Shasta Lake City Council
July 2, 2024

CITY COUNCIL MEETING AGENDA July 2, 2024

CITY OF SHASTA LAKE

CITY COUNCIL

MEETING AGENDA
July 2, 2024
6:00 P.M.

Shasta Lake City Council Chambers
4488 Red Bluff Street  Shasta Lake, CA 96019
Mayor: Janice Powell
Vice Mayor: Tena Eisenbeisz
Council Members: Justin Jones, Pamelyn Morgan, Greg Watkins

OTHER WAYS TO PARTICIPATE IN THE MEETING
• Watch a livestream of the meeting online or view the recording any time after the meeting concludes at the following: cityofshastalake.org/meetings • Submit public comment electronically before the meeting to:
[email protected]. Public comment by email will be read into the record during consideration of the item the comment addresses. Each public comment will be limited to three minutes of reading. Include the item number you are commenting on in the subject line of the email. Once the vote has taken place on an item, no additional public comments will beaccepted.
• Submit public comment by mail addressed to City Clerk, City of Shasta Lake, PO Box 777, Shasta Lake, CA 96019. Mailed comments must be received one day prior to the meeting to be included.

1.0 CALL TO ORDER – REGULAR MEETING:

1.1 Call to order (please place electronic devices on silent)

1.2 Statement for the record of Council Members present or absent

1.3 Pledge of Allegiance

1.4 Invocation

2.0 AWARDS & RECOGNITIONS:

2.1 None

3.0 PRESENTATIONS:

3.1 Shasta Lake Fire Protection District – Nick Pruitt

3.2 Shasta Economic Development Corporation – Rebecca Baer, President/CEO 1 CITY COUNCIL MEETING AGENDA July 2, 2024

4.0 COMMISSION, COMMITTEE, AND OUTSIDE AGENCY REPORTS:

5.0 PUBLIC COMMENT:

This time is set aside for citizens to address the City Council on matters listed on the Consent Agenda as well as other items not included on the Regular Agenda. If your comments concern an item noted on the regular agenda, please address the Council when that item is open for public comment. Each speaker is allocated three (3) minutes to speak. Speakers may not cede their time. Comments should be limited to matters within the jurisdiction of the City. Council discussion or action cannot be taken on items not listed on the agenda other than to receive comments. Speaker forms are available from the City Clerk, 4477 Main Street, Shasta Lake, on the City’s website, or at the back of the meeting hall. If you have documents to present to members of Council, please provide a minimum of seven copies. Pursuant to The Brown Act, the City Council cannot take action on Public Comment Items.

6.0 CONSENT AGENDA:

The items listed under the Consent Agenda are considered routine business and will be voted on together by one motion unless a Council Member requests a specific item to be removed and discussed separately.

6.1 Minutes of the Regular Meeting of June 18, 2024. (pg. 7)

6.2 Payrolls: (pg. 13)
PE 6/22/2024 PD 6/28/2024 $187,625.61

6.3 Checks, E-payments, and wires: (pg. 14)
6/6/2024 $126,590.43
6/14/2024 $322,932.58
6/20/2024 $2,040,700.41

6.4 Discussion and possible action to approve a Professional Services Agreement with the Economic Development Corporation of Shasta County. (pg. 27)

6.5 Discussion and possible action to approve a Resolution accepting the project as complete and authorize the filing of a Notice of Completion (NOC) for the Intertie Pump Station Control Panel Replacement Project – Bid No. 2023-01. (pg. 35)

7.0 PUBLIC HEARINGS:
2 CITY COUNCIL MEETING AGENDA July 2, 2024

7.1 Annual Resolutions for the Shasta Gateway Industrial Park LMD Public Hearing to Levy and Collect on Assessments. (pg. 39)
Discussion and Possible Action to Approve the Following:
a) Resolution Approving the Engineer’s Report for the Shasta Gateway Industrial Park Landscape Maintenance District and the Levy and Collection of Assessments for Fiscal Year 2024/2024.

8.0 REGULAR AGENDA:

8.1 Discussion and possible action to approve a Resolution of “Third Phase Agreement” with Northern California Power Agency to purchase Renewable Energy from the “Grace Orchard Solar” Project. (pg. 69)

9.0 STAFF COMMENTS:

10.0 CITY COUNCIL COMMENTS AND REPORTS:

This is the time set aside for Council Members, who may so desire, to give brief comments or reports concerning City matters. The City Council may not enter into discussion on matters reported. Statements made by individual Council Members should not be interpreted as a statement of the City Council. The City Council only takes action by majority vote. • Brief reports by members of the Council regarding correspondence, events and/or meetings attended, and upcoming meetings/events.
• Suggestions/motions for future agenda items.
• In compliance with Assembly Bill 1234, Council will report on attendance at conferences/meetings/events where expenses are reimbursed by the City.

ADJOURNMENT:

Meetings are broadcast on the Wednesday following the meeting at 6:00 PM and the following Friday at 2:00 PM on Charter Channel 181. Videos of meetings are also available through the City website: www.cityofshastalake.org In Compliance with the Americans with Disabilities Act, if you need special assistance to participate in this meeting, please call (530) 275-7407. Notification 48 hours prior to the meeting is requested to enable the City to make reasonable arrangements to ensure accessibility to this meeting (28 CFR 35.102-35.104 ADA Title II). 3 4
Shasta Lake Fire Protection District
4126 Ashby Ct., Shasta Lake, CA 96019 (530) 275-7474 Fax (530) 275-6502 www.shastalakefpd.org

PREVENTION OFFICER REPORT
Since taking over for Devin, I have been working on weed abatement and outreach efforts to mitigate fire hazards on private property that are potential fire threats across the city. I also attended a variety of classes for the position.
 Weed Abatement: From February to June, 63 notices have been sent out, and there have been many good responses from property owners and a lot of work being done.  Youth Program: Nothing to Report.
 Business Inspections: We are on a temporary pause and will resume after some time with our seasonal firefighters. This break allows the full-time staff to bring the seasonal firefighters up to speed in preparation for the summer months and upcoming fire season.  Fires: From January to June 2024, the district promptly responded to 43 fires both inside and outside the district.
• 5 Vegetation Fires
• 26 Structure Fires
• 9 Vehicle Fires
• 3 Illegal Burn Piles
Respectfully Submitted,
Nicholas C. Pruitt
Nicholas C. Pruitt
Fire Marshal/ Prevention Officer
5 6

CITY OF SHASTA LAKE

CITY COUNCIL MEETING MINUTES

MINUTES OF THE REGULAR MEETING
HELD TUESDAY, JUNE 18, 2024, AT THE
CITY COUNCIL CHAMBERS, 4488 RED BLUFF ST, SHASTA LAKE, CALIFORNIA

1.0 CALL TO ORDER – REGULAR MEETING:

1.1 Mayor Powell convened the regular meeting at 6:05 PM

1.2 Council Members present: Eisenbeisz, Jones, Morgan, Powell, Watkins

1.3 Pledge of Allegiance was led by Mayor Powell

1.4 Invocation

2.0 AWARDS & RECOGNITIONS:

2.1 None

3.0 PRESENTATIONS:

3.1 Heather Mello-Scholtz, Shasta Family YMCA

3.2 Darlene Brown, Shasta Lake Heritage and Historical Society

3.3 Kay Kobe, Shasta Lake Chamber of Commerce

3.4 Kay Kobe, Shasta Lake Library

4.0 COMMISSION, COMMITTEE, AND OUTSIDE AGENCY REPORTS:

4.1 Ann Morningstar, Shasta Mosquito Vector and Shasta Lake Fire Protection District

5.0 PUBLIC COMMENT:

Jim Mark, City of Shasta Lake resident
Dolores Lucero, City of Shasta Lake resident

6.0 CONSENT AGENDA:

6.1 Minutes of the Special Meeting of June 4, 2024.

6.2 Minutes of the Regular Meeting of June 4, 2024.

6.3 Payrolls:

PE 6/08/2024 PD 6/14/2024 $159,970.86

6.4 Checks, E-payments, and wires:
5/30/2024 $1,874,797.76
7 6.5 Monthly Report of Investment Transactions: (pg. 25) LAIF:

May $15,052,278.53
Chandler:

May $35,157,094.60

6.6 Resolution CC 2024-42 Establishing the Appropriation Limitation for Fiscal Year 2023-24.

6.7 Resolution CC 2024-43 Establishing the Appropriation Limitation for Fiscal Year 2024-25.

6.8 Resolution CC 2024-44 Approving and Adopting the Fiscal Year 2024-25 Payrate Schedule for full-time and regular part-time position titles and classifications.

6.9 Resolution CC 2024-45 Accepting changes to the Memorandum of Understanding with the International Brotherhood of Electrical Workers Local 1245.

6.10 Resolution CC 2024-46 Adopting a Workplace Violence Prevention Plan.

6.11 Resolution CC 2024-47 Requesting consolidation for the Municipal General Election on November 5, 2024.

Motion/Vote:

By motion made/seconded (Morgan/Watkins), and carried, all items on the Consent Agenda were approved.

7.0 PUBLIC HEARINGS:

Mayor Powell moved item 7.2 up on the Public Hearings agenda.

Item 7.1 will be heard after item 7.2.

7.2 Approval the Vice Mayor’s recommendations for financial support for outside agencies.

Mayor Powell recused herself from this item and left the Chamber due to a Conflict of Interest.

Vice Mayor Eisenbeisz opened the item.

Public Comment:

Darlene Brown, Shasta Lake Heritage and Historical Society Rose Smith, City of Shasta Lake resident
Dolores Lucero, City of Shasta Lake resident
Cheryle Yednak, Shasta Lake Garden Project
8 Motion/Vote:

By motion made/seconded (Watkins/Morgan), and carried, the item passed unanimously.

Mayor Powell returned to the Chamber and took her seat.

7.1 Resolution CC 2024-48 Adopting a two-year budget for fiscal year 2024-2024 and fiscal year 2025-2026.

Public Comment:

Cheryle Yednak, City of Shasta Lake resident
Financial Support for Outside Agencies
FY 2024-2025 & 2025-2026
Agency
FY 2024-2025
2025-2026

REQUEST
Approved
Funding Amount COMMENTS
American Legion Post 720 2,000 2,000
p
Guard uniforms 2025-2026 - Funds will be used to purchase new tables and chairs for social area
CVHS Sober Grad 1,500 2,000
Sober Grad Donation Class of 2023 & 2024. Funds will be used to purchase food, prizes for each senior and to pay for entertainment.

Central Valley High School Football 2,000 1,500
Purchase equipment needed for our football program and
Youth Sponsorship
Central Valley Youth Falcons 2,000 1,500
Uniforms, Safety equipment, uogrades and upkeep.

Sponsorships for families unable to afford to sign up their children
Central Valley Falcons Cheerleaders 5,000 2,250
Sports needs - Bows, warm up gear, uniforms, poms,
choreographer, music and competition fees
Shasta County Chemical Company 1,000 1,000

Mentoring, and on campus activities throughout the year in collaboration with Public Health, including vaping and
tobacco prevention, traffic safety and underage drinking topics.Funding will help offset cost of educational materials, supplies, nutritional snacks, and incentive items for students oneSAFEplace (Shasta County Women's Refuge) 0 0 No Request Shasta Damboree 8,000 8,000
Cost of insurance, advertising and the benefit to the City of Shasta Lake of promotional pieces and quality events this year
Shasta Damboree Advertisement 1,000 1,000 Advertising
Shasta Dam Area Little League 2,000 1,500
Build a new covered batting cage and provide continued field improvement. Help with keeping registration fees lower for families. Helps pay for families unable to afford to enroll Shasta Gateway Library 10,000 5,000
$1 per year lease to the City/free utilities. Cover cost for insurance, internet, expanded services suvh as educational tutoring in reading with a paid independent contractor, new computer chairs and misc. office equipment
Shasta Family YMCA 8,000 3,000 May Free Learn to Swim Lesson Program Shasta Lake Chamber of Commerce 10,000 5,000
$1 per year lease to the City/free utilities. Funding will be used to foster our events in the City of Shasta Lake
Flightpath Disc Golf 250 250
Acquire a curriculum created by EDGE, a proven Disc Golf teaching organization
Shasta Lake Garden Project 1,500 1,500
Maintain gardens in the middle of SDB, Shasta Dam
Worker's Park, Native Garden and various other public
areas. Fence dividing the Hybrid Rose area needs replacing.

Shasta Lake Heritage/Historical 4,500 3,400
$1 per year lease to the City/free utilities. $1,000 towards Insurance Coverage. $400 for the Community Center fee for Holiday Community Bazaar and to help defray cost of new computers
Shasta Lake Lions Club 4,000 2,500 Veterans Day Parade and the 911 Service Youth Violence Prevention (Youth Options Shasta) 1,750 1,750 Youth Violence Prevention Programs TOTALS 64,500 43,150
$ 50,000 $50,000 FY24-25 / FY25-26 Proposed Budget Per FY Over/Under $ 6,850
9 Dolores Lucero, City of Shasta Lake resident
Motion/Vote:

By motion made/seconded (Morgan/Eisenbeisz), and carried, the item passed unanimously.

7.3 Annual Resolutions for the Shasta Gateway Industrial Park LMD Intent to Levy and Collect on Assessment District. (pg. 461)
Discussion and Possible Action to Approve the Following:
a) Resolution CC 2024-49 Initiating Proceedings for the Levy and Collection of Assessments Commencing in fiscal Year 2024-25 of the Shasta Gateway Industrial Park Landscaping Maintenance District and ordering the preparation of an Engineer’s Report in connection herewith.
b) Resolution CC 2024-50 Preliminarily Approving the Engineer’s Report Regarding Shasta Gateway Industrial Park Landscaping Maintenance District and the Levy and Collection of Assessments Commencing with fiscal year 2024-25.
c) Resolution CC 2024-51 Declaring the City’s Intention to Order the Levy and Collection of Assessments Commencing in fiscal year 2024-25 of the Shasta Gateway Industrial Park Landscaping Maintenance District and Appointing a Time and Place for the Public Hearing Protests.

Public Comment:

Dolores Lucero, City of Shasta Lake resident
Motion/Vote:

By motion made/seconded (Eisenbeisz/Morgan), and carried, the item passed unanimously.

8.0 REGULAR AGENDA:

8.1 None

9.0 STAFF COMMENTS:

10.0 CITY COUNCIL COMMENTS AND REPORTS:

ADJOURNMENT:
10 With no further business, Mayor Powell adjourned the meeting at 8:45 pm. _________________________________
CHARITY TATLOW, Deputy City Clerk
11 12
6/25/2024 1:51:31 PM Page 6 of 6
Payroll Check Register
City of Shasta Lake Report Summary
Pay Period: 6/9/2024-6/22/2024
Packet: PYPKT00553 - PE 6.22.2024
Payroll Set: City of Shasta Lake - 01
Type
8 Count
0 7,853.79

0.00 Regular Checks
Manual Checks
0 0.00
0 0.00
Amount
94 179,771.82
Total 102 187,625.61
Reversals
Voided Checks
Direct Deposits
13 14
15 16
17 18
19 20
21 22
23 24
25 26
Report and Recommendations 6.4 Reviewed and Approved

City Manager

AGENDA ITEM
City Council
TO: Mayor and City Council Members
FROM: Jessaca Lugo, City Manager

DATE: July 2, 2024
SUBJECT: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

SHASTA LAKE APPROVING A PROFESSIONAL SERVICES

AGREEMENT WITH THE ECONOMIC DEVELOPMENT

CORPORATION OF SHASTA COUNTY (EDC)
FILE NO.: E-030-120-575

RECOMMENDATION
Staff recommends that the City Council consider approving a Professional Services Agreement (PSA) with the EDC of Shasta County in an amount not exceeding $27,500 annually and authorize the City Manager to execute the attached agreement.

BACKGROUND
The Economic Development Corporation of Shasta County (Shasta EDC) represents the Cities of Shasta Lake and Redding and the County of Shasta. Its goal is to facilitate the location or start of businesses in our region and stimulate the local economy. Shasta EDC aims to provide resources and information to current businesses who are focused on growth which in turn, will grow our region’s economy.

The Shasta EDC works to best represent the region when attracting new businesses and talent. They work in five primary areas: branding the area as Business-Friendly and a great place to live, recruiting new businesses, helping retain and expand current businesses, growing airline travel, and helping scalable startup development.

EDC’s recruitment efforts over the years have produced results that sustain members of the City of the Shasta Lake business community, including Fresenius Medical, Premier Brand Meats, and Knauf Insulation. EDC continues to present City of Shasta Lake building sites and buildings suitable to inquiring companies. 27 The Shasta EDC will continue efforts to attract new business by promoting the region’s unique and superior quality of life that business owners and employees experience in our region. Our marketing efforts in FY 24-25 will be to market to new businesses whose owners and employees enjoy easy access to outdoor recreation and natural beauty. We also intend to continue to promote the differentiating factors related to doing business in the North State. The Shasta EDC continues to be as strategic as possible and look for every available solution to make our area as attractive as possible for new investment.

In FY 24-25 Shasta EDC will support the efforts of professional services and medical providers in our region by assisting with recruiting efforts. In the late fall, the EDC will launch a pilot program which will help employers showcase the best of our region to potential employees based on their interests. Existing resources which are currently used by the EDC to showcase cost of living and other decision making factors will be available to employers to use in their recruiting efforts. Additionally, the EDC will provide customized tours for prospective employees during their visit(s) to the region. These personal and customized interactions are intended to help employers overcome barriers to hiring by showcasing the abundant positive attributes of our region, which are not always immediately apparent.

Regional local agency contribution is as follows:

Jurisdiction Current Annual Commitment
County of Shasta $100,000
City of Redding $161,000
City of Shasta Lake $27,500
In addition to local government contributions, the private sector also funds operations of the EDC. The EDC is looking to expand its investor base and secure higher levels of funding from current investors, both public and private to fund marketing programs and startup development. The EDC will host two regional events in FY 24-25 that support a healthy startup ecosystem in our region. Startup Games is a popular annual fall event, and in the Spring of 2025, the EDC will resurrect our annual Venture Conference.

The EDC is the only agency in Shasta County that is making outreach to businesses looking to expand or relocate, and staff feels it essential to maintain a coordinated, collaborative, and continued presence in business recruitment.

FISCAL IMPACTS:

FY 2025 - $27,500 from the General Fund
FY 2026 - $27,500 from the General Fund

ATTACHMENTS
Resolution; EDC Scope of Services

DISTRIBUTION
City Council
28 RESOLUTION CC 2024-XX

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SHASTA LAKE

APPROVING A PROFESSIONAL SERVICES AGREEMENT WITH THE ECONOMIC

DEVELOPMENT CORPORATION OF SHASTA COUNTY (SHASTA EDC)
WHEREAS, the City of Shasta Lake supports the Economic Development Corporation of Shasta County (Shasta EDC) to promote business growth in Shasta County; and WHEREAS, the Shasta EDC’S role is to retain and expand the primary industry base of our regional economy; and
WHEREAS, virtually all of the industrial properties in the City of Shasta Lake are target areas for the Shasta EDC; and
WHEREAS, the Shasta EDC is a 501(c)(3) public benefit corporation focused on growing, diversifying and maintaining a balanced economy, leading to more economic stability and sustainability for our region.

WHEREAS, the City of Shasta Lake supports business growth within the City and greater Shasta County Region; and
WHEREAS, the City of Shasta Lake has approved an item in the two-year budget in the amount of $27,500 for a contract with the Economic Development Corporation of Shasta County.

NOW, THEREFORE, BE IT RESOLVED that the City of Shasta Lake hereby authorizes the City Manager to sign a professional services agreement with the Shasta EDC for fiscal year(s) 2024-2025 and 2025-2026, at a fee not to exceed $27,500 each year.

PASSED, APPROVED, AND ADOPTED this 2nd day of July, 2024, by the following vote:

AYES:

NOES:

ABSENT:

JANICE POWELL, Mayor
ATTEST:

CHARITY TATLOW, Deputy City Clerk
29 EXHIBIT
A

SCOPE OF SERVICES
The 2024/2025 professional services agreement between the City of Shasta Lake and the Economic Development Corporation of Shasta County will fund portions of the Shasta EDC comprehensive economic development activities. This plan is created to improve primary industry employment in Shasta Lake through the attraction of new industry, the expansion and retention of existing industry, and fostering the growth of scalable startups in technology and primary industry.

The Economic Development Corporation of Shasta County leverages public and private sector funding to accomplish an affordable, aggressive and dynamic program.

EDC Business Plan Element Descriptions
Regional Branding
Brand Shasta County as a great place to “Live, Work and Recreate”

1. Market the area as a great place to live by building content that highlights a superior and unique quality of life enjoyed by business owners and residents of our region.

2. Create content to feed digital and social media that will help bolster our areas search engine optimization (SEO) and digital image.

3. Work with partners such as Visit Redding, Choose Redding, Shasta Cascade Wonderland Association, and others, to leverage content that is being created to target talent that is looking to relocate.

4. Promote the region to targeted areas throughout the state to attract owners and employees who can benefit the most from regional resources.

Company Recruitment
Development of a comprehensive business attraction program which focuses on the following:

1. Continue to build an online network of Corporate Real Estate VP’s, Site Selectors and Commercial Realtors, that we can leverage relationships with to find companies to market the region to.

2. Maintain a contact system to share information with the aforementioned network.

3. Continue to refine our target profile of companies whose needs align with the resources available in the Shasta region and be proactive in our marketing efforts to companies who fit the target profile.
30

4. Continue to work closely with the California Governor’s Office of Business and Economic Development to leverage our assets and recruit businesses to Shasta County.

5. Leverage the networks of our existing businesses to develop new prospects.

6. Local Marketing: In recognition that much of our lead creation comes from local connections we will continue to expand our local electronic marketing to keep the community aware of the EDC and the awareness that this is a community project.

Business Retention and Expansion
The EDC will work to ensure the retention and expansion of existing primary industries by maintaining or expanding their connection with a network of resources, focusing on the following:

1. Provide guidance regarding services available to existing businesses from our Shasta County economic partners – labor, finance, technology, and local government.

2. Continue to keep in contact with and monitor manufacturers to assess regional economic change and identify needs.

3. Maintain relationships and leverage resources with local business groups such as the Chambers of Commerce, Shasta Builders Exchange, Shasta Association of Realtors and Shasta Cascade Wonderland Association.

4. Attend International Economic Development Council national conference, or other IEDC conferences focusing on topics of interest to our area, to study what other EDC’s are doing to stay competitive in business retention and attraction.

5. Provide resources to local businesses who want to grow.

Entrepreneurial Development
Build the infrastructure for an Entrepreneurial Ecosystem in our region to create successful manufacturing and technology startups, leading to job creation, by focusing on the following:

1. Continue to develop and refine a start-up development program by identifying support resources already available and developing resources needed, working with Startup Redding, and other partners that share our objectives.

2. Identify and connect with entrepreneurs and start-ups by having regularly scheduled opportunities for “pitching” as well as mentoring as may be required.

Connect startups with other subject matter experts as may be required.

3. Monitor and maintain communication with local Angel Group and developing supporting, collaborative processes to hasten the growth of startup companies.

4. Develop and maintain start-up communication programs - newsletter, Facebook and other social media as appropriate and effective.
31

5. Continue to hold Venture Conference to recruit and highlight regional startups looking for funding and help connect them with capital.

Competitive Vitality
Maintain maximum competitiveness for our region by ensuring business has access to the resources to help them thrive. These resources include:

1. Capital Resources: Maintain a pool of financial resources such as SBA and Revolving fund financing, local banks, and entrepreneurial funds.

2. Workforce Development: Ensure that there is an adequate supply of skilled workers by coordinating local educational institutions with businesses to develop training initiatives.

3. Regulatory Assistance: Assist companies with all levels of government regulatory needs by maintaining strong relationships with state and federal governing offices and local jurisdiction department heads.

4. Business and Tax Incentives: Monitor and maintain a data base of incentives and tax rebates and ensure businesses are aware of these incentives.

5. Technology: Identify the technology infrastructure that is in place and work toward expanding that infrastructure to meet the needs of existing companies in the future.

6. Special Projects: Invest in community projects, programs and studies that support EDC’s goals including working with Public and Private sectors to bring additional sites into production, enhancing air service and assisting jurisdictions in obtaining and implementing economically based grants.

Airline Passenger Service Enhancement

1. Undertake efforts to add airline destinations through participating in community meetings, strategic and planning conference calls and airline headquarter meetings.

2. Assist with marketing and promotional efforts related to airline passenger services.

3. Assist with the planning, management, and execution of marketing pursuant to the Small Community Air Service Development Plan grant in support of United Airlines plan to add additional regional jet passenger service between Redding and Denver.

4. Manage the Revenue Guarantee agreements with the investors. Coordinate such with Redding Regional Airport Management.
32

Priority Projects

1. Focus recruitment efforts on industries that naturally align with our supply chain strengths such as secondary forest products that leverage our abundant natural resources and expanding sawmills.

2. Align the marketing and economic development goals of the entire region and market our strengths as a business friendly and cost-competitive region of California.

3. Assist professional services and medical providers with recruiting qualified talent to our region.

Other General Communication and Reporting:

1. Outreach to businesses to provide information on various local, state, and federal incentives, tax credits/exemptions available.
a. Email to database of local businesses
b. Referral to EDC website page on business resources and incentives

2. Maintain a website for marketing purposes.

3. Maintain a start-up website landing page providing information on resources available, events.

4. Report on the execution of the EDC Business Plan by providing semi-annual reports and periodic presentations to the City Council.

City of Shasta Lake – Specific Activities:

1. Work with City staff to identify best practices and craft incentives that are mutually beneficial to the City and property owners to encourage development.

2. Work with local realtors to develop consistent marketing for properties on Shasta Dam Blvd that encourage opportunities for new businesses.

3. Respond to business inquiries and industry leads related to development referred to EDC by the City of Shasta Lake.

4. Work with Visit Redding to help promote and connect with City of Shasta Lake Specific Initiatives.

5. Assist in defining the audience(s), identify the messaging, create a communication and promotion strategy.

6. Host an annual event with the City of Shasta Lake Chamber of Commerce, developers, investors, real estate agents, and lenders to learn more about investment opportunities and City’s support team and process. 33

7. Consulting with the City of Shasta Lake team on marketing the “Destination” and building a level of collaboration between Shasta Cascade Wonderland, realtors, and the City team.

8. Engaging in meetings with prospective hoteliers or retailers to provide an overview of regional economy, opportunities, and trends.

9. Meet with City of Shasta Lake frequently to identify priorities on above and to ensure that we are all focused on the most important items, “putting first things first.” This will allow us to optimize the joint resources that we have for the maximum result.

10.Work with Redding Rancheria Economic Development Corporation (RREDCO) to coordinate, when possible, on their development activities. 34 Report and Recommendations 6.5 Reviewed and Approved City Manager

AGENDA ITEM
City Council
TO: Mayor and City Council Members
FROM: Will Bond, Public Works Director/City Engineer
DATE: May 21, 2024
SUBJECT: AUTHORIZATION TO FILE A NOTICE OF COMPLETION
FILE NO.:

RECOMMENDATION
Staff requests that the City Council consider accepting the project as complete and authorize the filing of a Notice of Completion (NOC) for the Intertie Pump Station Control Panel Replacement Project – Bid No. 2023-01.

BACKGROUND
On June 20, 2023, the City Council approved resolution CC-2023-40 authorizing the City Manager to enter into a contract with Converse Construction for the purposes of performing the above project.

Staff has determined that the work specified in the contract has been completed and is in substantial conformance with the Plans and Specifications. Therefore, staff recommends that the Council accept the Project and authorize the filing of a Notice of Completion at the Shasta County Recorder’s Office.

FISCAL IMPACTS:

Awarded construction contract: $ 49,567.00
Approved expenditure not to exceed: $ 60,000.00
Total project construction cost: $ 56,106.71
This project was funded through currently budgeted Water Capital Projects (510-340). 35 ATTACHMENTS
Resolution

DISTRIBUTION
City Council
36 RESOLUTION CC 2024-XX
______________________________________________________________________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SHASTA LAKE TO

ACCEPT THE INTERTIE PUMP STATION CONTROL PANEL REPLACEMENT

PROJECT AND AUTHORIZE THE FILING OF A NOTICE OF COMPLETION WHEREAS, the City entered into a contract with Converse Construction for the performance of the Intertie Pump Station Control Panel Replacement Project; and WHEREAS, Converse Construction has completed the project to the satisfaction of City staff.

NOW, THEREFORE BE IT RESOLVED THAT the City of Shasta Lake City Council hereby accepts the Intertie Pump Station Control Panel Replacement Project (2023-01) as complete and authorizes staff to file a Notice of Completion with the Shasta County Recorder’s Office.

PASSED, APPROVED, AND ADOPTED this 2nd day of July, 2024, by the following vote:

AYES:

NOES:

ABSENT:

JANICE POWELL, Mayor
ATTEST:

CHARITY TATLOW, Deputy City Clerk
37 38
Report and Recommendations 7.1 Reviewed and Approved
City Manager

AGENDA ITEM
City Council
TO: Mayor and City Council Members
FROM: Wendy Howard, Finance Director
Jason Peterson, Finance & General Services Manager
DATE: July 2, 2024
SUBJECT: SHASTA GATEWAY INDUSTRIAL PARK LANDSCAPING

MAINTENANCE DISTRICT PUBLIC HEARING
FILE NO.:

RECOMMENDATION
Staff recommends that the City Council conduct a public hearing for the Shasta Gateway Industrial Park Landscaping Maintenance District (LMD), adopting the attached resolution:

1. Approve the Final Engineer’s Report and order the Levy and Collection of Assessments.

BACKGROUND
Shasta Gateway Industrial Park Landscape Maintenance District (hereafter referred to as the “District”), which includes all lots and parcels of land within the non-residential subdivision known as Shasta Gateway Industrial Park that have been determined to receive special benefits from the landscaping improvements installed in connection with these non-residential lots.

Prior to 2024, the Property Owners of Shasta Gateway Industrial Park paid for landscaping directly to a landscaping company. In 2023, the Property Owners approached the City, requesting the City take over maintenance and collection of landscaping costs, thus forming the district in 2024.

The City Council formed the District to levy and collect annual assessments on the Shasta County (the “County”) tax rolls to provide ongoing funding for the costs and expenses required to service and maintain the landscaping improvements and appurtenant facilities that are necessary and essential requirements for the properties within the District. 39 ENGINEER’S REPORT
The Resolutions approving the Engineer’s reports are clear that the Council is preliminarily approving the Reports. As allowed by state code, the Engineer’s Report may be amended at any time prior to the public hearing.

Landscaping and Lighting District
The District was formed Pursuant to the provisions of the Landscaping and Lighting Act of 1972, being Part 2 of Division 15 of the California Streets and Highways Code. The attached Engineer’s Report describes the District, the improvements, and the maximum amount for assessments to be levied against the properties commencing in the fiscal year 2024-25 and the proposed applied rate for the fiscal year 2024-25.

The District provides for the continued operation and maintenance of the Landscaping improvements that are directly associated with the development of properties within the District and for the special benefit of those properties. The attached Engineer’s Report provides items that may be included.

Equivalent Benefit Units (EBU) application by land for commercial — This land use is defined as property designated for either commercial or industrial use. This type of property receives greater benefit than Single-Family or Multi-Family property due to typically larger lot sizes in relation to residential properties. With typical SFR lot sizes in the City at 0.25 acres, the Commercial land use type is assessed at 4.0 EBU per net acre.

Parcels less than 0.25 net acres will be assigned a minimum of 1.0 EBU and there is no maximum net acreage cap. The District consists of a total of 125.88 EBU’s.

The maximum amount of the per-parcel assessment for this District is $435.71 per EBU.

The applied rate for fiscal year 2024-25 is the maximum $435.71 per EBU, an increase from the $420.30 per EBU assessed for the prior fiscal year 2023-24.

Commencing in each fiscal year thereafter, the maximum assessment rate established in the previous year will be adjusted by the greater of:

1. The percentage change in the Consumer Price Index reported by the local Consumer Price Index (CPI) of all Urban Consumers, San Francisco-OaklandSan Jose Area; or Three percent (3%).

FISCAL IMPACTS:

None
ATTACHMENTS:
• Resolution for the Shasta Gateway Industrial Park Landscaping Maintenance District (LMD). Approving the Engineer’s Report, Levy, and Collection of Assessments for Fiscal Year 2024-25
• Engineer’s Reports on the Landscaping Maintenance District (LMD) 40 • Landscaping Maintenance District (LMD) Preliminary Assessment Roll DISTRIBUTION:

City of Shasta Lake City Council
41 RESOLUTION NO. 2024-_____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SHASTA LAKE, COUNTY OF SHASTA, STATE OF CALIFORNIA, APPROVING THE ENGINEER’S

REPORT FOR SHASTA GATEWAY INDUSTRIAL PARK LANDSCAPE

MAINTENANCE DISTRICT AND THE LEVY AND COLLECTION OF ASSESSMENTS WITHIN SUCH DISTRICT FOR FISCAL YEAR 2024/2025 AND CONFIRMING DIAGRAMS AND ASSESSMENTS PURSUANT TO THE PROVISIONS OF PART 2 OF DIVISION 15 OF THE CALIFORNIA STREETS AND HIGHWAYS CODE AND AS

PROVIDED BY ARTICLE XIII D OF THE CALIFORNIA CONSTITUTION WHEREAS, the City Council by its Resolution No. 2024-_____ initiated proceedings, and by its Resolution No. 2024-_____ declared its intention to levy annual assessments for and to amend the boundaries of the Shasta Gateway Industrial Park Landscape Maintenance District (hereinafter referred to as the "District"), and to levy and collect assessments against lots and parcels of land within such District pursuant to the provisions of the Landscaping and Lighting Act of 1972, Part 2 of Division 15 of the California Streets and Highways Code, commencing with Section 22500 (hereinafter referred to as the “Act”), to pay for the costs and expenses of operating, maintaining and servicing ornamental structures, landscaping and appurtenant facilities located within public places within the boundaries of the District; and WHEREAS, the Engineer selected by the City Council has prepared and filed with the City Clerk, and the City Clerk has presented to the City Council, a report in connection with the annual levy of assessments against lots and parcels of land within the District, and the City Council did by previous resolution approve such report (hereinafter referred to as the “Engineer’s Report”); and
WHEREAS, the City Council desires to levy and collect assessments against lots and parcels of land within the District for the fiscal year commencing July 1, 2024 and ending June 30, 2025, to pay for the costs and expenses of operating, maintaining and servicing turf, ground cover, shrubs, trees, irrigation, lighting systems, entry monuments, walls, drainage systems, park facilities, and associated appurtenances, located in public places within the boundaries of the District; and
WHEREAS, a mailed ballot election in connection with the levy of assessments within the District was not required in accordance with Article XIII D of the California Constitution.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SHASTA LAKE DOES HEREBY FIND, DETERMINE, RESOLVE AND ORDER AS FOLLOWS:

Section 1. Following notice duly given, the City Council has held a full and fair public hearing regarding its Resolution No. 2024-______, the Engineer's Report prepared in connection with the District and the levy and collection of assessments, and considered all oral and written statements, protests and communications made or filed by interested persons. 42 Section 2. The City Council hereby finds that a majority protest does not exist as defined in Section 4(e) of Article XIII D of the California Constitution with respect to the District. All oral and written protests and objections to the annual levy of assessments for the District and the proposed collection of assessments are hereby overruled by the City Council.

Section 3. Based upon its review of the Engineer's Report, a copy of which has been presented to the City Council and which has been filed with the City Clerk, and other reports and information, the City Council hereby finds and determines with respect to the District included in the Engineer’s Report, that:
(i) the land within the District will be specially benefited by the operation, maintenance and servicing of turf, ground cover, shrubs, trees, irrigation, lighting systems, entry monuments, walls, drainage systems, park facilities, and associated appurtenances, located in public places within the boundaries of the District; and (ii) the District include all lands so specially benefited; and (iii) the net amount to be assessed upon the lots and parcels within the District in accordance with the assessment for the fiscal year commencing July 1, 2024 and ending June 30, 2025 is apportioned by a formula and method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated special benefits to be received by each lot or parcel from the improvements; and (iv) only special benefits are assessed and no assessment is imposed on any parcel, which exceeds the reasonable cost of the proportional special benefit conferred on that parcel.

Section 4. The City Council hereby orders the proposed improvements to be made as set forth in the Engineer’s Report, which improvements are briefly described as follows: to ensure the ongoing maintenance, operation and servicing of local landscaping and street lighting improvements established or installed in connection with development of properties within the District. The improvements may consist of all or a portion of the public landscaped areas, street lighting and appurtenant facilities within and adjacent to the District. These improvements generally include, but are not limited to the materials, equipment, utilities, labor, contract services and incidental expenses necessary for the ongoing maintenance and operation of the landscaping and lighting improvements, amenities and appurtenant facilities within public properties, right-ofways or easements including street lighting and various landscaped parkways, medians, slopes, open space areas, detention basins and related amenities including, but not limited to plantings, trees, monuments or other ornamental features, fencing, sidewalks and other facilities or hardscapes constructed and installed as part of the development plans and agreements approved for the development of the lots and parcels within the District.

Section 5. The City Council hereby confirms the diagrams and assessments set forth in the Engineer's Report. The maintenance, operation and servicing of the ornamental structures, landscaping and appurtenant facilities shall be performed pursuant to law. Commencing with fiscal year 2024/2025, the County Auditor of Shasta County shall enter on the County Assessment Roll opposite each lot or parcel of land the amount of the assessment, and such assessments shall then be collected at the same time and in the same manner as the County taxes are collected. After collection by the County, the net amount of the assessment after deduction of any compensation due the County 43 for collection shall be paid to the City Treasurer. For fiscal year 2024/2025, the City’s representative is hereby authorized and directed to collect such assessments.

Section 6. The assessments are in compliance with the provisions of the Act and Article XIII D of the California Constitution, and the City Council has complied with all laws pertaining to the levy of annual assessments pursuant to the Act and Article XIII D of the California Constitution.

Section 7. The assessments are levied for the purpose of paying the costs and expenses of the improvements described in Section 4, above, for fiscal year 2024/2025.

Section 8. The City Treasurer shall deposit all money representing assessments collected for the Districts to the credit of a special fund known as "Improvement Fund, City of Shasta Lake Shasta Gateway Industrial Park Landscape Maintenance District” and such money shall be expended only for the maintenance, operation and servicing of the ornamental structures, landscaping and appurtenant facilities as described in Section 4 above.

Section 9. The adoption of this resolution constitutes the levy of assessments for the fiscal year commencing July 1, 2024 and ending June 30, 2025.

Section 10. A certified copy of the diagrams and assessments shall be filed in the office of the City Clerk and shall be open for public inspection. ******
I, Charity Tatlow, Deputy City Clerk of the City of Shasta Lake, do hereby certify that the foregoing resolution was duly passed and adopted at a regular meeting of the Shasta Lake City Council held on the _____ day of _______2024, by the following vote:

Ayes:

Noes:

Absent:

Abstain:
____________
Janice Powell, Mayor
City of Shasta Lake
______
Charity Tatlow, Deputy City Clerk
City of Shasta Lake
44 CLERK’S CERTIFICATION TO COUNTY AUDITOR

SHASTA GATEWAY INDUSTRIAL PARK LANDSCAPE MAINTENANCE DISTRICT FOR FISCAL YEAR 2024/2025
(Pursuant to Landscaping and Lighting Act of 1972)
TO THE COUNTY AUDITOR OF THE COUNTY OF SHASTA:

I, Charity Tatlow, hereby certify that the attached document is a true copy of that certain Engineer’s Report, including assessment and assessment diagram, for SGIP LMD, City of Shasta Lake, confirmed by the City Council of the City of Shasta Lake on the_____ day of ______, 2024, by its Resolution No. 2024-_____.

This document is certified, and is filed with you, pursuant to Section 22641 of the Streets and Highways Code.

Dated: _______________
______
Charity Tatlow, Deputy City Clerk
City of Shasta Lake
45 46
27368 Via Industria
Suite 200
Temecula, Ca 92590
T 951.587.3500 | 800.755.6864
F 951.587.3510
www.willdan.com/financial
City of Shasta Lake
Shasta Gateway Industrial Park
Landscape Maintenance District
2024/2025 ENGINEER’S ANNUAL LEVY REPORT
Intent Meeting: June 18, 2024
Public Hearing: July 2, 2024
47 ENGINEER'S REPORT AFFIDAVIT
AFFIDAVIT FOR THE ENGINEER’S REPORT
Shasta Gateway Industrial Park Landscape Maintenance
District
Establishment of Annual Assessments for the:

City of Shasta Lake
County of Shasta, State of California
Tyrone Peter
PE # C 81888
This Report describes the District including the improvements, budgets, parcels, and assessments to be levied for Fiscal Year 2024/2025 as they existed at the time of the passage of the Resolution of Intention. Reference is hereby made to the Shasta County Assessor’s maps for a detailed description of the lines and dimensions of parcels within the District. The undersigned respectfully submits the enclosed Report as directed by the City Council.

Dated this ____________ day of ______________, 2024.

Willdan Financial Services
Assessment Engineer
On Behalf of the City of Shasta Lake
By: ________________________________
Chonney Gano, Project Manager
District Administration Services
By: ________________________________
48 TABLE OF CONTENTS
INTRODUCTION ..........................................................................................................1 I. PLANS AND SPECIFICATIONS.........................................................................4 A. BENEFITING PROPERTIES WITHIN THE DISTRICT...................................4 B. IMPROVEMENTS AND SERVICES.......................................................................4 Landscape Improvements......................................................................................................4 Capital Improvements..............................................................................................................5 II. METHOD OF APPORTIONMENT ......................................................................6 A. BENEFIT ANALYSIS......................................................................................................6 Special Benefit ...........................................................................................................................6 General Benefit ..........................................................................................................................7 B. ASSESSMENT METHODOLOGY..........................................................................8 C. EQUIVALENT BENEFIT UNITS ..............................................................................8 EBU Application By Land.......................................................................................................9 D. ASSESSMENT CALCULATIONS...........................................................................9 E. ASSESSMENT RANGE FORMULA ....................................................................10 III. DISTRICT BUDGET ........................................................................................11 IV. DISTRICT DIAGRAM ..................................................................................... 13 V. ASSESSMENT ROLL..................................................................................... 16 APPENDIX A. 1972 ACT IMPROVEMENTS........................................................ 17 APPENDIX B. NET ACREAGE ............................................................................. 19 49 FY 2024/2025 Shasta Gateway Industrial Park Landscape Maintenance District Page 1

INTRODUCTION
Pursuant to the provisions of the Landscaping and Lighting Act of 1972, being Part 2 of Division 15 of the California Streets and Highways Code (hereafter referred to as the “1972 Act”), and in compliance with the substantive and procedural requirements of the California State Constitution Article XIIID (hereafter referred to as the “California Constitution”), the City Council of the City of Shasta Lake, County of Shasta, State of California (hereafter referred to as “City”), formed and levied special benefit assessments for the district designated as:

Shasta Gateway Industrial Park Landscape Maintenance District (hereafter referred to as the “District”), which includes all lots and parcels of land within the non-residential subdivision known as Shasta Gateway Industrial Park that have been determined to receive special benefits from the landscaping improvements installed in connection with these non-residential lots. This Engineer’s Report (hereafter referred to as the “Report”) has been prepared as required pursuant to Chapter 1 Article 4, commencing with Section 22565 of the 1972 Act.

Prior to 2024 the Property Owners of Shasta Gateway Industrial Park have been paying for landscaping directly to a landscaping company. In 2023 the Property Owners approached the City requesting the City to take over maintenance and collection of landscaping costs. Thus, forming the district in 2024.

The City Council formed the District to levy and collect annual assessments on the Shasta County (the “County”) tax rolls to provide ongoing funding for the costs and expenses required to service and maintain the landscaping improvements and appurtenant facilities that are necessary and essential requirements for the properties within the District. The improvements to be provided by the District and the assessments described herein are made pursuant to the 1972 Act and the substantive and procedural provisions of the California Constitution.

This Report describes the District, the improvements, and the assessments levied against properties in connection with the special benefits that the properties will receive from the maintenance and servicing of the District improvements and facilities commencing in fiscal year 2024/2025. The assessments described herein will provide a funding source (annual assessments) for the continued operation and maintenance of the Landscaping improvements that are directly associated with the development of properties within the District and for the special benefit of those properties.

The budgets and assessments described in this Report are based on the planned improvements and development associated with the Gateway Industrial Park. The budgets described herein, represent an estimate of the direct expenditures, incidental expenses, and fund balances that will be necessary to ensure proper maintenance, servicing and funding needs to support the landscaping improvements that provide special benefit to properties within the District. In the event the property owners want to add additional streetlights or update existing streetlights this will be at the discretion of the property owners and the expense of maintaining the new and/or updated streetlights will revert to the property owners and become a line item in the annual budget. Property Owners and City will discuss any modifications to the District improvements. 50 FY 2024/2025 Shasta Gateway Industrial Park Landscape Maintenance District Page 2 The word “parcel”, for the purposes of this Report, refers to an individual property assigned its own Assessor’s Parcel Number (APN) by the County Assessor’s Office. The County Auditor-Controller uses Assessor’s Parcel Numbers and specific Fund Numbers to identify properties assessed on the tax roll for the special benefit assessments.

Each subsequent fiscal year, a Report shall be prepared and presented to the City Council describing any changes to the improvements, the services, the annual budget and assessments for that fiscal year, and the City Council shall hold a noticed public hearing regarding these matters prior to approving and ordering the levy of assessments for that fiscal year. If the annual budget for the District requires an assessment that exceeds the maximum assessment described herein (as approved by the property owners at the time of the District formation), the new or increased assessment must be confirmed through another property owner protest ballot proceeding before such an assessment may be imposed.

This Report consists of five (5) parts:

Part I
Plans and Specifications: A description of the District boundaries and the improvements associated with the District. The District was formed with a single benefit zone encompassing all properties within the territory identified as Shasta Gateway Industrial Park.

Part II
Method of Apportionment: A discussion of benefits the improvements and services provide to properties within the District and the method of calculating each property’s proportional special benefit and annual assessment. This section also identifies and outlines an Assessment Range Formula that provides for an annual adjustment to the maximum assessment rate that establishes limits on future assessments, but also provides for reasonable cost adjustments due to inflation without the added expense of additional property owner protest ballot proceedings.

Part III
District Budget: An annual cost to operate, maintain and service landscaping improvements related to the properties within the District. This budget includes direct maintenance costs and incidental expenses including, but not limited to, administration expenses and the collection of appropriate fund balances to establish the initial Maximum Assessment Rates approved by the property owners of record. The special benefit assessments are based on an estimate of the overall operation, maintenance and servicing costs minus any costs that are not assessed as special benefit. The assessments for each subsequent year shall be based on the estimated net annual cost for the City to operate, maintain and service the improvements for that fiscal year including the collection of funds in installments for periodic or long-term maintenance activities. The Maximum Assessment Rates (Rates per Equivalent Benefit Unit) identified in the budget of this Report establishes the initial Maximum Assessment Rates for the District in fiscal year 2024/2025 and shall be adjusted annually by the Assessment Range Formula described in the method of apportionment.
51 FY 2024/2025 Shasta Gateway Industrial Park Landscape Maintenance District Page 3 Part IV
District Diagram: A Diagram showing the exterior boundaries of the District is provided in this Report and includes all parcels that will receive special benefits from the improvements. Parcel identification, the lines and dimensions of each lot, parcel, and subdivision of land within the District, are inclusive of all parcels as shown on the Shasta County Assessor's Parcel Maps as they existed at the time this report was prepared and includes all subsequent subdivisions, lot line adjustments or parcel changes therein.

Reference is hereby made to the Shasta County Assessor’s maps for a detailed description of the lines and dimensions of each lot and parcel of land within the District.

Part V
Assessment Roll: The assessment amount for each parcel is based on the parcel’s proportional special benefit as outlined in the method of apportionment and the initial Maximum Assessment Rates established in this Report. The Assessment Roll also provides the assessment amount for each parcel for the fiscal year 2024/2025 based on the method of apportionment and estimated expenses (budget) for fiscal year 2024/2025. 52 FY 2024/2025 Shasta Gateway Industrial Park Landscape Maintenance District Page 4

I. PLANS AND SPECIFICATIONS
A. BENEFITING PROPERTIES WITHIN THE DISTRICT
Shasta Gateway Industrial Park consists of fifteen (15) non-residential lots and one (1) street. The area will include landscaping improvements.

The purpose of the District is to ensure the ongoing maintenance, operation, and servicing of landscaping improvements installed in connection with development of properties within the District. This District will provide the financial mechanism (annual assessments) by which the ongoing operation and maintenance of these improvements will be funded.

The District structure, proposed improvements, method of apportionment and assessments described in this Report are based on current development and improvement plans including all estimated direct expenditures, incidental expenses, and reserves associated with the maintenance and servicing of the improvements.

The District is located within the City of Shasta Lake, generally located east of Ashby Road, and Shasta Gateway Drive in all directions.

B. IMPROVEMENTS AND SERVICES
The purpose of this District is to fund the landscaping and irrigation improvements within the District. The property owners in the District will fund the costs associated of the maintenance and servicing for labor, electrical energy, water, materials, contracting services, administration, and other expenses necessary for the satisfactory maintenance and servicing of these improvements.

Detailed maps and descriptions of the location and extent of the improvements to be maintained by the District are on file with the Public Works Division and by reference are made part of this Report. The net annual cost to provide and maintain the improvements determined to be of special benefit shall be allocated to each property in proportion to the special benefits received from those improvements. The District improvements and services are generally described as
Landscape Improvements
The landscape improvements to be funded by the District assessments is located in the common areas and the median on Shasta Gateway Drive to include sixty-four thousand four hundred (64,400) square feet of ground covering, shrubs, vines, lawn care, and plants; sixty-six (66) irrigated trees; as well as irrigation and drainage systems. The complete maintenance specs are on file with the City.

There are eleven (11) street lighting poles within the Shasta Gateway Industrial Park which the City will continue to fund and maintain.
53 FY 2024/2025 Shasta Gateway Industrial Park Landscape Maintenance District Page 5 Capital Improvements
Description Total Cost
Fiscal Year
2024/2025
Cost
Remaining
Cost(1)
Irrigation Repair $7,885.00 $1,577.00 $6,308.00
Sprinkler
Replacement 8,985.00 1,797.00 7,188.00
Totals $16,870.00 $3,374.00 $13,496.00
(1) Remaining Cost spread over 4 years.
54 FY 2024/2025 Shasta Gateway Industrial Park Landscape Maintenance District Page 6

II. METHOD OF APPORTIONMENT
The 1972 Act permits the establishment of assessment districts by agencies for the purpose of providing certain public improvements, including the acquisition, construction, installation and servicing of landscape improvements and related facilities. The 1972 Act requires that the cost of these improvements be levied according to benefit rather than assessed value:

Section 22573 defines the net amount to be assessed as follows:
“The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefits to be received by each such lot or parcel from the improvements.”
The formula used for calculating assessments reflect the composition of parcels within the District and the improvements and activities to be provided and have been designed to fairly apportion the cost of providing those improvements based on a determination of the proportional special benefits to each parcel, consistent with the requirements of the 1972 Act and the provisions of Proposition 218 and Article XIII D of the California Constitution.

A. BENEFIT ANALYSIS
The improvements provided within the District, for which properties will be assessed have been identified as necessary, desired and/or required for the orderly development of the properties within the District to their full potential, consistent with the development plans.

Special Benefit
The ongoing maintenance of landscaped areas within the District will provide aesthetic benefits to the properties and are intended to provide a more pleasant environment to walk, drive, live, and work. The primary function of these improvements and related amenities is to serve as an aesthetically pleasing enhancement and open space area for the benefit of the immediate surrounding properties and development for which the improvements were constructed and installed, and/or were facilitated by the development or potential development of properties within the District. These improvements are an integral part of the physical environment associated with the parcels in the District and while these improvements may in part be visible to properties outside the District and/or occasionally accessed by the general public, if these improvements are not properly maintained, it is the parcels within the District that would be aesthetically burdened and/or impacted directly by potential environmental issues such as dust, debris, pests, water runoff, erosion, and fire hazards. Thus, the maintenance of these improvements provides advantages to the assessed properties that affect the assessed parcels in a way that is particular and distinct from their effect on other parcels and that real property in general and the public at large do not share.

Collectively these improvements, related amenities, and services which will be funded by the special benefit assessments, enhance the overall use, presentation, enjoyment, 55 FY 2024/2025 Shasta Gateway Industrial Park Landscape Maintenance District Page 7 recreational access, and marketability of the properties, and ensure the long-term costefficiency of services that are obtained through the City provided maintenance (economy of scale).

General Benefit
In reviewing the location and extent of the specific landscaped areas and improvements to be funded by the District assessments and the proximity and relationship to properties to be assessed, it is evident these improvements have been installed as part of the development of properties within the District or are improvements that would otherwise be shared by and/or required for development of those properties. Although the improvements are largely located along Shasta Gateway Drive as well as the median on Shasta Gateway Drive the development and may be visible and/or accessible to the general public, it is evident that the ongoing maintenance of these improvements are only necessary for the appearance and advantage of the properties within the District. It is also evident that these improvements were not required nor necessarily desired by any properties or developments outside of the District boundaries.

In the absence of a special funding, these types of improvements would not have been installed by the developer per the City’s conditions and the City’s maintenance of these improvements would for the most part, be limited to weed abatement (fuel modification areas), rodent control, and erosion control services only. This basic or baseline level of service would typically provide for periodic servicing of the open space areas on an asneeded basis. This baseline level of service would only provide a level of service that was necessary to ensure public safety, essential property protection and potential property damage. However, this baseline level of service results in a far less visually pleasing environment than is created with the enhanced levels of services associated with the regular landscape maintenance that can be provided through the District assessments.

In addition to this baseline level of service, it is recognized that there are indirect or incidental benefits to properties within the District as well as the general public that are associated with regular landscape maintenance services, including minimization of dust and debris, and decreased potential water runoff from the open space areas.

It is also recognized that with the regular maintenance of the improvements, the effort and cost to monitor and address these more indirect issues are reduced to isolated areas and/or less frequent servicing, and these activities generally represent less than two percent (2%) of the overall maintenance costs. Therefore, if the District did not exist and the City had to maintain the area at a minimum level it is estimated that the costs associated with these indirect and incidental benefits would not exceed five percent (5%) of the combined annual expenses for General Maintenance identified in the annual maintenance budget contained in "Part III – The District Budget” of this Report. 56 FY 2024/2025 Shasta Gateway Industrial Park Landscape Maintenance District Page 8

B. ASSESSMENT METHODOLOGY
The method of apportionment for the District calculates the receipt of special benefit from the respective improvements based on the actual or proposed land use of the parcels within the District. The special benefit received by each lot or parcel is equated to the overall land use of the parcel based on the parcel’s actual land use or proposed planned development and is reliant upon the special benefit received from the improvements planned within the District.

To identify and determine the special benefit to be received by each parcel, it is necessary to consider the entire scope of the District improvements as well as individual property development within the District. The costs associated with the improvements shall be fairly distributed among the parcels based upon the special benefit received by each parcel. Additionally, in compliance with Article XIIID Section 4 of the State Constitution, each parcel’s assessment may not exceed the reasonable cost of the proportional special benefit conferred to that parcel. The benefit formula used to determine the assessment obligation is therefore based upon both the improvements that benefit the parcels within the District as well as the proposed land use of each property as compared to other parcels that benefit from those specific improvements.

C. EQUIVALENT BENEFIT UNITS
To assess benefits equitably it is necessary to calculate each property’s relative share of the special benefits conferred by the funded improvements and service. The Equivalent Benefit Unit (EBU) method of assessment apportionment is utilized for this District and establishes a basic unit (base value) of benefit and then calculates the benefit derived by each assessed parcel as a multiple (or a fraction) of that basic unit. The EBU method of apportioning special benefits is typically seen as the most appropriate and equitable assessment methodology for assessment districts, as the benefit to each parcel from the improvements are apportioned as a function of comparable property characteristics which may include but is not limited to land use and property size.

For the purposes of this Engineer's Report, an EBU is the quantum of benefit derived from the various improvements in the District based on the average acres of single-family residential property. The average single-family home in the surrounding area equates to

0.2555 (0.25) acres of land. Thus, the "benchmark" property (the single-family residential parcel) derives one (1) EBU of benefit and would be assigned 1.00 Equivalent Benefit Unit if existed in place of commercial development, as such each net acre of commercial land would be assigned 4.00 EBU per net acre. At a meeting held on January 17, 2024, between the City and the property owners, it was decided to use the original net acres assigned to the original parcel numbers (see Appendix B). In any event the net acres were greater than the gross acres, gross acres were utilized instead of the original net acres assigned.

Pursuant to the 1972 Act, the costs of the District may be apportioned by any formula or method that fairly distributes the net amount to be assessed, among all assessable parcels in proportion to the estimated benefits to be received by each parcel from the improvements. The benefit formula used for the District should reflect the composition of 57 FY 2024/2025 Shasta Gateway Industrial Park Landscape Maintenance District Page 9

the parcels, and the improvements and services provided, to fairly apportion the costs based on special benefit to each parcel.

EBU APPLICATION BY LAND
Commercial — This land use is defined as property designated for either commercial or industrial use. This type of property receives greater benefit than Single-Family or MultiFamily property due to typically larger lot sizes in relation to residential properties. With typical SFR lot sizes in the City at 0.25 acres, Commercial land use type is assessed at

4.0 EBU per net acre. Parcels less than 0.25 net acres will be assigned a minimum of 1.0 EBU and there is no maximum net acreage cap.

Exempt Parcels — This land use identifies properties that are not assessed and are assigned 0.0 EBU. This land use classification may include, but is not limited to, lots or parcels identified as public streets and other roadways (typically not assigned an APN by the County); dedicated public easements, open space areas and right-of-way including greenbelts and parkways; utility right-of-way; common areas, sliver parcels and bifurcated lots or any other property that cannot be developed; publicly owned properties that are part of the District improvements or that have little or no improvement value. These types of parcels are considered to receive little or no benefit from the improvements and are therefore exempt from assessment.

The following table provides a listing of land use types, land use code designations, the Equivalent Benefit Unit factor applied to that land use type, and the multiplying factor used to calculate each parcel’s individual EBU.

Land Use Codes and Equivalent Benefit Units
Property Type Land Use
Code
Equivalent
Benefit Units Multiplier
Commercial COM 4.00 Net Acre
Exempt Parcel XMT 0.00 Parcel
D. ASSESSMENT CALCULATIONS
The total number of Equivalent Benefit Units (EBU’s) is the sum of all individual EBU's applied to parcels that receive special benefit from the improvements. An assessment amount per EBU (Assessment Rate) for the improvements is established by taking the total cost of the improvements and dividing that amount by the total number of EBU’s of all parcels benefiting from the improvements. This Rate is then applied back to each parcel’s individual EBU to determine the parcel’s proportionate benefit and assessment obligation for the improvements.

Total Balance to Levy / Total EBU = Levy per EBU
$54,846.94 / 125.88 = $435.7082
58 FY 2024/2025 Shasta Gateway Industrial Park Landscape Maintenance District Page 10

Levy per EBU x Parcel EBU = Parcel Levy Amount
$435.7082 x 125.88 = $54,846.94
E. ASSESSMENT RANGE FORMULA
Any new or increased assessment requires certain noticing and meeting requirements by law. Prior to the passage of Proposition 218 (California Constitution Articles XIII C and XIII D), legislative changes in the Brown Act defined a "new or increased assessment" to exclude certain conditions. These conditions included "any assessment that does not exceed an assessment formula or range of assessments previously adopted by the agency or approved by the voters in the area where the assessment is imposed." This definition and conditions were later confirmed through Senate Bill 919 (Proposition 218 implementing legislation).

The purpose of establishing an Assessment Range Formula is to provide for reasonable increases and inflationary adjustment to annual assessments without requiring costly noticing and mailing procedures, which could add to the District costs. Commencing with fiscal year 2024/2025, the amount of the assessment for the District may be increased to adjust for increases in labor and material costs. This increase will be based upon the greater of three (3) percent or the annual change in the Consumer Price Index, All Urban Consumers, for the San Francisco-Oakland-Hayward, CA area, as determined by the United States Department of Labor, or its successor, without conducting another mailed ballot election.

The Maximum Assessment is adjusted annually and is calculated independent of the annual budget and proposed annual assessment. Any proposed annual assessment (rate per EBU less than or equal to this Maximum Assessment) is not considered an increased assessment, even if the proposed assessment is greater than the assessment applied in the prior fiscal year.

Although the Maximum Assessment will increase each year, the actual assessment may remain unchanged. The Maximum Assessment adjustment is designed to establish a reasonable limit on assessments. The Maximum Assessment calculated each year does not require or facilitate an increase to the annual assessment and neither does it restrict assessments to the adjusted maximum amount. If the budget and assessment for the fiscal year do not require an increase, or the increase is less than the adjusted Maximum Assessment, then the required budget and assessment may be applied without additional property owner balloting. If the budget and assessments calculated requires an increase greater than the adjusted Maximum Assessment, then the assessment is considered an increased assessment and would be subject to balloting. 59 FY 2024/2025 Shasta Gateway Industrial Park Landscape Maintenance District Page 11 III. DISTRICT BUDGET
The following budget outlines the estimated annual costs to be collected and deemed necessary for the operation, maintenance, and servicing of the improvements for the District. The maximum assessment (Rate per Equivalent Benefit Unit) identified by this budget establishes the initial maximum assessment for the District in fiscal year 2024/2025. This assessment rate shall be adjusted annually by the Assessment Range Formula described in the method of apportionment and collectively this assessment rate and inflationary adjustment will be presented to the property owners of record for approval as part of the balloting process for new or increased assessments in accordance with the provisions of the California Constitution, Article XIII D. 60 FY 2024/2025 Shasta Gateway Industrial Park Landscape Maintenance District Page 12

Shasta Gateway Industrial Park Landscape Maintenance District Levy Component Shasta Gateway Industrial
LMD
Landscape Maintenance $26,340
Landscape Utilities 10,368
Total Direct Costs $36,708
Irrigation Repair $1,577
Sprinkler Replacement 1,797
Total Capital Improvement Project Costs $3,374
Levy Administration and Professional Services $4,500
County Collection Fee 70
City Overhead and Administration 250
Total Administration Costs $4,820
TOTAL DIRECT AND ADMIN COSTS $44,903
Reserve Collection/(Transfer) $9,177
Capital Improvement Fund Collection/(Transfer) 767
General Benefit Contribution 0
General Fund/Other Revenue(Contributions) 0
Total Collections/(Credits) $9,944
Balance to Levy (Budgeted) $54,847
Total Parcels 16
Total Parcels Levied 15
Total Equivalent Benefit Units 125.88
Applied Assessment Rate per EBU $435.7082
Maximum Rate per EBU (Current Fiscal Year) $435.7082
Maximum Rate per EBU (Prior Fiscal Year) $420.3000
Estimated Beginning Reserve Fund Balance $9,177
Reserve Fund Adjustments 9,177
Estimated Ending Reserve Balance $18,354
Estimated Beginning Capital Improvement Fund Balance $6,200 Capital Improvement Adjustments 767
Irrigation Repair Project - 5 Years (4 years remaining) 1,577 Sprinkler Replacement Project - 5 Years (4 years remaining) 1,797 Estimated Ending Capital Improvement Balance $10,341
Note: Totals may not foot due to rounding.
61 FY 2024/2025 Shasta Gateway Industrial Park Landscape Maintenance District Page 13

IV. DISTRICT DIAGRAM
The following District Diagram identifies the area of land within the District to be designated as “Shasta Gateway Industrial Park Landscape Maintenance District”, based on the development and improvement plans for the District, Shasta County Assessor’s Maps, and Shasta County Assessor’s property information as the same existed at the time this Report was prepared. The District includes the parcels located on Shasta County Assessor’s Parcel Map Book 064 Page 440. The combination of this map and the Assessment Roll contained in Part V of this Report constitute the Assessment Diagram for the District. The maximum assessment rate, assessment range formula and the proposed assessment amount for each of the lots and parcels of land within the District, as described herein, shall be presented to the property owners of record for approval or protest in accordance with the provisions of the California Constitution.
62 FY 2024/2025 Shasta Gateway Industrial Park Landscape Maintenance District Page 14

63 FY 2024/2025 Shasta Gateway Industrial Park Landscape Maintenance District Page 16 V. ASSESSMENT ROLL
Parcel identification for each lot or parcel within the District is outlined in the preceding Assessment Diagram and is based on available parcel maps and property data from the Shasta County Assessor’s Office at the time this Engineer’s Report was prepared. A listing of the lots and parcels to be assessed within this District commencing in Fiscal Year 2023/2024, along with the assessment amount for each such lot or parcel is provided below.

If any parcel submitted for collection is identified by the County Auditor-Controller to be an invalid parcel number for the fiscal year, a corrected parcel number and/or new parcel numbers will be identified and resubmitted to the County Auditor-Controller. The assessment amount to be levied and collected for the resubmitted parcel or parcels shall be based on the method of apportionment and assessment rates described in this Report as approved by the City Council. Therefore, if a single parcel is subdivided to multiple parcels, the assessment amount applied to each of the new parcels shall be recalculated and applied according to the approved method of apportionment and assessment rate rather than a proportionate share of the original assessment amount.
64 FY 2024/2025 Shasta Gateway Industrial Park Landscape Maintenance District Page 17 APPENDIX A. 1972 ACT IMPROVEMENTS
As generally defined by the Landscaping and Lighting Act of 1972 and applicable to this District, the improvements and associated assessments may include one or more of the following:
• The installation or planting of landscaping;
• The installation or construction of statuary, fountains, and other ornamental structures and facilities;
• The installation or construction of public lighting facilities including, but not limited to streetlights and traffic signals;
• The installation or construction of any facilities which are appurtenant to any of the foregoing, or which are necessary or convenient for the maintenance or servicing thereof;
• The installation of park/recreational improvements, including, but not limited to the following:
a. Land preparation, such as grading, leveling, cutting, and filling, sod, landscaping, irrigation systems, sidewalks, and drainage. b. Lights, playground equipment, play courts, and public restrooms. c. The acquisition of land for park, recreational, or open-space purposes or any existing improvement otherwise authorized pursuant to this section. • The maintenance or servicing, of any of the foregoing including the furnishing of services and materials for the ordinary and usual maintenance, operation, and servicing of any improvement including but not limited to:
a. Repair, removal, or replacement of all or any part of any improvements; b. Grading, clearing, removal of debris, the installation or construction of curbs, gutters, walls, sidewalks, or paving, or water, irrigation, drainage, or electrical facilities;
c. Providing for the life, growth, health, and beauty of landscaping, including cultivation, irrigation, trimming, spraying, fertilizing, or treating for disease or injury;
d. The removal of trimmings, rubbish, debris, and other solid waste; e. The cleaning, sandblasting, and painting of walls and other improvements to remove or cover graffiti;
f. Electric current or energy, gas, or other illuminating agent for any public lighting facilities or for the lighting or operation of any other improvements; g. Water for the irrigation of any landscaping, the operation of any fountains, or the maintenance of any other improvements.
• Incidental expenses associated with the improvements including, but not limited to:
a. The cost of preparation of the report, including plans, specifications, estimates, diagram, and assessment;
65 FY 2024/2025 Shasta Gateway Industrial Park Landscape Maintenance District Page 18 b. The costs of printing, advertising, and the publishing, posting, and mailing of notices;
c. Compensation payable to the County for collection of assessments; d. Compensation of any engineer or attorney employed to render services; • Any other expenses incidental to the construction, installation, or maintenance and servicing of the improvements;
• Costs associated with any elections held for the approval of a new or increased assessment.
66 FY 2024/2025 Shasta Gateway Industrial Park Landscape Maintenance District Page 19 APPENDIX B. NET ACREAGE
Lot Number
Original Assessor’s
Parcel Number Net Acreage
1 064-440-001 1.49
2 064-440-021 0.63
3 Merged w/2 0.72
4 064-440-004 0.67
5 064-440-005 2.04
6 064-440-017 1.75
7 064-440-007 0.8
8 064-440-008 0.56
9 064-440-009 0.52
10 064-440-010 2.93
11 064-440-026 2.2
12 064-440-025 2.93
13A 064-440-023 2.94
13B 064-440-028 2.51
14 064-440-014 7.68
15 064-440-015 2.58
67 Lot
Number
Original Assessor's
Parcel Number
Assessor's Parcel
Number Owner
Secured
Gross
Acre
Net
Acre EBU Applied Assessment
Maximum
Assessment
1 064-440-001-000 064-440-001-000 EVANS ROCKY LIVING TRUST 2.06 1.49 5.96 $2,596.82 $2,596.82 2, 3, 4 064-440-021-000 &
064-440-004-000 064-440-035-000 LAWSON 2011 TRUST 2.31 2.02 8.08 3,520.52 3,520.52 5 064-440-005-000 064-440-005-000 DORIO FAMILY TRUST ETAL 6.69 2.04 8.16 3,555.36 3,555.38 6 064-440-017-000 064-440-017-000 LAHAR DEVELOPMENT LLC 3.81 1.75 7.00 3,049.94 3,049.96 7 064-440-029-000 064-440-029-000 SHASTA LAKE CITY OF 1.40 0.80 3.20 1,394.26 1,394.27 8 064-440-008-000 064-440-008-000 SHASTA LAKE CITY OF 0.92 0.56 2.24 975.98 975.99 9 064-440-009-000 064-440-009-000 SHASTA LAKE CITY OF 0.84 0.52 2.08 906.26 906.27 10 064-440-010-000 064-440-010-000 MCKENNY NEAL ETAL 3.62 2.93 11.72 5,106.48 5,106.50 11 064-440-026-000 064-440-026-000 RAW INNOVATIONS LLC 3.04 2.20 8.80 3,834.22 3,834.23 12 064-440-025-000 064-440-025-000 TAU WEST LLC 1.98 2.93 7.92 3,450.80 3,450.81 13A 064-440-023-000 064-440-023-000 TAU WEST LLC 5.10 2.94 11.76 5,123.92 5,123.93 13B 064-440-028-000 064-440-028-000 TAU WEST LLC 1.98 2.51 7.92 3,450.80 3,450.81 14 064-440-014-000 064-440-030-000 HULI INVESTMENTS LLC 3.70 2.41 9.63 4,196.96 4,196.98 14 064-440-014-000 064-440-036-000 HULI INVESTMENTS LLC 8.10 5.27 21.09 9,187.96 9,187.98 15 064-440-015-000 064-440-015-000 LIBERTY GATEWAY LLC 3.33 2.58 10.32 4,496.50 4,496.51 Street 064-440-016-000 064-440-016-000 SHASTA DAM P U D 4.83 N/A 0.00 0.00 0.00 Totals 53.71 32.95 125.88 $54,846.78 $54,846.94
*In the event the net acreage is more than the secured gross acreage, City of Shasta Lake
Shasta Gateway Industrial Park Landscape Maintenance District Fiscal Year 2024/2025 Preliminary Assessment Roll
SGIP LMD Fiscal Year 2024/2025 Preliminary Assessment Roll 68 1of1
Report and Recommendations 8.1 Reviewed and Approved

City Manager

AGENDA ITEM
City Council
TO: Mayor and City Council Members
FROM: James Takehara, Electric Utility Director

DATE: July 2, 2024
SUBJECT: APPROVAL OF “THIRD PHASE AGREEMENT” WITH
NORTHERN CALIFORNIA POWER AGENCY (“NCPA”) TO
PURCHASE RENEWABLE ENERGY FROM THE “GRACE
ORCHARD SOLAR” PROJECT
FILE NO.:

RECOMMENDATION:

Staff recommends the City Council adopt a resolution that approves the Third Phase Agreement (“Agreement”) with NCPA to facilitate the purchase of renewable energy from the “Grace Orchard Solar” Project and that authorizes the City Manager to sign and administer the Agreement on the City’s behalf.

BACKGROUND
Through various State laws adopted over the last 30 years, the City is required to purchase a minimum amount of renewable electricity based on its electric Customers’ needs. Under the latest iteration of this so called, “Renewable Portfolio Standard,” or “RPS,” the City must have enough renewable energy for at least 60% of Customers’ needs by 2030. The law adds significant complexity by also requiring at least 65% of the City’s renewable energy be sourced from contracts or ownership arrangements with a term of 10-years or longer and at least 75% of the City’s renewable energy must be located inside or directly connected to powerline assets of a State of California entity.

Fortunately, electric utilities successfully lobbied for certain protections under this law, including one for cost limitations. In short, today’s mandate is that the City must buy enough renewable energy to meet these mandated targets and quotas, provided that the cost of doing so fits under the City’s adopted cost limitation threshold, which is discussed in greater detail in the Fiscal Impact section.
69 The City Council adopted Resolutions CC-22-11 and CC-2022-26 on February 16, 2021 and February 15, 2022, respectively, both authorizing actions that help build the City’s renewable energy portfolio to meet these mandates. These actions were sufficient to fully resolve the City’s anticipated renewable energy quota from 2025-2027 and partially resolve the City’s anticipated needs in 2028 and beyond. Purchases were finalized shortly after these Resolutions were adopted, and staff are now focused on purchasing sufficient renewable resources to address the City’s remaining quota for 2028 and beyond.

The outstanding amount of renewable energy the City must buy under the legal mandate is quite large (see table below). To help facilitate discussions about renewable energy purchases, the approximate size of resource that would be needed to fully offset the outstanding requirement is shown in the right two columns if the City were to pursue a “solar-only” or “geothermal-only” strategy. In other words, City could meet 100% of its outstanding forecasted needs by buying or building a 68 MW solar facility or a 15 MW geothermal facility. By way of comparison, the City’s all-time peak demand for electricity was 38.3 MW. The purpose of these comparison is to help illustrate that multiple purchase decisions and actions are likely needed to reach full compliance with this sizable mandate, and that the mandate is requiring utilities to take on unusual and impractical portfolio positions (i.e., one would not typically buy 68 MW of resource if its all-time peak is 38.3 MW).

Calendar
Years
RPS Mandate
(MWh)
Solar MW, if
met with
Solar-Only
Geo MW, if
met with GeoOnly
2025-2027 0
2028-2030 318,325 60.0 13.5
2031-2033 356,893 68.0 15.0
To address portfolio needs driven by these State mandates, the Electric Department has been busy surveying the market. Aside from regularly discussing market opportunities with potential suppliers and developing potential concepts for resources within City boundaries, staff has engaged in discussions to jointly purchase renewable energy with other municipalities through Joint Powers Agencies. The intent of jointly purchasing renewable resources is to increase the City’s buying power by being part of a larger purchase. Typically, one gains economies of scope and scale, which usually makes more options available for consideration and drives down costs. Specifically, the “Northern California Power Agency,” and “Balancing Authority of Northern California” (“BANC”) have each solicited bids for renewable energy and carbon-free energy supply. While both have prospects, NCPA’s efforts have produced a solar project named, “Grace Orchard Solar” that is ready for consideration.

A summary of Grace Orchard Solar is provided in the table below. City expressed interest in a 5 MW share of this project. As noted above, the City would need 68 MW of solar to reach 100% compliance, so this resource would satisfy about 8% of the City’s projected outstanding need.

Item Description
Developer (Seller) NextEra Energy
70 Technology Solar Photovoltaic, only
Total Power Plant Size (MW) 400 MW
Location Blythe, CA, in Riverside County
Balancing Authority CAISO
NCPA Contract Size (MW) 50 MW
Contract Term 20 years
City Participation Share (MW / %) 5 MW / 10%
City Approx. Annual Energy 8,670 MWh
There would be two contracts required to facilitate this transaction, but the City would be party to only one of these. First, NCPA would contract with a Seller directly under a power purchase agreement (“PPA”). Second, NCPA facilitates the transfer of all rights and obligations of the PPA to the 10 participating NCPA Members through a contract NCPA calls, a “Third Phase Agreement.” For clarity, staff is requesting City Council consideration and possible action on the NCPA Third Phase Agreement, as that is the only contract the City would be party to. However, since the Third Phase Agreement passes through all rights and obligations of the PPA, the PPA is attached to the Third Phase Agreement as an Exhibit.

To summarize, the City has a legal mandate to purchase renewable energy provided that the cost fits within the City’s cost limitation policies. The City’s prior actions have met the City’s anticipated legal mandates for CY 2025-2027. The City’s outstanding need for 2028-2033 is significant, and staff anticipates that multiple purchase decisions and actions will be required to fulfill this need. Staff presents one such decision for City Council consideration under this staff report with a 20-year, 5 MW purchase of the Grace Orchard Solar project, which would be administered through NCPA, and would satisfy about 8% of the City’s outstanding need.

FISCAL IMPACT
There are three major cost components associated with the proposed Third Phase Agreement, two of which should be compared to the City’s cost limitation policy. First, the Third Phase Agreement passes all rights and obligations of the PPA to the 10 Participating Members on a pro-rated basis. Based on the contract price and the expected annual generation, the City’s expected gross cost of the PPA is about $372,400 per year, based on the expected generation share of 8,760 MWh per year.

Second, the generator operates in the CA Independent System Operator’s (CAISO) “balancing authority,” which subjects the power plant to the CAISO’s market rules. In the CAISO, all electricity generation is liquidated at a location-specific market price, which would offset the contract costs noted in the paragraph above. This financial activity occurs as frequently as every 10-minute interval of each day. NCPA has prepared a conservative estimate of the market value of the generation from Grace Solar, and the City’s prorate share is (a credit of) $323,700 per year.

The estimated net cost of the PPA costs and the market value is $48,700 per year, which is consistent with the historic costs incurred by the City to satisfy this legal mandate. This value is based on numerous assumptions to form estimates to aid in the decision-making 71 process. Actual costs and market value will fluctuate based on the actual generation of the resource and market conditions.

As noted earlier, the law provides for a cost limitation provision to prevent a disproportionate impact to electric ratepayers when meeting this legal mandate, which the City incorporated into its renewable energy purchasing policies. Based on the figures discussed immediately above, the total net expected annual cost is less than half the allowable cost threshold defined in the City’s adopted cost limitation policies.

The third cost center includes administration and other miscellaneous contract costs. Any interaction with the CAISO creates a specialized administrative burden to schedule generation daily, to deal with the weekly billing, and to deal with several revisions to those billings that occur over years called, “prior-period adjustments.” Each generation facility must have a single entity designated to perform these tasks, and NCPA will do so on behalf of the 10 Participating Members. NCPA charges for these services on a cost-basis.

City’s allocation of NCPA’s administrative cost for this facility is estimated at $5,000 to $10,000 per year. The contract may also call for cash deposits from the City, which are immaterial.

Lastly, it should be noted that contracts for renewable energy from facilities under development face some risk of repricing. Both the PPA and Third Phase agreements contain provisions discussing this (see sections 2.5 and 8.5, respectively). Staff recommends City Council delegate authority to staff to negotiate and execute contract amendments in a manner consistent with the delegation of authority made under Resolution CC-14-65. Applying those principles here, the attached resolution would authorize the City Manager, or her designee, to also authorize changes to the attached contract provided that the incremental cost of renewable energy attributes are consistent with the City’s approved cost limitation policies.

In summary, the net cost of this proposal is consistent with the City’s current adopted cost limitation policy for renewable energy and historic costs.

ATTACHMENTS
Resolution CC-2024-XX
NCPA Third Phase Agreement – Grace Orchard Solar

DISTRIBUTION
City Council
72 RESOLUTION NO CC-2024-XX

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SHASTA LAKE

APPROVING THE THIRD PHASE AGREEMENT WITH NORTHERN CALIFORNIA POWER AGENCY (“NCPA”) FOR THE GRACE ORCHARD SOLAR PROJECT WHEREAS, the State of California has enacted numerous laws that require electric utilities to incorporate a growing minimum quantity of renewable energy, as defined in law, to their electric portfolios; and
WHEREAS, the City is subject to these mandates and is required to have at least 60% of its Customers’ electricity needs in the form of renewable energy, as defined in law, by 2030, provided that the cost of such resources is consistent with the City’s renewable energy cost limitation policy, among other alternative compliance mechanisms, as provided under law; and
WHEREAS, the City wishes to add cost-effective renewable energy supply to its electric portfolio; and
WHEREAS, the City is a Member of NCPA, a Joint Powers Agency that has extensive experience building and buying power supply for its Members, which allows the City to leverage joint purchasing to lower administrative and direct costs through joint action; and WHEREAS, NCPA issued a market solicitation for renewable energy supply on behalf of its Members, and NextEra Energy, doing business as “Grace Orchard Energy Center, LLC,” submitted a response offering to sell electrical output and environmental attributes associated with a 50 megawatt (MW) portion of a solar photovoltaic facility, the “Grace Orchard Energy Center,” which has been selected for contract by NCPA and ten of its Members; and
WHEREAS, the City finds that the proposal for the Grace Orchard Solar project, using data known and available at this time, appears to help satisfy the City’s obligations under current law and is consistent with the City’s cost limitation provisions; and WHEREAS, the City desires to participate in the NCPA “Third Phase Agreement for Renewable Power Purchase Agreement with Grace Orchard Energy Center, LLC” (“Third Phase Agreement”) with a 5 MW portion of the 50 MW available to NCPA.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Shasta Lake approves the Third Phase Agreement and authorizes the City Manager to execute and administer the Third Phase Agreement on the City’s behalf.

BE IT FURTHER RESOLVED that the City Manager, or designee, is authorized to act on the City’s behalf to implement the Third Phase Agreement, including approving subsequent changes to pricing if the incremental cost of renewable energy attributes is consistent with the City’s cost limitation policies.
73 PASSED, APPROVED, AND ADOPTED this 2nd day of July, 2024, by the following vote:

AYES:

NOES:

ABSENT:

JANICE POWELL, Mayor
ATTEST:

CHARITY TATLOW, Deputy City Clerk
74 THIRD PHASE AGREEMENT
FOR

RENEWABLE POWER PURCHASE AGREEMENT
WITH

GRACE ORCHARD ENERGY CENTER, LLC
75 i

THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT

TABLE OF CONTENTS
Section 1. Definitions ....................................................................................................3 Section 2. Purpose .......................................................................................................10 Section 3. Sale and Purchase of Product ..................................................................10 Section 4. Billing and Payments ................................................................................11 Section 5. Security Deposit Administration.............................................................14 Section 6. Cooperation and Further Assurances.....................................................19 Section 7. Participant Covenants and Defaults .......................................................19 Section 8. Administration of Agreement .................................................................23 Section 9. Transfer of Rights by Participants...........................................................25 Section 10. Term and Termination..............................................................................26 Section 11. Withdrawal of Participants ......................................................................27 Section 12. Settlement of Disputes and Arbitration .................................................27 Section 13. Miscellaneous.............................................................................................27 EXHIBIT A. Project Participation Percentages...........................................................41 EXHIBIT B. PPA..............................................................................................................44 76 1

THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT
This THIRD PHASE AGREEMENT (“this Agreement”) is dated as of ______________, 20__ by and among the Northern California Power Agency, a joint powers agency of the State of California (“NCPA”), and the signatories to this Agreement other than NCPA (“Participants”). NCPA and the Participants are referred to herein individually as a “Party” and collectively as the “Parties”.

RECITALS
A. NCPA has heretofore been duly established as a public agency pursuant to the Joint Exercise of Powers Act of the Government Code of the State of California and, among other things, is authorized to acquire, construct, finance, and operate buildings, works, facilities, and improvements for the generation and transmission of electric capacity and energy for resale.

B. Each of the Participants is a signatory to the Joint Powers Agreement which created NCPA and therefore is a Member.

C. Each of the Participants to this Agreement have executed the Amended and Restated Facilities Agreement, dated October 1, 2014, which establishes the framework under which Project Agreements are created for the development, design, financing, construction, and operation of specific NCPA Projects.
77 2

THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT
D. The Participants desire NCPA to enter into a Renewable Power Purchase Agreement (“PPA”) with Grace Orchard Energy Center, LLC (“Seller”), to purchase Product produced by the Facility for the benefit of the Participants’ customers.

E. Each Participant is authorized by its Constitutive Documents to obtain the Product for its present or future requirements, through contracts with NCPA or otherwise.

F. To enable NCPA to enter into the Renewable Power Purchase Agreement on behalf of the Participants, pursuant to the terms and conditions of the Amended and Restated Facilities Agreement, NCPA and the Participants wish to enter into this Agreement to provide all means necessary for NCPA to fulfill obligations incurred on behalf of NCPA and the Participants pursuant to the Renewable Power Purchase Agreement, and to enable and obligate the Participants to take delivery of and pay for the Product and to pay NCPA for all costs it incurs for undertaking the foregoing activities.

G. Upon full execution of this Agreement, NCPA will enter into the Renewable Power Purchase Agreement on behalf of the Participants, and such Renewable Power Purchase Agreement shall be deemed a NCPA Project by the Commission.

H. Each of the Parties intends to observe the provisions of this Agreement in good faith and shall cooperate with all other Parties in order to achieve the full benefits of joint action.

I. The Parties desire to equitably allocate costs of NCPA’s provision of services under this Agreement among the Participants.
78 3

THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT
J. The Participants further desire, insofar as possible, to insulate other Members who are not Participants, from risks inherent in the services and transactions undertaken on behalf of the Participants pursuant to this Agreement.

NOW, THEREFORE, the Parties agree as follows:

Section 1. Definitions.

1.1 Definitions. Whenever used in this Agreement (including the Recitals hereto), the following terms shall have the following respective meanings, provided, capitalized terms used in this Agreement (including the Recitals hereto) that are not defined in Section 1 of this Agreement shall have the meaning indicated in Section 1 of the Power Management and Administrative Services Agreement, dated October 1, 2014:

1.1.1 “Administrative Services Costs” means that portion of the NCPA administrative, general and occupancy costs and expenses, including those costs and expenses associated with the operations, direction and supervision of the general affairs and activities of NCPA, general management, treasury operations, accounting, budgeting, payroll, human resources, information technology, facilities management, salaries and wages (including retirement benefits) of employees, facility operation and maintenance costs, taxes and payments in lieu of taxes (if any), insurance premiums, fees for legal, engineering, financial and other services, power management services, general settlement and billing services and general risk management costs, that are charged directly or apportioned to the provision of services under this Agreement. 79 4

THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT
Administrative Services Costs as separately defined herein and used in the context of this Agreement is different and distinct from the term Administrative Services Costs as defined in Section 1 of the Power Management and Administrative Services Agreement.

1.1.2 “Agreement” means this Third Phase Agreement, including all Exhibits attached hereto.

1.1.3 "All Resources Bill” has the meaning set forth in the Power Management and Administrative Services Agreement.

1.1.4 “CAISO” means the California Independent System Operator Corporation, or its functional successor.

1.1.5 “CAISO Tariff” means the duly authorized tariff, rules, protocols and other requirements of the CAISO, as amended from time to time.

1.1.6 “Capacity Damages” is defined in the PPA, Section 1.1; that definition is hereby incorporated by reference.

1.1.7 "Commission” has the meaning set forth in the Power Management and Administrative Services Agreement.

1.1.8 “Commercial Operation Date” is defined in the PPA, Section 1.1; that definition is hereby incorporated by reference.

1.1.9 “Constitutive Documents” means, with respect to NCPA, the Joint Powers Agreement and any resolutions or bylaws adopted thereunder with respect to 80 5

THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT
the governance of NCPA, and with respect to each Participant, the California Government Code and other statutory provisions applicable to such Participant, any applicable agreements, charters, contracts, or other documents concerning the formation, operation or decision making of such Participant, including, if applicable, its city charter, and any codes, ordinances, bylaws, and resolutions adopted by such Participant’s governing body.

1.1.10 “Defaulting Participant” has the meaning set forth in Section 7.2.

1.1.11 “Electric System” has the meaning set forth in the Power Management and Administrative Services Agreement.

1.1.12 “Event of Default” has the meaning set forth in Section 7.2.

1.1.13 “Facility” is defined in the PPA, Section 1.1; that definition is hereby incorporated by reference.

1.1.14 “Guaranteed Capacity” is defined in the PPA, Section 1.1; that definition is hereby incorporated by reference.

1.1.15 “Guaranteed Commercial Operation Date” is defined in the PPA, Section 1.1; that definition is hereby incorporated by reference.

1.1.16 “Guaranteed Construction Start Date” is defined in the PPA, Section 1.1; that definition is hereby incorporated by reference. 81 6

THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT

1.1.17 “General Operating Reserve” means the NCPA General Operating Reserve created through resolution of the Commission, as the same may be amended from time to time.

1.1.18 “Installed Capacity” is defined in the PPA, Section 1.1; that definition is hereby incorporated by reference.

1.1.19 “MW” means megawatt.

1.1.20 “MWh” means megawatt hour.

1.1.21 “NCPA” has the meaning set forth in the Recitals hereto.

1.1.22 “New PV Trade Measure Event” is defined in the PPA, Section 1.1; that definition is hereby incorporated by reference.

1.1.23 “Participant” has the meaning set forth in the recitals of this Agreement.

1.1.24 “Party” or “Parties” has the meaning set forth in the preamble hereto; provided that “Third Parties” are entities that are not Party to this Agreement.

1.1.25 “Power Management and Administrative Services Agreement” means the NCPA Power Management and Administrative Services Agreement, dated as of October 1, 2014 between NCPA and the Members who are signatories to that agreement by which NCPA provides Power Management and Administrative Services.

1.1.26 “Product” is defined in the PPA, Section 1.1; “Products” and that definition is hereby incorporated by reference. For the purpose of clarity, Product shall 82 7

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include (i) Facility Energy, and (ii) Green Attributes, including but not limited to, Portfolio Content Category 1 Renewable Energy Credits, as such terms are defined in the PPA, Section 1.1.

1.1.27 “Project” or “PPA” means the Renewable Power Purchase Agreement, dated as of ____________, 20__ between NCPA and Seller, under which NCPA, on behalf of the Participants, purchases Product from the Facility located in Riverside County, California, consisting of a separately metered 50 MWAC section of a larger solar photovoltaic generating facility commonly known as the Grace Solar Project. Upon final execution of the PPA, the Project shall be deemed a NCPA Project in accordance with the Amended and Restated Facilities Agreement. The PPA has been attached to this Agreement as Exhibit B.

1.1.28 “Project Costs” means all costs charged to and paid by NCPA pursuant to the PPA.

1.1.29 “Project Participation Percentage” has the meaning set forth in the Power Management and Administrative Services Agreement, and are set forth in Exhibit A of this Agreement.

1.1.30 “Revenue” means , with respect to each Participant, all income, rents, rates, fees, charges, and other moneys derived by the Participant from the ownership or operation of its Electric System, including, without limiting the generality of the foregoing: (a) all income, rents, rates, fees, charges or other moneys derived from 83 8

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the sale, furnishing and supplying of electric capacity and energy and other services, facilities, and commodities sold, furnished, or supplied through the facilities of its Electric System; (b) the earnings on and income derived from the investment of such income, rents, rates, fees, charges or other moneys to the extent that the use of such earnings and income is limited by or pursuant to law to its Electric System; (c) the proceeds derived by the Participant directly or indirectly from the sale, lease or other disposition of all or a part of the Electric System; and (d) the proceeds derived by Participant directly or indirectly from the consignment and sale of freely allocated greenhouse gas compliance instruments into periodic auctions administered by the State of California under the California Cap-and-Trade Program, provided that such proceeds are a permitted use of auction proceeds, but the term Revenues shall not include (i) customers' deposits or any other deposits subject to refund until such deposits have become the property of the Participant or (ii) contributions from customers for the payment of costs of construction of facilities to serve them.

1.1.31 “Scheduling Protocols” means the applicable provisions of the Amended and Restated Scheduling Coordination Program Agreement, and any other contractual or other arrangements between NCPA and the Participants concerning the scheduling, delivery and metering of the Renewable Power Purchase Agreement. 84 9

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1.1.32 “Security Deposit” means the account established by NCPA and funded by the Participants in accordance with Section 5, the funds of which are available for use by NCPA in accordance with the terms and conditions hereof.

1.1.33 “Seller” means Grace Orchard Energy Center, LLC, as set forth in Recital D of this Agreement, or as otherwise set forth in the PPA.

1.1.34 “Term” has the meaning set forth in Section 10.

1.1.35 “Third Party” means an entity (including a Member) that is not Party to this Agreement.

1.1.36 “UFLPA/WRO Restraint” is defined in the PPA, Section 1.1; that definition is hereby incorporated by reference.

1.2 Rules of Interpretation. As used in this Agreement (including the Recitals hereto), unless in any such case the context requires otherwise: The terms “herein,” “hereto,” “herewith” and “hereof” are references to this Agreement taken as a whole and not to any particular provision; the term “include,” “includes” or “including” shall mean “including, for example and without limitation;” and references to a “Section,” “subsection,” “clause,” “Appendix”, “Schedule”, or “Exhibit” shall mean a Section, subsection, clause, Appendix, Schedule or Exhibit of this Agreement, as the case may be.

All references to a given agreement, instrument, tariff or other document, or law, regulation or ordinance shall be a reference to that agreement, instrument, tariff or other document, or law, regulation or ordinance as such now exists and as may be amended 85 10

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from time to time, or its successor. A reference to a “person” includes any individual, partnership, firm, company, corporation, joint venture, trust, association, organization or other entity, in each case whether or not having a separate legal personality and includes its successors and permitted assigns. A reference to a “day” shall mean a Calendar Day unless otherwise specified. The singular shall include the plural and the masculine shall include the feminine, and vice versa.

Section 2. Purpose. The purpose of this Agreement is to: (i) set forth the terms and conditions under which NCPA shall enter into the PPA on behalf of the Participants, (ii) authorize NCPA, acting on behalf of the Participants, to engage in all activities related to that basic purpose, and (iii) specify the rights and obligations of NCPA and the Participants with respect to the PPA.

Section 3. Sale and Purchase of Products. By executing this Agreement, each Participant acknowledges and agrees to be bound by the terms and conditions of the Agreement, and that the Agreement is written as a “take-or-pay” agreement. Any Product delivered to NCPA under the PPA shall be delivered to each Participant in proportion to such Participant’s Project Participation Percentage as set forth in Exhibit A, and each Participant shall accept and pay for its respective percentage of such Product. To the extent a Participant is unable to accept such deliveries in full, NCPA shall dispose of such surplus in its sole discretion, in such a manner to attempt to maximize Participant value and that Participant shall reimburse to NCPA any costs incurred by NCPA in doing so. 86 11

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Notwithstanding the above, NCPA may allocate Product procured through the PPA among the Participants in such percentages as NCPA may, in its reasonable discretion, determine are necessary, desirable, or appropriate, in order to accommodate Participant transfer rights pursuant to Section 9.

3.1 Scheduling. Products delivered from Seller shall be scheduled for and to the Participants in accordance with Scheduling Protocols, and the terms and conditions of the PPA.

Section 4. Billing and Payments

4.1 Participant Payment Obligations. Each Participant agrees to pay to NCPA each month its respective portion of the Project Costs, Administrative Services Costs, scheduling coordination costs, and all other costs for services provided in accordance with this Agreement and the Amended and Restated Facilities Agreement. In addition to the aforementioned monthly payment obligations, each Participant is obligated to fund: (i) any and all required Security Deposits calculated in accordance with Section 5, and (ii) any working capital requirements for the Project maintained by NCPA as determined, collected and set forth in the Annual Budget.

4.2 Invoices. NCPA will issue an invoice to each Participant for its share of Project Costs, Administrative Services Costs, scheduling coordination costs, and all other costs for services provided in accordance with this Agreement and the Amended and Restated Facilities Agreement. Such invoice may be either the All Resources Bill or 87 12

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separate special invoice, as determined by NCPA. At NCPA’s discretion, invoices may be issued to Participants using electronic media or physical distribution.

4.3 Payment of Invoices. All invoices delivered by NCPA (including the All Resources Bill) are due and payable thirty (30) Calendar Days after the date thereof; provided, however, that any amount due on a day other than a Business Day may be paid on the following Business Day.

4.4 Late Payments. Any amount due and not paid by a Participant in accordance with Section 4.3 shall be considered late and bear interest computed on a daily basis until paid at the lesser of (i) the per annum prime rate (or reference rate) of the Bank of America NT&SA then in effect, plus two percent (2%) or (ii) the maximum rate permitted by law.

4.5 Billing Disputes. A Participant may dispute the accuracy of any invoice issued by NCPA under this Agreement by submitting a written dispute to NCPA, within thirty (30) Calendar Days after the date of such invoice; nonetheless the Participant shall pay the full amount billed when due. If a Participant does not timely question or dispute the accuracy of any invoice in writing, then the invoice shall be deemed to be correct.

Upon review of a submitted dispute, if an invoice is determined by NCPA to be incorrect, then NCPA shall issue a corrected invoice and refund any amounts that may be due to the Participant. If NCPA and the Participant fail to agree on the accuracy of an invoice within thirty (30) Calendar Days after the Participant has disputed it, then the General Manager shall promptly submit the dispute to the Commission for resolution. If the Commission 88 13

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and the Participant fail to agree on the accuracy of a disputed invoice within sixty (60) Calendar Days after its submission to the Commission, then the dispute may then be resolved under the mediation and arbitration procedures set forth in Section 12 of this Agreement; provided, however, that prior to resorting to either mediation or arbitration proceedings, the full amount of the disputed invoice must be paid by the Participant.

4.6 Billing/Settlement Data and Examination of Books and Records.

4.6.1 Settlement Data. NCPA shall make billing and settlement data available to the Participants in the All Resources Bill, or other invoice, or upon request.

NCPA may also, at its sole discretion, make billing and settlement support information available to Participants using electronic media (e.g. electronic data portal).

Procedures and formats for the provision of such electronic data submission may be established by the Commission from time to time. Without limiting the generality of the foregoing, NCPA may, in its reasonable discretion, require the Participants to execute a non-disclosure agreement prior to providing access to the NCPA electronic data portal.

4.6.2 Examination of Books and Records. Any Participant to this Agreement shall have the right to examine the books and records created and maintained by NCPA pursuant to this Agreement at any reasonable, mutually agreed upon time.
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Section 5. Security Deposit Administration

5.1 Security Deposit Requirements. Each Participant agrees that any funds deposited at NCPA to satisfy Participant’s Security Deposit requirements pursuant to this Agreement shall be irrevocably committed and held by NCPA in the General Operating Reserve, and that such funds may be used by NCPA in accordance with Section 5.1.3.

Each Participant’s Security Deposit will be accounted separately from and in addition to any other security accounts or deposits maintained pursuant to any other agreement between NCPA and the Participant, or any other such security account or deposits required of Members. In connection with fulfilling the Security Deposit requirements of this Agreement, Participant may elect to use its uncommitted funds held in the General Operating Reserve to satisfy in whole or in part its Security Deposit required under Section 5. If Participant chooses to satisfy in whole or in part its security requirements using its uncommitted funds held in the General Operating Reserve, then Participant is required to execute and deliver to NCPA an Irrevocable Letter of Direction, directing NCPA to utilize Participant’s uncommitted General Operating Reserve funds for such purposes, and the designated funds will thereafter be irrevocably committed and held by NCPA to satisfy the requirements of this Agreement.

5.1.1 Initial Amounts. No later than June 1, 2027, each Participant shall ensure that sufficient Security Deposit funds have been deposited with and are held by NCPA in an amount not greater than the highest three (3) months of estimated Project 90 15

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Costs, as estimated by NCPA. Such Security Deposit requirement may be satisfied by Participant in whole or part either in cash, through irrevocable commitment of its uncommitted funds held in the General Operating Reserve in accordance with Section

5.1, or through a clean, irrevocable letter of credit satisfactory to NCPA’s General Manager.

5.1.2 Subsequent Deposits. Periodically, and at least quarterly, NCPA shall review and revise its estimate of Project Costs for which Participant shall be obligated to pay under this Agreement. Following such review, NCPA shall determine whether each Participant has a sufficient Security Deposit balance at NCPA. To the extent that any Participant’s Security Deposit balance is greater than one hundred and ten percent (110%) of the amount required herein, NCPA shall credit such amount as soon as practicable to the Participant’s next following All Resources Bill, or by separate special invoice. To the extent that any Participant’s Security Deposit balance is less than ninety percent (90%) of the amount required herein, NCPA shall add such amount as soon as practicable to such Participant’s next All Resources Bill, or as necessary, to a special invoice to be paid by Participant upon receipt. Credits or additions shall not be made to Participants who satisfy these Security Deposit requirements in whole through the use of a letter of credit; provided, that the amount of the letter of credit shall be adjusted, as required from time to time, in a like manner to assure an amount not to 91 16

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exceed the highest three (3) months of estimated Project Costs is available to NCPA, as determined by NCPA.

5.1.3 Use of Security Deposit Funds. NCPA may use any and all Security Deposit funds held by NCPA (or utilize a letter of credit provided in lieu thereof) to pay any costs it incurs hereunder, including making payments to Seller, without regard to any individual Participant’s Security Deposit balance or proportionate share of Project Costs, and irrespective of whether NCPA has issued an All Resources Bill or special invoice for such costs to the Participants or whether a Participant has made timely payments of All Resources Bills or special invoices.

Should Participant have satisfied its Security Deposit requirements in whole or part through a letter of credit, NCPA may draw on such letter of credit to satisfy Participant’s obligations hereunder at NCPA’s sole discretion. Notwithstanding the foregoing, if any Participant fails to pay any costs incurred by NCPA pursuant to this Agreement, NCPA shall first use that non-paying Participant’s Security Deposit and shall not use any other Participants’ Security Deposit until such non-paying Participant’s Security Deposit has been exhausted.

5.1.4 Accounting. If Security Deposit funds or a letter of credit are used by NCPA to pay any costs it incurs hereunder as described in Section 5.1.3, then NCPA will maintain a detailed accounting of each Participant’s shares of funds withdrawn, and upon the collection of all or a part of such withdrawn funds, NCPA will credit 92 17

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back to each non-defaulting Participant the funds collected in proportion to such nondefaulting Participant’s share of funds initially withdrawn.

5.1.5 Emergency Additions. In the event that funds are withdrawn pursuant to Section 5.1.3, or if the Security Deposit held by NCPA is otherwise insufficient to allow for NCPA to pay any invoice, demand, request for further assurances by Seller, or claims, NCPA shall notify all Participants of the deficiency. In conjunction with such notice, NCPA shall send a special or emergency assessment invoice to the Participant or Participants that caused or are otherwise responsible for the deficiency. Each Participant of such an invoice shall pay to NCPA such assessment when and if assessed by NCPA within two (2) Business Days of the invoice date of the assessment, or shall consent to and direct NCPA to draw on any existing letter of credit Participant has established for such purposes. In the event that the Participant or Participants that caused or are otherwise responsible for the deficiency cannot, does not or will not pay to NCPA the special or emergency assessment within two (2) Business Days after the invoice date, NCPA shall immediately submit a special or emergency invoice to all remaining Participants, and such remaining Participants shall pay to NCPA such assessment within two (2) Business Days after the invoice date of the assessment, or shall consent to and direct NCPA to draw on any existing letter of credit that Participant has established for such purposes. 93 18

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5.1.6 Security Deposit Interest. NCPA shall maintain a detailed accounting of each Participant’s Security Deposits, and withdrawals of such funds, held by NCPA. Security Deposits held by NCPA shall be invested by NCPA in accordance with the General Operating Reserve policies and investment policies adopted by the NCPA Commission. Interest earned on the Security Deposit funds shall be proportionately credited to the Participants in accordance with their weighted average balances held therein. Any Security Deposit losses caused by early termination of investments shall be allocated among the Participants in accordance with the General Operating Reserve provisions and guidelines approved by the Commission, as the same may be amended from time to time; provided, however, to the extent that either the General Operating Reserve provisions and guidelines do not apply or the Security Deposit is not adequate to cover the losses, then such losses shall be allocated among the Participants in accordance with their proportionate Security Deposit balances.

5.1.7 Return of Funds. Upon termination or a permitted withdrawal of a Participant in accordance with this Agreement, the affected Participant may apply to NCPA for the return of their share of Security Deposit funds ninety (90) days after the effective date of such termination or withdrawal. However, NCPA shall, in its sole but reasonable discretion, as determined by the NCPA General Manager, estimate the then outstanding liabilities of the Participant, including any estimated contingent liabilities 94 19

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and shall retain all such funds, if any, until all such liabilities have been fully paid or otherwise satisfied in full. After all such liabilities have been satisfied in full, as determined by NCPA’s General Manager, any remaining balance of the Participant’s share of the Security Deposit will be refunded to the Participant within sixty (60) days thereafter.

Section 6. Cooperation and Further Assurances. Each of the Parties agree to provide such information, execute and deliver any instruments and documents and to take such other actions as may be necessary or reasonably requested by any other Party which are consistent with the provisions of this Agreement and which do not involve the assumption of obligations other than those provided for in this Agreement, in order to give full effect to this Agreement and to carry out the intent of this Agreement. The Parties agree to cooperate and act in good faith in connection with obtaining any credit support required in order to satisfy the requirements of this Agreement.

Section 7. Participant Covenants and Defaults

7.1 Each Participant covenants and agrees: (i) to make payments to NCPA, from its Electric System Revenues, of its obligations under this Agreement as an operating expense of its Electric System; (ii) to fix the rates and charges for services provided by its Electric System, so that it will at all times have sufficient Revenues to meet the obligations of this Agreement, including the payment obligations; (iii) to make all such payments due NCPA under this Agreement whether or not there is an interruption in, interference with, 95 20

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or reduction or suspension of services provided under this Agreement, such payments not being subject to any reduction, whether by offset or otherwise, and regardless of whether any reasonable dispute exists; and (iv) to operate its Electric System, and the business in connection therewith, in accordance with Good Utility Practices.

7.2 Events of Default. An Event of Default under this Agreement shall exist upon the occurrence of any one or more of the following by a Participant (the “Defaulting Participant”):
(i) the failure of any Participant to make any payment in full to NCPA when due;
(ii) the failure of a Participant to perform any covenant or obligation of this Agreement where such failure is not cured within thirty (30) Calendar Days following receipt of a notice from NCPA demanding cure; provided, that this subsection shall not apply to any failure to make payments specified by subsection 7.2 (i)); (iii) if any representation or warranty of a Participant material to the services provided hereunder shall prove to have been incorrect in any material respect when made and the Participant does not cure the facts underlying such incorrect representation or warranty so that the representation or warranty becomes true and correct within thirty (30) Calendar Days after the date of receipt of notice from NCPA demanding cure; or 96 21

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(iv) if a Participant is in default or in breach of any of its covenants or obligations under any other agreement with NCPA and such default or breach is not cured within the time periods specified in such agreement.

7.3 Uncontrollable Forces. A Party shall not be considered to be in default in respect of any obligation hereunder if prevented from fulfilling such obligation by reason of Uncontrollable Forces; provided, that in order to be relieved of an Event of Default due to Uncontrollable Forces, a Party affected by an Uncontrollable Force shall:
(i) first provide oral notice to the General Manager using telephone communication within two (2) Business Days after the onset of the Uncontrollable Force, and provide subsequent written notice to the General Manager and all other Parties within ten (10) Business Days after the onset of the Uncontrollable Force, describing its nature and extent, the obligations which the Party is unable to fulfill, the anticipated duration of the Uncontrollable Force, and the actions which the Party will undertake so as to remove such disability and be able to fulfill its obligations hereunder; and (ii) use due diligence to place itself in a position to fulfill its obligations hereunder and if unable to fulfill any obligation by reason of an Uncontrollable Force such Party shall exercise due diligence to remove such disability with reasonable dispatch; provided, that nothing in this subsection shall require a Party to settle or compromise a labor dispute.
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7.4 Cure of an Event of Default. An Event of Default shall be deemed cured only if such default shall be remedied or cured within the time periods specified in Section 7.2 above, as may be applicable, provided, however, upon request of the Defaulting Participant the Commission may waive the default at its sole discretion, where such waiver shall not be unreasonably withheld.

7.5 Remedies in the Event of Uncured Default. Upon the occurrence of an Event of Default which is not cured within the time limits specified in Section 7.2, without limiting other rights or remedies available under this Agreement, at law or in equity, and without constituting or resulting in a waiver, release or estoppel of any right, action or cause of action NCPA may have against the Defaulting Participant, NCPA may take any or all of the following actions:
(i) suspend the provision of services under this Agreement to such Defaulting Participant; or
(ii) demand that the Defaulting Participant provide further assurances to guarantee the correction of the default, including the collection of a surcharge or increase in electric rates, or such other actions as may be necessary to produce necessary Revenues to correct the default.

7.6 Effect of Suspension.

7.6.1 Generally. The suspension of this Agreement will not terminate, waive, or otherwise discharge any ongoing or undischarged liabilities, credits or 98 23

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obligations arising from this Agreement until such liabilities, credits or obligations are satisfied in full.

7.6.2 Suspension. If performance of all or any portion of this Agreement is suspended by NCPA with respect to a Participant in accordance with subsection

7.5(i), then such Participant shall pay any and all costs incurred by NCPA as a result of such suspension including reasonable attorney’s fees, the fees and expenses of other experts, including auditors and accountants, or other reasonable and necessary costs associated with such suspension and any portion of the Project Costs, scheduling and dispatch costs, and Administrative Services Costs that were not recovered from such Participant as a result of such suspension.

Section 8. Administration of Agreement

8.1 Commission. The Commission is responsible for the administration of this Agreement. Each Participant shall be represented by its Commissioner or their designated alternate Commissioner (“Alternate”) pursuant to the Joint Powers Agreement. Each Commissioner shall have authority to act for the Participant represented with respect to matters pertaining to this Agreement.

8.2 Forum. Whenever any action anticipated by this Agreement is required to be jointly taken by the Participants, such action shall be taken at regular or special meetings of the NCPA Commission.
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8.3 Quorum. For purposes of acting upon matters that relate to administration of this Agreement, a quorum of the Participants shall consist of those Commissioners, or their designated Alternate, representing a numerical majority of the Participants.

8.4 Voting. Each Participant shall have the right to cast one vote with respect to matters pertaining to this Agreement. A unanimous vote of all Participants shall be required for action regarding: (i) any transfer of rights to a Third Party as described in Section 9 of this Agreement; and (ii) for matters related to any of the following actions as provided for in the PPA: (a) exercising any early termination provisions as set forth in the PPA, and (b) exercising any assignment rights as set forth in the PPA. For all other matters pertaining to this Agreement, a majority vote of the Participants shall be required for action.

8.5 New PV Trade Measure Events. Section 2.5 of the PPA permits the Seller to extend both the Guaranteed Construction Start Date and Guaranteed Commercial Operation Date if there is a New PV Trade Measure Event or UFLPA/WRO Restraint; provided, however, either Seller or NCPA may terminate the PPA in the event the extension of time exceeds the time limits set forth in Section 2.5 and Exhibit B of the PPA.

Section 2.5 of the PPA also provides Seller the right to submit a Proposed Contract Price Increase to NCPA to keep Seller whole with respect to any actual cost increases that Seller incurs as a result of a New PV Trade Measure Event. If the Proposed Contract Price Increase is less than or equal to $8.50/MWh in aggregate, or the extension of the 100
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Guaranteed Construction Start Date or Guaranteed Commercial Operation Date is less than three hundred and sixty-five (365) days in aggregate, the NCPA General Manager is hereby delegated authority by the Participants to approve the price increase based on their determination that (1) the Independent Report provided by the Seller supports the Proposed Contract Price Increase, and (2) the PPA with the Proposed Contract Price Increase is still favorable when compared to current market conditions for similar products. The NCPA General Manager shall notify the Commission of the acceptable Proposed Contract Price Increase and associated modifications to the PPA with the foregoing findings, if any, at the next available Commission meeting. If the Proposed Contract Price Increase is greater than $8.50/MWh in aggregate, or the extension of the Guaranteed Construction Start Date or Guaranteed Commercial Operation Date is longer than three hundred and sixty-five (365) days in aggregate, the proposed modifications to the PPA will be brought to the Commission for discussion and further action.

Section 9. Transfer of Rights by Participants

9.1 A Participant has the right to make transfers, sales, assignments and exchanges (collectively “transfers(s)”) of any portion of its Project Participation Percentage and rights thereto, subject to the approval provisions in Section 8.4 of this Agreement, provided that the transferee satisfies all applicable criterion in the PPA. If a Participant desires to transfer a portion or its entire share of the Project for a specific time interval, or 101
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permanently, then NCPA will, if requested by such Participant, use its best efforts to transfer that portion of the Participant’s share of the Project.

9.2 Unless otherwise set forth in this Agreement, before a Participant may transfer an excess Project share pursuant to Section 9.1 to any person or entity other than a Participant, it shall give all other Participants the right to purchase the share on the same terms and conditions. Before a Participant may transfer an excess Project share pursuant to section 9.1 to any person or entity other than a Member, it shall give all Members the right to purchase the share on the same terms and conditions. Such right shall be exercised within thirty (30) days of receipt of notice of said right.

No transfer shall relieve a Participant of any of its obligations under this Agreement except to the extent that NCPA receives payment of these obligations from a transferee.

9.3 The provisions of this Section 9 do not apply to the Exhibit A, unless expressly set forth therein.

Section 10. Term and Termination. This Agreement shall become effective when it has been duly executed by all Participants, and delivered to and executed by NCPA (the “Effective Date”). NCPA shall notify all Participants in writing of the Effective Date. The Term of this Agreement shall be coterminous with the PPA, and shall commence on the Effective Date, and shall continue through the term of the PPA. 102
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Section 11. Withdrawal of Participants. No Participant may withdraw from this Agreement except as otherwise provided for herein.

Section 12. Settlement of Disputes and Arbitration. The Parties agree to make best efforts to settle all disputes among themselves connected with this Agreement as a matter of normal business under this Agreement. The procedures set forth in Section 10 of the Power Management and Administrative Services Agreement shall apply to all disputes that cannot be settled by the Participants themselves; provided, that the provisions of Section 4.5 shall first apply to all disputes involving invoices prepared by NCPA.

Section 13. Miscellaneous

13.1 Confidentiality. The Parties will keep confidential all confidential or trade secret information made available to them in connection with this Agreement, to the extent possible, consistent with applicable laws, including the California Public Records Act.

Confidential or trade secret information shall be marked or expressly identified as such.

If a Party (“Receiving Party”) receives a request from a Third Party for access to, or inspection, disclosure or copying of, any other Party’s (the “Supplying Party”) confidential data or information, which the Receiving Party has possession of (“Disclosure Request”), then the Receiving Party shall provide notice and a copy of the Disclosure Request to the Supplying Party within three (3) Business Days after receipt of the Disclosure Request.

Within three (3) Business Days after receipt of such notice, the Supplying Party shall provide notice to the Receiving Party either:
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(i) that the Supplying Party believes there are reasonable legal grounds for denying or objecting to the Disclosure Request, and the Supplying Party requests the Receiving Party to deny or object to the Disclosure Request with respect to identified confidential information. In such case, the Receiving Party shall deny the Disclosure Request and the Supplying Party shall defend the denial of the Disclosure Request at its sole cost, and it shall indemnify the Receiving Party for all costs associated with denying or objecting to the Disclosure Request. Such indemnification by the Supplying Party of the Receiving Party shall include all of the Receiving Party’s costs reasonably incurred with respect to denial of or objection to the Disclosure Request, including but not limited to costs, penalties, and the Receiving Party’s attorney’s fees; or (ii) that the Receiving Party may grant the Disclosure Request without any liability by the Receiving Party to the Supplying Party.

13.2 Indemnification and Hold Harmless. Subject to the provisions of Section

13.4, each Participant agrees to indemnify, defend and hold harmless NCPA and its Members, including their respective governing boards, officials, officers, agents, and employees, from and against any and all claims, suits, losses, costs, damages, expenses and liability of any kind or nature, including reasonable attorneys’ fees and the costs of litigation, including experts, to the extent caused by any acts, omissions, breach of contract, negligence (active or passive), gross negligence, recklessness, or willful 104
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misconduct of that Participant, its governing officials, officers, employees, subcontractors or agents, to the maximum extent permitted by law.

13.3 Several Liabilities. No Participant shall, in the first instance, be liable under this Agreement for the obligations of any other Participant or for the obligations of NCPA incurred on behalf of other Participants. Each Participant shall be solely responsible and liable for performance of its obligations under this Agreement, except as otherwise provided for herein. The obligation of each Participant under this Agreement is, in the first instance, a several obligation and not a joint obligation with those of the other Participants.

Notwithstanding the foregoing, the Participants acknowledge that any debts or obligations incurred by NCPA under this Agreement on behalf of any of them shall be borne solely by such Participants in proportion to their respective Project Participation Percentages, and not by non-Participant Members of NCPA, pursuant to Article IV, Section 3(b) of the Joint Powers Agreement.

In the event that a Participant should fail to pay its share of the debts or obligations incurred by NCPA as required by this Agreement, the remaining Participants shall, in proportion to their Project Participation Percentages, pay such unpaid amounts and shall be reimbursed by the Participant failing to make such payments.

13.4 No Consequential Damages. FOR ANY BREACH OF ANY PROVISION OF

THIS AGREEMENT FOR WHICH AN EXPRESS REMEDY OR MEASURE OF DAMAGES 105
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IS PROVIDED IN THIS AGREEMENT, THE LIABILITY OF THE DEFAULTING PARTY

SHALL BE LIMITED AS SET FORTH IN SUCH PROVISION, AND ALL OTHER DAMAGES OR REMEDIES ARE HEREBY WAIVED. IF NO REMEDY OR MEASURE OF

DAMAGE IS EXPRESSLY PROVIDED, THE LIABILITY OF THE DEFAULTING PARTY

SHALL BE LIMITED TO ACTUAL DAMAGES ONLY AND ALL OTHER DAMAGES AND REMEDIES ARE HEREBY WAIVED. IN NO EVENT SHALL NCPA OR ANY

PARTICIPANT OR THEIR RESPECTIVE SUCCESSORS, ASSIGNS, REPRESENTATIVES,

DIRECTORS, OFFICERS, AGENTS, OR EMPLOYEES BE LIABLE FOR ANY LOST

PROFITS, CONSEQUENTIAL, SPECIAL, EXEMPLARY, INDIRECT, PUNITIVE, OR

INCIDENTAL LOSSES OR DAMAGES, INCLUDING LOSS OF USE, LOSS OF

GOODWILL, LOST REVENUES, LOSS OF PROFIT OR LOSS OF CONTRACTS EVEN IF

SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, AND

NCPA AND EACH PARTICIPANT EACH HEREBY WAIVES SUCH CLAIMS AND

RELEASES EACH OTHER AND EACH OF SUCH PERSONS FROM ANY SUCH LIABILITY.

The Parties acknowledge that California Civil Code section 1542 provides that: “A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.” The Parties waive the provisions of section 1542, or other similar provisions of law, and intend that the waiver 106
31 THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT
and release provided by this Section of this Agreement shall be fully enforceable despite its reference to future or unknown claims.

13.5 Waiver. No waiver of the performance by a Party of any obligation under this Agreement with respect to any default or any other matter arising in connection with this Agreement shall be effective unless given by the Commission or the governing body of a Participant, as applicable. Any such waiver by the Commission in any particular instance shall not be deemed a waiver with respect to any subsequent performance, default or matter.

13.6 Amendments. Except where this Agreement specifically provides otherwise, this Agreement may be amended only by written instrument executed by the Parties with the same formality as this Agreement.

13.7 Assignment of Agreement.

13.7.1 Binding Upon Successors. This Agreement shall inure to the benefit of and shall be binding upon the respective successors and assignees of the Parties to this Agreement.

13.7.2 No Assignment. Neither this Agreement, nor any interest herein, shall be transferred or assigned by a Party hereto except with the consent in writing of the other Parties hereto, which consent shall not be unreasonably withheld.

13.8 Severability. In the event that any of the terms, covenants or conditions of this Agreement or the application of any such term, covenant or condition, shall be held 107
32 THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT
invalid as to any person or circumstance by any court having jurisdiction, all other terms, covenants or conditions of this Agreement and their application shall not be affected thereby, but shall remain in force and effect unless the court holds that such provisions are not severable from all other provisions of this Agreement.

13.9 Governing Law. This Agreement shall be interpreted, governed by, and construed under the laws of the State of California.

13.10 Headings. All indices, titles, subject headings, section titles and similar items are provided for the purpose of convenience and are not intended to be inclusive, definitive, or affect the meaning of the contents of this Agreement or the scope thereof.

13.11 Notices. Any notice, demand or request required or authorized by this Agreement to be given to any Party shall be in writing, and shall either be personally delivered to a Participant’s Commissioner or Alternate, and to the General Manager, or shall be transmitted to the Participant and the General Manager at the addresses shown on the signature pages hereof. The designation of such addresses may be changed at any time by written notice given to the General Manager who shall thereupon give written notice of such change to each Participant. All such notices shall be deemed delivered when personally delivered, two (2) Business Days after deposit in the United States mail first class postage prepaid, or on the first Business Day following delivery through electronic communication.
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33 THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT

13.12 Warranty of Authority. Each Party represents and warrants that it has been duly authorized by all requisite approval and action to execute and deliver this Agreement and that this Agreement is a binding, legal, and valid agreement enforceable in accordance with its terms. Upon execution of this Agreement, each Participant shall deliver to NCPA a resolution of the governing body of such Participant evidencing approval of and authority to enter into this Agreement.

13.13 Counterparts. This Agreement may be executed in any number of counterparts, and each executed counterpart shall have the same force and effect as an original instrument and as if all the signatories to all of the counterparts had signed the same instrument. Any signature page of this Agreement may be detached from any counterpart of this Agreement without impairing the legal effect of any signatures thereon, and may be attached to another counterpart of this Agreement identical in form hereto but having attached to it one or more signature pages.

13.14 Venue. In the event that a Party brings any action under this Agreement, the Parties agree that trial of such action shall be vested exclusively in the state courts of California in the County of Placer or in the United States District Court for the Eastern District of California.

13.15 Attorneys’ Fees. If a Party to this Agreement brings any action, including an action for declaratory relief, to enforce or interpret the provisions of this Agreement, then 109
34 THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT
each Party shall bear its own fees and costs, including attorneys’ fees, associated with the action.

13.16 Counsel Representation. Pursuant to the provisions of California Civil Code Section 1717 (a), each of the Parties were represented by counsel in the negotiation and execution of this Agreement and no one Party is the author of this Agreement or any of its subparts. Those terms of this Agreement which dictate the responsibility for bearing any attorney’s fees incurred in arbitration, litigation or settlement in a manner inconsistent with the provisions of Section 13.2 were intentionally so drafted by the Parties, and any ambiguities in this Agreement shall not be interpreted for or against a Party by reason of that Party being the author of the provision.

13.17 No Third Party Beneficiaries. Nothing contained in this Agreement is intended by the Parties, nor shall any provision of this Agreement be deemed or construed by the Parties, by any third person or any Third Parties, to be for the benefit of any Third Party, nor shall any Third Party have any right to enforce any provision of this Agreement or be entitled to damages for any breach by the Parties of any of the provisions of this Agreement.
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35 THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT
IN WITNESS WHEREOF, NCPA and each Participant have, by the signature of its duly authorized representative shown below, executed and delivered a counterpart of this Agreement.

NORTHERN CALIFORNIA

POWER AGENCY
651 Commerce Drive
Roseville, CA 95678
_____________________________
By: Randy S. Howard
Title: General Manager
Date:

Approved as to form:
_____________________________
By: Jane E. Luckhardt
Its: General Counsel
Date:

Attestation (if applicable):
_____________________________
By:__________________________
Its:

Date:

CITY OF SANTA CLARA
1500 Warburton Avenue
Santa Clara, CA 95050
_____________________________
By:__________________________
Title: __________________________
Date:

Approved as to form:
_____________________________
By:__________________________
Its: City Attorney
Date:

Attestation (if applicable):
_____________________________
By:__________________________
Its:

Date:
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36 THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT

CITY OF BIGGS
465 C Street
Biggs, CA 95917
_____________________________
By:__________________________
Title: ________________________
Date:

Approved as to form:
_____________________________
By:__________________________
Its: City Attorney
Date:

Attestation (if applicable)
_____________________________
By:__________________________
Its:

Date:

CITY OF GRIDLEY
685 Kentucky Street
Gridley, CA 95948
_____________________________
By:__________________________
Title: ________________________
Date:

Approved as to form:
_____________________________
By:

Its: City Attorney__________________
Date:

Attestation (if applicable)
_____________________________
By:__________________________
Its:

Date:
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37 THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT

CITY OF HEALDSBURG
401 Grove Street
Healdsburg, CA 95448
_____________________________
By:__________________________
Title: ________________________
Date:

Approved as to form:
_____________________________
By:

Its: City Attorney__________________
Date:

Attestation (if applicable)
_____________________________
By:__________________________
Its:

Date:

CITY OF LODI
221 W. Pine Street
Lodi, CA 95240
_____________________________
By:__________________________
Title: ________________________
Date:

Approved as to form:
_____________________________
By:

Its: City Attorney__________________
Date:

Attestation (if applicable)
_____________________________
By:__________________________
Its:

Date:
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38 THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT

CITY OF LOMPOC
100 Civic Center Plaza
Lompoc, CA 93436
_____________________________
By:__________________________
Title: ________________________
Date:

Approved as to form:
_____________________________
By:

Its: City Attorney__________________
Date:

Attestation (if applicable)
_____________________________
By:__________________________
Its:

Date:

CITY OF OAKLAND, acting
by and through its
Board of Port Commissioners
530 Water Street
Oakland, CA 94607
_____________________________
By:__________________________
Title: ________________________
Date:

Approved as to form:
_____________________________
By:

Its: City Attorney__________________
Date:

Attestation (if applicable)
_____________________________
By:__________________________
Its:

Date:
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39 THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT

PLUMAS-SIERRA RURAL

ELECTRIC COOPERATIVE
73233 State Highway 70
Portola, CA 96122
_____________________________
By:__________________________
Title: ________________________
Date:

Approved as to form:
_____________________________
By:

Its: City Attorney _________________
Date:

Attestation (if applicable)
_____________________________
By:__________________________
Its:

Date:

CITY OF SHASTA LAKE
4477 Main Street
Shasta Lake, CA 96019
_____________________________
By:__________________________
Title: ________________________
Date:

Approved as to form:
_____________________________
By:

Its: City Attorney__________________
Date:

Attestation (if applicable)
_____________________________
By:__________________________
Its:

Date:
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40 THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT

CITY OF UKIAH
300 Seminary Avenue
Ukiah, CA 95482
_____________________________
By:__________________________
Title: ________________________
Date:

Approved as to form:
_____________________________
By:

Its: City Attorney__________________
Date:

Attestation (if applicable)
_____________________________
By:__________________________
Its:

Date:____________________________
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41 THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT

EXHIBIT A

PROJECT PARTICIPATION PERCENTAGES

1. On the Effective Date of the Agreement the initial Participants (“Initial Participants”) who are signatory to this Agreement, and their respective initial Project Participation Percentage share of the Project is set forth in Table 1 of this Exhibit A (“Initial Project Participation Percentages”). The process set forth below is not subject to the requirements of Section 9 of this Agreement, except as set forth below.

2. Thereafter, a Member listed in Table 2 of this Exhibit A and who is not an Initial Participant (“Eligible Member”) may exercise a right to accept a transfer of a portion of the Initial Project Participation Percentages of the Initial Participants in an amount no greater than the amount set forth in Table 2 of this Exhibit A (“Transfer Right”, no later than 180 day after the Effective Date (the “Transfer Completion Deadline”), unless an Initial Participants otherwise agrees in writing to extend the Transfer Completion Deadline. Only 117
42 THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT
the City of Santa Clara may transfer their Initial Project Participation Percentages as long as their project share does not fall below the amounts set forth in Table 2 of this Exhibit A.

3. In order for an Eligible Member to exercise their Transfer Rights, that Member shall do the following no later than the Transfer Completion Deadline: (i) notify NCPA and Santa Clara of its intention to exercise their right to accept their Table 2 share, and (ii) execute this Agreement. For avoidance of doubt, an Eligible Member must exercise their Transfer Right for their full Table 2 share; any exercise of any lesser portion shall be invalid.

4. For purposes of this Exhibit A only, a Member who becomes a Participant pursuant to Section 3 of this Exhibit A shall be referred to as a “Table 2 Participant.” Notwithstanding the foregoing, the Transfer Completion Deadline applies only to the intended assumption of the Project Participation Percentage described in Table 2 of this Exhibit A, and shall not limit or reduce a Participant’s rights set forth in Section 9 of this Agreement. Upon written notice and execution of this Agreement as set forth above in Section 3 of Exhibit A, the Table 2 Participant will assume all rights and obligations set forth in this Agreement for the portion of the Project Participation Percentage share of the Project as set forth in Table 2 of this Exhibit A.

5. NCPA shall prepare Table 3 after the Transfer Completion Deadline to reflect the Final Project Participation Percentages of each Participant, and such Table 3 will be added to this Exhibit A as an amendment to this Agreement once adopted by the Commission. In the event an intended Table 2 Participant does not become a Table 2 Participant by the 118
43 THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT
Transfer Completion Deadline, the City of Santa Clara shall retain the Project Participation

6. Percentage of the intended Table 2 Participant as described in Table 2 of this Exhibit A, and such will be reflected in Table 3.

Pursuant to Section 5 of Exhibit B of the PPA, if the Facility Installed Capacity is less than one hundred percent (100%) of the Guaranteed Capacity, Seller shall have one hundred fifty (150) days after the Commercial Operation Date to install additional capacity such that the Installed Capacity is equal to (but not greater than) the Guaranteed Capacity. If Seller fails to construct the Guaranteed Capacity by such date, Seller shall pay NCPA Capacity Damages, and each MW (or portion thereof) that the Guaranteed Capacity exceeds the Installed Capacity, the Project Participation Share for the Participants shall be automatically adjusted and reduced, on a pro rata basis, to equal to actual amount of Facility Installed Capacity.
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44 THIRD PHASE AGREEMENT FOR GRACE SOLAR PROJECT

EXHIBIT B
Renewable Power Purchase Agreement
The Renewable Power Purchase Agreement between Grace Orchard Energy Center, LLC and Northern California Power Agency has been attached to this Agreement as Exhibit B.
120
Cover Sheet

RENEWABLE POWER PURCHASE AGREEMENT

COVER SHEET
Seller: Grace Orchard Energy Center, LLC, a Delaware limited liability company Buyer: Northern California Power Agency, a joint powers agency of the State of California Description of Facility: A 50 MWAC solar photovoltaic generating facility located in Riverside County, California, as further described in Exhibit A.

Milestones:

Milestone Date for
Completion
Evidence of Site Control 9/1/2025
Executed Interconnection Agreement Completed
Guaranteed Construction Start Date 9/1/2026
Guaranteed Commercial Operation Date 12/1/2027
Delivery Term: The period for Product delivery will be for twenty (20) Contract Years.

Expected Energy: The amount of Expected Energy is set forth below.

Contract Year Expected Energy (MWh)
1 146,941
2 146,885
3 146,372
4 145,848
5 145,315
6 144,773
7 144,221
8 143,660
9 143,089
10 142,508
11 141,916
12 141,314
121
Cover Sheet
13 140,703
14 140,083
15 139,454
16 138,816
17 138,168
18 137,509
19 136,836
20 136,151
Guaranteed Capacity: 50 MWAC
Dedicated Interconnection Capacity: 50 MWAC
Contract Price:

Contract Year Contract Price
1 – 20 $42.51/MWh (flat) with no
escalation
Product:
 Facility Energy
 Green Attributes, including, but not limited to, Portfolio Content Category 1 Renewable Energy Credits
Scheduling Coordinator: Buyer or Buyer’s agent
Development Security: $100/kW of Guaranteed Capacity
Performance Security: $75/kW of Installed Capacity
122

TABLE OF CONTENTS
i
ARTICLE 1 DEFINITIONS ........................................................................................................ 1

1.1 Contract Definitions............................................................................................. 1

1.2 Rules of Interpretation ...................................................................................... 23 ARTICLE 2 TERM; CONDITIONS PRECEDENT.................................................................. 24

2.1 Contract Term.................................................................................................... 24

2.2 Conditions Precedent......................................................................................... 25

2.3 Development; Construction; Progress Reports............................................... 26

2.4 Remedial Action Plan ........................................................................................ 26

2.5 New PV Trade Measure Events and UFLPA/WRO Restraints .................... 27

2.6 Seller’s Pre-COD Termination Right............................................................... 28

2.7 CEQA.................................................................................................................. 28 ARTICLE 3 PURCHASE AND SALE...................................................................................... 28

3.1 Purchase and Sale of Product........................................................................... 28

3.2 Sale of Green Attributes.................................................................................... 29

3.3 Imbalance Energy .............................................................................................. 29

3.4 Ownership of Renewable Energy Incentives................................................... 29

3.5 Future Environmental Attributes .................................................................... 29

3.6 Test Energy......................................................................................................... 29

3.7 CEC Certification and Verification ................................................................. 30

3.8 RPS Standard Terms and Conditions.............................................................. 30

3.9 Compliance Expenditure Cap........................................................................... 31

3.10 Project Configuration........................................................................................ 32 ARTICLE 4 OBLIGATIONS AND DELIVERIES................................................................... 32

4.1 Delivery ............................................................................................................... 32

4.2 Title and Risk of Loss........................................................................................ 33

4.3 Forecasting.......................................................................................................... 33

4.4 Dispatch Down/Curtailment ............................................................................. 34

4.5 Reduction in Delivery Obligation..................................................................... 35

4.6 Guaranteed Energy Production........................................................................ 36

4.7 WREGIS ............................................................................................................. 37

4.8 Interconnection Costs........................................................................................ 38 ARTICLE 5 TAXES .................................................................................................................. 38

5.1 Allocation of Taxes and Charges...................................................................... 38

5.2 Cooperation ........................................................................................................ 38 ARTICLE 6 OPERATIONS AND MAINTENANCE OF THE FACILITY ............................ 39

6.1 Operation and Maintenance of the Facility..................................................... 39

6.2 Maintenance of Health and Safety ................................................................... 39

6.3 Shared Facilities................................................................................................. 39 ARTICLE 7 METERING........................................................................................................... 40 123
ii

7.1 Metering.............................................................................................................. 40

7.2 Meter Verification.............................................................................................. 41 ARTICLE 8 INVOICING AND PAYMENT; CREDIT............................................................ 41

8.1 Invoicing.............................................................................................................. 41

8.2 Payment .............................................................................................................. 42

8.3 Books and Records............................................................................................. 42

8.4 Payment Adjustments; Billing Errors ............................................................. 42

8.5 Billing Disputes................................................................................................... 42

8.6 Netting of Payments........................................................................................... 43

8.7 Seller’s Development Security .......................................................................... 43

8.8 Seller’s Performance Security .......................................................................... 43

8.9 Buyer Credit Support........................................................................................ 44

8.10 First Priority Security Interest in Cash or Cash Equivalent Collateral....... 44

8.11 Financial Statements.......................................................................................... 45 ARTICLE 9 NOTICES .............................................................................................................. 46

9.1 Addresses for the Delivery of Notices............................................................... 46

9.2 Acceptable Means of Delivering Notice ........................................................... 46 ARTICLE 10 FORCE MAJEURE............................................................................................. 46

10.1 Definition ............................................................................................................ 46

10.2 No Liability If a Force Majeure Event Occurs ............................................... 47

10.3 Notice................................................................................................................... 47

10.4 Termination Following Force Majeure Event................................................. 48 ARTICLE 11 DEFAULTS; REMEDIES; TERMINATION..................................................... 48

11.1 Events of Default................................................................................................ 48

11.2 Remedies; Declaration of Early Termination Date ........................................ 51

11.3 Termination Payment........................................................................................ 52

11.4 Notice of Payment of Damage Payment or Termination Payment ............... 52

11.5 Disputes With Respect to Damage Payment or Termination Payment........ 52

11.6 Rights And Remedies Are Cumulative ............................................................ 53

11.7 Seller’s Pre-COD Liability Limitation............................................................. 53 ARTICLE 12 LIMITATION OF LIABILITY AND EXCLUSION OF WARRANTIES ........ 53

12.1 No Consequential Damages............................................................................... 53

12.2 Waiver and Exclusion of Other Damages........................................................ 53 ARTICLE 13 REPRESENTATIONS AND WARRANTIES; AUTHORITY.......................... 54

13.1 Seller’s Representations and Warranties ........................................................ 54

13.2 Buyer’s Representations and Warranties........................................................ 55

13.3 General Covenants............................................................................................. 55

13.4 Prevailing Wage ................................................................................................. 56 ARTICLE 14 ASSIGNMENT.................................................................................................... 56

14.1 General Prohibition on Assignments ............................................................... 56 124
iii

14.2 Collateral Assignment; Financing Cooperation.............................................. 57

14.3 Other Permitted Assignments and Transfers by Seller.................................. 57 ARTICLE 15 DISPUTE RESOLUTION................................................................................... 57

15.1 Governing Law................................................................................................... 57

15.2 Venue................................................................................................................... 57

15.3 Judicial Reference.............................................................................................. 57

15.4 Dispute Resolution ............................................................................................. 58 ARTICLE 16 INDEMNIFICATION ......................................................................................... 58

16.1 Indemnification .................................................................................................. 58 ARTICLE 17 INSURANCE ...................................................................................................... 58

17.1 Insurance ............................................................................................................ 58 ARTICLE 18 CONFIDENTIAL INFORMATION................................................................... 59

18.1 Definition of Confidential Information............................................................ 59

18.2 Duty to Maintain Confidentiality ..................................................................... 60

18.3 Irreparable Injury; Remedies........................................................................... 60

18.4 Disclosure to Lenders, Etc................................................................................. 61

18.5 Public Announcements...................................................................................... 61 ARTICLE 19 MISCELLANEOUS............................................................................................ 61

19.1 Entire Agreement; Integration; Exhibits......................................................... 61

19.2 Amendments....................................................................................................... 61

19.3 No Waiver ........................................................................................................... 61

19.4 No Agency, Partnership, Joint Venture or Lease ........................................... 61

19.5 Severability ......................................................................................................... 62

19.6 Mobile-Sierra...................................................................................................... 62

19.7 Counterparts; Electronic Signatures ............................................................... 62

19.8 Electronic Delivery............................................................................................. 62

19.9 Binding Effect..................................................................................................... 62

19.10 No Recourse to Members of Buyer................................................................... 62

19.11 Forward Contract; Inapplicability/Waiver of Bankruptcy Code Section 366 .......................................................................................................... 62

19.12 Further Assurances............................................................................................ 63

19.13 Change in Electric Market Design ................................................................... 63 125
iv
Exhibits:

Exhibit A Facility Description
Exhibit B Major Project Development Milestones and Commercial Operation Exhibit C Compensation
Exhibit D-1 Scheduling Coordinator Responsibilities
Exhibit D-2 Buyer and Seller Operating Coordination
Exhibit E Progress Reporting Form
Exhibit F-1 Form of Average Expected Energy Report
Exhibit F-2 Form of Monthly Available Generating Capacity Report Exhibit G Guaranteed Energy Production Damages Calculation Exhibit H Form of Commercial Operation Date Certificate Exhibit I Form of Installed Capacity Certificate
Exhibit J Form of Construction Start Date Certificate
Exhibit K Form of Letter of Credit issued on behalf of Seller for the benefit of Buyer Exhibit L Form of Guaranty
Exhibit M Reserved
Exhibit N Notices
Exhibit O Form of Consent and Agreement
Exhibit P Form of Estoppel Certificate
Exhibit Q Form of Letter of Credit issued on behalf of Buyer for the benefit of Seller Exhibit R Metering Diagram
Exhibit S Performance Test
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1 RENEWABLE POWER PURCHASE AGREEMENT
This Renewable Power Purchase Agreement (“Agreement”) is entered into as of _________, 2024 (the “Effective Date”), between Buyer and Seller. Buyer and Seller are sometimes referred to herein individually as a “Party” and jointly as the “Parties.” All capitalized terms used in this Agreement are used with the meanings ascribed to them in Article 1 to this Agreement.

RECITALS
WHEREAS, Seller intends to develop, construct, own or otherwise control, and operate the Facility; and
WHEREAS, Seller desires to sell, and Buyer desires to purchase, on the terms and conditions set forth in this Agreement, the Product;
NOW THEREFORE, in consideration of the mutual covenants and agreements herein contained, and for other good and valuable consideration, the sufficiency and adequacy of which are hereby acknowledged, the Parties agree to the following:

ARTICLE 1

DEFINITIONS

1.1 Contract Definitions. The following terms, when used herein with initial capitalization, shall have the meanings set forth below:
“AASMTC AD/CVD Case” means the filing of, and any proceedings, rulemakings, orders, determinations, tariffs, or duties related to, any of the Petitions for the Imposition of Antidumping and Countervailing Duties, filed on or around April 24, 2024 by the American Alliance for Solar Manufacturing Trade Committee, concerning Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled into Modules, from Cambodia, Malaysia, Thailand, and Vietnam, in any of the DOC dockets A-555-003, A-557-830, A-549-851, A-552-841, C-555-004, C-557-831, C-549-852, or C-552-842
“AC” means alternating current.
“Acceptable Issuer” means a U.S. commercial bank, or a foreign bank with a U.S. branch, with such bank having at least $10 billion of assets and having a Credit Rating of at least A- from S&P or A3 from Moody’s.
“Accepted Compliance Costs” has the meaning set forth in Section 3.9. “AD/CVD” means antidumping and/or countervailing duty.
“Adjusted Days of Liquidity on Hand” or “ADLH” means the calculation below using figures and terms from Buyer’s Audited Financial Statements published on Buyer’s website:
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2 “Adjusted Energy Production” has the meaning set forth in Exhibit G. “Affiliate” means, with respect to any Person, each Person that directly or indirectly controls, is controlled by, or is under common control with such designated Person. For purposes of this definition and the definition of “Permitted Transfer” and “Permitted Transferee”, “control” (including, with correlative meanings, the terms “controlled by”, and “under common control with”), as used with respect to any Person, shall mean (a) the direct or indirect right to cast at least fifty percent (50%) of the votes exercisable at an annual general meeting (or its equivalent) of such Person or, if there are no such rights, ownership of at least fifty percent (50%) of the equity or other ownership interest in such Person, or (b) the right to direct the policies or operations of such Person. Notwithstanding the foregoing, with respect to Seller, Affiliate shall include any investment funds or publicly-traded vehicles for the ownership of operating power generation, storage, or transmission assets (such as a “yield co”) controlled by Seller, NextEra Energy, Inc. or an Affiliate of NextEra Energy, Inc., NextEra Energy Partners, LP (“NEP”), NextEra Energy Operating Partners, LP (“NEOP”), and NextEra Energy Capital Holdings, Inc. (“NEECH”), and their respective direct or indirect subsidiaries.
“After-Tax Basis” means, with respect to any payment received, or deemed to have been received, by any Person, the amount of such payment (the “Base Payment”), supplemented by a further payment (the “Additional Payment”) to such Person so that the sum of the Base Payment plus the Additional Payment will be equal to the Base Payment, after deduction of the amount of all taxes required to be paid by such Person in respect of the receipt or accrual of the Base Payment and the Additional Payment (taking into account any current or previous credits or deductions arising from the underlying event giving rise to the payment, the Base Payment and the Additional Payment). Such calculations shall be made on the assumption that the recipient is subject to Federal income taxation at the statutory rate applicable to corporations under subchapter C of the Internal Revenue Code of 1986, as amended, and subject to the highest state and local income tax rate then in effect for corporations in the states in which the Person is subject to taxation during the applicable fiscal year, and shall take into account the deductibility, if applicable (for Federal income tax purposes), of state and local income taxes.
“Agreement” has the meaning set forth in the Preamble and includes any Exhibits, schedules and any written supplements hereto, the Cover Sheet, and any designated collateral, credit support or similar arrangement between the Parties. “Approved Forecast Vendor” means (i) CAISO, or in the event the CAISO no longer provides a forecast of Facility Energy for the Facility under the EIRP, then (ii) Seller or a Seller Affiliate, or if not Seller or a Seller Affiliate, a vendor selected by Seller for the purposes of providing or verifying the forecasts under Section 4.3(d) reasonably acceptable to Buyer, with such acceptance not to be unreasonably withheld, conditioned or delayed. “Auxin Anti-Circumvention Proceeding” means the DOC’s anti-circumvention investigation and proceeding concerning Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled into Modules, from the People's Republic of China, Petition filed February 8, 2022 by Auxin Solar, Inc. in four separate DOC dockets: A-570-979 Malaysia; Thailand; Cambodia; and Vietnam.
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3 “Available Generating Capacity” means the capacity of the Facility, expressed in whole MWs, that is mechanically available to generate Energy. “Bankrupt” means with respect to any entity, such entity that (a) files a petition or otherwise commences, authorizes or acquiesces in the commencement of a proceeding or cause of action under any bankruptcy, insolvency, reorganization or similar Law, (b) has any such petition filed or commenced against it which remains unstayed or undismissed for a period of ninety (90) days, (c) makes an assignment or any general arrangement for the benefit of creditors, (d) otherwise becomes bankrupt or insolvent (however evidenced), (e) has a liquidator, administrator, receiver, trustee, conservator or similar official appointed with respect to it or any substantial portion of its property or assets, or (f) is generally unable to pay its debts as they fall due. “Business Day” means any day except a Saturday, Sunday, or a Federal Reserve Bank holiday in California. A Business Day begins at 8:00 a.m. and ends at 5:00 p.m. local time for the Party sending a Notice, or payment, or performing a specified action. “Buyer” has the meaning set forth in the Cover Sheet.
“Buyer Bid Curtailment” means the occurrence of both of the following:
(a) the CAISO provides notice to a Party or the Scheduling Coordinator for the Facility, requiring the Party to deliver less Facility Energy than the full amount of Energy forecasted in accordance with Section 4.3(d) to be produced from the Facility for a period of time; and (b) for the same time period as referenced in (a), the notice referenced in (a) results from Buyer or the SC for the Facility, as the result of a Buyer instruction or lack of instruction to the SC:
(i) not having submitted a Self-Schedule or Energy Supply Bid for the MW subject to the reduction;
(ii) having submitted an Energy Supply Bid and the MW subject to the reduction were not awarded a schedule with respect to the Energy Supply Bid; or (iii) having submitted a Self-Schedule for less than the full amount of Energy forecasted to be generated by or delivered from the Facility in accordance with Section 4.3(d).

If the Facility is subject to a Planned Outage, Forced Facility Outage, Force Majeure Event and/or a Curtailment Period during the same time period as referenced in (a), then the calculation of Deemed Delivered Energy during such period shall not include any Facility Energy that was not generated due to such Planned Outage, Forced Facility Outage, Force Majeure Event, or Curtailment Order. For avoidance of doubt, if a Buyer Bid Curtailment and a CAISO system-wide overgeneration Curtailment Order occur in the same Settlement Interval or Settlement Period, the curtailment shall be treated as:
(i) a Buyer Bid Curtailment for the purpose of the calculation of Deemed Delivered Energy when there is a Negative LMP that is equal to or less than the Negative LMP Strike Price, or 129
4 (ii) a Curtailment Order for the purpose of the calculation of Deemed Delivery Energy when there is a Negative LMP that is greater than the Negative LMP Strike Price, subject to the following clarification, if Buyer or the SC (1) did not submit a Self-Schedule or Energy Supply Bid, or (2) failed to correctly submit or made an error with respect to a Self-Schedule or Energy Supply Bid, the curtailment shall be treated as a Buyer Bid Curtailment. “Buyer Curtailment Order” means an instruction from Buyer to Seller to reduce Energy from the Facility by the amount, and for the period of time set forth in such instruction (which for avoidance of doubt and without limiting the generality of the foregoing may include a Buyer instruction to reduce Energy when there is a Negative LMP that is equal to or less than the Negative LMP Strike Price), for reasons unrelated to Energy that was not generated due to a Planned Outage, Forced Facility Outage, Force Majeure Event and/or Curtailment Order. “Buyer Curtailment Period” means the period of time, as measured using current Settlement Intervals, during which Seller reduces Energy from the Facility pursuant to or as a result of (a) Buyer Bid Curtailment, (b) a Buyer Curtailment Order, or (c) any other action or omission by Buyer (or its agents) including a Buyer Default hereunder which directly causes Seller to be unable to deliver Facility Energy to the Delivery Point; provided, the duration of any Buyer Curtailment Period shall be inclusive of the time required for the Facility to ramp down and ramp up.
“Buyer Default” means a failure by Buyer (or its agents) to perform Buyer’s obligations hereunder, and includes an Event of Default of Buyer.
“Buyer’s WREGIS Account” has the meaning set forth in Section 4.7(a). “CAISO” means the California Independent System Operator Corporation or any successor entity performing similar functions.
“CAISO Approved Meter” means a CAISO approved revenue quality meter or meters, metering scheme, CAISO approved data processing gateway or remote intelligence gateway, telemetering equipment and data acquisition services, that comply with the CAISO Tariff, sufficient for monitoring, recording and reporting, in real time, all Facility Energy delivered to the Delivery Point.
“CAISO Grid” has the same meaning as “CAISO Controlled Grid” as defined in the CAISO Tariff.
“CAISO Metered Entity” has the meaning set forth in the CAISO Tariff. “CAISO Operating Order” means the Operating Instruction or Dispatch Instruction, as each are defined in the CAISO Tariff.
“CAISO Tariff” means the California Independent System Operator Corporation Agreement and Tariff, Business Practice Manuals (BPMs), and operating procedures, including the rules, protocols, procedures and standards attached thereto, as the same may be amended or modified from time-to-time and approved by FERC.
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5 “California Renewables Portfolio Standard” or “California RPS Program” or “RPS” means the “California Renewables Portfolio Standard” program and policies established by California State Senate Bills 1038 (2002), 1078 (2002), 107 (2008), X-1 2 (2011), 350 (2015), and 100 (2018) as codified in, inter alia, California Public Utilities Code Sections 399.11 through 399.31 and California Public Resources Code Sections 25740 through 25751, as such provisions are amended or supplemented from time to time, including without limitation all applicable eligibility criteria and requirements thereof and implemented under the Enforcement Procedures for the Renewables Portfolio Standard for Local Publicly Owned Electric Utilities, as adopted by the CEC on December 22, 2020, and as may be amended from time to time. “Capacity Damages” has the meaning set forth in Exhibit B. “CEC” means the California Energy Commission, or any successor agency performing similar statutory functions.
“CEC Certification and Verification” means that the CEC has certified (or, with respect to periods before the date that is one hundred eighty (180) days following the Commercial Operation Date, that the CEC has pre-certified, as such date may be extended pursuant to Section 3.9) that the Facility is an Eligible Renewable Energy Resource for purposes of the California Renewables Portfolio Standard and that all Facility Energy delivered to the Delivery Point qualifies as generation from an Eligible Renewable Energy Resource. “CEC Precertification” means that the CEC has issued a precertification for the Facility indicating that the planned operations of the Facility would comply with applicable CEC requirements for CEC Certification and Verification.
“CEQA” means the California Environmental Quality Act, California Public Resources Code §§ 21000, et seq. and Chapter 3 of Division 6 of Title 14 of the California Code of Regulations.
“CEQA Completion Date” has the meaning set forth in Section 2.7(a). “CEQA Documents” means an initial study, categorical exemption negative declaration, environmental impact report or equivalent document (as applicable) relied upon by the lead agency in connection with the CEQA environmental review for the Facility, including but not limited to any addendum, supplement, or subsequent negative declaration or environmental impact report. “Change in Law” means the occurrence, after the Effective Date, of any of the following:
(a) the adoption or implementation of any Law; (b) any change in any Law or in the administration, interpretation or application of any Law by any Governmental Authority; (c) the making or issuance of any request, guideline or directive (whether or not having the force of law) by any Governmental Authority; (d) any change to a Resource Adequacy Ruling; (e) any order, decision, resolution, rule, regulation, guidance document, or other determination of the CEC or the CPUC or its Energy Division, (f) any change in the CAISO Tariff or any document included in the definition thereof whether or not approved by FERC, or (g) any change in STC REC-1, STC REC2 or STC 6. “Change of Control” means, except in connection with public market transactions of 131
6 equity interests or capital stock of Seller’s Ultimate Parent, any circumstance in which Ultimate Parent ceases to own, directly or indirectly through one or more intermediate entities, more than fifty percent (50%) of the outstanding equity interests in Seller; provided that in calculating ownership percentages for all purposes of the foregoing:
(a) any ownership interest in Seller held by Ultimate Parent indirectly through one or more intermediate entities shall not be counted towards Ultimate Parent’s ownership interest in Seller unless Ultimate Parent directly or indirectly owns more than fifty percent (50%) of the outstanding equity interests in each such intermediate entity; and (b) ownership interests in Seller owned directly or indirectly by any Lender (including any cash equity or tax equity provider) shall be excluded from the total outstanding equity interests in Seller;
provided further, a Change of Control shall not be deemed to have occurred as a result of a Permitted Transfer.
“COD Certificate” has the meaning set forth in Exhibit B. “Collateral Assignment Agreement” has the meaning set forth in Section 14.2. “Commercial Operation” has the meaning set forth in Exhibit B. “Commercial Operation Date” has the meaning set forth in Exhibit B. “Commercial Operation Delay Damages” means an amount equal to (a) the Development Security amount required hereunder, divided by (b) one-hundred and eighty (180). “Committed Unused Bank Line” means the total amount of (a) bank lines of credit committed to Buyer which are for Buyer’s general use or that are dedicated for Buyer’s use with respect to this Agreement (which for avoidance of doubt shall not include any amounts which qualify under the following subsection (b), i.e., no “double counting”), or (b) funds committed to Buyer as security deposits by Participating Members under the Third Phase Agreement, to the extent the amount of (a) and (b) are (1) available for Buyer’s unrestricted use, or (2) solely dedicated for use by Buyer under this Agreement. Without limiting the generality of the immediately preceding sentence, but for clarification purposes, the term Committed Unused Bank Line does not include any bank lines of credit committed to Buyer, or any other funds provided to Buyer, which are dedicated to any other specific purpose (i.e., any specific purpose other than Buyer’s use under this Agreement).
“Compliance Actions” has the meaning set forth in Section 3.9. “Compliance Costs” has the meaning set forth in Section 3.9. “Compliance Expenditure Cap” has the meaning set forth in Section 3.9. “Confidential Information” has the meaning set forth in Section 18.1. 132
7 “Construction Start” has the meaning set forth in Exhibit B. “Construction Start Date” has the meaning set forth in Exhibit B. “Contract Price” has the meaning set forth on the Cover Sheet. “Contract Term” has the meaning set forth in Section 2.1(a). “Contract Year” means a period of twelve (12) consecutive months. The first Contract Year shall commence on the Commercial Operation Date and each subsequent Contract Year shall commence on the anniversary of the Commercial Operation Date. “Construction Start Delay Damages” means an amount equal to (a) the Development Security amount required hereunder, divided by (b) one-hundred and eighty (180). “Costs” means, with respect to the Non-Defaulting Party, brokerage fees, commissions and other similar third-party transaction costs and expenses reasonably incurred by such Party either in terminating any arrangement pursuant to which it has hedged or financed its obligations or entering into new arrangements which replace this Agreement; and all reasonable attorneys’ fees and expenses incurred by the Non-Defaulting Party in connection with terminating this Agreement. “Cover Sheet” means the cover sheet to this Agreement, which is incorporated into this Agreement.
“COVID-19” means the epidemic disease designated COVID-19 and the related virus designated SARS-CoV-2, and any mutations thereof.
“CPUC” means the California Public Utilities Commission or any successor agency performing similar statutory functions.
“Credit Rating” means, with respect to an entity other than Buyer, the current rating then assigned to that entity’s unsecured, senior long-term debt obligations (not supported by third party credit enhancements), or if that entity does not have a rating for its senior unsecured long-term debt, then the rating then assigned to such entity as an issuer rating by S&P, Fitch or Moody’s.

With respect to Buyer, the long term issuer rating assigned by S&P, Moody’s, and Fitch. If Buyer does not have a long term issuer rating, then the highest rating assigned to Buyer’s revenue bonds (not supported by third party credit enhancements).
“Curtailment Order” means any of the following:
(a) CAISO orders, directs, alerts, or provides notice to a Party or the SC, including a CAISO Operating Order, to curtail deliveries of Facility Energy for the following reasons: (i) any System Emergency, or (ii) any warning of an anticipated System Emergency, or warning of an imminent condition or situation, which jeopardizes CAISO’s electric system integrity or the integrity of other systems to which CAISO is connected; (b) a curtailment ordered by the Participating Transmission Owner for reasons including, but not limited to, (i) any situation that affects normal function of the electric system 133
8 including, but not limited to, any abnormal condition that requires action to prevent circumstances such as equipment damage, loss of load, or abnormal voltage conditions, or (ii) any warning, forecast or anticipation of conditions or situations that jeopardize the Participating Transmission Owner’s electric system integrity or the integrity of other systems to which the Participating Transmission Owner is connected;
(c) a curtailment ordered by CAISO or the Participating Transmission Owner; or (d) a curtailment in accordance with Seller’s obligations under its Interconnection Agreement with the Participating Transmission Owner or distribution operator.

For clarification, any notice, order, or instruction from the CAISO to curtail or reduce Facility Energy and/or the Facility that results from a Buyer Bid Curtailment or a Buyer Curtailment Order is not a Curtailment Order.
“Curtailment Period” means the period of time, as measured using current Settlement Intervals, during which generation from the Facility is reduced pursuant to a Curtailment Order; provided, the Curtailment Period shall be inclusive of the time required for the Facility to ramp down and ramp up.
“Damage Payment” means the dollar amount that equals the amount of the Development Security less (i) any amounts paid by Seller including without limitation any Construction Start Delay Damages or Commercial Operation Delay Damages, and further less (ii) any amounts which Buyer has drawn from the Development Security.
“Day-Ahead Forecast” has the meaning set forth in Section 4.3(c). “Day-Ahead Schedule” has the meaning set forth in the CAISO Tariff. “Dedicated Interconnection Capacity” means the maximum instantaneous amount of Facility Energy that is permitted to be delivered to the Delivery Point under the Interconnection Agreement, in the amount of MWs as set forth on the Cover Sheet “Deemed Delivered Energy” means the amount of Energy expressed in MWh that the Facility would have produced and delivered to the Delivery Point, but that is not produced by the Facility during a Buyer Curtailment Period, which amount shall, for any time period, be equal to the difference between (a) the full amount of Energy forecasted to be produced by the Facility in accordance with Section 4.3(d) during a Buyer Curtailment Period, and any adjustments necessary to accurately reflect the Facility’s capacity to produce and deliver energy to the Delivery Point, including applicable losses and manufacturers’ applicable performance data, subject to Buyer’s verification not to be unreasonably withheld, minus (b) the amount of energy that the Facility produced and delivered to the Delivery Point during the Buyer Curtailment Period; provided that, if the applicable difference between the foregoing clauses (a) and (b) is negative, the Deemed Delivered Energy shall be zero (0). For the purpose of clarity, Deemed Delivered Energy does not include the amount of Energy expressed in MWh that the Facility would have produced and delivered to the Delivery Point, but that is not produced by the Facility during a Curtailment Period. “Defaulting Party” has the meaning set forth in Section 11.1(a). 134
9 “Deficient Month” has the meaning set forth in Section 4.7(e). “Delivery Point” has the meaning set forth in Exhibit A. “Delivery Term” shall mean the period of Contract Years set forth on the Cover Sheet beginning on the Commercial Operation Date, unless terminated earlier in accordance with the terms and conditions of this Agreement.
“Development Cure Period” has the meaning set forth in Exhibit B. “Development Security” means (a) cash or (b) a Letter of Credit in the amount set forth on the Cover Sheet.
“Disclosing Party” has the meaning set forth in Section 18.1. “DOC” means the U.S. Department of Commerce.
“Early Termination Date” has the meaning set forth in Section 11.2(a). “Effective Date” has the meaning set forth on the Preamble. “Electrical Losses” means all transmission or transformation losses between the Facility and the Delivery Point, calculated in accordance with CAISO approved methodologies applicable to revenue metering.
“Eligible Intermittent Resources Protocol” or “EIRP” means the Eligible Intermittent Resource Protocol, as may be amended from time to time, as set forth in the CAISO Tariff. “Eligible Renewable Energy Resource” has the meaning set forth in California Public Utilities Code Section 399.12(e) and California Public Resources Code Section 25741(a), as either code provision is amended or supplemented from time to time. “Energy” means electrical energy generated by the Facility. “Energy-Only Deliverability Status” has the meaning set forth in the CAISO Tariff. “Energy Supply Bid” has the meaning set forth in the CAISO Tariff. “Estoppel Certificate” has the meaning set forth in Section 14.2 and substantially in the form attached as Exhibit P.
“Event of Default” has the meaning set forth in Section 11.1. “Excess MWh” has the meaning set forth in Exhibit C.
“Executed Interconnection Agreement Milestone” means the date for completion of execution of the Interconnection Agreement by Seller (or Seller’s Affiliate) and the PTO as set forth on the Cover Sheet.
135
10 “Expected Energy” means the quantity of Energy that Seller expects to be able to deliver to Buyer from the Facility during each Contract Year or other time period in the quantity specified on the Cover Sheet.
“Facility” means the solar photovoltaic generating facility described on the Cover Sheet and in Exhibit A, located at the Site and including mechanical equipment and associated facilities and equipment (but excluding any Shared Facilities) required to deliver Energy to the Delivery Point.
“Facility Energy” means Energy delivered to the Delivery Point, net of Electrical Losses and Station Use, as measured by the Facility Meter, which Facility Meter will be adjusted in accordance with CAISO meter requirements and Prudent Operating Practices to account for Electrical Losses and Station Use.
“Facility Meter” means the CAISO Approved Meter that will measure all Facility Energy and is dedicated exclusively to the Facility.
“FERC” means the Federal Energy Regulatory Commission or any successor government agency.
“Fitch” means Fitch Ratings Ltd., or its successor.
“Force Majeure Event” has the meaning set forth in Section 10.1. “Forced Facility Outage” means an unexpected failure of one or more components of the Facility that prevents Seller from generating Energy or making Facility Energy available at the Delivery Point and that is not the result of a Force Majeure Event. For the purpose of clarity, a “Forced Facility Outage” is equivalent to a “Forced Outage” as such term is defined in the CAISO Tariff.
“Full Capacity Deliverability Status” has the meaning set forth in the CAISO Tariff. “Full Network Model” has the meaning set forth in the CAISO Tariff. “Future Environmental Attributes” shall mean, except to the extent set forth in the last sentence of this definition, any and all generation attributes (other than Green Attributes or Renewable Energy Incentives) which are newly recognized after the Effective Date under the RPS regulations or under any and all other international, federal, regional, state or other law, rule, regulation, bylaw, treaty or other intergovernmental compact, decision, administrative decision, program (including any voluntary compliance or membership program), competitive market or business method (including all credits, certificates, benefits, and emission measurements, reductions, offsets and allowances related thereto) that are attributable to the generation of electrical energy by the Facility and its displacement of conventional energy generation. Future Environmental Attributes do not include (i) any energy, capacity, reliability or other power attributes from the Facility, (ii) Renewable Energy Incentives including Tax Benefits including without limitation production tax credits or investment tax credits associated with the development, construction, operation or ownership of the Facility, or other financial incentives in the form of credits, reductions, or allowances associated with the Facility that are applicable to a 136
11 state or federal income taxation obligation, (iii) fuel-related subsidies or “tipping fees” that may be paid to Seller to accept certain fuels, or local subsidies received by the generator for the destruction of particular preexisting pollutants or the promotion of local environmental benefits, or (iv) emission reduction credits encumbered or used by the Facility for compliance with local, state, or federal operating and/or air quality permits. “Gains” means, with respect to any Non-Defaulting Party, an amount equal to the present value of the economic benefit to it, if any (exclusive of Costs), resulting from the termination of this Agreement for the remaining Contract Term, determined in a commercially reasonable manner. Factors used in determining the economic benefit to a Non-Defaulting Party may include, without limitation, reference to information supplied by one or more third parties, which shall exclude Affiliates of the Non-Defaulting Party, including without limitation, quotations (either firm or indicative) of relevant rates, prices, yields, yield curves, volatilities, spreads or other relevant market data in the relevant markets, comparable transactions, forward price curves based on economic analysis of the relevant markets, settlement prices for comparable transactions at liquid trading hubs (e.g., SP-15), all of which should be calculated for the remaining Contract Term, and include the value of Green Attributes.
“Governmental Authority” means any federal, state, provincial, local or municipal government, any political subdivision thereof or any other governmental, congressional or parliamentary, regulatory, or judicial instrumentality, authority, body, agency, department, bureau, or entity with authority to bind a Party at law, including CAISO; provided, however, that “Governmental Authority” shall not in any event include any Party, and in Buyer’s case, its Participating Members as well.
“Green Attributes” means any and all credits, benefits, emissions reductions, offsets, and allowances, howsoever entitled, attributable to the generation from the Facility, and its avoided emission of pollutants and displacement of conventional energy generation. Green Attributes include but are not limited to PCC1 Renewable Energy Credits, as well as: (1) any avoided emission of pollutants to the air, soil or water such as sulfur oxides (SOx), nitrogen oxides (NOx), carbon monoxide (CO) and other pollutants; (2) any avoided emissions of carbon dioxide (CO2), methane (CH4), nitrous oxide, hydrofluorocarbons, perfluorocarbons, sulfur hexafluoride and other greenhouse gases (GHGs) that have been determined by the United Nations Intergovernmental Panel on Climate Change, or otherwise by law, to contribute to the actual or potential threat of altering the Earth’s climate by trapping heat in the atmosphere; (3) the reporting rights to these avoided emissions, such as PCC1 Renewable Energy Credits or Green Tag Reporting Rights. Green Tags and PCC1 Renewable Energy Credits are accumulated on a MWh basis and one Green Tag or PCC 1 Renewable Energy Credit represents the Green Attributes associated with one (1) MWh of Energy. Green Attributes as defined herein are limited to Green Attributes that exist under applicable Law as of the Effective Date. Green Attributes do not include (i) any energy, capacity, reliability or other power attributes from the Facility, (ii) Renewable Energy Incentives including Tax Benefits including without limitation production tax credits or investment tax credits associated with the development, construction, operation or ownership of the Facility and other financial incentives in the form of credits, reductions, or allowances associated with the Facility that are applicable to a state or federal income taxation obligation, (iii) fuel-related subsidies or “tipping fees” that may be paid to Seller to accept certain fuels, or local subsidies received by the generator for the destruction of particular preexisting pollutants or the 137
12 promotion of local environmental benefits, or (iv) emission reduction credits encumbered or used by the Facility for compliance with local, state, or federal operating or air quality permits. “Green Tag Purchaser” means Buyer.
“Green Tag Reporting Rights” means the right of a Green Tag Purchaser to report the ownership of accumulated Green Tags in compliance with federal or state law, if applicable, and to a federal or state agency or any other party at the Green Tag Purchaser’s discretion, and include without limitation those Green Tag Reporting Rights accruing under Section 16.5(b) of The Energy Policy Act of 1992 and any present or future federal, state, or local law, regulation or bill, and international or foreign emission trading program, including pursuant to the WREGIS Operating Rules.
“Guaranteed Capacity” means the amount of generating capacity of the Facility, as measured in MWAC at the Delivery Point (i.e., measured at the Facility Meter as such meter readings at the Facility Meter are adjusted by the CAISO for any applicable Electrical Losses and Station Use to the extent such Electrical Losses and Station Use are not already reflected in the Facility Meter measurements), set forth on the Cover Sheet, as the same may be adjusted pursuant to Section 5 of Exhibit B.
“Guaranteed Commercial Operation Date” has the meaning set forth on the Cover Sheet, subject to extension pursuant to Exhibit B.
“Guaranteed Construction Start Date” has the meaning set forth on the Cover Sheet, subject to extension pursuant to Exhibit B.
“Guaranteed Energy Production” means an amount of Adjusted Energy Production equal to eighty percent (80%) of the Expected Energy for the applicable Performance Measurement Period.
“Guarantor” means, with respect to Seller, (a) NextEra Energy Capital Holdings, Inc., (b) an Affiliate of Seller with an Investment Grade Credit Rating, or (c) any Person reasonably acceptable to Buyer, that (i) has an Investment Grade Credit Rating, (ii) has a tangible net worth of at least One Hundred Fifty Million Dollars ($150,000,000), (iii) is incorporated or organized in a jurisdiction of the United States and is in good standing in such jurisdiction, and (iv) executes and delivers a Guaranty for the benefit of Buyer.
“Guaranty” means a guaranty from a Guarantor provided for the benefit of Buyer substantially in the form attached as Exhibit L.
“Imbalance Energy” means the amount of energy in MWh, in any given Settlement Period or Settlement Interval, by which the amount of Facility Energy deviates from the amount of Scheduled Energy.
“Independent Report” has the meaning set forth in Section 2.5(b). “Initial Synchronization” means the initial delivery of Facility Energy to the Delivery Point.
138
13 “Installed Capacity” means the actual generating capacity of the Facility, as measured in MWAC at the Delivery Point, that achieves Commercial Operation, as evidenced by a certificate substantially in the form attached as Exhibit I hereto; provided, the Installed Capacity may not exceed the Guaranteed Capacity.
“Interconnection Agreement” means the interconnection agreement(s) entered into by Seller or Seller’s Affiliate pursuant to which the Facility will be interconnected with the Transmission System, and pursuant to which Seller’s Interconnection Facilities and any other Interconnection Facilities will be constructed, operated and maintained during the Contract Term. “Interconnection Facilities” means the interconnection facilities, control and protective devices and metering facilities required to connect the Facility with the Transmission System in accordance with the Interconnection Agreement.
“Interest Rate” has the meaning set forth in Section 8.2. “Inter-SC Trade” or “IST” has the meaning set forth in the CAISO Tariff. “Interim Deliverability Status” has the meaning set forth in the CAISO Tariff. “Investment Grade Credit Rating” means a Credit Rating of at least BBB- from S&P, BBB- from Fitch, or Baa3 from Moody’s. If ratings by S&P, Fitch, and Moody’s are not equivalent, the highest two ratings shall apply. For avoidance of doubt, a Credit Rating from more than one credit agency is not necessary for a Party to demonstrate an Investment Grade Credit Rating.
“ITC” means the investment tax credit established pursuant to Section 48, 48E or other applicable provisions of the United States Internal Revenue Code of 1986, as in effect from timeto-time throughout the Contract Term or any successor provision. “Joint Powers Act” means the provisions of the California Joint Exercise of Powers Act found in Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California, beginning at California Government Code Section 6500, et seq. “Joint Powers Agreement” means the Amended and Restated Northern California Power Agency Joint Exercise of Power Agreement dated as of January 31, 2008, as such agreement may be further amended or amended and restated from time to time, under which Buyer is organized as a Joint Powers Agency in accordance with the Joint Powers Act. “Law” means any applicable law, statute, rule, regulation, decision, writ, order, decree or judgment, permit or any interpretation thereof, promulgated or issued by a Governmental Authority.
“Lead Agency” means the public agency with the principal responsibility for approving the Facility or relevant portion thereof as defined pursuant to CEQA, 14 C.C.R. § 15367. “Lender” means, collectively, any Person (a) providing senior or subordinated construction, interim, back leverage, mezzanine, or long-term debt, equity, or tax equity financing 139
14 or refinancing for or in connection with the development, construction, purchase, installation, or operation of the Facility, whether that financing or refinancing takes the form of private debt (including back-leverage debt), equity (including cash or tax equity), public debt, or any other form (including financing or refinancing provided to a member or other direct or indirect owner of Seller), including any equity or tax equity investor directly or indirectly providing financing or refinancing for the Facility or purchasing equity ownership interests of Seller and/or its Affiliates, and any trustee or agent or similar representative acting on their behalf, (b) providing interest rate or commodity protection under an agreement hedging or otherwise mitigating the cost of any of the foregoing obligations, (c) participating in a lease financing (including a sale leaseback or leveraged leasing structure) with respect to the Facility, or (d) acting as issuing bank for any Letter(s) of Credit issued pursuant hereto or in connection with the Facility. “Letter(s) of Credit” means one or more irrevocable, standby letters of credit, issued by an Acceptable Issuer, in a form substantially similar to the letter of credit set forth in (a) Exhibit K if issued on behalf of Seller for the benefit of Buyer, and (b) Exhibit Q if issued on behalf of Buyer for the benefit of Seller, each as applicable.
“Licensed Professional Engineer” means an independent, professional engineer selected by Seller and reasonably acceptable to Buyer, licensed in the State of California. “Locational Marginal Price” or “LMP” has the meaning set forth in the CAISO Tariff. “Losses” means, with respect to the Non-Defaulting Party, an amount equal to the present value of the economic loss to it, if any (exclusive of Costs), resulting from termination of this Agreement for the remaining Contract Term, determined in a commercially reasonable manner.

Factors used in determining economic loss to a Non-Defaulting Party may include, without limitation, reference to information supplied by one or more third parties, which shall exclude Affiliates of the Non-Defaulting Party, including without limitation, quotations (either firm or indicative) of relevant rates, prices, yields, yield curves, volatilities, spreads or other relevant market data in the relevant markets, comparable transactions, forward price curves based on economic analysis of the relevant markets, settlement prices for comparable transactions at liquid trading hubs (e.g., SP-15), all of which should be calculated for the remaining Contract Term, as applicable, and must include the value of Green Attributes and Renewable Energy Incentives. “Lost Output” has the meaning set forth in Section 4.6. “Major Project Development Milestone” has the meaning set forth in in Exhibit B. “Master File” has the meaning set forth in the CAISO Tariff. “Meter Service Agreement for Metered Entities” or “MSA” has the meaning set forth in the CAISO Tariff.
“Milestones” means the development activities for significant interconnection and construction milestones set forth on the Cover Sheet.
“Monthly Delivery Forecast” has the meaning set forth in Section 4.3(b). 140
15 “Moody’s” means Moody’s Investors Service, Inc., or its successor. “MW” means megawatts in alternating current, unless expressly stated in terms of direct current.
“MWh” means megawatt-hour measured in alternating current, unless expressly stated in terms of direct current.
“NEECH” has the meaning set forth in the definition of Affiliate. “NEER” means NextEra Energy Resources, LLC.
“Negative LMP” means, in any Settlement Period or Settlement Interval, the Day-Ahead Market or Real-Time Market at the Facility’s PNode is less than Zero dollars ($0). “Negative LMP Strike Price” means zero dollars per MWh ($0/MWh), as such price may be revised by Buyer at its sole discretion (provided the revised price is less than or equal to Zero dollars ($0)) by providing Notice to Seller in accordance with Exhibit C. “NEOP” has the meaning set forth in the definition of Affiliate. “NEP” has the meaning set forth in the definition of Affiliate. “NERC” means the North American Electric Reliability Corporation or any successor entity performing similar functions.
“Network Upgrades” has the meaning set forth in the CAISO Tariff. “New PV Trade Measure Event” means any of the following events, during the period while the applicable ruling request, inquiry, rulemaking, or other filing or proceeding remains pending or subject to appeal before the DOC or other applicable Governmental Authority:
i. Filing of any anti-circumvention ruling request alleging that manufacturers or importers are circumventing any AD/CVD orders on PV Equipment; ii. Initiation of any anti-circumvention inquiry into whether manufacturers or importers are circumventing any AD/CVD orders on PV Equipment or issuance in any such inquiry of any finding or ruling that manufacturers or importers are circumventing any AD/CVD orders on PV Equipment; or
iii. Filing or initiation of any rulemakings, adjudications, or other proceedings or actions to increase, extend, or expand application of, or impose any new, tariffs, duties (including but not limited to AD/CVD), or other trade measures, or issuance of any related determinations, orders, tariffs, duties, or trade measures, on PV Equipment.

For the avoidance of doubt, the Parties acknowledge that any of the following shall trigger the occurrence of a New PV Trade Measure Event with respect to the Auxin Anti-Circumvention Proceeding: (a) any legislative, judicial, or administrative challenge to, or withdrawal (in whole 141
16 or in part) of, (I) that certain Declaration of Emergency and Authorization for Temporary Extensions of Time and Duty-Free Importation of Solar Cells and Modules from Southeast Asia, by the President of the United States, dated June 6, 2022, or supporting Presidential Determination Pursuant to Section 303 of the Defense Production Act, or (II) any implementation thereof by the DOC or other Governmental Authority, including through any rulemaking; or (b) any legislative, judicial, or administrative challenge that seeks to expand the scope of the DOC’s final affirmative circumvention determinations, as published on August 23, 2023 in 88 Fed. Reg. 57,419, to cover companies or activities excluded in such final affirmative determinations, or to narrow the scope of, or vacate or reverse, any negative circumvention determinations or guidance on avoiding circumvention in such published issuance. The Parties further acknowledge that the AASMTC AD/CVD Case constitutes a New PV Trade Measure Event.
“Non-Defaulting Party” has the meaning set forth in Section 11.2. “Notice” shall, unless otherwise specified in this Agreement, mean written communications by a Party to be delivered by hand delivery, United States mail, next Business Day courier service, or electronic messaging (e-mail).
“Participating Generator Agreement” has the meaning set forth in the CAISO Tariff. “Participating Member” means a member of Buyer that is signatory to the Third Phase Agreement. As of the Effective Date, such Participating Members are _________; if the Participating Members change after the Effective Date, Buyer shall provide written notice to Seller confirming the then-current list of Participating Members that are signatory to the Third Phase Agreement, and such written notice shall not be considered to be an amendment to this Agreement. “Participating Transmission Owner” or “PTO” means an entity that owns, operates and maintains transmission or distribution lines and associated facilities or has entitlements to use certain transmission or distribution lines and associated facilities where the Facility is interconnected. For purposes of this Agreement, the Participating Transmission Owner is set forth in Exhibit A.
“Party” or “Parties” has the meaning set forth in the Preamble. “Performance Measurement Period” means each two (2) consecutive Contract Year periods during the Delivery Term, calculated on a non-rolling basis such that no Contract Year is included in more than one Performance Measurement Period. The first Performance Measurement Period shall include Contract Years 1 and 2. The second Performance Measurement Period shall be comprised of Contract Years 3 and 4, and so on.
“Performance Security” means (a) cash or (b) a Letter of Credit or (c) a Guaranty in the amount set forth on the Cover Sheet.
“Permitted Transfer” means each of the following transactions:
(a) Transactions among Affiliates of Seller, including any corporate reorganization, merger, combination or similar transaction or transfer of assets or ownership interests involving Seller or its Affiliates; provided (i)(A) Ultimate Parent retains the authority, directly or indirectly, 142
17 to control the entity that is the Seller after such transactions, or (B) a wholly-owned, indirect subsidiary of Ultimate Parent operates the Facility, and (ii) if such transactions transfer this Agreement to any entity other than the entity that is the Seller before such transactions (including transfers by operation of law pursuant to transactions in which Seller is not the surviving entity), the transferee (A) executes and delivers to Buyer a written agreement under which the transferee assumes in writing all of Seller’s duties and obligations under this Agreement and otherwise agrees to be bound by all of the terms and conditions of this Agreement, and (B) satisfies the Seller Development Security requirements and Performance Security requirements; (b) A Change of Control of Ultimate Parent;
(c) Any change of economic and voting rights triggered in Seller’s organization documents arising from the financing of the Facility and that does not result in the transfer of ownership, economic or voting rights in any entity that had no such rights immediately prior to the change;
(d) The direct or indirect transfer of shares of, or equity interests in, Seller to a Lender; (e) An assignment of the Agreement, or the transfer of the Facility or the direct or indirect ownership of equity interests in Seller, to a Permitted Transferee; or (f) A transfer of the Facility (or the direct or indirect ownership of equity interests in Seller) in connection with any of the following transfers: (i) all or substantially all of the assets of NEER, NEECH, or Ultimate Parent; (ii) all or substantially all of NEER’s or Ultimate Parent’s renewable energy generation portfolio; or (iii) all or substantially all of NEER’s or Ultimate Parent’s solar generation and/or energy storage portfolio; or (iv) the direct or indirect transfer of shares of, or equity interests in, Seller to a person in which, following the transfer, an Affiliate of NEER continues to hold an economic interest in the Facility; provided, that in the case of each of (i) through (iv) above: (A) the transferee (1) executes and delivers to Buyer a written agreement under which the transferee assumes in writing all of Seller’s duties and obligations under this Agreement and otherwise agrees to be bound by all of the terms and conditions of this Agreement, and (2) meets the Seller credit security requirements; and (B) the entity that operates the Facility following such transfer is (or contracts with) a Qualified Operator. “Permitted Transferee” means (a) any Affiliate of Seller, or (b) any entity that satisfies, or is controlled by another Person that satisfies, the following requirements:
(i) A Tangible Net Worth of not less than One Hundred Fifty Million Dollars ($150,000,000) or a Credit Rating of at least BBB- from S&P, BBB- from Fitch, or Baa3 from Moody’s; and
(ii) At least two (2) years of experience in the ownership and operations of power generation facilities similar to the Facility, or has retained a third-party with such experience to operate the Facility.

Notwithstanding the foregoing, with respect to Seller, Permitted Transferee shall include its Ultimate Parent, NEER, NEECH, NEOP, and NEP, and their respective direct or indirect subsidiaries.
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18 “Person” means any individual, sole proprietorship, corporation, limited liability company, limited or general partnership, joint venture, association, joint-stock company, trust, incorporated organization, institution, public benefit corporation, unincorporated organization, government entity or other entity.
“Planned Outage” means a period during which the Facility is either in whole or in part not capable of providing service due to planned maintenance that has been scheduled in advance in accordance with Section 4.5(a). For the purpose of clarity, a “Planned Outage” is equivalent to a “Planned Outage” as such term is defined in the CAISO Tariff. “PNode” has the meaning set forth in the CAISO Tariff.
“Portfolio” means the single portfolio of electrical energy generating, energy storage, or other assets and entities, including the Facility (or the interests of Seller or Seller’s Affiliates or the interests of their respective direct or indirect parent companies), that entails assets in the United States, that is pledged as collateral security in connection with a Portfolio Financing. “Portfolio Content Category” means PCC1, PCC2 or PCC3, as applicable. “Portfolio Content Category 1” or “PCC1” means any Renewable Energy Credit associated with the generation of electricity from an Eligible Renewable Energy Resource consisting of the portfolio content set forth in California Public Utilities Code Section 399.16(b)(1), as may be amended from time to time or as further defined or supplemented by Law.
“Portfolio Financing” means any equity (including tax equity) financings or debt transactions entered into by an Affiliate of Seller that is secured only by a Portfolio. “Portfolio Financing Entity” means any Affiliate of Seller that enters into a tax equity transaction or incurs debt in connection with any Portfolio Financing. “Product” has the meaning set forth on the Cover Sheet. For the purpose of clarity, Product shall include (i) Facility Energy, and (ii) Green Attributes, including, but not limited to, Portfolio Content Category 1 Renewable Energy Credits (in each case not to exceed the quantity of Facility Energy and associated Green Attributes available from the Installed Capacity). “Progress Report” means a progress report including the items set forth in Exhibit E. “Proposed Contract Price Increase” has the meaning set forth in Section 2.5(b). “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 utility and independent power producer industry during the relevant time period with respect to grid-interconnected, utility-scale generating facilities 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 144
19 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 industry with respect to grid-interconnected, utility-scale generating facilities in the Western United States. Prudent Operating Practice includes compliance with applicable Laws, applicable reliability criteria, and the applicable criteria, rules and standards promulgated in the National Electric Safety Code and the National Electrical Code, as they may be amended or superseded from time to time, including the criteria, rules and standards of any successor organizations. “PTC” means the production tax credit established pursuant to Section 45 or 45Y or other applicable provisions of the United States Internal Revenue Code of 1986, as in effect as of the Commercial Operation Date, adjusted for inflation during the period any such PTCs are received as permitted under such applicable provisions of the United States Internal Revenue Code as of the Commercial Operation Date.
“PTC Amount” means the amount, on a dollar per MWh basis, equal to the PTCs that Seller would have earned in respect of Facility Energy at the time, grossed up on an After-Tax Basis at the then-highest marginal combined federal and state corporate tax rate, but failed to earn as a result of Buyer Bid Curtailment, Buyer Curtailment Order, or any other action or omission by Buyer (or its agents) including a Buyer Default which causes Seller to be unable to deliver Facility Energy to the Delivery Point, with the applicable MWh figure to be calculated by reference to the amount of Deemed Delivered Energy; provided, however the PTC Amount shall not be greater than $40.00 per MWh as of the Commercial Operation Date, and as subsequently adjusted for inflation during the period any such PTC Amounts are received by Seller, where the period of time any such PTC Amounts are received by Seller shall not exceed a total period of 10 years. “PV Equipment” means solar photovoltaic cells, modules, onboard sensors, control components, inverters, or any of their components.
“Qualified Operator” means Seller (either itself or through the engagement of an Affiliate) or an operator of photovoltaic solar generation facilities that has sufficient experience and technical capability to perform for Seller’s benefit the obligations of Seller under this Agreement related to the operation and maintenance of the Facility in accordance with the applicable requirements of this Agreement, as evidenced by such operator having operated two (2) or more photovoltaic solar generation facilities, each having a nameplate capacity rating of twenty (20) MW or more, for not less than two (2) years.
“Qualified Reporting Entity” or “QRE” has the meaning set forth in the WREGIS Operating Rules.
“Real-Time Forecast” has the meaning set forth in Section 4.3(d). “Real-Time Market” has the meaning set forth in the CAISO Tariff. “Real-Time Price” means the Resource-Specific Settlement Interval LMP as defined in the CAISO Tariff. If there is more than one applicable Real-Time Price for the same period of time, Real-Time Price shall mean the price associated with the smallest time interval. “Receiving Party” has the meaning set forth in Section 18.1. 145
20 “Recurring Certificate Transfer” has the meaning set forth in Section 4.7(a). “Remedial Action Plan” has the meaning set forth in Section 2.4. “Renewable Energy Credit” or “REC” means a renewable energy credit as defined by and in accordance with Section 399.12(h) of the California Public Utilities Code, including the right to claim title to the Green Attributes attributable to the generation of electric generation from an Eligible Renewable Energy Resources, as may be amended from time to time or as further defined or supplemented by Law.
“Renewable Energy Incentives” means: (a) all federal, state, or local Tax credits or other Tax benefits associated with the production of electricity from, or the construction, operation or the ownership of, the Facility or any part thereof (including the Tax Benefits and other credits under Sections 38, 45, 45Y, 46, 48, and 48E of the Internal Revenue Code of 1986, as amended); (b) any federal, state, or local grants, subsidies or other like benefits relating in any way to the Facility, including a cash grant available under Section 1603 of Division B of the American Recovery and Reinvestment Act of 2009, in lieu of federal Tax credits or any similar or substitute payment available under subsequently enacted federal legislation; and (c) any other form of incentive relating in any way to the Facility that is not a Green Attribute, or Future Environmental Attribute.
“S&P” means the Standard & Poor’s Financial Services, LLC (a subsidiary of S&P Global Inc.) or its successor.
“Schedule” has the meaning set forth in the CAISO Tariff, and “Scheduled” has a corollary meaning.
“Scheduled Energy” means the Facility Energy that clears under the applicable CAISO market based on the final Day-Ahead Schedule, FMM Schedule (as defined in the CAISO Tariff), or any other financially binding Schedule, market instruction or dispatch for the Facility for a given period of time implemented in accordance with the CAISO Tariff. “Scheduling Coordinator” or “SC” means an entity certified by the CAISO as qualifying as a Scheduling Coordinator pursuant to the CAISO Tariff for the purposes of undertaking the functions specified in “Responsibilities of a Scheduling Coordinator,” of the CAISO Tariff, as amended from time to time.
“Scheduling Coordinator Metered Entity” has the meaning set forth in the CAISO Tariff.
“Security Interest” has the meaning set forth in Section 8.10. “Self-Schedule” has the meaning set forth in the CAISO Tariff. “Seller” has the meaning set forth on the Cover Sheet.
“Seller’s WREGIS Account” has the meaning set forth in Section 4.7(a). 146
21 “Settlement Amount” means the Non-Defaulting Party’s Costs and Losses, on the one hand, netted against its Gains, on the other. If the Non-Defaulting Party’s Costs and Losses exceed its Gains, then the Settlement Amount shall be an amount owing to the Non-Defaulting Party. If the Non-Defaulting Party’s Gains exceed its Costs and Losses, then the Settlement Amount shall be zero dollars ($0). The Settlement Amount does not include consequential, incidental, punitive, exemplary or indirect or business interruption damages; provided, that the Parties agree that the value of Green Attributes and Renewable Energy Incentives are direct damages to be accounted for as specified in the definitions of Losses and Gains. “Settlement Interval” has the meaning set forth in the CAISO Tariff. “Settlement Period” has the meaning set forth in the CAISO Tariff. “Settlement Quality Meter Data” has the meaning set forth in the CAISO Tariff. “Shared Facilities” means the gen-tie lines, transformers, substations, or other equipment, permits, contract rights, and other assets and property (real or personal), in each case, as necessary to enable delivery of Energy from the Facility (which is excluded from Shared Facilities) to the point of interconnection, including the Interconnection Agreement itself, that are used in common with Affiliates and/or other third parties or by Seller for electric generation or storage facilities owned by Seller other than the Facility.
“Site” means the real property on which the Facility is or will be located, as further described in Exhibit A and as shall be updated by Seller at the time Seller provides an executed Construction Start Date certificate in the form of Exhibit J to Buyer. “Site Control” means that Seller or its Affiliate for the Delivery Term: (a) owns or has the option to purchase the Site; (b) is the lessee or has the option to lease the Site; or (c) is the holder of an easement or an option for an easement, right-of-way grant, or similar instrument with respect to the Site.
“SP-15” means the Existing Zone Generation Trading Hub for Existing Zone region SP15 as set forth in the CAISO Tariff.
“SQMD Plan” has the meaning set forth in the CAISO Tariff. “Station Use” means:
(a) The Energy generated by the Facility that is used within the Facility to power the lights, motors, control systems and other electrical loads that are necessary for operation of the Facility; and
(b) The Energy generated by the Facility that is consumed within the Facility’s electric energy distribution system as losses.

For the purpose of clarity Seller shall not use Energy generated by the Facility to charge a battery energy storage system and claim such as Station Use.
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22 “System Emergency” means any condition that requires, as determined and declared by CAISO or the PTO, automatic or immediate action to (a) prevent or limit harm to or loss of life or property, (b) prevent loss of transmission facilities or generation supply in the immediate vicinity of the Facility, or (c) to preserve Transmission System reliability. “Tangible Net Worth” means the tangible assets (for example, not including intangibles such as goodwill and rights to patents or royalties) that remain after deducting liabilities as determined in accordance with generally accepted accounting principles. “Tax” or “Taxes” means all U.S. federal, state and local and any foreign taxes, levies, assessments, surcharges, duties and other fees and charges of any nature imposed by a Governmental Authority, whether currently in effect or adopted during the Contract Term, including ad valorem, excise, franchise, gross receipts, import/export, license, property, sales and use, stamp, transfer, payroll, unemployment, income, and any and all items of withholding, deficiency, penalty, additions, interest or assessment related thereto. “Tax Benefits” means the PTC, ITC, and any other state, local and/or federal tax benefit or incentive, including energy credits determined under Sections 38, 45, 45Y, 46, 48 and 48E of the Internal Revenue Code of 1986, as amended, investment tax credits, production tax credits, depreciation, amortization, deduction, expense, exemption, preferential rate, and/or other tax benefit or incentive associated with the production, sale, or storage of renewable energy and/or the operation, construction, investments in or ownership of, the Facility (including any cash payment or grant).
“Terminated Transaction” has the meaning set forth in Section 11.2(a). “Termination Payment” has the meaning set forth in Section 11.3. “Test Energy” means Facility Energy delivered (a) commencing on the later of (i) the first date that the CAISO informs Seller in writing that Seller may deliver Energy to the CAISO and (ii) the first date that the PTO informs Seller in writing that Seller has conditional or temporary permission to parallel and (b) ending upon the occurrence of the Commercial Operation Date. “Test Energy Rate” has the meaning set forth in Section 3.6. “Third Phase Agreement” means the agreement between Buyer and the Participating Members that sets forth the terms and conditions under which Buyer is authorized to enter into this Agreement on behalf of the Participating Members.
“TP Deliverability” has the meaning set forth in the CAISO Tariff. “Transmission Provider” means any entity or entities transmitting or transporting the Facility Energy on behalf of Buyer from the Delivery Point. “Transmission System” means the transmission facilities operated by the CAISO, now or hereafter in existence, which provide energy transmission service downstream from the Delivery Point.
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23 “UFLPA/WRO Restraint” means any withhold release order or other import restraint issued by U.S. Customs and Border Protection or other applicable Governmental Authority, including under the Uyghur Forced Labor Prevention Act, that prevents or delays the import or release of any PV Equipment into the United States and such order, despite the use by Seller of commercially reasonable efforts to avoid procurement or sourcing of PV Equipment that was reasonably foreseeable to become subject to such restraint, prevents or delays the delivery of such PV Equipment to Seller for incorporation into the Facility. “Ultimate Parent” means NextEra Energy, Inc., NEER, NEP, NEOP, or NEECH, and includes any combination thereof.
“Variable Energy Resource” or “VER” has the meaning set forth in the CAISO Tariff. “WREGIS” means the Western Renewable Energy Generation Information System or any successor renewable energy tracking program.
“WREGIS Certificate Deficit” has the meaning set forth in Section 4.7(e). “WREGIS Certificates” has the same meaning as “Certificate” as defined by WREGIS in the WREGIS Operating Rules and are designated as eligible for complying with the California Renewables Portfolio Standard.
“WREGIS Operating Rules” means those operating rules and requirements adopted by WREGIS as of October 1, 2022, as subsequently amended, supplemented or replaced (in whole or in part) from time to time.

1.2 Rules of Interpretation. In this Agreement, except as expressly stated otherwise or unless the context otherwise requires:
(a) headings and the rendering of text in bold and italics are for convenience and reference purposes only and do not affect the meaning or interpretation of this Agreement; (b) words importing the singular include the plural and vice versa and the masculine, feminine and neuter genders include all genders; (c) the words “hereof”, “herein”, and “hereunder” and words of similar import shall refer to this Agreement as a whole and not to any particular provision of this Agreement; (d) a reference to an Article, Section, paragraph, clause, Party, or Exhibit is a reference to that Article, Section, paragraph, clause of, or that Party or Exhibit to, this Agreement unless otherwise specified;
(e) a reference to a document or agreement, including this Agreement means such document, agreement or this Agreement including any amendment or supplement to, or replacement, novation or modification of this Agreement, but disregarding any amendment, supplement, replacement, novation or modification made in breach of such document, agreement or this Agreement;
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24 (f) a reference to a Person includes that Person’s successors and permitted assigns;
(g) the terms “include” and “including” mean “include or including (as applicable) without limitation” and any list of examples following such terms shall in no way restrict or limit the generality of the word or provision in respect of which such examples are provided;
(h) references to any statute, code or statutory provision are to be construed as a reference to the same as it may have been, or may from time to time be, amended, modified or reenacted, and include references to all bylaws, instruments, orders and regulations for the time being made thereunder or deriving validity therefrom unless the context otherwise requires; (i) in the event of a conflict, a mathematical formula or other precise description of a concept or a term shall prevail over words providing a more general description of a concept or a term;
(j) references to any amount of money shall mean a reference to the amount in United States Dollars;
(k) the expression “and/or” when used as a conjunction shall connote “any or all of”;
(l) words, phrases or expressions not otherwise defined herein that (i) have a generally accepted meaning in Prudent Operating Practice shall have such meaning in this Agreement or (ii) do not have well known and generally accepted meaning in Prudent Operating Practice but that have well known and generally accepted technical or trade meanings, shall have such recognized meanings; and
(m) each Party acknowledges that it was represented by counsel in connection with this Agreement and that it or its counsel reviewed this Agreement and that any rule of construction to the effect that ambiguities are to be resolved against the drafting Party shall not be employed in the interpretation of this Agreement.

ARTICLE 2
TERM; CONDITIONS PRECEDENT

2.1 Contract Term.
(a) The term of this Agreement shall commence on the Effective Date and shall remain in full force and effect until the conclusion of the Delivery Term, subject to any early termination provisions set forth herein (“Contract Term”); provided, however, that subject to Buyer’s obligations in Section 3.6, Buyer’s obligations to pay for or accept any Product are subject to Seller’s completion of the conditions precedent pursuant to Section 2.2. (b) Applicable provisions of this Agreement shall continue in effect after termination, including early termination, to the extent necessary to enforce or complete the duties, obligations or responsibilities of the Parties arising prior to termination. The indemnity and audit 150
25 rights shall remain in full force and effect for one (1) year following the termination of this Agreement. The confidentiality obligations of the Parties under Article 18 shall remain in full force and effect for two (2) years following the termination of this Agreement.

2.2 Conditions Precedent. The Delivery Term shall commence upon Seller’s completion of all of the following conditions:
(a) Seller shall have constructed or caused to be constructed the Facility as of the Commercial Operation Date to (i) enable Seller to satisfy the obligations of the Seller under this Agreement subject to Exhibit B, Section 5, and (ii) enable the Facility to provide Product; (b) The Facility has successfully completed all testing required by Prudent Operating Practice or any requirement of Law to operate the Facility; (c) Seller has delivered to Buyer (i) a completion certificate from a Licensed Professional Engineer substantially in the form of Exhibit H and (ii) a certificate from a Licensed Professional Engineer substantially in the form of Exhibit I setting forth the Installed Capacity on the Commercial Operation Date;
(d) A Participating Generator Agreement and a Meter Service Agreement for Metered Entities between Seller and CAISO shall have been executed and delivered and be in full force and effect, and a copy of each such agreement delivered to Buyer; (e) An Interconnection Agreement between Seller or Seller’s Affiliate and the PTO shall have been executed and delivered and be in full force and effect and a copy of the Interconnection Agreement delivered to Buyer;
(f) All applicable regulatory authorizations, approvals and permits required for the operation of the Facility have been obtained and all required conditions thereof that are required to be satisfied by the Commercial Operation Date have been satisfied and shall be in full force and effect (including CEQA requirements);
(g) Seller has provided notice that Seller (either itself or through the engagement of an Affiliate) will act as the Qualified Operator for the Facility, or Seller has entered into one or more agreements providing for the operation and maintenance of the Facility with one or more other Qualified Operators;
(h) Seller, with the reasonable cooperation of Buyer, has taken all actions and executed and delivered to Buyer and the CAISO all documents that are reasonably capable of being completed prior to the Commercial Operation Date necessary to register and quality the Facility to participate and operate in the CAISO markets, as set forth in the CAISO Tariff, including satisfying and completing the CAISO New Resource Implementation process (commonly referred to as the “NRI Process”) with respect to the Facility;
(i) Seller has received CEC Precertification of the Facility (and reasonably expects to receive final CEC Certification and Verification for the Facility in no more than one hundred eighty (180) days from the Commercial Operation Date); 151
26 (j) Seller (with the reasonable participation of Buyer) shall have completed all applicable WREGIS registration requirements that are reasonably capable of being completed prior to the Commercial Operation Date under WREGIS rules, including (as applicable) the completion and submittal of all applicable registration forms and supporting documentation, which may include applicable interconnection agreements, informational surveys related to the Facility, and other appropriate documentation required to effect Facility registration with WREGIS and to enable PCC1 Renewable Energy Credit transfers related to the Facility within the WREGIS system; and
(k) Seller has delivered the Performance Security to Buyer in accordance with Section 8.8.
(l) Seller has satisfied the insurance requirements to the extent set forth in Section 17.1(a) of this Agreement.
(m) Seller or its Affiliate has obtained Site Control necessary to enable Seller to satisfy the obligations of the Seller under this Agreement.

2.3 Development; Construction; Progress Reports. Within fifteen (15) days after the close of (i) each calendar quarter from the first calendar quarter following the Effective Date until the Construction Start Date, and (ii) each calendar month from the first calendar month following the Construction Start Date until the Commercial Operation Date, Seller shall provide to Buyer a Progress Report and shall hold regularly scheduled (i.e., quarterly or monthly, as applicable) meetings between representatives of Buyer and Seller to review such reports and discuss Seller’s construction progress, such meeting to be held in person or by teleconference as agreed between the Parties. The form of the Progress Report is set forth in Exhibit E. Seller shall also provide Buyer with any reasonable requested documentation (subject to confidentiality restrictions) directly related to the achievement of Milestones within ten (10) Business Days of receipt of such request by Seller. For the avoidance of doubt, as between Seller and Buyer, Seller is solely responsible for the design and construction of the Facility, including the location of the Site, obtaining all permits and approvals to build the Facility, the Facility layout, and the selection and procurement of the equipment comprising the Facility.

2.4 Remedial Action Plan. If Seller (a) misses the Guaranteed Construction Start Date, (b) misses three (3) or more Milestones, or (c) misses any one (1) Milestone (other than the Guaranteed Construction Start Date) by more than ninety (90) days, except as the result of a Development Cure Period, a New PV Trade Measure Event, WRO Restraint, or Buyer Default, Seller shall submit to Buyer, within ten (10) Business Days after the occurrence of (a), (b) or (c), a remedial action plan (“Remedial Action Plan”), which will describe in detail any delays (actual or anticipated) beyond the scheduled Milestone dates, including the cause of the delay, if known (e.g., governmental approvals, financing, property acquisition, design activities, equipment procurement, project construction, interconnection, or any other factor), Seller’s reasonably detailed description of its proposed course of action to achieve the missed Milestones and all subsequent Milestones to the extent possible; provided, delivery of any Remedial Action Plan shall not relieve Seller of its obligation to provide Remedial Action Plans with respect to any subsequent Milestones and to achieve the Guaranteed Commercial Operation Date in accordance with the terms of this Agreement. Subject to the provisions of Exhibit B, so long as Seller complies with 152
27 its obligations under this Section 2.4, Seller shall not be considered in default of its obligations under this Agreement solely as a result of missing any Milestone.

2.5 New PV Trade Measure Events and UFLPA/WRO Restraints.

Notwithstanding anything to the contrary in this Agreement, in connection with any New PV Trade Measure Event or UFLPA/WRO Restraints:
(a) Seller may suspend development and construction of the Facility during, and shall receive a day-for-day extension of the Guaranteed Construction Start Date the Guaranteed Commercial Operation Date, and each other applicable Milestone for, each day of the New PV Trade Measure Event through the end date of such New PV Trade Measure Event or each day of the UFLPA/WRO Restraint through the end date of such UFLPA/WRO Restraint, as applicable, plus any period afterward as is reasonably necessary to accommodate any Seller or industry supply chain mobilization, remobilization, or other adjustment to the outcome of such New PV Trade Measure Event or UFLPA/WRO Restraint, as applicable. Subject to Exhibit B, if the extension of the Guaranteed Commercial Operation Date exceeds 365 days, either Party may within ten (10) Business Days thereof provide a Notice to the other Party terminating this Agreement, provided, however, the Parties may mutually agree to a further extension of time by amending this agreement pursuant to Section 19.2. Neither Party shall have any liability to the other Party as a result of any termination of this Agreement under this Section 2.5(a), and within ten (10) Business Days each Party shall return any Development Security or Buyer Security then held by such Party to Seller or Buyer, as applicable.
(b) Seller may, in its sole discretion at any time prior to sixty (60) days after the occurrence or cessation, as applicable, of such New PV Trade Measure Event, provide written notice to Buyer of a Proposed Contract Price Increase to keep Seller whole with respect to any actual cost increases that Seller incurs as a result of such New PV Trade Measure Event (“Proposed Contract Price Increase”); provided, in which case Seller shall deliver to Buyer a report from an independent retained consultant or other qualified person not employed by or affiliated with Seller or Buyer, and where such independent consultant or other qualified person is approved by Buyer, where such Buyer approval cannot be unreasonably withheld, conditioned or delayed, that explains in reasonable detail (i) the cost impact to Seller and the Facility that result from the applicable New PV Trade Measure Event, and (ii) how the Proposed Contract Price Increase was determined, including an explanation of why the Proposed Contract Price Increase is reasonably necessary to keep Seller whole with respect to the cost increase that Seller expects as a result of the New PV Trade Measure Event (“Independent Report”). Cost impacts shall be shown in the Independent Report in terms of $/WAc to explain changes to the Contract Price. The Independent Report shall be subject to Article 18 of this Agreement and made available only to Buyer’s personnel and representatives who have a need to review the Independent Report in connection with their role for Buyer in implementing this Agreement, and who confirm their agreement to maintain the confidentiality of the Independent Report. Pursuant to the confidentiality requirements of this Agreement, Buyer shall cooperate with Seller to strive to protect the Independent Report from disclosure under the California Public Records Act pursuant to Article 18. If Buyer does not provide written acceptance of the Proposed Contract Price Increase to Seller within sixty (60) days after Buyer’s receipt of the Proposed Contract Price Increase notice from Seller, then Seller may terminate this Agreement upon written notice to Buyer; provided, if such termination Notice is not provided by Seller within ten (10) Business Days after the sixty (60) 153
28 day period has ended, such termination right under this paragraph is forfeited and the terms and conditions of this Agreement will remain unchanged, including the Contract Price. Neither Party shall have any liability to the other Party as a result of any termination of this Agreement under this Section 2.5(b), and within ten (10) Business Days each Party shall return any Development Security or Buyer Security then held by such Party to Seller or Buyer, as applicable.

2.6 Seller’s Pre-COD Termination Right. Notwithstanding anything to the contrary in this Agreement, and without limiting Seller’s rights to terminate for other reasons set forth in this the Agreement, Seller shall have the right to terminate this Agreement for convenience at any time prior to the Commercial Operation Date in exchange for payment of the Damage Payment to Buyer. Seller’s exercise of such termination right shall require that Seller provide at least ten (10) Business Days’ Notice of such termination signed by a duly-authorized officer of Seller which specifically provides that Seller is exercising its right to terminate this Agreement and specifically provides that such termination is being made pursuant to this Section 2.6 of the Agreement.

2.7 CEQA.
(a) The Parties agree that pursuant to Section 2.2(f), Buyer has no obligation to accept or pay for any Product or Test Energy under this Agreement until the date on which all of the following have occurred (such date, the “CEQA Completion Date”): (a) any applicable review under CEQA has been completed by the Lead Agency and all necessary CEQA approval(s) (the “CEQA Approval(s)”) for the Facility have been issued by the Lead Agency; and (b) (i) the applicable period for any judicial challenges to the CEQA Approval(s) relating to the Facility has expired without any such challenge having been filed in court, or (ii) in the event of any such challenge, the challenge has been dismissed, or (iii) in the event of any such challenge, there is not pending any motion for preliminary injunction or stay pending appeal and such CEQA Approval(s) by the Lead Agency have not been enjoined or stayed by a court having competent jurisdiction over such CEQA Approval(s). The Delivery Term shall not occur without the occurrence of the CEQA Completion Date.
(b) Buyer reserves the right to participate in the CEQA review of the Facility by the Lead Agency.

ARTICLE 3

PURCHASE AND SALE

3.1 Purchase and Sale of Product. Subject to the terms and conditions of this Agreement, during the Delivery Term, Buyer will purchase and receive all of the Product produced by or associated with the Facility at the Contract Price and in accordance with Exhibit C, and Seller shall supply and deliver to Buyer all of the Product produced by or associated with the Facility.

At its sole discretion, Buyer may during the Delivery Term re-sell or use for another purpose all or a portion of the Product, provided that no such re-sale or use shall relieve Buyer of any obligations hereunder. During the Delivery Term, Buyer will have exclusive rights to offer, bid, or otherwise submit the Product, or any component thereof, from the Facility after the Delivery Point for resale into the market or to any third party, and retain and receive any and all related revenues.
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29 3.2 Sale of Green Attributes. During the Delivery Term, Seller shall sell and deliver to Buyer, and Buyer shall purchase and receive from Seller, all Green Attributes attributable to the Facility Energy generated by the Facility.

3.3 Imbalance Energy. Buyer and Seller recognize that in any given Settlement Period there may be Imbalance Energy. Except as otherwise set forth in Exhibit D-1, to the extent there is any Imbalance Energy, any amounts payable or receivable related to such Imbalance Energy shall be for the account of Buyer.

3.4 Ownership of Renewable Energy Incentives. Seller shall have all right, title and interest in and to all Renewable Energy Incentives. Buyer acknowledges that any Renewable Energy Incentives belong to Seller. If any Renewable Energy Incentives, or values representing the same, are initially credited or paid to Buyer, Buyer shall cause such Renewable Energy Incentives or values relating to same to be assigned or transferred to Seller without delay. Buyer shall reasonably cooperate with Seller, at Seller’s sole expense, in Seller’s efforts to meet the requirements for any certification, registration, or reporting program relating to Renewable Energy Incentives.

3.5 Future Environmental Attributes.
(a) The Parties acknowledge and agree that as of the Effective Date, environmental attributes sold under this Agreement are restricted to Green Attributes; however, if, after the Effective Date the Facility is able to provide Future Environmental Attributes for any reason, including due to a change in market conditions or Law, Buyer shall have the exclusive right to such Future Environmental Attributes and there shall be no increase in the Contract Price; provided, however, that such right shall be subject to this Section 3.5(a) and Section 3.5(b) and Buyer shall bear all costs and risks associated with the transfer, qualification, verification, registration and ongoing compliance for such Future Environmental Attributes. Upon Seller’s receipt of Notice from Buyer of Buyer’s intent to claim such Future Environmental Attributes, the Parties shall determine the necessary actions and additional costs associated with such Future Environmental Attributes. Seller shall have no obligation to bear any costs, losses or liability, or alter the Facility or the operation of the Facility, unless the Parties have agreed on all necessary terms and conditions relating to such alteration or change in operation and Buyer has agreed to reimburse Seller for all costs, losses, and liabilities associated with such alteration or change in operation.
(b) If Buyer elects to receive Future Environmental Attributes pursuant to, and subject to the requirements of, Section 3.5(a), Seller agrees to work with Buyer in good faith to provide reasonably requested documentation and execute reasonable documentation necessary to effectuate the transfer and registration of such Future Environmental Attributes, including agreement with respect to (i) appropriate transfer, delivery and risk of loss mechanisms, and (ii) appropriate allocation of any additional costs to Buyer, as set forth above (in any event subject to Section 3.9); provided, that the Parties acknowledge and agree such terms shall not alter the other material terms of this Agreement.

3.6 Test Energy. No less than fourteen (14) days prior to the first day on which Test Energy is expected to be available from the Facility, Seller shall notify Buyer of the availability of 155
30 the Test Energy. If and to the extent the Facility generates Test Energy, Seller shall sell and Buyer shall purchase from Seller all Test Energy and any associated Products on an as-available basis.

As compensation for such Test Energy and associated Product, the payment by Buyer to Seller shall be in the amount of seventy percent (70%) of the Contract Price (the “Test Energy Rate”).

For the avoidance of doubt, the conditions precedent in Section 2.2 are not applicable to the Parties’ obligations under this Section 3.6.

3.7 CEC Certification and Verification. Subject to Section 3.9, Seller shall take all necessary steps including, but not limited to, making or supporting timely filings with the CEC to obtain and maintain CEC Certification and Verification for the Facility throughout the Delivery Term, including compliance with all applicable requirements for certified facilities set forth in the current version of the RPS Eligibility Guidebook (or its successor). Seller shall obtain CEC Precertification by the Commercial Operation Date. Within thirty (30) days after the Commercial Operation Date, Seller shall apply with the CEC for final CEC Certification and Verification.

Within one hundred eighty (180) days after the Commercial Operation Date, Seller shall, subject to Section 3.9 or CEC error or omission, obtain and maintain throughout the remainder of the Delivery Term the final CEC Certification and Verification. Seller must promptly notify Buyer and the CEC of any changes to the information included in Seller’s application for CEC Certification and Verification for the Facility.

3.8 RPS Standard Terms and Conditions.
(a) Tracking of RECs in WREGIS. Seller warrants that all necessary steps to allow the Renewable Energy Credits transferred to Buyer to be tracked in the Western Renewable Energy Generation Information System will be taken prior to the first delivery under the contract. [STC REC-2].
(b) Transfer of Renewable Energy Credits. Seller and, if applicable, its successors, represents and warrants that throughout the Delivery Term of this Agreement the Renewable Energy Credits transferred to Buyer conform to the definition and attributes required for compliance with the California Renewables Portfolio Standard, as set forth in California Public Utilities Commission Decision 08-08-028, and as may be modified by subsequent decision of the California Public Utilities Commission or by subsequent legislation. To the extent a change in law occurs after execution of this Agreement that causes this representation and warranty to be materially false or misleading, it shall not be an Event of Default if Seller has used commercially reasonable efforts to comply with such change in law. [STC REC-1]. (c) Eligibility. Seller, and, if applicable, its successors, represents and warrants that throughout the Delivery Term of this Agreement that: (i) the Project qualifies and is certified by the CEC as an Eligible Renewable Energy Resource (“ERR”) as such term is defined in Public Utilities Code Section 399.12 or Section 399.16; and (ii) the Project’s output delivered to Buyer qualifies under the requirements of the California Renewables Portfolio Standard. To the extent a change in law occurs after execution of this Agreement that causes this representation and warranty to be materially false or misleading, it shall not be an Event of Default if Seller has used commercially reasonable efforts to comply with such change in law. [STC 6]. 156
31 (d) With respect to the immediately preceding paragraphs (a) – (c), (i) the reference in Section 3.8(a) to “first delivery under the contract” has the same meaning as “first delivery of Facility Energy under this Agreement”, (ii) the references in Section 3.8(c) to “Project” have the same meaning as “Facility”, (iii) the reference in Section 3.8(c)(ii) to “the Project’s output” has the same meaning as “the Facility Energy”, (iv) “qualifies and is certified by the CEC” includes for up to six (6) months after COD CEC pre-certification of the Facility, (v) each reference in the last sentences of Section 3.8(b) and Section 3.8(c) to “commercially reasonable efforts” means efforts consistent with and subject to Section 3.9 below, and (vi) the references in Section 3.8(a) and Section 3.8(b) to “Renewable Energy Credits” means “PCC1 Renewable Energy Credits”.

3.9 Compliance Expenditure Cap.
(a) If a Change in Law occurring after the Effective Date has increased Seller’s known or reasonable expected costs to comply with Seller’s obligations to cause the Green Attributes to be compliant with the California RPS Program and Section 399.16(b)(1) of the California Public Utilities Code, then the Parties agree that the maximum aggregate amount of outof-pocket costs and expenses (“Compliance Costs”) that Seller shall be required to bear during the Contract Term to comply with all of such obligations shall be capped at Thirty Thousand Dollars ($30,000) per MWAC of Guaranteed Capacity (“Compliance Expenditure Cap”). Seller’s internal administrative costs association with obtaining, maintaining, conveying or effectuating, Buyer’s use of (as applicable) any Product are excluded from the Compliance Expenditure Cap. (b) Any actions required for Seller to comply with its obligations set forth in the first paragraph above, the Compliance Costs of which will be included in the Compliance Expenditure Cap, shall be referred to collectively as the “Compliance Actions.” (c) If Seller reasonably anticipates the need to incur Compliance Costs in excess of the Compliance Expenditure Cap in order to take any Compliance Action Seller shall provide Notice to Buyer of such anticipated Compliance Costs. 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 Compliance 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.
(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 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. (e) If Buyer does not respond to a Notice given by Seller under this Section 3.9 within sixty (60) days, or if Buyer does not timely pay the costs and expenses in excess of the Accepted Compliance Costs, 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 157
32 obligation to take, and no liability or obligation under this Agreement for any failure to take, such Compliance Actions.
(f) If a Change in Law makes it infeasible for Seller to comply with its obligations under this Section 3.9, and it is not possible to overcome the Change in Law through Compliance Actions or the expenditure of money, then, except as otherwise provided or contemplated in this Agreement with respect to how a Change in Law will be addressed, then in each case (i) Seller shall be excused from the corresponding Compliance Actions under this Agreement, and (ii) Buyer shall continue to pay Seller under this Agreement without any reduction in revenues that otherwise would result from the Change in Law.

3.10 Project Configuration. In order to optimize the benefits of the Facility, Buyer and Seller each agree that if requested by the other Party, then Buyer and Seller will discuss in good faith potential reconfiguration of the Facility or Interconnection Facilities; provided, neither Party shall be obligated to agree to any changes under this Agreement, or to incur any expense in connection with such changes, except under terms mutually acceptable to both Parties (and Seller’s Lenders) as set forth in a written agreement executed by the Parties. For the avoidance of doubt, and notwithstanding anything in this Agreement to the contrary: (a) as of the Effective Date, the Facility has Energy-Only Deliverability Status; and (b) Seller makes no representation or warranty that the Facility will obtain deliverability or any allocation of TP Deliverability, or achieve Full Capacity Deliverability Status or Interim Deliverability Status.

ARTICLE 4

OBLIGATIONS AND DELIVERIES

4.1 Delivery.
(a) Energy. Subject to the provisions of this Agreement, commencing on the Commercial Operation Date and through the end of the Contract Term, Seller shall supply and deliver the Product to Buyer at the Delivery Point, and Buyer shall take delivery of the Product at the Delivery Point in accordance with the terms of this Agreement. Seller shall be responsible for paying or satisfying when due any costs or charges imposed in connection with the delivery of Facility Energy to the Delivery Point, including without limitation, Station Use, Electrical Losses, and any operation and maintenance charges imposed on Seller by the Transmission Provider directly relating to the Facility’s operations. Buyer shall be responsible for all costs, charges and penalties, if any, imposed in connection with the delivery of Facility Energy at and after the Delivery Point, including without limitation transmission costs and transmission line losses and imbalance charges. The Facility Energy will be Scheduled with the CAISO by Buyer (or Buyer’s designated Scheduling Coordinator for the Facility) in accordance with the CAISO Tariff, and the Scheduling and operating procedures developed under Exhibit D-2. (b) Green Attributes. All Green Attributes associated with the Facility Energy during the Delivery Term are exclusively dedicated to and will be conveyed to Buyer. Seller represents and warrants that Seller holds the rights to all Green Attributes from the Facility Energy, and Seller agrees to convey and hereby conveys all such Green Attributes to Buyer as included in the delivery of the Product from the Facility.
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33 (c) Scheduling Coordination. The Parties agree to coordinate with respect to the dispatch of Energy from the Facility on a periodic basis. The Parties further agree to update Sections 4.3 to 4.4 or Exhibit D-2 as needed by mutual written agreement.

4.2 Title and Risk of Loss.
(a) Energy. Title to and risk of loss related to the Facility Energy, shall pass and transfer from Seller to Buyer at the Delivery Point. Seller warrants that all Product delivered to Buyer is free and clear of all liens, security interests, claims and encumbrances of any kind. (b) Green Attributes. Title to and risk of loss related to the Green Attributes associated with the Facility Energy shall pass and transfer from Seller to Buyer upon the transfer of such Green Attributes in accordance with WREGIS Operating Rules, or other applicable rules and requirements in the event WREGIS is no longer used to transfer Green Attributes.

4.3 Forecasting. Seller shall provide or cause to be provided the forecasts described below at its sole expense and in a format reasonably acceptable to Buyer (or Buyer’s designee).

Seller shall use reasonable efforts to provide forecasts that are accurate and, to the extent not inconsistent with the requirements of this Agreement, shall prepare such forecasts, or cause such forecasts to be prepared, in accordance with Prudent Operating Practices; provided, however, the Parties acknowledge that the Real-Time Forecast is provided by an Approved Forecast Vendor which, at least as of the Effective Date, is not Seller but the CAISO and Seller undertakes no obligations with respect to the accuracy of such CAISO forecasts. (a) Annual Forecast of Energy. No less than thirty (30) days before (i) the first day of the first Contract Year of the Delivery Term and (ii) at the beginning of each calendar year for every subsequent Contract Year during the Delivery Term, Seller shall provide to Buyer and the SC (if applicable) a non-binding forecast of each month’s average-day expected Energy, by hour, for the following calendar year in a form substantially similar to the table found in Exhibit F1, or as reasonably requested by Buyer. (b) Monthly Forecast of Energy and Available Generating Capacity. No less than thirty (30) days before the beginning of Commercial Operation, and thereafter at least ten (10) Business Days before the beginning of each month during the Delivery Term, Seller shall provide to Buyer and the SC (if applicable) a non-binding forecast of the hourly expected Energy and expected Available Generating Capacity for each day of the following month in a form substantially similar to the table found in Exhibit F-2, or as reasonably agreed to by the Parties (“Monthly Delivery Forecast”).
(c) Day-Ahead Forecast. By 5:30 AM Pacific Prevailing Time on the Business Day immediately preceding the date of delivery, or as otherwise specified by Buyer consistent with Prudent Operating Practice, Seller shall provide Buyer with a non-binding forecast of Available Generating Capacity, and an Approved Forecast Vendor shall provide Buyer with a nonbinding forecast of hourly expected Energy for each Settlement Interval of each hour of the immediately succeeding day (“Day-Ahead Forecast”). A Day-Ahead Forecast provided in a day prior to any non-Business Day(s) shall include non-binding forecasts for the immediate day, each succeeding non-Business Day and the next Business Day. Each Day-Ahead Forecast shall clearly 159
34 identify, for each Settlement Interval of each hour, Seller’s best estimate of the Available Generating Capacity, and the Approved Forecast Vendor’s best estimate of the hourly expected Energy. These Day-Ahead Forecasts shall be sent to Buyer. If Seller or an Approved Forecast Vendor fails to provide Buyer with a Day-Ahead Forecast as required herein for any period, then for such unscheduled delivery period only Buyer shall rely on any Real-Time Forecast provided in accordance with Section 4.3(d) or the Monthly Delivery Forecast or Buyer’s best estimate based on information reasonably available to Buyer.
(d) Real-Time Forecasts. During the Delivery Term, Seller shall notify Buyer of any changes from the Day-Ahead Forecast of Available Generating Capacity of one (1) MW or more, and an Approved Forecast Vendor shall provide Buyer with an updated hourly expected Energy forecast for each Settlement Interval of each hour of the current operating day. The updated forecast of Available Generating Capacity and the hourly expected Energy shall be provided to Buyer as soon as reasonably possible, but no later than one (1) hour prior to the deadline for submitting Schedules to the CAISO in accordance with the rules for participation in the Real-Time Market (“Real-Time Forecast”). Such Real-Time Forecasts of Energy shall be provided by an Approved Forecast Vendor each hour and shall contain information regarding the beginning date and time of the event resulting in the change in Available Generating Capacity or the total amount of hourly expected Energy, as applicable, the expected end date and time of such event, and any other information required by the CAISO or reasonably requested by Buyer. With respect to any Forced Facility Outage, Seller shall use commercially reasonable efforts to notify Buyer of such outage within ten (10) minutes of the commencement of the Forced Facility Outage.

Seller shall inform Buyer of any developments that will affect either the duration of such outage or the availability of the Facility during or after the end of such outage. These Real-Time Forecasts shall be communicated in a method reasonably acceptable to Buyer; provided that Buyer specifies the method no later than fifteen (15) Business Days prior to the effective date of such requirement.

In the event Buyer fails to provide Notice of an acceptable method for communications under this Section 4.3(d), then Seller shall send such communications by telephone and e-mail to Buyer. (e) Forced Facility Outages. Notwithstanding anything to the contrary herein, Seller shall promptly notify Buyer of Forced Facility Outages and Seller shall keep Buyer informed of any developments that will affect either the duration of the outage or the availability of the Facility during or after the end of the outage.
(f) CAISO Tariff Requirements. To the extent such obligations are applicable to the Facility, Seller will comply with all applicable obligations for Variable Energy Resources under the CAISO Tariff and the Eligible Intermittent Resource Protocol, including providing appropriate operational data and meteorological data, and will fully cooperate with Buyer and CAISO, in providing all data, information, and authorizations required thereunder.

4.4 Dispatch Down/Curtailment.
(a) General. Seller agrees to reduce the amount of Facility Energy produced by the Facility, by the amount and for the period set forth in any Curtailment Order, Buyer Curtailment Order, or notice received from CAISO in respect of a Buyer Bid Curtailment. (b) Buyer Curtailment. Buyer shall have the right to order Seller to curtail 160
35 deliveries of Facility Energy through Buyer Curtailment Orders and/or Buyer Bid Curtailments; provided, Buyer shall pay Seller for all Deemed Delivered Energy associated with any Buyer Curtailment Period as set forth in Section (b) of Exhibit C. (c) Failure to Comply. If Seller fails to comply with Curtailment Order, Buyer Curtailment Order, or notice received from CAISO in respect of a Buyer Bid Curtailment, then, for each MWh of Facility Energy that is delivered by the Facility to the Delivery Point in contradiction to the Curtailment Order, Buyer Curtailment Order, or notice received from CAISO in respect of a Buyer Bid Curtailment, Seller shall pay Buyer for each such MWh at an amount equal to the sum of (A) + (B) + (C), where: (A) is the amount, if any, paid to Seller by Buyer for delivery of such excess MWh and, (B) is the sum, for all Settlement Intervals with a Negative LMP during the Buyer Curtailment Period or Curtailment Period, of the absolute value of the product of such excess MWh in each Settlement Interval and the Negative LMP for such Settlement Interval, and (C) is any penalties assessed by the CAISO or other charges assessed by the CAISO resulting from Seller’s failure to comply with the Curtailment Order, Buyer Curtailment Order, or notice received from CAISO in respect of a Buyer Bid Curtailment. (d) Seller Equipment Required for Curtailment Instruction Communications.

Seller shall acquire, install, and maintain such facilities, communications links and other equipment, and implement such protocols and practices, as necessary to respond and follow instructions, including an electronic signal conveying real time and intra-day instructions, to operate the Facility as reasonably directed by the Buyer in accordance with this Agreement or a Governmental Authority, including to implement a Buyer Curtailment Order, Buyer Bid Curtailment, or Curtailment Order in accordance with the then-current methodology used to transmit such instructions as it may change from time to time (including adjustments to megawatt output in real-time by means of set points received by the Facility controller of Seller, provided that the dispatch order is consistent with the Facility’s operational characteristics as then-currently modeled in the CAISO Master File). If at any time during the Delivery Term Seller’s facilities, communications links or other equipment, protocols or practices are not in compliance with thencurrent methodologies, Seller shall take the steps necessary to become compliant as soon as reasonably possible. Seller shall be liable pursuant to Section 4.4(c) for failure to comply with a Buyer Curtailment Order, Buyer Bid Curtailment, or Curtailment Order, during the time that Seller’s facilities, communications links or other equipment, protocols or practices are not in compliance with then-current methodologies. For the avoidance of doubt, a Buyer Curtailment Order, Buyer Bid Curtailment, or Curtailment Order communication via such systems and facilities shall have the same force and effect on Seller as any other form of communication.

4.5 Reduction in Delivery Obligation. For the avoidance of doubt, and in no way limiting Section 3.1 or Exhibit G:
(a) Facility Maintenance. In developing the Operating Coordination Scheduling and operating procedures set forth in Exhibit D-2, the Parties will work together on a mutually acceptable template to document how maintenance and outages will impact the availability of the Facility to be bid and Scheduled in the CAISO market. Subject to providing Buyer at least sixty (60) days’ prior Notice, Seller shall be permitted to reduce deliveries of Product during any period of scheduled maintenance on the Facility, provided, that (i) Seller may adjust the dates of any scheduled maintenance with fewer than sixty (60) days’ prior Notice to Buyer so 161
36 long as (X) Seller makes its request more than ten (10) days prior to the expected start date of such scheduled maintenance and (Y) the requested alternate date is acceptable to Buyer in its reasonable discretion not to be unreasonably withheld, conditioned or delayed. All scheduled maintenance and outages requested by Seller shall comply with the requirements of the CAISO Tariff. To the extent notice is not already required under the terms hereof, Seller shall notify Buyer as soon as practicable of any extensions to scheduled maintenance and expected end dates thereof. Between June 1st and September 30th, Seller shall not schedule non-emergency maintenance that reduces the energy generation of the Facility by more than ten percent (10%), unless (i) such outage is required to avoid an emergency or damage to the Facility, (ii) such maintenance is necessary to maintain equipment warranties and cannot be scheduled outside the period of June 1st to September 30th, (iii) such outage is required in accordance with Prudent Operating Practices, (iv) such outage is in connection with Force Majeure events, (v) such outage is required by Law, the requirements of CAISO or the interconnecting utility, and/or other applicable Governmental Authority, or (vi) the Parties agree otherwise in writing (each scheduled maintenance permitted under this clause (a) and each of the foregoing outages described in foregoing clauses (a)(i) – (a)(vi), a “Planned Outage”).
(b) Forced Facility Outage. Seller shall be permitted to reduce deliveries of Product during any Forced Facility Outage. Seller shall provide Buyer with Notice and expected duration (if known) of any Forced Facility Outage in accordance with the requirements of the CAISO Tariff.
(c) System Emergencies and other Interconnection Events. Seller shall be permitted to reduce deliveries of Product during any period of System Emergency, Buyer Curtailment Period or upon Notice of a Curtailment Order pursuant to the terms of this Agreement, the Interconnection Agreement or applicable tariff.
(d) Force Majeure Event. Seller shall be permitted to reduce deliveries of Product during any Force Majeure Event.
(e) Health and Safety. Seller shall be permitted to reduce deliveries of Product as necessary to maintain health and safety pursuant to Section 6.2.

4.6 Guaranteed Energy Production. Seller shall be required to deliver to Buyer no less than the Guaranteed Energy Production in each Performance Measurement Period. For purposes of determining whether Seller has achieved the Guaranteed Energy Production, in addition to the Facility Energy delivered during the relevant Performance Measurement Period, Seller shall be deemed to have delivered to Buyer (1) any Deemed Delivered Energy during such Performance Measurement Period, (2) Energy in the amount it could reasonably have delivered to Buyer during such Performance Measurement Period but was prevented from delivering to Buyer by reason of any Force Majeure Events, System Emergency, and Curtailment Periods (“Lost Output”). Lost Output shall be measured in the same manner as Deemed Delivered Energy. If Seller fails to achieve the Guaranteed Energy Production amount in any Performance Measurement Period (as determined in Exhibit G), Seller shall pay Buyer damages calculated in accordance with Exhibit G, which, except as set forth in Section 11.1(b)(iii), shall be Buyer’s sole and exclusive remedy in connection with Seller’s failure to meet the achieve the Guaranteed Energy Production amount.
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37 4.7 WREGIS. Seller shall, at its sole expense, but subject to Section 3.9, take all actions and execute all documents or instruments necessary to ensure that all WREGIS Certificates associated with all PCC1 Renewable Energy Credits corresponding to all Facility Energy (net of any losses if required by Law) are issued and tracked for purposes of satisfying the requirements of the California Renewables Portfolio Standard and transferred in a timely manner to Buyer for Buyer’s sole benefit. Seller shall transfer the PCC1 Renewable Energy Credits to Buyer. Seller shall comply with all Laws, including the WREGIS Operating Rules, regarding the certification and transfer of such WREGIS Certificates to Buyer and Buyer shall be given sole title to all such WREGIS Certificates. In addition:
(a) Seller shall ensure all applicable steps have been taken to register the Facility with WREGIS that are reasonably capable of being completed prior to the Commercial Operation Date under WREGIS rules, and, within the administrative timeframe set forth in the WREGIS Operating Rules, but no longer than ninety (90) days after Commercial Operation, Seller shall ensure the Facility is registered with active status in WREGIS and is associated with an active account in WREGIS (“Seller’s WREGIS Account”), which Seller shall maintain until the end of the Delivery Term. Seller shall transfer the WREGIS Certificates using “Recurring Certificate Transfers” (as described in the WREGIS Operating Rules) from Seller’s WREGIS Account to the WREGIS account(s) of Buyer or the account(s) of a designee that Buyer identifies by Notice to Seller (“Buyer’s WREGIS Account”). Seller shall be responsible for all expenses associated with registering the Facility with WREGIS, establishing and maintaining Seller’s WREGIS Account, paying WREGIS Certificate issuance and transfer fees, transferring WREGIS Certificates from Seller’s WREGIS Account to Buyer’s WREGIS Account, and acquiring and arranging for a Qualified Reporting Entity for the Facility and any applicable QRE agreements.

Buyer shall be responsible for establishing and maintaining Buyer’s WREGIS Account. (b) Seller shall cause Recurring Certificate Transfers to occur on a monthly basis in accordance with the WREGIS Operating Rules. Since WREGIS Certificates will only be created for whole MWh amounts of Facility Energy generated (net of any losses if required by Law), any fractional MWh amounts (i.e., kWh) will be carried forward until sufficient generation is accumulated for the creation of a WREGIS Certificate. (c) Seller shall, at its sole expense, ensure that the WREGIS Certificates for a given calendar month correspond with the Facility Energy for such calendar month as evidenced by the Facility’s metered data (net of any losses if required by Law). (d) Due to the administrative delay in the creation of WREGIS Certificates, as further set forth in the WREGIS Operating Rules, relative to the timing of invoice payment under Section 8.2, Buyer shall make an invoice payment for a given month in accordance with Section

8.2 before the WREGIS Certificates for such month are formally transferred to Buyer in accordance with the WREGIS Operating Rules and this Section 4.7. Notwithstanding this delay, Buyer shall have all right and title to all such WREGIS Certificates upon payment to Seller in accordance with Section 8.2.
(e) A “WREGIS Certificate Deficit” means any deficit or shortfall in WREGIS Certificates delivered to Buyer for a calendar month as compared to the Facility Energy for the same calendar month (“Deficient Month”) caused by an error or omission of Seller. If any 163
38 WREGIS Certificate Deficit is caused, or the result of any action or inaction by Seller, then the amount of Facility Energy (net of any losses if required by Law) in the Deficient Month shall be reduced by the amount of the WREGIS Certificate Deficit for purposes of calculating Buyer’s payment to Seller under Article 8 and the Guaranteed Energy Production for the applicable Contract Year; provided, however, that such adjustment shall not apply to the extent that Seller either (x) resolves the WREGIS Certificate Deficit within one hundred eighty (180) days after the Deficient Month or (y) provides Replacement Green Attributes (as defined in Exhibit G) delivered to CAISO as Scheduled Energy within ninety (90) days after the Deficient Month (i) upon a schedule reasonably acceptable to Buyer and (ii) provided that such deliveries do not impose additional costs upon Buyer for which Seller refuses to provide reimbursement. If a WREGIS Certificate Deficit is caused by an error or omission of WREGIS or the CEC, the Parties shall cooperate in good faith to cause WREGIS or the CEC, as applicable, to correct its error or omission.
(f) Subject to Section 3.9, if WREGIS changes the WREGIS Operating Rules after the Effective Date or applies the WREGIS Operating Rules in a manner inconsistent with this Section 4.7 after the Effective Date, the Parties promptly shall modify this Section 4.7 as reasonably required to cause and enable Seller to transfer to Buyer’s WREGIS Account a quantity of WREGIS Certificates for each given calendar month that corresponds to the Facility Energy in the same calendar month.

4.8 Interconnection Costs. As between Buyer and Seller, Seller is responsible for all costs and charges associated with Interconnection Facilities and Network Upgrades necessitated by the interconnection of the Facility.

ARTICLE 5
TAXES

5.1 Allocation of Taxes and 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 (other than withholding or other Taxes imposed on Buyer’s income, revenue, receipts or employees). 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.

5.2 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, however, that 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. 164
39 ARTICLE 6

OPERATIONS AND MAINTENANCE OF THE FACILITY

6.1 Operation and Maintenance of the Facility.
(a) Seller shall comply with Law and Prudent Operating Practice, and to the extent applicable the CAISO Tariff and the Interconnection Agreement, relating to the operation and maintenance of the Facility and the generation and sale of Product. Seller shall be responsible for maintenance of the Facility, and Buyer shall have no responsibility or liability for the maintenance of the Facility. Seller shall be responsible for the operation of the Facility, and Buyer shall have no responsibility or liability for the operation of the Facility other than with respect to its role as Scheduling Coordinator. Seller will maintain 24-7 remote monitoring of the Facility. This includes advanced alarm management, data analytics, emergency response, scheduling of preventative and corrective maintenance, troubleshooting, remote resets and dispatch of on-site resources.
(b) Seller shall, if applicable, obtain in its own name and at its own expense all pollution or environmental credits or offsets necessary to operate the Facility in compliance with any requirement of Law; provided for the avoidance of doubt, Seller shall not use any Green Attributes to satisfy the foregoing obligations, if any. (c) Without regard to whether or not there is any applicable Law requiring decommissioning or demolition of the Facility or any environmental or other liability associated with the decommissioning or demolition of the Facility, Buyer shall not be responsible for any cost of decommissioning or demolition of the Facility or any environmental or other liability associated with the decommissioning or demolition of the Facility without regard to the timing or cause of the decommissioning or demolition.

6.2 Maintenance of Health and Safety. Seller shall take reasonable safety precautions with respect to the operation, maintenance, repair and replacement of the Facility. If Seller becomes aware of any circumstances relating to the Facility that create an imminent risk of damage or injury to any Person or any Person’s property, Seller shall take prompt, reasonable action to prevent such damage or injury and shall give Notice to Buyer’s emergency contact identified on Exhibit N of such condition. Such action may include, to the extent reasonably necessary, disconnecting and removing all or a portion of the Facility, or suspending the supply of Energy to Buyer.

6.3 Shared Facilities. The Parties acknowledge and agree that certain of the Shared Facilities and Interconnection Facilities, and Seller’s rights and obligations under the Interconnection Agreement, may be subject to certain shared facilities or co-tenancy agreements to be entered into among Seller, the Participating Transmission Owner, Seller’s Affiliates, or other third parties pursuant to which certain Shared Facilities and Interconnection Facilities may be subject to joint ownership and shared maintenance and operation arrangements; provided that such agreements (i) shall permit Seller to perform or satisfy, and shall not purport to limit, its obligations hereunder, including providing the Dedicated Interconnection Capacity for the Facility in an amount not less than (and not greater than) the Guaranteed Capacity for Buyer’s sole use, (ii) provide for separate metering of the Facility, (iii) provide that any other generating or energy 165
40 storage facilities not included in the Facility but using Shared Facilities shall not be included within the Facility’s CAISO Resource ID, and (iv) provide that any curtailment of the Shared Facilities that is ordered by Transmission Provider that Seller and its Affiliates have discretion to allocate across generating or energy storage facilities using the Shared Facilities shall not be allocated to the Facility in an amount that is higher than Buyer’s pro rata portion of the total capacity of all generating or energy storage facilities using the Shared Facilities.

ARTICLE 7

METERING

7.1 Metering.
(a) Seller shall measure the amount of Facility Energy using the Facility Meter, which Facility Meter shall be dedicated exclusively to the Facility. Subject to meeting any applicable CAISO requirements, the Facility Meter shall be programmed to adjust for Electrical Losses and Station Use from the Facility to the Delivery Point in a manner subject to Buyer’s prior written approval, not to be unreasonably withheld. Seller shall arrange and bear all costs associated with the installation of the Facility Meter needed for the registration, recording and transmission of information regarding the Facility Energy. Seller hereby agrees to provide a mutually agreed set of meter data to Buyer in a format to be reasonably agreed to by the Parties. If the CAISO makes any adjustment to any CAISO meter data for a given time period, it will be addressed by the Parties consistent with Section 8.4 of this Agreement. The Facility Meter will be operated pursuant to applicable CAISO-approved calculation methodologies and maintained at Seller’s cost, and in accordance with the requirements of the MSA. The Parties intend as of the Effective Date that the applicable MSA will be a CAISO Metered Entity; provided, however, Seller may decide that the Facility should be a Scheduling Coordinator Metered Entity or the CAISO may require the Facility to be a Scheduling Coordinator Metered Entity, and in either case Seller, with the reasonable cooperation of Buyer, shall be responsible for the retention of a third-party qualified meter data management agent to perform any such required activities and functions on behalf of the Scheduling Coordinator including in connection with the development of a SQMD Plan and the collection, validation and submission of meter data to the CAISO in accordance with the CAISO Tariff. If Seller decides that the Facility should be a Scheduling Coordinator Metered Entity, or if CAISO requires the Facility to be a Scheduling Coordinator Metered Entity, Buyer or Buyer’s agent, in its role as Scheduling Coordinator for the Facility, shall reasonably cooperate with Seller and any meter data management agent retained by Seller to perform functions on behalf of the Scheduling Coordinator to enable Seller or such meter data management agent to submit the SQMD Plan and Facility Settlement Quality Meter Data to the CAISO, including granting Seller or any meter data management agent retained by Seller access to applicable CAISO system for such purpose (e.g., the CAISO Market Results Interface – Settlements or successor system) to comply with applicable Scheduling Coordinator Metered Entity requirements as set forth in the CAISO Tariff. Seller shall obtain and maintain a single CAISO resource ID dedicated exclusively to the Facility. Seller shall not obtain additional CAISO resource IDs for the Facility without the prior written consent of Buyer, which shall not be unreasonably withheld. Metering shall be consistent with the Metering Diagram set forth as Exhibit R. Each meter shall be kept under seal, such seals to be broken only when the meters are to be tested, adjusted, modified or relocated. In the event Seller breaks a seal, Seller shall notify Buyer as soon as practicable. In addition, Seller hereby agrees to provide all Facility Meter data to Buyer in a form reasonably acceptable to Buyer, 166
41 and consents to Buyer obtaining from CAISO the CAISO meter data directly relating to the Facility and all inspection, testing and calibration data and reports. Seller and Buyer, or Buyer’s Scheduling Coordinator, shall cooperate to allow both Parties to retrieve the meter reads from the CAISO Market Results Interface – Settlements (MRI-S) (or its successor) or directly from the CAISO meter(s) at the Facility.
(b) Section 7.1(a) is based on the Parties’ mutual understanding as of the Effective Date that (i) the CAISO requires the configuration of the Facility to include as the sole meter for the Facility, the Facility Meter, and (ii) the CAISO requires the Facility Meter to be programmed for Electrical Losses as set forth in the definition of Electrical Losses in this Agreement. If any of the foregoing mutual understandings in (i) or (ii) between the Parties become incorrect during the Delivery Term, the Parties shall cooperate in good faith to make any amendments and modifications to the Facility and this Agreement as are reasonably necessary to conform this Agreement to the CAISO Tariff and avoid, to the maximum extent practicable, any CAISO charges, costs or penalties that may be imposed on either Party due to non-conformance with the CAISO Tariff, such agreement not to be unreasonably delayed, conditioned or withheld.

7.2 Meter Verification. Annually, if Seller has reason to believe there may be a meter malfunction, or upon Buyer’s reasonable request, Seller shall test the meter. The tests shall be conducted by independent third parties qualified to conduct such tests. Buyer shall be notified at least seven (7) days in advance of such tests and have a right to be present during such tests. If a meter is inaccurate it shall be promptly repaired or replaced.

ARTICLE 8
INVOICING AND PAYMENT; CREDIT

8.1 Invoicing. Seller shall make good faith efforts to deliver an invoice to Buyer for Product within fifteen (15) Business Days after the end of the prior monthly billing period. Each invoice shall reflect (a) records of metered data, including CAISO metering and transaction data sufficient to document and verify the amount of Product delivered by the Facility for any Settlement Period during the preceding month and any other payment amounts under this Agreement, including the amount of Energy produced by the Facility as read by the Facility Meter, the calculation of Facility Energy, Deemed Delivered Energy, and Adjusted Energy Production, the LMP prices at the Delivery Point for each Settlement Period, and the Contract Price applicable to such Product in accordance with Exhibit C; (b) any records, including invoices or settlement data from the CAISO, necessary to verify the accuracy of any amount; and (c) be in a format reasonably specified by Buyer, covering the services provided in the preceding month determined in accordance with the applicable provisions of this Agreement. Buyer shall, and shall cause its Scheduling Coordinator to, provide Seller with all reasonable access (including, in real time, to the maximum extent reasonably possible) to any records, including invoices or settlement data from the CAISO, forecast data and other information, all as may be necessary from time to time for Seller to prepare and verify the accuracy of all invoices; provided, in the event the Facility is Scheduled in a scheduling coordinator portfolio that includes load and assets that are not directly related to the Facility, Buyer may provide such information to Seller in a format that is necessary to protect the confidentiality of settlement and market data that is not directly associated with the Facility.
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42 8.2 Payment. Buyer shall make payment to Seller for Product by wire transfer or ACH payment to the bank account designated by Seller in Exhibit N, which may be updated by Seller by Notice hereunder. Buyer shall pay undisputed invoice amounts within thirty (30) days after receipt of the invoice or the end of the prior monthly billing period, whichever is later. 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 with respect to this Agreement 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 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.

8.3 Books and Records. To facilitate payment and verification, each Party shall maintain all books and records necessary for billing and payments, including copies of all invoices under this Agreement, for a period of at least two (2) years or as otherwise required by Law. Upon ten (10) Business Days’ Notice to the other Party, either Party shall be granted reasonable access to the accounting books and records within the possession or control of the other Party pertaining to all invoices generated pursuant to this Agreement. Seller acknowledges that in accordance with California Government Code Section 8546.7, Seller may be subject to audit by the California State Auditor with regard to Seller’s performance of this Agreement because the compensation under this Agreement exceeds Ten Thousand Dollars ($10,000).

8.4 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 8.5 or an adjustment to an amount previously invoiced or paid is required due to a correction of data by the CAISO; provided, however, that there shall be no adjustments to prior invoices based upon meter inaccuracies except to the extent that such meter adjustments are accepted by CAISO for revenue purposes. 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 8.2, accruing from the date on which the adjusted amount should have been due.

8.5 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 168
43 overpayments shall be returned via adjustments in accordance with Section 8.4. Any dispute with respect to an invoice is waived if the other Party is not notified in accordance with this Section 8.5 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.

8.6 Netting of Payments. The Parties hereby agree that they shall discharge mutual debts and payment obligations due and owing to each other with respect to this Agreement on the 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 or otherwise arising out of this Agreement, including any related damages calculated pursuant to Exhibits B and G, interest, and payments or credits, shall be netted so that only the excess amount remaining due shall be paid by the Party who owes it.

8.7 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. Upon the earlier of (i) Seller’s delivery of the Performance Security, or (ii) sixty (60) days after termination of this Agreement, Buyer shall return the Development Security to Seller, less the amounts drawn (if any) in accordance with this Agreement. If the Development Security is a Letter of Credit and the issuer of such Letter of Credit (i) fails to maintain the minimum Credit Rating specified in the definition of Acceptable Issuer, (ii) indicates its intent not to renew such Letter of Credit and such Letter of Credit expires prior to the Commercial Operation Date, or (iii) fails to honor Buyer’s properly documented request to draw on such Letter of Credit by such issuer, Seller shall have ten (10) Business Days to either post cash or deliver a substitute Letter of Credit in the amount of the Development Security and that otherwise meets the requirements set forth in the definition of Development Security. For avoidance of doubt, and notwithstanding anything to the contrary in this Section 8.7 or elsewhere in this Agreement, Seller shall have no replenishment obligation with respect to the Development Security.

8.8 Seller’s Performance Security. To secure its obligations under this Agreement, Seller shall deliver the Performance Security to Buyer on or before the Commercial Operation Date. If the Performance Security is not in the form of cash or Letter of Credit, it shall be substantially in the form of Guaranty set forth in Exhibit L. Seller shall maintain the Performance Security in full force and effect, subject to any draws made by Buyer in accordance with this Agreement, until the following have occurred: (A) the Delivery Term has expired or terminated early; and (B) all payment obligations of the Seller then 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. If the Performance Security is a Letter of Credit and the issuer of such Letter of Credit (i) fails to maintain the minimum Credit Rating set forth in the definition of Acceptable Issuer, (ii) indicates its intent not to renew such Letter of Credit and such Letter of Credit expires prior to the end of the Delivery Term, or (iii) fails to honor Buyer’s properly documented request to draw on such Letter of Credit by such issuer, Seller shall have ten (10) 169
44 Business Days to either post cash or deliver a substitute Letter of Credit that meets the requirements set forth in the definition of Performance Security. For avoidance of doubt, and notwithstanding anything to the contrary in this Section 8.8 or elsewhere in this Agreement, Seller’s replenishment obligation with respect to the Performance Security shall be limited such that the total amount of any replenishments of the Performance Security shall not exceed two (2) times the amount of the original Performance Security (i.e., the total replenishments of the Performance Security shall not exceed $7,500,000). Seller may at its option (a) exchange one permitted form of Development Security or Performance Security for another permitted form of Development Security or Performance Security, as applicable, as well as (b) change the issuer of Letter of Credit for any such Development Security or Performance Security.

8.9 Buyer Credit Support. If Buyer loses its Investment Grade Credit Rating and if Buyer fails to maintain an ADLH of at least sixty (60) days, then within ten (10) Business Days of such events occurring, Buyer shall provide and maintain for the benefit of Seller credit support in the form of cash or a letter of credit substantially in the form of set forth in Exhibit Q (the “Buyer Credit Support”) in the amount of ninety dollars ($90)/kW multiplied by the Guaranteed Capacity if prior to the Commercial Operation Date and the Installed Capacity if on or after the Commercial Operation Date. Buyer shall maintain the Buyer Credit Support in full force and effect; provided, however, that if after posting the Buyer Credit Support, Buyer demonstrates compliance with the requirements set forth in Section 8.9 then Buyer shall no longer be required to post the Buyer Credit Support and Seller shall return the Buyer Credit Support to Buyer. Return of any Buyer Credit Support shall not prejudice or diminish Seller’s rights or Buyer’s obligations with respect to any subsequent failure by Buyer to comply with the requirements of Section 8.9, which subsequent failure shall trigger the requirement for Buyer to repost the Buyer Credit Support in accordance with the terms of this Section 8.9. Subject to this Section 8.9 and the other terms of this Agreement governing the Buyer Credit Support requirements, Buyer may change the type and/or issuer (as applicable) of the Buyer Credit Support from time to time and at any time. If the Buyer Credit Support is a Letter of Credit and the issuer of such Letter of Credit (i) fails to maintain the minimum Credit Rating set forth in the definition of Acceptable Issuer, (ii) indicates its intent not to renew such Letter of Credit and such Letter of Credit expires prior to the end of the Contract Term, or (iii) fails to honor Seller’s properly documented request to draw on such Letter of Credit by such issuer, Buyer shall have ten (10) Business Days to either post cash or deliver a substitute Letter of Credit that meets the requirements set forth in the definition of Buyer Credit Support.

For avoidance of doubt, and notwithstanding anything to the contrary in this Section 8.9 or elsewhere in this Agreement, Buyer shall have no replenishment obligation with respect to the Buyer Credit Support.

8.10 First Priority Security Interest in Cash or Cash Equivalent Collateral. To secure its obligations under this Agreement, and until released as provided herein, each Party (the “Posting Party”) hereby grants to the other Party (the “Secured Party”) a present and continuing first-priority security interest (“Security Interest”) in, and lien on (and right to net against), and assignment of the Development Security, Performance Security, Buyer Credit Support, or any other cash collateral and cash equivalent collateral posted by the Posting Party pursuant to Sections 8.7, 8.8, and/or 8.9, as applicable, and any and all interest thereon or proceeds resulting therefrom or from the liquidation thereof, whether now or hereafter held by, on behalf of, or for the benefit of the Secured Party, and the Posting Party agrees to take all action as the Secured Party reasonably requires in order to perfect the Secured Party’s Security Interest in, and lien on (and 170
45 right to net against), such collateral and any and all proceeds resulting therefrom or from the liquidation thereof. Upon or any time after the occurrence of an Event of Default caused by the Posting Party, an Early Termination Date resulting from an Event of Default caused by the Posting Party, or an occasion provided for in this Agreement where the Secured Party is authorized to retain all or a portion of the Development Security, Performance Security, or Buyer Credit Support, as applicable, the Secured Party may do any one or more of the following (in each case subject to the final sentence of this Section 8.10):
(a) Exercise any of its rights and remedies with respect to the Development Security, Performance Security, and Buyer Credit Support, including any such rights and remedies under Law then in effect;
(b) Draw on any outstanding Letter of Credit issued for its benefit and retain any cash held by the Secured Party as Development Security, Performance Security, or Buyer Credit Support; and
(c) Liquidate all Development Security, Performance Security, or Buyer Credit Support (as applicable) then held by or for the benefit of the Secured Party free from any claim or right of any nature whatsoever of the Posting Party, including any equity or right of purchase or redemption by the Posting Party.

The Secured Party shall apply the proceeds of the collateral realized upon the exercise of any such rights or remedies to reduce the Posting Party’s obligations under this Agreement; provided, that the Posting Party shall remain liable for any amounts owing to the Secured Party after such application, except to the extent limited in this Agreement, subject to the Secured Party’s obligation to return any surplus proceeds remaining after such obligations are satisfied in full.

8.11 Financial Statements.
(a) From the Effective Date, Buyer shall provide to Seller unaudited quarterly financial statements within sixty (60) days of the end of each quarter and audited financial statements within one hundred eighty (180) days after the end of each fiscal year; provided, however, that this requirement shall be satisfied if such financial statements are publicly available by such applicable dates on Buyer’s website. Buyer’s annual financial statements shall have been prepared in accordance with generally accepted accounting principles in the United States, consistently applied.
(b) In the event a Guaranty is provided as Performance Security in lieu of cash or a Letter of Credit, Seller shall provide to Buyer, or cause the Guarantor to provide to Buyer, unaudited quarterly and annual audited financial statements of the Guarantor or Guarantor’s ultimate parent (including a balance sheet and statements of income and cash flows), all prepared in accordance with generally accepted accounting principles in the United States, consistently applied, and if applicable, as posted on the website of the Guarantor’s ultimate parent or the Securities Exchange Commission.
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46 ARTICLE 9

NOTICES

9.1 Addresses for the Delivery of Notices. Except as provided in Exhibit D-1, 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 on Exhibit N or at such other address or addresses as a Party may designate for itself from time to time by Notice hereunder.

9.2 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 next Business Day 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 prevailing Pacific Time, on the next Business Day, provided that notice by electronic communication will not be deemed effective until confirmed by return electronic communication from the recipient; 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.

ARTICLE 10

FORCE MAJEURE

10.1 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 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 (including hail); explosion; fire; volcanic eruption; flood; epidemic or pandemic ((including COVID-19) and the efforts of any Governmental Authority to combat such events including any quarantine related to any such epidemic or pandemic); any temporary restraint or restriction imposed by applicable Law or any directive from a governmental authority; landslide; mudslide; sabotage; cyberattack; terrorism; earthquake; or other cataclysmic events; an act of public enemy; war; blockade; civil insurrection; riot; civil disturbance; strikes or other labor 172
47 difficulties caused or suffered by a Party or any third party; or a failure of any final step-up transformer used by the Facility.
(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 Buyer’s ability to buy electric energy 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 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, except to the extent such inability is caused by a Force Majeure Event; (vi) any equipment failure, except if such equipment failure is caused by a Force Majeure Event or with respect to the failure of any final step-up transformer used by the Facility as set forth above in Section 10.1(b); or (vii) Seller’s inability to achieve Construction Start of the Facility following the Guaranteed Construction Start Date or achieve Commercial Operation of the Facility following the Guaranteed Commercial Operation Date unless the cause of such inability is an event that would otherwise constitute a Force Majeure Event as described above; it being understood and agreed, for the avoidance of doubt, that the occurrence of a Force Majeure Event may give rise to a Development Cure Period.

10.2 No Liability If a Force Majeure Event Occurs. 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. 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. Nothing herein shall be construed as permitting that Party to continue to fail to perform after said cause has been removed, provided the suspension of performance due to a claim of Force Majeure Event shall include any reasonable time period for mobilization/re-mobilization. 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. Notwithstanding the foregoing, the occurrence and continuation of a Force Majeure Event shall not (a) suspend or excuse the obligation of a Party to make any payments due hereunder, (b) suspend or excuse the Guaranteed Construction Start Date or the Guaranteed Commercial Operation Date beyond the extensions provided in Exhibit B, or (c) limit Buyer’s right to declare an Event of Default pursuant to Section 11.1(b)(ii) subject to Section 4 of Exhibit B, and receive a Damage Payment upon exercise of Buyer’s rights pursuant to Section 11.2.

10.3 Notice. Within five (5) Business Days of becoming aware of the commencement and effect of a Force Majeure Event, the claiming Party shall provide the other Party with oral notice of the Force Majeure Event, and within two (2) weeks of becoming aware of the commencement and effect of a Force Majeure Event the claiming Party shall provide the other Party with notice in the form of a letter describing in detail the particulars of the occurrence giving 173
48 rise to the Force Majeure claim, including the nature, cause, estimated date of commencement thereof, and the anticipated extent of any delay or interruption in performance. Failure of the claiming Party to provide written notice as required in the preceding sentence constitutes a waiver of a Force Majeure claim for all periods prior to other Party’s receipt of such written notice to the extent the non-claiming Party is materially adversely affected by the claiming Party’s failure to provide timely notice. Upon written request from Buyer, Seller shall provide documentation demonstrating to Buyer’s reasonable satisfaction that the claimed delay was the result of a Force Majeure Event and did not result from Seller’s actions or failure to take reasonable actions. The claiming Party shall promptly 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. The suspension of performance due to a claim of a Force Majeure Event must be of no greater scope and of no longer duration than is reasonably required by the Force Majeure Event.

10.4 Termination Following Force Majeure Event. If a Force Majeure Event has occurred after the Commercial Operation Date that has caused either Party to be wholly or partially unable to perform its obligations hereunder, and the impacted Party has claimed and received relief from performance of its obligations for a consecutive twelve (12)-month period, then the nonclaiming Party may terminate this Agreement upon written Notice to the other Party; provided, however, that Seller shall be entitled to up to an additional six (6) months to remedy the Force Majeure Event if (a) Seller has been unable to remedy the Force Majeure Event within the original twelve (12)-month period despite exercising diligent efforts, and (b) Seller provides to Buyer prior to the expiration of the original twelve (12)-month period (i) a detailed plan reasonably acceptable to an independent, professional engineer selected by Seller and reasonably acceptable to Buyer, with such acceptance not to be unreasonably withheld, conditioned or delayed, licensed in the State of California, that explains how Seller will restore the Facility; (ii) a certificate from a Licensed Professional Engineer attesting that the Facility could not reasonably have been restored to operational status within the original twelve (12)-month period but is reasonably likely to be restored to operational status within the additional six (6)-month period by Seller’s execution of the plan described in this Section 10.4; (iii) detailed monthly reports (due no later than the 15th day of each month) describing the progress of Seller’s efforts to remedy the Force Majeure Event during the prior month; and (iv) Seller continues to make reasonable progress in implementing the detailed plan provided to Buyer or in otherwise resolving the Force Majeure Event. Upon any such termination, neither Party shall have any liability to the other Party, save and except for those obligations specified in Section 2.1(b) and this Section 10.4, and Buyer shall promptly return to Seller any Performance Security then held by Buyer and Seller shall promptly return to Buyer any Buyer Credit Support then held by Seller, each less any amounts drawn in accordance with this Agreement.

ARTICLE 11
DEFAULTS; REMEDIES; TERMINATION

11.1 Events of Default. An “Event of Default” shall mean, (a) with respect to a Party (the “Defaulting Party”) that is subject to the Event of Default the occurrence of any of the following:
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49 (i) the failure by such Party to make, when due, any payment required pursuant to this Agreement and 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 by such Party to perform any material covenant or obligation set forth in this Agreement (except to the extent constituting a separate Event of Default set forth in this Section 11.1; and except for (A) failures to curtail the Facility the exclusive remedies for which are set forth in Section 4.4(c), (B) failures to achieve the Guaranteed Energy Production that do not trigger the provisions of Section 11.1(b)(iii), the exclusive remedies for which are set forth in Section 4.6), and (C) failures related to the timely submission of Settlement Quality Meter Data consistent with the SQMD Plan, the exclusive remedies for which are set forth in the last sentence of Exhibit D, Section (i)), and 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;
(v) such Party assigns this Agreement or any of its rights hereunder other than in compliance with Article 14, if applicable; (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, other than in compliance with other provisions of this Agreement; (vii) the failure by such Party to satisfy the collateral requirements pursuant to Section 8.7, Section 8.8, or Section 8.9, as applicable, within ten (10) Business Days after Notice from the other Party, including the failure to replenish the Performance Security amount or the Buyer Credit Support, as applicable, in accordance with this Agreement in the event such other Party draws against it for any reason other than to satisfy a Termination Payment; or (viii) with respect to any outstanding Letter of Credit provided for the benefit of the other Party that is not then required under this Agreement to be canceled or returned, the failure by such Party to provide for the benefit of such other Party either cash or a substitute Letter of Credit from a different issuer meeting the criteria set forth in the definition of Letter of Credit, or, in the case of the Performance Security required to be provided by Seller, a Guarantor meeting the requirements of this Agreement, in each case, in the amount required hereunder within 175
50 ten (10) Business Days after such Party 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 Fitch 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;
(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) such Party 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, and in no event less than sixty (60) days prior to the expiration of the outstanding Letter of Credit.
(b) with respect to Seller as the Defaulting Party, the occurrence of any of the following:
(i) if at any time, Seller delivers or attempts to deliver electric energy to the Delivery Point for sale under this Agreement that was not generated or discharged by the Facility;
(ii) the failure by Seller to achieve Commercial Operation within onehundred eighty (180) days after the Guaranteed Commercial Operation Date; (iii) if, in any Performance Measurement Period during the Delivery Term, the Adjusted Energy Production amount is not at least sixty-five percent (65%) of the Expected Energy amount;
(iv) with respect to any Guaranty provided for the benefit of Buyer, the failure by Seller to provide for the benefit of Buyer either (1) cash, (2) a replacement Guaranty from a different Guarantor meeting the criteria set forth in the definition of Guarantor, or (3) a replacement Letter of Credit from an issuer meeting the criteria set forth in the definition of 176
51 Acceptable Issuer, 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) if any representation or warranty made by the Guarantor in connection with this Agreement 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; (B) the failure of the Guarantor to make any payment required in connection with this Agreement;
(C) the Guarantor becomes Bankrupt;
(D) the Guarantor shall fail to meet the criteria for an acceptable Guarantor as set forth in the definition of Guarantor;
(E) the failure of the Guaranty to be in full force and effect (other than in accordance with its terms) prior to the indefeasible satisfaction of all obligations of Seller hereunder; or
(F) the Guarantor shall repudiate, disaffirm, disclaim, or reject, in whole or in part, or challenge the validity of any Guaranty.

11.2 Remedies; Declaration of Early Termination Date. If an Event of Default with respect to a Defaulting Party shall have occurred and be continuing, the other Party (“NonDefaulting 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 (in the case of an Event of Default by Seller occurring before the Commercial Operation Date, including an Event of Default under Section 11.1(b)(ii) subject to the limitations in Section 11.7), or (ii) the Termination Payment calculated in accordance with Section 11.3 below (in the case of any other Event of Default by either Party); (c) to withhold any payments due to the Defaulting Party under this Agreement; (d) to suspend performance; or
(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;
177
52 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 the Terminated Transaction and the Event of Default related thereto, and further provided, promptly upon Buyer’s receipt of the Damage Payment or Termination Payment, as applicable, Buyer shall return to Seller the Development Security or the Performance Security to the extent either of them, as applicable, did not comprise (i.e., was not used as) the Damage Payment or the Termination Payment, as applicable, and further provided, promptly upon Seller’s receipt of the Termination Payment, as applicable, Seller shall return to Buyer the Buyer Credit Support to the extent it did not comprise (i.e., was not used as) the Termination Payment.

11.3 Termination Payment. The Termination Payment (“Termination Payment”) for the Terminated Transaction shall be the aggregate of all Settlement Amounts plus any or all other outstanding amounts due to or from the Non-Defaulting Party for Product delivered and any Deemed Delivered Energy as of the Early Termination Date, netted into a single amount. If the Non-Defaulting Party’s aggregate Gains exceed its aggregate Losses and Costs, if any, resulting from the termination of this Agreement, the net Settlement Amount shall be zero. The NonDefaulting 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 (a) the actual damages that the Non-Defaulting Party would incur in connection with the Terminated Transaction would be difficult or impossible to predict with certainty, (b) the Damage Payment or Termination Payment described in Section 11.2 or this Section 11.3 (as applicable) is a reasonable and appropriate approximation of such damages, and (c) the Damage Payment or Termination Payment described in Section 11.2 or this Section 11.3 (as applicable) is the exclusive remedy of the Non-Defaulting Party in connection with the 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.

11.4 Notice of Payment of Damage Payment or Termination Payment. As soon as practicable after a Terminated Transaction, 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 Damage Payment or Termination Payment, as applicable, is due to or from the Non-Defaulting Party. The Notice shall include a written statement explaining in reasonable detail the calculation of such amount and the sources for such calculation. The Damage Payment or Termination Payment, as applicable, shall be made to or from the Non-Defaulting Party, as applicable, within ten (10) Business Days after such Notice is effective.

11.5 Disputes With Respect to Damage Payment or Termination Payment. If the Defaulting Party disputes the Non-Defaulting Party’s calculation of the Damage Payment or the Termination Payment, as applicable, in whole or in part, the Defaulting Party shall, within ten (10) Business Days of receipt of the Non-Defaulting Party’s calculation of the Damage Payment or the Termination Payment, as applicable, provide to the Non-Defaulting Party a detailed written 178
53 explanation of the basis for such dispute. Disputes regarding the Damage Payment or Termination Payment, as applicable, shall be determined in accordance with Article 15.

11.6 Rights And Remedies Are Cumulative. Except where an express and exclusive remedy or measure of liquidated damages is provided, the rights and remedies of a Party pursuant to this Article 11 shall be cumulative and in addition to the rights of the Parties otherwise provided in this Agreement. Any Non-Defaulting Party shall be obligated to use commercially reasonable efforts to mitigate its Costs, Losses and damages resulting from or arising out of any Event of Default of the other Party under this Agreement.

11.7 Seller’s Pre-COD Liability Limitation. Notwithstanding any other provision of this Agreement, Seller’s aggregate liability under this Agreement, including arising out of a termination of this Agreement, prior to the Commercial Operation Date shall not exceed an amount equal to the Damage Payment.

ARTICLE 12
LIMITATION OF LIABILITY AND EXCLUSION OF WARRANTIES.

12.1 No Consequential Damages. EXCEPT TO THE EXTENT PART OF AN

EXPRESS REMEDY OR MEASURE OF DAMAGES HEREIN, OR INCLUDED IN A

LIQUIDATED DAMAGES CALCULATION, OR ARISING FROM FRAUD, NEITHER

PARTY SHALL BE LIABLE TO THE OTHER OR ITS INDEMNIFIED PERSONS FOR ANY

SPECIAL, PUNITIVE, EXEMPLARY, INDIRECT, OR CONSEQUENTIAL DAMAGES, OR

LOSSES OR DAMAGES FOR LOST REVENUE OR LOST PROFITS, WHETHER

FORESEEABLE OR NOT, ARISING OUT OF, OR IN CONNECTION WITH THIS AGREEMENT, BY STATUTE, IN TORT OR CONTRACT.

12.2 Waiver and Exclusion of Other Damages. EXCEPT AS EXPRESSLY SET

FORTH HEREIN, THERE IS NO WARRANTY OF MERCHANTABILITY OR FITNESS FOR

A PARTICULAR PURPOSE, AND ANY AND ALL IMPLIED WARRANTIES ARE DISCLAIMED. THE PARTIES CONFIRM THAT THE EXPRESS REMEDIES AND

MEASURES OF DAMAGES PROVIDED IN THIS AGREEMENT SATISFY THE ESSENTIAL PURPOSES HEREOF. ALL LIMITATIONS OF LIABILITY CONTAINED IN

THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION, THOSE PERTAINING TO SELLER’S LIMITATION OF LIABILITY AND THE PARTIES’ WAIVER OF

CONSEQUENTIAL DAMAGES, SHALL APPLY EVEN IF THE REMEDIES FOR BREACH OF WARRANTY PROVIDED IN THIS AGREEMENT ARE DEEMED TO “FAIL OF THEIR ESSENTIAL PURPOSE” OR ARE OTHERWISE HELD TO BE INVALID OR UNENFORCEABLE.

FOR BREACH OF ANY PROVISION FOR WHICH AN EXPRESS AND EXCLUSIVE

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 DAMAGES ONLY. THE 179
54 VALUE OF ANY RENEWABLE ENERGY INCENTIVES, DETERMINED ON AN AFTERTAX BASIS, LOST DUE TO BUYER’S DEFAULT (WHICH SELLER HAS NOT BEEN ABLE

TO MITIGATE AFTER USE OF REASONABLE EFFORTS) INCLUDING AMOUNTS DUE

IN CONNECTION WITH THE LOSS OR RECAPTURE OF ANY RENEWABLE ENERGY INCENTIVES, IF ANY, SHALL BE DEEMED TO BE DIRECT DAMAGES.

TO THE EXTENT ANY DAMAGES REQUIRED TO BE PAID HEREUNDER ARE LIQUIDATED, INCLUDING UNDER SECTIONS 4.4(c), 4.6, 11.2, 11.3 AND 11.7, AND AS

PROVIDED IN EXHIBIT B AND EXHIBIT G 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.

THE PARTIES ACKNOWLEDGE AND AGREE THAT MONEY DAMAGES AND

THE EXPRESS REMEDIES PROVIDED FOR HEREIN ARE AN ADEQUATE REMEDY FOR

THE BREACH BY THE OTHER OF THE TERMS OF THIS AGREEMENT, AND EACH

PARTY WAIVES ANY RIGHT IT MAY HAVE TO SPECIFIC PERFORMANCE WITH RESPECT TO ANY OBLIGATION OF THE OTHER PARTY UNDER THIS AGREEMENT.

ARTICLE 13
REPRESENTATIONS AND WARRANTIES; AUTHORITY

13.1 Seller’s Representations and Warranties. As of the Effective Date, Seller represents and warrants as follows:
(a) Seller is a limited liability company, duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation, and is or will be qualified to conduct business in the state of California and each jurisdiction where the failure to so qualify would have a material adverse effect on the business or financial condition of Seller. (b) Seller has the power and authority to enter into and (subject to potential management, board, or board committee approvals as and when required for the applicable performance obligations) perform this Agreement and is not prohibited from entering into this Agreement or discharging and (subject to the foregoing parenthetical) performing all covenants and obligations on its part to be performed under and pursuant to this Agreement, except where such failure does not have a material adverse effect on Seller’s performance under this Agreement.

The execution, delivery and (subject to the foregoing parenthetical) performance of this Agreement by Seller has been duly authorized by all necessary limited liability company action on the part of Seller and does not and will not require the consent of any trustee or holder of any indebtedness or other obligation of Seller or any other party to any other agreement with Seller. 180
55 (c) The execution and delivery of this Agreement, consummation of the transactions contemplated herein, and fulfillment of and compliance by Seller with the provisions of this Agreement will not conflict with or constitute a breach of or a default under any Law presently in effect having applicability to Seller, subject to any permits that have not yet been obtained by Seller, the documents of formation of Seller or any outstanding trust indenture, deed of trust, mortgage, loan agreement or other evidence of indebtedness or any other agreement or instrument to which Seller is a party or by which any of its property is bound. (d) This Agreement has been duly executed and delivered by Seller. This Agreement is a legal, valid and binding obligation of Seller enforceable in accordance with its terms, except as limited by laws of general applicability limiting the enforcement of creditors’ rights or by the exercise of judicial discretion in accordance with general principles of equity. (e) The Facility is located in the State of California.

13.2 Buyer’s Representations and Warranties. As of the Effective Date, Buyer represents and warrants as follows:
(a) Buyer is a validly existing California joint powers authority, and has the legal power and authority to own its properties, to carry on its business as now being conducted and to enter into this Agreement, and to carry out the transactions contemplated hereby, and to perform and carry out all covenants and obligations on its part to be performed under and pursuant to this Agreement.
(b) The execution, delivery and performance by Buyer of this Agreement (i) have been duly authorized by all necessary action, and does not and will not require any consent or approval of Buyer’s regulatory or governing bodies, other than that which has been obtained; (ii) will not conflict with or constitute a breach of or a default under the documents of formation of Buyer, or any outstanding trust indenture, deed of trust, mortgage, loan agreement or other evidence of indebtedness or any other agreement or instrument to which Buyer is a party or by which any of its property is bound; and (iii) does not violate any federal, state, and local law, including the California Government Code and similar laws. (c) This Agreement constitutes the legal, valid and binding obligation of Buyer enforceable in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws relating to or affecting the enforcement of creditors’ rights generally or by general equitable principles, regardless of whether such enforceability is considered in a proceeding in equity or at law. (d) With respect to its contractual obligations under this Agreement, Buyer cannot 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 (collectively, “Sovereign Immunity”).

13.3 General Covenants. Each Party (unless otherwise specified) covenants that commencing on the Effective Date (unless otherwise specified) and continuing throughout the Contract Term:
181
56 (a) It shall continue to be duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation and it is or shall 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;
(b) It shall maintain (or obtain from time to time as required) all regulatory authorizations, approvals and permits necessary for the operation of the Facility and 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. (d) Buyer will not claim immunity on the grounds of Sovereign Immunity (e) Seller or its Affiliate as of the Commercial Operation Date shall have, and shall maintain during the Delivery Term, Site Control necessary to enable Seller to satisfy the obligations of the Seller under this Agreement.

13.4 Prevailing Wage. Seller shall use reasonable efforts to ensure that all employees hired by Seller, and its contractors and subcontractors, that will perform construction work or provide services at the Site related to construction of the Facility are paid wages at rates not less than those prevailing for workers performing similar work in the locality as provided by applicable California law, if any (“Prevailing Wage Requirement”). Without limiting the generality of the foregoing, Buyer agrees that Seller’s obligations under this Section 13.4 will be satisfied upon the execution of a community workforce agreement, work site agreement, project labor agreement, collective bargaining agreement, or other similar agreement by Seller’s primary EPC contractor related to construction of the Facility. Nothing herein shall require Seller, its contractors and subcontractors to comply with, or assume liability created by other inapplicable provisions of any California labor laws.

ARTICLE 14

ASSIGNMENT

14.1 General Prohibition on Assignments. Except as provided below in this Article 14, 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 purported assignment made without the required written consent, or in violation of the conditions to assignment set out below, shall be null and void. Neither Party will have any obligation to provide any consent, or enter into any agreement, that materially and adversely affects any of such Party’s rights, benefits, risks or obligations under this Agreement, or to modify the Agreement, except as set forth below. Buyer shall cooperate with Seller or any Lender or other financing party to execute or arrange for the delivery of any consents, estoppels, and other documents reasonably requested by Seller, Lender, or such other financing party, including the Collateral Assignment Agreement and Estoppel Certificate as provided in Section 14.2 (provided such agreements or consents do not materially and adversely affects any of Buyer’s rights, benefits, risks or obligations under this Agreement), and to consummate any financing or refinancing, including in connection with a financing in which 182
57 the membership interests of Seller or its direct or indirect parent are collaterally assigned in lieu of an assignment of this Agreement.

14.2 Collateral Assignment; Financing Cooperation. Seller has the right to assign this Agreement as collateral for any financing or refinancing of all or a part of the Facility, including through equity or tax equity investments or Portfolio Financings, which may include cross-collateralization or similar arrangements. In connection with any financing or refinancing of the Facility by Seller, upon request of Seller, Buyer shall in good faith work with Seller and Lender to agree upon, execute, and deliver to Seller and Lender (i) a consent to collateral assignment of this Agreement in a form substantially similar to the consent to collateral assignment set forth in Exhibit O (“Collateral Assignment Agreement”) and (ii) an estoppel certificate in a form substantially similar to the estoppel certificate set forth in Exhibit P (“Estoppel Certificate”), such further consents, approvals and acknowledgments as may be reasonable and necessary to facilitate such transactions, provided that such agreement or certificate does not materially and adversely affect any of Buyer’s rights, benefits, risks or obligations under this Agreement. Seller shall be responsible for Buyer’s reasonable third-party costs, including reasonable attorneys’ fees, associated with the preparation, review, execution and delivery of documents in connection with any such Collateral Assignment Agreement or Estoppel Certificate.

14.3 Other Permitted Assignments and Transfers by Seller. In addition to assignments addressed in Section 14.2, Seller may, without the prior written consent of Buyer:
(a) engage in and consummate any transaction that results in a Permitted Transfer; or
(b) transfer or assign this Agreement or undergo a Change of Control in which the assignee or the entity that is the Seller following such Change of Control is a Permitted Transferee.

ARTICLE 15

DISPUTE RESOLUTION

15.1 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 laws of the state of California, without regard to principles of conflicts of laws. 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.

15.2 Venue. The Parties agree that any suit, action or other legal proceeding by or against any party (or its affiliates or designees) with respect to or arising out of this Agreement shall be brought in the federal courts of the United States or the courts of the State of California sitting in San Francisco County, California.

15.3 Judicial Reference. Each of the Parties hereto hereby consents to the adjudication of all claims pursuant to judicial reference as provided in California Code of Civil Procedure Section 638, and the judicial referee shall be empowered to hear and determine all issues in such reference, whether fact or law. Each of the Parties hereto represents that each has reviewed this 183
58 waiver and consent and each knowingly and voluntarily waives its jury trial rights and consents to judicial reference following consultation with legal counsel on such matters. In the event of litigation, a copy of this Agreement may be filed as a written consent to a trial by the court or to judicial reference under California Code of Civil Procedure Section 638 as provided herein.

15.4 Dispute Resolution. In the event of any dispute arising under this Agreement, within ten (10) days following the receipt of a written Notice from either Party identifying such dispute, the Parties shall meet, negotiate and attempt, in good faith, to resolve the dispute quickly and informally without significant legal costs. If the Parties are unable to resolve a dispute arising hereunder within thirty (30) days after Notice of the dispute, the Parties may pursue all remedies available to them at Law in or equity.

ARTICLE 16

INDEMNIFICATION

16.1 Indemnification. Seller agrees to indemnify, defend and hold harmless Buyer and its members, commissioners, officers, employees and agents from and against all third party claims, demands, losses, liabilities, penalties, and expenses (including reasonable attorneys’ fees) for personal injury or death to Persons and damage to the property of any third party to the extent arising out of, resulting from, or caused by the negligent or willful misconduct of Seller, its Affiliates, or its directors, officers, employees, or agents. Nothing in this Section shall enlarge or relieve a Party of any liability to the other for any breach of this Agreement. Buyer shall not be indemnified for its damages resulting from its sole negligence, intentional acts or willful misconduct.

ARTICLE 17

INSURANCE

17.1 Insurance.
(a) Policy Types. Seller shall maintain, or cause to be maintained at its sole expense, policies of insurance in amounts and with coverage as set forth below in this Section

17.1(a) to the extent such policies are reasonably available (or alternative policies as close thereto as reasonably practicable if such policies as set forth in this Section 17.1(a) are not reasonably available):
(1) General Liability. (i) commercial general liability insurance, including products and completed operations and personal injury insurance, in a minimum amount of Two Million Dollars ($2,000,000) per occurrence, and an annual aggregate of not less than Two Million Dollars ($2,000,000), endorsed to provide contractual liability in said amount, specifically covering Seller’s obligations under this Agreement and including Buyer as an additional insured; and (ii) an umbrella insurance policy in a minimum limit of liability of Five Million Dollars ($5,000,000). The amount of insurance required above may be satisfied by any combination of primary and excess insurance.
(2) 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 184
59 accident. With regard to bodily injury by disease, the One Million Dollar ($1,000,000) policy limit will apply to each employee.
(3) 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 California Law. (4) 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.
(5) Construction All-Risk Insurance. Seller shall maintain or cause to be maintained during the construction of the Facility, but only after major electrical generating equipment has arrived at the Facility, until the Commercial Operation Date, construction all-risk form property insurance covering the Facility during such construction periods. (6) 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 (6)(i) and (6)(iii). All subcontractors shall provide a primary endorsement and a waiver of subrogation to Seller for the required coverage pursuant to this Section 17.1(a). (b) Evidence of Insurance. Within forty-five (45) days after execution of the Agreement and upon annual renewal thereafter, Seller shall deliver to Buyer certificates of insurance evidencing such coverage as is required to be in effect at the times specified above. 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. Such insurance shall be primary coverage without right of contribution from any insurance of Buyer. 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.

ARTICLE 18

CONFIDENTIAL INFORMATION

18.1 Definition of Confidential Information. The following constitutes “Confidential Information,” whether oral or written which is delivered or conveyed by one Party (the “Disclosing Party”) to the other Party (the “Receiving Party”): (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 185
60 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.

18.2 Duty to Maintain Confidentiality. Upon receiving or learning of Confidential Information, the Receiving Party will: (a) treat such Confidential Information as confidential and use reasonable care not to divulge such Confidential Information to any third party except as set forth in this Article 18; (b) restrict access to such Confidential Information to only those of its Affiliates and its and their employees, officers, directors, advisors (including legal and accounting advisors), agents, contractors, subcontractors, actual and potential lenders, equity investors (including tax equity), and other financing parties (including Lenders), and actual and potential acquirors and assignees, and with respect to Buyer as the Receiving Party Buyer’s Participating Members, in each case who reasonably need to know it and are bound by confidentiality provisions no less stringent than those in this Article 18; and (c) use such Confidential Information for purposes of administering this Agreement and, in cases where Seller is the Receiving Party, for the purpose of developing, financing, owning, and operating the Facility. Confidential Information will retain its character as Confidential Information but may be disclosed by the Receiving Party if and to the extent such disclosure is required (a) to be made by any requirements of Law, (b) pursuant to an order of a court or (c) in order to enforce this Agreement; provided, each Party shall, to the extent practicable, use reasonable efforts to prevent or limit the disclosure. If the Receiving Party becomes legally compelled (by interrogatories, requests for information or documents, subpoenas, summons, civil investigative demands, or similar processes or otherwise in connection with any litigation or to comply with any applicable Law, order, regulation, ruling, regulatory request, accounting disclosure rule or standard or any exchange, control area or independent system operator request or rule) to disclose any Confidential Information of the Disclosing Party, Receiving Party shall provide Disclosing Party with prompt notice so that Disclosing Party, at its sole expense, may seek an appropriate protective order or other appropriate remedy. If the Disclosing Party takes no such action after receiving the foregoing notice from the Receiving Party, the Receiving Party is not required to defend against such request and shall be permitted to disclose such Confidential Information of the Disclosing Party, with no liability for any damages that arise from such disclosure. Each Party hereto acknowledges and agrees that information and documentation provided in connection with this Agreement may be subject to the California Public Records Act (Government Code Section 6250 et seq.) and that any request made thereunder may be subject to an exception from disclosure.

18.3 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 in this Article 18. 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 except as otherwise limited under this Agreement, in law, in equity or otherwise, Disclosing Party will be entitled to obtain injunctive relief against the threatened breach of this Article 18 or the continuation of any such breach, without the necessity of proving actual damages or the posting of any bond. 186
61 18.4 Disclosure to Lenders, Etc.. Notwithstanding anything to the contrary in this Article 18, Confidential Information may be disclosed by Seller to any actual or potential Lender or investor or any of their Affiliates, and Seller’s actual or potential agents, consultants, contractors, or trustees, so long as the Person to whom Confidential Information is disclosed agrees in writing to be bound by the confidentiality provisions no less stringent than those in this Article 18.

18.5 Public Announcements. Except as may otherwise be required by applicable Law, neither Party will, nor will it allow its affiliates, contractors and vendors to, make any public announcement, press release or statement regarding this Agreement unless the public announcement, press release or statement is approved in advance by the other Party, in its sole discretion.

ARTICLE 19

MISCELLANEOUS

19.1 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 or any Exhibit, the provisions of first the Cover Sheet, and then this Agreement shall prevail, and such Exhibit shall be corrected accordingly. 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 Party as a result of the preparation, substitution, submission or other event of negotiation, drafting or execution hereof.

19.2 Amendments. This Agreement may only be amended, modified or supplemented by an instrument in writing executed by duly authorized representatives of Seller and Buyer; provided, for the avoidance of doubt, this Agreement may not be amended by electronic mail communications.

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

19.4 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 to the extent set forth herein, any Lender and/or indemnified party). 187
62 19.5 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 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.

19.6 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.

19.7 Counterparts; Electronic Signatures. 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. The Parties may rely on electronic or scanned signatures as originals.

19.8 Electronic Delivery. Delivery of an executed signature page of this Agreement by electronic format (including portable document format (.pdf)) shall be the same as delivery of an original executed signature page.

19.9 Binding Effect. This Agreement shall inure to the benefit of and be binding upon the Parties and their respective successors and permitted assigns.

19.10 No Recourse to Members of Buyer. Buyer is organized as a Joint Powers Agency 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 or Buyer or its constituent members, in connection with this Agreement.

19.11 Forward Contract; Inapplicability/Waiver of Bankruptcy Code Section 366. (a) Each Party acknowledges, intends, and to the extent applicable agrees that (i) this Agreement and the transactions contemplated by this Agreement constitute a “forward contract” and at least one of the Parties is a “forward contract merchant” within the meaning of the United States Bankruptcy Code; (ii) all payments made or to be made by a Party pursuant to this Agreement, including the application by a Party of Performance Security or Buyer Credit 188
63 Support to any amounts due and owing to such Party, constitute “settlement payments” within the meaning of the United States Bankruptcy Code; and (iii) its rights under Section 11.2 of this Agreement constitute a “contractual right to liquidate, terminate or accelerate” or offset under a forward contract within the meaning of ⸹⸹556, 561 of the Bankruptcy Code. (b) Each Party acknowledges and agrees that, upon a Party becoming Bankrupt, the other Party shall be entitled to exercise its rights and remedies under this Agreement in accordance with the safe harbor provisions of the Bankruptcy Code set forth in, inter alia, Sections 362(b)(6), 362(b)(17), 362(b)(27), 546(e), 548(d)(2), 556, and 561 thereof. (c) Each Party acknowledge and agrees that, for all purposes of this Agreement, that the provisions of 11 U.S.C. § 366 in any bankruptcy case or proceeding wherein such Party is a debtor are inapplicable, or if found to be applicable each Party waives and agrees not to assert the applicability of the provisions of 11 U.S.C. § 366 in any bankruptcy case or proceeding wherein such Party is a debtor. In any such bankruptcy case or 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 any other provision of 11 U.S.C. § 101-1532.

19.12 Further Assurances. Each of the Parties hereto agree to provide such information, execute and deliver any instruments and documents and to take such other actions as may be necessary or reasonably requested by the other Party which are not inconsistent with the provisions of this Agreement and which do not involve the assumptions of obligations other than those provided for in this Agreement, to give full effect to this Agreement and to carry out the intent of this Agreement.

19.13 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.
[Signatures on following page]
189
[Signature Page to Renewable Power Purchase Agreement]
IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the Effective Date.
[SUBSIDIARY OF NEXTERA

ENERGY RESOURCES
DEVELOPMENT, LLC], a Delaware
limited liability company
By:

Name:

Title:

NORTHERN CALIFORNIA POWER
AGENCY, a California Joint Action Agency
By:

Name:

Title:
190
Exhibit A - 1

EXHIBIT A

FACILITY DESCRIPTION
Name of Facility: Grace Orchard Energy Center, LLC facility re PPA with NCPA Owner: Seller
Qualified Operator: Seller shall provide notice of the initial Qualified Operator(s) to Buyer at least thirty (30) days prior to Initial Synchronization Site Name: Grace Orchard Energy Center, LLC site re PPA with NCPA (for clarification, the Facility will comprise only a portion of the entire Grace energy complex) Site includes all or some of the following APNs: Seller to provide at least sixty (60) days prior to the Guaranteed Construction Start Date
County: Riverside
CEQA Lead Agency: Lead Agency
Type of Generating Facility: Solar Photovoltaic
Delivery Point: Facility PNode described as [State PNODE] in the CAISO Full Network Model.

P-node: To be established prior to the Commercial Operation Date at the Colorado River Substation bus. Seller shall promptly notify Buyer following the establishment of the P-node Facility Meter: TBD
Facility Interconnection Point: Colorado River Substation Participating Transmission Owner: Southern California Edison Company 191
Exhibit B - 1

EXHIBIT B

MAJOR PROJECT DEVELOPMENT MILESTONES AND COMMERCIAL

OPERATION

1. Major Project Development Milestones.
(a) “Construction Start” will occur upon Seller’s execution of an engineering, procurement, and construction contract (or similar agreement) and issuance thereunder of a notice to proceed that authorizes the contractor to mobilize to Site and begin physical construction 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 J hereto, and the date certified therein by Seller shall be the “Construction Start Date.” The Seller shall cause Construction Start to occur no later than the Guaranteed Construction Start Date. (b) If Construction Start is not achieved by the Guaranteed Construction Start Date, Seller shall pay Construction Start Delay Damages to Buyer on account of such delay.

Construction Start Delay Damages shall be payable to Buyer for each day for which Construction Start has not begun by the Guaranteed Construction Start Date until Seller reaches Construction Start of the Facility, up to 180 days. On or before the tenth (10th) day of each month, Buyer shall invoice Seller for Construction Start Delay Damages, if any, accrued during the prior month and, within thirty (30) days following Seller’s receipt of such invoice, Seller shall pay Buyer the amount of the Construction Start Delay Damages set forth in such invoice. Construction Start Delay Damages shall be refundable to Seller pursuant to Section 2(b) of this Exhibit B. The Parties agree that Buyer’s receipt of Construction Start Delay Damages shall be Buyer’s sole and exclusive remedy for Seller’s unexcused delay in achieving the Guaranteed Construction Start Date, but shall not be construed as Buyer’s declaration that an Event of Default has occurred under any provision of Section 11.1.

2. Commercial Operation of the Facility. “Commercial Operation” means the condition existing when (i) Seller has provided Notice to Buyer substantially in the form of Exhibit H (the “COD Certificate”), and (ii) Seller has notified Buyer in writing that Seller has met the conditions precedent in Section 2.2 for achieving Commercial Operation. The “Commercial Operation Date” shall be the date specified in the COD Certificate. Seller may achieve Commercial Operation prior to the Guaranteed Commercial Operation Date so long as Seller gives written notice thereof to Buyer not less than sixty (60) days prior to the Commercial Operation Date. (a) Seller shall cause Commercial Operation for the Facility to occur by the Guaranteed Commercial Operation Date. Seller shall notify Buyer at least sixty (60) days before the anticipated Commercial Operation Date.
(b) If Seller achieves Commercial Operation on or prior to the Guaranteed Commercial Operation Date, all Construction Start Delay Damages paid by Seller shall be refunded to Seller.

For the purpose of clarity, if Seller does not achieve Commercial Operation on or prior to the Guaranteed Commercial Operation Date, all Construction Start Delay Damages paid by Seller shall not be refunded to Seller. Seller shall include the request for refund of the Construction Start Delay Damages within an invoice to Buyer after Commercial Operation. 192
Exhibit B - 2
(c) If Seller does not achieve Commercial Operation by the Guaranteed Commercial Operation Date, Seller shall pay Commercial Operation Delay Damages to Buyer for each day after the Guaranteed Commercial Operation Date until the Commercial Operation Date, up to 180 days. On or before the tenth (10th) of each month, Buyer shall invoice Seller for Commercial Operation Delay Damages, if any, accrued during the prior month and, within ten (10) Business Days following Seller’s receipt of such invoice, Seller shall pay Buyer the amount of the Commercial Operation Delay Damages set forth in such invoice. The Parties agree that Buyer’s receipt of Commercial Operation Delay Damages shall be Buyer’s sole and exclusive remedy for Seller’s unexcused delay in achieving the Commercial Operation Date on or before the Guaranteed Commercial Operation Date, but shall (x) not be construed as Buyer’s declaration that an Event of Default has occurred under any provision of Section 11.1 and (y) not limit Buyer’s right to declare an Event of Default under Section 11.1(b)(ii) and receive a Damage Payment upon exercise of Buyer’s rights pursuant to Section 11.2.

3. Termination for Failure to Achieve Commercial Operation. If the Facility has not achieved Commercial Operation by the deadline specified in Section 11.1(b)(ii), either Party may elect to terminate this Agreement in accordance with Sections 11.1(b)(ii), 11.2 and this Section 3 of Exhibit B.

4. Extension of the Guaranteed Dates. The Guaranteed Construction Start Date and the Guaranteed Commercial Operation Date shall both be automatically extended on a day-for-day basis (the “Development Cure Period”) for the duration of any and all delays arising out of the following circumstances:
(a) one or more Force Majeure Events;
(b) despite the exercise of diligent and commercially reasonable efforts by Seller, a delay in the issuance of any permit or approval required to own, construct, interconnect, operate or maintain the Facility, or any Interconnection Facilities or Shared Facilities in order to achieve the Construction Start or Commercial Operation;
(c) the Interconnection Facilities or Network Upgrades are not complete and ready for the Facility to connect and sell Product at the Delivery Point by at least four (4) months prior to the Guaranteed Operation Date (as in effect before an extension under this Section 4(c)), despite the exercise of diligent and commercially reasonable efforts by Seller; provided for clarification purposes, any such excused delay under this Section 4(c) will be limited only to the amount of such Interconnection Facilities or Network Upgrades delays, and not, for avoidance of doubt, delays of Seller, if any, which may extend beyond the time of such Interconnection Facilities or Network Upgrades delays; or (d) Buyer has not made all necessary arrangements to receive the Facility Energy at the Delivery Point by the Guaranteed Commercial Operation Date.

Notwithstanding anything in this Agreement to the contrary, the total cumulative Development Cure Period extensions granted under Sections 4(a) through 4(c) and extensions granted under 193
Exhibit B - 3
Section 2.5(a) shall not exceed three hundred and sixty-five (365) days beyond the Guaranteed Commercial Operation Date set forth on the Cover Page, and for avoidance of doubt, there shall be no time limitation to the extent the delay is due to the reason set forth in Section 4(d) above.

For clarity, the permitted extensions under the Development Cure Period extend each of the Guaranteed Construction Start Date and the Guaranteed Commercial Operation Date simultaneously on a day-for-day basis. Notwithstanding anything to the contrary herein, no extension shall be given under a Development Cure Period if, and to the extent that (A) the delay was the result of Seller’s failure to take commercially reasonable actions to meet its requirements and deadlines, or (B) Seller failed to provide requested documentation as provided below. Seller shall provide prompt written notice to Buyer of a delay, but in no case more than thirty (30) days after Seller became aware of such delay, except that in the case of a delay occurring within sixty (60) days of the Guaranteed Commercial Operation Date, or after such date, Seller must provide written notice within five (5) Business Days of Seller becoming aware of such delay. 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 one hundred fifty (150) days after the Commercial Operation Date to install additional capacity 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 I 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 the product of (i) Two Hundred Thousand Dollars ($200,000) and (ii) each MW (or portion thereof) that the Guaranteed Capacity exceeds the Installed Capacity, and the Guaranteed Capacity and other applicable portions of the Agreement shall be adjusted accordingly. 194
Exhibit C - 1

EXHIBIT C

COMPENSATION
Buyer shall compensate Seller for the Product in accordance with this Exhibit C. (a) Contract Price. For each MWh of Facility Energy in each Settlement Period, Buyer shall pay Seller the Contract Price.
(b) Deemed Delivered Energy. For each Settlement Period, Buyer shall pay Seller the Contract Price plus the PTC Amount for each MWh of Deemed Delivered Energy. (c) Excess Contract Year Deliveries Over 115% of Expected Energy. (i) If, at any point in any Contract Year, the amount of Facility Energy plus the amount of Deemed Delivered Energy exceeds one hundred fifteen percent (115%) up to one hundred twenty percent (120%) of the Expected Energy for such Contract Year, the price to be paid for that additional Facility Energy or Deemed Delivered Energy shall be equal to forty percent (40%) of the Contract Price plus the PTC Amount for any Deemed Delivered Energy. (ii) If, at any point in any Contract Year, the amount of Facility Energy plus the amount of Deemed Delivered Energy exceeds one hundred twenty percent (120%) of the Expected Energy for such Contract Year, the price to be paid for that additional Facility Energy or Deemed Delivered Energy shall be equal to twenty-five percent (25%) of the Contract Price plus the PTC Amount for any Deemed Delivered Energy.
(d) Excess Settlement Interval Deliveries. If during any Settlement Interval, Seller delivers Product amounts, as measured by the amount of Facility Energy, in excess of the product of the Guaranteed Capacity and the duration of the Settlement Interval, expressed in hours (“Excess MWh”), then the price applicable to all such Excess MWh in such Settlement Interval shall be zero dollars ($0), and if there is a Negative LMP during such Settlement Interval, Seller shall pay to Buyer an amount equal to the absolute value of the Negative LMP times such Excess MWh.
(e) No Payments in Violation of Any Curtailment Order. Seller shall receive no compensation from Buyer for Facility Energy provided in violation of a Curtailment Order. (f) Negative LMP Strike Price. Buyer may change the Negative LMP Strike Price at its sole discretion by providing written notice to Seller at least two (2) Business Days prior to the effective date of such change, which notice must identify the new Negative LMP Strike Price and the effective date for the new Negative LMP Strike Price; provided, however, that the Negative LMP Strike Price identified by Buyer must be less than or equal to zero dollars per MWh ($0/MWh).
(g) Test Energy. Test Energy is compensated at the Test Energy Rate in accordance with Section 3.6 of the Agreement.
195
Exhibit C - 2
(h) Tax Benefits. The Parties agree that neither the Contract Price nor the Test Energy Rate are subject to adjustment or amendment if Seller fails to receive any Tax Benefits, or if any Tax Benefits expire, are repealed or otherwise cease to apply to Seller or the Facility in whole or in part, or Seller or its investors are unable to benefit from any Tax Benefits. Seller shall bear all risks, financial and otherwise, throughout the Contract Term, associated with Seller’s or the Facility’s eligibility to receive Tax Benefits or to qualify for accelerated depreciation for Seller’s accounting, reporting or Tax purposes. The obligations of the Parties hereunder, including those obligations set forth herein regarding the purchase and price for and Seller’s obligation to deliver Facility Energy and Product, shall be effective regardless of whether the sale of Facility Energy is eligible for, or receives Tax Benefits during the Contract Term. 196
Exhibit D-1 - 1
EXHIBIT D-1

SCHEDULING COORDINATOR RESPONSIBILITIES
(a) Buyer as Scheduling Coordinator for the Facility. Upon Initial Synchronization of the Facility to the CAISO Grid, Buyer shall be the Scheduling Coordinator or designate a qualified third party to provide Scheduling Coordinator services with the CAISO for the Facility for the delivery of Product at the Delivery Point. At least thirty (30) days prior to the Initial Synchronization of the Facility to the CAISO Grid, (i) Seller shall take all actions and execute and deliver to Buyer and the CAISO all documents necessary to authorize or designate Buyer (or Buyer’s designee) as the Scheduling Coordinator for the Facility effective as of the Initial Synchronization of the Facility to the CAISO Grid, and (ii) Buyer shall, and shall cause its designee to, take all actions and execute and deliver to Seller and the CAISO all documents necessary to authorize or designate Buyer or its designee as the Scheduling Coordinator for the Facility effective as of the Initial Synchronization of the Facility to the CAISO Grid. On and after Initial Synchronization of the Facility to the CAISO Grid, Seller shall not authorize or designate any other party to act as the Facility’s Scheduling Coordinator, nor shall Seller perform for its own benefit the duties of Scheduling Coordinator, and Seller shall not revoke Buyer’s authorization to act as the Facility’s Scheduling Coordinator unless agreed to by Buyer. Prior to the Commercial Operation Date, Buyer as Scheduling Coordinator shall reasonably assist with the need for the Facility to test, commission and to timely achieve the Commercial Operation Date, and Buyer shall not provide any scheduling instructions which interferes with those purposes. Buyer (as the Facility’s Scheduling Coordinator) shall submit bids to the CAISO in accordance with this Agreement and the applicable CAISO Tariff, protocols and the Scheduling and operating procedures developed under Exhibit D-2 for Product on a day-ahead, hour-ahead, fifteen-minute market, real time or other market basis that may develop after the Effective Date, as determined by Buyer.
(b) Notices. Buyer (as the Facility’s SC) shall provide Seller with access to a web-based system through which Seller shall submit to Buyer and the CAISO all notices and updates required under the CAISO Tariff regarding the Facility’s status, including, but not limited to, all outage requests, forced outages, forced outage reports, clearance requests, or must offer waiver forms. Seller shall cooperate with Buyer to provide such notices, information and updates in accordance with the applicable requirements of the CAISO Tariff and the Scheduling and operating procedures developed under Exhibit D-2. If the web-based system is not available, Seller shall promptly submit such information to Buyer and the CAISO (in order of preference) telephonically or electronic mail to the personnel designated to receive such information. (c) CAISO Costs and Revenues. Except as otherwise set forth below or elsewhere in this Agreement, Buyer (as Scheduling Coordinator for the Facility) shall be responsible for CAISO costs (including penalties, Imbalance Energy costs or revenues, and other charges) and shall be entitled to all CAISO revenues (including credits, Imbalance Energy revenues or costs, and other payments), including revenues associated with CAISO dispatches, bid cost recovery, Inter-SC Trade credits, or other credits in respect of the Product Scheduled or delivered from the Facility.

Seller shall be liable for and reimburse Buyer for any and all CAISO costs and penalties incurred by Buyer in its role as Scheduling Coordinator under a CAISO settlement statement because of Seller’s failure to perform any covenant or obligation set forth in this Agreement, or Seller’s failure 197
Exhibit D-1 - 2
to comply with applicable provisions of the CAISO Tariff or the outage notification requirements set forth in this Agreement (each except to the extent such non-compliance is caused by Buyer’s failure to perform its duties as Scheduling Coordinator for the Facility). The Parties agree that any Availability Incentive Payments (as defined in the CAISO Tariff) are for the benefit of Seller and for Seller’s account and that any Non-Availability Charges (as defined in the CAISO Tariff) are the responsibility of Seller and for Seller’s account. In addition, if during the Delivery Term, the CAISO implements or has implemented any sanction or penalty related to scheduling, outage reporting, or generator operation, and any such sanctions or penalties are imposed upon the Facility or to Buyer as Scheduling Coordinator due to failure by Seller to abide by the CAISO Tariff or the outage notification requirements set forth in this Agreement, the cost of the sanctions or penalties shall be Seller’s responsibility.
(d) CAISO Settlements. Buyer (as the Facility’s Scheduling Coordinator) shall be responsible for all settlement functions with the CAISO related to the Facility. Buyer shall render a separate invoice to Seller for any CAISO payments, charges or penalties (“CAISO Charges Invoice”) for which Seller is responsible under this Agreement. CAISO Charges Invoices shall be rendered after settlement information becomes available from the CAISO that identifies any CAISO charges. Notwithstanding the foregoing, Seller acknowledges that the CAISO will issue additional invoices reflecting CAISO adjustments to such CAISO charges. Buyer shall review, validate, and if requested by Seller under paragraph (e) below, dispute any charges that are the responsibility of Seller in a timely manner and consistent with Buyer’s existing settlement processes for charges that are Buyer’s responsibilities. Subject to Seller’s right to dispute and to require Buyer to pursue the dispute of any such invoices, Seller shall pay the amount of CAISO Charges Invoices within ten (10) Business Days of Seller’s receipt of the CAISO Charges Invoice.

If Seller fails to pay such CAISO Charges Invoice within that period, Buyer may net or offset any amounts owing to it for such CAISO Charges Invoices against any future amounts it may owe to Seller under this Agreement. The obligations under this Section with respect to payment of CAISO Charges Invoices shall survive the expiration or termination of this Agreement. (e) Dispute Costs. If requested by Seller, Buyer (as the Facility’s SC) shall dispute CAISO settlements in respect of the Facility. Seller agrees to pay Buyer’s costs and expenses (including reasonable attorneys’ fees) associated with its involvement with such CAISO disputes to the extent they relate to CAISO charges payable by Seller with respect to the Facility that Seller has directed Buyer to dispute.
(f) Terminating Buyer’s Designation as Scheduling Coordinator. At least thirty (30) days prior to expiration of this Agreement or as soon as reasonably practicable upon an earlier termination of this Agreement, the Parties will take all actions necessary to terminate the designation of Buyer as Scheduling Coordinator for the Facility as of 11:59 p.m. on such expiration or earlier termination date.
(g) Master Data File and Resource Data Template. Seller shall provide the data to the CAISO (and to Buyer) that is required for the CAISO’s Master Data File and Resource Data Template (or successor data systems) for the Facility consistent with this Agreement. Neither Party shall change such data without the other Party’s prior written consent. (h) NERC Reliability Standards. Buyer (as Scheduling Coordinator) shall cooperate 198
Exhibit D-1 - 3
reasonably with Seller to the extent necessary to enable Seller to comply, and for Seller to demonstrate Seller’s compliance with, NERC reliability standards. This cooperation shall include the provision of information in Buyer’s possession that Buyer (as Scheduling Coordinator) has provided to the CAISO related to the Facility or actions taken by Buyer (as Scheduling Coordinator) related to Seller’s compliance with NERC reliability standards. Buyer (as Scheduling Coordinator) shall be responsible for Buyer’s compliance with NERC reliability standards related to Scheduling Coordinators. Unless otherwise specifically provided for herein, the Parties acknowledge that Buyer and Seller are both individually responsible for compliance with the WECC and NERC reliability standards and criteria applicable to the functions for which each Party is respectively registered with NERC. The reference to WECC and NERC reliability standards, if any, throughout this Agreement does not make any alteration to, or enlargement of, the requirements or standards applicable to each Party beyond their individual registrations with NERC; provided, however, each Party shall perform certain functions on behalf of, or in coordination with, the other Party, as further set forth in this Exhibit D-1. (i) SQMD Reporting. If Seller elects, or is required by the CAISO, to register the Facility as a Scheduling Coordinator Metered Entity, and therefore is required to submit a SQMD Plan for the Facility, then for any time period covered by the CAISO-approved SQMD Plan, and pursuant to Section 7.1(a), Seller shall provide or cause to be provided to Buyer (or Buyer’s designee including any Buyer Scheduling Coordinator) with respect to the Facility Meters, Settlement Quality Meter Data no later than eight (8) Business Days after the relevant flow date.

In connection with any SQMD Plan or designation of the Facility as a Scheduling Coordinator Metered Entity (as defined in the CAISO Tariff), Buyer (as Scheduling Coordinator) shall reasonably cooperate with Seller and any meter data management agent retained by Seller to perform on behalf of the Scheduling Coordinator the SQMD Plan submission and approval process and the obligations required by the SQMD Plan or the CAISO Tariff applicable to a Scheduling Coordinator Metered Entity, including the submission of Settlement Quality Meter Data to the CAISO by the meter data management agent retained by Seller on behalf of Buyer, and such meter data management agent shall assist and support the Scheduling Coordinator with respect to any the submission of required affirmations and attestations by the Scheduling Coordinator (if any).

To enable Seller or Seller’s meter data management agent to submit Settlement Quality Meter Data to the CAISO, Buyer shall grant Seller or Seller’s meter data management agent access to use the MRI-S System (or any alternate system designated by the CAISO) in accordance with the SQMD Plan and the CAISO Tariff; provided, Seller shall indemnify Buyer against any costs or penalties imposed on Buyer (as Scheduling Coordinator) as a result of the failure of Seller or any meter data management agent retained by Seller to submit or cause to be submitted Settlement Quality Meter Data consistent with the SQMD Plan to the CAISO, with respect to the Facility Meter(s). 199
Exhibit D-2 - 1
EXHIBIT D-2

BUYER AND SELLER OPERATING COORDINATION
The Parties shall work together after the Effective Date to develop Scheduling and operating procedures, which the Parties shall finalize no later than thirty (30) days prior to the Commercial Operation Date, or such other date agreed to by the Parties. Procedures may be reviewed annually (date and time to be mutually agreed), or as needed to account for actual Scheduling and operating requirements, to optimize operations for both Parties. The Parties shall cooperate to integrate the systems and controls necessary to implement such procedures. Such procedures to be developed may pertain to the following subjects or as otherwise agreed by the Parties: (i) voice and data communications; (ii) outage management and operational reliability data; (iii) event reporting; (iv) operating instructions and emergency assistance; and (v) Scheduling and bidding. 200
Exhibit E - 1

EXHIBIT E

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

1. Executive Summary.

2. Facility description.

3. Site plan of the Facility.

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

5. Description of any material planned changes to the Facility and the Site.

6. Summary of activities during the previous calendar quarter or month, as applicable.

7. Forecast of activities scheduled for the current calendar quarter.

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 likely to potentially affect Seller’s Milestones or the timing of permitting and interconnection/transmission as they may affect the timing development of the Facility.

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. 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.
201
Exhibit F-1 - 1
EXHIBIT F-1

FORM OF AVERAGE EXPECTED ENERGY REPORT
1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:0
0 11:0
0 12:0
0 13:0
0 14:0
0 15:0
0 16:0
0 17:0
0 18:0
0 19:0
0 20:0
0 21:0
0 22:0
0 23:0
0 24:0
0 JAN
FEB
MAR
APR
MAY
JUN
JUL
AUG
SEP
OCT
NOV
DEC
The foregoing table is provided for informational purposes only, and it shall not constitute, or be deemed to constitute, an obligation of any of the Parties to this Agreement.
202
Exhibit F-2 - 1
EXHIBIT F-2

FORM OF MONTHLY AVAILABLE GENERATING CAPACITY REPORT
Available Generating Capacity, MW Per Hour – [Insert applicable month] 1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00 Day
1 Day
2 Day
3 Day
4 Day
5 [insert additional rows for each day in the month]
Day
29 Day
30 Day
31 The foregoing table is provided for informational purposes only, and it shall not constitute, or be deemed to constitute, an obligation of any of the Parties to this Agreement.
203
Exhibit G - 1

EXHIBIT G

GUARANTEED ENERGY PRODUCTION DAMAGES CALCULATION
In accordance with Section 4.6 of the Agreement, if Seller fails to achieve the Guaranteed Energy Production during any Performance Measurement Period, a liquidated damages payment shall be due from Seller to Buyer, calculated as follows:
[(A – B) * (C – D)]
where:

A = the Guaranteed Energy Production amount for the Performance Measurement Period, in MWh
B = the Adjusted Energy Production amount for the Performance Measurement Period, in MWh
C = The replacement price for the Performance Measurement Period, in $/MWh, which is the sum of (a) the simple average of the Integrated Forward Market hourly price for all the hours in the Performance Measurement Period, as published by the CAISO, for the Existing Zone Generation Trading Hub (as defined in the CAISO Tariff) for the Delivery Point, plus (b) the market value of Replacement Green Attributes.

D = the Contract Price for the Performance Measurement Period, in $/MWh “Adjusted Energy Production” shall mean the sum of the following: Facility Energy + Deemed Delivered Energy + Lost Output.
“Lost Output” has the meaning given in Section 4.6 of the Agreement. The Lost Output shall be calculated in the same manner as Deemed Delivered Energy is calculated, in accordance with the definition thereof.
“Replacement Green Attributes” means PCC1 Renewable Energy Credits of the same Portfolio Content Category (i.e., PCC1) as the Green Attributes portion of the Product and of the same timeframe for retirement as the PCC1 Renewable Energy Credits that would have been generated by the Facility during the Performance Measurement Period.

No payment shall be due if the calculation of (A - B) or (C - D) yields a negative number.

Within sixty (60) days after each Performance Measurement Period, Buyer will send Seller Notice of the amount of damages owing, if any, which shall be payable to Buyer before the later of (a) thirty (30) days of such Notice and (b) ninety (90) days after each Performance Measurement Period; provided the amount of damages owing shall be adjusted to account for Replacement Green Attributes, if any, delivered after each applicable Performance Measurement Period. 204
Exhibit H - 1

EXHIBIT H

FORM OF COMMERCIAL OPERATION DATE CERTIFICATE
This certification (“Certification”) of Commercial Operation is delivered by _______[licensed professional engineer] (“Engineer”) to Northern California Power Agency, a California joint powers agency (“Buyer”) in accordance with the terms of that certain Renewable Power Purchase Agreement dated _______ (“Agreement”) by and between [SELLER ENTITY] 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:

1. The Facility is operational, interconnected, and synchronized with the Transmission System.

2. Seller has installed equipment for the Facility with a nameplate capacity of no less than ninety percent (90%) of the Guaranteed Capacity.

3. The Facility’s testing included a performance test, substantially in the form of Exhibit S to the Agreement, demonstrating peak electrical output of no less than ninety percent (90%) of the Guaranteed Capacity for the Facility at the Delivery Point, adjusted for ambient conditions on the date of the Facility testing, and such peak electrical output, as adjusted, was [peak output in MW].

4. The Transmission Provider has provided documentation supporting release for Commercial Operation on [DATE].

5. 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:

Date:
205
Exhibit I - 1

EXHIBIT I

FORM OF INSTALLED CAPACITY CERTIFICATE
This certification (“Certification”) of Installed Capacity is delivered by [licensed professional engineer] (“Engineer”) to Northern California Power Agency, a California joint powers agency (“Buyer”) in accordance with the terms of that certain Renewable Power Purchase Agreement dated __________ (“Agreement”) by and between [SELLER ENTITY] 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.

I hereby certify the following:

The performance test, substantially in the form of Exhibit S to the Agreement, for the Facility demonstrated peak electrical output of __ MW AC at the Delivery Point, as adjusted for ambient conditions on the date of the performance test (“Installed Capacity”). [LICENSED PROFESSIONAL ENGINEER]
By:

Its:

Date:
206
Exhibit J - 1

EXHIBIT J

FORM OF CONSTRUCTION START DATE CERTIFICATE
This certification of Construction Start Date (“Certification”) is delivered by [SELLER ENTITY] (“Seller”) to Northern California Power Agency, a California joint powers agency (“Buyer”) in accordance with the terms of that certain Renewable Power Purchase 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:
_________________________________________ (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 ________.
[SELLER ENTITY]
By:

Its:

Date:
207
Exhibit K - 1

EXHIBIT K

FORM OF LETTER OF CREDIT
(issued on behalf of Seller for the benefit of Buyer)
IRREVOCABLE AND UNCONDITIONAL STANDBY LETTER OF CREDIT NO. XXXXXXXX ISSUING BANK:

CITIBANK, N.A.

ATTN: US STANDBY UNIT
3800 CITIBANK CENTER, BUILDING B, 1ST FLOOR
TAMPA, FL 33610
PHONE: 866-945-6284
FAX NO.: 609-681-2734
BENEFICIARY:

NORTHERN CALIFORNIA POWER AGENCY, A CALIFORNIA JOINT POWERS AGENCY ................
................
................

APPLICANT:
................
................
................

AMOUNT: USD ................ (................ AND XX/100 UNITED STATES DOLLARS) EXPIRY DATE: ................, 20..

LADIES AND GENTLEMEN:

BY THE ORDER OF ................ (''APPLICANT''), WE, CITIBANK, N.A. AT 3800 CITIBANK CENTER, BUILDING B, 1ST FLOOR, TAMPA, FLORIDA 33610 ATTN: US STANDBY UNIT (''ISSUER'') HEREBY ISSUE OUR IRREVOCABLE STANDBY LETTER OF CREDIT NO. XXXXXXXX (THE ''LETTER OF CREDIT'') IN FAVOR OF NORTHERN

CALIFORNIA POWER AGENCY, A CALIFORNIA JOINT POWERS AGENCY (''BENEFICIARY''), FOR AN AMOUNT NOT TO EXCEED THE AGGREGATE SUM OF USD ................ (................ AND XX/100 UNITED STATES DOLLARS), PURSUANT TO THAT CERTAIN RENEWABLE POWER PURCHASE AGREEMENT DATED AS OF ................,

20.. AND AS AMENDED (THE ''AGREEMENT'') BETWEEN APPLICANT AND BENEFICIARY. THIS LETTER OF CREDIT SHALL BECOME EFFECTIVE IMMEDIATELY AND SHALL EXPIRE ON ................, 20.. WHICH IS ONE YEAR

AFTER THE ISSUE DATE OF THIS LETTER OF CREDIT, OR ANY EXPIRATION DATE EXTENDED IN ACCORDANCE WITH THE TERMS HEREOF (THE ''EXPIRATION DATE'').

FUNDS UNDER THIS LETTER OF CREDIT ARE AVAILABLE TO BENEFICIARY BY PRESENTATION ON OR BEFORE THE

EXPIRATION DATE OF A DATED STATEMENT PURPORTEDLY SIGNED BY YOUR DULY AUTHORIZED REPRESENTATIVE, IN

THE FORM ATTACHED HERETO AS EXHIBIT A, CONTAINING ONE OF THE TWO ALTERNATIVE PARAGRAPHS SET FORTH IN PARAGRAPH 2 THEREIN, REFERENCING OUR LETTER OF CREDIT NO. XXXXXXXX (''DRAWING CERTIFICATE'').

THE ORIGINAL OF THIS LETTER OF CREDIT (AND ALL AMENDMENTS, IF ANY) IS NOT REQUIRED TO BE PRESENTED

IN CONNECTION WITH ANY PRESENTMENT OF A DRAWING CERTIFICATE BY BENEFICIARY HEREUNDER IN ORDER TO RECEIVE PAYMENT.

ALTERNATIVELY, PRESENTATION OF SUCH DRAWING DOCUMENTS MAY BE MADE BY FAX TRANSMISSION TO 609-681- 2734, OR SUCH OTHER FAX NUMBER IDENTIFIED BY CITIBANK, N.A. IN A WRITTEN NOTICE TO YOU. TO THE

EXTENT A PRESENTATION IS MADE BY FAX TRANSMISSION, YOU SHOULD (I) PROVIDE TELEPHONE NOTIFICATION THEREOF TO CITIBANK, N.A. TO 866-945-6284 PRIOR TO OR SIMULTANEOUSLY WITH THE SENDING OF SUCH FAX TRANSMISSION AND (II) SEND THE ORIGINAL OF SUCH DRAWING DOCUMENT(S) TO CITIBANK, N.A., 3800 CITIBANK CENTER, BUILDING B, 1ST FLOOR, TAMPA, FL 33610 BY OVERNIGHT COURIER, PROVIDED, HOWEVER, THAT CITIBANK, N.A.'S RECEIPT OF SUCH TELEPHONE NOTICE OR ORIGINAL DOCUMENT(S) SHALL NOT BE A CONDITION TO PAYMENT HEREUNDER.

WE HEREBY AGREE WITH THE BENEFICIARY THAT UPON PREESENTATION ON OR BEFORE THE EXPIRATION DATE OF YOUR DRAWING DOCUMENTS IN CONFORMITY WITH THE FOREGOING, WE WILL ON [THE NEXT BUSINESS DAY] AFTER

SUCH PRESENTATION, IRREVOCABLY AND WITHOUT RESERVE OR CONDITION MAKE PAYMENT HEREUNDER IN THE 208
Exhibit K
AMOUNT SET FORTH IN THE DRAWING DOCUMENTS. ALL PAYMENTS MADE UNDER THIS LETTER OF CREDIT SHALL BE

MADE WITH ISSUER'S OWN IMMEDIATELY AVAILABLE FUNDS BY MEANS OF WIRE TRANSFER IN IMMEDIATELY

AVAILABLE UNITED STATES DOLLARS TO BENEFICIARY'S ACCOUNT AS INDICATED BY BENEFICIARY IN ITS DRAWING CERTIFICATE OR IN A COMMUNICATION ACCOMPANYING ITS DRAWING CERTIFICATE. WE AGREE THAT IF, ON THE

EXPIRATION DATE, THE OFFICE SPECIFIED ABOVE IS NOT OPEN FOR BUSINESS BY VIRTUE OF AN INTERRUPTION OF THE NATURE DESCRIBED IN THE UNIFORM CUSTOMS ARTICLE 36, THIS LETTER OF CREDIT WILL BE DULY HONORED IF THE SPECIFIED DRAWING DOCUMENTS ARE PRESENTED BY YOU WITHIN THIRTY (30) DAYS AFTER SUCH OFFICE IS REOPENED FOR BUSINESS.

WE AGREE THAT THE TIME SET FORTH HEREIN FOR PAYMENT OF ANY DEMAND(S) FOR PAYMENT IS SUFFICIENT TO

ENABLE US TO EXAMINE SUCH DEMAND(S) AND THE RELATED DOCUMENT(S) REFERRED TO ABOVE WITH CARE SO AS

TO ASCERTAIN THAT ON THEIR FACE THEY APPEAR TO COMPLAY WITH THE TERMS OF THIS LETTER OF CREDIT,

AND THAT IF SUCH DEMNDS(S) AND DOCUMENTS(S) ON THEIR FACE APPEAR TO SO COMPLY, FAILURE TO MAKE ANY SUCH PAYMENT WITHIN SUCH TIME SHALL CONSTITUTE DISHONOR OF SUCH DEMAND(S).

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.

IT IS A CONDITION OF THIS LETTER OF CREDIT THAT THE EXPIRATION DATE SHALL BE DEEMED AUTOMATICALLY

EXTENDED WITHOUT AN AMENDMENT FOR A ONE YEAR PERIOD BEGINNING ON THE PRESENT EXPIRATION DATE HEREOF AND UPON EACH ANNIVERSARY FOR SUCH DATE, UNLESS AT LEAST SIXTY (60) DAYS PRIOR TO ANY SUCH EXPIRATION

DATE WE HAVE SENT TO YOU WRITTEN NOTICE BY OVERNIGHT COURIER SERVICE THAT WE ELECT NOT TO EXTEND THIS LETTER OF CREDIT, IN WHICH CASE IT WILL EXPIRE ON THE DATE SPECIFIED IN SUCH NOTICE. 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.

WE HEREBY ENGAGE WITH YOU THAT YOUR DEMAND(S)FOR PAYMENT IN CONFORMITY WITH THE TERMS OF THIS LETTER OF CREDIT WILL BE DULY HONORED AS SET FORTH ABOVE. ALL FEES AND OTHER COSTS ASSOCIATED WITH

THE ISSUANCE OF ANY DRAWINGS(S) AGAINST THIS LETTER OF CREDIT SHALL BE FOR THE ACCOUNT OF THE APPLICANT. ALL OF THE RIGHTS OF THE BENEFICIARY SET FORTH ABOVE SHLL INURE TO THE BENEFIT OF YOUR SUCCESSORS BY OPERATION OF LAW.

EXCEPT AS FAR AS OTHERWISE EXPRESSLY STATED HEREIN, THIS STANDBY LETTER OF CREDIT IS SUBJECT TO THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY LETTERS OF CREDITS (2007 REVISION), INTERNATIONAL CHAMBER OF COMMERCE, PUBLICATION NO. 600, AND AS TO MATTERS NOT GOVERNED BY THE UCP 600, SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND APPLICABLE U.S.

FEDERAL LAW.

SHOULD YOU HAVE OCCASION TO COMMUNICATE WITH US REGARDING THIS LETTER OF CREDIT, PLEASE DIRECT YOUR

CORRESPONDENCE TO OUR OFFICE, MAKING SPECIFIC MENTION OF THE LETTER OF CREDIT NUMBER INDICATED ABOVE.

THE U.S. GOVERNMENT (INCLUDING, WITHOUT LIMITATION, THE OFFICE OF FOREIGN ASSETS CONTROL OF THE U.S. DEPARTMENT OF THE TREASURY AND THE U.S. DEPARTMENT OF STATE) AND SANCTIONS AUTHORITIES IN

OTHER RELEVANT JURISDICTIONS HAVE IN PLACE SANCTIONS AGAINST CERTAIN JURISDICTIONS, INDIVIDUALS, ENTITIES, AND VESSELS (INCLUDING SHIPS AND AIRCRAFT). ALL PARTIES ACKNOWLEDGE AND AGREE THAT

CITIGROUP ENTITIES, INCLUDING BRANCHES AND SUBSIDIARIES (TOGETHER ''CITIBANK''), RESERVE THE RIGHT,

AT CITIBANK'S REASONABLE DISCRETION, TO REFUSE PERFORMANCE UNDER THIS LETTER OF CREDIT, OR TAKE

OTHER ACTION, WHERE CITIBANK DETERMINES THAT ANY PARTY OR ANY ACTIVITY RELATING, DIRECTLY OR INDIRECTLY, TO THE LETTER OF CREDIT ARE THE SUBJECT OF U.S. SANCTIONS OR SANCTIONS ISSUED BY ANY OTHER RELEVANT SANCTIONS AUTHORITY. ALL PARTIES ACKNOWLEDGE AND AGREE THAT CITIBANK WILL NOT BEAR

ANY LIABILITY WHERE IT REFUSES PERFORMANCE UNDER THIS LETTER OF CREDIT OR TAKES OTHER ACTION IN SUCH CIRCUMSTANCES.

CITI'S GLOBAL PRIVACY NOTICE FOR INSTITUTIONAL CLIENTS AND ITS CALIFORNIA SUPPLEMENTAL PROVISION

CAN BE ACCESSED ONLINE USING DIRECT LINKS ENTITLED 'PRIVACY' AND 'NOTICE AT COLLECTION', WHICH ARE PROMINENTLY DISPLAYED IN THE WEBSITE FOOTER OF WWW.ICG.CITI.COM. 209
Exhibit K

EXHIBIT A
(DRAW REQUEST SHOULD BE ON BENEFICIARY'S LETTERHEAD)

DRAWING CERTIFICATE
TO:

ISSUING BANK:

CITIBANK, N.A.

ATTN: US STANDBY UNIT
3800 CITIBANK CENTER, BUILDING B, 1ST FLOOR
TAMPA, FL 33610
PHONE: 866-945-6284
FAX NO.: 609-681-2734

THE UNDERSIGNED, A DULY AUTHORIZED REPRESENTATIVE OF NORTHERN CALIFORNIA POWER AGENCY, A CALIFORNIA JOINT POWERS AGENCY, AS BENEFICIARY (THE ''BENEFICIARY'') OF THE IRREVOCABLE LETTER OF CREDIT NO.

XXXXXXXX (THE ''LETTER OF CREDIT'') ISSUED BY CITIBANK, N.A. (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 USD ................ (................ AND XX/100 UNITED STATES DOLLARS) BECAUSE A SELLER EVENT OF DEFAULT (AS SUCH TERM

IS DEFINED IN THE AGREEMENT) HAS OCCURRED OR OTHER OCCASION PROVIDED FOR IN THE AGREEMENT WHERE BENEFICIARY IS AUTHORIZED TO DRAW ON THE LETTER OF CREDIT HAS OCCURRED.

OR
BENEFICIARY IS MAKING A DRAWING UNDER THIS LETTER OF CREDIT IN THE AMOUNT OF USD ................ (................ AND XX/100 UNITED STATES DOLLARS), 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 NORTHERN CALIFORNIA POWER AGENCY 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 NORTHERN CALIFORNIA POWER AGENCY BY WIRE TRANSFER IN IMMEDIATELY AVAILABLE FUNDS TO THE FOLLOWING ACCOUNT:
................................
(SPECIFY ACCOUNT INFORMATION)

NORTHERN CALIFORNIA POWER AGENCY, A CALIFORNIA JOINT POWERS AGENCY ................................

NAME AND TITLE OF AUTHORIZED REPRESENTATIVE
DATE: ...................., 20..
210
Exhibit L - 1

EXHIBIT L

FORM OF GUARANTY
This Guaranty (this “Guaranty”) is entered into as of [_____] (the “Effective Date”) by and between [_____], a [______] (“Guarantor”), and Northern California Power Agency, a California joint powers agency (together with its successors and permitted assigns, “Buyer”).

Recitals
A. Buyer and [SELLER ENTITY] (“Seller”), entered into that certain Renewable Power Purchase Agreement (as amended, restated or otherwise modified from time to time, the “PPA”) dated as of [____], 20___.

B. Guarantor is entering into this Guaranty as Performance Security to secure Seller’s obligations under the PPA, as required by Section 8.8 of the PPA.

C. It is in the best interest of Guarantor to execute this Guaranty inasmuch as Guarantor will derive substantial direct and indirect benefits from the execution and delivery of the PPA.

D. Initially capitalized terms used but not defined herein have the meaning set forth in the PPA.

Agreement

1. Guaranty. For good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Guarantor does hereby unconditionally, absolutely and irrevocably guarantee, as primary obligor and not as a surety, to Buyer the full and prompt payment by Seller when due of any and all amounts and payment obligations now or hereafter owing from Seller to Buyer under the PPA (the “Obligations”), including, without limitation, compensation for penalties, the Termination Payment, indemnification payments or other damages, as and when required pursuant to the terms of the PPA; provided, that the Guarantor’s aggregate liability under or arising out of this Guaranty for payment of the Obligations shall not exceed _______________ Dollars ($_______________) (the “Guaranteed Amount”). The Parties understand and agree that any payment by Guarantor or Seller of any portion of the Guaranteed Amount shall thereafter reduce Guarantor’s maximum aggregate liability hereunder on a dollar-for-dollar basis. This Guaranty is an irrevocable, absolute, unconditional and continuing guarantee of the punctual payment, and not of collection, of the Guaranteed Amount and, except as otherwise expressly addressed herein, is in no way conditioned upon any requirement that Buyer first attempt to collect the payment of the Guaranteed Amount from Seller, any other guarantor of the Guaranteed Amount or any other Person or entity or resort to any other means of obtaining payment of the Guaranteed Amount. In the event Seller shall fail to duly, completely or punctually pay any Guaranteed Amount as required pursuant to the PPA, Guarantor shall promptly pay such amount as required herein.

2. Demand Notice. For avoidance of doubt, a payment shall be due for purposes of this Guaranty only when and if a payment is due and payable by Seller to Buyer under the terms and 211
Exhibit L - 2
conditions of the PPA. If Seller fails to pay any Guaranteed Amount as required pursuant to the PPA for five (5) Business Days following Seller’s receipt of Buyer’s written notice of such failure (the “Demand Notice”), then Buyer may elect to exercise its rights under this Guaranty and may make a demand upon Guarantor (a “Payment Demand”) for such unpaid Guaranteed Amount. A Payment Demand shall be in writing and shall reasonably specify in what manner and what amount Seller has failed to pay and an explanation of why such payment is due and owing, with a specific statement that Buyer is requesting that Guarantor pay under this Guaranty. A Payment Demand satisfying the foregoing requirements shall be deemed sufficient notice to Guarantor that it must pay such Guaranteed Amount and Guarantor shall, within five (5) Business Days following its receipt of the Payment Demand, pay the Guaranteed Amount to Buyer. A single written Payment Demand shall be effective as to any specific payment failure by Seller under the PPA that is susceptible of being cured by the payment of money by Guarantor and additional written demands shall not be required until such payment is made.

3. Scope and Duration of Guaranty. This Guaranty applies only to the Guaranteed Amount.

This Guaranty shall continue in full force and effect from the Effective Date until the earlier of the following: (x) all Guaranteed Amounts have been paid in full (whether directly or indirectly through set-off or netting of amounts owed by Buyer to Seller), (y) replacement Performance Security is provided in an amount and form required by the terms of the PPA, or (z) the expiration of the Delivery Term (provided that any such expiration shall not affect Guarantor’s liability hereunder as to obligations incurred or arising under this Guaranty prior to such date. Further, this Guaranty (a) shall remain in full force and effect without regard to, and shall not be affected or impaired by any invalidity, irregularity or unenforceability in whole or in part of this Guaranty, and (b) subject to the preceding sentence, shall be discharged only by complete performance of the undertakings herein. Without limiting the generality of the foregoing, the obligations of the Guarantor hereunder shall not be released, discharged, or otherwise affected and this Guaranty shall not be invalidated or impaired or otherwise affected for the following reasons:
(i) the extension of time for the payment of any Guaranteed Amount, or (ii) any amendment, modification or other alteration of the PPA, or (iii) any indemnity agreement Seller may have from any party, or (iv) any insurance that may be available to cover any loss, except to the extent insurance proceeds are used to satisfy the Guaranteed Amount, or
(v) any voluntary or involuntary liquidation, dissolution, receivership, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition or readjustment of, or other similar proceeding affecting, Seller or any of its assets, including but not limited to any rejection or other discharge of Seller’s obligations under the PPA imposed by any court, trustee or custodian or any similar official or imposed by any law, statue or regulation, in each such event in any such proceeding, or
(vi) the release, modification, waiver or failure to pursue or seek relief with respect to any other guaranty, pledge or security device whatsoever, or 212
Exhibit L - 3
(vii) any payment to Buyer by Seller that Buyer subsequently returns to Seller pursuant to court order in any bankruptcy or other debtor-relief proceeding, or (viii) those defenses based upon (A) the legal incapacity or lack of power or authority of any Person, including Seller and any representative of Seller to enter into the PPA or perform its obligations thereunder, (B) lack of due execution, delivery, validity or enforceability, including of the PPA, or (C) Seller’s inability to pay any Guaranteed Amount or perform its obligations under the PPA, or
(ix) any other event or circumstance that may now or hereafter constitute a defense to payment of the Guaranteed Amount, including, without limitation, statute of frauds and accord and satisfaction;
provided that Guarantor reserves the right to assert for itself any defenses, setoffs or counterclaims that Seller is or may be entitled to assert against Buyer and which have also been available to Guarantor if Guarantor had been in the same contractual position as Seller under the PPA (except for such defenses, setoffs or counterclaims that may be asserted by Seller with respect to the PPA, but that are expressly waived under any provision of this Guaranty).

4. Waivers by Guarantor. Guarantor hereby unconditionally waives as a condition precedent to the performance of its obligations hereunder, with the exception of the requirements in Paragraph 2, (a) notice of acceptance, presentment or protest with respect to the Guaranteed Amounts and this Guaranty, (b) notice of any action taken or omitted to be taken by Buyer in reliance hereon, (c) any requirement that Buyer exhaust any right, power or remedy or proceed against Seller under the PPA, and (d) any event, occurrence or other circumstance which might otherwise constitute a legal or equitable discharge of a surety. Without limiting the generality of the foregoing waiver of surety defenses, it is agreed that the occurrence of any one or more of the following shall not affect the liability of Guarantor hereunder:
(i) at any time or from time to time, without notice to Guarantor, the time for payment of any Guaranteed Amount shall be extended, or such performance or compliance shall be waived; (ii) the obligation to pay any Guaranteed Amount shall be modified, supplemented or amended in any respect in accordance with the terms of the PPA; (iii) subject to Paragraph 9, any (a) sale, transfer or consolidation of Seller into or with any other entity, (b) sale of substantial assets by, or restructuring of the corporate existence of, Seller or (c) change in ownership of any membership interests of, or other ownership interests in, Seller; or
(iv) the failure by Buyer or any other Person to create, preserve, validate, perfect or protect any security interest granted to, or in favor of, Buyer or any Person.

5. Subrogation. Notwithstanding any payments that may be made hereunder by the Guarantor, Guarantor hereby agrees that until the earlier of payment in full of all Guaranteed Amounts or expiration of the Guaranty in accordance with Paragraph 3, it shall not be entitled to, nor shall it seek to, exercise any right or remedy arising by reason of its payment of any Guaranteed Amount under this Guaranty, whether by subrogation or otherwise, against Seller or seek 213
Exhibit L - 4
contribution or reimbursement of such payments from Seller.

6. Representations and Warranties. Guarantor hereby represents and warrants that (a) it has all necessary and appropriate [limited liability company][corporate] powers and authority and the legal right to execute and deliver, and perform its obligations under, this Guaranty, (b) this Guaranty constitutes its legal, valid and binding obligations enforceable against it in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, moratorium and other similar laws affecting enforcement of creditors’ rights or general principles of equity, (c) the execution, delivery and performance of this Guaranty does not and will not contravene Guarantor’s organizational documents, any applicable Law or any contractual provisions binding on or affecting Guarantor which would invalidate or materially impair Guarantor’s ability to perform its obligations under this Guaranty, (d) there are no actions, suits or proceedings pending before any court, governmental agency or arbitrator, or, to the knowledge of the Guarantor, threatened, against or affecting Guarantor or any of its properties or revenues which may, in any one case or in the aggregate, adversely affect the ability of Guarantor to enter into or perform its obligations under this Guaranty, and (e) no consent or authorization of, filing with, or other act by or in respect of, any arbitrator or Governmental Authority, and no consent of any other Person (including, any stockholder or creditor of the Guarantor), that has not heretofore been obtained is required in connection with the execution, delivery, performance, validity or enforceability of this Guaranty by Guarantor.

7. Notices. Notices under this Guaranty shall be deemed received if sent to the address specified below: (i) on the day received if served by overnight express delivery, and (ii) four (4) Business Days after mailing if sent by certified, first class mail, return receipt requested. If transmitted by facsimile, such notice shall be deemed received when the confirmation of transmission thereof is received by the party giving the notice. Any party may change its address or facsimile to which notice is given hereunder by providing notice of the same in accordance with this Paragraph 7.

If delivered to Buyer, to it at [____]
Attn: [____]
Fax: [____]
If delivered to Guarantor, to it at [____]
Attn: [____]
Fax: [____]

8. Governing Law and Forum Selection. This Guaranty shall be governed by, and interpreted and construed in accordance with, the laws of the United States and the State of California, excluding choice of law rules. The Parties agree that any suit, action or other legal proceeding by or against any party (or its affiliates or designees) with respect to or arising out of this Guaranty shall be brought in the federal courts of the United States or the courts of the State of California sitting in the City and County of San Francisco, California.

9. Miscellaneous. This Guaranty shall be binding upon Guarantor and its successors and 214
Exhibit L - 5
assigns and shall inure to the benefit of Buyer and its successors and permitted assigns pursuant to the PPA. No provision of this Guaranty may be amended or waived except by a written instrument executed by Guarantor and Buyer. This Guaranty is not assignable by Guarantor without the prior written consent of Buyer. No provision of this Guaranty confers, nor is any provision intended to confer, upon any third party (other than Buyer’s successors and permitted assigns) any benefit or right enforceable at the option of that third party. This Guaranty embodies the entire agreement and understanding of the parties hereto with respect to the subject matter hereof and supersedes all prior or contemporaneous agreements and understandings of the parties hereto, verbal or written, relating to the subject matter hereof. If any provision of this Guaranty is determined to be illegal or unenforceable (i) such provision shall be deemed restated in accordance with applicable Laws to reflect, as nearly as possible, the original intention of the parties hereto and (ii) such determination shall not affect any other provision of this Guaranty and all other provisions shall remain in full force and effect. This Guaranty may be executed in any number of separate counterparts, each of which when so executed shall be deemed an original, and all of said counterparts taken together shall be deemed to constitute one and the same instrument. This Guaranty may be executed and delivered by electronic means with the same force and effect as if the same was a fully executed and delivered original manual counterpart.
[Signature on next page]
215
Exhibit L- 6
IN WITNESS WHEREOF, the undersigned has caused this Guaranty to be duly executed and delivered by its duly authorized representative on the date first above written.

GUARANTOR:
[_______]
By:______________________________
Printed Name:__________________
Title:____________________________
BUYER:
[_______]
By:______________________________
Printed Name:__________________
Title:____________________________
By:______________________________
Printed Name:__________________
Title:____________________________
216
Exhibit M - 1

EXHIBIT M
[RESERVED]
217
Exhibit N - 1

EXHIBIT N

NOTICES
[Subsidiary of NextEra Energy Resources
Development, LLC]
(“Seller”)
Northern California Power Agency
(“Buyer”)
All Notices:

Street: 700 Universe Blvd.

City: Juno Beach, FL 33408
Attn: Business Management
Phone: 561-691-7723 (Office)
561-301-4685 (Mobile)
Email: DL-NEXTERA-WESTINTERNATIONAL[email protected] and
[email protected]
All Notices:

Street: 651 Commerce Drive
City: Roseville, CA 95678
Attn: Contract Administration
Phone: 916-781-4229
Email: [email protected]
Email: [email protected]
Reference Numbers:

Duns: To be provided separately
Federal Tax ID Number: To be provided
separately
Reference Numbers:

Duns: To be provided separately
Federal Tax ID Number: To be provided
separately
Invoices:

Attn: Business Management
Phone: 561-691-7723 (Office)
561-301-4685 (Mobile)
E-mail: NEER-REVENUE[email protected] and
DL-NEXTERA-WEST-INTERNATIONAL[email protected]
Invoices:

Attn: Accounts Payable
Phone: 916-781-4221 / 4230
Email: [email protected]
Facsimile: 916-781-4255
Scheduling:

Attn: Day-Ahead – Christin Neff; Real-Time –
PMI RT desk
Phone: Day-Ahead - 561-304-6053; Real-Time
– 561-625-7100
Email: dl-nepm-dayaheaddesk[email protected]
and
[email protected]
Scheduling:

Attn: NCPA Scheduling Desk
Phone: (DA CAISO Desk)
916-781-4290
Phone: (Real Time Desk)
916-781-4237
Email: [email protected]
218
Exhibit N - 2
[Subsidiary of NextEra Energy Resources
Development, LLC]
(“Seller”)
Northern California Power Agency
(“Buyer”)
Confirmations:

Attn: Confirmation
Email: DL-Confirmations-Juno[email protected]
Confirmations:

Attn: Tony Zimmer
Phone: 916-781-4229
Email: [email protected]
Payments:

Attn: Business Management
Phone: (561) 694-4725
E-mail: DL-NEXTERA-WESTINTERNATIONAL[email protected] Payments:

Attn: See Invoices
Phone: See Invoices
Email: See Invoices
Wire Transfer: [Seller shall provide to Buyer
the information below at least 60 days prior
to the Commercial Operation Date.]
BNK:

ABA:

ACCT:

Wire Transfer:

BNK: Information provided upon request
ABA:

ACCT:

Notices of an Event of Default:

Subsidiary of NextEra Energy Resources
Development, LLC
700 Universe Blvd.

Juno Beach, FL 33408
Attn: Emre Ergas and Dan Neville
Telephone: (561) 691-2866 & (415) 318-5904
E-mail: [email protected]
and
[email protected] and
DL-NEXTERA-WEST-INTERNATIONAL[email protected]
With a simultaneous copy provided to:

Attn: General Counsel
E-mail: NEER-General[email protected]
and
[email protected]
Notices of an Event of Default to:

Attn: Jane Luckhardt, General Counsel
Phone: 916-781-4268
Facsimile: 916-781-7693
Email: [email protected]
With copy to:

Attn: Tony Zimmer
Phone: 916-781-4229
Email: [email protected]
And
Attn: Mike Whitney
Phone: 916-781-4205
Email: [email protected]
219
Exhibit N - 3
[Subsidiary of NextEra Energy Resources
Development, LLC]
(“Seller”)
Northern California Power Agency
(“Buyer”)
Emergency Contact:

Street: 700 Universe Blvd.

City: Juno Beach, FL 33408
Attn: Business Management
Phone: 561-694-3636
Email: FPDC[email protected]
and
DL-NEXTERA-WEST-INTERNATIONAL[email protected]
Emergency Contact:

Attn: Dispatch and Scheduling
Phone: 916-781-4281 / 4237
Email: Dispatch&[email protected]
220
Exhibit O - 1

EXHIBIT O

FORM OF CONSENT AND AGREEMENT
([NAME OF CONTRACTING PARTY])
([NAME OF ASSIGNED AGREEMENT])
This CONSENT AND AGREEMENT (this “Consent”), dated as of ___________, 20[ ], is executed by and among NORTHERN CALIFORNIA POWER AGENCY, a public entity and joint powers agency organized under the laws of the State of California (the “Contracting Party”), [__________], a [___________] (the “Project Owner”), and [_____________], in its capacity as collateral agent (together with its successors and permitted assigns in such capacity, the “Collateral Agent”) for various financial institutions named from time to time as Lenders under the Credit Agreement (as defined below) and any other parties (or any of their agents) who hold any other secured indebtedness permitted to be incurred under the Credit Agreement (the Collateral Agent and all such parties collectively, the “Secured Parties”).

RECITALS
A. The Project Owner owns, operates and maintains [_________________] (the “Project”).

B. The Contracting Party and the Project Owner have entered into the agreement specified in Schedule I hereto (as further amended, restated, supplemented or otherwise modified from time to time in accordance with the terms thereof and hereof, the “Assigned Agreement”).

C. [__________], as the “Borrower”, the Project Owner and certain other affiliates of the Borrower as “Guarantors”, various financial institutions named therein from time to time as Lenders, [_________________], as the “Administrative Agent” and Collateral Agent, have entered into a Credit Agreement, dated as of [________________] (as amended, modified or supplemented from time to time, the “Credit Agreement”), providing for the extension of the credit facilities described therein to be used, inter alia, to finance the Project Owner’s [development, construction, ownership, operation, and maintenance] of the Project.

D. As security for the payment and performance by the Project Owner of its obligations under the Credit Agreement and the other Financing Documents (as defined below) and for other obligations owing to the Secured Parties, the Project Owner has collaterally assigned all of its right, title and interest in, to and under, and granted a security interest in, the Assigned Agreement to the Collateral Agent, as collateral for the credit facilities under the Credit Agreement, pursuant to the Assignment and Security Agreement, dated as of [_____________________] between the Project Owner and the Collateral Agent (as amended, restated, supplemented or otherwise modified from time to time in accordance with the terms thereof, the "“Security Agreement"”, and, together with the Credit Agreement and any other financing documents relating to the credit extensions thereunder, the “Financing Documents”).

E. It is a requirement under the Credit Agreement that the Project Owner cause the Contracting Party to execute and deliver this Consent. 221
Exhibit O - 2
F. Accordingly, pursuant to Section 14.2 of the Assigned Agreement, the Project Owner has requested that Contracting Party enter into this Consent to provide its consent to the collateral assignment by the Project Owner of its interest in the Assigned Agreement to the Collateral Agent pursuant to the Security Agreement and certain other agreements and undertakings as set forth herein.

NOW, THEREFORE to effectuate the foregoing, and intending to be legally bound, the parties hereto hereby agree as follows:

AGREEMENT

1. Consent to Assignment. The Contracting Party hereby acknowledges and consents to the pledge and assignment of all right, title and interest of the Project Owner in, to and under (but not its obligations, liabilities or duties with respect to) the Assigned Agreement by the Project Owner to the Collateral Agent pursuant to the Security Agreement.

2. Estoppel Certificate; Additional Representations and Warranties. (a) The Contracting Party agrees to deliver to the Collateral Agent a customary estoppel certificate, substantially in the form of Exhibit P to the Assigned Agreement, on the date hereof in accordance with Section 14.2 of the Assigned Agreement. (b) In addition, the Contracting Party, the Collateral Agent, and the Project Owner each hereby represents and warrants, solely with respect to itself, to each other party hereto, as of the date hereof, as follows:
(i) It is an entity duly organized and validly existing under the laws of the jurisdiction of its organization and has the full legal right, power and authority to conduct its business, to own its properties and to execute, deliver and perform its obligations under this Consent. Its execution and delivery of, and performance of its obligations under, this Consent have been duly authorized by all necessary company action. (ii) This Consent constitutes its legal, valid and binding obligation and is enforceable against it in accordance with its terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting the rights of creditors generally and except as the enforceability of this Consent is subject to the application of (A) general principles of equity (regardless of whether considered in a proceeding in equity or at law), including, without limitation, the possible unavailability of specific performance, injunctive relief or any other equitable remedy and (B) concepts of materiality, reasonableness, good faith and fair dealing. (c) The Collateral Agent hereby further represents and warrants, as of the date hereof, that it is duly authorized, on behalf of the Secured Parties it represents, to enter into and perform its obligations under this Consent.

3. Right to Cure.
222
Exhibit O - 3
(a) Upon the occurrence of any event or condition, including an Event of Default (as defined in the Assigned Agreement) by the Project Owner under the Assigned Agreement, that would, either immediately or with the passage of time or giving of notice, or both, entitle the Contracting Party to terminate the Assigned Agreement or suspend the performance of its obligations under the Assigned Agreement (a “Termination Event”), the Contracting Party shall not terminate the Assigned Agreement, suspend the performance of any of its obligations under the Assigned Agreement, or exercise any other remedies with respect to such Termination Event unless and until the Contracting Party first gives Collateral Agent written notice of and the opportunity to cure such Termination Event as provided in Section 3(b). The Contracting Party acknowledges and agrees that: (i) the Collateral Agent shall have the right, but not the obligation, to cure such Termination Event, including by the payment of all sums due under the Assigned Agreement by the Project Owner and the performance of any other act, duty or obligation required of the Project Owner thereunder, in each case as described in Section 3(b), and (ii) the Contracting Party shall accept such cure by the Collateral Agent; provided, that such cure by the Collateral Agent shall be in compliance with the Assigned Agreement (except as expressly provided herein) and this Consent. The Contracting Party further agrees that it shall not, without the prior consent of the Collateral Agent (which consent shall not be unreasonably withheld, delayed or conditioned), assign any obligation under the Assigned Agreement, other than (i) subcontracting such obligations to other parties as permitted by and in accordance with the Assigned Agreement and (ii) as otherwise permitted pursuant to Section 7 hereof. (b) If the Collateral Agent elects to exercise its right to cure a Termination Event as herein provided, it shall have a period to effect such cure of (i) if such Termination Event consists of a payment default, thirty (30) days after the later of (x) receipt by it of the notice from the Contracting Party referred to in Section 3(a) and (y) expiration of the Project Owner’s applicable cure period, if any, under the Assigned Agreement, or (ii) if such Termination Event is an event other than a failure to pay amounts due and owing by the Project Owner (a “Non-monetary Event”), sixty (60) days after the later of (x) receipt by it of the notice from the Contracting Party referred to in Section 3(a) and (y) expiration of the Project Owner’s applicable cure period, if any, under the Assigned Agreement (in each case, or such longer additional period, not to exceed sixty (60) days, as is required to cure such Termination Event so long as the Collateral Agent has commenced and is diligently pursuing appropriate action to cure such Termination Event); provided, however, that (i) if possession of the Project is necessary to cure such Non-monetary Event and the Collateral Agent has commenced and is diligently pursuing such foreclosure proceedings, the Collateral Agent will be allowed a reasonable additional period of time, not to exceed one hundred eighty (180) days in the aggregate with the otherwise applicable cure period, to complete such proceedings and cure such Termination Event, and (ii) if the Collateral Agent is prohibited from curing any such Non-monetary Event by any process, stay or injunction issued by any governmental authority or pursuant to any bankruptcy or insolvency proceeding or other similar proceeding involving the Project Owner, then the time periods specified herein for curing a Termination Event shall be extended for the period of such prohibition, so long as Collateral Agent has diligently pursued removal of such process, stay or injunction, but in no event shall such time period be extended more than one hundred eighty (180) days in the aggregate. (c) Any curing of or attempt to cure any Termination Event shall not be construed as an assumption by the Collateral Agent or the other Secured Parties of any covenants, agreements or obligations of the Project Owner under or in respect of the Assigned Agreement. 223
Exhibit O - 4
(d) Following a Termination Event by the Project Owner under the Assigned Agreement and commencement of the applicable cure period provided for the Collateral Agent set forth in Section 3(b), the Contracting Party may require the Collateral Agent, if the Collateral Agent has elected to cure such Termination Event in accordance with this Section 3, to provide to Contracting Party a report concerning:
(i) The status of efforts by Collateral Agent to develop a plan to cure the Termination Event;
(ii) Impediments to the cure plan or its development;
(iii) If a cure plan has been adopted, the status of the cure plan’s implementation (including any modifications to the plan as well as the expected timeframe within which any cure is expected to be implemented); and (iv) Any other information which Contracting Party may reasonably require related to the development, implementation and timetable of the cure plan.

Collateral Agent must provide the report to Contracting Party within twenty (20) Business Days after Notice from Contracting Party requesting the report. Contracting Party will have no further right to require the report with respect to a particular Termination Event after that Termination Event has been cured.

4. Replacement Agreements. Notwithstanding any provision in the Assigned Agreement to the contrary, in the event the Assigned Agreement is rejected or otherwise terminated as a result of any bankruptcy, insolvency, reorganization or similar proceedings affecting the Project Owner, at the Collateral Agent’s request, the Contracting Party will enter into a new agreement with the Collateral Agent or the Collateral Agent’s designee, provided such entity meets the definition of "Permitted Transferee" as defined in the Assigned Agreement and is an entity that the Contracting Party is permitted to contract with under applicable law, for the remainder of the originally scheduled term of the Assigned Agreement, effective as of the date of such rejection, with the same covenants, agreements, terms, provisions and limitations as are contained in the Assigned Agreement.

5. Substitute Owner. The Contracting Party acknowledges that in connection with the exercise of remedies following a default under the Financing Documents, the Collateral Agent may (but shall not be obligated to) assume, or cause any purchaser at any foreclosure sale or any assignee or transferee under any instrument of assignment or transfer in lieu of foreclosure to assume, all of the interests, rights and obligations of the Project Owner thereafter arising under the Assigned Agreement. Such sale or transfer may be made only to an entity that (i) meets the definition of “Permitted Transferee” as defined in the Assigned Agreement and (ii) is an entity that the Contracting Party is permitted to contract with under applicable law. If the interest of the Project Owner in the Assigned Agreement shall be assumed, sold or transferred as provided above, the assuming party shall agree in a written instrument, executed and delivered and in form and substance reasonably acceptable to the Contracting Party, to be bound by and to assume the terms and conditions of the Assigned Agreement and any and all obligations, covenants and agreements of the Project Owner arising or accruing thereunder from and after the date of such assumption, 224
Exhibit O - 5
and the Contracting Party shall, from and after the date of such assumption, continue to perform its obligations under the Assigned Agreement in favor of the assuming party as if such party had thereafter been named as the “Seller” under the Assigned Agreement; provided that if the Collateral Agent or its designee (or any entity acting on behalf of the Collateral Agent, the Collateral Agent’s designee or any of the other Secured Parties) assumes the Assigned Agreement as provided above, it shall be personally liable for the performance of the obligations thereunder solely to the extent of all of its right, title and interest in and to the Project.

6. Payments. Without limiting the rights of the Contracting Party under the Assigned Agreement to any applicable payment offset, recoupment, abatement, withholding, reduction or defense, the Contracting Party shall make all payments due to the Project Owner under the Assigned Agreement directly into the account specified on Schedule II hereto, or to such other person or account as shall be specified from time to time by the Collateral Agent to the Contracting Party in writing. All parties hereto agree that each payment by the Contracting Party as specified in the preceding sentence of amounts due to the Project Owner from the Contracting Party under the Assigned Agreement shall satisfy the Contracting Party’s corresponding payment obligation under the Assigned Agreement.

7. No Amendments or Waivers of Assigned Agreement. The Contracting Party acknowledges that the Financing Documents restrict the right of the Project Owner to amend or modify the Assigned Agreement, or to waive or provide consents with respect to certain provisions of the Assigned Agreement, unless certain conditions specified in the Financing Documents are met. The Contracting Party shall not, without the prior written consent of the Collateral Agent, which consent shall not be unreasonably withheld, delayed or conditioned, amend or modify the Assigned Agreement in any material respect, or accept any waiver or consent with respect to a material provision of the Assigned Agreement, unless the Contracting Party has received from the Borrower or Project Owner (as applicable under the Financing Documents) a copy of a certificate delivered by the Project Owner to the Collateral Agent to the effect that such amendment, modification, waiver, or consent is being made in accordance with the terms and conditions of the Financing Documents, which may in certain circumstances require the Borrower or Project Owner (as applicable under the financing documents) to have obtained the prior written consent of the Collateral Agent, Lenders, or other parties thereto.

8. Additional provisions.
(a) Project Owner and Collateral Agent acknowledge that the Contracting Party has not made and does not hereby make any representation or warranty, express or implied, that Project Owner has any right, title or interest in the collateral secured by the Financing Documents (the “Collateral”). Collateral Agent acknowledges that it is responsible for satisfying itself as to the existence and extent of Project Owner’s right, title and interest in the Collateral. (b) Except for the representations, warranties, agreements and obligations of Contracting Party expressly provided in this Consent or in any estoppel delivered to the Collateral Agent in accordance with Section 2 hereof, the Collateral Agent acknowledges that (i) the Contracting Party shall not have any contractual obligations to the Collateral Agent, and (ii) the Collateral Agent has not relied upon any representations of the Contracting Party in connection with its lending arrangements with the Project Owner.
225
Exhibit O - 6
(c) Except with respect to the Contracting Party’s representations and warranties and performance of its obligations hereunder and under any estoppel delivered to the Collateral Agent in accordance with Section 2 hereof, the Project Owner and the Collateral Agent acknowledge that the Contracting Party shall have no liability to the Project Owner or the Collateral Agent resulting from or relating to this Consent, or for consenting to any future assignments of the Collateral or any interest of Project Owner or Collateral Agent therein. (d) Project Owner agrees that it shall indemnify and hold Contracting Party harmless from and against any claims, losses, liabilities, damages, judgments, fines, penalties, costs or expenses (including, without limitation, any direct, indirect or consequential claims, losses, liabilities, damages, costs or expenses, including legal fees) in connection with or arising out of this Consent or any of the transactions or transaction documents related to the Financing Documents.
(e) Except as otherwise expressly set forth in this Consent, (i) this Consent does not amend, modify, terminate or waive any of the terms of the Assigned Agreement, and (ii) as between the Contracting Party and the Project Owner, nothing herein shall be construed to amend, modify, terminate or waive their respective rights, obligations, or liabilities thereunder.

9. Notices. Notice to any party hereto shall be in writing and shall be deemed to be delivered on the earlier of: (a) the date of personal delivery, (b) postage prepaid, registered or certified mail, return receipt requested, or sent by express courier, in each case addressed to such party at the address indicated below (or at such other address as such party may have theretofore specified by written notice delivered in accordance herewith), upon delivery or refusal to accept delivery, or (c) if transmitted by facsimile, the date when sent and facsimile confirmation is received; provided that any facsimile communication shall be followed promptly by a hard copy original thereof by express courier:

The Collateral Agent: [________________________]
[ ]
Attn: [ ]
Telephone No.: [ ]
Facsimile No.: [ ]
The Project Owner:
226
Exhibit O - 7
The Contracting Party:

10. Amendment; Waiver. Neither this Consent nor any of the terms hereof may be amended, supplemented, waived or modified except by an instrument in writing signed by the Contracting Party, the Project Owner and the Collateral Agent.

11. Successors and Assigns. This Consent shall be binding upon each party hereto and its successors, transferees and assigns and shall inure to the benefit of the parties hereto and their respective successors, transferees and assigns permitted under and in accordance with this Consent.

12. Counterparts. This Consent may be executed in one or more counterparts with the same effect as if the signatures thereto and hereto were upon the same instrument.

13. Governing Law. This Consent shall be governed by and construed in accordance with the laws of the State of California, without regard to principles of conflicts of laws thereunder.
227
Exhibit O - 8
IN WITNESS WHEREOF, the parties hereto have caused their duly authorized officers to execute and deliver this Consent as of the date first written above. [NAME OF CONTRACTING PARTY] [Note that NCPA is not “Collateral Agent”, so the signature blocks need to reflect three signatures, Contracting Party (NCPA), Collateral Agent (someone for the Lenders), and Project Owner per Paragraph 2 (b) [“In addition, the Contracting Party, the Collateral Agent, and the Project Owner each hereby represents and warrants, solely with respect to itself, to each other party hereto, as of the date hereof, as follow:”] By:

Name:

Title:
[________________________]
as Collateral Agent
By:

Name:

Title:

Acknowledged and Agreed:
[_____________________________]
By:

Name:

Title:
228
Exhibit O - 9
Schedule I
Assigned Agreement
229
Exhibit O - 1
Schedule II
Payment Instructions
(Section 6)
All payments due to the Project Owner pursuant to the Assigned Agreement shall be made to [INSERT REVENUE ACCOUNT INFORMATION].
230
Exhibit P - 1

EXHIBIT P

FORM OF ESTOPPEL CERTIFICATE

ESTOPPEL CERTIFICATE
(Renewable Power Purchase Agreement)
This ESTOPPEL CERTIFICATE (this “Estoppel Certificate”), dated as of ________ __, 202_, is provided by Northern California Power Agency, a joint powers agency of the State of California (“Buyer”).

RECITALS
A. Buyer and ______________________, a Delaware limited liability company (the “Seller”) are parties to that certain Renewable Power Purchase Agreement, dated as of ______________, 202_ (the “Power Purchase Agreement”), in connection with the Grace Orchard solar project (“Solar Project”). A true and complete copy of the Power Purchase Agreement is attached hereto as Exhibit A. Terms used herein but not defined herein shall have the same meanings as in the Power Purchase Agreement.

B. Buyer has been advised by the Seller that Seller is a party to that certain [describe Lender financing agreement].

C. Buyer has been advised by the Seller that pursuant to Section [ __] of the [Lender financing agreement], Seller is required to obtain from Buyer to deliver [to Lender] this Estoppel Certificate as a condition precedent to the consummation of the transactions described therein.

NOW, THEREFORE, in consideration of the foregoing recitals, Buyer hereby certifies and agrees, solely to and for the benefit of [Lender], as of the date hereof as follows:

1. No Event of Default of Buyer exists under the Power Purchase Agreement, and, to the Buyer’s knowledge, no facts or circumstances exist which, with the passage of time and/or giving of notice would constitute an Event of Default of Buyer under the Power Purchase Agreement or which would allow the Seller to terminate the Power Purchase Agreement or suspend performance of Seller’s obligations thereunder.
231
Exhibit P - 2

2. To the Buyer’s knowledge, no Event of Default of Seller exists under the Power Purchase Agreement, and no facts or circumstances exist which, with the passage of time and/or giving of notice would constitute an Event of Default of Seller under the Power Purchase Agreement or which would allow the Buyer to terminate the Power Purchase Agreement or suspend performance of Buyer’s obligations thereunder.

3. To Buyer’s knowledge, no event, act, circumstance or condition constituting a Force Majeure Event, or which, with the passage of time and/or giving of notice would constitute a Force Majeure Event, under the Power Purchase Agreement has occurred and is continuing.

4. All representations and warranties made by Buyer in Section 13.2 of the Power Purchase Agreement were complete, true and correct as of the effective date of the Power Purchase Agreement and continue to be complete, true and correct as of the date hereof.

5. As of the date hereof, (i) the Power Purchase Agreement represents the entire agreement between the Buyer and the Seller with respect to the subject matter thereof, is in full force and effect, and has not been amended, supplemented or modified , and (ii) Buyer has not transferred or assigned all or any part of its right, title, or interest in, to or under the Power Purchase Agreement and has not consented to or received notice of any transfer or assignment of all or any part of Seller’s right, title, or interest in, to or under the Power Purchase Agreement.

6. Except as set forth on Schedule __ hereto, (i) there are no pending, or to Buyer’s knowledge threatened, disputes or legal proceedings between Buyer and the Project Company, and (ii) there is no pending or, to the knowledge of Buyer, threatened action or proceeding involving or relating to Buyer before any court, tribunal, governmental authority or arbitrator which purports to affect the legality, validity or enforceability of the Power Purchase Agreement.

7. Except as set forth on Schedule __ hereto, Buyer has not made any indemnity claims against Seller, and there are no indemnity payments due and owing from Seller, under the Power Purchase Agreement.

8. Except as set forth on Schedule __ hereto, to Buyer’s knowledge, (i) all payments, costs, expenses and other amounts that are required to have been made or paid by Seller to or on behalf of Buyer under the Power Purchase Agreement have been made or paid, (ii) Buyer has no existing counterclaims, offsets, or defenses against Seller under the Power Purchase Agreement, a n d (iii) no facts or circumstances presently exist entitling Buyer to any material claim (including any indemnity claim or claim for liquidated damages), counterclaim or offset against Seller under or in respect of the Power Purchase Agreement.

9. The execution, delivery and performance by Buyer of this Estoppel Certificate 232
Exhibit P - 3
have been duly authorized by all necessary action on the part of Buyer and do not require any approval or consent of any other person or entity and do not violate any provision of any law, regulation, order, judgment, injunction or similar matters or breach any agreement presently in effect with respect to or binding on Buyer.

10. [This paragraph is only included when the estoppel is being delivered to tax equity investors] Buyer agrees that any notices required to be delivered to Seller under Section 11.1 of the Power Purchase Agreement, including notices of an Event of Default, shall be delivered by Buyer to [Lender] at their respective notice addresses set forth on Schedule [__] hereto, and Buyer agrees that [Lender] shall have the right (but not the obligation) to cure the defaults listed in any notice of default in accordance with Section 11.2 of the Power Purchase Agreement within a cure period that is the same length as the cure period afforded to Seller under the Power Purchase Agreement with respect to such event (but in no event less than 30 days in case of monetary defaults and which starts on the later of (i) the same date that the Seller’s cure period expires under the Power Purchase Agreement or (ii) the date that [Lender] receives such notice that lists the default or defaults of the Seller under the Power Purchase Agreement. [Signature page follows]
233
Exhibit P - 4
IN WITNESS WHEREOF, Buyer has caused this Estoppel Certificate to be executed by its undersigned authorized officer as of the date first set forth above. _______________________________
By: _____________________________
Name:
234
Exhibit Q - 1

EXHIBIT Q

FORM OF LETTER OF CREDIT
(issued on behalf of Buyer for the benefit of Seller)
DATE OF ISSUANCE:
[Date of issuance]
[Subsidiary of NextEra Energy Resources Development, LLC] (“Beneficiary”) 700 Universe Blvd.

Juno Beach, FL 33408
Attention: Business Management
Re: [ISSUING BANK] Irrevocable Standby Letter of Credit No.________ Sirs/Mesdames:

We hereby establish in favor of Beneficiary (sometimes alternatively referred to herein as “you”) this Irrevocable Standby Letter of Credit No. _______ (the “Letter of Credit”) for the account of [[_______________________] on behalf of] [Buyer name and address] (“Applicant”), effective immediately and expiring on the date determined as specified in numbered paragraphs 5 and 6 below.

We have been informed that this Letter of Credit is issued pursuant to the terms of that certain Renewable Power Purchase Agreement dated as of [________________], as amended from time to time (the “Agreement”).

1. Stated Amount. The maximum amount available for drawing by you under this Letter of Credit shall be [written dollar amount] United States Dollars (US$[dollar amount]) (such maximum amount referred to as the “Stated Amount”).

2. Drawings. A drawing hereunder may be made by you on any Business Day on or prior to the date this Letter of Credit expires by delivering to [ISSUING BANK], at any time during its business hours on such Business Day, at [bank address] (or at such other address as may be designated by written notice delivered to you as contemplated by numbered paragraph 9 hereof), a copy of this Letter of Credit together with (i) a Draw Certificate executed by an authorized person substantially in the form of Attachment A hereto (the “Draw Certificate”), appropriately completed and signed by your authorized officer (signing as such) and (ii) your draft substantially in the form of Attachment B hereto (the “Draft”), appropriately completed and signed by your authorized officer (signed as such). Funds may be drawn under this Letter of Credit, from time to time, in one or more drawings, in an aggregate amount not exceeding the Stated Amount specified above. Draw Certificates and Drafts under this Letter of Credit may be presented by Beneficiary by means of facsimile or original documents sent by overnight delivery or courier to [ISSUING BANK] at our address set forth above, Attention: ___________ (or at such other address as may be designated by written notice delivered to you as contemplated by numbered paragraph 9 below). If presentation is made by facsimile transmission, you must contact us at [insert phone number] to confirm our receipt of the transmission. In the event of a presentation by facsimile transmission, the original of such documents need not be sent to us.

3. Time and Method for Payment. We hereby agree to honor a drawing hereunder made in compliance with this Letter of Credit by transferring in immediately available funds the amount specified 235
Exhibit Q - 2
in the Draft delivered to us in connection with such drawing to such account at such bank in the United States as you may specify in your Draw Certificate. If the Draw Certificate is presented to us at such address by 12:00 noon, [_______] time on any Business Day, payment will be made not later than our close of business on third succeeding business day and if such Draw Certificate is so presented to us after 12:00 noon, [_______] time on any Business Day, payment will be made on the fourth succeeding Business Day.

We hereby engage with you that provided that the presentation under this Letter of Credit is made on or prior to the Expiration Date and the applicable documents as set forth above conform to the requirements of this Letter of Credit, payment hereunder shall be made.

4. Non-Conforming Demands. If a demand for payment made by you hereunder does not, in any instance, conform to the terms and conditions of this Letter of Credit, we shall give you prompt notice that the demand for payment was not effectuated in accordance with the terms and conditions of this Letter of Credit, stating the reasons therefor and that we will upon your instructions hold any documents at your disposal or return the same to you. Upon being notified that the demand for payment was not effectuated in conformity with this Letter of Credit, you may correct any such non-conforming demand.

5. Expiration. This Letter of Credit shall terminate and expire on the earliest to occur of (i) the close of business on the date on which we receive a Cancellation Certificate in the form of Attachment C hereto executed by your authorized officer and sent along with the original of this Letter of Credit and all amendments (if any) or (ii) our close of business at our aforesaid office on the expiration date as extended in accordance with paragraph 6 below.

6. Initial Period and Automatic Rollover. The initial period of this Letter of Credit shall terminate on [one year from the issuance date] (the “Initial Expiration Date”). The Letter of Credit shall be automatically extended without amendment for one (1) year periods from the Initial Expiration Date or any future expiration date, unless at least sixty (60) days prior to any such expiration date we send you notice by registered mail or courier at your address first shown (or such other address as may be designated by you as contemplated by numbered paragraph 9) that we elect not to consider this Letter of Credit extended for any such additional one year period, in which case it will expire on the date specified in such notice.

7. Business Day. As used herein, “Business Day” shall mean any day on which commercial banks are not authorized or required to close in the State of New York, and inter-bank payments can be effected on the Fedwire system.

8. Governing Law. THIS LETTER OF CREDIT IS GOVERNED BY, AND CONSTRUED IN

ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AND, EXCEPT AS

OTHERWISE EXPRESSLY STATED HEREIN, TO THE INTERNATIONAL STANDBY PRACTICES, ICC PUBLICATION NO. 590 (THE “ISP98”), AND IN THE EVENT OF ANY CONFLICT, THE LAWS

OF THE STATE OF NEW YORK WILL CONTROL, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS.

9. Notices. All communications to you in respect of this Letter of Credit shall be in writing and shall be delivered to the address first shown for you above or such other address as may from time to time be designated by you in a written notice to us. All documents to be presented to us hereunder and all other communications to us in respect of this Letter of Credit, which other communications shall be in writing, shall be delivered to the address for us indicated above, or such other address as may from time to time be designated by us in a written notice to you.

10. Irrevocability. This Letter of Credit is irrevocable.

11. Complete Agreement. This Letter of Credit sets forth in full our undertaking, and such 236
Exhibit Q - 3
undertaking shall not in any way be modified, amended, amplified or limited by reference to any document, instrument or agreement referred to herein, except for the ISP98 and Attachment A, Attachment B and Attachment C hereto and the notices referred to herein and any such reference shall not be deemed to incorporate herein by reference any document, instrument or agreement except as set forth above.

Sincerely,
[ISSUING BANK]
____________________________
By: ________________________
Title: _______________________
Address:
237
Exhibit Q - 4

ATTACHMENT A

FORM OF DRAW CERTIFICATE
The undersigned hereby certifies to [ISSUING BANK] (“Issuer”), with reference to Irrevocable Letter of Credit No. ________________ (the “Letter of Credit”) issued by Issuer in favor of the undersigned (“Beneficiary”), as follows:
(1) The undersigned is the ____________ of Beneficiary and is duly authorized by Beneficiary to execute and deliver this Certificate on behalf of Beneficiary. (2) Beneficiary hereby makes demand against the Letter of Credit by Beneficiary’s presentation of the draft accompanying this Certificate, for payment of _______________________ U.S. dollars (US$__________), which amount, when aggregated together with any additional amount that has not been drawn under the Letter of Credit, is not in excess of the Stated Amount (as in effect of the date hereof).
(3) Beneficiary and [Buyer name] (“Applicant”) are parties to that certain Renewable Power Purchase Agreement dated as of [________________], as amended from time to time (the “Agreement”). (4) Beneficiary is making a drawing under this Letter of Credit because a Buyer Event of Default (as such term is defined in the Agreement) has occurred.

Or
Beneficiary is making a drawing under this 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 instrument within thirty (30) days prior to such expiration date.
(5) You are hereby directed to make payment of the requested drawing to: (insert wire instructions) Beneficiary Name and Address:

By:

Title:

Date:
(6) Capitalized terms used herein and not otherwise defined herein shall have the respective meanings set forth in the Letter of Credit.
[Buyer name]
By:

Title:

Date:
238
Exhibit Q - 5

ATTACHMENT B
DRAWING UNDER IRREVOCABLE LETTER OF CREDIT NO. _________________ Date:

PAY TO: [Subsidiary of NextEra Energy Resources Development, LLC] U.S.$ ___________________
FOR VALUE RECEIVED AND CHARGE TO THE ACCOUNT OF LETTER OF CREDIT NO. __________________.
[Buyer name and address]
By:

Title:

Date:
239
Exhibit Q - 6

ATTACHMENT C

CANCELLATION CERTIFICATE
Irrevocable Letter of Credit No. _______________
The undersigned, being authorized by the undersigned (“Beneficiary”), hereby certifies on behalf of Beneficiary to [ISSUING BANK] (“Issuer”), with reference to Irrevocable Letter of Credit No. ______________ issued by Issuer to Beneficiary (the “Letter of Credit”), that all obligations of [Buyer] (“Applicant”), under the that certain Renewable Power Purchase Agreement dated as of [________________], as amended from time to time (the “Agreement”) have been fulfilled.

Pursuant to Section 5 thereof, the Letter of Credit shall expire upon Issuer’s receipt of this certificate.

Capitalized terms used herein and not otherwise defined herein shall have the respective meanings set forth in the Letter of Credit.
[Subsidiary of NextEra Energy Resources Development, LLC] By:

Title:

Date:
240
Exhibit R - 1

EXHIBIT R

METERING DIAGRAM
Metering Diagram to be provided at least 60 days prior to the Commercial Operation Date. 241
Exhibit S - 1

EXHIBIT S

PERFORMANCE TEST
Solar Energy Center PV
Capacity Test Procedure
Prepared by NextEra Energy Resources xx/xx/2022
Procedure preparer to edit blue text to make specific for the project. 242
Exhibit S - 2
Revision History
Revision
Number Description of Change Date
A Draft xx/xx/2021
0 Execution Version xx/xx/2022
Table of Contents
1 Scope & Purpose....................................................................................................................................... 4 2 Equipment................................................................................................................................................. 5 3 Pre-Test Meeting, Notifications & Check.................................................................................................. 7 4 Calculation Method .................................................................................................................................. 8 5 Data Exclusions....................................................................................................................................... 11 6 Capacity Test Execution ............................................................................................................................ 0 8 Capacity Test Report................................................................................................................................. 1 9 Reference Documents............................................................................................................................... 1 243
Exhibit S - 3
List of Acronyms
Acronym Description
AC Alternating Current
DAS Data Acquisition System
DC Direct Current
MET Meteorology (MET Station)
MST Module Surface Temperature (aka TBOM)
MW Megawatt
NEER NextEra Energy Resources “NextEra”
PF Power Factor
POA Plane of Array
PPA Power Purchase Agreement
PPC Power Plant Controller
RM Reference Module
RTD Resistive Temperature Device
SCADA Supervisory Control and Data Acquisition
STC Standard Test Conditions
W Watt
244
Exhibit S - 4
1 Scope & Purpose
This document defines the Capacity Test procedure for xxxxxxx Solar. It is intended to serve as a guide for performing the Capacity Test and may be subject to change.

The purpose of the Capacity Test is to determine the Tested Capacity of the PV Array at Standard Test Conditions (STC) as measured at the Revenue-Quality Meter at the Solar Collection Substation. The test is performed for a minimum of 3 consecutive days and is considered complete when at least 300 Valid Data Points have been obtained and at least 3 days have passed. Depending on weather conditions more than 3 days may be needed.

The test is deemed successful if the Tested Capacity is equal to or greater than the Guaranteed Capacity shown in Table 1 below.

Guaranteed Capacity
xxx MWAC
Table 1 – Array Capacity Value Per PPA
Note 1: A day is defined as continuous hours between Sunrise and Sunset. 245
Exhibit S - 5
2 Equipment
Table 2 describes the location and quantity of the Measurement Devices used for the test. NextEra will submit the calibration certificates with the Capacity Test Report. Please refer to the calibration certificates for details regarding an instrument’s range and accuracy/uncertainty.

Table 2 - Test Measurement Devices
Test Measurement Devices
Measurement Manufacturer/Model Qty Location
POA Irradiance
POA Pyranometer
Hukseflux SR30 3
Tracker @ MET #1
(INVxxxxx)
Tracker @ MET #2
(INVxxxxx)
Tracker @ MET #3
(INVxxxxx)
POA Irradiance POA Reference Cells
Atonometrics RC18 3
Tracker @ MET #1
(INVxxxxx)
Tracker @ MET #2
(INVxxxxx)
Tracker @ MET #3
(INVxxxxx)
MST (Met Stations)
“Back-Of-Module
Temperature”
RTD (PT1000 Class A PRT)
Campbell Scientific CS240 6
Tracker @ MET #1
(INVxxxxx)
Tracker @ MET #2
(INVxxxxx)
Tracker @ MET #3
(INVxxxxx)
POA Irradiance POA Reference Cell
IMT Solar Si-RS485 TC 13
(Qty 1 per 13 Array Locations)
INVxxxxx, INVxxxxx
INVxxxxx, INVxxxxx
INVxxxxx, INVxxxxx
INVxxxxx, INVxxxxx
INVxxxxx, INVxxxxx
INVxxxxx, INVxxxxx,
INVxxxxx
246
Exhibit S - 6
RPOA Irradiance
(Reflected for
Bifacial Modules)
RPOA Reference Cell
IMT Solar Si-RS485 TC 13
(Qty 1 per 13 Array Locations)
INVxxxxx, INVxxxxx
INVxxxxx, INVxxxxx
INVxxxxx, INVxxxxx
INVxxxxx, INVxxxxx
INVxxxxx, INVxxxxx
INVxxxxx, INVxxxxx,
INVxxxxx
MST (Array)
“Back-Of-Module
Temperature”
RTD (PT1000 Class A PRT)
Omega SA1-RTD 39
(Qty 3 per 13 Array Locations)
INVxxxxx, INVxxxxx
INVxxxxx, INVxxxxx
INVxxxxx, INVxxxxx
INVxxxxx, INVxxxxx
INVxxxxx, INVxxxxx
INVxxxxx, INVxxxxx,
INVxxxxx
AC Power
Schneider Electric Power Logic,
ION8650 Revenue-Grade Meter
(M-161-1) 1
NEER Solar Collection
Substation
247
Exhibit S - 7
3 Pre-Test Meeting, Notifications & Check

3.1 Pre-Test Meeting
Notification will be provided 10 days prior to testing and a pre-test meeting may be held between relevant representatives from NextEra and Off-Taker Entities. If a meeting occurs, notes of the meeting will be taken by NextEra and submitted to the attendees.

3.2 Pre-functional checks
Pre-functional checks will be performed for all equipment and the corresponding functional check sheets will be reviewed by NextEra prior to the start of Performance Testing. Any functional issues that occur during Capacity Testing will be entered into the Commissioning Log by a NextEra representative and will be referenced in the Capacity Test Report. Capacity Testing will be performed when the following conditions are satisfied:
• Weather conditions required to support collection of appropriate range andquantity of test data
• Utility grid voltage is stable and within ±5% of design voltage • There is grid connectivity at each inverter such that a Capacity Test can be accomplished under load
• The site is substantially complete and the systems are in automatic operation.

3.3 Data Acquisition
Prior to the start of the Capacity Test, NextEra will ensure that data points are being recorded by the historian in, at a minimum, 1 minute samples.
248
Exhibit S - 8
4 Calculation Method
The method to calculate capacity is described as follows. This method will be used to determine both daily capacity (an estimate of the Tested Capacity) as well as the overall Tested Capacity of the Plant.

1. At a minimum, the PV plant AC power output, Reference Module irradiance levels, and module surface temperature measurements are collected and recorded.

2. Reference Module irradiance measurements are then averaged; module surface temperature measurements are also averaged.

3. Ideally the plant will operate at power factor of 1.0 during the test however the Transmission Owner or the System Operator may require otherwise for grid support. The Plant AC power output measurement, PM, is corrected to a power factor of 1.0 according to the followingequation:

P1PF = PM ×
PFSTC
PFM
P1PF = AC Power corrected to power factor of 1.0
PM = measured AC power output at the Revenue Meter
PFM = measured power factor at the Revenue Meter
PFSTC = power factor at standard test conditions (1.0pf)

4. Power factor-corrected AC power output, P1PF, is corrected to 25 °C according to the following equation:

PSTC
P1PF = AC Power corrected to 1.0pf
PSTC = AC Power corrected to 25°C
=
P1PF
1 + Ct(TM — 25°C)
Ct = module power temperature coefficient (-0.xxx% /°C, Weighted Average) TM = mean module surface temperature (°C)

5. A plot of PSTC vs. mean Reference Module irradiance is created as shown in Figure 1.

6. A linear fit is then performed for all Valid Data Points (shown in BLUE) while all other data points (shown in RED) are excluded from the regression. These RED data points represent discrete times in the data set where one or more event is present as defined in Section 5 Table 3 of this procedure. The coefficient of determination (R2) for the capacity regression shall be at least 0.92. The linear fit yields an equation of the following form:
y = N ∗ x + b
y = PSTC power (temperature corrected)
N = slope of the line
x = mean Reference Module irradiance (W/m2)
249
Exhibit S - 9
b = y intercept
250
Exhibit S - 10
Note: A Valid Data Point is defined as an instantaneous, 1-minute sample of plant data which has not been excluded according the guidelines in Section 5.

7. The Tested Capacity is determined by evaluating the equation at 1,000 W/m2:

Tested Capacity = y(1000)
Figure 1 – Example linear fit to Temperature-Corrected Power vs. POA Irradiance 251
Exhibit S - 11
5 Data Exclusions
Data will be excluded from the linear fit if and when any of the following events in Table 3 occur. Any point not excluded is considered to be a Valid Data Point.

Table 3 - Data Exclusion Events
Event Definition
Low Irradiance Mean Reference Module irradiance is less than 200 W/m2 High Irradiance Mean Reference Module irradiance is greater than 1200 W/m2 Inverter(s) Offline At least one inverter is offline or otherwise producing minimal power relative to the other inverters such that inverter generation is unable to reach nameplate capacity for site.

Grid Interruption
The Fault State of one or more inverters indicates a Grid Failure, or the Utility grid voltage is more than 5% different from the design voltage. The previous five minutes of data will be excluded the event of a Grid Interruption.

Negative Power Flow The power meter records a net negative power output (power is flowing to the Plant)
Inverter Clipping At least one inverter has reached the AC power set point OR at least one inverter is commanded to less than 100% output by the PPC.

Row-to-Row Shading Direct beam row-to-row shading as confirmed by visual inspection Erratic Irradiance Erratic irradiance is observed
Snow or Frost From visual inspection, there is snow or frost on the modules or critical sensors Irradiance Sensor Failure There are less than X Reference Modules reading correctly (50% of installed quantity and round up)
MST Sensor Failure There are less than XX module surface temperature sensors reading correctly (50% of installed quantity and round up)
SCADA/DAS Failure
There is a system-wide failure to collect critical data, including: irradiance, MST and energy meter AC power. The previous five minutes of data will be excluded the event of a Grid Interruption.
252
Exhibit S - 12
253
Exhibit S - 0
6 Capacity Test Execution

6.1 Daily Capacity Test
A capacity value for each calendar day of the Capacity Test period will be calculated according to the procedure outlined in Section 4, using data points subjected to the exclusions described in Section 5.

For each calendar day of the test, the NextEra Test Manager will do the following:
• Confirm all inverters start up at approximately the same time • Ensure that data is recorded in 1 minute intervals
• Review the Daily Alarm Log and other non-conformance items and ensure that they do not affect the test results

6.2 Tested Capacity
The Tested Capacity of the PV Power Plant will be determined using all Valid Data Points collected over the Capacity Test period. The Tested Capacity value will be calculated according to the procedure outlined in Section 4, using data points subjected to the exclusions described in Section 5. This value will be compared to Guaranteed Capacity shown in Section 1, Table 1 to determine pass/fail.

6.3 Site Specific Test Configuration (Optional)
Site Pre-Test Assumptions:

1. Xxxx

2. Xxxx

3. Xxxx
Site Testing Configuration:

1. Xxxx

2. Xxxx
•
•
•
•
•
•
•
•
254
Exhibit S - 1
7 Capacity Test Report
Following the conclusion of the Capacity Test, NextEra will issue a Capacity Test Report within five (5) business days of the successful completion of the Capacity Test to all relevant parties. The report will include the following:
• Executive summary of testing (e.g., Tested Capacity value, R2value, Daily Capacity Values)
• Instrument calibration certificates
• Test data
• Field notes including non-conformance events (See “Daily Log”) • Capacity calculations
• Conclusions
NextEra will provide the raw test data (consisting of both Valid Data Points and excluded values) and instrument calibration certificates to relevant parties as a separate attachment. This procedure will be appended to the submitted report. 8 Reference Documents
• SCADA Design Drawings – xxxxxxxxxxxxxxxxxxxxxx
• Substation Functional Single Line Diagram – xxxxxxxxxxxxxxxxxxxx 255