Party to the other Party for the purchase and sale of Product during the monthly billing period under this Agreement, including any related damages calculated pursuant to Sections 3.7, interest, and payments or credits, shall be netted so only the excess amount remaining due shall be paid by the Party who owes it.

6.6 Payment Obligation Absent Netting. If no mutual debts or payment obligations exist and only one Party owes a debt or obligation to the other during the monthly billing period, including, but not limited to, any related damage amounts calculated pursuant to Sections 3.7, interest, and payments or credits, that Party shall pay such sum in full when due.

6.7 Security. Unless the Party benefiting from Performance Security notifies the other Party in writing, and except in connection with a liquidation and termination in accordance with Article 5, all amounts netted pursuant to this Article 6 shall not take into account or include any Performance Security which may be in effect to secure a Party’s performance under this Agreement.

ARTICLE 7

LIMITATIONS

7.1 Limitation of Remedies, Liability and 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 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. IF NO REMEDY OR MEASURE OF DAMAGES IS EXPRESSLY PROVIDED HEREIN, THE OBLIGOR’S LIABILITY SHALL BE LIMITED TO

DIRECT ACTUAL DAMAGES ONLY, SUCH DIRECT ACTUAL DAMAGES SHALL BE

THE SOLE AND EXCLUSIVE REMEDY AND ALL OTHER REMEDIES OR DAMAGES AT LAW OR IN EQUITY ARE WAIVED. UNLESS EXPRESSLY HEREIN PROVIDED,

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 SET FORTH IN THIS AGREEMENT 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 THE NEGLIGENCE OF ANY PARTY,

WHETHER SUCH NEGLIGENCE BE SOLE, JOINT OR CONCURRENT, OR ACTIVE OR PASSIVE. TO THE EXTENT ANY DAMAGES REQUIRED TO BE PAID HEREUNDER ARE

LIQUIDATED, THE PARTIES ACKNOWLEDGE THAT THE DAMAGES ARE DIFFICULT

OR IMPOSSIBLE TO DETERMINE, OR OTHERWISE OBTAINING AN ADEQUATE

REMEDY IS INCONVENIENT AND THE DAMAGES CALCULATED HEREUNDER CONSTITUTE A REASONABLE APPROXIMATION OF THE HARM OR LOSS.

7.2 Liquidated Damages. TO THE EXTENT ANY DAMAGES REQUIRED TO BE PAID HEREUNDER ARE LIQUIDATED, INCLUDING UNDER SECTIONS 3.6, 5.2 AND

29 5.3 AND EXHIBIT B, THE PARTIES ACKNOWLEDGE THAT THE DAMAGES ARE

DIFFICULT OR IMPOSSIBLE TO DETERMINE, THAT OTHERWISE OBTAINING AN

ADEQUATE REMEDY IS INCONVENIENT, AND THAT THE LIQUIDATED DAMAGES

CONSTITUTE A REASONABLE APPROXIMATION OF THE ANTICIPATED HARM OR LOSS. 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 THE NEGLIGENCE OF ANY

PARTY, WHETHER SUCH NEGLIGENCE BE SOLE, JOINT OR CONCURRENT, OR ACTIVE OR PASSIVE. THE PARTIES HEREBY WAIVE ANY RIGHT TO CONTEST SUCH PAYMENTS AS AN UNREASONABLE PENALTY.

ARTICLE 8

TAXES, GOVERNMENTAL CHARGES

8.1 Cooperation. Each Party shall use reasonable efforts to implement the provisions of and administer this Agreement in accordance with the intent of the Parties to minimize all Taxes, so long as no Party is materially adversely affected by such efforts. The Parties shall cooperate to minimize Tax exposure; provided, neither Party shall be obligated to incur any financial or operational burden to reduce Taxes for which the other Party is responsible hereunder without receiving due compensation therefor from the other Party. All Product delivered by Seller to Buyer hereunder shall be a sale made at wholesale, with Buyer reselling such Product.

8.2 Governmental Charges. Seller shall pay or cause to be paid all Taxes on or with respect to the Facility or on or with respect to the sale and making available of Product to Buyer, that are imposed on Product prior to its delivery to Buyer at the time and place contemplated under this Agreement. Buyer shall pay or cause to be paid all Taxes on or with respect to the delivery to and purchase by Buyer of Product that are imposed on Product at and after its delivery to Buyer at the time and place contemplated under this Agreement (other than withholding or other Taxes imposed on Seller’s income, revenue, receipts or employees). If a Party is required to remit or pay Taxes that are the other Party’s responsibility hereunder, such Party shall promptly pay the Taxes due and then seek and receive reimbursement from the other for such Taxes. In the event any sale of Product hereunder is exempt from or not subject to any particular Tax, Buyer shall provide Seller with all necessary documentation to evidence such exemption or exclusion within thirty (30) days after the date Buyer makes such claim. Buyer shall indemnify, defend, and hold Seller harmless from any liability with respect to Taxes for which Buyer is responsible hereunder and from which Buyer claims it is exempt.

ARTICLE 9
REPRESENTATIONS; WARRANTIES; COVENANTS

9.1 Mutual Representations and Warranties. On the Effective Date, each Party represents and warrants to the other Party that:
(a) it is duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation;

30 (b) it has all regulatory authorizations necessary for it to legally perform its obligations under this Agreement, except all permits necessary to construct, operate and maintain the Facility and sell the Product therefrom in the case of Seller; (c) the execution, delivery and performance of this Agreement are within its powers, have been duly authorized by all necessary action and do not violate any of the terms and conditions in its governing documents, any contracts to which it is a party or any law, rule, regulation, order or the like applicable to it;
(d) this Agreement and each other document executed and delivered in accordance with this Agreement constitutes its legally valid and binding obligation enforceable against it in accordance with its terms; subject to any Equitable Defenses. (e) it is not Bankrupt and there are no proceedings pending or being contemplated by it or, to its knowledge, threatened against it which would result in it being or becoming Bankrupt;
(f) there is not pending or, to its knowledge, threatened against it or any of its Affiliates any legal proceedings that could materially adversely affect its ability to perform its obligations under this Agreement;
(g) no Event of Default would occur as a result of its entering into or performing its obligations under this Agreement;
(h) it is acting for its own account, has made its own independent decision to enter into this Agreement and as to whether this Agreement is appropriate or proper for it based upon its own judgment, is not relying upon the advice or recommendations of the other Party in so doing, and is capable of assessing the merits of and understanding, and understands and accepts, the terms, conditions and risks of this Agreement;
(i) it is a “forward contract merchant” within the meaning of the United States Bankruptcy Code; and
(j) it has entered into this Agreement in connection with the conduct of its business and it has the capacity or ability to make or take delivery of Product.

9.2 Buyer and Seller Covenants. Buyer and Seller shall, throughout the Delivery Term, take all commercially reasonable actions and execute any and all documents or instruments reasonably necessary to ensure Buyer’s right to the use of the Product, and any Replacement RA, for the sole benefit of Buyer (or any subsequent purchaser under Article 11). Such commercially reasonable actions shall include, without limitation:
(a) Cooperating with and providing, and in the case of Seller causing the Facility’s Scheduling Coordinator, owner, or operator to cooperate with and provide requested supporting documentation to the CAISO, the CPUC, or any other Governmental Authority responsible for administering RAR under applicable Law, to certify or qualify the Product as RA Capacity. Such actions shall include, without limitation, providing information requested by the CAISO, CPUC, or by an LRA having jurisdiction, to demonstrate for each month of the Delivery

31 Term the ability to deliver the Product from the Facility to the CAISO Controlled Grid for the minimum hours required to qualify as RA Capacity, and providing information requested by the CPUC, CAISO or other Governmental Authority having jurisdiction to administer RAR to demonstrate that the Product can be delivered to the CAISO Controlled Grid, pursuant to “deliverability” standards established by the CAISO, or other Governmental Authority having jurisdiction to administer RAR; and
(b) Negotiating in good faith to make necessary amendments, if any, to this Agreement to conform it to subsequent clarifications, revisions, or decisions rendered by the CAISO, CPUC, FERC, or other Governmental Authority having jurisdiction to administer RAR so as to maintain the benefits of the bargain struck by the Parties on the Effective Date; provided, such commercially reasonable actions shall not include any obligation that the owner or operator of the Facility undertake capital improvements, Facility enhancements, or the construction of new facilities nor in any way limit the Parties with respect to advocacy for any regulatory policies or market changes before any entity.

9.3 Seller Representations, Warranties and Covenants. Seller represents, warrants and covenants to Buyer that:
(a) Throughout the Delivery Term, Seller grants, pledges, assigns and otherwise commits to Buyer all the Product from the Facility; (b) Throughout the Delivery Term, Seller owns or has the exclusive right to the Capacity Attributes sold under this Agreement, and shall furnish Buyer, CAISO, CPUC or other jurisdictional LRA, or other Governmental Authority with such evidence as may reasonably be requested to demonstrate such ownership or exclusive right; (c) Throughout the Delivery Term, no portion of the Product has been committed by Seller to any third party in order to satisfy RAR or analogous obligations in CAISO markets, other than pursuant to an RMR Contract between the CAISO and either Seller or the Facility’s owner or operator;
(d) Throughout the Delivery Term, no portion of the Product has been committed by Seller in order to satisfy RAR or analogous obligations in any non-CAISO market; (e) The Facility is within the CAISO Control Area and Seller shall maintain Site Control throughout the Delivery Term;
(f) Throughout the Delivery Term, the owner or operator of the Facility is obligated to comply with applicable Law, including the CAISO Tariff, relating to RAR; (g) Throughout the Delivery Term, the respective cumulative amounts of RAR Attributes that Seller has sold, assigned or transferred from the Facility does not exceed that Facility’s RA Capacity;
(h) Throughout the Delivery Term, with respect to the Product provided under this Agreement, Seller shall, and the Facility’s Scheduling Coordinator is obligated to, comply with applicable Law, including the CAISO Tariff, relating to RAR;

32 (i) Seller has notified the Scheduling Coordinator of the Facility that, throughout the Delivery Term, Seller has transferred the Product to Buyer, and the Scheduling Coordinator is obligated to deliver the Supply Plans in accordance with this Agreement and the CAISO Tariff;
(j) Seller has notified the Scheduling Coordinator of the Facility that Seller is obligated, throughout the Delivery Term, to cause the Facility’s Scheduling Coordinator to provide to the Buyer, at least twenty (20) Business Days before the Notification Deadline, the Product of the Facility that is to be submitted in the Supply Plan associated with this Agreement for the applicable period; and
(k) Seller has notified the Facility’s Scheduling Coordinator that, throughout the Delivery Term, Buyer is entitled to the revenues set forth in Section 3.8 of this Agreement and that such Scheduling Coordinator is obligated to promptly deliver those revenues to Buyer, along with appropriate documentation supporting the amount of those revenues.

9.4 Buyer Representations, Warranties and Covenants. As of the Effective Date, Buyer represents and warrants as follows:
(a) Buyer is a joint powers authority and a validly existing community choice aggregator, duly organized, validly existing and in good standing under the laws of the State of California and the rules, regulations and orders of the California Public Utilities Commission, and is qualified to conduct business in each jurisdiction of the Joint Powers Agreement members. All Persons making up the governing body of Buyer are the elected or appointed incumbents in their positions and hold their positions in good standing in accordance with the Joint Powers Agreement and other Law.
(b) Buyer warrants and covenants that with respect to its contractual obligations under this Agreement, it will not claim immunity on the grounds of sovereignty or similar grounds with respect to itself or its revenues or assets from (1) suit, (2) jurisdiction of court, (3) relief by way of injunction, order for specific performance or recovery of property, (4) attachment of assets, or (5) execution or enforcement of any judgment. (c) Buyer is a “local public entity” as defined in Section 900.4 of the Government Code of the State of California.
(d) Buyer cannot assert sovereign immunity as a defense to the enforcement of its obligations under this Agreement.

9.5 General Covenants. Each Party covenants that commencing on the Effective Date and continuing throughout the Contract Term:
(a) It shall continue to be duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation and to be qualified to conduct business in each jurisdiction where the failure to so qualify would have a material adverse effect on its business or financial condition;

33 (b) It shall maintain (or obtain from time to time as required) all regulatory authorizations necessary for it to legally perform its obligations under this Agreement; and (c) It shall perform its obligations under this Agreement in compliance with all terms and conditions in its governing documents and in material compliance with any Law.

9.6 Workforce Development. The Parties acknowledge that Buyer is committed to creating community benefits, which includes engaging a skilled and trained workforce and targeted hires. Accordingly, prior to the Guaranteed Construction Start Date, Seller shall ensure that work performed in connection with construction of the Facility prior to the Commercial Operation Date will be conducted using a project labor agreement providing for terms and conditions of employment with applicable labor organizations, and shall remain compliant with such agreement in accordance with the terms thereof. Seller shall provide documentation reasonably satisfactory to Buyer demonstrating Seller’s compliance with the requirements of this Section 9.6.

ARTICLE 10

CONFIDENTIALITY

10.1 Definition of Confidential Information. The following constitutes “Confidential Information,” whether oral or written which is delivered by Seller to Buyer or by Buyer to Seller including: (a) the terms and conditions of, and proposals and negotiations related to, this Agreement, and (b) information that either Seller or Buyer stamps or otherwise identifies as “confidential” or “proprietary” before disclosing it to the other. Confidential Information does not include (i) information that was publicly available at the time of the disclosure, other than as a result of a disclosure in breach of this Agreement; (ii) information that becomes publicly available through no fault of the recipient after the time of the delivery; (iii) information that was rightfully in the possession of the recipient (without confidential or proprietary restriction) at the time of delivery or that becomes available to the recipient from a source not subject to any restriction against disclosing such information to the recipient; and (iv) information that the recipient independently developed without a violation of this Agreement.

10.2 Duty to Maintain Confidentiality. The Party receiving Confidential Information (the “Receiving Party”) from the other Party (the “Disclosing Party”) shall not disclose Confidential Information to a third party (other than the Party’s employees, lenders, investors, counsel, accountants, directors or advisors, or any such representatives of a Party’s Affiliates, who have a need to know such information and have agreed to keep such terms confidential) except in order to comply with any applicable Law, regulation, or any exchange, control area or independent system operator rule or in connection with any court or regulatory proceeding applicable to such Party or any of its Affiliates; provided, each Party shall, to the extent practicable, use reasonable efforts to prevent or limit the disclosure. The Parties shall be entitled to all remedies available at law or in equity to enforce, or seek relief in connection with, this confidentiality obligation. The Parties agree and acknowledge that nothing in this Section 10.2 prohibits a Party from disclosing any one or more of the commercial terms of a transaction (other than the name of the other Party unless otherwise agreed to in writing by the Parties) to any industry

34 price source for the purpose of aggregating and reporting such information in the form of a published energy price index.

The Parties acknowledge and agree that the Agreement and any transactions entered into in connection herewith are subject to the requirements of the California Public Records Act (Government Code Section 7920.000 et seq.). In order to designate information as confidential, the Disclosing Party must clearly stamp and identify the specific portion of the material designated with the word “Confidential.” The Parties agree not to over-designate material as Confidential Information. Over-designation includes stamping whole agreements, entire pages or series of pages as “Confidential” that clearly contain information that is not Confidential Information.

Upon request or demand of any third person or entity not a Party hereto to Buyer pursuant to the California Public Records Act for production, inspection and/or copying of Confidential Information (“Requested Confidential Information”), Buyer shall as soon as practical notify Seller in writing via email that such request has been made. Seller shall be solely responsible for taking at its sole expense whatever legal steps are necessary to prevent release of the Requested Confidential Information to the third party by Buyer. If Seller takes no such action after receiving the foregoing notice from Buyer, Buyer shall, at its discretion, be permitted to comply with the third party’s request or demand and is not required to defend against it. If Seller does take or attempt to take such action, Buyer shall provide timely and reasonable cooperation to Seller, if requested by Seller, and Seller agrees to indemnify and hold harmless Buyer, its officers, employees and agents (“Buyer’s Indemnified Parties”), from any claims, liability, award of attorneys’ fees, or damages, and to defend any action, claim or lawsuit brought against any of Buyer’s Indemnified Parties for Buyer’s refusal to disclose any Requested Confidential Information.

10.3 Irreparable Injury; Remedies. Receiving Party acknowledges that its obligations hereunder are necessary and reasonable in order to protect Disclosing Party and the business of Disclosing Party, and expressly acknowledges that monetary damages would be inadequate to compensate Disclosing Party for any breach or threatened breach by Receiving Party of any covenants and agreements set forth herein. Accordingly, Receiving Party acknowledges that any such breach or threatened breach will cause irreparable injury to Disclosing Party and that, in addition to any other remedies that may be available, in law, in equity or otherwise, Disclosing Party will be entitled to obtain injunctive relief against the threatened breach of this Agreement or the continuation of any such breach, without the necessity of proving actual damages.

10.4 Further Permitted Disclosure. Notwithstanding anything to the contrary in this Article 10:
(a) Confidential Information may be disclosed by the Receiving Party to any of its agents, consultants, contractors, trustees, or actual or potential financing parties (including, in the case of Seller, its Lender(s)), so long as such Person to whom Confidential Information is disclosed agrees in writing to be bound by confidentiality provisions that are at least as restrictive as this Article 10 to the same extent as if it were a Party; and

35 (b) The Parties agree that Buyer may disclose information pertaining to this Agreement to any Governmental Authority, the CPUC, the CAISO or any LRA having jurisdiction in order to support its RAR Showings, and Seller may disclose the transfer of the Product under this Agreement to the Scheduling Coordinator of the Facility in order for such Scheduling Coordinator to timely submit accurate Supply Plans; provided, each disclosing Party shall use reasonable efforts to limit, to the extent possible, the ability of any such applicable Governmental Authority, CAISO, or Scheduling Coordinator to further disclose such information. In addition, in the event Buyer resells all or any portion of the Product to another party, Buyer shall be permitted to disclose to the other party to such resale transaction all such information to the extent such disclosure is necessary to affect such resale transaction, provided that such other party agrees to keep such information confidential.

ARTICLE 11
BUYER’S RE-SALE OF PRODUCT

11.1 Buyer Resale Rights. Buyer may re-sell all or a portion of the Product and any associated rights, in each case, acquired under this Agreement. If Buyer re-sells all or a portion of the Product and any associated rights acquired under this Agreement (“Resold Product”), Seller agrees, and agrees to cause the Facility’s Scheduling Coordinator, to follow Buyer’s reasonable instructions with respect to providing such Resold Product to subsequent purchasers of such Resold Product to the extent such instructions are consistent with Seller’s obligations under this Agreement.

11.2 Scheduling Coordinator Cooperation. Seller further agrees, and agrees to cause the Facility’s Scheduling Coordinator, to take all commercially reasonable actions and execute any and all documents or instruments reasonably necessary to allow such subsequent purchasers to use such Resold Product in a manner consistent with Buyer’s rights under this Agreement to the extent such actions, documents or instruments are otherwise consistent with Seller’s obligations under this Agreement. If Buyer incurs any liability to any purchaser of such Resold Product due to the failure of Seller or the Facility’s Scheduling Coordinator to comply with the terms of this Agreement, then Seller shall be liable to Buyer for any liabilities Seller would have incurred under this Agreement if Buyer had not resold the Product, including without limitation, pursuant to Section 3.4.

11.3 Resale Notification. In the event there is any Resold Product, Buyer agrees to notify Seller that such a sale has occurred and agrees to provide Seller with the information specified below promptly following such sale (and any other information reasonably requested by Seller so that Seller may perform its obligations in this Article 11) and promptly notify Seller of any subsequent changes to such information with respect to any particular sale: (i) benefitting LSE’s SC identification number (SCID), (ii) volume (in MW) of Resold Product, and (iii) subsequent sale delivery period for Resold Product.

11.4 Centralized Capacity Market Participation. If a centralized capacity market develops within the CAISO or WECC region, Buyer will have exclusive rights to offer, bid, or otherwise submit Product sold to Buyer pursuant to this Agreement for re-sale in such market, and

36 retain and receive any and all related revenues. Buyer shall be responsible for any material, incremental costs of offering, bidding, submitting, or re-selling Product in such centralized capacity market.

ARTICLE 12

CHANGE IN ELECTRIC MARKET DESIGN
If a change in the CAISO Tariff renders this Agreement or any provisions hereof incapable of being performed or administered, then any Party may request that Buyer and Seller enter into negotiations to make the minimum changes to this Agreement necessary to make this Agreement capable of being performed and administered, while attempting to preserve to the maximum extent possible the benefits, burdens, and obligations set forth in this Agreement as of the Effective Date.

Upon delivery of such a request, Buyer and Seller shall engage in such negotiations in good faith.

If Buyer and Seller are unable, within sixty (60) days after delivery of such request, to agree upon changes to this Agreement or to resolve issues relating to changes to this Agreement, then any Party may submit issues pertaining to changes to this Agreement to the dispute resolution process set forth in Article 15. Notwithstanding the foregoing, (i) a change in cost shall not in and of itself be deemed to render this Agreement or any of the provisions hereof incapable of being performed or administered, and (ii) all of the unaffected provisions of this Agreement shall remain in full force and effect during any period of such negotiation or dispute resolution.

ARTICLE 13

COLLATERAL REQUIREMENTS

13.1 Seller’s Development Security. To secure its obligations under this Agreement, Seller shall deliver the Development Security to Buyer within thirty (30) days after the Effective Date. Seller shall maintain the Development Security in full force and effect until Buyer is required to return such Development Security hereunder. Upon the earlier of (a) Seller’s delivery of the Performance Security, or (b) sixty (60) days after termination of this Agreement, Buyer shall return the Development Security to Seller, less the amounts drawn in accordance with this Agreement.

13.2 Performance Security. To secure its obligations under this Agreement, Seller shall deliver Performance Security to Buyer on or before the Commercial Operation Date. Seller shall maintain the Performance Security in full force and effect, and Seller shall within ten (10) Business Days after any draw thereon replenish the Performance Security in the event Buyer collects or draws down any portion of the Performance Security for any reason permitted under this Agreement other than to satisfy a Termination Payment, until the following have occurred: (a) the Delivery Term has expired or terminated early; and (b) all payment obligations of Seller due and payable under this Agreement, including compensation for penalties, Termination Payment, indemnification payments or other damages are paid in full (whether directly or indirectly such as through set-off or netting). Following the occurrence of both events, Buyer shall promptly return to Seller the unused portion of the Performance Security.

13.3 First Priority Security Interest in Cash or Cash Equivalent Collateral.

38 (b) Employer’s Liability Insurance. Employers’ Liability insurance shall not be less than One Million Dollars ($1,000,000.00) for injury or death occurring as a result of each accident. With regard to bodily injury by disease, the One Million Dollar ($1,000,000) policy limit will apply to each employee.
(c) Workers Compensation Insurance. Seller, if it has employees, shall also maintain at all times during the Contract Term workers’ compensation and employers’ liability insurance coverage in accordance with applicable requirements of Law. (d) Business Auto Insurance. Seller shall maintain at all times during the Contract Term business auto insurance for bodily injury and property damage with limits of One Million Dollars ($1,000,000) per occurrence. Such insurance shall cover liability arising out of Seller’s use of all owned (if any), non-owned and hired vehicles, including trailers or semi-trailers in the performance of the Agreement.
(e) Construction All-Risk Insurance. Seller shall maintain or cause to be maintained during the construction of the Facility prior to the Commercial Operation Date, construction all-risk form property insurance covering the Facility during such construction periods, and naming Seller (and Lender if any) as the loss payee. (f) Property Damage Insurance. Seller shall maintain or cause to be maintained during the Delivery Term, property damage insurance with a policy limit of not less than the full replacement cost of the Facility on a per occurrence basis. (g) Pollution Liability Insurance. Seller shall maintain or cause to be maintained during the Contract Term, pollution liability insurance in an amount not less than Two Million Dollars ($2,000,000) each occurrence covering losses involving hazardous material(s) and caused by pollution incidents or conditions that arise from any subcontractor’s performance or lack of performance of work under this Agreement, or might be required by federal, state, regional, municipal, and local laws, including coverage for bodily injury, sickness, disease, mental anguish or shock sustained by any person, including death, property damage including the resulting loss of use thereof, clean-up costs, and the loss of use of tangible property that has not been physically damaged or destroyed, and defense costs. If such coverage is on a “claims made” policy form, any applicable “retroactive date” shall be no later than the Effective Date and shall be maintained for at least two (2) years beyond the termination of this Agreement, to allow for a reasonable extended reporting period.
(h) Subcontractor Insurance. Seller shall require all of its subcontractors to carry: (i) comprehensive general liability insurance with a combined single limit of coverage not less than One Million Dollars ($1,000,000); (ii) workers’ compensation insurance and employers’ liability coverage in accordance with applicable requirements of Law; and (iii) business auto insurance for bodily injury and property damage with limits of one million dollars ($1,000,000) per occurrence. All subcontractors shall name Seller as an additional insured to insurance carried pursuant to clauses (h)(i) and (h)(iii). All subcontractors shall provide a primary endorsement and a waiver of subrogation to Seller for the required coverage pursuant to this Section 14.1(h).

39 (i) Evidence of Insurance. Within ten (10) days after execution of the Agreement and upon annual renewal thereafter, Seller shall deliver to Buyer certificates of insurance evidencing such coverage. Such certificates shall specify that Buyer shall be given at least thirty (30) days prior Notice by Seller in the event of any material modification, cancellation or termination of coverage. All insurance required herein shall be primary coverage without right of contribution from any insurance of Buyer, and such policies shall be endorsed with a waiver of subrogation in favor of Buyer for all work performed by Seller, its employees, agents and subcontractors and any subrogation rights which may pass to Seller’s insurance carriers for the payment of any claims. Any other insurance maintained by Seller is for the exclusive benefit of Seller and shall not in any manner inure to the benefit of Buyer. (j) Failure to Comply with Insurance Requirements. If Seller fails to comply with any of the provisions of this Article 14, Seller, among other things and without restricting Buyer’s remedies under the Law or otherwise, shall, at its own cost and expense, act as an insurer and provide insurance in accordance with the terms and conditions above. With respect to the required general liability, umbrella liability and commercial automobile liability insurance, Seller shall provide a current, full and complete defense to Buyer, its subsidiaries and Affiliates, and their respective officers, directors, shareholders, agents, employees, assigns, and successors in interest, in response to a third-party claim in the same manner that an insurer would have, had the insurance been maintained in accordance with the terms and conditions set forth above. In addition, alleged violations of the provisions of this Article 14 means that Seller has the initial burden of proof regarding any legal justification for refusing or withholding coverage and Seller shall face the same liability and damages as an insurer for wrongfully refusing or withholding coverage in accordance with the laws of California.

ARTICLE 15

FORCE MAJEURE

15.1 Definition.
(a) “Force Majeure Event” means any act or event that delays or prevents a Party from timely performing all or a portion of its obligations under this Agreement or from complying with all or a portion of the conditions under this Agreement if such act or event, despite the exercise of commercially reasonable efforts, cannot be avoided by and is beyond the reasonable control (whether direct or indirect) of and without the fault or negligence of the Party relying thereon as justification for such delay, nonperformance, or noncompliance. (b) Without limiting the generality of the foregoing, so long as the following events, despite the exercise of reasonable efforts, cannot be avoided by, and are beyond the reasonable control (whether direct or indirect) of and without the fault or negligence of the Party relying thereon as justification for such delay, nonperformance or noncompliance, a Force Majeure Event may include an act of God or the elements, such as flooding, lightning, hurricanes, tornadoes, or ice storms; explosion; fire; volcanic eruption; flood; epidemic or pandemic, landslide; mudslide; sabotage; terrorism; earthquake; or other cataclysmic events; an act of public enemy; war; blockade; civil insurrection; riot; civil disturbance; or strikes caused or suffered by a Party or any third party except as set forth below.

40 (c) Notwithstanding the foregoing, the term “Force Majeure Event” does not include (i) economic conditions or changes in Law that render a Party’s performance of this Agreement at the Contract Price unprofitable or otherwise uneconomic (including an increase in component or compliance costs for any reason, including foreign or domestic tariffs, Buyer’s ability to buy Product at a lower price, or Seller’s ability to sell the Product, or any component thereof, at a higher price, than under this Agreement); (ii) Seller’s inability to obtain permits or approvals of any type for the construction, operation, or maintenance of the Facility, except to the extent such inability is caused by a Force Majeure Event; (iii) the inability of a Party to make payments when due under this Agreement, unless the cause of such inability is a failure of payment systems or other inability to process payments that is caused by an event that would otherwise constitute a Force Majeure Event as described above; (iv) a Curtailment Order; (v) Seller’s inability to obtain sufficient labor, equipment, materials, or other resources to build or operate the Facility, including the lack of wind, sun or other fuel source of an inherently intermittent nature, except to the extent such inability is caused by a Force Majeure Event; (vi) a strike, work stoppage or labor dispute limited only to any one or more of Seller, Seller’s Affiliates, Seller’s contractors, their subcontractors thereof or any other third party employed by Seller to work on the Facility; (vii) any equipment failure except if such equipment failure is caused by a Force Majeure Event; or (viii)any action or inaction by any third party, including Transmission Provider, that delays or prevents the approval, construction or placement in service of any Interconnection Facilities or Network Upgrades, except to the extent caused by a Force Majeure Event.

15.2 No Liability If a Force Majeure Event Occurs. Except as provided in Exhibit B, neither Seller nor Buyer shall be liable to the other Party in the event it is prevented from performing its obligations hereunder in whole or in part due to a Force Majeure Event. The Party rendered unable to fulfill any obligation by reason of a Force Majeure Event shall take reasonable actions necessary to remove such inability with due speed and diligence. Nothing herein shall be construed as permitting that Party to continue to fail to perform after said cause has been removed. The obligation to use due speed and diligence shall not be interpreted to require resolution of labor disputes by acceding to demands of the opposition when such course is inadvisable in the discretion of the Party having such difficulty. Neither Party shall be considered in breach or default of this Agreement if and to the extent that any failure or delay in the Party’s performance of one or more of its obligations hereunder is caused by a Force Majeure Event. The occurrence and continuation of a Force Majeure Event shall not suspend or excuse the obligation of a Party to make any payments due hereunder.

15.3 Notice. In order to claim a Force Majeure Event, the claiming Party, within fourteen (14) days after becoming aware of a reasonable likelihood of an impact on the Claiming Party’s performance hereunder following the initial occurrence of the claimed Force Majeure Event, must give the other Party Notice describing the particulars of the occurrence in substantially the form set forth in Exhibit H, (b) provide timely evidence reasonably sufficient to establish that the occurrence constitutes Force Majeure as defined in this Agreement, and (c) notify the other Party in writing of the cessation or termination of such Force Majeure Event, all as known or estimated in good faith by the affected Party.

15.4 Termination Following Force Majeure Event or Development Cure Period.

42 (b) Seller shall indemnify, defend and hold harmless Buyer and its Affiliates, directors, officers, employees from and against all claims, demands, losses, liabilities, penalties, and expenses (including reasonable attorneys’ fees) in connection with any claims of infringement upon or violation of any trade secret, trademark, trade name, copyright, patent, or other intellectual property rights of any third party by equipment, software, applications or programs (or any portion of same) used in connection with the Facility (an “IP Indemnity Claim”). (c) Nothing in this Section 16.1 shall enlarge or relieve Seller or Buyer of any liability to the other for any breach of this Agreement. Neither Party shall be indemnified for its damages resulting from its sole negligence, intentional acts or willful misconduct. These indemnity provisions shall not be construed to relieve any insurer of its obligation to pay claims consistent with the provisions of a valid insurance policy.

16.2 Claims. Promptly after receipt by a Party of any claim or Notice of the commencement of any action, administrative, or legal proceeding, or investigation as to which the indemnity provided for in this Article 16 may apply, the Indemnified Party shall notify the Indemnifying Party in writing of such fact. The Indemnifying Party shall assume the defense thereof with counsel designated by the Indemnifying Party and satisfactory to the Indemnified Party; provided, if the defendants in any such action include both the Indemnified Party and the Indemnifying Party and the Indemnified Party shall have reasonably concluded that there may be legal defenses available to it which are different from or additional to, or inconsistent with, those available to the Indemnifying Party, the Indemnified Party shall have the right to select and be represented by separate counsel, at the Indemnifying Party’s expense, unless a liability insurer is willing to pay such costs. If the Indemnifying Party fails to assume the defense of a claim meriting indemnification, the Indemnified Party may at the expense of the Indemnifying Party contest, settle, or pay such claim; provided, settlement or full payment of any such claim may be made only following consent of the Indemnifying Party or, absent such consent, written opinion of the Indemnified Party’s counsel that such claim is meritorious or warrants settlement. Except as otherwise provided in this Article 16, in the event that a Party is obligated to indemnify and hold the other Party and its successors and assigns harmless under this Article 16, the amount owing to the Indemnified Party will be the amount of the Indemnified Party’s damages net of any insurance proceeds received by the Indemnified Party following a reasonable effort by the Indemnified Party to obtain such insurance proceeds.

ARTICLE 17

ASSIGNMENT

17.1 General Prohibition on Assignments. Except as provided below in this Article 17, neither Party may voluntarily assign this Agreement or its rights or obligations under this Agreement, without the prior written consent of the other Party, which consent shall not be unreasonably withheld, conditioned or delayed. Any Change of Control of Seller (whether voluntary or by operation of law) will be deemed an assignment and will require the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed; provided, a Change of Control of Seller shall not require Buyer’s consent if the assignee or transferee is a Permitted Transferee. Any assignment made without the required written consent, or in violation of the conditions to assignment set out below, shall be null and void. Seller shall be responsible for Buyer’s reasonable costs associated with the preparation, review, execution and

43 delivery of documents in connection with any assignment of this Agreement by Seller, including without limitation reasonable attorneys’ fees.

17.2 Collateral Assignment. Subject to the provisions of this Section 17.2, Seller has the right to assign this Agreement as collateral for any financing or refinancing of the Facility.

In connection with any financing or refinancing of the Facility, Buyer shall in good faith work with Seller and Lender to execute a consent to collateral assignment of this Agreement substantially in the form attached hereto as Exhibit F and with such changes as may be reasonably agreed to by the Parties and Lender (“Collateral Assignment Agreement”).

17.3 Permitted Assignment by Seller. Seller may, without the prior written consent of Buyer, transfer or assign this Agreement to: (a) an Affiliate of Seller or (b) any Person succeeding to all or substantially all of the assets of Seller (whether voluntary or by operation of law); if, and only if:
(a) the assignee is a Permitted Transferee;
(b) Seller has given Buyer Notice at least fifteen (15) Business Days before the date of such proposed assignment; and
(c) Seller has provided Buyer a written agreement signed by the Person to which Seller wishes to assign its interests that (x) provides that such Person will assume all of Seller’s obligations and liabilities under this Agreement upon such transfer or assignment and (y) certifies that such Person meets the definition of a Permitted Transferee.

Notwithstanding the foregoing, any assignment by Seller, its successors or assigns under this Section 17.3 shall be of no force and effect unless and until such Notice and agreement by the assignee have been received and accepted by Buyer.

17.4 Shared Facilities; Portfolio Financing. Buyer agrees and acknowledges that Seller may elect to finance all or any portion of the Facility or the Interconnection Facilities or the Shared Facilities (1) utilizing tax equity or cash equity investment, and/or (2) through a Portfolio Financing, which may include cross-collateralization or similar arrangements. In connection with any financing or refinancing of the Facility, the Interconnection Facilities or the Shared Facilities by Seller or any Portfolio Financing, Buyer, Seller, Portfolio Financing Entity (if any), and Lender shall execute and deliver such further consents, approvals and acknowledgments as may be reasonable and necessary to facilitate such transactions; provided, Buyer shall not be required to agree to any terms or conditions which are reasonably expected to have a material adverse effect on Buyer and all reasonable attorney’s fees incurred by Buyer in connection therewith shall be borne by Seller.

ARTICLE 18

DISPUTE RESOLUTION

18.1 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

44 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]

18.2 Dispute Resolution. In the event of any dispute arising under this Agreement, within ten (10) Business Days following the receipt of a Notice from either Party identifying such dispute, the Parties shall meet, negotiate and attempt, in good faith, to resolve the dispute quickly, informally and inexpensively. If the Parties are unable to resolve a dispute arising hereunder within the earlier of either forty-five (45) days of initiating such discussions, or within sixty (60) days after Notice of the dispute, either Party may seek any and all remedies available to it at law or in equity, subject to the limitations set forth in this Agreement.

18.3 Attorneys’ Fees. In any proceeding brought to enforce this Agreement or because of the breach by any Party of any covenant or condition herein contained, each Party shall bear its own respective costs, expenses and attorneys’ fees in connection with said action.

18.4 Venue. In the event of any legal action to enforce or interpret this Agreement, the sole and exclusive venue shall be a court of competent jurisdiction located in Los Angeles County, California, and the Parties hereto agree to and do hereby submit to the jurisdiction of such court, and waive any claim or defense that such forum is not convenient or proper.

ARTICLE 19

NOTICES

19.1 Addresses for the Delivery of Notices. Any Notice required, permitted, or contemplated hereunder shall be in writing, shall be addressed to the Party to be notified at the address set forth in Exhibit E or at such other address or addresses as a Party may designate for itself from time to time by Notice hereunder.

19.2 Acceptable Means of Delivering Notice. Each Notice required, permitted, or contemplated hereunder shall be deemed to have been validly served, given or delivered as follows: (a) if sent by United States mail with proper first class postage prepaid, three (3) Business Days following the date of the postmark on the envelope in which such Notice was deposited in the United States mail; (b) if sent by a regularly scheduled overnight delivery carrier with delivery fees either prepaid or an arrangement with such carrier made for the payment of such fees, the next Business Day after the same is delivered by the sending Party to such carrier; (c) if sent by electronic communication (including electronic mail or other electronic means) at the time indicated by the time stamp upon delivery and, if after 5 pm, on the next Business Day; or (d) if delivered in person, upon receipt by the receiving Party. Notwithstanding the foregoing, Notices of outages or other scheduling or dispatch information or requests, may be sent by electronic communication and shall be considered delivered upon successful completion of such transmission.

45 ARTICLE 20

MISCELLANEOUS

20.1 Title and Risk of Loss. Title to and risk of loss related to the Product shall transfer from Seller to Buyer upon Seller’s delivery of Product in accordance with Section 3.5.

Seller warrants that it will deliver to Buyer the Product free and clear of all liens, security interests, claims and encumbrances or any interest therein or thereto by any person.

20.2 Mobile-Sierra. Notwithstanding any other provision of this Agreement, neither Party shall seek, nor shall they support any third party seeking, to prospectively or retroactively revise the rates, terms or conditions of service of this Agreement through application or complaint to FERC pursuant to the provisions of Section 205, 206 or 306 of the Federal Power Act, or any other provisions of the Federal Power Act, absent prior written agreement of the Parties. Further, absent the prior written agreement in writing by both Parties, the standard of review for changes to the rates, terms or conditions of service of this Agreement proposed by a Party shall be the “public interest” 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). Changes proposed by a non-Party or FERC acting sua sponte shall be subject to the most stringent standard permissible under applicable Law.

20.3 Entire Agreement; Integration; Exhibits. This Agreement, together with the Cover Sheet and Exhibits attached hereto constitutes the entire agreement and understanding between Seller and Buyer with respect to the subject matter hereof and supersedes all prior agreements relating to the subject matter hereof, which are of no further force or effect. The Exhibits attached hereto are integral parts hereof and are made a part of this Agreement by reference. The headings used herein are for convenience and reference purposes only. In the event of a conflict between the provisions of this Agreement and those of the Cover Sheet, the provisions of first the Cover Sheet, and then this Agreement shall prevail. This Agreement shall be considered for all purposes as prepared through the joint efforts of the Parties and shall not be construed against one Party or the other as a result of the preparation, substitution, submission or other event of negotiation, drafting or execution hereof.

20.4 No Waiver. Waiver by a Party of any default by the other Party shall not be construed as a waiver of any other default.

20.5 No Agency, Partnership, Joint Venture or Lease. Seller and the agents and employees of Seller shall, in the performance of this Agreement, act in an independent capacity and not as officers or employees or agents of Buyer. Under this Agreement, Seller and Buyer intend to act as energy seller and energy purchaser, respectively, and do not intend to be treated as, and shall not act as, partners in, co-venturers in or lessor/lessee with respect to the Facility or any business related to the Facility. This Agreement shall not impart any rights enforceable by any third party (other than a permitted successor or assignee bound to this Agreement) and/or, to the extent set forth herein, any Lender and/or Indemnified Party.

20.6 Severability. In the event that any provision of this Agreement is unenforceable or held to be unenforceable, the Parties agree that all other provisions of this Agreement have force and effect and shall not be affected thereby. The Parties shall, however, use

46 their best endeavors to agree on the replacement of the void, illegal or unenforceable provision(s) with legally acceptable clauses which correspond as closely as possible to the sense and purpose of the affected provision and this Agreement as a whole.

20.7 Forward Contract. The Parties acknowledge and agree that this Agreement constitutes a “forward contract” within the meaning of the U.S. Bankruptcy Code, and Buyer and Seller are “forward contract merchants” within the meaning of the U.S. Bankruptcy Code. Each Party further agrees that, for all purposes of this Agreement, each Party waives and agrees not to assert the applicability of the provisions of 11 U.S.C. § 366 in any Bankruptcy proceeding wherein such Party is a debtor. In any such proceeding, each Party further waives the right to assert that the other Party is a provider of last resort to the extent such term relates to 11 U.S.C. §366 or another provision of 11 U.S.C. § 101-1532.

20.8 Counterparts. This Agreement may be executed in one or more counterparts, all of which taken together shall constitute one and the same instrument and each of which shall be deemed an original.

20.9 Electronic Delivery. This Agreement may be duly executed and delivered by a Party by electronic format (including portable document format (.pdf)) delivery of the signature page of a counterpart to the other Party.

20.10 No Recourse to Members of Buyer. Buyer is organized as a Joint Powers Authority in accordance with the Joint Exercise of Powers Act of the State of California (Government Code Section 6500, et seq.) pursuant to its Joint Powers Agreement and is a public entity separate from its constituent members. Buyer shall solely be responsible for all debts, obligations and liabilities accruing and arising out of this Agreement. Seller shall have no rights and shall not make any claims, take any actions or assert any remedies against any of Buyer’s constituent members, or the employees, directors, officers, consultants or advisors of Buyer or its constituent members, in connection with this Agreement.

20.11 Market-Based Rate Authority. Seller agrees, in accordance with Federal Energy Regulatory Commission (FERC) Order No. 697, to, upon request of Buyer, submit a letter of concurrence in support of any affirmative statement by Buyer that this Agreement does not transfer “ownership or control of generation capacity” from Seller to Buyer as the term “ownership or control of generation capacity” is used in 18 CFR Section 35.42. Seller also agrees that it will not, in filings, if any, made subject to Order Nos. 652 and 697, claim that this Agreement conveys ownership or control of generation capacity from Seller to Buyer. [Remainder of Page Intentionally Left Blank]

Signature Page
IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the Effective Date.

OLINDA RELIABILITY PROJECT LLC CLEAN POWER ALLIANCE OF
SOUTHERN CALIFORNIA, a California
joint powers authority
By: __________________________ By: __________________________ Name: __________________________ Name: __________________________ Title: __________________________ Title: __________________________

Exhibit B - 1

EXHIBIT B

FACILITY CONSTRUCTION AND COMMERCIAL OPERATION

1. Construction of the Facility.
(a) “Construction Start” will occur upon Seller’s acquisition of all applicable regulatory authorizations, approvals and permits for the construction of the Facility, and once Seller has engaged all contractors, and ordered all essential equipment and supplies as, in each case, can reasonably be considered necessary so that physical construction of the Facility may begin and proceed to completion without foreseeable interruption of material duration, and has executed an engineering, procurement, and construction contract and issued thereunder a final notice to proceed that authorizes the contractor to mobilize to Site and begin physical construction (including, at a minimum, excavation for foundations or the installation or erection of improvements) at the Site. The date of Construction Start will be evidenced by and subject to Seller’s delivery to Buyer of a certificate substantially in the form attached as Exhibit C-2 hereto, and the date certified therein shall be the “Construction Start Date.” Seller shall cause Construction Start to occur no later than the Guaranteed Construction Start Date. (b) Seller may extend the Guaranteed Construction Start Date by paying Daily Delay Damages to Buyer for each day Seller desires to extend the Guaranteed Construction Start Date, not to exceed a total of one hundred twenty (120) days of extensions by such payment of Daily Delay Damages. On or before the date that is ten (10) days prior to the then-current Guaranteed Construction Start Date Seller shall provide notice and payment to Buyer of the Daily Delay Damages for the number of days of extension to the Guaranteed Construction Start Date. This process shall apply to the original Guaranteed Construction Start Date extension period and any subsequent extensions via payment of Daily Delay Damages. If Seller achieves Construction Start prior to the Guaranteed Construction Start Date, as extended by the payment of Daily Delay Damages, Buyer shall refund to Seller the Daily Delay Damages for each day Seller achieves Construction Start prior to the Guaranteed Construction Start Date times the Daily Delay Damages, not to exceed the total amount of Daily Delay Damages paid by Seller pursuant to this Section 1(b). Additionally, if Seller achieves Commercial Operation on or before the Guaranteed Commercial Operation Date (not including any extensions to such date resulting from Seller’s payment of Commercial Operation Delay Damages, but as may be extended pursuant to a Development Cure Period), then Buyer shall refund to Seller all Daily Delay Damages paid by Seller and not previously refunded by Buyer.

2. Commercial Operation of the Facility. “Commercial Operation” means the condition existing when Seller has fulfilled all of the conditions precedent in Section 2.2 of the Agreement and provided Notice to Buyer substantially in the form of Exhibit C-1 (the “COD Certificate”).
(a) Seller shall cause Commercial Operation for the Facility to occur by the Guaranteed Commercial Operation Date. Seller shall notify Buyer that it intends to achieve Commercial Operation at least sixty (60) days before the anticipated Commercial Operation Date. (b) Seller may extend the Guaranteed Commercial Operation Date by paying

Exhibit B - 3
(d) Buyer has not made all necessary arrangements to deliver Charging Energy to, receive the Facility Energy at, the Delivery Point by the Guaranteed Commercial Operation Date.

Seller shall submit any claim for Development Cure Period delays within (x) five (5) Business Days of the applicable milestone in the case of (a), (c) or (d) above, and (y) fourteen (14) days after becoming aware of a reasonable likelihood of an impact on Seller’s performance hereunder following the initial occurrence of the claimed Force Majeure Event in the case of (b) above, in substantially the form set forth in Exhibit H. Notwithstanding anything in this Agreement to the contrary, the cumulative extensions granted under the Development Cure Period (other than the extensions granted pursuant to clause 4(d) above) shall not exceed one hundred eighty (180) days, for any reason, including a Force Majeure Event, and the cumulative extensions granted to the Guaranteed Commercial Operation Date by the payment of Commercial Operation Delay Damages and any Development Cure Period(s) (other than the extensions granted pursuant to clause 4(d) above) shall not exceed ( ) days. Upon request from Buyer, Seller shall provide documentation demonstrating to Buyer’s reasonable satisfaction that the delays described above did not result from Seller’s actions or failure to take commercially reasonable actions.

5. Failure to Reach Guaranteed Capacity. If, at Commercial Operation, the Installed Capacity is less than one hundred percent (100%) of the Guaranteed Capacity, Seller shall have ninety (90) days after the Commercial Operation Date to install additional capacity and/or Network Upgrades such that the Installed Capacity is equal to (but not greater than) the Guaranteed Capacity, and Seller shall provide to Buyer a new certificate substantially in the form attached as Exhibit C-1 hereto specifying the new Installed Capacity. If Seller fails to construct the Guaranteed Capacity by such date, Seller shall pay “Capacity Damages” to Buyer, in an amount equal to Two Hundred Fifty Thousand Dollars ($250,000) for each MW that the Guaranteed Capacity exceeds the Installed Capacity, and the Guaranteed Capacity and other applicable portions of the Agreement shall be adjusted accordingly. Capacity Damages shall not be offset or reduced by the payment of Development Security, Performance Security, Delay Damages, or any other form of liquidated damages under this Agreement.

6. Buyer’s Right to Draw on Development Security. If Seller fails to timely pay any Daily Delay Damages or Commercial Operation Delay Damages, Buyer may draw upon the Development Security to satisfy Seller’s payment obligation thereof.

Exhibit C - 1
EXHIBIT C-1

FORM OF COMMERCIAL OPERATION DATE CERTIFICATE
This certification (“Certification”) of Commercial Operation is delivered by _______[licensed professional engineer] (“Engineer”) to Clean Power Alliance of Southern California, a California joint powers authority (“Buyer”) in accordance with the terms of that certain Resource Adequacy Agreement dated _______ (“Agreement”) by and between Olinda Reliability Project LLC and Buyer. All capitalized terms used in this Certification but not otherwise defined herein shall have the respective meanings assigned to such terms in the Agreement.

As of _______[DATE]_____, Engineer hereby certifies and represents to Buyer the following:
(a) The Facility is fully operational, reliable and interconnected, fully integrated and synchronized with the Transmission System.
(b) Seller has installed equipment for the Facility with an Installed Capacity of no less than ninety percent (90%) of the Guaranteed Capacity.
(c) Authorization to parallel the Facility was obtained by the Transmission Provider, [Name of Transmission Provider as appropriate] on___[DATE]____. (d) The Transmission Provider has provided documentation supporting full unrestricted release for Commercial Operation by [Name of Transmission Provider as appropriate] on _______[DATE]_____.
(e) The CAISO has provided notification supporting Commercial Operation, in accordance with the CAISO Tariff on _______[DATE]_____.

EXECUTED by [LICENSED PROFESSIONAL ENGINEER]
this ________ day of _____________, 20__.
[LICENSED PROFESSIONAL ENGINEER]
By:

Its:

Exhibit C - 2
EXHIBIT C-2

FORM OF CONSTRUCTION START DATE CERTIFICATE
This certification of Construction Start Date (“Certification”) is delivered by Olinda Reliability Project LLC (“Seller”) to Clean Power Alliance of Southern California, a California joint powers authority (“Buyer”) in accordance with the terms of that certain Resource Adequacy Agreement dated __________ (“Agreement”) by and between Seller and Buyer. All capitalized terms used in this Certification but not otherwise defined herein shall have the respective meanings assigned to such terms in the Agreement.

Seller hereby certifies and represents to Buyer the following:
(1) Construction Start (as defined in Exhibit B of the Agreement) has occurred, and a copy of the notice to proceed that Seller issued to its contractor as part of Construction Start is attached hereto.
(2) the Construction Start Date occurred on _____________ (the “Construction Start Date”); and
(3) the precise Site on which the Facility is located is, which must be within the boundaries of the previously identified Site:
_____________________________________________________________________ (such description shall amend the description of the Site in Exhibit A of the Agreement).

IN WITNESS WHEREOF, the undersigned has executed this Certification on behalf of Seller as of the ___ day of ________20__.
[SELLER ENTITY]
By:

Its:

Date:

Exhibit D - 1

EXHIBIT D

PROGRESS REPORTING FORM
Each Progress Report must include the following items:

1. Executive Summary.

2. Facility description.

3. Site plan of the Facility.

4. Description of any material planned changes to the Facility or the Site.

5. Gantt chart schedule showing progress on achieving each of the Milestones.

6. Summary of activities during the previous calendar quarter or month, as applicable, including any OSHA labor hour reports.

7. Forecast of activities scheduled for the current calendar quarter or month, as applicable.

8. Written description about the progress relative to Seller’s Milestones, including whether Seller has met or is on target to meet the Milestones.

9. List of issues that are reasonably likely to affect Seller’s Milestones.

10. A status report of start-up activities including a forecast of activities ongoing and after start-up, a report on Facility performance including performance projections for the next twelve (12) months.

11. Progress and schedule of all material agreements, contracts, permits (including Material Permits), approvals, technical studies, financing agreements and major equipment purchase orders showing the start dates, completion dates, and completion percentages.

12. Pictures, in sufficient quantity and of appropriate detail, in order to document construction and startup progress of the Facility, the interconnection into the Transmission System and all other interconnection utility services.

13. Workforce Development or Supplier Diversity Reporting (if applicable). Format to be provided by Buyer.

14. Any other documentation reasonably requested by Buyer.

Exhibit F - 1

EXHIBIT F

FORM OF CONSENT TO COLLATERAL ASSIGNMENT
This Consent to Collateral Assignment (this “Consent”) is entered into among (i) Clean Power Alliance of Southern California, a California joint powersauthority (“CPA”), (ii) [Name of Seller], a [Legal Status of Seller] (the “Project Company”), and (iii) [Name of Collateral Agent], a [Legal Status of Collateral Agent], as Collateral Agent for the secured parties under the Financing Documents referred to below (such secured parties together with their successors permitted under this Consent in such capacity, the “Secured Parties”, and, such agent, together with its successors in such capacity, the “Collateral Agent”). CPA, Project Company and Collateral Agent are hereinafter sometimes referred to individually as a “Party” and jointly as the “Parties”.

Capitalized terms used but not otherwise defined in this Consent shall have the meanings ascribed to them in the RAA (as defined below).

RECITALS
The Parties enter into this Consent with reference to the following facts:

A. Project Company and CPA have entered into that certain Resource Adequacy Agreement, dated as of [Date] [List all amendments as contemplated by Section 3.3] (“RAA”), pursuant to which Project Company will develop, construct, commission, test and operate the Facility and sell the Product to CPA, and CPA will purchase the Product from Project Company;
B. As collateral for Project Company’s obligations under the RAA, Project Company has agreed to provide to CPA certain collateral, which may include Performance Security and other collateral described in the RAA (collectively, the “RAA Collateral”); C. Project Company has entered into that certain [Insert description of financing arrangements with Lender], dated as of [Date], among Project Company, the Lenders party thereto and the Collateral Agent (the “Financing Agreement”), pursuant to which, among other things, the Lenders have extended commitments to make loans to Project Company; D. As collateral security for Project Company’s obligations under the Financing Agreement and related agreements (collectively, the “Financing Documents”), Project Company has, among other things, assigned all of its right, title and interest in, to and under the RAA and Project’s Company’s owners have pledged their ownership interest in Project Company (collectively, the “Assigned Interest”) to the Collateral Agent pursuant to the Financing Documents; and
E. It is a requirement under the Financing Agreement and the RAA that CPA and the other Parties hereto shall have executed and delivered this Consent.

Exhibit F - 2

AGREEMENT
In consideration of the foregoing, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, and intending to be legally bound, the Parties hereto hereby agree as follows:

SECTION 1. CONSENT TO ASSIGNMENT, ETC.

1.1 Consent and Agreement. CPA hereby acknowledges:
(a) Notice of and consents to the assignment as collateral security to Collateral Agent, for the benefit of the Secured Parties, of the Assigned Interest; and (b) The right (but not the obligation) of Collateral Agent in the exercise of its rights and remedies under the Financing Documents, to make all demands, give all notices, take all actions and exercise all rights of Project Company permitted under the RAA (subject to CPA’s rights and defenses under the RAA and the terms of this Consent) and accepts any such exercise; provided, insofar as the Collateral Agent exercises any such rights under the RAA or makes any claims with respect to payments or other obligations under the RAA, the terms and conditions of the RAA applicable to such exercise of rights or claims shall apply to Collateral Agent to the same extent as to Project Company.

1.2 Project Company’s Acknowledgement.

Each of Project Company and Collateral Agent hereby acknowledges and agrees that CPA is authorized to act in accordance with Collateral Agent’s instructions, and that CPA shall bear no liability to Project Company or Collateral Agent in connection therewith, including any liability for failing to act in accordance with Project Company’s instructions.

1.3 Right to Cure.

If Project Company defaults in the performance of any of its obligations under the RAA, or upon the occurrence or non-occurrence of any event or condition under the RAA which would immediately or with the passage of any applicable grace period or the giving of notice, or both, enable CPA to terminate or suspend its performance under the RAA (a “RAA Default”), CPA will not terminate or suspend its performance under the RAA until it first gives written notice of such RAA Default to Collateral Agent and affords Collateral Agent the right to cure such RAA Default within the applicable cure period under the RAA, which cure period shall run concurrently with that afforded Project Company under the RAA. In addition, if Collateral Agent gives CPA written notice prior to the expiration of the applicable cure period under the RAA of Collateral Agent’s intention to cure such RAA Default (which notice shall include a reasonable description of the time during which it anticipates to cure such RAA Default) and is diligently proceeding to cure such RAA Default, notwithstanding the applicable cure period under the RAA, Collateral Agent shall have a period of sixty (60) days (or, if such RAA Default is for failure by the Project Company to pay an amount to CPA which is due and payable under the RAA other than to provide RAA Collateral, thirty (30) days, or, if such RAA Default is for failure by Project Company to provide RAA Collateral, ten (10) Business Days) from the Collateral Agent’s receipt of the notice of such

Exhibit F - 3
RAA Default from CPA to cure such RAA Default; provided, (a) if possession of the Facility is necessary to cure any such non-monetary RAA Default and Collateral Agent has commenced foreclosure proceedings within sixty (60) days after notice of the RAA Default and is diligently pursuing such foreclosure proceedings, Collateral Agent will be allowed a reasonable time, not to exceed one hundred eighty (180) days after the notice of the RAA Default, to complete such proceedings and cure such RAA Default, and (b) if Collateral Agent is prohibited from curing any such RAA Default by any process, stay or injunction issued by any Governmental Authority or pursuant to any bankruptcy or insolvency proceeding or other similar proceeding involving Project Company, then the time periods specified herein for curing a RAA Default shall be extended for the period of such prohibition, so long as Collateral Agent has diligently pursued removal of such process, stay or injunction. Collateral Agent shall provide CPA with reports concerning the status of efforts to cure a RAA Default upon CPA’s reasonable request.

1.4 Substitute Owner.

Subject to Section 1.7, the Parties agree that if Collateral Agent notifies (such notice, a “Financing Document Default Notice”) CPA that an event of default has occurred and is continuing under the Financing Documents (a “Financing Document Event of Default”) then, upon a judicial foreclosure sale, non-judicial foreclosure sale, deed in lieu of foreclosure or other transfer following a Financing Document Event of Default, Collateral Agent (or its designee) shall be substituted for Project Company (the “Substitute Owner”) under the RAA, and, subject to Sections

1.7(b) and 1.7(c) below, CPA and Substitute Owner will recognize each other as counterparties under the RAA and will continue to perform their respective obligations (including those obligations accruing to CPA and the Project Company prior to the existence of the Substitute Owner) under the RAA in favor of each other in accordance with the terms thereof; provided, before CPA is required to recognize the Substitute Owner, the Substitute Owner must have demonstrated to CPA’s reasonable satisfaction that the Substitute Owner is a Permitted Transferee, as defined in the RAA. For purposes of the foregoing, CPA shall be entitled to assume that any such purported exercise of rights by Collateral Agent that results in substitution of a Substitute Owner under the RAA is in accordance with the Financing Documents without independent investigation thereof but shall have the right to require that the Collateral Agent and its designee (if applicable) provide reasonable evidence demonstrating the same.

1.5 Replacement Agreements.

Subject to Section 1.7, if the RAA is terminated, rejected or otherwise invalidated as a result of any bankruptcy, insolvency, reorganization or similar proceeding affecting Project Company, its owner(s) or guarantor(s), and if Collateral Agent or its designee directly or indirectly takes possession of, or title to, the Facility (including possession by a receiver or title by foreclosure or deed in lieu of foreclosure) (“Replacement Owner”), CPA shall, and Collateral Agent shall cause Replacement Owner to, enter into a new agreement with one another for the balance of the obligations under the RAA remaining to be performed having terms substantially the same as the terms of the RAA with respect to the remaining Contract Term (“Replacement RAA”); provided, before CPA is required to enter into a Replacement RAA, the Replacement Owner must have demonstrated to CPA’s reasonable satisfaction that the Replacement Owner satisfies the requirements of a Permitted Transferee. For purposes of the foregoing, CPA is entitled to assume that any such purported exercise of rights by Collateral Agent that results in a Replacement Owner

Exhibit F - 4
is in accordance with the Financing Documents without independent investigation thereof but shall have the right to require that the Collateral Agent and its designee (if applicable) provide reasonable evidence demonstrating the same. Notwithstanding the execution and delivery of a Replacement RAA, to the extent CPA is, or was otherwise prior to its termination as described in this Section 1.5, entitled under the RAA, CPA may suspend performance of its obligations under such Replacement RAA, unless and until all RAA Defaults of Project Company under the RAA or Replacement RAA have been cured.

1.6 Transfer.

Subject to Section 1.7, a Substitute Owner or a Replacement Owner may assign all of its interest in the Facility and the RAA and a Replacement RAA to a natural person, corporation, trust, business trust, joint venture, joint stock company, association, company, limited liability company, partnership, Governmental Authority or other entity (a “Person”) to which the Facility is transferred; provided, the proposed transferee shall have demonstrated to CPA’s reasonable satisfaction that such proposed transferee satisfies the requirements of a Permitted Transferee.

1.7 Assumption of Obligations.
(a) Transferee.

Any transferee under Section 1.6 shall expressly assume in a writing reasonably satisfactory to CPA all of the obligations of Project Company, Substitute Owner or Replacement Owner under the RAA or Replacement RAA, as applicable, including posting and collateral assignment of the RAA Collateral. Upon such assignment and the cure of any outstanding RAA Default, and payment of all other amounts due and payable to CPA in respect of the RAA or such Replacement RAA, the transferor shall be released from any further liability under the RAA or Replacement RAA, as applicable.
(b) Substitute Owner.

Subject to Section 1.7(c), any Substitute Owner pursuant to Section 1.4 shall be required to perform Project Company’s obligations under the RAA, including posting and collateral assignment of the RAA Collateral; provided, the obligations of such Substitute Owner shall be no more than those of Project Company under the RAA.
(c) No Liability.

CPA acknowledges and agrees that neither Collateral Agent nor any Secured Party shall have any liability or obligation under the RAAas a result of this Consent (except to the extentCollateral Agent or a Secured Party is a Substitute Owner or Replacement Owner) nor shall Collateral Agent or any other Secured Party be obligated or required to (i) perform any of Project Company’s obligations under the RAA, except as provided in Sections 1.7(a) and 1.7(b) and to the extent Collateral Agent or a Secured Party is a Substitute Owner or Replacement Owner, or (ii) take any action to collect or enforce any claim for payment assigned under the Financing Documents. If Collateral Agent becomes a Substitute Owner pursuant to Section 1.4 or enters into a Replacement RAA, Collateral Agent shall not have any personal liability to CPA under the RAA or Replacement RAA and the sole recourse of CPA in seeking enforcement of such obligations against Collateral

Exhibit F - 5
Agent shall be to the aggregate interest of the Secured Parties in the Facility; provided, such limited recourse shall not limit CPA’s right to seek equitable or injunctive relief against Collateral Agent, or CPA’s rights with respect to any offset rights expressly allowed under the RAA, a Replacement RAA or the RAA Collateral.

1.8 Delivery of Notices.

CPA shall deliver to Collateral Agent, concurrently with the delivery thereof to Project Company, a copy of each notice, request or demand given by CPA to Project Company pursuant to the RAA relating to (a) a RAA Default by Project Company under the RAA, (b) any claim regarding Force Majeure Event by CPA under the RAA, (c) any notice of dispute under the RAA, (d) any notice of intent to terminate or any termination notice, and (e) any matter that would require the consent of Collateral Agent pursuant to Section 1.11 or any other provision of this Consent. Collateral Agent acknowledges that delivery of such notice, request and demand shall satisfy CPA’s obligation to give Collateral Agent a notice of RAA Default under Section 1.3. Collateral Agent shall deliver to CPA, concurrently with delivery thereof to Project Company, a copy of each notice, request or demand given by Collateral Agent to Project Company pursuant to the Financing Documents relating to a default by Project Company under the Financing Documents.

1.9 Confirmations.

CPA will, as and when reasonably requested by Collateral Agent from time to time, confirm in writing matters relating to the RAA (including the performance of same by Project Company); provided, such confirmation may be limited to matters of which CPA is aware as of the time the confirmation is given and such confirmations shall be without prejudice to any rights of CPA under the RAA as between CPA and Project Company.

1.10 Exclusivity of Dealings.

Except as provided in Sections 1.3, 1.4, 1.8, 1.9 and 2.1, unless and until CPA receives a Financing Document Default Notice, CPA shall deal exclusively with Project Company in connection with the performance of CPA’s obligations under the RAA. From and after such time as CPA receives a Financing Document Default Notice and until a Substitute Owner is substituted for Project Company pursuant to Section 1.4, a Replacement RAA is entered into or the RAA is transferred to a Person to whom the Facility is transferred pursuant to Section 1.6, CPA shall, until Collateral Agent confirms to CPA in writing that all obligations under the Financing Documents are no longer outstanding, deal exclusively with Collateral Agent in connection with the performance of CPA’s obligations under the RAA, and CPA may irrevocably rely on instructions provided by Collateral Agent in accordance therewith to the exclusion of those provided by any other Person.

1.11 No Amendments.

To the extent permitted by Laws, CPA agrees that it will not, without the prior written consent of Collateral Agent (not to be unreasonably withheld, delayed or conditioned) (a) enter into any material supplement, restatement, novation, extension, amendment or modification of the RAA (b) terminate or suspend its performance under the RAA (except in accordance with Section 1.3) or (c) consent to or accept any termination or cancellation of the RAA by Project Company.

Exhibit F - 6
SECTION 2. PAYMENTS UNDER THE RAA

2.1 Payments.

Unless and until CPA receives written notice to the contrary from Collateral Agent, CPA will make all payments to be made by it to Project Company under or by reason of the RAA directly to Project Company. CPA, Project Company, and Collateral Agent acknowledge that CPA will be deemed to be in compliance with the payment terms of the RAA to the extent that CPA makes payments in accordance with Collateral Agent’s instructions.

2.2 No Offset, Etc.

All payments required to be made by CPA under the RAA shall be made without any offset, recoupment, abatement, withholding, reduction or defense whatsoever, other than that expressly allowed by the terms of the RAA.

SECTION 3. REPRESENTATIONS AND WARRANTIES OF CPA
CPA makes the following representations and warranties as of the date hereof in favor of Collateral Agent:

3.1 Organization.

CPA is a joint powers authority and community choice aggregator duly organized and validly existing under the laws of the state of California, and the rules, regulations and orders of the California Public Utilities Commission, and is qualified to conduct business in each jurisdiction of the Joint Powers Agreement members. CPA has all requisite power and authority, corporate and otherwise, to enter into and to perform its obligations hereunder and underthe RAA, and to carry out the terms hereof and thereof and the transactions contemplated hereby and thereby.

3.2 Authorization.

The execution, delivery and performance by CPA of this Consent and the RAA have been duly authorized by all necessary corporate or other action on the part of CPA and do not require any approval or consent of any holder (or any trustee for any holder) of any indebtedness or other obligation of CPA which, if not obtained, will prevent CPA from performing its obligations hereunder or under the RAA except approvals or consents which have previously been obtained and which are in full force and effect.

3.3 Execution and Delivery; Binding Agreements.

Each of this Consent and the RAA is in full force and effect, has been duly executed and delivered on behalf of CPA by the appropriate officers of CPA, and constitutes the legal, valid and binding obligation of CPA, enforceable against CPA in accordance with its terms, except as the enforceability thereof may be limited by (a) bankruptcy, insolvency, reorganization, moratorium or other similar laws of general application affecting the enforcement of creditors’ rights generally and (b) general equitable principles (whether considered in a proceeding in equity or at law).

Exhibit F - 7

3.4 No Default or Amendment.

Except as set forth in Schedule A attached hereto: (a) Neither CPA nor, to CPA’s actual knowledge, Project Company, is in default of any of its obligations under the RAA; (b) CPA and, to CPA’s actual knowledge, Project Company, has complied with all conditions precedent to the effectiveness of its obligations under the RAA; (c) to CPA’s actual knowledge, no event or condition exists which would either immediately or with the passage of any applicable grace period or giving of notice, or both, enable either CPA or Project Company to terminate or suspend its obligations under the RAA; and (d) the RAA has not been amended, modified or supplemented in any manner except as set forth herein and in the recitals hereto.

3.5 No Previous Assignments.

CPA has no notice of, and has not consented to, any previous assignment by Project Company of all or any part of its rights under the RAA, except as previously disclosed in writing and consented to by CPA.

SECTION 4. REPRESENTATIONS AND WARRANTIES OF PROJECT COMPANY Project Company makes the following representations and warranties as of the date hereof in favor of the Collateral Agent and CPA:

4.1 Organization.

Project Company is a [Legal Status of Seller] duly organized and validly existing under the laws of the state of its organization, and is duly qualified, authorized to do business and in good standing in every jurisdiction in which it owns or leases real property or in which the nature of its business requires it to be so qualified, except where the failure to so qualify would not have a material adverse effect on its financial condition, its ability to own its properties or its ability to transact its business. Project Company has all requisite power and authority, corporate and otherwise, to enter into and to perform its obligations hereunder and under the RAA, and to carry out the terms hereof and thereof and the transactions contemplated hereby and thereby.

4.2 Authorization.

The execution, delivery and performance of this Consent by Project Company, and Project Company’s assignment of its right, title and interest in, to and under the RAA to the Collateral Agent pursuant to the Financing Documents, have been duly authorized by all necessary corporate or other action on the part of Project Company.

4.3 Execution and Delivery; Binding Agreement.

This Consent is in full force and effect, has been duly executed and delivered on behalf of Project Company by the appropriate officers of Project Company, and constitutes the legal, valid and binding obligation of Project Company, enforceable against Project Company in accordance with its terms, except as the enforceability thereof may be limited by (a) bankruptcy, insolvency, reorganization, moratorium or other similar laws of general application affecting the enforcement

Exhibit F - 8
of creditors’ rights generally and (b) general equitable principles (whether considered in a proceeding in equity or at law).

4.4 No Default or Amendment.

Except as set forth in Schedule B attached hereto: (a) neither Project Company nor, to Project Company’s actual knowledge, CPA, is in default of any of its obligations under the RAA; (b) Project Company and, to Project Company’s actual knowledge, CPA, has complied with all conditions precedent to the effectiveness of its obligations under the RAA; (c) to Project Company’s actual knowledge, no event or condition exists which would either immediately or with the passage of any applicable grace period or giving of notice, or both, enable either CPA or Project Company to terminate or suspend its obligations under the RAA; and (d) the RAA has not been amended, modified or supplemented in any manner except as set forth herein and in the recitals hereto.

4.5 No Previous Assignments.

Project Company has not previously assigned all or any part of its rights under the RAA.

SECTION 5. REPRESENTATIONS AND WARRANTIES OF COLLATERAL AGENT Collateral Agent makes the following representations and warranties as of the date hereof in favor of CPA and Project Company:

5.1 Authorization.

The execution, delivery and performance of this Consent by Collateral Agent have been duly authorized by all necessary corporate or other action on the part of Collateral Agent and Secured Parties.

5.2 Execution and Delivery; Binding Agreement.

This Consent is in full force and effect, has been duly executed and delivered on behalf of Collateral Agent by the appropriate officers of Collateral Agent, and constitutes the legal, valid and binding obligation of Collateral Agent as Collateral Agent for the Secured Parties, enforceable against Collateral Agent (and the Secured Parties to the extent applicable) in accordance with its terms, except as the enforceability thereof may be limited by (a) bankruptcy, insolvency, reorganization, moratorium or other similar laws of general application affecting the enforcement of creditors’ rights generally and (b) general equitable principles (whether considered in a proceeding in equity or at law).

SECTION 6. MISCELLANEOUS

6.1 Notices.

All notices and other communications hereunder shall be in writing, shall be deemed given upon receipt thereof by the Party or Parties to whom such notice is addressed, shall refer on their face to the RAA (although failure to so refer shall not render any such notice or communication

Exhibit F - 9
ineffective), shall be sent by first class mail, by personal delivery or by a nationally recognized courier service, and shall be directed (a) if to CPA or Project Company, in accordance with [Notice Section of the RAA] of the RAA, (b) if to Collateral Agent, to [Collateral Agent Name], [Collateral Agent Address], Attn: [Collateral Agent Contact Information], Telephone: [___], Fax: [___], and (c) to such other address or addressee as any such Party may designate by notice given pursuant hereto.

6.2 Governing Law; Submission to Jurisdiction.
(a) THIS CONSENT SHALL BE CONSTRUED IN ACCORDANCE WITH, AND

THIS CONSENT AND ALL MATTERS ARISING OUT OF THIS CONSENT AND THE

TRANSACTIONS CONTEMPLATED HEREBY SHALL BE GOVERNED BY, THE LAW OF

THE STATE OF CALIFORNIA WITHOUT REGARD TO ANY CONFLICTS OF LAWS

PROVISIONS THEREOF THAT WOULD RESULT IN THE APPLICATION OF THE LAW OF ANOTHER JURISDICTION.
(b) All disputes, claims or controversies arising out of, relating to, concerning or pertaining to the terms of this Consent shall be governed by the dispute resolution provisions of the RAA. Subject to the foregoing, any legal action or proceeding with respect to this Consent and any action for enforcement of any judgment in respect thereof may be brought in the courts of the State of California or of the United States of America for the Central District of California, and, by execution and delivery of this Consent, each Party hereby accepts for itself and in respect of its property, generally and unconditionally, the non-exclusive jurisdiction of the aforesaid courts and appellate courts from any appeal thereof. Each Party further irrevocably consents to the service of process out of any of the aforementioned courts in any such action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to its notice address provided pursuant to Section 6.1 hereof. Each Party hereby irrevocably waives any objection which it may now or hereafter have to the laying of venue of any of the aforesaid actions or proceedings arising out of or in connection with this Consent brought in the courts referred to above and hereby further irrevocably waives and agrees not to plead or claim in any such court that any such action or proceeding brought in any such court has been brought in an inconvenient forum. Nothing herein shall affect the right of any Party to serve process in any other manner permitted by law.

6.3 Headings Descriptive.

The headings of the several sections and subsections of this Consent are insertedfor convenience only and shall not in any way affect the meaning or construction of any provision of this Consent.

6.4 Severability.

In case any provision in or obligation under this Consent shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby.

6.5 Amendment, Waiver.

Exhibit F - 10
Neither this Consent nor any of the terms hereof may (a) be terminated, amended, supplemented or modified, except by an instrument in writing signed by CPA, Project Company and Collateral Agent or (b) waived, except by an instrument in writing signed by the waiving Party.

6.6 Termination.

Each Party’s obligations hereunder are absolute and unconditional, and no Party has any right, and shall have no right, to terminate this Consent or to be released, relieved or discharged from any obligation or liability hereunder until CPA has been notified by Collateral Agent that all of the obligations under the Financing Documents shall have been satisfied in full (other than contingent indemnification obligations) or, with respect to the RAA or any Replacement RAA, its obligations under such RAA or Replacement RAA have been fully performed.

6.7 Successors and Assigns.

This Consent shall be binding upon each Party and its successors and assigns permitted under and in accordance with this Consent, and shall inure to the benefit of the other Parties and their respective successors and assignee permitted under and in accordance with this Consent. Each reference to a Person herein shall include such Person’s successors and assigns permitted under and in accordance with this Consent.

6.8 Further Assurances.

CPA hereby agrees to execute and deliver all such instruments and take all such action as may be necessary to effectuate fully the purposes of this Consent.

6.9 Waiver of Trial by Jury.

TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE PARTIES HEREBY

IRREVOCABLY WAIVE ALL RIGHT OF TRIAL BY JURY IN ANY ACTION,

PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR IN CONNECTION WITH THIS CONSENT OR ANY MATTER ARISING HEREUNDER. 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.

6.10 Entire Agreement.

This Consent and any agreement, document or instrument attached hereto or referred to herein integrate all the terms and conditions mentioned herein or incidental hereto and supersede all oral negotiations and prior writings in respect to the subject matter hereof. In the event of any conflict between the terms, conditions and provisions of this Consent and any such agreement, document or instrument, the terms, conditions and provisions of this Consent shall prevail.

6.11 Effective Date.

This Consent shall be deemed effective as of the date upon which the last Party executes this Consent.

Exhibit F - 11

6.12 Counterparts; Electronic Signatures.

This Consent may be executed in one or more counterparts, each of which will be deemed to be an original of this Consent and all of which, when taken together, will be deemed to constitute one and the same agreement. The exchange of copies of this Consent and of signature pages by facsimile transmission, Portable Document Format (i.e., PDF), or by other electronic means shall constitute effective execution and delivery of this Consent as to the Parties and may be used in lieu of the original Consent for all purposes.
[Remainder of Page Left Intentionally Blank.]
IN WITNESS WHEREOF, the Parties hereto have caused this Consent to be duly executed and delivered by their duly authorized officers on the dates indicated below their respective signatures.
[NAME OF PROJECT COMPANY],
[Legal Status of Project Company].

CLEAN POWER ALLIANCE OF

SOUTHERN CALIFORNIA,
a California joint powers authority.

By:
___________________________________
[Name]
[Title]
Date: ___________________________
By:
___________________________________
[Name]
[Title]
Date: ___________________________
[NAME OF COLLATERAL AGENT],
[Legal Status of Collateral Agent].

By:
________________________________
[Name]
[Title]
Date: ___________________________

Exhibit G - 1

EXHIBIT G

SUPPLY CHAIN CODE
Buyer is committed to ensuring that the fundamental human rights of workers are protected, including addressing the potential risks of forced labor, child labor, servitude, human trafficking and slavery across our portfolio.

Our requirements and expectations for Seller’s supply chain are detailed below in our Supply Chain Code (“Supply Chain Code”). Seller must comply with all applicable Laws and this Supply Chain Code, even when this Supply Chain Code exceeds the requirements of applicable Law.

These standards are derived from the United Nations Guiding Principles on Business and Human Rights, the Core Conventions of the International Labour Organization (“ILO”), including the ILO Declaration on Fundamental Principles and Rights at work, the Solar Energy Industries Association Solar Industry Commitment to Environmental & Social Responsibility, and the Responsible Business Alliance Code of Conduct.

1. Freely Chosen Employment
Forced, bonded (including debt bondage) or indentured labor, involuntary or exploitative prison labor, slavery or trafficking of persons is not permitted. This includes transporting, harboring, recruiting, transferring, or receiving persons by means of threat, force, coercion, abduction or fraud for labor or services. There shall be no unreasonable restrictions on workers’ freedom of movement in the facility in addition to unreasonable restrictions on entering or exiting company provided facilities including, if applicable, workers’ dormitories or living quarters. All work must be voluntary, and workers shall be free to leave work at any time or terminate their employment without penalty if reasonable notice is given as per worker’s contract. Employers, agents, and subagents may not hold or otherwise destroy, conceal, or confiscate identity or immigration documents, such as government-issued identification, passports, or work permits. Employers can only hold documentation if such holdings are required by law. In this case, at no time should workers be denied access to their documents. Workers shall not be required to pay employers’ agents’ or sub-agents’ recruitment fees or other related fees for their employment. If any such fees are found to have been paid by workers, such fees shall be repaid to the worker.

2. Young Workers
Child labor is not to be used in any stage of manufacturing. The term “child” refers to any person under the age of 15, or under the age for completing compulsory education, or under the minimum age for employment in the country, whichever is greatest. Suppliers shall implement an appropriate mechanism to verify the age of workers. The use of legitimate workplace learning programs, which comply with all laws and regulations, is supported.

Workers under the age of 18 shall not perform work that is likely to jeopardize their health or safety, including night shifts and overtime. Suppliers shall ensure proper management of student workers through proper maintenance of student records, rigorous due diligence of educational partners, and protection of students’ rights in accordance with applicable laws and regulations. Suppliers shall provide appropriate support and training to all student workers. In the absence of local law, the wage rate for student workers, interns, and

Exhibit G - 2
apprentices shall be at least the same wage rate as other entry-level workers performing equal or similar tasks. If child labor is identified, assistance/remediation is provided.

3. Working Hours
Studies of business practices clearly link worker strain to reduced productivity, increased turnover, and increased injury and illness. Working hours are not to exceed the maximum set by local law. Further, a workweek should not be more than 60 hours per week, including overtime, except in emergency or unusual situations. All overtime must be voluntary.

Workers shall be allowed at least one day off every seven days.

4. Wages and Benefits
Compensation paid to workers shall comply with all applicable wage laws, including those relating to minimum wages, overtime hours and legally mandated benefits. In compliance with local laws, workers shall be compensated for overtime at pay rates greater than regular hourly rates. Deductions from wages as a disciplinary measure shall not be permitted. For each pay period, workers shall be provided with a timely and understandable wage statement that includes sufficient information to verify accurate compensation for work performed. All use of temporary, dispatch and outsourced labor will be within the limits of the local law.

5. Humane Treatment
There is to be no harsh or inhumane treatment including violence, gender-based violence, sexual harassment, sexual abuse, corporal punishment, mental or physical coercion, bullying, public shaming, or verbal abuse of workers; nor is there to be the threat of any such treatment. Disciplinary policies and procedures in support of these requirements shall be clearly defined and communicated to workers.

6. Non-Discrimination/Non-Harassment
Suppliers should be committed to a workplace free of harassment and unlawful discrimination. Companies shall not engage in discrimination or harassment based on race, color, age, gender, sexual orientation, gender identity and expression, ethnicity or national origin, disability, pregnancy, religion, political affiliation, union membership, covered veteran status, protected genetic information or marital status in hiring and employment practices such as wages, promotions, rewards, and access to training. Workers shall be provided with reasonable accommodation for religious practices. In addition, workers or potential workers should not be subjected to medical tests that could be used in a discriminatory way or otherwise in violation of applicable law. This was drafted in consideration of ILO Discrimination (Employment and Occupation) Convention (No.111).

7. Freedom of Association
In conformance with local law, Suppliers shall respect the right of all workers to form and join trade unions of their own choosing, to bargain collectively, and to engage in peaceful assembly as well as respect the right of workers to refrain from such activities. Workers and/or their representatives shall be able to openly communicate and share ideas and concerns with management regarding working conditions and management practices without fear of discrimination, reprisal, intimidation, or harassment.

Exhibit G - 3

8. Restricted Jurisdictions
Supplier shall not manufacture or produce products in the Xinjiang Uyghur Autonomous Region of China, or knowingly procure goods and services mined, produced or manufactured in the same.

Exhibit H - 1

EXHIBIT H
Force Majeure and/or Development Cure Period Claim Form Instructions
A. Please review Article 10 and Exhibit B (if applicable) of the Power Purchase Agreement prior to filling out the form.

B. Fill out the form completely and return to your assigned Contract Manager at CPA.

Seller: [Name] Project: [Name]
Current Guaranteed Construction Start Date: [Date]
New Guaranteed Construction Start Date (if Seller’s claims are validated in full): [Date] Guaranteed Commercial Operation Date: [Date]
New Guaranteed Commercial Operation Date (if Seller’s claims are validated in full):
[Date]

1. Please describe the claimed Force Majeure Event or other event giving rise to the claimed Development Cure Period delay(s) (the “Claimed Event”), including its cause, date of commencement and date it ended or is anticipated to end.

2. Please specify the extent of the delay or prevented performance caused by the Claimed Event, including the relief claimed thereby. Describe how the claimed relief was calculated/determined, accounting for individual developments causing such delay or prevented performance.

3. With respect to a Claimed Event other than a Force Majeure Event, please describe the commercially reasonable efforts taken by Seller to prevent such event.

4. Please describe the commercially reasonable efforts taken to mitigate the delays or nonperformance caused by the Claimed Event and specify how such efforts reduced the

Exhibit H - 2
delay days or nonperformance that would otherwise have occurred absent such mitigation.

5. Please attach supporting documentation, including without limitation:
• Force Majeure notices or other correspondence received from suppliers and/or contractors that describe the basis for and extent of the Claimed Event. • Documentation, contracts, and/or correspondence with suppliers and/or contractors evidencing the claiming Party’s mitigation efforts.
• Project schedule and/or GANTT charts that demonstrate the effect of the Claimed Event on the Guaranteed commercial Operation Date.

By signing this Claim form, I attest and affirm that I am authorized to sign this form on behalf of the Seller, that I have reviewed this Claim, including any attached documentation, and that the facts and statements made in this Claim are true and correct to the best of my knowledge.

Signed:

Name:

Title:

Date:

Exhibit I - 1

EXHIBIT I

FORM OF LETTER OF CREDIT
[Issuing Bank Letterhead and Address]
IRREVOCABLE STANDBY LETTER OF CREDIT NO. [XXXXXXX]
Date:

Bank Ref.:

Amount: US$[XXXXXXXX]

Beneficiary:

Clean Power Alliance of Southern California,
a California joint powers authority
801 S Grand, Suite 400
Los Angeles, CA 90017

Ladies and Gentlemen:

By the order of __________ (“Applicant”), we, [insert bank name and address] (“Issuer”) hereby issue our Irrevocable Standby Letter of Credit No. [XXXXXXX] (the “Letter of Credit”) in favor of Clean Power Alliance of Southern California, a California joint powers authority (“Beneficiary”), 801 S Grand, Suite 400, Los Angeles, CA 90017, for an amount not to exceed the aggregate sum of U.S. $[XXXXXX] (United States Dollars [XXXXX] and 00/100) (the “Available Amount”), pursuant to that certain Renewable Power Purchase Agreement dated as of ______ and as amended (the “Agreement”) between Applicant and Beneficiary. This Letter of Credit shall become effective immediately and shall be of no further force or effect at 5:00 p.m., California time, on [Date] or, if such day is not a Business Day (as hereinafter defined), on the next Business Day (as may be extended pursuant to the terms of this Letter of Credit, the “Expiration Date”).

For the purposes hereof, “Business Day” shall mean any day on which commercial banks are not authorized or required to close in Los Angeles, California.

Funds under this Letter of Credit are available to Beneficiary by valid presentation on or before 5:00 p.m. California time, on or before the Expiration Date of a copy of this Letter of Credit No. [XXXXXXX] and all amendments accompanied by Beneficiary’s dated statement purportedly signed by Beneficiary’s duly authorized representative, in the form attached hereto as Exhibit A, containing one of the two alternative paragraphs set forth in paragraph 2 therein.

Any full or partial drawing hereunder may be requested by transmitting copies of the requisite documents as described above to the Issuer by facsimile at [facsimile number for draws] or such other number as specified from time-to-time by the Issuer. The facsimile transmittal shall be deemed delivered when received. Drawings made by facsimile transmittal are deemed to be the operative instrument without the need of originally signed documents.

Exhibit I - 2
Issuer hereby agrees that all drafts drawn under and in compliance with the terms of this Letter of Credit will be duly honored if presented to the Issuer before the Expiration Date. All correspondence and any drawings (other than those made by facsimile) hereunder are to be directed to [Issuer address/contact]. Issuer undertakes to make payment to Beneficiary under this Standby Letter of Credit within three (3) business days of receipt by Issuer of a properly presented Drawing Certificate. The Beneficiary shall receive payment from Issuer by wire transfer to the bank account of the Beneficiary designated in the Drawing Certificate.

Partial draws are permitted under this Letter of Credit, and this Letter of Credit shall remain in full force and effect with respect to any continuing balance; provided, the Available Amount shall be reduced by the amount of each such drawing.

It is a condition of this Letter of Credit that it shall be deemed automatically extended without an amendment for a one year period (or, if such period ends on a day that is not a Business Day, until the next Business Day thereafter) beginning on the present Expiration Date hereof and upon each anniversary for such date (or, if such period ends on a day that is not a Business Day, until the next Business Day thereafter), unless at least one hundred twenty (120) days prior to any such Expiration Date Issuer has sent Beneficiary written notice by overnight courier service at the address provided below that Issuer elects not to extend this Letter of Credit, in which case it will expire on its then-current Expiration Date. No presentation made under this Letter of Credit after such Expiration Date will be honored.

Notwithstanding any reference in this Letter of Credit to any other documents, instruments or agreements, this Letter of Credit contains the entire agreement between Beneficiary and Issuer relating to the obligations of Issuer hereunder.

Except so far as otherwise stated, this Letter of Credit is subject to the International Standby Practices ISP98 (also known as ICC Publication No. 590), or revision currently in effect (the “ISP”). As to matters not covered by the ISP, the laws of the State of California, without regard to the principles of conflicts of laws thereunder, shall govern all matters with respect to this Letter of Credit.

Please address all correspondence regarding this Letter of Credit to the attention of the Letter of Credit Department at [insert bank address information], referring specifically to Issuer’s Letter of Credit No. [XXXXXXX]. For telephone assistance, please contact Issuer’s Standby Letter of Credit Department at [XXX-XXX-XXXX] and have this Letter of Credit available.

All notices to Beneficiary shall be in writing and are required to be sent by certified letter, overnight courier, or delivered in person to: Clean Power Alliance of Southern California, a California joint powers authority, Chief Financial Officer, 801 S Grand, Suite 400, Los Angeles, CA 90017. Only notices to Beneficiary meeting the requirements of this paragraph shall be considered valid. Any notice to Beneficiary which is not in accordance with this paragraph shall be void and of no force or effect.
[Bank Name]

Exhibit I - 3
___________________________
[Insert officer name]
[Insert officer title]

Exhibit I - 4

EXHIBIT A
(DRAW REQUEST SHOULD BE ON BENEFICIARY’S LETTERHEAD)
Drawing Certificate
[Insert Bank Name and Address]
Ladies and Gentlemen:

The undersigned, a duly authorized representative of [ ], [ADDRESS], as beneficiary (the “Beneficiary”) of the Irrevocable Letter of Credit No. [XXXXXXX] (the “Letter of Credit”) issued by [insert bank name] (the “Bank”) by order of __________ (the “Applicant”), hereby certifies to the Bank as follows:

1. Applicant and Beneficiary are party to that certain Renewable Power Purchase Agreement dated as of ___________, 20__ (the “Agreement”).

2. Beneficiary is making a drawing under this Letter of Credit in the amount of U.S. $___________ because a Seller Event of Default (as such term is defined in the Agreement) has occurred.
or
Beneficiary is making a drawing under this Letter of Credit in the amount of U.S. $___________, which equals the full available amount under the Letter of Credit, because Applicant is required to maintain the Letter of Credit in force and effect beyond the expiration date of the Letter of Credit but has failed to provide Beneficiary with a replacement Letter of Credit or other acceptable instrument within thirty (30) days prior to such expiration date.

3. The undersigned is a duly authorized representative of [ ] and is authorized to execute and deliver this Drawing Certificate on behalf of Beneficiary.

You are hereby directed to make payment of the requested amount to [ ] by wire transfer in immediately available funds to the following account:
[Specify account information]
[ ]
_______________________________
Name and Title of Authorized Representative
Date___________________________

Exhibit J - 1

EXHIBIT J

MATERIAL PERMITS
No. Permits
1 Conditional Use Permit
2 Fire Alarm Permit

2 Product, Delivery Period, Contract Quantity, Contract Price and other specifics of the Product are described on page 1 of this Confirmation and in Appendix B. Appendices A, B, and C are incorporated into this Confirmation.
☐ Firm RA Product:

Seller shall provide Buyer with the Product from the Unit in the amount of the Contract Quantity.

If the Unit is not available to provide the full amount of the Contract Quantity for any reason, then Seller shall have the option to supply Alternate Capacity pursuant to Section 2.3 to fulfill the remainder of the Contract Quantity during such period. If Seller fails to provide Buyer with the Contract Quantity and has failed to supply Alternate Capacity to fulfill the remainder of the Contract Quantity during such period, then Seller shall be liable for damages and/or required to indemnify Buyer for penalties or fines pursuant to the terms of Section 2.5. ☒ Contingent Firm RA Product:

Seller shall provide Buyer with the Product from the Unit in the amount of the Contract Quantity.

If the Unit is not available to provide the full amount of the Contract Quantity as a result of any reduction or unavailability of the Contract Quantity of the Unit in accordance with Section 2.2, Seller shall have the option to notify Buyer that either (a) Seller will not provide the portion of the Contract Quantity attributable to such reduction or unavailability thereof and Seller shall be excused from delivering such Contract Quantity during the period of the reduction or non-availability; or (b) Seller will supply Alternate Capacity to fulfill the remainder of the Contract Quantity during such period pursuant to Section 2.3. If the Unit is not available to provide the full amount of the Contract Quantity as a result of any reason other than as provided in Section 2.2, then Seller shall have the option to supply Alternate Capacity pursuant to Section 2.3 to fulfill the remainder of the Contract Quantity during such period. If Seller fails to provide Buyer with the Contract Quantity from the Unit without being excused therefrom as provided in Section 2.2, and has failed to supply Alternate Capacity to fulfill the remainder of the Contract Quantity during such period, then Seller shall be liable for damages and/or required to indemnify Buyer for penalties or fines pursuant to the terms of Section 2.5.

ARTICLE 2

DELIVERY OBLIGATIONS AND ADJUSTMENTS

2.1 Sale and Delivery of Product
(a) For each Showing Month of the Delivery Period, Seller shall sell and deliver to Buyer, and Buyer shall purchase and receive from Seller, the Expected Contract Quantity of the Product from the Shown Unit(s).
(b) Seller shall deliver the Expected Contract Quantity by submitting to CAISO in its Supply Plan the Shown Unit(s) and the characteristics of the Shown Unit(s) and Product for Buyer, as further specified in Appendix B, all in compliance with this Confirmation.

3 (c) Seller shall cause all Supply Plans to meet and be filed in conformance with the requirements of the CPUC and the Tariff. Seller shall submit, or cause the Shown Unit’s SC to submit, on a timely basis with respect to each applicable Showing Month, Supply Plans in accordance with the Tariff and CPUC requirements to identify and confirm the Product delivered to Buyer for each Showing Month of the Delivery Period. The total amount of Product identified and confirmed for each day of such Showing Month shall equal the Expected Contract Quantity. (d) Seller may sell and deliver Product from a Shown Unit that meets the requirements set forth in Appendix B. In no event shall a Shown Unit utilize coal or coal materials as a source of fuel or be a nuclear generating facility. A Shown Unit must be a specific resource that is connected directly to the CAISO controlled grid or be under the operational control of CAISO. A Shown Unit may not be an unspecified import. Seller shall identify the Shown Unit(s) and Expected Contract Quantity by providing Buyer with the specific information contemplated in Appendix B no later than the Notification Deadline for the relevant Showing Month. (e) By no later than fifteen (15) Business Days prior to the Showing Year Deadline for the following calendar year, Seller will provide Buyer with the expected Planned Outage schedule for the following year.
(f) If CAISO rejects either the Supply Plan or the Resource Adequacy Plan with respect to any part of the Expected Contract Quantity for the Shown Unit(s) in any Showing Month, the Parties shall confer, make such corrections as are necessary for acceptance, and resubmit the corrected Supply Plan or Resource Adequacy Plan for validation before the applicable deadline for the Showing Month. (g) The Product is delivered and received when the CIRA Tool shows that the Supply Plan submitted in compliance with Buyer’s instructions, including Buyer’s instructions to withhold all or part of the Expected Contract Quantity from Seller’s Supply Plan for any Showing Month during the Delivery Period, has been accepted for the Product from the Shown Unit(s) by CAISO. Seller has failed to deliver the Product if (i) Buyer has elected to submit the Product from the Shown Unit(s) in its Resource Adequacy Plan and such submission is accepted by the CPUC and the CAISO but the Supply Plan and Resource Adequacy Plan are not matched in the CIRA Tool and are rejected by CAISO notwithstanding performance of Section

2.1(f) or (ii) Seller fails to submit the volume of Expected Contract Quantity for any Showing Month in such amount as instructed by Buyer for the applicable Showing Month. Seller shall not have failed to deliver the Expected Contract Quantity if Buyer fails or chooses not to submit the Shown Unit(s) and the Product in its Resource Adequacy Plan with the CPUC or CAISO.
(h) The Shown Unit(s) must not have characteristics that would trigger the need for Buyer or Seller to file an advice letter or other request for authorization with the CPUC.

4 2.2 Adjustments to ContractQuantity
If during any period the Unit described in Appendix B is not available to provide the full amount of the Contract Quantity as a result of the reduction in the Unit EFC or Unit NQC of such Unit (other than as a result of a Planned Outage), or due to Force Majeure, then (i) Seller shall notify Buyer by the Notification Deadline of the amount, if any, of the Contract Quantity that Seller will not sell and deliver during such period (taking into account any portion of the Contract Quantity of Product delivered from a Replacement Unitin accordance with Section 2.3), and
(ii) Seller will be excused from providing such Contract Quantity of the Product and will not be liable to Buyer for damages or penalties for the failure to deliver such portion of the Contract Quantity;
provided, that
(I) if there is a reduction in the aggregate Unit NQC in an amount equal to ten percent (10%) or more of the Contract Quantity (exclusive of any reduction attributable to an issue that affects gas-fired generation generally (such as ambient derates)) (the “Reduced NQC”) that continues for two (2) years from the first day of the first Showing Month in which such reduction is effective (such initial date, the “Reduction Commencement Date” and such two (2) year period, the “Reduced NQC Period”) and
(II) Seller does not offer on or before the end of the one (1) year period commencing on the Reduction Commencement Date (the “Reduced NQC Notice Period”) to replace 100% of the Reduced NQC by dedicating additional Product from Replacement Units to be sold to Buyer upon the terms and conditions set forth herein for the period commencing no later than the end of the Reduced NQC Period and continuing for the remainder of the Delivery Period, then Buyer shall have a right to terminate this Confirmation by providing written notice to Seller no later than the end of the sixty (60)-day period commencing upon the earlier of
(a) the conclusion of the Reduced NQC Notice Period and (b) the date upon which Seller provides written notice to Buyer that it is electing not to replace such Reduced NQC.

Any such termination pursuant to this Section 2.2 shall be effective on the first day after the Reduced NQC Period; provided, that if as of such date the Reduced NQC is no longer effective because of an increase in the Unit NQC, then such termination shall not be effective, and Buyer shall have the right to terminate this Confirmation following any future Reduced NQC event pursuant to this Section 2.2.

5 Upon any termination pursuant to this Section 2.2, neither Party shall have any further liability to the other Party hereunder (other than any liabilities that arose prior to the date of such termination), and Seller shall be entitled to a refund of the credit support provided to Buyer pursuant to Section 6.1 (subject only to the payment of any liabilities that arose prior to the date of such termination); provided further, that
(A) if Buyer has the right to terminate this Confirmation in accordance with this Section 2.2 and does not provide timely written notice as required of its election to do so, or
(B) if Seller offers to replace the reduced Unit NQC in accordance with this Section 2.2 and Buyer does not accept such offer
then, in either case, Buyer shall be deemed to have irrevocably waived its rights to terminate this Confirmation in accordance with this Section 2.2 in the future.

In the case of reduction in the Unit EFC or Unit NQC, such reduction shall be calculated in accordance with the following formulas:

In the case of reduction in the Unit EFC:

Amount of reduction in the Unit EFC * Prorated Percentage of Unit Flexible Factor In the case of reduction in the Unit NQC:

Amount of reduction in the Unit NQC * Prorated Percentage of Unit Factor Without limiting the foregoing, in the event Seller is unable to provide the Contract Quantity for any portion of a Showing Month for any reason, Seller has the option, but not the obligation, to provide Product for such portions of such Showing Month from Replacement Units, provided Seller provides and identifiessuch Replacement Unitsin accordance with Section 2.3.

2.3 Seller’s Option To Provide Alternate Capacity
If Seller is unable to provide the full Contract Quantity for each day of each Showing Month for any reason, including, without limitation, as provided in Section 2.2, or Seller desires to provide some or all of the Contract Quantity for any day of a Showing Month from a different generating unit other than the Unit, then Seller may, at its sole option and without obligation, at the Contract Price, provide Buyer with replacement Product from one or more Replacement Units in an amount such that the total amount of Product provided to Buyer from the Unit and any Replacement Unit(s) for each day of the Showing Month is not more than the Contract Quantity, provided that in each case:
(a) Seller shall notify Buyer in writing of its intent to provide Alternate Capacity and shall identify the Replacement Unit(s) from which such Alternate Capacity shall be provided before the Notification Deadline for such Showing Month; and

7 2.6 Buyer’s Re-Sale of Product
(a) Buyer may re-sell all or part of the Product; provided that any such re-sale must not increase Seller’s obligations hereunder other than as set forth in this Section 2.6(a).

For any such a resale, the Resource Adequacy Plan of Buyer as used herein will refer to the Resource Adequacy Plan of Subsequent Buyer. Seller shall, or shall cause the Shown Unit’s SC, to follow Buyer’sinstructions with respect to providing such resold Product to Subsequent Buyers, to the extent such instructions are consistent with Seller’s obligations under this Confirmation. Seller shall, and shall cause the Shown Unit’s SC, to take all commercially reasonable actions and execute all documents or instruments reasonably necessary to allow such Subsequent Buyers to use such resold Product in a manner consistent with Buyer’s rights under this Confirmation. If Buyer incurs any liability to a Subsequent Buyer due to the failure of Seller or the Shown Unit’s SC to comply with this Confirmation, Seller shall be liable to Buyer for the amounts Seller would have owed Buyer under this Confirmation if Buyer had not resold the Product.
(b) Buyer shall notify Seller in writing of any resale of Product and the Subsequent Buyer no later than two (2) Business Days before the Notification Deadline for each Showing Month for which Buyer has resold Product. Buyer shall notify Seller of any subsequent changes or further resales no later than two (2) Business Days before the Notification Deadline for the Showing Month. (c) If CAISO or CPUC develops a centralized capacity market, Seller shall not offer, bid, or otherwise submit the Expected Contract Quantity for re-sale to any person or entity other than Buyer or Buyer’s designee into such market, and Seller and the Unit’s SC shall comply with the Buyer’s direction and Buyer shall retain and receive all revenues from such re-sale.

ARTICLE 3

PAYMENTS

3.1 Payment
Buyer shall pay for the Product as provided in Article Six of the Master Agreement and this Confirmation. Buyer shall make a monthly payment to Seller for each Unit by the later of (i) ten (10) Business Days after Buyer’s receipt of Seller’s invoice (which may be given upon first day of the Showing Month) and (ii) the twentieth (20th) of the Showing Month, or if the twentieth (20th) is not a Business Day the next following Business Day (“Monthly RA Capacity Payment”). The Monthly RA Capacity Payment shall equal the product of (a) the applicable Contract Price for the relevant Showing Month, (b) the Expected Contract Quantity for the Showing Month, and (c) 1,000, rounded to the nearest penny (i.e., two decimal places); provided, however, that the Monthly RA Capacity Payment shall be adjusted to reflect any portion of Expected Contract Quantity for the Showing Month that was not delivered in accordance with Section 2.1 for such Showing Month. If there is a change in applicable law that prevents Buyer from using the Unit EFC or Unit NQC for its Compliance Showings as a result of the Contract Quantity being subject to a Forced Outage, then the Monthly RA Capacity Payment for such Showing Month shall be

8 adjusted to reflect any portion of the Expected Contract Quantity that was not delivered unless Seller provides Product for such portions of such Showing Month from Replacement Units in accordance with the last paragraph of Section 2.2.

3.2 Allocation of Other Payments and Costs
(a) Seller shall receive any revenues from, and must pay all costs charged by, CAISO or any other third party with respect to the Shown Unit(s) for (i) start-up, shutdown, and minimum load costs, (ii) capacity for ancillary services, (iii) energy sales, (iv) flexible ramping product, or (v) black start or reactive power services. Buyer must promptly report receipt of any such revenues to Seller. Buyer must pay to Seller any such amounts described in this Section 3.2(a) received by Buyer or a Subsequent Buyer. Without prejudice to its other rights and remedies, Seller may setoff and recoup any such amounts that are not paid to it pursuant to this Section

3.2(a) against any amounts owed to Buyer under the Master Agreement. (b) Buyer is to receive and retain all revenues associated with the Expected Contract Quantity of Product during the Delivery Period, including any capacity and availability revenues from the Capacity Procurement Mechanism, or its successor, RUC Availability Payments, or its successor, but excluding payments described in Section 3.2(a)(i)-(v) or 3.2(c). Seller shall promptly report receipt of any such revenues to Buyer. Seller shall pay to Buyer within thirty (30) days of receipt any such amounts received by Seller, or a Shown Unit’s SC, owner, or operator.

Without prejudice to its other rights, Buyer may set off and recoup any such amounts that are not paid to it against amounts owed to Seller under the Master Agreement.
(c) Any Availability Incentive Payments or Non-Availability Charges are for Seller to receive and pay.

ARTICLE 4

OTHER BUYER AND SELLER COVENANTS

4.1 CAISO Requirements
Seller shall schedule or cause the Shown Unit’s SC to schedule or make available to CAISO the Expected Contract Quantity of the Product during the Delivery Period, in compliance with the Tariff, and perform all, or cause the Shown Unit’s SC, owner, or operator to perform all, obligations under applicable law and the Tariff relating to the Product. Buyer is not liable for, and Seller shall indemnify and hold Buyer harmless from, the failure of Seller or the Shown Unit’s SC, owner, or operator to comply with the Tariff, and for any penalties, fines or costs imposed on Seller or the Shown Unit’s SC, owner, or operator for noncompliance.

4.2 Seller’s and Buyer’s Duties to Take Actions to Allow Product Utilization Throughout the Delivery Period, Buyer and Seller shall take all commercially reasonable actions and execute all documents or instruments reasonably necessary to ensure (a) Buyer’s rights to the

9 Expected Contract Quantity for the sole benefit of Buyer or any Subsequent Buyer, and (b) that Buyer may use the Expected Contract Quantity to meet its Compliance Obligations. Such commercially reasonable actions shall include, without limitation, cooperating with and providing, and causing each Shown Unit’s SC, owner, or operator to cooperate with and provide, requested and supporting documentation to the CAISO, the CPUC, or any other Governmental Body responsible for administering the applicable Compliance Obligations, including to demonstrate that the Expected Contract Quantity can be delivered to the CAISO controlled grid for the minimum hours required to satisfy the Compliance Obligations, as applicable, pursuant to the “deliverability” standards established by the CAISO or other Governmental Body of competent jurisdiction.

If necessary, the Parties further agree to negotiate in good faith to amend this Confirmation to conform this Transaction to subsequent clarifications, revisions, or decisions rendered by CAISO or an applicable Governmental Body to maintain the benefits of the Transaction.

4.3 Seller’s Representations and Warranties
Seller represents and warrants to Buyer throughout the Delivery Period that:
(a) No part of the Contract Quantity during the Delivery Period has been committed by Seller to any third party to satisfy Compliance Obligations or analogous obligations in any CAISO or non-CAISO markets;
(b) The Shown Unit(s) qualify to provide the Product under the Tariff, and the Shown Unit(s) and Seller are capable of delivering the Product; (c) The aggregation of all amounts of Capacity Attributes that Seller has sold, assigned, or transferred for the Shown Unit(s) during the Delivery Period does not exceed the Shown Unit’s Net Qualifying Capacity and, if applicable, the Effective Flexible Capacity for the Shown Unit(s);
(d) If applicable, Seller has notified either the Shown Unit’s SC or the entity from which Seller purchased the Product that Seller has transferred the Contract Quantity of Product for the Delivery Period to Buyer; and
(e) Seller has notified or will notify the Shown Unit’s SC that Buyer is entitled to the revenues set forth in Section 3.2(b), and such Shown Unit’s SC is obligated to promptly deliver those revenues to Buyer, along with appropriate documentation supporting the amount of those revenues.

4.4 Market Based Rate Authority
Upon Buyer’s written request, Seller shall, in accordance with FERC Order No. 697, submit a letter of concurrence in support of any affirmative statement by Buyer that this contractual arrangement does not transfer “ownership or control of generation capacity” from Seller to Buyer as the term “ownership or control of generation capacity” is used in 18 CFR Section 35.42. Seller

11 5.3 Dodd-Frank Act
The Parties intend this Transaction to be a “customary commercial arrangement” as described in Section II.A.1 of Commodity Futures Trading Commission, Proposed Guidance, Certain Natural Gas and Electric Power Contracts, 81 Fed. Reg. 20583 at 20586 (Apr. 8, 2016) and a “Forward Capacity Transaction” within the meaning of Commodity Futures Trading Commission, Final Order in Response to a Petition From Certain Independent System Operators and Regional Transmission Organizations To Exempt Specified Transactions Authorized by a Tariff or Protocol Approved by the Federal Energy Regulatory Commission, 78 Fed. Reg. 19,880 (Apr. 2, 2013).

5.4 Change in Law

If any action by the CPUC, CAISO or any Governmental Body having jurisdiction results in any change in applicable law occurring after the Confirmation Effective Date that (i) materially changes Buyer’s or Seller’s obligations with regard to the Products sold hereunder, (ii) has the effect of changing the transfer and sale procedure set forth in this Confirmation so that the performance of this Confirmation becomes impracticable, or (iii) changes the requirements for Resource Adequacy Requirements such that the Product can no longer be counted towards Buyer’s Resource Adequacy Requirements (a “Change in Law”), the Parties shall work in good faith, without being obligated, to revise this Confirmation so that the Parties can perform their obligations regarding the purchase and sale of the Product sold hereunder in order to maintain the original intent.

5.5 Governing Law
This Confirmation, including the provisions and requirements of the Tariff and the definition of the Product and its components, and any portion of the Master Agreement applicable to this Transaction shall be governed by and construed in accordance with the laws of the State of California, without regard to the conflicts of laws rules thereof.

Nothing contained in this Confirmation shall be construed as a grant of CPUC jurisdiction over a Party not otherwise subject to such jurisdiction by law.

5.6 Intentionally Omitted

5.7 Counterparts
This Confirmation may be signed in any number of counterparts with the same effect as if the signatures to the counterparts were upon a single instrument. The Parties may rely on electronic, facsimile or scanned signatures as originals under this Confirmation. Delivery of an executed signature page of this Confirmation by facsimile or electronic mail transmission (including PDF) shall be the same as delivery of a manually executed signature page.

5.8 Entire Agreement; No Oral Agreements or Modifications This Confirmation sets forth the terms of the Transaction into which the Parties have entered and shall constitute the entire agreement between the Parties relating to the contemplated purchase and sale of the Product. Notwithstanding any other provision of the Agreement to the contrary, this

DB2/ 46968344.30 Appendix A - 1

APPENDIX A

DEFINED TERMS
“Alternate Capacity” means replacement Product which Seller has elected to provide to Buyer in accordance with the terms of Section 2.3.
“Annual Supply Plan” has the meaning set forth in the CAISO Tariff. “CAISO” means the California ISO or the successor organization to the functions thereof. “Capacity Attributes” means attributes of the Shown Unit that may be counted toward Compliance Obligations, including: flexibility, dispatchability, physical location or point of electrical interconnection of the Shown Unit; Unit ability to generate at a given capacity level, provide ancillary services, or ramp up or down at a given rate; any current or future defined characteristics, certificates, tags, credits, or accounting constructs of the Shown Unit, howsoever entitled, identified from time to time by the CAISO or a Governmental Body having jurisdiction over Compliance Obligations.
“CIRA Tool” means the CAISO Customer Interface for Resource Adequacy. “Compliance Obligations” means, as applicable, RAR, Local RAR and FCR. “Compliance Showings” means the applicable LSE’s compliance with the Resource Adequacy Requirements of the CPUC for an applicable Showing Month. “Contingent Firm RA Product” has the meaning set forth in Article 1 herein. “CPUC Decisions” means any currently effective or future decisions, resolutions, or rulings related to the Resource Adequacy Requirements.
“CPUC Filing Guide” is the document issued annually by the CPUC which sets forth the guidelines, requirements and instructions for load serving entities to demonstrate compliance with the CPUC’s resource adequacy program.
“Credit Watch” means the S&P or Moody's ratings outlook, i.e., “Watch Negative”, “Possible Downgrade” “Review for Downgrade”, “Review for Possible Downgrade” or other similar terminology.
“Effective Flexible Capacity” has the meaning given in the CAISO Tariff. “Environmental Costs” means (i) costs incurred in connection with acquiring and maintaining all environmental permits and licenses for the Product, (ii) the Product’s compliance with all applicable environmental laws, rules, and regulations, including capital costs for pollution mitigation or installation of emissions control equipment required to permit or license the Product, (iii) all operating and maintenance costs for operation of pollution mitigation or control equipment, (iv) costs of permit maintenance fees and emission fees as applicable, (v) the costs of all emission reductions that have been authorized by a local air pollution control district or emissions trading credits or units pursuant to the California Health & Safety Code, market based incentive programs such as the South Coast Air Quality Management District’s Regional Clean Air Incentives Market,

DB2/ 46968344.30 Appendix A - 2
authorizations to emit sulfur dioxide and oxides of nitrogen by the Environmental Protection Agency, and any costs related to greenhouse gas emissions required by any applicable environmental laws, rules, regulations, or permits to operate, and (vi) costs associated with the disposal, clean-up, decontamination or remediation, on or off site, of hazardous substances. “Expected Contract Quantity” means,with respect to any particular day of any Showing Month of the Delivery Period, (a) for Firm RA Product, the Contract Quantity of Product, including the amount of Contract Quantity of Product that Seller has elected to provide Alternate Capacity with respect to such day, and (b) for Contingent Firm RA Product, the Contract Quantity of Product for such Showing Month, including the amount of Contract Quantity of Product that Seller has elected to provide Alternate Capacity with respect to such day, less any reductions to Contract Quantity for such day consistent with the definition of Contingent Firm RA Product and Section

2.2 with respect to which Seller has not elected to provide Alternate Capacity. “Firm RA Product” has the meaning set forth in Article 1 herein. “Flexible Capacity” or “FCR” means the flexible capacity requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, the CAISO pursuant to the Tariff, or other Governmental Body having jurisdiction over Compliance Obligations and includes any non-binding advisory showing which an LSE is required to make with respect to flexible capacity. “Governmental Body” means any federal, state, local, municipal or other government; any governmental, regulatory or administrative agency, commission or other authority lawfully exercising or entitled to exercise any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power; and any court or governmental tribunal. “Local RAR” means the local Resource Adequacy Requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, by CAISO pursuant to the Tariff, or by any other Governmental Body having jurisdiction over Compliance Obligations. “LSE” means “Load Serving Entity” as such term is used in Section 40.9 of the Tariff. “MW” means megawatt.
“Net Qualifying Capacity” has the meaning given in the CAISO Tariff. “Notification Deadline” is twenty (20) Business Days before the relevant deadlines for the corresponding Compliance Showings applicable to the relevant Showing Month. “PlannedOutage” means, subject to and as further described in the CPUC Decisions, a CAISO-approved, planned or scheduled disconnection, separation or reduction in capacity of the Unit that is conducted for the purposes of carrying out routine repair or maintenance of such Unit, or for the purposes of new construction work for such Unit. “Product” means RAR, Local RAR and/or FCR for the Delivery Period, Unit, Contract Quantity, Contract Price and other specifications described on page 1 of this Confirmation and contained in Appendix B.
“Prorated Percentage of Unit Factor” means the percentage, as specified in Appendix B, of the Unit NQC as of the Effective Date that is dedicated to Buyer under this Transaction.

DB2/ 46968344.30 Appendix A - 3
“Prorated Percentage of Unit Flexible Factor” means the percentage, as specified in Appendix B, of the Unit EFC as of the Effective Date that is dedicated to Buyer under this Transaction. “Prudent Operating Practice” means (a) the applicable practices, methods and acts required by or consistent with applicable laws and reliability criteria, and otherwise engaged in or approved by a significant portion of the electric power industry during the relevant time period in the Western United States, or (b) any of the practices, methods and acts which, in the exercise of reasonable judgment in light of the facts known at the time the decision was made, could have been expected to accomplish the desired result at a reasonable cost consistent with good business practices, reliability, safety and expedition. Prudent Operating Practice is not intended to be limited to the optimum practice, method or act to the exclusion of all others, but rather to acceptable practices, methods or acts generally accepted in the electric power industry in the Western United States. “Reduced NQC” has the meaning set forth in Section 2.2 herein. “Reduced NQC Notice Period” has the meaning set forth in Section 2.2 herein. “Reduced NQC Period” has the meaning set forth in Section 2.2 herein. “Reduction Commencement Date” has the meaning set forth in Section 2.2 herein. “Replacement Unit” means a generating unit meeting the requirements specified in Section 2.3. “Resource Adequacy Requirements” or “RAR” means the resource adequacy requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, by CAISO pursuant to the Tariff, or by any other Governmental Body having jurisdiction over Compliance Obligations. “Resource Category” shall be as described in the annual CPUC Filing Guide, as such may be modified, amended, supplemented or updated from time to time. “SC” means Scheduling Coordinator as defined in the Tariff. “Showing Month” means the calendar month of the Delivery Period that is the subject of the related Compliance Showing.
“Showing Year Deadline” means the annual deadline for LSE’s to submit Annual Supply Plans to the CAISO.
“Shown Unit” means the Unit, or any Replacement Unit meeting the requirements of Section 2.3 of this Confirmation and specified by Seller in a Supply Plan, but not necessarily identified by Seller to Buyer on the Effective Date.
“Subsequent Buyer” means the Buyer of Product from Buyer in a re-sale of Product by Buyer. “Tariff” means the CAISO Tariff, including any current CAISO-published “Operating Procedures” and “Business Practice Manuals,” in each case as amended or supplemented from time to time.
“Unit” means the generation unit described in Appendix B. A Unit may not be a nuclear or coal-fired generating facility.

DB2/ 46968344.30 Appendix A - 4
“Unit EFC” means the lesser of the Unit’s Effective Flexible Capacity as set by CAISO as of the Effective Date and that of the Unit on a subsequent date of determination. “Unit EFC Category” shall be as described in the annual CPUC Filing Guide, as such may be modified, amended, supplemented or updated from time to time. “Unit NQC” means the lesser of the Unit’s Net Qualifying Capacity as set by CAISO as of the Effective Date and that of the Unit on a subsequent date of determination.

DB2/ 46968344.30 Appendix B - 3

Long-term Power
Contracting Update and
RA-Only Contracts
December 6, 2024

CPA’s long-term contracting efforts contributed to CPA becoming the largest supplier of renewable energy in the U.S. two years running, with thousands of MWs of renewables and storage currently under contract, and more procurement planned.

CPA’s portfolio of long-term contracts has enabled CPA to meet and, in many cases, far exceed state compliance requirements.

CPA is part of a broader CCA community making large impacts with new -build resources, including signing over 18,000 MWs collectively.

On September 25, 2024, the Energy Committee approved the 2024 Clean Energy and Reliability Request for Offers (RFO) shortlist of 6 projects and waitlist of 6 projects.

Staff has concluded negotiations for two of the shortlisted projects, Olinda and Sentinel Energy Center. Both projects are being contracted for under “RA-Only” Agreements.

Staff is requesting the Board approve and authorize the Chief Executive Officer to execute these two RA-Only Agreements.
2 Executive Summary

Project Agreement
Type Technology Capacity Contract Start Date
Contract
Length Process
Olinda RA-Only
Agreement
Four-hour
Standalone
Storage
110 MW 10/1/2027 15 years 2024 RFO
Sentinel
Energy
Center (SEC)
RA-Only
Confirmation
Natural Gas
Generator 107.52 MW 1/1/2027 10 years 2024 RFO
Action Requested
3 Approve and authorize the Chief Executive Officer to execute a 15- year RA-Only Agreement with Upstream Energy (Olinda) and a 10- year RA-Only Agreement with Sentinel Energy Center (SEC)

Agenda
CPA Long-term Contracting Update:

CPA: How did we get here?
Meeting and Exceeding Compliance
CCA Impacts
RA-Only Contracts
Action Requested
4

CPA Long-term
Contracting
Update
5

Largest Supplier of Renewable Energy in the US
How did we get here?
Years of operations: 6
Total megawatts (MWs) of renewable energy
procured under long-term contracts:
2,626 MW
Total MWs of storage procured: 1,934 MW
Total MWs of renewable projects online:
1,176 MW
Total MWs of storage online: 635 MW
Total number of active long-term contracts:
44 Number of unique counterparties: 17
CPA has projects size 0.5 to 575 MW
6 CPA Technologies by MWs

Part of a Larger Community Making Impact
CCA Impacts
There are 25 operational CCA programs in
California serving more than 14 million
customers—about one-third of the state’s
population—in 200+ cities and counties
throughout the state.

CCAs have signed 356 long-term power
purchase agreements (PPAs)
CCAs have signed PPAs for 18,285 MWs of
new-build clean energy resources (solar, wind,
geothermal, energy storage, and demand
response resources)
10,500 MW in renewable energy
7,600 MW in energy storage
116 clean energy projects totaling more than
7,900 MW are already operational
7

CPUC California Renewable Portfolio Standard (RPS)
Program: California’s RPS is a requirement for load-serving entities to progressively increase renewable energy
procurement. This is a portfolio level requirement for LSEs to procure eligible renewable resources, increasing up to 60% of load by 2030.
8 Met 2030 Target 10 Years Early
Senate Bill 100 and Senate Bill 1020: Expands RPS to
also include Carbon Free requirements. Senate Bill (SB)100 established a 100% Renewable and Carbon Free target by
2045. SB 1020 established interim targets of 90% of retail sales from Renewable or GHG-Free sources by 2035 and
95% by 2040.

Mid-Term Reliability Procurement Requirements: Under the CPUC’s Midterm Reliability procurement order, LSEs must procure a specific amount of new, incremental capacity according to a schedule of tranches, beginning in 2023 and ending in 2028.
9 CPA Midterm Reliability - Conventional Resource Position Midterm Reliability Tranche: 1 2 3 4 5
Resource must be Online By: Aug-23 Jun-24 Jun-25 Jun-26 Jun-27 CPA Compliance Requirement (MW) 118 354 89 117 117
Contracted Volume (MW) 118 354 156.7 117 615.4
CPA Compliance Position - - - - 498
CPA Midterm Reliability - Long Lead Time Position
Resources must be online by: Jun-28
CPA Compliance Requirement - Long Duration Storage (MW) 59 Contracted Volume (MW) 63
CPA Compliance Position 4
CPA Compliance Requirement – Baseload (MW) 59
Contracted Volume (MW) 47
CPA Compliance Position -12
Well Positioned for Mid-term Reliability Compliance

Resource Adequacy (RA) Program: The California Public Utilities Commission (CPUC) intends to ensure the safe and reliable operation of the grid in real-time through the RA Program, providing sufficient resources to the California Independent System Operator (CAISO) when and where needed, and to incentivize the siting and construction of new resources needed for future grid reliability.

History of CPA’s Compliance with Resource Adequacy
CPA has met every Month-Ahead RA compliance filing
CPA has met all but one Year-Ahead RA compliance filings, and the shortfall was remedied in the Month-Ahead filing.

New Slice-of-Day Resource Adequacy (RA) Program
RA transitioned from requirements based on single monthly peaks to “24-hour slices” based on the worst day in each month
The new program creates considerable more complexity
CPA met compliance for the 2025 Year Ahead Slice-of-Day filing (October 31st) 10 Meeting Resource Adequacy Requirements

11 CPA Meets Resource Adequacy Requirements
Illustrative Example of Summer 2025 Month Ahead Compliance

Planning for Future Procurement
What’s in the works for long-term procurement?
CPA has moved aggressively to secure supply under long-term contracts and is planning for the following solicitations in 2025:
2025 Clean Energy and Reliability RFO
CPA will be seeking to fill smaller volume of renewable energy compared to past years CPA will be seeking to fill larger positions for baseload Resource Adequacy 2025 Power Share RFO
CPA has been allocated additional program capacity to procure small scale projects (.5-20 MWs) to provide 100% renewable energy at a bill discount to qualifying customers 2025 New Technology RFI
Launching in January, this request for information intends to identify future procurement opportunities and assist with the development of emerging energy generation and storage technologies
12

Market Challenges and Opportunities
Challenges
Renewable Energy/Product Content Category 1
(PCC1) costs remain high, and compliance
requirements continue to increase.

Uncertainty under CPUC’s Slice of Day framework
for Resource Adequacy (RA) Compliance,
implemented in 2025
RA products may be sold and priced differently
than before, causing new market dynamics
Compliance is based on the types of
technologies procured, so availability and costs
of specific resources that are in high demand
may become more prominent.

The CAISO interconnection queue is oversubscribed
and opportunities for projects with deliverability are
scarce and increasingly have late-term online dates
(2030+)
13 $0.00
$10.00
$20.00
$30.00
$40.00
$50.00
$60.00
$70.00
$80.00
$90.00
2020 2021 2022 2023 2024 2025 2026 2027
PCC1 Market Price $/MWh

Market Challenges and Opportunities
Challenges, continued
CAISO-wide, solar has been curtailed 7% of the time over the last year and curtailment is expected to increase over time CPA has long-employed strategies to mitigate the impact of curtailment and negative pricing, including:

A diverse portfolio of non-solar renewable resources under long-term contracts which means CPA has less exposure to curtailment and negative price risk.
1,934 MW of energy storage under long-term contracts reduces curtailment on the grid by charging with low or negatively priced energy in the day and reselling it in the higher priced evening hours Curtailment risks are factored into CPA’s procurement decisions, including project valuation which allows for an apples-to-apples comparison of different resources like solar or wind, factoring in the costs of curtailment and negative pricing
Through various CPA programs, customers are encouraged to shift energy usage from peak evening hours to the middle of the day rather than the evening or night.

Opportunities
LSE’s now play a part in the interconnection process and can show interest in specific projects at an earlier stage.

Continue to work closely with regulatory bodies to influence policy where appropriate CPA has proven we are a leader in the renewable energy sector and CPA can leverage this standing in contracting and other areas.
14

RA-Only
Contracts
15

Olinda Reliability Project
110 MW* Standalone Storage Project
Products: RA-Only
Location: La Habra Heights, Los Angeles County, California New build project with October 1, 2027 online date
Developer: Upstream Energy
Term: 15 years
Rationale
Project located in CPA’s service territory and will replace an existing oil extraction facility
RA value / executed interconnection agreement and FCDS* Near term start date
* Project has FCDS for 100 MW and expecting additional deliverability for 10 MW in 2026 Project Overview
16 Criteria Rank
Value 4th Quartile
Development Score High
Workforce
Development High
Environmental
Stewardship Medium
Benefits to DACs High
Project Location High
Evaluation Summary

Olinda – Site Location
The Olinda Project will be
constructed on an
approximately 7-acre site
located in an unincorporated
portion of Los Angeles County
adjacent to the City of La Habra
Heights, CA.

The site is currently being used
for oil drilling/extraction and is
located next to an electrical
substation.
17

Sentinel 108 MW RA-Only
18 Project Overview
Sentinel Energy Center (SEC) is an existing natural-gas fired generation facility with a nameplate capacity of 850 MW
The proposed RA-Only agreement is for a 107.52 MW portion of RA provided by the facility. The agreement does not include any energy generation delivered to CPA and therefore it is not reported on CPA’s Power Content Label In March 2024, CPA executed an RA-Only agreement with Sentinel for a 212 MW portion of the same facility, under the 2023 Clean Energy RFO process Location: North of Palm Springs in Unincorporated Riverside County Contract Start Date: January 1, 2027
Seller: Sentinel Energy Center, LLC
Rationale
The project will help CPA meet its RA compliance obligations over a long-term horizon, or about 3.2% of CPA’s 2027 forecasted peak RA need RA agreements with natural gas generators are valuable under the new Slice of Day RA compliance structure
Criteria Rank
Value 2nd Quartile
Development Score High
Workforce
Development High
Environmental
Stewardship Neutral
Benefits to DACs Neutral
Project Location Medium
Evaluation Summary

RA-only Contracts
19 RA-only Contract Typical PPA
RA
RA
RECs
Energy
Energy
Historically, RA compliance has been
measured on a monthly basis. Beginning in
2025, under the Slice of Day RA framework,
LSE’s must demonstrate RA compliance in
every hour of the day in each month
Under this Slice of Day framework,
dispatchable baseload resources, such as
gas, geothermal, biomass, and nuclear are
especially valuable as they can be shown at
their full nameplate during every hour of the
day

Value of Baseload RA in Slice of Day
20 The charts show examples
of how much RA value a
sample 200 MW baseload,
solar, wind, or storage
resource would provide
under Slice of Day
framework
RA-only agreements with
baseload generators are
valuable under the new
Slice of Day RA program
because the capacity can be
shown in every hour of the
day, at the full nameplate
value of the resource,
whereas intermittent
resources count for a
smaller portion of
nameplate capacity and
only at certain times of day.
0 50
100
150
200
250
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 MW NQC
Example September Slice of Day Resource
Adequacy Showing - Baseload Resource
0 20
40 60
80 100
120
140
160
180
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Example September Slice of Day Resource
Adequacy Showing - Solar Resource
0 5
10 15
20 25
30 35
40 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 MW NQC
Hour of Day
Example September Slice of Day Resource
Adequacy Showing - Wind Resource
0 20
40 60
80 100
120
140
160
180
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Hour of Day
Example September Slice of Day Resource
Adequacy Showing - Storage Resource

Project Agreement
Type Technology Capacity Contract Start Date
Contract
Length Process
Olinda RA-Only
Agreement
Four-hour
Standalone
Storage
110 MW 10/1/2027 15 years 2024 RFO
Sentinel
Energy
Center (SEC)
RA-Only
Confirmation
Natural Gas
Generator 107.52 MW 1/1/2027 10 years 2024 RFO
Action Requested
21 CPA staff is seeking Board approval and authorization for the Chief Executive Officer to execute two RA-Only Agreements:

Olinda RA-only Agreement
SEC RA-only Agreement

Questions.

Appendix.

CPA's Evaluation Criteria
Renewable Energy and Energy Storage Projects are ranked using CPA’s traditional criteria:

Environmental
Stewardship
Workforce
Development
Quantitative
Evaluation
(Value)
Development
Risk
Project
Location
Benefits to
DACs
24

Development Risk
Projects will be ranked from high (good) to low (bad)
The development risk metric is a composite rank based on a number of factors impacting project risk:
o Site control
o Interconnection status
o Environmental screens
o Land use and permits
o Project financing
o Developer experience

Environmental Stewardship
Projects are ranked high, medium, neutral, and low based on the following prioritization:

Demonstrates multiple benefits (provides additional societal, health, economic, water saving, or environmental benefits beyond the climate and GHG reduction benefits of renewable energy)
HIGH
Located in an area designated as a preferred renewable energy zone and received required land use entitlement permits
MEDIUM
LOW Project is located in a high conflict area
NEUTRAL Project does not demonstrate either preference or avoidance criteria

Workforce Development
Projects are ranked high, medium, and low based on the following prioritization:

The project will use targeted-hire, union labor, or multi-trade project labor agreements (including requirements for state-apprenticeship graduates) HIGH The project does not have a labor agreement, but can demonstrate prevailing wage, union labor, and targeted hire commitments MEDIUM The project does not demonstrate prevailing wage, union labor, and targeted hire commitments
LOW

Benefits to Disadvantaged Communities
Projects are ranked high, medium, neutral, and low based on the following prioritization:

Located within a DAC and demonstrates DAC workforce and community development benefits HIGH
Project not located within a DAC but can demonstrate DAC benefits and has completed community outreach MEDIUM
LOW Project is inconsistent with community priorities
NEUTRAL Project does not demonstrate DAC benefits

Project Location Scoring
HIGH In Los Angeles and Ventura counties
Other counties within California
Projects located within a Federally-designated energy community or on tribal lands with demonstrated community support (including outside of California)
MEDIUM
Projects outside of California not located in a Federally-designated energy community or on tribal lands without demonstrated community support LOW

Staff Report – Agenda Item 13
To: Board of Directors
From: Dr. Monique Edwards-Greer, Chief Administrative Officer Reviewed by: Nancy Whang, General Counsel
Approved by: Ted Bardacke, Chief Executive Officer
Subject: CPA Salary Grades, Benefits, and Employee Handbook Updates Date: December 5, 2024

RECOMMENDATION
a. Approve Salary Grades for CPA Employees, as contained in Attachment 2 b. Adopt Resolution 24-12-079 (Attachment 3) approving the updates to CPA’s Employee Handbook as contained in Attachment 4
At its November 21 Meeting, the CPA Executive Committee recommended that the Board approve the above recommendations.

BACKGROUND
CPA is the fourth largest energy provider in California, delivering high levels of renewable energy and impactful programs at competitive rates by managing over $1.4 billion in annual revenue, market risk in an energy industry that is rapidly changing and subject to a complex political and regulatory environment, and billions of rows of data in numerous large datasets generated in 15-minute intervals by over one million customer accounts. It does this with a relatively small staff of specialized professionals; staffing costs in the current year, including benefits, are budgeted to be approximately 1.5% of total revenue.

CPA does not carry any long-term pension or defined-benefit retirement obligations.

To attract and retain staff, CPA mostly competes with the private sector. CPA has made significant progress in retaining and recruiting high-performing staff, even in the face of

Board of Directors Item 13
stiff labor market competition from the renewable energy industry, other CCAs, and the private sector. Over the past year, CPA has had a 4% turnover rate, compared to an approximate 15% turnover rate in the energy industry in general. Meanwhile, CPA has 87 allocated positions and 5 vacancies, a vacancy rate of approximately 6%. CPA has experienced only 3 voluntary departures over the past two years and no turnover in its Executive and Senior Leadership during that time.

Staff attributes this success to the support received from the Board to pay competitive salaries and benefits, approval of the Executive/Management Retention Incentive program in mid-2023, the automatic awarding of a Cost of Living Adjustment1, and the development of a collaborative work culture as evidenced by CPA being certified as a “Great Place to Work” earlier this year.

Bi-annual salary grade and benefit studies have been integral to this process of staying competitive. CPA’s salary grades and benefits were last comprehensively reviewed and updated in December 2022. The process to adjust salary grades includes:

1. A Board-approved adjustment in even years to ensure market alignment, using benchmarking data from the bi-annual full market study. This even year adjustment also includes the approximate magnitude of the forthcoming COLA.

2. An administrative adjustment of salary grades in odd years (when a full market study is not performed) to account only for COLA.

As 2024 is an “even year”, CPA re-engaged HR/Compensation consultant Mercer to assist with the 2024 salary and benefits benchmarking study and to develop strategies to ensure CPAs salaries and benefits remain competitive. The study methodology was very similar to the one that took place in 2022, the last “even year.”2 1 The annual COLA amount is budgeted for in the Board-approved annual budget and is based on the Consumer Price Index, Los Angeles 12-month value published by the Bureau of Labor Statistics for November and is effective January 1.
2 In 2022, CPA contracted with Mercer and 3 other CCA’s to establish job architecture, do compensation and benefits benchmarking, and establish Salary Grades. The salary and benefits benchmarking study examined the competitiveness of CPA’s compensation and benefits against a range of industries and public

Board of Directors Item 13

SALARY BENCHMARKING RESULTS
CPA’s compensation philosophy is to be in the 3rd Quartile of base salary and total cash compensation across the organization as measured against four different market sectors (CCAs, general industry, utilities/energy, and large-revenue public sector organizations).

The following three charts summarize the findings of the 2024 benchmarking study.

Broadly they show that CPA’s overall positioning for all positions is generally within this 3 rd Quartile. However, this positioning becomes more differentiated when senior executive positions (6 positions) are broken out.
sector entities. The focus of the study was on CPA’s competitive positioning in the areas of base salary, total cash compensation (TCC), and benefits. Compensation data was utilized from industry areas where CPA competes for talent and employee retention. For the benefits portion of the study, a value comparison of all benefits was conducted. Results of this engagement were presented to the CPA Board of Directors in December of 2022 in conjunction with Board approval of 2022 Salary Grades.

Board of Directors Item 13
PROPOSED 2025 SALARY GRADES
To align CPA salary grades for market competitiveness, Mercer’s study proposed the 2025 Salary Grades. The study proposes that CPA’s salary grades be updated modestly to incorporate the expected COLA amount (approximately 3%) and a 0.5% market

Board of Directors Item 13
adjustment factor that was calculated by comparing CPA salaries to Mercer’s extensive salary database, for a total of 3.5% adjustment. The recommended updates to the salary grades would not require salary adjustments for any staff. The current and proposed salary grades are below.

BENEFITS UPDATES AND REVISIONS TO EMPLOYEE HANDBOOK
Benefits offered by CPA are delineated in CPA’s Employee Handbook, which also outlines a number of rights and responsibilities, administrative requirements, and organizational procedures that govern an employee’s relationship with CPA. This year, updates and revisions to the Employee Handbook are being proposed for two primary purposes:

Board of Directors Item 13

1. To propose offering caregiver leave benefits for employees that must care for parents or stepparents, and;

2. To incorporate legal and administrative updates, including items that ensure compliance with current laws and laws effective January 1, 2025, and to clarify or clean up certain administrative procedures.

Caregiver Leave
Mercer’s benefits benchmarking study indicated that overall CPA’s overall benefits package remains competitive. The Benchmarking study also indicated a rising prevalence of employers who now offer Caregiver Leave benefits. Staff brought this idea forward to the Executive Committee for discussion and the Executive Committee supported adding this type of leave to the benefits package subject to some key limitations regarding eligibility and administration.

Key highlights of a newly proposed CPA’s Caregiver Leave benefit for employees who must care for their parents or stepparents:
• Providing up to 6 weeks of fully paid Caregiver Leave annually (with certification of health care provider) with a total cap of 12 weeks throughout the employee’s employment with CPA.
• To be eligible, an employee must have worked at CPA for at least one (1) calendar year.
• Benefit is available to care for parents or stepparents only. • Employees will not be required to apply for State Disability and/or Paid Family Leave (“PFL”) wage replacement benefits during an employee’s leave to access CPA benefits.
• Employees may apply for PFL benefits after the initial 6 weeks and take unpaid leave or use available sick or vacation leave to cover the difference between PFL benefits and their full salary.

Compliance with Current/Future Legal Requirements and Administrative Clarifications Key proposed changes in this category include:

Board of Directors Item 13
• Language modifications to minimize NLRA concerns while balancing operational issues, context and language itself, based on current and past NLRB guidance • Language modifications to comply with California or other legal requirements • Updates to and reorganization of various definitions
• Inclusion of language to include any other applicable state or local law since CPA allows remote work
• Clarifying varying decision-making/appeal/reporting processes to designate staff other than the CEO when appropriate (e.g., Director, Human Resources, Chief Administrative Officer)
• Modification of language for legally required meal and rest periods • Modifications to reflect recent amendments to the California Family Rights Act (CFRA) and to highlight distinctions between CFRA and FMLA • Inclusion of required and recommended language in the lactation break section • Modification of minimum increments for sick leave
• Clarification of time off for witness leave
• Replaced Domestic Violence/Sexual Assault/Serious or Violent Crime Leave section with updated Leave for Qualifying Acts of Violence section to comply with requirements effective January 1, 2025
On November 21, the Executive Committee unanimously recommended that the Board Adopt Salary Grades for CPA Employees (as specified in Attachment 2) and to adopt the updates to CPA’s Employee Handbook provided that eligibility for Caregiver Leave include a requirement that an employee be employed with CPA for at least 12-months prior.

FISCAL IMPACT
The changes to salary grades do not impact any particular employee’s current salary and therefore have no fiscal impact in the current budget year. Given the limited nature of the proposed salary grade adjustments, the fiscal impact in future years is likely to be minimal.

Board of Directors Item 13

ATTACHMENTS

1. Salary Grades, Benefits, Employee Handbook Updates Presentation

2. Proposed 2025 Salary Grades for CPA Employees

3. Resolution 24-12-079 Approving Modifications to CPA’s Employee Handbook and Benefits

4. Proposed December 2024 Employee Handbook (Color Coded)3 3 Blue text represents updates that are legally required or recommended by legal counsel. Orange text represents administrative edits or benefits updates.

Salary Grades/Benefits/Employee
Handbook Updates
December 5, 2024

Summary
CPA has made significant progress in retaining and recruiting a high-performing staff, even in the face of stiff labor market competition from the renewable energy industry, CCAs, and the private sector.

Vacancy and turnover rates have fallen into the single digits and earlier this year CPA was certified as a “Great Place to Work”.

Bi-annual salary grade and benefit reviews/updates have been integral to this success, as was the Executive/Management Retention Incentive program approved by the Board in concept in late 2022 and finalized in mid 2023.

CPA re-engaged HR/Compensation consultant Mercer to assist with the 2024 salary and benefits benchmarking study and to develop strategies to ensure CPAs salaries and benefits remain competitive.

CPA’s compensation philosophy is to be in the 3rd Quartile of base salary and total cash compensation across the organization as measured against four different market sectors (CCAs, general industry, utilities/energy, and large-revenue public sector organizations).

Mercer’s benchmarking study shows CPAs overall positioning for all positions is generally within this 3rd Quartile. This positioning becomes more differentiated when senior executive positions (6 positions) are broken out.

CPA remains competitive in benefits benchmarking and received Executive Committee input on the addition of Caregiver Leave for the growing number of employees with aging parents.

CPA Total Cash
CPA Base Salary Overall Positioning Summary by Market Key: Perspective for All Positions vs. CCAs
25th %ile
50th %ile
75th %ile
Max
Min
vs. CCAs vs. General Industry vs. Utilities/Energy vs. Public Sector

CPA Total Cash
CPA Base Salary Overall Positioning Summary by Market Key: Perspective for Senior Executives Only vs. CCAs
25th %ile
50th %ile
75th %ile
Max
Min
vs. CCAs vs. General Industry vs. Utilities/Energy vs. Public Sector

CPA Total Cash
CPA Base Salary Overall Positioning Summary by Market Key: Perspective Excluding Senior Executives vs. CCAs
25th %ile
50th %ile
75th %ile
Max
Min
vs. CCAs vs. General Industry vs. Utilities/Energy vs. Public Sector

Salary Grades Adjustment Process – Odd Years
“Odd Year” Process
• In odd years, when a full market study is not performed, a COLA is included in the staffing budget presented to the Board for approval in June. During the budget process, CPA staff forecasts an estimated amount for budget consideration utilizing the Consumer Price Index, Los Angeles 12-month values.
• The actual amount each annual COLA is based on the Consumer Price Index, Los Angeles 12-month value published for November.
• Once the COLA value is known, salary grades are adjusted accordingly and administratively. • For example, in November 2023, the Consumer Price Index, Los Angeles 12-month value for November was 2.8% so all salary grades were adjusted by 2.8%. • The annual adjustment of the salary grades became effective January 1, 2024. • These administrative adjustments keep CPA salary grades aligned with COLA.

Salary Grades Adjustment Process – Even Years
Bi-annual “Even Year” Process
• In even years, a full salary study is performed, assessing market data for four different market sectors (CCAs, general industry, utilities/energy, and large-revenue public sector organizations). • Utilizing this market data, Mercer recommends a salary range adjustment to integrate market alignment and the approximate magnitude of the forthcoming COLA. • This information is incorporated into proposed salary grades adjustments to be effective January 1 of the following year and is presented to the Board for approval. • The amount of each adjustment presented for consideration can vary. • This year the projected salary grade adjustment to maintain market alignment and the projected COLA is very close, within 1%, reflecting CPA’s overall market positioning and competitiveness. • By comparison, in 2022, the overall approved salary grade adjustment was 9%, 3% of which was for a market adjustment and 6% of which was for the inflation-based COLA.

Salary Grade Structure
As recommended by Mercer, salary ranges should be adjusted by 3.5% to keep pace with market and light design updates should be made (broader range spreads and modify midpoint differentials) Range movement would integrate market alignment and partially account for expected inflation and upcoming COLA adjustments
With the recommended updates to the salary grades, employees would remain at similar position in range without needs for salary adjustments. This change has no immediate fiscal impact CPA Pay ratio: Highest paid employee to lowest paid employee is 4.6 on cash basis and 5.4 on TCC basis.

Best practice (benchmarked against B-Corps) is that TCC pay ratio should not exceed 7.0 2025 Salary Structure: +3.5% and Light Design Updates
Grade Minimum Midpoint Maximum
Midpoint
Progression
Range
Spread
116 $325,270 $447,246 $569,223 30% 75%
115 $254,841 $344,036 $433,230 25% 70%
114 $211,708 $275,220 $338,733 20% 60%
113 $176,423 $229,350 $282,277 20% 60%
112 $152,900 $191,125 $229,350 15% 50%
111 $132,957 $166,196 $199,435 15% 50%
110 $115,614 $144,518 $173,422 15% 50%
109 $100,534 $125,668 $150,801 15% 50%
108 $87,421 $109,276 $131,132 15% 50%
107 $76,018 $95,023 $114,028 15% 50%
106 $66,103 $82,629 $99,154 50%
2024 Salary Structure
Grade Minimum Midpoint Maximum
Midpoint
Progression
Range
Spread
116 $315,192 $425,509 $535,825 25% 70%
115 $252,150 $340,407 $428,654 32% 70%
114 $205,722 $257,152 $321,440 18% 56%
113 $174,341 $217,927 $272,409 18% 56%
112 $153,885 $184,663 $221,595 15% 44%
111 $133,814 $160,576 $192,690 15% 44%
110 $116,359 $139,630 $167,558 15% 44%
109 $101,182 $121,418 $145,702 15% 44%
108 $87,983 $105,582 $126,698 15% 44%
107 $76,508 $91,810 $110,172 15% 44%
106 $66,528 $79,834 $95,801 44%

Benefits Updates
Mercer’s benefits benchmarking study indicated that overall CPA’s overall benefits package remains competitive. The Benchmarking study also indicated a rising prevalence of employers who now offer Caregiver Leave benefits. Staff brought this idea forward to the Executive Committee for discussion and the Executive Committee supported adding this type of leave to the benefits package subject to some key limitations regarding eligibility and administration, such as an eligibility requirement of at least one (1) calendar year of employment with CPA.

Key highlights of a newly proposed CPA’s Caregiver Leave benefit for employees are:
• Providing up to 6 weeks of fully paid Caregiver Leave annually (with certification of health care provider) with a total cap of 12 weeks throughout the employee’s employment with CPA • To be eligible, employee must have worked at CPA for at least one (1) calendar year. • Benefit is available to care for parents or stepparents only. • Employees will not be required to apply for State Disability and/or Paid Family Leave (“PFL”) wage replacement benefits during an employee’s leave to access CPA benefits. • Employees may apply for PFL benefits after the initial 6 weeks and take unpaid leave or use available sick or vacation leave to cover the difference between PFL benefits and their full salary.

Employee Handbook Updates
With the exception of the proposed addition of Caregiver Leave, the primary updates to the employee handbook are legally required updates to comply with current and future legal requirements and administrative clarifications. Examples of key proposed changes in this category include:
• Language modifications to comply with California or other legal requirements including modifications to reflect recent amendments to the California Family Rights Act (CFRA) and to highlight distinctions between CFRA and Family Medical Leave Act (FMLA)
• Replaced Domestic Violence/Sexual Assault/Serious or Violent Crime Leave section with updated Leave for Qualifying Acts of Violence section to comply with requirements effective January 1, 2025 • Inclusion of language to include any other applicable state or local law since CPA allows remote work • Clarifying varying decision-making/appeal/reporting processes to designate staff other than the CEO when appropriate (e.g., Director, Human Resources, Chief Administrative Officer) • Modification of language for legally required meal and rest periods • Modification of minimum increments for sick leave
• Updates to and reorganization of various definitions

Recommendations
Executive Committee met on November 21 and provided direction to bring the following recommendations to the Board for consideration

1. Approve Salary Grades to accommodate labor market changes, inflation, and maintain CPA’s competitiveness

2. Approve the updates to CPA’s Employee Handbook to include proposed benefits related to caregiver leave and to comply with current and future legal requirements and administrative clarifications
Fiscal Impact

1. The changes to salary grades do not impact any particular employee’s current salary and therefore have no fiscal impact in the current budget year. Given the limited nature of the proposed salary grade adjustments, the fiscal impact in future years is likely to be minimal.

ATTACHMENT 1

RESO NO. 24-12-079
RESOLUTION NO. 24-12-079

RESOLUTION OF THE BOARD OF DIRECTORS OF CLEAN

POWER ALLIANCE OF SOUTHERN CALIFORNIA TO

APPROVE MODIFICATIONS TO THE CPA EMPLOYEE

HANDBOOK

THE BOARD OF DIRECTORS OF CLEAN POWER ALLIANCE OF
SOUTHERN CALIFORNIA HEREBY RESOLVES AS FOLLOWS:

WHEREAS, Clean Power Alliance of Southern California (formerly known as Los Angeles Community Choice Energy Authority) (“Clean Power Alliance” or “CPA”) was formed on June 27, 2017;
WHEREAS, on August 16, 2018, the Board of Directors (“Board”) adopted and approved Resolution 18-012 approving the original version of the Employee Handbook, on September 5, 2019 and adopted and approved Resolutions 19-09-017 and 22-12- 045 approving revisions to the Employee Handbook;
WHEREAS, the Employee Handbook is one representation of CPA’s desire to be a leader in fair and equitable treatment of employees, to foster an open, collaborative, and dynamic working environment, and to recognize the valuable resources that CPA staff represent;
WHEREAS, the Employee Handbook serves as a guide and provides information about working conditions, benefits, practices, and other policies regarding employment with CPA. The Employee Handbook does not cover all issues regarding employment, and is not intended to be a binding contract; WHEREAS, the Board intends and desires to have the Employee Handbook reviewed from time to time and to supplement, amend, or rescind any policies or portion of the Employee Handbook as is necessary or beneficial to CPA; WHEREAS, a revision of the Employee Handbook is now necessary and beneficial to reflect CPA’s current and anticipated operational situation; and, WHEREAS, the revised Employee Handbook has been presented to the Board and attached to the December 5, 2024 Board Agenda.

NOW, THEREFORE, BE IT DETERMINED, AFFIRMED, AND ORDERED BY

THE BOARD OF DIRECTORS OF THE CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA that the revised Employee Handbook, which is attached hereto as Exhibit A, is hereby approved effective December 5, 2024, and a copy will be distributed to each CPA employee and any future employees upon hire.

IT IS FURTHER DETERMINED, AFFIRMED, AND ORDERED that any and all acts authorized pursuant to this Resolution and performed prior to the passage of this Resolution are hereby ratified and approved; and

RESO NO. 24-12-079
IT IS FURTHER DETERMINED, AFFIRMED, AND ORDERED that this Resolution shall be continuing and remain in full force and effect.

APPROVED AND ADOPTED this 5th day of December 2024.

Deborah Klein Lopez, Chair
ATTEST:

Gabriela Monzon, Secretary

Pg. 1

CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA

EMPLOYEE HANDBOOK
December 2024
Blue text represents updates that are legally required or recommended by legal counsel.

Orange text represents administrative edits or benefits updates.

Pg. 2
Welcome to Clean Power Alliance of Southern California
Dear CPA Employee:

Congratulations on your employment with Clean Power Alliance of Southern California (CPA)! We at CPA share great pride and passion in our work, and we’re glad you’re joining us to help advance our mission for the benefit of our customers, our environment, and our communities.

As an employee of CPA, you are our most valuable resource. With your talent and abilities, as well as those of the rest of our team, we plan to continue fostering an open, cooperative, and dynamic environment. It is our hope that you find CPA a rewarding place to work.

Information regarding the procedures, practices, policies, and benefits of CPA are contained within this handbook and we encourage you to review carefully and become familiar with them. CPA’s policies may change from time to time, and employees are expected to comply with the most current provisions.

If you would like further information or have questions about any of the information outlined in this handbook, please feel free to reach out to People & Culture to discuss.

On behalf of CPA Board of Directors and staff, I extend a warm welcome to our team!
Sincerely,
Ted Bardacke
Chief Executive Officer

Pg. 3
About This Handbook
This Handbook supersedes any prior versions of handbooks. If it contains policies or procedures that are inconsistent with other statements of policy or procedure, those in the Handbook will govern unless expressly stated otherwise or as otherwise provided by applicable law. The Handbook is not all-inclusive but is intended to provide general information to assist you in the performance of your duties. It is intended to comply with all applicable federal, state, and local laws, which may change from time to time. If any provision of the Handbook conflicts with such laws, CPA will follow applicable law.

CPA may revise, interpret, delete, or add to any policies, procedures, work rules or benefits stated in this Handbook or in any other document at any time, in its sole discretion (other than the at-will policy specified herein), unless otherwise restricted by applicable law. As such, the policies (other than the at-will policy specified herein), procedures and benefits summarized in the Handbook will be reviewed and revised from time to time. If the Handbook does not address a particular policy or procedure, CPA reserves the right to modify the Handbook in the future or provide separate policies and procedures. Written changes to this Handbook will be distributed or posted after they are made. Your input is important to us, and we encourage you to discuss any thoughts or questions about the Handbook with Human Resources.

This Handbook contains only guidelines and does not create, and may not be used as evidence of, a contract, bargain, agreement, or guarantee of employment for any definite length of time or as a guarantee or contract for any benefits or working conditions. Rather, all employees are at-will, meaning the employee or CPA may terminate the employment relationship at any time, with or without cause or prior notice, unless a written agreement signed by the Chief Executive Officer provides otherwise. Please note CPA also may change the terms and conditions of your employment at any time (other than the at-will policy specified herein), with or without cause and with or without prior notice, all in accordance with applicable law.

This notice applies to all employees regardless of date of hire.

Pg. 4

TABLE OF CONTENTS
Section 1: Background Page 5
Section 2: Introduction & General Provisions Page 5
Section 3: Employment Status Page 13
Section 4: Employment Policies & Procedures Page 16
Section 5: Office Hours & Timekeeping Page 22
Section 6: Leave Page 26
Section 7: Employment Records Page 47
Section 8: General Workplace Rules Page 50
Section 9: License, Memberships, Training & Conferences Page 53 Section 10: Pay Page 54
Section 11: Employee Conduct Page 56
Section 12: Employee Benefits Page 60
Section 13: Layoff / Separation from Employment Page 61 Section 14: Salary Disclosure Page 63

Pg. 5
SECTION 1: CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA

BACKGROUND
The Clean Power Alliance of Southern California (“CPA”) was formed in 2017 as a Joint Powers Authority (JPA), administering a Community Choice Aggregation (“CCA”) in Southern California. CPA is governed by the Board of Directors (“Board”) with voting membership consisting of elected officials, and their alternates, from the member agencies who make up the JPA.

A CCA, authorized in California under AB 117 and SB 790, allows local governments, including counties and cities, to purchase wholesale power supplies for resale to their residents and businesses as an alternative to electricity provided by an Investor Owned Utility, which for CPA members is Southern California Edison (“SCE”). Electricity procured to serve customers continues to be delivered over SCE’s transmission and distribution system.

CPA exists to serve residential and non-residential customers located within its member communities. CPA’s specific objectives are to provide its customers with a reliable supply of electricity, at competitive electric rates, sourced from a generation portfolio with lower greenhouse gas emissions and higher renewable content than the incumbent utility.

SECTION 2: INTRODUCTION & GENERAL PROVISIONS
A. Introduction. This Employee Handbook (“Handbook”) is intended to serve as a guide to many questions employees may have about their employment with CPA. It is not intended to cover all issues regarding employment, and it is not intended to be a binding contract.

B. At-Will Employment. CPA employees are employed on an at-will basis. Employment at-will means that the employment relationship may be Terminated with or without cause and with or without advance notice at any time by the employee or CPA. Nothing in this Handbook shall limit the right to Terminate at-will employment. No person at CPA has any authority to enter into an agreement for employment for any specified period of time or to make an agreement for employment other than at-will terms except for the Chief Executive Officer of CPA. Any such agreement shall only be binding if it is in writing and signed by the Chief Executive Officer.

C. Applicability to Employees with Separate Agreements. Except where there is an express conflict in terms, the provisions of this Handbook shall apply to each employee who holds a separate employment agreement with CPA. In the event of such a conflict in terms, the terms of the separate employment agreement will control.

D. Employee Responsibility. This Handbook is designed to acquaint employees with CPA and provide information about working conditions, employee benefits, and other employment policies. Employees are required to read, understand, and comply with all provisions of this Handbook.

E. Amendment and Revision of Handbook. No employee handbook can anticipate every circumstance or question about policy. The need may arise, and CPA reserves the right to revise, supplement, or rescind any policies or portion of the Handbook from time to time as it deems appropriate, in its sole and absolute discretion. Employees will be notified of changes to the Handbook as they occur. The only recognized revisions of these policies are

Pg. 6
those that are issued in writing by the Chief Executive Officer and if revisions are material or non-administrative, with approval of the Board as appropriate.

F. Distribution of Handbook. A copy of this Handbook will be distributed to each CPA employee. Newly hired employees will receive a copy upon hire. An employee with questions about provisions in this Handbook may direct them to the Director, People & Culture.

G. Prior Policies. The terms and provisions of this Handbook adopted on December 5, 2024 by Resolution of the Board supersedes the prior Handbook adopted on December 1, 2022 by Resolution. However, in no event shall this Handbook supersede any other prior resolution, policy, rule or regulation that has been adopted by CPA’s Board of Directors.

H. Changes to the Law. When any local, state, or federal ordinance, regulation, or law that is incorporated in the Handbook or upon which the Handbook relies is amended through legislative action or is deemed to have been amended by judicial decision, the Handbook shall be deemed amended in conformance with those amendments.

I. Severability. If any section, subsection, sentence, clause, or phrase of the Handbook is found to be illegal by a court of competent jurisdiction, such findings shall not affect the validity of the remaining portions of the Handbook, to the maximum extent permitted by applicable law.

Definitions
For the purposes of this Handbook, the following definitions apply:

A. Applicant. A person who has applied for employment with CPA.

B. Chief Administrative Officer. A person holding the title of Chief Administrative Officer (CAO) of CPA or the Chief Executive Officer’s designee performing the CAO responsibilities.

C. Chief Executive Officer. The Chief Executive Officer of CPA or the Chief Executive Officer’s designee.

D. Close relatives. Spouse, parent, parent-in-law, grandparent, child, child-in-law, uncle, aunt, nephew, niece, sibling, sibling-in-law, step-relatives, and cousins.

E. Date of Hire. The date that an employee was originally hired by CPA. An employee’s date of hire does not change except through termination, layoff, resignation, or retirement.

F. Day or Days. Calendar day(s) unless otherwise stated.

G. Demotion. The movement of an employee from one position to another position having a lower level and/or maximum rate of pay.

H. Director. A person holding the title of Director or a higher title at CPA.

I. Director, Human Resources. The Director, People and Culture fills the roll of Director, Human Resources at CPA. In the absence of a staff member who has been assigned the responsibilities of Director, Human Resources, the CAO or in the CAO’s absence, the Chief Executive Officer’s designee shall act in that capacity.

J. Discipline. The practice or counseling of an employee by verbal warning, written reprimand, performance improvement plan, demotion, suspension, reduction of pay, termination, or other punitive measures.

K. Exempt Employees. Employees whose duties and responsibilities allow them to be “exempt” from overtime pay provisions as provided by the Fair Labor Standards Act

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(“FLSA”) and any applicable state wage and hour laws. Exempt employees include, but are not limited to, those who qualify for the executive, administrative or professional exemptions under California law.

L. Full-Time Employee. A regular, budgeted position in which an employee of CPA is regularly scheduled to work at least 40 hours per workweek. Employees in full-time positions are eligible for CPA’s benefit package, subject to terms, conditions, and limitations of each benefit program, plus legally mandated benefits, such as worker’s compensation, and paid sick leave.

M. Interns. Employees gaining supervised practical experience in a professional field. Interns are not eligible for benefits listed in this Handbook, whether compensated or not, unless otherwise required by law. Interns will generally not be employed for more than six (6) months.

N. Introductory Period. All new and rehired employees work in an “introductory” status for the first three (3) months after their date of hire. This Introductory Period gives the Supervisor the opportunity to determine the ability with which the employee performs the employee’s job. It also provides the employee with the opportunity to decide if the employee is satisfied with the position. CPA reserves the right to extend the duration of the Introductory Period when such an extension is determined appropriate in CPA’s sole and absolute discretion. Either CPA or the employee can terminate the employment relationship at any time during or after the Introductory Period, with or without cause and without any advance notice.

O. Layoff. The separation of employees from the active work force due to organizational changes, lack of work or funds or abolishment of a position by CPA’s Board.

P. Non-Exempt Employees. An individual who is not exempt from the overtime provisions of federal and state wage and hour law and is, therefore, entitled to overtime pay for all hours worked beyond 40 in a workweek or eight (8) in a work day, unless otherwise required by applicable law. Non-exempt employees may be paid on a salary, hourly or other basis.

Q. Part-time Employee. A regular, budgeted position requiring an employee to work a usual schedule of less than 40 hours per workweek. Employees in part-time positions receive legally mandated benefits and may be eligible for some benefits where expressly specified in this Handbook.

R. Promotion. The movement of an employee from one position to another position with a higher level and/or maximum rate of pay.

S. Reduction in Pay. A temporary or permanent lowering of an employee’s rate of pay.

T. Rejected/Rejection. The termination by CPA of a new employee who has not successfully completed the Introductory Period for a position.

U. Resignation. The voluntary termination of employment by an employee.

V. Subordinate. An employee who directly reports to a specific supervisor and whose work is directed, reviewed, and evaluated by that supervisor. Subordinates are typically responsible for executing tasks or objectives assigned by their supervisor within the scope of their role.

W. Supervisor. The individual to whom an employee directly reports. Typically, this individual will conduct the Introductory and Performance reviews.

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X. Suspension. The temporary separation from service of an employee, without pay, for disciplinary purposes.

Y. Temporary Employee. An employee hired with the understanding that their employment will not continue beyond a stated date or beyond completion of a specified project or projects.

Temporary employees will generally not be employed for more than six (6) months.

Temporary employees are not eligible for benefits covered in this employee handbook, other than those required by law or as stipulated in writing by the Chief Executive Officer. An employee will not change from temporary to any other employee status or classification simply because of the length of time spent as a temporary employee. The status of a temporary employee may change only if the employee is notified of the change in writing by Human Resources.

Z. Termination/Terminate. The permanent separation of an employee from employment with CPA, with or without cause.

AA. Vacancy. A position that is unfilled but has been included in the current budget.

Equal Employment Opportunity
A. Equal Employment Opportunity. CPA is an equal employment opportunity employer and will consider all qualified applicants for employment or advancement opportunities without regard to actual or perceived race, religion, creed, color, sex or gender (including pregnancy, childbirth, related medical conditions and lactation), sexual orientation, gender identity or gender expression (including transgender status), national origin, ancestry, citizenship status, military service and veteran status, marital status, age, protected medical condition as defined by applicable state or local law, reproductive health decision making, genetic information, disability, or any other characteristic protected by applicable federal, state, or local laws and ordinances. Employment-related decisions will be based on merit, qualifications, and abilities. Equal employment opportunity will be extended to all persons in all aspects of the employer-employee relationship, including recruitment, hiring, training, promotion, transfer, discipline, layoff and termination.

B. Disabled Applicants and Employees. CPA has a commitment to ensure equal opportunities for disabled applicants and employees. Every reasonable effort will be made to provide an accessible work environment for such employees and applicants. Employment practices (e.g., hiring, training, testing, transfer, promotion, compensation, benefits, and discharge) will not discriminate unlawfully against disabled applicants or employees. CPA provides employment-related reasonable accommodations to qualified individual with disabilities within the meaning of the California Fair Employment and Housing Act (“FEHA”) and the Americans with Disabilities Act (“ADA”), as well as any other applicable state or local law or ordinance.

C. Request for accommodation. An applicant or employee who desires a reasonable accommodation in order to perform essential job functions shall submit a written request to the Director, Human Resources identifying in reasonable detail: a) the job-related functions at issue; and b) the desired accommodation(s). Reasonable accommodation may include, but is not limited to job restructuring, reassignment to a vacant position for which the employee is qualified and making facilities accessible.

D. Reasonable documentation of disability. Following receipt of the request, the Director, Human Resources may require additional information, such as reasonable documentation of the existence of a disability or additional explanation as to the effect of the disability on the

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individual’s ability to perform the essential job functions but will not require disclosure of diagnosis or genetic history.

E. Interactive process. CPA will engage in the interactive process, as defined by applicable law, to determine whether an applicant or employee is able to perform the essential job functions of the position. During this process, CPA will examine potential reasonable accommodations that will make it possible for the employee or applicant to so perform. Such interactive process may include meeting(s) with the employee or applicant, CPA, and, if requested by CPA, the employee or applicant’s health care provider.

F. Case-by-case determination. CPA shall determine, in its sole discretion, whether reasonable accommodations(s) can be made, and the type of reasonable accommodations(s) to provide. CPA will not provide an accommodation that would pose an undue hardship upon it or that is not required by law. CPA will inform the employee or applicant of any decisions made under this section in writing.

G. Religious accommodations. CPA also respects the sincerely held religious beliefs and practices of all employees and will endeavor to make a reasonable accommodation if those sincerely held religious beliefs or practices conflict with an employee’s job unless the accommodation would impose an undue hardship on the operation of our business. Any employee who would like to request an accommodation should follow the same process as outlined above.

H. Raising concerns. Employees with questions or concerns about equal employment opportunities in the workplace may bring these issues to the attention of Director, Human Resources. Reports of discrimination should be made in accordance with the procedure set forth in the Policy Prohibiting Harassment, Discrimination, and Retaliation section as well as any procedures set forth in any applicable state supplement. We will not allow any form of retaliation against employees who raise concerns of equal employment opportunities in the workplace.

Proof of Right to Work
A. Under federal law, all new employees must complete INS Form I-9 and produce original documentation establishing their identity and right to work in the United States. New hires may establish their identity and right to work by:

1. Providing documentation that singularly establishes both their identity and employment authorization (identified “List A” documents on the INS Form I-9), or

2. providing documentation that separately establishes their identity (“List B” documents on the INS Form I-9) and their employment authorization (“List C” documents on the INS Form I-9).

B. Documentation should be produced prior to or on day of commencement of employment with CPA. Required documentation must be presented to the Director, Human Resources, who will be responsible for processing the documents.

C. Employees who are re-hired must provide proper documentation if the prior INS Form I-9 has expired or is about to expire. Authorization documents will be copied and placed with the employee’s INS Form I-9 in a file separate from the employee’s personnel file.

Code of Ethics and Conflicts of Interest

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A. Code of Ethics. Employees have an obligation to conduct their work responsibilities within guidelines that prohibit actual or potential conflicts of interest. An employee shall contact the General Counsel or General Counsel designee with a question regarding the existence of an actual or potential conflict of interest. This Code of Ethics is not intended to supersede or invalidate any statute, resolution, ordinance, or regulation.

1. Applicability. This Code of Ethics shall apply to all employees.

2. Substantive requirements.
a. All employees shall uphold the Constitution of the United States. b. All employees shall comply with all applicable provisions of California law governing public employees and officials, particularly the California Political Reform Act and its provisions on gifts and conflicts of interest, and any other applicable state or local law.
c. No employee shall engage in any activity which results in any of the following:
i. Use of time, facilities, equipment, supplies, or other resources of CPA for the private advantage or gain for oneself or another;
ii. Use of official information that is not available to the general public for private advantage or gain for oneself or another; and
iii. Use of the authority of their position with CPA to discourage, restrain, or interfere with any person who chooses to report potential violations of any law or regulation.
d. No employee shall directly or indirectly accept:
i. Private advantage, remuneration, or reward for oneself or another as a result of the prestige or influence of the office, employment, or appointment the employee holds with CPA;
ii. Financial consideration from any source other than CPA for the performance of the employee’s official duties; or
iii. Employment from private interests, when such employment is incompatible with the proper discharge of their official duties or may result in a conflict of interest, unless otherwise permitted to do so by applicable law.
e. No employee shall give special treatment or consideration to any individual or group beyond that available to any other individual or group. f. No employee shall discriminate against or harass a citizen or co-worker on the basis of actual or perceived race, religion, creed, color, sex or gender (including pregnancy, childbirth, related medical conditions and lactation), sexual orientation, gender identity or gender expression (including transgender status), national origin, ancestry, citizenship status, military service and veteran status, marital status, age, protected medical condition as defined by applicable state or local law, reproductive health decision making, genetic information,

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disability, or any other characteristic protected by applicable federal, state, or local laws and ordinances.
g. All employees shall conduct themselves in a work-appropriate manner at all times during the performance of their duties.
h. All employees shall complete mandatory Harassment Prevention Training.

3. Enforcement. Any employee found to be in violation of this Code of Ethics shall be subjected to appropriate Discipline.

B. Outside Employment, Enterprise, or Activity. No employee may engage in any outside employment, enterprise, or activity that is inconsistent incompatible, in conflict with, or adverse to the employee’s employment or the employee’s ability to perform the employee’s duties and responsibilities, including performance of overtime work and emergency duties, or any other aspect of CPA operations, unless otherwise permitted to do so by applicable law.

Employees are required to make requests for approval for outside employment in writing by completing a required Outside Employment Approval Request form and submitting it to Director, Human Resources. The form must include all outside employment in which an employee is already engaged or in which they intend to engage, so that CPA may assess whether such outside employment conflicts with the employee’s CPA employment.

Regardless of the assessment, all Outside Employment Approval Request forms shall be maintained in the employee’s personnel file.

1. Unless otherwise provided by applicable law, an employee’s outside employment, enterprise, or activity will be prohibited when any of the following are present:
a. It involves the receipt or acceptance by the employee of any money or other consideration from anyone other than CPA for the performance of an act which the employee would be required or expected to render in the regular course or hours of the employee’s employment with CPA or as part of the employee’s duties as a CPA employee;
b. It involves the use for private gain or advantage of CPA time, facilities, equipment and/or supplies; or the badge, prestige, or influence of the employee’s CPA employment;
c. It involves the performance of an act, in other than the employee’s capacity as a CPA employee, which may later be subject directly or indirectly to the control, inspection, review, audit, or enforcement of any other officer or employee of CPA; or
d. It involves time or scheduling demands as would render performance of the employee’s duties as a CPA employee less efficient.

2. Conflict Determination. When a request for approval of outside employment is submitted to the Director, Human Resources, they shall determine whether the employee’s outside employment conflicts with the performance of the employee’s duties and shall advise the employee of that determination in writing.

3. Appeal of conflict determination. An employee may appeal the conflict decision to the Chief Executive Officer within 14 Days from the employee’s receipt of the conflict determination by filing a written appeal with the Chief Executive Officer. The employee

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shall specify the grounds on which the employee challenges the conflict decision and shall attach all relevant documentary evidence to the appeal. The Chief Executive Officer shall schedule a meeting with the employee to discuss the decision. The Chief Executive Officer shall issue a written decision to the employee within 14 Days from the date of the meeting.

The decision of the Chief Executive Officer shall be final.

4. Disciplinary Action. Any employee who fails to act upon notice of a conflict of interest or who fails to file an Outside Employment Request may be subject to disciplinary action up to and including termination, unless otherwise provided by applicable law.

C. Contracts and Conflicts of Interest. No CPA employee can be financially interested in any contract made by the employee in the employee’s official capacity, or by any board of which the employee is a member.

1. An actual or potential conflict of interest occurs when an employee can influence a decision that may result in a personal gain for that employee or for a member of their immediate family as a result of CPA’s decisions and/or business dealings. For the purposes of this Handbook, immediate family includes persons related by blood or marriage or, whose relationship with the employee is similar to that of persons who are related by blood or marriage.

2. No presumption of conflict is created by the mere existence of a relationship with outside firms. However, if an employee has any influence on transactions involving purchases, contracts, or leases, it is imperative that the employee discloses to employee’s Supervisor as soon as possible the existence of any actual or potential conflict of interest so that safeguards can be established to protect all parties.

3. AB 1234 Ethics training is required for all CPA employees within 30 Days of hire and every two (2) years thereafter. Upon completion of training, a copy of the certificate of completion must be provided to the Director, Human Resources. On-line training is offered at www.fpcc.ca.gov. However, other courses may be available. See the Director, Human Resources for other options.

4. CPA employees required to complete California Fair Political Practices Commission Form 700 (Statement of Economic Interests) will be designated by the Fair Political Practices Commission (“FPPC”) adopted Conflict of Interest Code for CPA.

D. Conduct During the Workday. During the workday, employees are expected to devote their full time in the performance of their assigned duties. Any approved outside work, part-time job, hobbies, or personal business must be performed during off duty hours. Off duty hours include legally-required meal and rest periods, but do not include other break periods during which the employee continues to receive pay.

E. Political Activity. Employees may not engage in political activity during working hours or while on CPA property, unless otherwise provided by applicable law.

F. Solicitations of Political Contributions. No employee may knowingly, directly or indirectly, solicit a political contribution during working hours, on CPA premises or using CPA property, equipment, or email. For purposes of this section, “contribution” means a payment, a forgiveness of a loan, a payment of a loan by a third party, or an enforceable promise to make

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a payment except to the extent that full and adequate consideration is received, unless it is clear from the surrounding circumstances that it is not made for political purposes.

G. Reporting Suspected Misconduct.

1. Reporting to CPA. CPA encourages all employees and interested third parties to report alleged misconduct to the Director, Human Resources, or to a third party designated by CPA to intake complaints, to ensure that all allegations are thoroughly investigated, and suitable action(s) are taken where appropriate. Corrective action, up to and including termination, will be taken where warranted for employees.

2. External Reporting. Reports regarding suspected waste, fraud, and abuse may be directed to a third party designated by CPA to intake complaints, which may be anonymous or to the Public Integrity Division of the Los Angeles County District Attorney’s Office, 320 West Temple Street, Room 766, Los Angeles, California 90012, (213) 974-6501.

3. Confidentiality and Anonymous Complaints. Reports made to or about CPA regarding suspected misconduct will be treated as confidential information, to the extent possible, and can be communicated anonymously. However, it is important that the reporting individual understand and be aware of the following:
a. CPA discourages the use of anonymous complaints because anonymity in the complaint procedure may compromise CPA’s ability to complete a thorough investigation.
b. Should CPA learn of the complaining party’s identity, CPA cannot guarantee that the complaining party’s identity will remain confidential where CPA determines that disclosure of information is necessary to complete the investigation or is otherwise required to be disclosed by applicable law.

4. Protection Against Retaliation.
a. Any employee who makes a complaint under this policy or otherwise engages in “whistleblowing” (through internal reporting or reports made to government agencies) is protected against adverse employment actions for raising allegations of misconduct. An employee is protected even if the allegations prove to be incorrect or unsubstantiated.
b. Employees who participate or assist in an investigation will also be protected.

SECTION 3: EMPLOYMENT STATUS
Introductory Periods
A. Objective of Introductory Period. The Introductory Period shall be regarded as a part of the selection process and shall be used for closely observing the employee’s work, to determine if the employee can successfully perform the assigned duties of the employee’s position and CPA’s rules and policies, and to help ensure the employee effectively adjusts to the employee’s position.

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B. Introductory Period. All Full-Time and Part-Time Employee positions shall be subject to an Introductory Period of three (3) months unless the employee is notified in writing of an extension in accordance with section C of this Section 3.

C. Extension of Introductory Period. Written notice shall be provided as soon as reasonably possible to the employee if an Introductory Period is to be extended. The Introductory Period, upon approval of the Director, Human Resources may be extended up to a maximum of six (6) months, before expiration of the initial three (3) month period.

D. Rejection of Employee on Introductory Period. During the initial Introductory Period, an employee may be terminated at any time, with or without cause, and with or without advance notice. If this occurs, Notification of Rejection will be served on the employee. The employee will have no right of appeal of the employee’s failure to complete the Introductory Period or of the decision to terminate employment.

E. At-Will Employment. By completing the Introductory Period, an at-will employee is not guaranteed continued employment for any term. The employee will continue to be employed at-will, such that the employment relationship may be Terminated with or without cause and with or without advance notice at any time by the employee or CPA.

Background Checks
Although CPA does not provide, accept, or consider applications for employment on a discriminatory basis, it reserves the right to condition all offers of employment on the successful clearance of a lawful background check administered by an independent third-party service. Background clearance shall include satisfactory evidence of identity and legal eligibility to work in the United States. Any falsification of material information provided by any candidate for employment (or omission of material information) may result in a denial of an offer of employment or, if the employee has already been hired, immediate termination of employment.

Performance Evaluations
A. In General

1. The provisions in this section regarding performance evaluations are intended to provide a formal opportunity to discuss job tasks, identify and correct weaknesses, encourage, and recognize strengths, discuss positive, purposeful approaches for meeting goals, and develop new goals. However, employees and their Supervisors are strongly encouraged to discuss job performance and goals on an informal, day-to-day basis throughout the year.

2. The performance evaluation may be used to promote or identify training or to institute a performance improvement plan for an employee or as a basis for disciplinary action.

However, a performance evaluation is not, itself, disciplinary in nature. Only job-related factors shall be used to evaluate an employee’s work performance. Supervisors are responsible for the timely evaluation of employees in their departments, and, if applicable, they may solicit the assistance of lower and higher-level Supervisors in the preparation of the performance evaluation.

B. Timing

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1. Introductory Evaluations.
a. Before expiration of an Introductory Period, the Supervisor will have a review with the employee covering their work performance (“Introductory Evaluation”). Upon such discussion, a written evaluation will be provided to the employee and signed by both the employee and the Supervisor. b. An employee may file a response letter to the Director of Human Resources within three (3) business days. The response letter will be forwarded to the supervisor of the Supervisor preparing the Introductory Evaluation. The Supervisor’s supervisor and/or Human Resources shall make the final determination as to whether each Introductory employee has successfully completed the Introductory Period or has been Rejected from employment. As set forth above, completion of the Introductory Period does not impact an employee’s at-will status.

2. Performance Evaluations. CPA encourages an open dialogue between an employee and the employee’s Supervisor on a regular basis. This interaction increases job satisfaction for the employee and CPA. Formal performance evaluations will be conducted at least annually or with more frequency dependent on the length of service, job position, past performance, change in job duties, or recurring performance concerns. a. Performance evaluations will first consist of a meeting with the employee’s Supervisor. A standard template evaluation form and meeting format will be used.

Following the meeting, a formal written evaluation will be prepared by the Supervisor.
b. After the review of the performance evaluation, the employee will be asked to sign the evaluation report to acknowledge that it has been presented to employee and discussed with employee and Supervisor, and that employee is aware of its contents.
c. Employee may decide to not sign the performance evaluation and file a response letter with the Director, Human Resources within three (3) business days of receiving the performance evaluation.
d. Within five (5) business days, the supervisor of the Supervisor performing the evaluation and/or Human Resources will review the response letter and determine whether to adjust the performance evaluation. The decision of the Supervisor’s supervisor and/or Human Resources shall be final.

C. Relation to Merit Salary Increases. Merit-based pay adjustments may be awarded by CPA as part of the formal performance evaluation process and in accordance with its salary administration guidelines to recognize employee performance. However, the decision to award such an adjustment is not guaranteed and is instead dependent upon numerous factors, including the inclusion of funding for such adjustments in CPA Board-approved annual budget, as well as an employee’s performance evaluation.

D. Maintenance of Performance Evaluation. When a performance evaluation is recorded in the personnel file of an employee, a copy of such evaluation, together with any attachment relating thereto, shall be given to the employee. The content of each employee evaluation report is confidential and will not be discussed with or by any person except the employee

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being evaluated, the employee’s Supervisor, the Director, Human Resources, and/or the Chief Executive Officer, unless otherwise required by applicable law.

Disciplinary Action
Employees are expected to meet acceptable standards of conduct. Satisfaction of these standards not only promotes productivity and efficiency, but also helps to ensure that all employees will enjoy a pleasant and cooperative work environment. CPA views compliance with these commonsense rules to be an important responsibility of every employee. Consequently, violation of these rules may lead to disciplinary action up to and including termination.

As explained elsewhere in this handbook, employment will continue only at the mutual consent of the employee and the employer. Employment is therefore terminable at will, at any time, either by the employee or by CPA, with or without cause or advance notice. Accordingly, CPA does not adhere to any formal system of discipline. Nevertheless, where CPA determines it to be appropriate in the exercise of its discretion, it may attempt to give an employee a prior written or oral warning and an opportunity to improve or correct an issue of misconduct before termination.

It is impossible to identify every type of possible misconduct, infraction, or performance problem that can result in discipline. The following is therefore simply a partial, non-exhaustive list of types of conduct that may result in disciplinary action, up to and including the possibility of immediate termination.
• Unexcused and/or repeated tardiness or absenteeism.
• Mishandling, misappropriation or unauthorized removal or possession of the funds and/or property of CPA and/or any co-worker.
• Violation of any CPA policy, including policies, described in this handbook, as revised from time to time.
• Gambling on CPA property or while on duty.
• Possessing or bringing dangerous or unauthorized materials on CPA property (e.g., guns, knives, or other weapons, hazardous materials or illegal/controlled narcotics or substances), unless otherwise permitted to do so by applicable law. • Falsifying or destroying any CPA records, including timekeeping records. • Engaging in inappropriate conduct toward others.
• Smoking in any form through the use of tobacco products or “vaping” with e-cigarettes in restricted areas on CPA property. Smoking during working hours is permitted outside of the building on rest breaks and meal periods.
• Reporting to or being at work while under the influence of alcohol or unlawful drugs or possessing drugs while on CPA’s premises or while on duty or operating a vehicle or potentially dangerous CPA equipment.
• Falsifying or making erroneous entries or material omissions on an employment application or other CPA record.

SECTION 4: EMPLOYMENT POLICIES & PROCEDURES
Problem Resolution

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A. If an employee has a complaint or question about the employee’s job duties, working conditions, or treatment the employee is receiving, the employee is encouraged to take the following steps to address employee’s concerns:

1. Bring the situation to the attention of employee’s Supervisor and the Director, Human Resources who will then investigate and provide a solution or explanation.

2. If the problem remains unresolved, the employee may present it in writing to the Chief Administrative Officer who will work towards a resolution.

B. This procedure may not result in every problem being resolved to the employee’s satisfaction.

However, CPA values the employee’s input and the employee should feel free to raise issues of concern without fear of retaliation.

Policy Prohibiting Harassment, Discrimination, and Retaliation CPA is committed to providing a work environment that is free of discrimination or harassment of or against our job applicants, contractors, interns, volunteers, or employees by another employee, supervisor, vendor, customer, or any third party. In keeping with this commitment, CPA requires all employees to complete mandatory Harassment Prevention training as required by applicable law. For more information on this training requirement, employees can visit https://calcivilrights.ca.gov/shpt/. Additionally, CPA maintains a strict policy prohibiting all forms of unlawful harassment, discrimination, and retaliation, including sexual harassment and harassment based on actual or perceived race, color, creed, religion, national origin, ancestry, citizenship status, disability, protected medical condition as defined by applicable state or local law, reproductive health decision making, genetic information, marital status, sex or gender (including pregnancy, childbirth, related medical conditions and lactation), gender identity or gender expression (including transgender status), age, military service and veteran status, sexual orientation, or any other characteristic protected by applicable federal, state, or local laws and ordinances (referred to as “protected characteristics”). Further, CPA prohibits discrimination, harassment, and retaliation on the basis of any combination of protected characteristics.

This policy applies to all employees and prohibits harassment and discrimination of employees in the workplace by any person, including nonemployees, such as vendors, independent contractors, and third parties doing business with CPA or with whom an employee comes into contact.

Furthermore, this policy prohibits unlawful harassment in any form, including verbal, physical and visual harassment. It also prohibits retaliation of any kind against individuals who file complaints or who assist or participate in an investigation.

CPA is committed to a workplace free of discrimination, harassment and retaliation. These behaviors are unacceptable in the workplace and in any work-related settings such as remote work settings, business trips and CPA sponsored social functions, regardless of whether the conduct is engaged in by a supervisor, co-worker, client, customer, vendor or other third party. In addition to being a violation of this policy, discrimination, harassment or retaliation based on any protected characteristic as defined by applicable federal, state, or local laws and ordinances also is unlawful.

For example, sexual harassment and retaliation against an individual because the individual filed a complaint of sexual harassment or because an individual aided, assisted or testified in an investigation or proceeding involving a complaint of sexual harassment as defined by applicable federal, state, or local laws and ordinances are unlawful.

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Discrimination Defined. Discrimination under this policy generally means treating differently or denying or granting a benefit to an individual because of the individual’s actual or perceived protected characteristic.

Harassment Defined. Harassment generally is defined in this policy as unwelcome verbal, visual or physical conduct that denigrates or shows hostility or aversion towards an individual based on or because of any actual or perceived protected characteristic or has the purpose or effect of unreasonably interfering with an individual’s work performance or creating an intimidating, hostile or offensive working environment.

Harassment can be verbal (including slurs, jokes, insults, epithets, gestures or teasing), visual (including offensive posters, symbols, cartoons, drawings, computer displays, text messages, social media posts or e-mails) or physical conduct (including physically threatening another, blocking someone’s way, etc.). Such conduct violates this policy, even if it does not rise to the level of a violation of applicable federal, state, or local laws and ordinances. Because it is difficult to define unlawful harassment, employees are expected to behave at all times in a manner consistent with the intended purpose of this policy.

Sexual Harassment Defined. Sexual harassment includes harassment on the basis of sex or gender (including pregnancy, childbirth, related medical conditions and lactation), gender identity or gender expression (including transgender status), and/or sexual orientation. Sexual harassment includes unwelcome conduct, such as unwelcome or unsolicited sexual advances, requests for sexual favors, and other verbal, visual or physical conduct of a sexual nature or which is directed at an individual because of that individuals’ sex or gender (including pregnancy, childbirth, related medical conditions and lactation), gender identity or gender expression (including transgender status), and/or sexual orientation when: (1) submission to such conduct is made an explicit or implicit term or condition of an individual’s employment; (2) submission to or rejection of such conduct by an individual is used as the basis for employment decisions affecting such individuals; or (3) such conduct has the purpose or effect of unreasonably interfering with an individual’s work performance or creating an intimidating, hostile or offensive working environment.

Conduct that violates this policy may take many forms, including but not limited to:
• Verbal conduct, such as whistling, epithets, sexual jokes or comments about a person’s body, sexual prowess, or sexual deficiencies, propositions or suggesting or insulting comments of a sexual nature, comments, inquiries, or gossip about one’s own or someone else’s sex life or sexual activities, derogatory comments, slurs, or unwanted sexual advances, invitations or comments.
• Visual conduct, such as sexually explicit emails or voicemails, obscene or derogatory posters, cartoons, drawings, or gestures.
• Physical conduct, such as assault, leering, touching, pinching, brushing up against someone’s body, uninvited touching of a sexual nature, or blocking normal movement. • Threats and demands to submit to sexual requests in order to keep one’s job or avoid some other loss and offers of job benefits in return for sexual favors. • Conduct or comments consistently targeted at only one gender, even if the content is not sexual.
• Teasing or other conduct directed toward a person because of the person’s gender. • Retaliation for having reported unlawful harassment.

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Retaliation Defined. Retaliation means adverse conduct taken because an individual reported an actual or perceived violation of this policy, opposed practices prohibited by this policy, or participated in the reporting and investigation of discrimination, harassment or retaliation. “Adverse conduct” includes but is not limited to: any action that would discourage or keep an individual from reporting discrimination, harassment or retaliation; shunning and avoiding an individual who reports discrimination, harassment or retaliation; express or implied threats or intimidation intended to prevent an individual from reporting discrimination, harassment or retaliation; and denying employment benefits because an applicant or employee reported discrimination, harassment or retaliation or participated in the reporting and investigation of discrimination, harassment or retaliation.

Reporting Procedures. The following steps have been put into place to ensure the work environment at CPA is free of discrimination, harassment and retaliation. Any employee or other person who believes someone has violated this policy should promptly report the facts of the incident(s) and the names of the individuals involved to the employee’s Supervisor, the Director, Human Resources or to a third party designated by CPA to intake complaints. The complaint may be designated as confidential. If any of these individuals is the person toward whom the complaint is directed, you should contact any higher-level manager in your reporting chain. It is the responsibility of each employee, independent contractor, or other person to immediately report any violation or suspected violation of this policy to one or more of the individuals identified above. Written and verbal complaints will be treated with equal priority. If the employee makes a complaint under this policy and has not received an initial response within five (5) business days, the employee should contact the Chief Administrative Officer immediately.

Supervisors and managers must immediately report any incidents or reports, whether formal or informal, of alleged violations of this policy to the Director, Human Resources.

Investigation Procedures. Upon receiving a complaint, the Director, Human Resources will promptly investigate the facts and circumstances of such claims. A complaint will be designated as confidential, to the extent possible, but cannot be kept completely confidential. CPA will conduct a fair, impartial, thorough and timely investigation by qualified individuals, documenting and tracking for reasonable progress, and timely closing based on the evidence collected.

During the investigation, CPA generally will interview the complainant and the accused, conduct further interviews as necessary and review any relevant documents or other information. Those receiving claims and leading investigations will handle complaints and questions with sensitivity toward those participating.

Upon completion of the investigation, CPA will determine whether this policy has been violated based upon its reasonable evaluation of the information gathered during the investigation. CPA will inform the complainant and the accused of the results of the investigation.

In the event CPA determines that a violation of this policy has occurred, CPA will take steps to ensure a safe work environment for the individuals who experienced the complained-of conduct.

CPA will take corrective measures against any person who it finds to have engaged in conduct in violation of this policy, if CPA determines such measures are necessary. These measures may include, but are not limited to, counseling, suspension, or immediate termination. Anyone, regardless of position or title, whom CPA determines has engaged in conduct that violates this policy will be subject to discipline, up to and including termination. This includes individuals

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engaging in discrimination, harassment, or retaliation, as well as supervisors or managers who fail to report violations of this policy, or knowingly allow prohibited conduct to continue. Individuals who engage in conduct that rises to the level of a violation of law can be held personally liable for such conduct.

Employees should feel free to report claims and participate in any investigation without fear of retaliation of any kind. Employees will not be subject to retaliation for registering a complaint of unlawful harassment, retaliation, or discrimination.

If any employee has questions concerning this policy, please feel free to contact the Director, Human Resources.

Employees should also be aware that the Federal Equal Employment Opportunity Commission (“EEOC”) and various state agencies (e.g., in California, the California Civil Rights Department) investigate and prosecute complaints of prohibited harassment, discrimination and retaliation in employment. If you think you have been harassed or discriminated against or that you have been retaliated against for resisting, complaining, or participating in an investigation, you may file a complaint with the appropriate agency. The nearest EEOC office can be found by visiting the agency website at https://www.eeoc.gov/. Individual sites may also have agency websites that can be found online (e.g., in California, visit https://calcivilrights.ca.gov/), otherwise, the EEOC will have regional offices to serve your area.

Consensual Romantic Relationships between Supervisors and Subordinates A. General. Consensual romantic or sexual relationships between a supervisor and a subordinate can lead to misunderstandings, complaints of favoritism, adverse effects on employee morale, and possible claims of sexual harassment during or after termination of the relationship. As a result, such relationships present existing or potential conflicts that adversely affect efficient operation of CPA. Relationships that present an actual conflict under this section are therefore prohibited.

1. Application. This section shall apply to all CPA employees, regardless of gender or sexual orientation, who have a supervisory role and engage in a romantic or sexual relationship with a subordinate employee or intern.

2. Definition of Conflict. For purposes of this section, a conflict exists if issues related to supervision, safety, security, and/or morale are impacted by a romantic or sexual relationship between a supervisor and a subordinate.

3. Duty to Disclose. If a romantic or sexual relationship exists between a supervisor and a subordinate, the Supervisor shall promptly disclose the relationship to the Director, Human Resources and request a determination as to whether the relationship presents a conflict. The disclosure must identify the names and positions of both employees. An employee’s failure to comply with this section shall be grounds for Discipline up to and including Termination.

4. Determination by the Director, Human Resources. Within five (5) business days of the disclosure, the Director, Human Resources shall issue a written determination as to whether the relationship presents a conflict, the conflict cannot otherwise be resolved, and is thereby prohibited. The Director, Human Resources, in consultation with the Chief Administrative Officer, shall have sole discretion in making the determination.

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5. Resolution of Conflicts. Subject to limitations imposed by applicable provisions of this section, the Director, Human Resources will attempt in good faith to work with the Supervisor and the other employee to consider options to eliminate the conflict, including removing the Supervisor’s authority that created the conflict, reassignment, transfer or voluntary demotion of the Supervisor, or where the Director, Human Resources determines that modification of a Supervisor’s assignment is not feasible, reassignment, transfer or voluntary demotion of a non-supervisory employee. The Director, Human Resources retains discretion to determine how the conflict shall be resolved, including potential resignation or termination.

6. Prohibited On-duty Conduct. Supervisors and subordinates in a romantic or sexual relationship are prohibited from engaging in intimate, physical, or other conduct at work locations or at any time during work hours. Upon termination of a sexual or romantic relationship, both parties must avoid engaging in behavior that adversely affects the working conditions of any CPA employee. All employees are expected to observe appropriate standards of workplace conduct in their interactions with other CPA employees.

7. Complaints. Employees who believe that they have been adversely affected by romantic or sexual relationships between a supervisor and subordinate are encouraged to address their concerns to their Supervisor (if not involved) or the Director, Human Resources.

8. Avoidance of Workplace Conflicts. CPA seeks to prevent misunderstandings, complaints of favoritism, claims of sexual harassment, and employee dissension that may result from personal or social relationships amongst supervisors and subordinates.

Supervisors involved in a romantic relationship with a subordinate must disclose the relationship to the Director, Human Resources. This information will be kept as confidential as possible, however complete confidentiality cannot be guaranteed. For purposes of this provision, a “romantic relationship” will be interpreted broadly. CPA reserves the right to take necessary and appropriate action to resolve any potential conflict of interest arising out of a romantic relationship between or among employees. Depending on the facts of the situation, such action may include reassignment or termination of one or both employees involved.

Media Contact
CPA has established protocols and procedures for dealing with inquiries from outside sources, including any representative of the press or media. The only individuals authorized to communicate with any outside source on behalf of CPA, including any press or media representative, is the Chief Executive Officer and/or the Chief Executive Officer’s designee.

Employees must refrain from answering any questions or providing any information on behalf of CPA, in written or verbal form, to any representative of the press or media. This includes both on and off the record statements on behalf of CPA. Violations of this policy are extremely serious and may result in disciplinary action, including immediate termination.

Employment of Close Relatives
The employment of close relatives in the same area of an organization may cause conflicts of interest and appearances of impropriety. In addition, personal conflicts may impact the working

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relationship of the parties. Although CPA does not prohibit the hiring of close relatives of existing employees, CPA is committed to monitoring situations in which close relatives work in the same area. In the event of an actual or potential problem, CPA’s response may include reassignment or termination of one or both individuals involved. CPA reserves the right to apply this policy to situations where there is a conflict or the potential for conflict because of the relationship between employees, even if no direct reporting relationship or authority is involved. In these situations, CPA will reassign one of the employees within 60 days.

Any exceptions to this policy must be approved by the Director, Human Resources and Chief Administrative Officer. Written justification for the exception must be submitted to Director, Human Resources prior to any employment decisions.

SECTION 5: OFFICE HOURS & TIMEKEEPING
Hours of Work
A. Full-Time employees are required to provide adequate coverage during office hours. CPA office hours are Monday – Friday, 8:30 a.m. to 5:30 p.m. (Pacific time). Full-Time employees shall work a standard work schedule, eight (8) hours per day, exclusive of their meal period. However, because of the nature of CPA’s work, exempt employees may be required to work evenings and occasional weekends depending on various factors, such as workloads, operational efficiency, and staffing needs. In such cases, flexible work schedules will be approved by the employee’s Supervisor and Director, Human Resources, taking into consideration the employee’s work demands. CPA reserves the right to assign employees to jobs other than their usual assignments when required.

B. Staffing needs and operational demands may necessitate variations in starting and ending times, as well as variations in the total hours that may be scheduled each day and week, to the maximum extent permitted by applicable law.

C. Part-time employees will be advised in writing of their expected schedule prior to beginning work and must report to work promptly. Any modifications to Part-time employees’ daily hours will be documented in writing.

D. Meal Periods and Rest Breaks
CPA provides meal and rest breaks in accordance with applicable state and federal law.

Employees are authorized to and permitted to take a 10-minute paid rest break for every four hours worked, or major fraction thereof.

Whenever practicable, non-exempt employees should take their rest breaks near the middle of each four-hour work period. Employees may not accumulate rest breaks or use them to start work late, leave work early, or extend a meal period. Employees will be relieved of all duties during rest breaks. Because rest breaks are paid, employees should not clock out for them. CPA will not retaliate against any employee who reports that their supervisor or manager caused them to miss or take a late rest break.

CPA provides cool down rest and recovery periods as needed to prevent heat illness as required by law for employees who perform work: (1) outdoors when temperatures are 80 degrees or higher; or (2) indoors when temperature are 82 degrees or higher.

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CPA also provides and makes available an unpaid meal period of at least 30 minutes to non-exempt Employees who work more than five (5) hours in a workday (the “First Meal Break”).

CPA provides a second unpaid meal period of at least 30 minutes to employees who work more than 10 hours in a workday (the “Second Meal Break”). Employees may waive their First Meal Break only if they work no more than six (6) hours and elect in writing to waive the First Meal Break or have signed a Meal Break Waiver Form. Employees may waive their Second Meal Break only if they work no more than 12 hours total, have taken their First Meal Break, and elect in writing to waive the Second Meal Break or have signed a Meal Break Waiver Form. Unless waived, employees must begin their First Meal Break before the end of their fifth hour of work (at or before four hours and 59 minutes (4:59) after starting work).

Unless waived, employees must begin their Second Meal Break before the end of their tenth hour of work (at or before nine hours and 59 minutes (9:59) after starting work).

CPA does not pay non-exempt employees for their First or Second Meal Break.

Consequently, employees must record the start and stop times of their First and Second Meal Breaks using the appropriate time-recording procedure. Meal periods cannot be taken at the beginning or end of shifts. First and Second Meal Breaks must be at least 30 minutes in duration. Employees are not allowed to perform any work during their meal breaks and may not work “off the clock.” Employees will be relieved of all duties during meal periods and are allowed to leave the building. If any tasks must be completed during an employee’s required 30-minute meal break, the employee must designate a coworker to complete any such task or may choose to have no appointments scheduled that would interfere with the meal break.

If, for any reason, an employee is not provided a meal period or rest break in accordance with this policy, or if an employee is in any way discouraged or impeded from taking their meal period or rest break or from taking the full amount of time allotted, the employee should immediately notify Human Resources.

To the extent any applicable state provides any greater rights than set forth in this policy, such provisions are incorporated by reference and/or addressed in a supplemental guidance for covered employees.

Timekeeping
A. Time records, including time sheets, represent legal documents that are used to accurately record working time and to compensate employees properly. Accurately recording time worked is the responsibility of every employee. Federal and state laws require the employer to keep an accurate record of hours worked in order to calculate employee pay and benefits.

Hours worked include all time spent on the job performing assigned duties.

1. Non-exempt employees must submit signed or electronically approved bi-monthly timesheets showing hours worked each day. Timesheets must be submitted three (3) business days prior to the end of each pay period.

2. An employee’s tampering, altering, or falsifying time records may result in disciplinary action, up to and including termination. Under no circumstances shall a Supervisor or employee submit a time sheet on behalf of another employee or perform work off the clock.

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3. It is the employee’s responsibility to submit the employee’s time record to certify the accuracy of all time recorded. In doing so, the employee shall attest that the time and hours recorded accurately and fully identify all time worked during the pay period, whether authorized or unauthorized, and that all meal periods to which the employee is entitled have been provided. If all meal periods have not been provided, employees will be required to report to their Supervisor and document the reason for the missed meal period.

B. Supervisors will review and approve the time record for each non-exempt employee before submitting it for payroll processing. In support of that obligation, Supervisors are responsible for monitoring each employee under their direct supervision.

C. Time sheets shall be retained as required under CPA’s record retention policies and as required by California or other applicable law.

D. Lactation Accommodations & Breaks

1. In accordance with California and federal law, employees who wish to express breast milk while at work may request the opportunity to do so. Efforts will be made to accommodate eligible employees by allowing them to express breast milk in a private area. Where an employee has a private office, it may be used for that purpose. Employees can exercise this privilege during their regular rest periods when possible. If it is not possible to exercise this privilege during a regular rest period, employees can arrange with their Supervisor to take additional time or express breast milk at a different time.

The time will be paid when employees use their regular rest periods to express breast milk. Break time that cannot run concurrently with rest and meal periods already provided to the employee is unpaid, to the extent permitted by applicable law.

2. For purposes of this policy, a “private area” is a place other than a bathroom that is near the employee’s work area and that is shielded from view and free from intrusion by other Employees and the public and preferably with a lock. Such space will meet the requirements of state law, including having a surface to place a breast pump and personal items, a place to sit, access to electricity, a sink with running water, and a refrigerator for storing breast milk.

3. Director, Human Resources will consider input from the affected employee but retains sole discretion in identifying a “private area” on a case-by-case basis, to the maximum extent permitted by applicable law.

4. An employee may request an accommodation for lactation breaks by submitting a written lactation accommodation request via email to their Supervisor and/or Director, Human Resources. The Supervisor and/or Director, Human Resources must respond to the employee’s accommodation request within 5 days in writing indicating the approval or denial of the break request. CPA and the employee shall engage in an interactive process to determine the appropriate accommodations.

5. California law expressly prohibits discrimination or retaliation against lactating employees for exercising their rights granted by the ordinance. This includes those who request time to express breast milk at work and/or who lodge a complaint related to the right to lactation accommodations.

6. California Employees have the right to file a complaint with the California Labor Commissioner for any violation of rights provided under California law regarding lactation accommodations.

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Employees can contact Human Resources with questions regarding this policy.

E. Overtime

1. CPA provides compensation for all overtime worked by Non-Exempt employees in accordance with applicable state and federal law. For non-exempt employees, all hours worked in excess of eight (8) hours in one day or forty (40) hours in one week, or for the first eight (8) hours on the seventh consecutive day worked in the same workweek, employees will be paid at one and one-half (1½) times their regular rate of pay.

Compensation for hours worked in excess of 12 hours in a workday and in excess of eight (8) hours on the seventh (7th) consecutive workday worked in the same workweek, will be paid at double the regular rate of pay. There may be exceptions to these standards where allowed by law.

2. For the purposes of calculating overtime, CPA holidays and vacation days are not counted as “time worked” and CPA’s workweek is Sunday 12:00 a.m. through Saturday 11:59 p.m. Any employee who is eligible to receive holiday pay and who works on a holiday observed by CPA shall be paid at their regular rate of pay for any work performed consistent with the relevant state and federal law. Regular overtime rules apply for hours worked on holidays observed by CPA.

3. All overtime must be approved by the employee’s immediate supervisor or the Director, Human Resources. Failure to obtain overtime approval in advance may result in disciplinary action.

4. Exempt employees may have to work hours beyond their normal schedules, as work demand requires. No overtime compensation will be paid to exempt employees pursuant to applicable federal and state wage and hour law. Rather, exempt employees are paid a pre-determined salary that is intended to fully compensate them for all hours worked. As a general rule, an exempt employee’s gross salary is not subject to pay changes due to actual number of hours worked in a pay period. However, when an exempt employee has exhausted all vacation and misses additional full days off work for personal reasons, deductions may be made consistent with all applicable state and federal laws.

F. Holidays
Regular Full-Time Position employees will receive the following paid holidays:
• New Year’s Day (January 1)
• Martin Luther King, Jr. Day (third Monday in January) • President’s Day (third Monday in February)
• Cesar Chavez Day (March 31)
• Memorial Day (last Monday in May)
• Juneteenth (June 19)
• Independence Day (July 4)
• Labor Day (first Monday in September)

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• Veteran’s Day (November 11)
• Thanksgiving (fourth Thursday in November)
• Day after Thanksgiving
• Christmas Eve (December 24)
• Christmas (December 25)
• New Year’s Eve (December 31)
CPA’s office is closed December 25 through January 1. Exempt employees can complete essential duties remotely with no charge to their vacation time but non-exempt employees should not be performing any work without pay. Essential duties may include but are not limited to checking and responding to email, completing required tasks, (e.g., work necessary to meet a legal or regulatory deadline), and responding to urgent issues that may arise. During this time, employees committed to performing essential duties will not be required to use their vacation time off, as addressed in Section 6. Exempt employees that do not want to perform essential duties must be approved to take leave during this time. Employees on a hybrid work schedule will not be required to report to the office. Any employees required to report to the office daily, may still be required to report to the office.

If a holiday falls on a Saturday or Sunday, it will be observed on the preceding Friday or the following Monday. Holiday observance will be announced in advance.

SECTION 6: LEAVE
Leaves of Absence and Time Off
A. The Leave section outlines the policies and procedures for requesting and managing time away from work, including paid and unpaid leave. This section is designed to ensure compliance with applicable federal, state, and local laws while supporting employees’ needs for personal, medical, and family obligations. It includes information on vacation, sick leave, family and medical leave, and other leave types, promoting a clear understanding of available benefits and expectations
B. Following the end of any absence or time off, employees who do not return to work on the originally scheduled return date or otherwise request in advance an extension of the agreed upon return date with appropriate documentation may be deemed to have voluntarily terminated employment with CPA. For purposes of approved leaves of absence, unless otherwise provided by law, failure to notify CPA of (1) the ability to return to work when it occurs or (2) continued absence from work because leave must extend beyond the maximum time allowed may be deemed a voluntary termination of employment with CPA, unless an employee is otherwise entitled to other leave or time off pursuant to applicable law.

Vacation
A. Vacation time off with pay is available to eligible employees to provide opportunities for rest, relaxation, and personal pursuits. Employees are encouraged to use their available vacation