WELLS FARGO SECURITIES, LLC

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1 CONSENT SOLICITATION STATEMENT SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY Solicitation of Consents With Respect To Its Gas Project Revenue Bonds (Project No. 1), Series 2007A (Fixed Rate) and Series 2007B (LIBOR Index Rate) (maturities and CUSIP numbers on inside cover page) Record Date: 5:00 p.m. New York City time, July 26, 2013 Solicitation Expiration Date: 5:00 p.m. New York City time, August 23, 2013, unless amended The Southern California Public Power Authority ( SCPPA ) hereby solicits consents (the Consents ) of owners of SCPPA s Gas Project Revenue Bonds (Project No. 1), Series 2007A and Series 2007B (the Bonds ), to Amendments hereinafter described (the Amendments ) upon the terms and conditions set forth in this Consent Solicitation Statement (as the same may be amended or supplemented, the Consent Solicitation Statement ) and the accompanying Consent Form (collectively, the Consent Solicitation ). Bonds and Initial Transaction. The Bonds were issued pursuant to a Trust Indenture, dated as of October 1, 2007, and subsequently amended (the Indenture ), between SCPPA and U.S. Bank National Association, as trustee (the Trustee ), to finance SCPPA s prepayment for five long-term Prepaid Natural Gas Sales Agreements entered into with J. Aron & Co. ( J. Aron ), whose obligations thereunder and certain other contracts are guaranteed by The Goldman Sachs Group, Inc. ( GSG ) under the Goldman Sachs Guaranty. The gas purchased under the Prepaid Natural Gas Sales Agreements is contracted to be sold to five SCPPA member municipal utilities (the Project Participants ) under five Prepaid Natural Gas Program Gas Supply Agreements ( Gas Supply Contracts ) at prices based on monthly indices and hedged under five commodity price swap transactions (the Authority Commodity Swaps ). Amendments. As more fully described in this Consent Solicitation Statement, the Amendments are intended to (a) provide additional credit support for payments by three of the Project Participants by amending and restating the Receivables Purchase Agreement and the Goldman Sachs Guaranty, (b) replace AIG-FP Broadgate Limited with Mitsubishi UFJ Securities International plc as the party to the Authority Commodity Swaps, (c) create a custodial arrangement with respect to payments owed by J. Aron and guaranteed by GSG or to J. Aron under corresponding J. Aron Commodity Swaps in order to mitigate SCPPA s credit exposure to the counterparty under the Authority Commodity Swaps, and (d) replace the investment of the Debt Service Account in an investment agreement with American General Life Insurance Company with an investment agreement with J. Aron guaranteed by GSG and, in consideration for these undertakings by J. Aron and GSG, (e) eliminate a Seller Default in the Prepaid Natural Gas Sales Agreements if GSG fails to maintain an investment grade credit rating from S&P or Moody s and fails to provide credit support on demand. For certain risks associated with the Amendments, see Risk Factors Relating to the Amendments herein. Conditions to Amendments. The Amendments will become effective upon the satisfaction of certain conditions, including but not limited to an increase in the ratings of the Bonds to at least A3 from Moody s and A- from Fitch Ratings while preserving a rating of at least A- from S&P. Further Information. Any questions or requests for assistance may be directed to Wells Fargo Securities, LLC, the solicitation agent for the Consent Solicitation (the Solicitation Agent ), at the address and telephone number set forth on the back cover of this Consent Solicitation Statement. Requests for copies of this Consent Solicitation Statement, the Consent Form and other related materials, and questions related to the Retail Processing Fee described herein, should be directed to D.F. King & Co., Inc. (the Information and Tabulation Agent ) at the telephone numbers set forth on the back cover of this Consent Solicitation Statement. None of SCPPA, the Project Participants, J. Aron, GSG, the Trustee, the Information and Tabulation Agent or the Solicitation Agent makes any recommendation as to whether or not bondholders should consent to the Amendments. The Solicitation Agent for the Consent Solicitation is: Dated: July 30, 2013 WELLS FARGO SECURITIES, LLC

2 MATURITIES AND CUSIP NUMBERS GAS PROJECT REVENUE BONDS (PROJECT NO. 1), SERIES 2007A (FIXED RATE) DUE NOVEMBER 1, OUTSTANDING PRINCIPAL AMOUNT INTEREST RATE CUSIP $ 4,065, % AF ,875, AG ,075, AH ,275, AJ ,605, AK ,385, AL ,445, AM ,725, AN ,940, AP ,705, AQ ,250, AR ,850, AS ,805, AT ,655, AU ,750, AV ,965, AW ,795, AX2 $108,390,000 Series 2007A Term Bonds due November 1, 2033; Rate 5.00%; CUSIP AY0 1 GAS PROJECT REVENUE BONDS (PROJECT NO. 1), SERIES 2007B (INDEX RATE) $36,000,000 Series 2007B Term Bonds due November 1, 2038; Price: 100%; CUSIP AZ7 1 LIMITATION ON INFORMATION No person has been authorized to give any information or make any representations other than those contained or incorporated by reference in this Consent Solicitation Statement and, if given or made, such information or representations must not be relied upon as having been authorized by SCPPA or any other person mentioned herein. This Consent Solicitation Statement is not being made to, and no Consents are being solicited from, persons in any jurisdiction in which it is unlawful to make such Consent Solicitation or grant such Consent. NEITHER THIS CONSENT SOLICITATION STATEMENT NOR THE CONSENT FORM NOR ANY RELATED DOCUMENTS HAVE BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, NOR HAVE THEY BEEN FILED WITH OR REVIEWED BY ANY FEDERAL OR STATE SECURITIES COMMISSION OR REGULATORY AUTHORITY OF ANY COUNTRY. NO AUTHORITY HAS PASSED UPON THE ACCURACY OR ADEQUACY OF THIS CONSENT SOLICITATION STATEMENT OR THE CONSENT FORM OR ANY RELATED DOCUMENTS, AND IT IS UNLAWFUL AND MAY BE A CRIMINAL OFFENSE TO MAKE ANY REPRESENTATION TO THE CONTRARY. 1 CUSIP is a registered trademark of the American Bankers Association. The CUSIP number listed above is being provided solely for the convenience of bondholders only, and SCPPA does not make any representation with respect to such number or undertake any responsibility for its accuracy. The CUSIP number is subject to being changed as a result of various actions including, but not limited to, a refunding in whole or in part of the Bonds. Principal amount reflects cancellation of $165,450,000 of par on October 22, Schedules II and IV of the amended Indenture reflect such a reduction. - ii -

3 TABLE OF CONTENTS BACKGROUND... 1 Purpose of Existing Transactions... 1 Gas Contracts... 1 Commodity Price Swaps... 1 Receivables Purchase Agreement... 2 Debt Service and Debt Service Reserve Accounts... 2 Goldman Sachs Guaranty... 2 Subsequent Transaction... 2 PURPOSE OF AMENDMENTS... 3 DESCRIPTION OF THE AMENDMENTS... 4 Amended Receivables Purchase Agreement... 4 Amended Indenture... 4 Amended Prepaid Natural Gas Sales Agreements... 6 Custodial Agreement and Amended Commodity Swaps... 7 J. Aron Investment Agreement... 9 Amended Goldman Sachs Guaranty... 9 AVAILABILITY OF INFORMATION... 9 RISK FACTORS RELATING TO THE AMENDMENTS... 9 Elimination of Seller Default Trigger... 9 J. Aron Investment Agreement Replacement Commodity Swap Counterparty Ratings Other Relationships THE CONSENT SOLICITATION Requirement for Consent Requisite Consents Relevant Record Date Expiration Date; Extensions; Amendments Consent Procedures No Revocation of Consents Conditions to the Consents Consequences of Requisite Consents Retail Processing Fee Solicitation Agent and Information and Tabulation Agent Fees and Expenses RELATIONSHIP AMONG THE PARTIES CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS MISCELLANEOUS ANNEX I FORM OF AMENDED INDENTURE... I-1 ANNEX II FORM OF AMENDED PREPAID NATURAL GAS SALES AGREEMENT... II-1 ANNEX III FORM OF AMENDED RECEIVABLES PURCHASE AGREEMENT... III-1 ANNEX IV FORM OF AMENDMENT TO GOLDMAN SACHS GUARANTY... IV-1 Page - iii -

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5 CONSENT SOLICITATION STATEMENT The Southern California Public Power Authority ( SCPPA ) is issuing this Consent Solicitation Statement and an accompanying Consent Form (collectively, the Consent Solicitation ) in order to seek consent to amendments (the Amendments ) to transaction documents that support payment of its Gas Project Revenue Bonds, Series 2007A and 2007B (the Bonds ). SCPPA is a joint powers agency established pursuant to Title 1, Division 7, Chapter 5 of the Government Code, as amended (the Act ), of the State of California (the State ). For SCPPA s contact information, see the back cover. Purpose of Existing Transactions BACKGROUND SCPPA issued the Bonds in 2007 to finance the purchase of a long-term gas supply for five of its members the Cities of Anaheim, Burbank, Colton, Glendale, and Pasadena, California (collectively, the Project Participants ). The terms of the Bonds (and the documents providing for payment of and securing the Bonds) are described in SCPPA s Official Statement dated October 3, 2007, relating to the Bonds (the Official Statement ). All descriptions of the Bonds and such documents herein are qualified in their entirety to more complete descriptions in the Official Statement. See Availability of Information herein. Gas Contracts SCPPA applied proceeds of the Bonds to prepay for a fixed quantity of natural gas to be delivered by J. Aron & Company ( J. Aron ) over approximately 30 years beginning July 1, 2008, under five Prepaid Natural Gas Sales Agreements (the Prepaid Natural Gas Sales Agreements ) between J. Aron and SCPPA, each relating to a separate Project Participant. The payment obligations of J. Aron under the Prepaid Natural Gas Sales Agreements are guaranteed by The Goldman Sachs Group ( GSG ). SCPPA also entered into separate Prepaid Natural Gas Program Gas Supply Agreements (Project 1) (the Gas Supply Contracts ) with each of the Project Participants. Each Gas Supply Contract provides for the sale to the Project Participant, at a discount from monthly index prices payable on a pay-as-you-go basis, of all of the natural gas delivered to SCPPA for such Project Participant over the term of the corresponding Prepaid Natural Gas Sales Agreement. Various termination events are specified in the Prepaid Natural Gas Sales Agreements. Upon the occurrence of certain events, a Prepaid Natural Gas Sales Agreement may be terminated by SCPPA or J. Aron. The Prepaid Natural Gas Sales Agreements will terminate automatically if J. Aron or GSG dissolves, files for bankruptcy, or undertakes certain similar acts. If a Prepaid Natural Gas Sales Agreement is terminated, J. Aron will be required to pay a scheduled termination payment to SCPPA. As currently in effect, the Prepaid Natural Gas Sales Agreements may be terminated by SCPPA if GSG is no longer rated at least BBB- or Baa3 by at least one of Standard & Poor s Ratings Group ( S&P ) or Moody s Investors Service, Inc. ( Moody s ) and J. Aron fails to deliver credit support on demand by SCPPA. Commodity Price Swaps SCPPA entered into a separate natural gas commodity price swap transaction for the gas to be sold to each Project Participant (each an Authority Commodity Swap ) with AIG-FP Broadgate Limited (the current Commodity Swap Counterparty ). Under the transactions, over the term of the Prepaid Natural Gas Sales Agreements, on a monthly net settlement basis, SCPPA must pay a floating price and will receive a fixed price for the quantities of gas to be delivered to SCPPA and sold by it under the applicable Gas Supply Contract. The floating price is equal to the market index used to calculate the price payable by each Project Participant for gas delivered under its Gas Supply Contract. The net payment obligations of the current Commodity Swap Counterparty are guaranteed by the American International Group, Inc. ( AIG ). 1

6 J. Aron entered into a mirror commodity price swap transaction for the gas to be sold to each Project Participant (each a J. Aron Commodity Swap and, together with the Authority Commodity Swaps, the Commodity Swaps ) with the current Commodity Swap Counterparty. J. Aron s net payment obligations to the Commodity Swap Counterparty are guaranteed by GSG. Receivables Purchase Agreement Under a Receivables Purchase Agreement (the Receivables Purchase Agreement ) among the Trustee, J. Aron and SCPPA, if (i) a Prepaid Natural Gas Sales Agreement is terminated early or expires and the funds available to SCPPA and the Trustee are insufficient to pay the redemption price for the Bonds to be redeemed on account of the termination or the maturing principal of and interest on the Bonds, respectively, and (ii) a deficiency exists in certain accounts under the Indenture with respect to the applicable Project Participant, then the Trustee has the right to put to J. Aron, and J. Aron must purchase, subject to certain conditions, sufficient receivables of SCPPA from the Project Participant to enable SCPPA and the Trustee to pay the redemption price or maturing debt service, as applicable. Debt Service and Debt Service Reserve Accounts The Indenture establishes a Debt Service Account and a Debt Service Reserve Account with the Trustee, each comprised of a separate subaccount for each Project Participant. Each subaccount in the Debt Service Reserve Account must be applied upon a failure of the applicable Project Participant to pay amounts due to SCPPA under its Gas Supply Contract. On the date of issuance of the Bonds, SCPPA deposited in each Project Participant subaccount in the Debt Service Reserve Account a Debt Service Reserve Surety Bond ( Surety Bond ) issued by MBIA Insurance Corporation in the amount of the Project Participant s allocable share of the approximately $19 million Debt Service Reserve Requirement. MBIA subsequently assigned its obligations under the Surety Bonds to National Public Finance Guarantee Corp. ( NPFG ). Each subaccount in the Debt Service Account is credited with monthly payments by or for the account of the applicable Project Participant and used to accrue and pay its share of (a) net payments due quarterly on an interest rate swap transaction (the Interest Rate Swap ) entered into by SCPPA with J. Aron (and guaranteed by GSG) to hedge the rate of interest on the index rate Series 2007B Bonds and (b) debt service on the Bonds (semiannually on the fixed rate Series 2007A Bonds and quarterly on the Series 2007B Bonds), net of receipts under the Interest Rate Swap. The balances of the Debt Service Account and a Working Capital Account are presently invested under a collateralized guaranteed investment agreement (the AGL Investment Agreement ) with American Life Insurance Company ( AGL ) until used to make debt service and interest rate swap payments. The balances were originally invested under a contract with AIG Matched Funding Corp. (guaranteed as to payment by American International Group, Inc.), but assigned by it to AGL in 2011 after a downgrade in the rating assigned to American International Group, Inc. resulted in SCPPA s right to terminate and replace the contract unless assigned. Goldman Sachs Guaranty Under a guaranty agreement (the Goldman Sachs Guaranty ), The Goldman Sachs Group, Inc. guaranteed payment by J. Aron of its obligations under the Prepaid Natural Gas Sales Agreements, the Receivables Purchase Agreement, and an interest rate swap agreement (the Interest Rate Swap ) that hedges the rate on interest payable by SCPPA on the Series 2007B Bonds. Subsequent Transaction In October 2009, SCPPA acquired $165,450,000 principal amount of Series 2007B Bonds from J. Aron and tendered to the Trustee for cancelation, and SCPPA, J. Aron, and the Project Participants agreed to reduce the quantities of gas to be delivered under the Prepaid Natural Gas Sales Agreements and Gas Supply Contracts and the notional amounts of the Commodity Swaps and the Interest Rate Swap. SCPPA filed a notice of such transaction with EMMA. See Availability of Information herein. 2

7 PURPOSE OF AMENDMENTS The credit ratings assigned to the Bonds by Moody s and Fitch Ratings ( Fitch ) have declined, and those assigned to the Bonds by S&P have fluctuated (as recently as May 20, 2013, the Bonds were rated BB ), as indicated by ratings reports issued by the three rating agencies. As of the date hereof, the credit ratings assigned to the Bonds by Moody s. S&P, and Fitch are Baa1, A-, and BBB+, respectively. One of the conditions to the Amendments becoming operative is that the Bonds must receive ratings of at least A3, A-, and A- from Moody s, S&P, and Fitch, respectively. The Amendments are intended to mitigate SCPPA s and the bondholders credit exposure to the replacement Commodity Swap Counterparty and NPFG in the event any of three Project Participants (the Cities of Burbank, Colton, and Pasadena, California collectively the Specified Project Participants ) fails to make payments due under its Gas Supply Contract. The Amendments contemplate the following: Novating the Commodity Swaps from the Commodity Swap Counterparty and its guarantor to Mitsubishi UFJ Securities International plc. (the Replacement Commodity Swap Counterparty ); Mitigating SCPPA s credit exposure to the Replacement Commodity Swap Counterparty through (i) a custodial arrangement effected by a Custodial Agreement (the Custodial Agreement ) among the Replacement Commodity Swap Counterparty, J. Aron, the Trustee, and U.S. Bank National Association, as custodian (the Custodian ) in order to administer payments due to and from J. Aron under the J. Aron Commodity Swaps, (ii) certain amendments to the Prepaid Natural Gas Sales Agreements related to commodity swap-based termination events, and (iii) corresponding amendments to the Commodity Swaps; Providing additional credit support in the event a Specified Project Participant fails to make a payment under its Gas Supply Contracts (and NPFG fails to perform on the applicable Surety Bond) by amending the Receivables Purchase Agreement; and Replacing the Debt Service Account portion of the AGL Investment Agreement with an uncollateralized investment agreement (the J. Aron Investment Agreement ) provided by J. Aron (and guaranteed by GSG) at substantially the same interest rate. To secure agreement by J. Aron and GSG to the Amendments, the Prepaid Natural Gas Sales Agreements will also be amended to eliminate Section 17.1(e), which currently provides that, if GSG fails to maintain a credit rating of BBB- or higher by S&P or Baa3 or higher by Moody s, SCPPA may demand that J. Aron post credit support in accordance with the Prepaid Natural Gas Sales Agreements. A failure to post credit support in response to such a demand by SCPPA is a Seller Default (as defined in the Prepaid Natural Gas Sales Agreements), permitting SCPPA to terminate the Gas Supply Agreements and redeem the Bonds with termination payments due from J. Aron. The Amendments would eliminate this Seller Default, removing SCPPA s option to terminate the Prepaid Natural Gas Sales Agreements if GSG s credit rating were to fall below BBB- by S&P or Baa3 by Moody s and J. Aron did not provide eligible credit support on demand. J. Aron informed SCPPA that it accounts for its obligation to deliver natural gas to SCPPA under the Prepaid Natural Gas Sales Agreements at fair value, and that the fair value of this obligation is impacted by many factors, including the likelihood of a termination event. Therefore, to eliminate the need for J. Aron to make a payment or provide collateral upon a downgrade of GSG s ratings below investment grade, J. Aron presented the concept of the Amendments to SCPPA. 3

8 DESCRIPTION OF THE AMENDMENTS The Amendments are proposed as a whole. A consenting bondholder must consent to the Amendments in their entirety or not at all. Amended Receivables Purchase Agreement General. The Receivables Purchase Agreement is to be amended and restated to add certain features. Pursuant to the Receivables Purchase Agreement as amended (the Amended Receivables Purchase Agreement ) and under certain circumstances: J. Aron will agree to purchase from the Trustee receivables owed by Specified Project Participants under their Gas Supply Contracts to the extent funds available in the Trust Estate to cover debt service are insufficient, which debt service deficiency would arise if NPFG failed to pay amounts due under the applicable Surety Bond. J. Aron will agree to purchase from the Trustee receivables owed by Specified Project Participants under their Gas Supply Contracts to the extent funds available in the Trust Estate to pay amounts due to the Replacement Commodity Swap Counterparty are insufficient. J. Aron will not be required to purchase such receivables, however, if the amended Prepaid Natural Gas Sales Agreement applicable to the Specified Project Participant is terminated (or notice of termination thereof is given) prior to the date payment for such receivables is due under the Amended Receivables Purchase Agreement. J. Aron will have the option (but not the obligation) to purchase from the Trustee receivables owed by Project Participants (other than Specified Project Participants) under the Gas Supply Contracts to the extent funds available in the Trust Estate to pay amounts due to the Replacement Commodity Swap Counterparty are insufficient. Purchase Price. The purchase price payable for any receivables sold to J. Aron by the Trustee will be equal to 100% of the face amount of the receivables owed by the relevant Project Participant. Repurchase. The Trustee will have the right under the Amended Receivables Purchase Agreement to repurchase receivables previously sold to J. Aron. Under the amended Indenture, the Trustee is required to make such repurchases to the extent of available funds in accounts allocable to the applicable Project Participant after making all other monthly transfers but prior to making transfers to the General Fund. Interest. SCPPA will pay J. Aron accrued interest on the balance of Put Receivables owed by a Project Participant solely from amounts on account in the General Fund attributable to the Project Participant. Enforcement of Remedies. J. Aron will have the right to pursue payment from a Project Participant and to enforce any remedies available against the Project Participant so long as amounts are owed by such Project Participant under the Amended Receivables Purchase Agreement. A complete copy of the Amended Receivables Purchase Agreement, marked to highlight all changes as a result of the Amendments, is attached hereto as Annex III. It includes Amendments not described in this section. Amended Indenture Prior Amendments. The Indenture has been previously amended by a First Supplemental Indenture, dated as of October 1, 2009 (the First Supplemental Indenture ) between SCPPA and the Trustee. The First Supplemental Indenture was entered into in connection with the transaction described under Background Subsequent Transaction herein. Schedules II and IV of the amended Indenture included in Annex I hereto reflect such transactions. 4

9 Amendments to Accommodate Amended Receivables Purchase Agreement. The Indenture is to be amended as follows (as amended, the Amended Indenture ) in order to accommodate the Amended Receivables Purchase Agreement in the flow of funds under the Indenture (with terms not defined in this Consent Solicitation Statement having the meanings assigned to them in the Amended Indenture): Section 5.04(b) will be moved to Section 5.03(j) and amended to provide that, in the event the amount available in the account and subaccount in the Operating Fund and Working Capital Account attributable to a Specified Project Participant is insufficient to pay any portion of the next succeeding Commodity Swap Payment attributable to the Specified Project Participant, the Trustee will deliver to J. Aron a Put Option Notice. Funds received from J. Aron pursuant to this provision will be deposited in the subaccount for the applicable Specified Project Participant in the Commodity Swaps Operating Account. Section 5.05(b) and Section 5.10 will be amended to provide that, before funds from the Revenue Fund related to a Project Participant are transferred to the account in the General Fund for that Project Participant, such funds must be used first to repurchase any Identified Receivables of the Project Participant from J. Aron and then to pay to J. Aron all RPA Accrued Interest attributable to that Project Participant s Receivables under the Amended Receivables Purchase Agreement. A new Section 5.09(d) will be added to the Indenture to provide that, if NPFG fails to pay any amount due under its Surety Bond related to a Specified Project Participant payment failure, the Trustee will sell Receivables payable by that Specified Project Participant to J. Aron pursuant to the Amended Receivables Purchase Agreement. Other Amendments. The Indenture will also to be amended to insert the following provisions: The lead-in clause of the first sentence in the definition of Qualified Investments will be amended and restated to read as follows: Qualified Investments means any of the following investments, if and to the extent that the same are at the time legal investments of SCPPA s funds and at the time of investment are rated (or are issued or guaranteed by an entity rated), except for (c) below [CDs with banks with the highest short-term ratings], in one of the three highest Rating Categories for long-term investments for each Rating Agency rating the Bonds: Section 2.03 will be amended to provide that SCPPA may not declare an early termination of an Authority Commodity Swap unless either (a) it enters into a replacement Commodity Swap that is effective as of the early termination date or (b) the corresponding Prepaid Natural Gas Sales Agreement will terminate as of the early termination date. SCPPA may not replace a Commodity Swap unless (i) SCPPA receives a Rating Confirmation, (ii) the replacement Commodity Swap is rated at least as highly as the ratings assigned to the Bonds or (iii) the replacement Commodity Swap Counterparty provides such collateral and security arrangements as SCPPA determines to be necessary to avoid a reduction in the ratings assigned to the Bonds. SCPPA will terminate the Authority Commodity Swaps at any time SCPPA or the Trustee has received six consecutive monthly payments from the Custodian instead of directly from the Commodity Swap Counterparty. A new Section 5.03(i) will be added to the Indenture to provide mechanics that effectuate the Call Receivables Offer described under the third bullet under Amended Receivables Purchase Agreement General above. Section 7.11(c) will be amended to include the Amended Receivables Purchase Agreement as an agreement which SCPPA covenants to enforce and perform its obligations under. A new Section 7.19 will be added pursuant to which SCPPA will covenant that it will not consent to any assignment of the Amended Goldman Sachs Guaranty without obtaining a Rating Confirmation. 5

10 Section 7.19 is in addition to, and does not override, any other provision of the Indenture or any other document relating to the replacement of the issuer of the Goldman Sachs Guaranty. Section 8.01 will be amended to provide that acceleration of the Bonds for events of default will require the consent of 100% of the bondholders, other than with respect to a failure to pay debt service as described in Section 8.01(a), (b), or (f) of the Indenture. A complete copy of the Amended Indenture, marked to highlight changes as a result of the Amendments, is attached hereto as Annex I. It includes Amendments not described in this section. Amended Prepaid Natural Gas Sales Agreements Amendments to Remove Termination for Ratings Downgrade. To remove SCPPA s right to terminate the Prepaid Natural Gas Sales Agreements if GSG fails to maintain a credit rating of BBB- or higher by S&P and fails to maintain a rating of Baa3 or higher by Moody s and, in either case, then fails to deliver credit support on demand by SCPPA, the Prepaid Natural Gas Sales Agreements will be amended as follows: Section 17.1(e) will be deleted as a Seller Default. The current Seller Default under Section 17.1(e) of the Prepaid Natural Gas Sales Agreement is as follows: the failure of The Goldman Sachs Group, Inc. to have a credit rating of BBB- or higher by S&P or Baa3 or higher by Moody s, unless, within five (5) Business Days after Buyer s demand related thereto, Seller provides Alternative Credit Support in accordance with the provisions of Exhibit D hereto. Exhibit D, which controls the provision of alternative credit support in the event of a GSG downgrade, will be deleted. Section 17.1(f), which provides a Seller Default if J. Aron has provided but ceases adequately to maintain Alternative Credit Support under Exhibit D, will be deleted. Other Amendments. In connection with the replacement Commodity Swaps and the amendments to the Receivables Purchase Agreement, the Prepaid Natural Gas Sales Agreements will be amended as follows: A new Section 17.2(d) will be added as a Buyer Default to allow J. Aron to terminate a Prepaid Natural Gas Sales Agreement if SCPPA fails to pay amounts due under the related Authority Commodity Swap, notwithstanding any available cure period. The timing of Buyer Non-Default Termination Events and Seller Non-Default Termination Events in Sections 17.3(a) and (b) will be clarified. A new Section 17.3(a)(v) will be added to provide that a payment default by J. Aron under the Amended Receivables Purchase Agreement or the J. Aron Investment Agreement will be a Buyer Non- Default Termination Event, and any termination of the Prepaid Natural Gas Sales Agreements under that section at the election of SCPPA will result in an Additional Termination Payment becoming payable by J. Aron to SCPPA. A new Section 17.3(b)(ix) will be added to allow SCPPA to terminate a Prepaid Natural Gas Sales Agreement if J. Aron does not elect to exercise its call option on applicable Project Participant receivables offered under the Amended Receivables Purchase Agreement. The period of time under which J. Aron and SCPPA may replace Commodity Swaps to avoid the termination of a Prepaid Natural Gas Sales Agreement will be modified to begin upon notice of possible termination of a Commodity Swap and end upon actual termination of a Commodity Swap. J. Aron may elect to extend this swap replacement period up to 45 days in the event a Commodity Swap is terminated due to an insolvency event of the Replacement Commodity Swap Counterparty, 6

11 provided that J. Aron will be responsible for payments that would have become due from the Replacement Commodity Swap Counterparty to SCPPA during such extended period. Section 17.4 will be amended to specify that, if J. Aron designates an early termination of the amended Prepaid Natural Gas Sales Agreement based upon a default by SCPPA under new Section 17.2(d), a conditional early termination date must first be designated at least 45 days after notice, and early termination will only become effective if SCPPA has not cured its payment default by such conditional early termination date. A new Section 17.4(j) will be added to provide for automatic termination upon the occurrence of certain specified non-default termination events resulting from (i) the termination of a Seller Swap that is not replaced during the applicable Swap Replacement Period or (ii) the termination of an Interest Rate Swap. Termination of a Prepaid Natural Gas Sales Agreement will occur automatically upon termination of the related J. Aron Commodity Swap for any reason other than non-payment or a credit support default by J. Aron under the J. Aron Commodity Swap. Section 17.5 will be amended to define the applicable Swap Replacement Periods and to specify that SCPPA will not designate an early termination of the Authority Commodity Swap based on a payment failure by the Replacement Commodity Swap Counterparty until such payment failure has continued for more than 90 consecutive days, so long as during such 90-day period SCPPA is receiving payments due thereunder from the custodian under the Custodial Agreement. A complete copy of the form of Amended Prepaid Natural Gas Sales Agreement, marked to highlight changes as a result of the Amendments, is attached hereto as Annex II. It includes Amendments not described in this section. Custodial Agreement and Amended Commodity Swaps Commodity Swap Amendments. In connection with the replacement of AIG-FP Broadgate Limited as the counterparty to the Authority Commodity Swaps and the corresponding J. Aron Commodity Swaps with the Replacement Commodity Swap Counterparty, SCPPA and J. Aron each will enter into new Authority Commodity Swaps and J. Aron Commodity Swaps, respectively, with the Replacement Commodity Swap Counterparty on terms substantially similar to the original Authority Commodity Swaps and J. Aron Commodity Swaps, but including the following changes. Authority Commodity Swaps: The Authority Commodity Swaps will be amended to clarify that any payment made by the custodian under the Custodial Agreement to SCPPA will not be deemed to cure or remedy the Replacement Commodity Swap Counterparty s failure to make a payment to SCPPA when due under the Authority Commodity Swaps. The existing 45 day cure period related to payment defaults under the Authority Commodity Swaps will be amended so that it applies to only SCPPA s payment defaults, and the cure period related to a payment default by the Replacement Swap Counterparty will be reduced to three business days. The Authority Commodity Swaps will include an optional termination right exercisable by the Replacement Swap Counterparty if SCPPA fails promptly to exercise its right to suspend all gas deliveries under a Gas Supply Contract to any Project Participant that fails to pay when due any amounts owed to SCPPA thereunder. The Authority Commodity Swap will include an event of default related to either party s failure to comply with or perform any agreement or obligation under the Authority Commodity Swap (other than 7

12 payment obligations), provided that the non-defaulting party will be entitled to seek only equitable remedies and will not be entitled to terminate the Authority Commodity Swap as a result of such event of default. Section 5(a)(vi) of the Authority Commodity Swaps, which relates to any payment default by the Replacement Commodity Swap Counterparty or default by the Replacement Commodity Swap Counterparty that results in acceleration of indebtedness under any indebtedness, will be amended to allow for administrative and similar defaults, so long as the Replacement Commodity Swap Counterparty makes the applicable payment within two business days of its receipt of notice of failure to pay. Section 5(a)(viii) of the Authority Commodity Swaps, which relates to a party s participation in a merger or similar business combination where the surviving entity does not assume the obligations under the Authority Commodity Swaps, will be amended to add that it will also be an event of default by SCPPA if it participates in such a business combination and the Trust Estate is no longer available for the satisfaction of such surviving entity's obligations to the Replacement Commodity Swap Counterparty under the Authority Commodity Swap. J. Aron Commodity Swaps: The J. Aron Commodity Swaps will be amended to provide that all payments due under the Authority Commodity Swaps will be made in accordance with the Custodial Agreement. All Commodity Swaps: All Commodity Swaps will be amended to revise the notice period for most events of default and termination events from a maximum of 20 days to a minimum of 45 days. The existing additional termination event in each of the Commodity Swaps related to a termination of any Prepaid Natural Gas Sales Agreement will be amended to provide that the termination of any Prepaid Natural Gas Sales Agreement will result in the automatic termination of both the related Authority Commodity Swap and the related J. Aron Commodity Swap. All Commodity Swaps will include an optional termination event for SCPPA s benefit if the Replacement Commodity Swap Counterparty either ceases to maintain its center of main interest in England or maintains certain establishments outside England. An existing optional termination event in each of the Commodity Swaps (related to the Commodity Swap Counterparty s failure to provide adequate assurances of performance and a rating confirmation following a ratings downgrade of the Commodity Swap Counterparty to below A2 by Moody s or below A by S&P) will be replaced with an optional termination event following a rating downgrade of the Replacement Commodity Swap Counterparty or its parent entity below Baa3 by Moody s or below BBB- by S&P. Custodial Agreement. The Custodial Agreement contains provisions designed to mitigate risks to bondholders resulting from a failure of the Replacement Commodity Swap Counterparty to make payments to SCPPA under the Authority Commodity Swaps. Pursuant to the amendments to the J. Aron Commodity Swaps described below, net payments required to be made by the Replacement Commodity Swap Counterparty or J. Aron under the J. Aron Commodity Swaps will be made to the respective custodial account of such party maintained by the Custodian under the Custodial Agreement. Under the terms of the Custodial Agreement, any net payments required to be made by J. Aron to the Replacement Commodity Swap Counterparty under the J. Aron Commodity Swaps will not be released to the Replacement Commodity Swap Counterparty until the Custodian has confirmation that the amounts payable to SCPPA by the Replacement Commodity Swap Counterparty under the Authority Commodity Swaps for such month have been paid. If the Replacement Commodity Swap Counterparty does not make a required payment under a Authority Commodity Swap and such payment remains unpaid after the expiration 8

13 of any grace period, the Custodian will pay the amount that J. Aron paid under the related J. Aron Commodity Swap to SCPPA for deposit in the Revenue Fund, and that payment will be treated as a Commodity Swap Receipt (as defined in the Amended Indenture). J. Aron Investment Agreement SCPPA and AGL will enter into an amendment with respect to the AGL Investment Agreement to eliminate the investment of the Debt Service Account in exchange for AGL making a payment to SCPPA. AGL will remain obligated on the AGL Investment Agreement for investment of the Working Capital Account. At the same time, SCPPA will enter into an investment agreement with J. Aron for the funds in the Debt Service Account (the J. Aron Investment Agreement ). The J. Aron Investment Agreement will pay the same interest rate on funds deposited in the Debt Service Account as the interest rate the AGL Investment Agreement provided on funds deposited in the Debt Service Account. Amended Goldman Sachs Guaranty The existing Goldman Sachs Guaranty will be amended (as amended, the Amended Goldman Sachs Guaranty ) to reconfirm coverage of J. Aron s payment obligations under the Amended Receivables Purchase Agreement and the Amended Prepaid Natural Gas Sales Agreements as obligations guaranteed by GSG and the waiver by GSG of additional defenses related thereto. Additionally, the Amended Goldman Sachs Guaranty will guaranty J. Aron s obligations under the J. Aron Investment Agreement. The form of the Amendment to the Goldman Sachs Guaranty, marked to highlight changes to Exhibit A to the Goldman Sachs Guaranty, is attached hereto as Annex IV. AVAILABILITY OF INFORMATION SCPPA has filed certain documents with the Electronic Municipal Market Access system ( EMMA ) of the Municipal Securities Rulemaking Board pursuant to the Continuing Disclosure Undertaking of SCPPA, dated October 11, 2007, entered into in connection with the initial offering of the Bonds, including a notice of the 2009 transaction described under Background Subsequent Transaction herein. SCPPA has also filed with EMMA this Consent Solicitation Statement and the Official Statement related to the Bonds, dated October 3, The Official Statement has not been updated since the date of issuance of the Bonds and does not reflect the 2009 transaction. Bondholders may view such filings with EMMA on the internet at No such information is incorporated by reference in or otherwise constitutes a part of the Consent Solicitation Statement. Neither SCPPA nor the Project Participants make any representation as to the accuracy or completeness of any information filed by them with EMMA, or that any such information is indicative of their current or future financial position, or as to the creditworthiness of GSG or any other party described herein. Elimination of Seller Default Trigger RISK FACTORS RELATING TO THE AMENDMENTS The elimination of Section 17.1(e) of the Prepaid Natural Gas Sales Agreements (described above) may have a negative impact on the credit rating of the Bonds if GSG were to be downgraded below investment grade by either S&P or Moody s. While a rating increase on the Bonds to at least A3 from Moody s and A- from Fitch is a condition to the effectiveness of the Amendments, there can be no assurance that such higher ratings may not be reduced or withdrawn in the future, and the future ratings could be reduced below the current credit ratings. Eliminating the Seller Default event tied to GSG s credit rating falling below investment grade could result in bondholders suffering greater losses in the event of a reduction or withdrawal of GSG s credit ratings below investment grade and a subsequent J. Aron payment default or a J. Aron or GSG bankruptcy. 9

14 J. Aron Investment Agreement The amendment of the AGL Investment Agreement to eliminate the Debt Service Account and then entering into the J. Aron Investment Agreement (guaranteed by GSG) has the effect of increasing bondholders credit exposure to J. Aron and GSG at the expense of the current security. Such a change could result in bondholders suffering greater losses in the event of a GSG default or bankruptcy. Replacement Commodity Swap Counterparty Although the Custodial Agreement is intended to divorce the credit of the Replacement Commodity Swap Counterparty from the ratings assigned to the Bonds, a termination of any Commodity Swap due to a default or other credit event on the part of the Replacement Commodity Swap Counterparty could result in early termination of the Prepaid Natural Gas Sales Agreements and mandatory redemption of the Bonds, if the Commodity Swaps are not timely replaced by ones with a substitute Commodity Swap Counterparty. If the Replacement Commodity Swaps are terminated, there can be no assurance that SCPPA and J. Aron will be able to obtain and timely enter into replacement Commodity Swaps. In that event, Termination Payments due from J. Aron, together with amounts scheduled to be on deposit in certain funds and accounts under the Amended Indenture and amounts due to the Trustee under the Amended Receivables Purchase Agreement, have been calculated to provide a sum sufficient to pay the redemption price of the Bonds. However, in that event, then current market conditions may not enable bondholders to replace their investments at or above the yield of the Bonds. Ratings Ratings of GSG. Although the Amendments will not become effective unless the Bonds are assigned minimum credit ratings of A3 by Moody s, A- by S&P and A by Fitch (the ratings currently assigned to obligations of GSG), there is no assurance that, as a result of the Amendments, any such rating on the Bonds will be maintained following the effective date of the Amendments. Following the effective date of the Amendments, the rating analysis of the Bonds may be more heavily reliant on GSG, which could negatively affect the bondholders if GSG s credit were to weaken. Ratings of Other Parties. A change by Moody s, S&P or Fitch in the credit rating of GSG, AGL (as obligor on investments of the Working Capital Account), or a Project Participant other than the Specified Project Participants (i.e., the Cities of Anaheim and Glendale, California) may impact the credit rating of the Bonds in the future. In addition, although the credit ratings of these parties may not change, a change in the methodology or policy of a rating agency could result in a change in credit ratings on the Bonds. Other Relationships J. Aron & Company, Goldman, Sachs & Co. and GSG have and will have multiple roles in the transactions relating to the Bonds, including as gas supplier, underwriter for the initial offering of the Bonds, Interest Rate Swap counterparty, and provider of the Receivables Purchase Agreement, the Custodial Agreement, the J. Aron Investment Agreement, and the Amended Receivables Purchase Agreement. Some of these affiliates stand to benefit if the Consent Solicitation is successful. Further, a ratings upgrade on the Bonds may have a positive impact on the trading prices of the Bonds, of which a subsidiary of GSG held $15,300,000 in principal amount as of July 26, The various relationships described create conflicts of interest between J. Aron and GSG on the one hand and the bondholders on the other. GSG will benefit from the elimination of the Seller Default, and the elimination of this default may adversely affect the bondholders as described under Elimination of Seller Default Trigger above. Although the credit ratings on the Bonds will improve as a condition to the effectiveness of the Amendments, following the effective date of the Amendments such credit ratings will be more heavily reliant on the credit ratings of GSG. 10

15 THE CONSENT SOLICITATION SCPPA is soliciting Consents from bondholders, upon the terms and subject to the conditions set forth in this Consent Solicitation Statement, the accompanying Consent Form, and, except as expressly set forth herein and therein, the Indenture. Pursuant to the Indenture, Consents, once given, may not be revoked. Requirement for Consent SCPPA will not enter into or approve the Amendments unless the holders of a majority in principal amount of the Bonds (excluding Bonds beneficially owned by GSG and affiliates) or their authorized proxies agree that the Amendments are in the best interests of bondholders by executing and returning Consents. Requisite Consents The registered owner of the Bonds The Depository Trust Company ( DTC ) or its authorized proxies must validly deliver Consents in respect of a majority in principal amount of the Bonds outstanding in order to approve the Amendments. As of July 26, 2013, $281,555,000 principal amount of the Series 2007A Bonds and $36,000,000 principal amount of the Series 2007B Bonds were outstanding. The failure of a registered owner or its proxy to deliver a Consent (including any failure resulting from broker non-votes) will have the same effect as if such registered owner or its proxy had voted against the Amendments. Accordingly, proxies may withhold Consents if they wish to vote against the Amendments. As of the July 26, 2013, a subsidiary of GSG owned $15,300,000 in principal amount of the Bonds. GSG has advised SCPPA that it intends to have such affiliate deliver Consents in the same proportion as those delivered by the non-gsg Holders of the Bonds, so as not to impact the direction of the vote. By way of example, if 55% of the non-gsg Holders of the Bonds deliver Consents, GSG will cause 55% of its affiliate-owned Bonds to deliver Consents. Relevant Record Date The Record Date for the purposes of this Consent Solicitation is 5:00 p.m., New York City time, on July 26, Only the DTC Participants holding positions in the Bonds at that time and their duly authorized proxies may give Consents, as described more fully under Consent Procedures below. Expiration Date; Extensions; Amendments The Consent Solicitation will expire at 5:00 p.m., New York City time, on August 23, 2013, unless terminated, shortened or extended by SCPPA. If the Consent Conditions are satisfied prior to the Expiration Date, SCPPA may consider such date of satisfaction as the Expiration Date. SCPPA expressly reserves the right to extend the Consent Solicitation at any time and from time to time by giving oral or written notice to the Solicitation Agent. For purposes of the Consent Solicitation, a notice given by SCPPA before 9:00 a.m., New York City time, on any day shall be deemed to have been made on the preceding day. Any such extension will be followed as promptly as practicable by notice thereof filed with EMMA and sent to the registered owner of the Bonds (DTC). Such announcement or notice may state that SCPPA is extending the Consent Solicitation for a specified period of time or on a daily basis. SCPPA expressly reserves the right for any reason to abandon, terminate or amend the Consent Solicitation, including increasing the Retail Processing Fee described herein, at any time prior to the Expiration Date by giving oral or written notice of such abandonment, termination or amendment to the Solicitation Agent. If the Consent Conditions are amended or the terms of the Consent Solicitation are materially and adversely changed, any Consents received by the Information and Tabulation Agent prior thereto will be voided. Any action by SCPPA to 11

16 abandon, terminate or amend the Consent Solicitation will be followed as promptly as practicable by notice thereof filed with EMMA and delivered to the registered owner of the Bonds (DTC). If the Consent Conditions are not satisfied by four weeks after the Expiration Date, the Consent Solicitation, including the Consents received to such date, will be deemed null and void. Consent Procedures In accordance with its standard procedures, DTC, which is the registered owner of all of the Bonds, will issue omnibus proxies to its Direct Participants to whose securities accounts Bonds are credited as of the Record Date (the Record Participants ), authorizing them to execute Consents for all or a portion of the amount of the Bonds then credited to their respective accounts. Only the Record Participants and their duly authorized proxies may execute and deliver a Consent Form. A beneficial owner of Bonds who is not a Record Participant (e.g., a beneficial owner whose Bonds are registered in the name of a nominee such as a bank or a brokerage firm) must arrange for its Record Participant either (a) to execute a Consent Form and deliver it to the Information and Tabulation Agent on such beneficial owner s behalf (or to such beneficial owner for forwarding to the Information and Tabulation Agent by such beneficial owner) or (b) to forward a duly executed proxy from the Record Participant authorizing the beneficial owner to execute and deliver a Consent Form with respect to the Bonds on behalf of the Record Participant. For purposes of this Consent Solicitation Statement, the Record Participants and their proxies are referred to herein as Holders. HOLDERS OF BONDS WHO WISH TO CONSENT SHOULD MAIL, HAND DELIVER, SEND BY OVERNIGHT COURIER OR FACSIMILE (CONFIRMED BY PHYSICAL DELIVERY) COMPLETED, DATED AND SIGNED CONSENT FORMS TO THE INFORMATION AND TABULATION AGENT AT THE ADDRESS SET FORTH ON THE BACK COVER PAGE HEREOF AND IN THE CONSENT FORM IN ACCORDANCE WITH THE INSTRUCTIONS SET FORTH HEREIN AND THEREIN. CONSENT FORMS SHOULD BE DELIVERED TO THE INFORMATION AND TABULATION AGENT, AND NOT TO SCPPA, THE TRUSTEE OR THE SOLICITATION AGENT. HOWEVER, SCPPA RESERVES THE RIGHT TO ACCEPT ANY CONSENT RECEIVED BY SCPPA OR THE TRUSTEE OR THE SOLICITATION AGENT. IN NO EVENT SHOULD A HOLDER DELIVER CERTIFICATES EVIDENCING BONDS. The Bonds may be issued, and therefor consents for the Bonds of any series and maturity may be given, in integral multiples of $5,000. Consents aggregating any other amount for the Bonds of a series and maturity will be counted only in the amount of the next lower integral multiple of $5,000, if any. Any Consent Forms that are properly completed, signed and delivered to the Information and Tabulation Agent by a Holder on or prior to the Expiration Date (unless otherwise extended by SCPPA) will be given effect in accordance with the terms hereof. If a Holder fails to indicate the principal amount of the Bonds for which Consent is being given, but the Consent Form is otherwise properly completed and signed, the Holder will be deemed to have Consented to the Amendments with respect to all the Bonds specified in DTC s or the Record Participant s proxy. Delivery of Consents should be made promptly in order to assure that the Information and Tabulation Agent receives the Consents prior to the Expiration Date. Consents by Holders must be executed in exactly the same name as such Holders names appear in the DTC or Record Participant proxy authorizing it to Consent. If a Consent Form is signed by a trustee, partner, executor, administrator, guardian, attorney-in-fact, officer of a corporation or other person acting in a fiduciary or representative capacity, such person must so indicate when signing and must submit with the Consent Form appropriate evidence satisfactory to SCPPA and the Trustee of authority to execute the Consent Form. In addition, if a Consent relates to less than the total principal amount of the Bonds specified in such Holder s proxy, the Holder must list the CUSIP numbers and principal amount of the Bonds to which the Consent relates. If proxies are given to owners with different names, separate Consents must be executed covering each. If a Consent Form is executed by a person other than DTC or a Record Participant, it must be accompanied by a proxy duly executed by a Record Participant. Signatures on a Consent Form may be proved by a guarantee of the signature thereon by a bank or trust company, or by the certificate of any notary public or other officer authorized to take acknowledgments of deeds, 12

17 that the Person signing such request or other instrument acknowledged to him the execution thereof, or by an affidavit of a witness of such execution duly sworn to before such notary public or other officer. Where such execution is by an officer of a corporation or association or a member of a partnership, on behalf of such corporation, association, or partnership, such signature, guarantee, certificate, or affidavit shall also constitute sufficient proof of his, her, or its authority. All questions as to the validity, form, and eligibility (including time of receipt) regarding the Consent procedures will be determined by SCPPA, which determination will be conclusive and binding. SCPPA reserves the right to reject any or all Consents that are not in proper form or the acceptance of which could in the opinion of SCPPA or its counsel be unlawful. SCPPA also reserves the right to waive any defects or irregularities in connection with the deliveries of particular Consents. Unless waived, any defects or irregularities in connection with deliveries of Consents must be cured within such time as SCPPA determines. None of SCPPA, the Project Participants, the Solicitation Agent, the Trustee, or the Information and Tabulation Agent or any other person shall be under any duty to give notification of any such defects or irregularities or waiver, nor shall any of them incur any liability for failure to give such notification. Deliveries of Consents will not be deemed to have been made until any irregularities or defects therein have been cured or waived. SCPPA s interpretations of the terms and conditions of the Consent Solicitation will be conclusive and binding. No Revocation of Consents Any Consent given shall be irrevocable and shall be binding upon the Holder of the Bonds giving such Consent and upon any subsequent registered or beneficial owner of such Bonds and of any Bonds issued in exchange therefor or upon transfer thereof (whether or not such subsequent owner has notice of such Consent). Conditions to the Consents The execution of the Amendment Documents is conditioned on (a) the Requisite Consents being validly delivered prior to the Expiration Date, (b) execution and delivery of every Amendment Document by the other parties thereto, (c) the Bonds receiving ratings of at least A3 from Moody s, A- from S&P and A- from Fitch, (d) the delivery of an opinion of Bond Counsel to the effect described under Certain U.S. Federal Income Tax Considerations herein, and (d) the delivery of opinions regarding the authorization and enforceability of the Amendment Documents. The Amendments will be effected by the Amendment Documents, which will be executed on the Consent Date or soon thereafter, if at all. The Amendments will only become effective upon the satisfaction of each of the Consent Conditions. The Requisite Consents permit, but do not require, SCPPA to give effect to the Amendments by executing and delivering the Amendment Documents. The Consent Solicitation may be abandoned or terminated by SCPPA at any time prior to the Expiration Date, for any reason, in which case Consents will be voided. If the Consent Conditions are amended or the terms of the Consent Solicitation are changed materially and adversely, any Consents therefor received by the Information and Tabulation Agent will be voided. If the Consent Conditions are not satisfied or the Amendment Documents are not executed and delivered by four weeks after the Expiration Date, the Consent Solicitation, including the Consents received to such date, will be deemed null and void. Consequences of Requisite Consents Subject to receipt of the Requisite Consents and satisfaction of the Consent Conditions, the Amendments will be effected by (i) an amendment and restatement of the Indenture, which is to be executed by SCPPA and the Trustee, (ii) an amendment and restatement of the Receivables Purchase Agreement, which is to be executed by the Trustee, SCPPA, and J. Aron, (iii) amendments and restatements of the Prepaid Natural Gas Sales Agreements, which are to be executed by SCPPA and J. Aron, (iv) an amendment to the existing Goldman Sachs Guaranty to include J. Aron s payment obligations under the amended Receivables Purchase Agreement, the amended Prepaid Natural Gas Sales Agreements, and J. Aron Investment Agreement, (v) novation to the Replacement Commodity Swap Counterparty and amendment of each of the Commodity Swaps, which are to be executed by the Commodity 13

18 Swap Counterparty, the Replacement Commodity Swap Counterparty, and, respectively, SCPPA and J. Aron, (vi) execution of the Custodial Agreement, by and among the Replacement Commodity Swap Counterparty, J. Aron, the Trustee, and U.S. Bank National Association, as Custodian, (vii) an amendment of the AGL Investment Agreement, and (viii) the entering into of the J. Aron Investment Agreement. Such agreements are referred to herein as the Amendment Documents. If the Requisite Consents are obtained, the Consent Conditions are satisfied, and the Amendments become effective, they will be binding on all Holders and their transferees, whether or not they have delivered a Consent to the Amendments. Neither SCPPA nor the other parties described herein are obligated to give effect to the Amendments even if Requisite Consents are obtained and the Consent Conditions are satisfied. Retail Processing Fee With respect to any Consent received from or for a beneficial owner of Bonds as of the Record Date with holdings in an aggregate principal amount of $250,000 or less, SCPPA will pay the relevant Retail Processing Dealer, if any, a cash payment equal to $1 per $1,000 principal amount of Bonds for which the Consent is given (the Retail Processing Fee ). Calculations of the Retail Processing Fee will be rounded up to the nearest cent. SCPPA will not be obligated to pay a Retail Processing Fee if the Consent Solicitation is terminated. SCPPA s obligation to pay a Retail Processing Fee is subject to the receipt of the Requisite Consents by SCPPA on or before the Expiration Date and the execution and delivery of the Amendment Documents. If all of the conditions set forth herein have been satisfied, SCPPA will promptly pay the Retail Processing Fees following execution of the Amendments Documents. In order for a Retail Processing Dealer to be eligible to receive the Retail Processing Fee, the Information and Tabulation Agent must receive a properly completed Consent from the Retail Processing Dealer or its customer and a properly completed Notice of Solicited Consents from the Retail Processing Dealer prior to the Expiration Date in accordance with the procedures described herein or in correspondence with the Retail Processing Dealer. SCPPA will, in its sole discretion, determine whether a broker has satisfied the criteria for receiving a Retail Processing Fee (including, without limitation, the submission of the appropriate documentation without defects or irregularities and in respect of bona fide Consents). Other than the foregoing, no fees or commissions have been or will be paid by SCPPA to any broker, dealer or other person in connection with this offer, with the exception of the Solicitation Agent and the Information and Tabulation Agent. A Retail Processing Dealer is a broker that solicited or assisted in arranging a Consent pursuant to the Consent Solicitation and either (1) a broker or dealer in securities and a member of any national securities exchange in the U.S. or the Financial Industry Regulatory Authority (FINRA) or (2) a bank or trust company located in the U.S.. Retail Processing Dealers will include any of such organizations even when its activities in connection with the Consent Solicitation consist solely of forwarding materials to customers and delivering Consents as directed by beneficial owners. Each Retail Processing Dealer must confirm, with each beneficial owner of Bonds for whom it processes Consents, that the owner has received a copy of this Consent Solicitation Statement or, concurrently with such solicitation, provide the owner with a copy of this Consent Solicitation Statement. No Retail Processing Dealer is required to make any recommendation to beneficial owners of Bonds as to whether to Consent. No assumption is made, in making payment to any Retail Processing Dealer, that its activities in connection with the Consent included any activities other than those described in this paragraph. Solicitation Agent and Information and Tabulation Agent SCPPA has retained Wells Fargo Securities, LLC as solicitation agent (the Solicitation Agent ) in connection with the Consent Solicitation. The Solicitation Agent will solicit Consents and will receive a fee for such services and reimbursement for reasonable out-of-pocket expenses. SCPPA has agreed to indemnify the Solicitation Agent against certain liabilities and expenses, including liabilities under the securities laws in connection with the Consent Solicitation. J. Aron has agreed to indemnify SCPPA against certain of the liabilities relating to information about J. Aron and its affiliates and the description of documents for which SCPPA has agreed to indemnify the Solicitation Agent. SCPPA has retained D.F. King & Co., Inc. as information and tabulation agent (the Information and Tabulation Agent ) in connection with the Consent Solicitation. Requests for additional copies of this Consent Solicitation Statement or the Consent Form may be directed to the Information and Tabulation Agent at its address 14

19 and telephone numbers set forth on the back of this Consent Solicitation Statement. The Information and Tabulation Agent will receive a customary fee for such services and reimbursement for reasonable out-of-pocket expenses. SCPPA has agreed to indemnify the Information and Tabulation Agent against certain liabilities and expenses, including liabilities under the securities laws in connection with the Consent Solicitation. The Solicitation Agent and the Information and Tabulation Agent do not assume any responsibility for the accuracy or completeness of the information contained in this Consent Solicitation Statement or any failure by SCPPA to disclose events that may have occurred and may affect the significance or accuracy of such information. Fees and Expenses J. Aron has agreed to provide funds to SCPPA to pay the costs of the Consent Solicitation, including the fees and expenses of the Solicitation Agent, the Trustee, the Information and Tabulation Agent and the financial advisor and legal counsel for SCPPA. J. Aron will also provide funds to SCPPA to pay the Retail Processing Fees and reimburse banks, trust companies, securities dealers, nominees, custodians, and fiduciaries for their reasonable expenses in forwarding Consent Forms and other materials to beneficial owners of the Bonds. From the amendments to the investment agreement with AGL and the Prepaid Natural Gas Sales Agreements with J. Aron, SCPPA anticipates realizing approximately $3.4 million above the cost reimbursement. RELATIONSHIP AMONG THE PARTIES Various affiliates of GSG have roles in the original transactions entered into in connection with the issuance of the Bonds and the Amendments. Some of these affiliates stand to benefit if the Consent Solicitation is successful. The various relationships described below could create conflicts of interest. See Risk Factors Relating to the Amendments Other Relationships for a further discussion of these conflicts. J. Aron & Company, a wholly-owned subsidiary of GSG, is the gas supplier under the Prepaid Natural Gas Sales Agreements. If the Amendments are approved, J. Aron will also be obligated to purchase Identified Receivables under the Amended Receivables Purchase Agreement. The payment obligations of J. Aron under the Prepaid Natural Gas Sales Agreements are unconditionally guaranteed by GSG under the Goldman Sachs Guaranty, and under the Amendments, the Goldman Sachs Guaranty would be amended to include J. Aron s payment obligations under the Amended Receivables Purchase Agreement and the J. Aron Investment Agreement. J. Aron is also the counterparty on the Interest Rate Swap for the term of the Series 2007B Bonds, also guaranteed by GSG. Goldman, Sachs & Co., a wholly owned subsidiary of GSG, was one of the underwriters of the initial offering of the Bonds. As of July 26, 2013, a subsidiary of GSG owned $15,300,000 principal amount of Bonds, which may have a gain in market value if the Bonds receive improved ratings. GSG has advised SCPPA that it intends to have such affiliate deliver Consents in the same proportion as those delivered by the non-gsg Holders of the Bonds, so as to not impact the direction of the vote. As of July 26, 2013, an affiliate of Wells Fargo Securities, LLC held a portion of the Bonds under management on behalf of its clients. While it holds Bonds under management, the affiliate will vote its Bonds independently in the Consent Solicitation. CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS To ensure compliance with Internal Revenue Service Circular 230, bondholders are hereby notified that any discussion of tax matters set forth in this Consent Solicitation Statement was written in connection with the promotion or marketing of the transactions or matters addressed herein and was not intended or written to be used, and cannot be used, by any person for the purpose of avoiding tax-related penalties under federal, state, or local tax law. Each bondholder is encouraged to seek advice based on its particular circumstances from an independent tax advisor. 15

20 Fulbright & Jaworski LLP, Bond Counsel to SCPPA and a member of Norton Rose Fulbright Verein, will deliver its opinion at the time the Amended Indenture is executed that the amendment of the Indenture as described herein will not, in and of itself, adversely affect the exclusion of interest on the Bonds from gross income for federal income tax purposes and will not constitute a deemed exchange of the Bonds. Accordingly, owners of Bonds will not recognize gain or loss merely as a result of the execution of the Amended Indenture. The opinion of Bond Counsel is based on an analysis of existing laws, regulations, rulings and court decisions. The statutes, regulations, rulings, and court decisions on which such opinion will be based are subject to change, possibly with retroactive effect. Such opinion may be affected by actions taken or omitted or events occurring after the date hereof. Bond Counsel has not undertaken to determine, or to inform any person, whether any such actions are taken or omitted or events do occur or any other matters come to its attention after the date hereof, and Bond Counsel disclaims any obligation to update its opinion. In rendering the foregoing opinion, Bond Counsel (i) will rely upon representations and certifications of SCPPA, the Project Participants, and J. Aron and (ii) will assume continuing compliance with certain provisions of the Amended Indenture, the Amended Prepaid Natural Gas Sales Agreements, and the Gas Supply Contracts. Bond Counsel s opinion is not a guarantee of result and is not binding on the Internal Revenue Service (the IRS ); rather, such opinion represents Bond Counsel s legal judgment based upon its review of existing law to the extent deemed relevant to render such opinion and the representations and covenants referenced above. Bondholders should note that no rulings have been, or are expected to be, sought from the IRS with respect to any of the United States federal income tax consequences discussed herein, and no assurance can be given that the IRS or a court will not take contrary positions. Except as described above, Bond Counsel will express no other opinion with respect to any other federal, state, or local tax consequences under present law, or proposed legislation, resulting from the Amendments. In particular, Bond Counsel expresses no opinion as to whether interest on the Bonds is excludable from gross income for federal income tax purposes or, except as expressly described herein, as to any other tax consequences related to the ownership or disposition of, or the accrual or receipt of interest on, the Bonds; and Bond Counsel s opinion does not constitute an affirmation of its opinion with respect to the Bonds delivered on their issuance date. MISCELLANEOUS Some of the statements included in this Consent Solicitation Statement and the documents incorporated by reference may include forward-looking statements within the meaning of federal or state securities laws. These forward-looking statements include statements concerning our plans, objectives, goals, strategies, future events, future revenue or performance, capital expenditures, financing needs, plans or intentions relating to acquisitions, business trends and other information that is not historical information. When used in this Consent Solicitation Statement and the documents incorporated herein by reference, the words estimates, expects, anticipates, projects, plans, intends, believes, forecasts, or future or conditional verbs, such as should, could or may, and variations of such words or similar expressions are intended to identify forward-looking statements. All forward-looking statements, including, without limitation, management s examination of historical operating trends and data, are based upon our current expectations and various assumptions. Our expectations, beliefs and projections are expressed in good faith and we believe there is a reasonable basis for them. However, there can be no assurance that management s expectations, beliefs, and projections will be achieved. The Consent Solicitation is not being made to, nor will Consent Forms be accepted from or on behalf of, bondholders in any jurisdiction in which the making of the Consent Solicitation or the acceptance thereof would not be in compliance with the laws of such jurisdiction. However, SCPPA may in its discretion take such action as it may deem necessary to make the Consent Solicitation in any such jurisdiction and extend the Consent Solicitation to bondholders in such jurisdiction. In any jurisdiction in which the securities laws or blue sky laws require the Consent Solicitation to be made by a licensed broker or dealer, the Consent Solicitation will be deemed to be made on behalf of SCPPA by the Solicitation Agent, or one or more registered brokers or dealers that are licensed under the laws of such jurisdiction. 16

21 The statements contained in this Consent Solicitation Statement are made as of the date hereof, and the delivery of this Consent Solicitation Statement and the accompanying materials will not, under any circumstances, create any implication that the information contained herein is correct at any time subsequent to the date hereof. Recipients of this Consent Solicitation Statement are not to construe the contents of this Consent Solicitation Statement as legal, business or tax advice. Each recipient should consult its own attorney, business advisor and tax advisor as to legal, business, tax and related matters concerning this Consent Solicitation. None of SCPPA, the Project Participants, J. Aron, GSG, the Trustee, the Information and Tabulation Agent or the Solicitation Agent makes any recommendation as to whether or not bondholders should provide Consents to the Amendments. 17

22 [This Page Intentionally Left Blank]

23 Annex I FORM OF AMENDED INDENTURE I-1

24 SUTHERLAND DRAFT (30 JULY 2013) COMPOSITE EXECUTION COPY INCORPORATING 10/1/2009 FIRST SUPPLEMENTAL INDENTURE AMENDED AND RESTATED TRUST INDENTURE BETWEEN SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY AND U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE GAS PROJECT REVENUE BONDS (PROJECT NO. 1) SERIES 2007A AND SERIES 2007B DATED AS OF OCTOBER 1[ ],

25 TABLE OF CONTENTS Page ARTICLE I DEFINITIONS AND GOVERNING LAW Section 1.01 Definitions...3 Section 1.02 Captions...18 Section 1.03 Rules of Construction...18 Section 1.04 Governing Law...18 Section 1.05 Representation by Counsel...18 ARTICLE II AUTHORIZATION AND ISSUANCE OF BONDS Section 2.01 Authorization of Bonds; Application of Proceeds...18 Section 2.02 Terms of Bonds; Payment...19 Section 2.03 Provisions Regarding Commodity Swaps...21 Section 2.04 Provisions Regarding Interest Rate Swap...23 ARTICLE III GENERAL TERMS AND PROVISIONS OF BONDS Section 3.01 Medium of Payment; Form and Date; Letters and Numbers...24 Section 3.02 Legends...25 Section 3.03 Execution and Authentication...25 Section 3.04 Exchange, Transfer and Registry...25 Section 3.05 Regulations with Respect to Exchanges and Registration of Transfers...26 Section 3.06 Bonds Mutilated, Destroyed, Stolen or Lost...26 Section 3.07 Temporary Bonds...27 Section 3.08 Payment of Interest on Bonds; Interest Rights Preserved...27 Section 3.09 Book Entry System; Appointment of Securities Depository...28 ARTICLE IV REDEMPTION OF BONDS Section 4.01 Extraordinary Redemption...29 Section 4.02 Sinking Fund Redemption...30 Section 4.03 No Optional Redemption...31 Section 4.04 Redemption Notice...31 Section 4.05 Bonds Redeemed in Part...32 Section 4.06 [Reserved.]...32 Section 4.07 Trustee Action to Effect Redemption...32 Section 4.08 Selection of Bonds to be Redeemed...32 Section 4.09 Payment of Redeemed Bonds...32 Section 4.10 Cancellation and Destruction of Bonds...33 Section 4.11 Reductions to Schedule II, Schedule IV and Sinking Fund Installments...33 ARTICLE V ESTABLISHMENT OF FUNDS AND APPLICATION THEREOF Section 5.01 The Pledge Effected by this Indenture...34 Section 5.02 Establishment of Funds and Accounts...34 Section 5.03 Project Fund...36 Section 5.04 Revenues and Revenue Fund...38 Section 5.05 Payments into Certain Funds...39 Section 5.06 Operating Fund...41 Section 5.07 Debt Service Fund Debt Service Account i-

26 TABLE OF CONTENTS (continued) Page Section 5.08 Debt Service Fund Redemption Account...44 Section 5.09 Debt Service Fund Debt Service Reserve Account...45 Section 5.10 General Fund...46 Section 5.11 Purchases of Bonds...46 ARTICLE VI DEPOSITORIES OF MONEYS, SECURITY FOR DEPOSITS AND INVESTMENT OF FUNDS Section 6.01 Depositories...47 Section 6.02 Deposits...47 Section 6.03 Investment of Certain Funds...48 Section 6.04 Valuation and Sale of Investments...49 ARTICLE VII PARTICULAR COVENANTS OF SCPPA Section 7.01 Payment of Bonds...50 Section 7.02 Extension of Payment of Bonds...50 Section 7.03 Offices for Servicing Bonds...50 Section 7.04 Further Assurance...50 Section 7.05 Power to Issue Bonds and Pledge the Trust Estate...51 Section 7.06 Power to Fix and Collect Fees and Charges for the Sale of Gas...51 Section 7.07 Creation of Liens...51 Section 7.08 Annual Budget...51 Section 7.09 Limitations on Operation and Maintenance and Other Costs...52 Section 7.10 Fees and Charges...52 Section 7.11 Gas Supply Contracts, Gas Remarketing, Gas Purchase Agreements, Commodity Swaps and, Interest Rate Swap and Receivables Purchase Agreement; Enforcement and Amendment...52 Section 7.12 Maintenance of Insurance...55 Section 7.13 Accounts and Reports...55 Section 7.14 Payment of Taxes and Charges...55 Section 7.15 Tax Covenants...56 Section 7.16 General...61 Section 7.17 Bankruptcy...61 Section 7.18 Bylaws...61 Section 7.19 Replacement of Gas Supplier Guarantee...62 ARTICLE VIII EVENTS OF DEFAULT AND REMEDIES Section 8.01 Events of Default...62 Section 8.02 Accounting and Examination of Records After Default...64 Section 8.03 Enforcement of Agreements; Application of Moneys After Default...64 Section 8.04 Appointment of Receiver...65 Section 8.05 Proceedings Brought by Trustee...65 Section 8.06 Restriction on Bondholder s Action...66 Section 8.07 Remedies Not Exclusive...66 Section 8.08 Effect of Waiver and Other Circumstances...66 Section 8.09 Notice of Default...67 ARTICLE IX CONCERNING THE FIDUCIARIES -ii-

27 TABLE OF CONTENTS (continued) Page Section 9.01 Acceptance by Trustee of Duties...67 Section 9.02 Paying Agents; Appointment and Acceptance of Duties...67 Section 9.03 Responsibilities of Fiduciaries...67 Section 9.04 Evidence on Which Fiduciaries May Act...68 Section 9.05 Compensation...68 Section 9.06 Certain Permitted Acts...69 Section 9.07 Resignation of Trustee...69 Section 9.08 Removal of the Trustee...69 Section 9.09 Appointment of Successor Trustee...69 Section 9.10 Transfer of Rights and Property to Successor Trustee...70 Section 9.11 Merger or Consolidation...70 Section 9.12 Adoption of Authentication...70 Section 9.13 Resignation or Removal of Paying Agent and Appointment of Successor...71 Section 9.14 Fiduciary s Reliance...71 Section 9.15 Fiduciary s Liability...71 Section 9.16 Fiduciary s Agents or Attorneys...71 Section 9.17 UCC Filings...71 ARTICLE X SUPPLEMENTAL INDENTURES Section Supplemental Indentures Not Requiring Consent of Bondholders...72 Section Supplemental Indentures Effective With Consent of Bondholders...73 Section General Provisions...73 ARTICLE XI AMENDMENTS Section Mailing...74 Section Powers of Amendment...74 Section Consent of Bondholders...75 Section Notifications by Unanimous Consent...76 Section Exclusion of Bonds...76 Section Notation on Bonds...76 ARTICLE XII MISCELLANEOUS Section Defeasance...76 Section Evidence of Signatures of Bondholders and Ownership of Bonds...79 Section Moneys Held for Particular Bonds...80 Section Preservation and Inspection of Documents...80 Section Parties Interested Herein...80 Section No Recourse on the Bonds...81 Section Publication of Notice; Suspension of Publication...81 Section Severability of Invalid Provisions...81 Section Holidays...81 Section Notices...81 Section Notices to Rating Agencies...82 Section Counterparts iii-

28 TABLE OF CONTENTS (continued) Page TESTIMONIUM...83 SIGNATURES...83 EXHIBIT A FORM OF BONDS...A-1 SCHEDULE I SCHEDULE OF PROJECT PARTICIPANTS... I-1 SCHEDULE II SCHEDULED DEBT SERVICE DEPOSITS...II-1 SCHEDULE III AMORTIZED VALUE...III-1 SCHEDULE IV PRINCIPAL AMOUNT BY PROJECT PARTICIPANT... IV-1 SCHEDULE V GAS ENTITLEMENT SHARES...V-1 SCHEDULE VI WORKING CAPITAL SUBACCOUNTS... VI-1 -iv-

29 This AMENDED AND RESTATED TRUST INDENTURE, dated as of October 1[ ], (this Indenture ), by and between SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY, established under the laws of the State of California, ( SCPPA ) and U.S. BANK NATIONAL ASSOCIATION, a national banking association, duly organized and existing under and by virtue of the laws of the United States of America and authorized to accept and execute trusts of the character herein set out, with a corporate trust office located at 633 West 5th Street, 24th Floor, Los Angeles, California 90071, as trustee under this Indenture (the Trustee ), W I T N E S S E T H: WHEREAS, SCPPA is authorized pursuant to the provisions of the Act to acquire supplies of natural gas by any means, to enter into agreements with respect to the acquisition of rights to the supplies of natural gas obtained, and to issue revenue bonds to finance the cost of acquisition of such supplies, and is vested with all powers necessary to accomplish the purposes for which it was created; WHEREAS, SCPPA and the Project Participants have investigated the feasibility and desirability of purchasing natural gas in order to, among other things, provide fuel for the Project Participants; gas; WHEREAS, SCPPA and the Project Participants desire to acquire a supply of natural WHEREAS, SCPPA and the Project Participants have entered into the Gas Supply Contracts pursuant to which SCPPA will sell natural gas from the Gas Project to the Project Participants; WHEREAS, SCPPA intends to financeand the Trustee have heretofore entered into a Trust Indenture, dated as of October 1, 2007, as amended by that certain Supplemental Indenture dated December 1, 2009 (collectively, the Existing Indenture ), and SCPPA has financed the Cost of Acquisition of the Gas Project through the issuance of Bonds pursuant heretoto the Existing Indenture; WHEREAS, SCPPA desires to amend and restate the Existing Indenture and to provide for the continued securing of the Bonds as provided in this Indenture; WHEREAS, the execution and delivery of this Indenture has been in all respects duly and validly authorized and approved by resolution of the Board of Directors of SCPPA; and WHEREAS, the Trustee is willing to accept the trust provided for in this Indenture; NOW, THEREFORE, THIS INDENTURE WITNESSETH, SCPPA and the Trustee agree as follows for the benefit of the other and for the benefit of the Holders of the Bonds issued pursuant hereto and the swap counterparties:

30 GRANTING CLAUSES For and in consideration of the premises, the mutual covenants of SCPPA and the Trustee and the purchase of the Bonds by the Holders thereof and in order to secure the payment of the principal of and premium, if any, and interest on the Bonds according to their tenor and effect, payment of the Interest Rate Swap Payments and Commodity Swap Payments, and the performance and observance by SCPPA of all the covenants expressed or implied herein and in the Bonds, SCPPA heretofore has conveyed, assigned and pledged, and by these presents does hereby convey, assign and pledgereconvey, reassign and repledge, unto the Trustee and unto its successors in trust, and to it and its assigns, forever all right, title and interest of SCPPA in and to the Trust Estate, subject to the provisions of this Indenture permitting the application thereof for the purposes and on the terms and conditions set forth in this Indenture, and all other rights hereinafter granted for the further securing of the Bonds, Interest Rate Swap Payments, and Commodity Swap Payments, subject to the following security interests: SCPPA has granted and hereby grants to the Trustee for the benefit first of the Commodity Swap Counterparty, as security for payment of the Commodity Swap Counterparty, SCPPA s right, title and interest to the funds and investments contained in the Working Capital Account to be applied as provided in Section 5.03(b) hereof, and subject to the assignment of certain rights by SCPPA to the Surety Provider pursuant to the Financial Guaranty Agreements; TO HAVE AND TO HOLD all the same with all privileges and appurtenances hereby and hereafter conveyed and assigned, or agreed or intended so to be, to the Trustee and its respective successors in said trust and assigns forever; IN TRUST NEVERTHELESS, upon the terms and trusts herein set forth for the equal and proportionate benefit, security and protection of all Holders of the Bonds issued pursuant to and secured by this Indenture and the Interest Rate Swap Counterparty without privilege, priority or distinction as to the lien or otherwise of any Bond over any other Bond or the payment of interest with respect to any Bond over the payment of interest with respect to any other Bond or the Interest Rate Swap Payments, except as otherwise provided herein; and PROVIDED, HOWEVER, that if SCPPA, its successors or assigns, shall well and truly pay, or cause to be paid, the principal or Redemption Price, if any, onof the Outstanding Bonds and the interest due or to become due thereon, at the times and in the manner mentioned in the Bonds, respectively, according to the true intent and meaning thereof, and the Commodity Swap Payments and the Interest Rate Swap Payments, and shall cause the payments to be made into the Funds as required hereunder, or shall provide, as permitted hereby, for the payment thereof as provided in Section 12.01, and shall well and truly keep and perform and observe all the covenants and conditions of this Indenture to be kept, performed and observed by it, and shall pay or cause to be paid to the Trustee all sums of money due or to become due to it in accordance with the terms and provisions hereof, then upon such final payments or provisions for such payments by SCPPA, the Bonds, the Commodity Swaps and the Interest Rate Swap shall cease to be entitled to any lien, benefit or security under this Indenture, and all covenants, agreements and obligations of SCPPA to the Holders of such Bonds, the Commodity Swap Counterparty, and the Interest Rate Swap Counterparty shall thereupon cease, terminate and be discharged and satisfied; otherwise this Indenture shall remain in full force and effect.; 2

31 AND IT IS HEREBY COVENANTED AND DECLARED that the Existing Indenture is hereby amended and restated to read as this Indenture, and the terms and conditions upon which the Bonds are to be issued, authenticated, delivered, secured and accepted by all Persons who from time to time shall be or become the Holders thereof, and the trusts and conditions upon which the Trust Estate, subject to the provisions of this Indenture permitting the application thereof for the purposes and on the terms and conditions set forth in this Indenture, is to be held and disposed of, which said trusts and conditions the Trustee hereby accepts, are, and the respective parties hereto covenant and agree, as follows: ARTICLE I Definitions and Governing Law Section 1.01 Definitions. The following terms shall, for all purposes of this Indenture, have the following meanings: Account or Accounts means, as the case may be, each or all of the Accounts established in Section Accountant means an independent certified public accountant or a firm of independent certified public accountants, selected by SCPPA, who may be the accountant or firm of accountants who regularly audit the books of SCPPA, or a municipal finance consultant or firm of municipal finance consultants, selected by SCPPA. Accountant s Certificate means a certificate signed by an Accountant. Act means the provisions relating to the joint exercise of powers found in Chapter 5 of Division 7 of Title 1 of the Government Code of California, as amended from time to time. Additional Termination Payment has the meaning given to such term in the Gas Purchase Agreements. Affiliate means, with respect to any party, any entity which is a direct or indirect parent or subsidiary of such party or which directly or indirectly (i) owns or controls such party, (ii) is owned or controlled by such party, or (iii) is under common ownership or control with such party. For purposes of this definition, control of an entity means the power, directly or indirectly, either to (a) vote 50% of more of the securities having ordinary voting power for the election of directors or Persons performing similar functions or (b) direct or cause the direction of the management and policies, whether by contract or otherwise. Aggregate Debt Service means, as of any date of calculation and with respect to any period, the sum of the amounts of Debt Service for all Bonds Outstanding. Amortized Value means, with respect to any Fixed Rate Bond to be redeemed, the principal amount of such Fixed Rate Bond multiplied by the price of such Fixed Rate Bond expressed as a percentage, calculated based on the industry standard method of calculating bond prices (as such industry standard prevails on the date of delivery of the Bonds), with a delivery date equal to the date of redemption, a maturity date equal to the stated maturity date of such 3

32 Fixed Rate Bond and a yield equal to such Fixed Rate Bond s original reoffering yield, which, in the case of certain dates, produces the amounts for all of the Fixed Rate Bonds set forth in Schedule III hereto. Annual Budget means the annual budget for the Gas Project, as amended or supplemented, adopted or in effect for a particular Fiscal Year as provided in Section Authorized Authority Representative means (a) the President of SCPPA, (b) the Vice President of SCPPA, (c) the Executive Director of SCPPA and (d) any other officer or employee of SCPPA (including any officer or employee of an agent appointed by SCPPA pursuant to an agency agreement to act as an agent with respect to the Gas Project) authorized to perform specific acts or duties by resolution duly adopted by SCPPA. Authorized Denominations means $5,000 and any integral multiple thereof. Authorized Newspaper means The Wall Street Journal or The Bond Buyer or any other newspaper or journal printed in the English language and customarily published on each Business Day devoted to financial news and selected by the Trustee, whose decision shall be final. Average Annual Debt Service means, as of any date of calculation, the total of the Aggregate Debt Service as computed for each Fiscal Year during which any Bonds are Outstanding, divided by the number of such Fiscal Years. Beneficial Owner means, with respect to Bonds registered in the Book-Entry System, any Person who acquires a beneficial ownership interest in a Bond held by the Securities Depository. Board means the Board of Directors of SCPPA, or if said Board shall be abolished, the board, body, commission or agency succeeding to the principal functions thereof or to whom the power and duties granted or imposed by this Indenture shall be given by law. Bond or Bonds means any of SCPPA s Fixed Rate Bonds or Index Rate Bonds. Bond Counsel means counsel of nationally recognized standing in matters pertaining to the tax-exempt status of interest on obligations issued by states and their political subdivisions, duly admitted to the practice of law before the highest court of any state of the United States, and selected by SCPPA. Bond Payment Date means each date on which (1) interest on Bonds is due and payable or (2) principal of Bonds is payable at maturity or pursuant to Sinking Fund Installments. Bond Registrar means the Trustee and any other bank or trust company organized under the laws of any state of the United States of America or national banking association appointed by SCPPA to perform the duties of Bond Registrar enumerated in Section

33 Bondholder or Holder of Bonds or Holder means any Person who shall be the registered owner of any Bond or Bonds. Book-Entry System means the system maintained by the Securities Depository and described in Section Business Day means any day other than (i) a Saturday or Sunday, (ii) a day on which commercial banks generally in New York, New York, or the city in which are located the principal corporate offices of the Trustee or the operational offices of SCPPA are authorized by law or executive order to close, (iii) a day on which the New York Stock Exchange, Inc. is closed or (iv) a day on which the payment system of the Federal Reserve System is not operational. Calculation Agent means J. Aron & Company or any successor Interest Rate Swap Counterparty, acting as Calculation Agent under the provisions of the Interest Rate Swap. Call Receivables has the meaning given to such term in the Receivables Purchase Agreement. Cede means Cede & Co., the nominee of DTC, and any successor nominee of DTC with respect to the Bonds pursuant to Section Collateral Agent means the Trustee in its capacity as Collateral Agent under the Collateral Agreement. Collateral Agreement means the Collateral Agency Agreement, dated as of October 1, 2007, between SCPPA and the Collateral Agent. Commodity Swap or Commodity Swaps means the ISDA Master Agreement, Schedule and, as applicable, each or all of the Confirmations between SCPPA and the Commodity Swap Counterparty, or any replacement agreement permitted by Section 2.03, pursuant to which SCPPA will pay to the Commodity Swap Counterparty an index-based floating price and the Commodity Swap Counterparty will pay to SCPPA a fixed price in relation to the monthly quantities of Gas to be delivered under the Gas Purchase Agreements. Commodity Swap Counterparty means, with respect to the initial Commodity Swaps, AIG-FP Broadgate LimitedMitsubishi UFJ Securities International PLC and any successor to the foregoing, or, if any such Commodity Swap is replaced pursuant to Section 2.03, the counterparty to such replacement Commodity Swap. Commodity Swap Mandatory Termination Event shall have the meaning given to such term in Section 2.03(c)(ivf). Commodity Swap Payments means, as of each scheduled payment date specified in a Commodity Swap, the amount, if any, payable to the Commodity Swap Counterparty by SCPPA. Commodity Swap Receipts means, as of each scheduled payment date specified in a Commodity Swap, the amount, if any, payable to SCPPA by the Commodity Swap Counterparty. 5

34 Commodity Swaps Operating Account means the Commodity Swaps Operating Account established in Section Computation Date for the Bonds of each issue has the meaning stated in section (b) of the Regulations and, until the Regulations are amended to provide otherwise, means (1) any day preceding the fifth anniversary of the issue date of the issue selected by SCPPA before such fifth anniversary and, if no such date is theretofore selected by SCPPA, then the day immediately preceding such fifth anniversary, (2) each fifth anniversary of the Computation Date for the Bonds of such issue described in clause (1) or, if the Bonds of such issue are a variable yield issue as defined in Section (b) of the Regulations, every anniversary of such Computation Date, as elected by SCPPA consistently throughout the term of the Bonds of such issue, and (3) the later of the final maturity of the Bonds of such issue or the date on which due provision for payment of all of the Bonds of such issue has been made. Cost of Acquisition means all costs of planning, financing, acquiring, transporting, storing and implementing the Gas Project, which shall include, but not be limited to, funds for: (a) the payment of costs and expenses incurred for or in connection with the acquisition of Gas under the Gas Purchase Agreements; (b) interest accruing in whole or in part on Bonds for such period as SCPPA may reasonably determine to be necessary in accordance with the provisions of this Indenture; (c) the payment of all premiums to the Surety Provider in order to obtain Surety Bonds to satisfy the Debt Service Reserve Requirement for the Bonds; (d) all federal, state and local taxes and payments in lieu of taxes required to be paid other than on an annual basis pursuant to the Gas Purchase Agreements; (e) all costs and expenses relating to claims or judgments arising out of the acquisition or implementation of the Gas Project; (f) the costs and expenses incurred in the issuance and sale of bonds, notes or other evidences of indebtedness from time to time issued, the proceeds of which have been or will be required to be applied to one or more purposes for which Bonds could be issued, including, without limitation, legal, accounting, engineering, consulting, financing, technical, fiscal agent and underwriting costs, fees and expenses, bond discount, rating agency fees, premiums and fees in connection with the Surety Bonds or any other security facility, and all other costs and expenses incurred in connection with the authorization, sale and issuance of the Bonds and preparation of this Indenture; (g) all other costs incurred in connection with and properly chargeable to, the acquisition or implementation of the Gas Project; and (h) the allowance for working capital requirements of SCPPA in such amounts as shall be deemed reasonably necessary by SCPPA. 6

35 Daily Contract Quantity shall have the meaning, with respect to a given Project Participant, as set forth in the applicable Gas Purchase Agreement. Debt Service means, for any particular Fiscal Year an amount equal to the sum of (a) all interest, except to the extent that such interest is to be paid from deposits into the Debt Service Account in the Debt Service Fund made from the proceeds of Bonds or other evidences of indebtedness of SCPPA (including amounts, if any, transferred thereto from the Project Fund), payable during such Fiscal Year on Bonds Outstanding, plus (b) the Principal Installments payable during such Fiscal Year on Bonds Outstanding, calculated on the assumption that Bonds Outstanding on the day of calculation cease to be Outstanding by reason of, but only by reason of, payment either upon maturity or application of any Sinking Fund Installments required by this Indenture; provided, however that for all purposes of this Indenture, principal and interest due on the first day of a Fiscal Year shall be deemed to have been payable and paid on the last day of the immediately preceding Fiscal Year; provided further, however that for purposes of computing Debt Service the interest rate on the Index Rate Bonds shall be the fixed rate of interest payable by SCPPA to the Interest Rate Swap Counterparty. Debt Service Account means the Debt Service Account in the Debt Service Fund established in Section Debt Service Fund means the Debt Service Fund established in Section Debt Service Reserve Account means the Debt Service Reserve Account in the Debt Service Fund established in Section Debt Service Reserve Requirement means (a) $19,145,000, but not to exceed in aggregate, as of any date of calculation, the least of: (1) the sum of ten percent of the original principal amount of the Bonds; (2) the Maximum Annual Debt Service on the Bonds; and (3) 125% of the Average Annual Debt Service on the Bonds; provided, however, that with respect to calculating the Debt Service Reserve Requirement, interest on the Index Rate Bonds shall be deemed to accrue at the fixed interest rate paid by SCPPA under the Interest Rate Swap, or (b) any other applicable limit imposed by the Internal Revenue Code. Defaulted Interest shall have the meaning given to such term in Section Defeasance Securities means (a) Government Obligations and (b) to the extent that such deposits or certificates of deposit are Qualified Investments, deposits in interest-bearing time deposits or certificates of deposit which shall not be subject to redemption or repayment prior to their maturity or due date other than at the option of the depositor or holder thereof or as to which an irrevocable notice of redemption or repayment, or irrevocable instructions have been given to call for redemption or repayment, of such time deposits or certificates of deposit on a specified redemption or repayment date has been given and such time deposits or certificates of 7

36 deposit are not otherwise subject to redemption or repayment prior to such specified date other than at the option of the depositor or holder thereof, and which are fully secured by Government Obligations to the extent not insured by the Federal Deposit Insurance Corporation. Depository means any bank, trust company, national banking association, savings and loan association, savings bank or other banking association selected by SCPPA as a depository of moneys and securities held under the provisions of this Indenture, and may include the Trustee. DSA Investment Agreement means that certain Investment Agreement, dated as of the date hereof, among the Gas Supplier, SCPPA and the Trustee. DSA Investment Agreement Provider means the Gas Supplier and any successor to the foregoing. DTC means The Depository Trust Company, New York, New York, and its successors and assigns. Early Termination Date has the meaning given to such term in the Gas Purchase Agreements. Early Termination Payment Date has the meaning given to such term in the Gas Purchase Agreements. Event of Default shall have the meaning given to such term in Section Extraordinary Expenses means extraordinary and nonrecurring expenses incurred by SCPPA in connection with the Gas Project, including extraordinary administration expenses to be paid pursuant to Section of the Gas Supply Contracts. Fiduciary or Fiduciaries means the Trustee, the Paying Agents, the Bond Registrar, the Collateral Agent, or any or all of them, as may be appropriate. Financial Guaranty Agreements means the Financial Guaranty Agreements dated October 1, 2007, between SCPPA and the Surety Provider. Fiscal Year means (i) the twelve (12) month period beginning on July 1 of each year and ending on the next June 30, or (ii) such other twelve (12) month period established by SCPPA from time to time, upon Written Notice of SCPPA to the Trustee, as its fiscal year. Fitch means Fitch Ratings, Inc., its successors and assigns, and, if such corporation shall no longer perform the functions of a securities rating agency, Fitch shall be deemed to refer to any other nationally recognized securities rating agency designated by SCPPA. Fixed Rate Bonds means any of SCPPA s Gas Project Revenue Bonds (Project No. 1), Series 2007A authorized by Section 2.01 hereof. 8

37 Fully Disqualified Sale shall have the meaning ascribed thereto in the Gas Purchase Agreements. Fund or Funds means, as the case may be, each or all of the Funds established in Section Gas shall havehas the meaning as set forthgiven to such term in the Gas Supply Contracts. Gas Entitlement Share or Gas Entitlement Shares means, as the case may be, with respect to a given Project Participant, such Project Participant s Daily Contract Quantity for a given calendar year compared to all Daily Contract Quantities for all Project Participants during such calendar year, as set forth in Appendix D-2 of the Gas Supply Contracts, as such Appendix D-2 may be adjusted pursuant to the Gas Supply Contracts. The Gas Entitlement Shares of the Project Participants, as of the date of issuance of the Bonds, are set forth in Schedule V. Upon any adjustment of the Daily Contract Quantities set forth in Appendix D-2 of the Gas Supply Contracts, SCPPA shall promptly provide a revised Schedule V to the Trustee for replacement of the prior Schedule V. Gas Project means SCPPA s purchase of Gas pursuant to the Gas Purchase Agreements and related contractual arrangements and agreements, the purchase of any Gas to replace Gas not delivered as required pursuant to the Gas Purchase Agreements, and the purchase of Gas by the Gas Supplier or by SCPPA to remediate a Non-Service Area Sale or a Fully Disqualified Sale made with Gas purchased pursuant to the Gas Purchase Agreements, and the resale of all such Gas pursuant to the Gas Supply Contracts or otherwise. Gas Project Account means the Gas Project Account in the Project Fund established pursuant to Section Gas Purchase Agreements mean the Amended and Restated Prepaid Natural Gas Sales Agreements dated October 3, 2007as of even date herewith, between SCPPA and the Gas Supplier, as the same may be amended from time to time. Gas Supplier means J. Aron & Company, a New York general partnership. Gas Supplier Guarantee means the Seller s Guaranty, as defined in the Gas Purchase Agreements. Gas Supply Contracts means each of the Prepaid Natural Gas Program Gas Supply Agreements (Project 1), dated October 3, 2007 for the sale by SCPPA of Gas from or attributable to the Gas Project to the Project Participants, as the same may be amended from time to time in accordance with the terms thereof and this Indenture. General Fund means the General Fund established in Section General Operating Account means the General Operating Account established in Section

38 Government Obligations means (a) Direct obligations of (including obligations issued or held in book-entry form on the books of) the Department of Treasury of the United States of America, obligations unconditionally guaranteed as to principal and interest by the United States of America, and evidences of ownership interests in such direct or unconditionally guaranteed obligations; (b) Any bonds or other obligations of any state of the United States of America or of any agency, instrumentality or local governmental unit of any such state which: (i) are not callable at the option of the obligor prior to maturity or as to which irrevocable notice has been given by the obligor to call such bonds or obligations on the date specified in the notice; (ii) are rated in the highest rating category of S&P and Moody s; and (iii) are fully secured as to principal and interest and redemption premium, if any, by a fund consisting only of cash or obligations described in clause (a) above, which fund may be applied only to the payment of interest when due, principal of and redemption premium, if any, on such bonds or other obligations on the maturity date or dates thereof or the specified redemption date or dates pursuant to such irrevocable notice, as appropriate; and (c) Any other bonds, notes or obligations of the United States of America or any agency or instrumentality thereof which, if deposited with the Trustee for the purpose described in Section 12.01(c), will result in a rating on the Bonds which are deemed to have been paid pursuant to Section 12.01(c) that is in the highest Rating Category of each Rating Agency that is then maintaining a rating on such Bonds. Gross Proceeds of the Bonds of any issue means (1) all amounts actually or constructively received from the sale of the Bonds of such issue, including amounts used to pay underwriters discount or compensation but excluding interest accrued prior to the issue date thereof, (2) all amounts actually or constructively received from investing proceeds of the Bonds of such issue, and (3) all replacement proceeds thereof, as defined in Section (c) of the Regulations. Identified Receivables has the meaning given to such term in the Receivables Purchase Agreement. Indenture means this Amended and Restated Trust Indenture as from time to time amended or supplemented by Supplemental Indentures in accordance with the terms hereof. Index Rate Bonds means any of SCPPA s Gas Project Revenue Bonds (Project No. 1), Series 2007B authorized by Section 2.01 hereof. Interest Payment Date means (i) with respect to the Fixed Rate Bonds, May 1 and November 1 of each year, commencing May 1, 2008 and (ii) with respect to the Index Rate Bonds, February 1, May 1, August 1 and November 1 of each year, commencing February 1, If the Interest Payment Date is not a Business Day, such payment may be made on the next succeeding Business Day with the same force and effect as if done on the nominal date 10

39 provided in this Indenture, and no interest shall accrue for that Interest Payment Date for the period from and after such nominal date. Interest Rate Swap means the ISDA Master Agreement, Schedule and Confirmation between SCPPA and the Interest Rate Swap Counterparty, or any replacement agreement permitted by Section 2.04(b), pursuant to which SCPPA will make payments to the Interest Rate Swap Counterparty at a fixed rate of interest and the Interest Rate Swap Counterparty will make payments to SCPPA at the rate of interest borne by the Index Rate Bonds, in each case in respect of a notional amount equal to the principal amount of Index Rate Bonds to remain outstanding, in each period. Interest Rate Swap Counterparty means, with respect to the initial Interest Rate Swap, the Gas Supplier and any successor to the foregoing, or, if any such Interest Rate Swap is replaced, a member of the International Swaps and Derivatives Association rated at the time of replacement in the top three Rating Categories by at least one Rating Agency, provided that if such Interest Rate Swap Counterparty is not then rated in one of the top two Rating Categories by at least two Rating Agencies, SCPPA shall require such Interest Rate Swap Counterparty to agree to such collateral and security arrangements as SCPPA shall determine to be necessary to protect its interests and to comply with the Act. Interest Rate Swap Payments means, as of each scheduled payment date specified in the Interest Rate Swap, the amount, if any, payable to the Interest Rate Swap Counterparty by SCPPA. Interest Rate Swap Receipts means, as of each payment date specified in the Interest Rate Swap, the amount, if any, payable to SCPPA by the Interest Rate Swap Counterparty. Internal Revenue Code means the Internal Revenue Code of 1986, as amended. Maximum Annual Debt Service means the greater of (1) the Aggregate Debt Service during the current Fiscal Year or (2) the greatest Aggregate Debt Service in any future Fiscal Year. Maximum Rate means 12% per annum. Month means a calendar month. Monthly Administration Fee shall have the meaning ascribed thereto in Section 3.3 of the Gas Supply Contracts. Moody s means Moody s Investors Service, Inc., its successors and assigns, and, if such corporation shall no longer perform the functions of a securities rating agency, Moody s shall be deemed to refer to any other nationally recognized securities rating agency designated by SCPPA. Net Participant Price shall have the meaning ascribed thereto in the Gas Purchase Agreements. 11

40 Non-Service Area Sale shall have the meaning ascribed thereto in the Gas Purchase Agreements. Operating Expenses means, to the extent properly allocable to the Gas Project, (a) SCPPA s expenses for operation of the Gas Project, including all Rebate Payments and Commodity Swap Payments; costs, collateral deposits and other amounts (other than Commodity Swap Payments) necessary to maintain any Commodity Swap; and payments required under the Gas Purchase Agreements (which may, under certain circumstances, include imbalance charges and other miscellaneous payments, but excluding payments to purchase Gas to be remarketed under Section 7.3(c)(ii) of a Gas Purchase Agreement to remediate a Non-Service Area Sale or Fully Disqualified Sale) or required to be incurred under or in connection with the performance of SCPPA s obligations under the Gas Supply Contracts; (b) any other current expenses or obligations required to be paid by SCPPA under the provisions of this Indenture (other than debt service on the Bonds) or by law or required to be incurred under or in connection with the performance of SCPPA s obligations under the Gas Supply Contracts; and (c) Fiduciaries fees and expenses. Litigation judgments and settlements and indemnification payments in connection with the payment of any litigation judgment or settlement and Extraordinary Expenses are not Operating Expenses. For the avoidance of doubt, Operating Expenses shall not include the repurchase of Identified Receivables, payment of RPA Accrued Interest or any other payments pursuant to the Receivables Purchase Agreement. Operating Fund means the Operating Fund established in Section Opinion of Bond Counsel means a written opinion of Bond Counsel addressed to SCPPA and delivered to the Trustee. Opinion of Counsel means an opinion signed by an attorney or firm of attorneys (who may be counsel to SCPPA) selected by SCPPA. Outstanding, when used with reference to Bonds, means as of any date, Bonds theretofore or thereupon being authenticated and delivered under this Indenture except: (a) Bonds cancelled (or portions thereof deemed to have been cancelled) by the Trustee at or prior to such date; (b) Bonds (or portions of Bonds) for the payment or redemption of which moneys, equal to the principal amount or Redemption Price thereof, as the case may be, with interest to the date of maturity or redemption date, shall be held in trust in accordance with this Indenture and set aside for such payment or redemption (whether at or prior to the maturity or redemption date), provided that if such Bonds (or portions of Bonds) are to be redeemed, notice of such redemption shall have been given or provision satisfactory to the Trustee shall have been made for the giving of such notice as provided in Article IV; (c) Bonds in lieu of or in substitution for which other Bonds shall have been authenticated and delivered pursuant to Article III or Section 11.06; (d) Bonds deemed to have been paid as provided in Section 12.01(b); and 12

41 (e) Bonds (or portions thereof) deemed to have been purchased pursuant to the provisions of any Supplemental Indenture in lieu of which other Bonds have been authenticated and delivered as provided in such Supplemental Indenture. Participants means those broker-dealers, banks and other financial institutions from time to time for which DTC holds Bonds as Securities Depository. Paying Agent means any bank or trust company organized under the laws of any state of the United States of America or any national banking association designated as paying agent for the Bonds, and its successor or successors hereafter appointed in the manner provided in this Indenture. Person means natural persons, firms, associations, corporations and public bodies. Principal Installment means, as of any date of calculation, (a) the principal amount of Bonds due on a certain future date for which no Sinking Fund Installments have been established, or (b) the unsatisfied balance (determined as provided in Section 4.02(c)) of any Sinking Fund Installments due on a certain future date in a principal amount equal to said unsatisfied balance of such Sinking Fund Installments. Project Fund means the Project Fund established in Section Project Participant means the parties listed on Schedule I (or any other party who is a permitted transferee pursuant to a Gas Supply Contract) to the extent that any such party s Gas Supply Contract has not expired or been otherwise terminated and for which no amounts are still owing under its Gas Supply Contract. Qualified Investments means any of the following investments, if and to the extent that the same are at the time legal investments of SCPPA s funds and at the time of investment are rated (or are issued or guaranteed by an entity rated) in one of the two highest Rating Categories for long-term investments and the highest Rating Category for short-term investments for each Rating Agency rating the Bonds; provided, however, that investments listed in (d) below are rated (or are issued or guaranteed by an entity rated), except for (c) below, in one of the three highest Rating Categories for long-term investments for each Rating Agency rating the Bonds: (a) Direct obligations of the United States government or any of its agencies; (b) Obligations guaranteed as to principal and interest by the United States government or any of its agencies; (c) Certificates of deposit and other evidences of deposit at state and federally chartered banks, savings and loan institutions or savings banks (each having the highest short-term rating by each Rating Agency then rating the Bonds) deposited and collateralized as required by law; (d) Repurchase agreements, guaranteed investment contracts, or similar agreements entered into with the United States or its agencies or with any bank, financial institution, broker-dealer or other such entity so long as the obligation of the obligated 13

42 party is secured by a perfected pledge of full faith and credit obligations of the United States or its agencies; (e) Guaranteed investment contracts or similar agreements providing for a specified rate of return over a specified time period; (f) corporate bonds; (g) Direct general obligations of a state of the United States, or a political subdivision or instrumentality thereof, having general taxing powers; (h) Obligations of any state of the United States or a political subdivision or instrumentality thereof, secured solely by revenues received by or on behalf of the state or political subdivision or instrumentality thereof irrevocably pledged to the payment of principal of and interest on such obligations; (i) Money market funds, including those for which the Trustee or any Affiliate thereof provides investment advisory or other services; or (j) Any other investments permitted by applicable law for the investment of the funds of SCPPA. Qualified Sale shall have the meaning ascribed thereto in the Gas Purchase Agreements. Rating Agency means Fitch, Moody s or S&P or any other rating agency so designated in a Supplemental Indenture. Rating Category means one or more of the generic rating categories of a Rating Agency, without regard to any refinement or gradation of such rating category or categories by a numerical modifier or otherwise. Rating Confirmation means written confirmation that upon the effectiveness of any proposed action, all Outstanding Bonds will continue to be assigned at least the same or equivalent ratings (including the same or equivalent numerical or other modifiers within a Rating Category) by each Rating Agency then rating such Outstanding Bonds. Rebate Amount for the Bonds of any issue as of any Computation Date means the rebate amount with respect to the Bonds of such issue determined in accordance with Section of the Regulations. Rebate Calculation Date for the Bonds of any issue means (1) any Computation Date for the Bonds of such issue specified by Written Certificate of SCPPA that occurs on or before the fifth anniversary of the issue date of the Bonds of such issue and, if no such Written Certificate of SCPPA is theretofore received by the Trustee, the last Computation Date for the Bonds of such issue on or before such fifth anniversary, (2) each subsequent Computation Date for the Bonds of such issue specified by Written Certificate of SCPPA that occurs on or before the fifth anniversary of the immediately preceding Rebate Calculation Date for the Bonds of such 14

43 issue or, if no such Written Certificate of SCPPA is given, each such fifth anniversary of the first such Rebate Calculation Date for the Bonds of such issue, and (3) the final Computation Date for the Bonds of such issue. Rebate Payments means those portions of moneys or securities held in any Fund hereunder that are required to be paid to the United States Treasury Department to comply with the conditions of Section 148(f) of the Internal Revenue Code. Receivables Purchase Agreement means the Amended and Restated Receivables Purchase Agreement, dated October 3, 2007as of the date hereof, among SCPPA, the Trustee and the Gas Supplier, as amended from time to time. Redemption Account means the Redemption Account in the Debt Service Fund established in Section Redemption Price means, with respect to any Bond, the amount payable upon redemption thereof pursuant to such Bond or this Indenture, excluding accrued interest to the redemption date. Regular Record Date shall have the meaning given to such term in Section Regulations means the temporary or final Income Tax Regulations applicable to the Bonds pursuant to sections 141 through 150 of the Internal Revenue Code. Any reference to a Section of the Regulations shall also refer to any successor provision to such Section hereafter promulgated by the Internal Revenue Service pursuant to sections 141 through 150 of the Internal Revenue Code and applicable to the Bonds. Remarketing Default shall have the meaning ascribed thereto in the Gas Purchase Agreements. Remarketing Purchase Price shall have the meaning ascribed thereto in the Gas Purchase Agreements. Remarketing Reserve Account means the Remarketing Reserve Account in the Project Fund established in Section Revenue Fund means the Revenue Fund established in Section Revenues means (a) all revenues, income, rents, user fees or charges, and receipts derived or to be derived by SCPPA from or attributable or relating to the ownership and operation of the Gas Project, including all revenues attributable or relating to the Gas Project or to the payment of the costs thereof received or to be received by SCPPA under the Gas Supply Contracts or otherwise payable to it for the sale and/or transportation of Gas or otherwise with respect to the Gas Project (excluding (i) proceeds from the sale of the Bonds, (ii) any Termination Payment, (iii) gross receipts from the remarketing of Gas pursuant to Section 7.4 of the Gas Purchase Agreements to the extent offset by costs of purchase of Gas, (iv) payments received on the Surety Bonds, (v) any Additional Termination Payment and (vi) proceeds received pursuant to the Receivables Purchase Agreement based on a Put Option Notice (as 15

44 described in Section 2.1(a) of the Receivables Purchase Agreement) delivered under Sections 2.1(a) or, 2.1(b) or 2.1(d) of the Receivables Purchase Agreement), (b) the proceeds of any insurance covering business interruption loss relating to the Gas Project, (c) interest received or to be received on any moneys or securities (other than moneys or securities held in the Redemption Account in the Debt Service Fund or that portion of moneys in the General Operating Account in the Operating Fund required for Rebate Payments) held pursuant to this Indenture and paid or required to be paid into the Revenue Fund, and (d) any Commodity Swap Receipts (and any payments under the guaranty, if any, relating to the Commodity Swaps) and Interest Rate Swap Receipts received by SCPPA and (e) payments received from the Gas Supplier pursuant to the Receivables Purchase Agreement to the extent allocation is not otherwise specifically provided for in this Indenture; but Revenues shall not include the Monthly Administration Fee. RPA Accrued Interest means accrued but unpaid interest payable by SCPPA under the Receivables Purchase Agreement. S&P means Standard & Poor s Ratings Services, a division of The McGraw-Hill Companies, Inc., its successors and assigns, and, if such entity shall no longer perform the functions of a securities rating agency, S&P shall be deemed to refer to any other nationally recognized securities rating agency designated by SCPPA. Scheduled Debt Service Deposits means the required monthly and cumulative deposits to the Debt Service Account in the Debt Service Fund or the required cumulative deposits thereto in respect of the principal and interest payments coming due on the Bonds and any payments coming due on the Interest Rate Swap on each Interest Payment Date or date for payment of each Principal Installment, all as set forth on Schedule II hereto, as such amount may be reduced as described in Section SCPPA means Southern California Public Power Authority, a joint powers agency organized and existing under the Act and the Joint Powers Agreement, dated November 1, 1980, as amended from time to time, and its successors and assigns. Securities Depository means DTC, or its nominee, and its successors and assigns. Sinking Fund Installment means the amount so designated in Section Special Record Date shall have the meaning given to such term in Section State means the State of California. Subaccount or Subaccounts means, as the case may be, each or all of the Subaccounts established in Section Supplemental Indenture means any indenture supplemental to or amendatory of this Indenture executed and delivered by SCPPA and the Trustee in accordance with Article X. Surety Bond or Surety Bonds means, as the case may be, each or all of the surety bonds entitled Debt Service Reserve Surety Bonds delivered by the Surety Provider to the 16

45 Trustee and deposited into the Debt Service Reserve Subaccounts in the Debt Service Reserve Account pursuant to Section Surety Bond Coverage has the meaning given to such term in Section 5.09 hereof. Surety Provider means National Public Finance Guarantee Corporation ( NPFG ), the successor in interest to MBIA Insurance Corporation, as the provider of the Surety Bonds. Tax Agreement means the Tax Certificate of SCPPA, dated as of the date of issuance and delivery of the Bonds. Taxable Investment means any investment of Gross Proceeds of the Bonds, including time and demand deposits, other than: (1) an obligation the interest on which is excluded from the gross income, as defined in section 61 of the Internal Revenue Code, of the owners thereof for federal income tax purposes (or, when such obligation was issued, was purported by the evidence of such obligation to be so excluded) and not a preference item, as defined in section 57 of the Internal Revenue Code; and (2) an interest in a regulated investment company to the extent that at least 95% of the income to the holder of such interest is excluded from gross income under section 103(a) of the Internal Revenue Code and is not such a preference item. Termination Payment has the meaning given to such term in the Gas Purchase Agreements and, in addition, means any sum paid to or for the account of SCPPA by the Gas Supplier following a Remarketing Default in consideration of an amendment to a Gas Purchase Agreement to reduce the quantity of Gas thereafter to be delivered by the Gas Supplier to SCPPA thereunder. Three-Month LIBOR Rate has the meaning given to such term in Section 2.02(c) hereof. Trust Estate means (a) the proceeds of the sale of the Bonds, (b) all right, title and interest of SCPPA in, to and under the Gas Supply Contracts (excluding the Monthly Administration Fees), the Commodity Swaps, the Interest Rate Swap, the Surety Bonds, and any guaranty and proceeds thereof and of the Trustee in, to, and under the Collateral Agreement, excluding Additional Termination Payments, (c) the Revenues, (d) any Termination Payment or the right to receive such Termination Payment (subject to the Collateral Agreement), (e) any right to sell netidentified Receivables owed by Project Participants under the Gas Supply Contracts or amounts received pursuant to, (f) all right, title and interest of SCPPA in, to and under the Receivables Purchase Agreement as provided in Sections 5.04(b), 5.07(including payments received from the Gas Supplier pursuant thereto), (hg) and 5.08(a)all right, title and interest of SCPPA in, to and under the Gas Supplier Guarantee, and (fh) all Funds established by this Indenture (other than the Rebate Payments held in the General Operating Account of the Operating Fund), including the investments therein and the investment income therefrom, if any, subject to the provisions of this Indenture permitting the application thereof for the purposes and on the terms and conditions set forth herein. Trustee means U.S. Bank National Association, and its successor or successors and any other corporation or national banking association which may at any time be substituted in its place pursuant to this Indenture. 17

46 Working Capital Account means the Working Capital Account in the Project Fund established in Section Written Certificate of SCPPA, Written Direction of SCPPA, Written Notice of SCPPA, Written Request of SCPPA and Written Statement of SCPPA means an instrument in writing signed on behalf of SCPPA by an Authorized Authority Representative thereof. Any such instrument and any supporting opinions or certificates may, but need not, be combined in a single instrument with any other instrument, opinion or certificate, and the two or more so combined shall be read and construed so as to form a single instrument. Any such instrument may be based, insofar as it relates to legal, accounting or engineering matters, upon the opinion or certificate of counsel, consultants, accountants or engineers, unless the Authorized Authority Representative signing such Written Certificate, Direction, Notice, Request or Statement knows, or in the exercise of reasonable care should know, that the opinion or certificate with respect to the matters upon which such Written Certificate, Direction, Notice, Request or Statement may be based, as aforesaid, is erroneous. The same Authorized Authority Representative, or the same counsel, consultant, accountant or engineer, as the case may be, need not certify to all of the matters required to be certified under any provision of this Indenture, but different Authorized Authority Representatives, counsel, consultants, accountants or engineers may certify to different facts, respectively. Every Written Certificate, Direction, Notice, Request or Statement of SCPPA, and every certificate or opinion of counsel, consultants, accountants or engineers provided for herein shall include: (1) a statement that the person making such certificate, direction, notice, request, statement or opinion has read the pertinent provisions of this Indenture to which such certificate, direction, notice, request, statement or opinion relates; (2) a brief statement as to the nature and scope of the examination or investigation upon which the certificate, direction, notice, request, statement or opinion is based; (3) a statement that, in the opinion of such person, he or she has made such examination or investigation as is necessary to enable him or her to express an informed opinion with respect to the subject matter referred to in the instrument to which his or her signature is affixed; and (4) with respect to any statement relating to compliance with any provision hereof, a statement whether or not, in the opinion of such person, such provision has been complied with. Yield means: (1) in the case of Taxable Investments acquired with (or representing an investment of) Gross Proceeds of the Bonds of any issue on or before any date, the actuarial yield of all such Taxable Investments, as yield is defined in and determined in accordance with Section of the Regulations; and (2) in the case of the Bonds of any issue, the actuarial yield of the Bonds of such issue, as defined in Section of the Regulations. 18

47 Section 1.02 Captions. The captions or headings in this Indenture are for convenience only and in no way define, limit or describe the scope and intent of any provisions of this Indenture. Section 1.03 Rules of Construction. Except where the context otherwise requires, words of any gender shall include correlative words of the other genders; words importing the singular number shall include the plural number and vice versa; and words importing persons shall include firms, associations, trusts, corporations or governments or agencies or political subdivisions thereof. The term include and its derivations are not limiting. All references in this Indenture to designated Articles, Sections, Exhibits, Schedules, and other subdivisions are to be designated Articles, Sections, Exhibits, Schedules, and other subdivisions of this Indenture. The words herein, hereof, and hereunder and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section, Exhibit, Schedule, or other subdivision. Section 1.04 Governing Law. This Indenture shall be governed by and construed in accordance with the laws of the State without regard to choice of law principles that may direct the application of the laws of another jurisdiction. Each party agrees that any actions in connection with this Indenture shall be commenced in any court of competent jurisdiction in the County of Los Angeles in the State of California and each party hereby irrevocably accepts, for itself and in connection with its properties, generally and unconditionally, the exclusive jurisdiction and venue of such courts and waives any objections on the basis of forum non conveniens or otherwise with respect to the venue of any such action being heard in Los Angeles, California. Section 1.05 Representation by Counsel. Each of the parties were represented by its respective legal counsel during the negotiation and execution of this Indenture. ARTICLE II Authorization and Issuance of Bonds Section 2.01 Authorization of Bonds; Application of Proceeds. There are hereby authorized to be issued, pursuant to the provisions of this Indenture, (i) a series of bonds in the initial aggregate principal amount of $302,995,000 to be designated, and distinguished from all other bonds by the title, Gas Project Revenue Bonds (Project No. 1), Series 2007A and (ii) a series of bonds in the initial aggregate principal amount of $201,450,000 to be designated, and distinguished from all other bonds by the title, Gas Project Revenue Bonds (Project No. 1), Series 2007B, each entitled to the benefit, protection and security of such provisions, for the purpose of financing the Cost of Acquisition of the Gas Project. The proceeds of the Bonds shall behave been applied as provided in a Written Request of SCPPA delivered upon issuance of the Bonds. Section 2.02 Terms of Bonds; Payment. (a) The Bonds of each series shall be dated as of the date of authentication and delivery thereof, shall bear interest from the date of initial date of authentication and delivery of the Bonds or from the most recent Interest Payment Date 19

48 therefor to which interest has been paid or duly provided for, payable on each Interest Payment Date therefor, and shall be subject to redemption as provided in Article IV. The principal and Redemption Price of and interest on the Bonds shall be payable at the corporate trust operations office of the Trustee, and such banking institution is hereby appointed Paying Agent and Bond Registrar for the Bonds; provided, however, that interest on the Bonds may be paid, at the option of SCPPA, by check payable to the order of the person entitled thereto, and mailed by first class mail, postage prepaid, to the address of such person as shall appear on the books of SCPPA kept at the office of the Bond Registrar. The principal and Redemption Price of and interest on all Bonds shall also be payable at any other place which may be provided for such payment by the appointment of any other Paying Agent or Paying Agents as permitted by this Indenture. SCPPA shall provide Written Notice to the Trustee of the appointment of any additional Paying Agent. (b) The Fixed Rate Bonds have matured or shall mature on November 1 of each of the years and in the principal amounts set forth below, and shall bear interest at the per annum rates for their respective maturities as set forth below: Year Amount Interest Rate 2009 $ 5,625, % ,715, ,295, ,805, ,065, ,875, ,075, ,275, ,605, ,385, ,445, ,725, ,940, ,705, ,250, ,850, ,805, ,655, ,750, ,965, ,795, ,390, Interest on the Fixed Rate Bonds will be computed on the basis of a 360-day year of twelve 30-day months. (c) The Index Rate Bonds shall mature on November 1, 2038 in the aggregate principal amount of $36,000,000, representing an aggregate principal amount of $201,450,000 initially issued less $165,450,000 aggregate principal amount heretofore paid or otherwise 20

49 surrendered and cancelled. The Index Rate Bonds will bear interest for the initial interest period extending from the date of initial issuance of the Index Rate Bonds to the first Interest Payment Date for the Index Rate Bonds at the rate of % per annum and for each succeeding interest period extending from an Interest Payment Date therefor to the immediately succeeding Interest Payment Date therefor at a per annum rate equal to (A) 67% of the Three-MonthThree- Month LIBOR Rate for such interest period plus (B) the per annum spread of 1.47%, except that the Index Rate Bonds may not bear interest in any interest period at more than the Maximum Rate of 12% per annum. Interest on the Index Rate Bonds will be payable on each Interest Payment Date therefor. Interest on the Index Rate Bonds will be computed on the basis of a 365- or 366-day year, as applicable, for the actual number of days elapsed, subject to the limitations on accrual of interest contained in the definition of Interest Payment Date. The interest rate on the Index Rate Bonds will always be rounded to the fifth decimal place. Three-Month LIBOR Rate for each interest period from and including any Interest Payment Date for Index Rate Bonds to and excluding the next such Interest Payment Date means the rate for deposits in U.S. dollars with a three-month maturity that appears on Reuters Screen LIBOR01 Page (or such other page as may replace that page on that service, or such other service as may be nominated by the British Bankers Association, for the purpose of displaying London interbank offered rates for U.S. dollar deposits) as of 11:00 a.m., London time, on the day that is two London Banking Days (as defined in the Interest Rate Swap) preceding the first day of such period, except that, if such rate does not appear on such page, the Three-Month LIBOR Rate means a rate determined on the basis of the rates at which deposits in U.S. dollars for a three-month maturity and in a principal amount of at least U.S. $1,000,000 are offered at approximately 11:00 a.m. London time, on the day that is two London Banking Days preceding the first day of such period, to prime banks in the London interbank market by four major banks in the London interbank market (herein referred to as the Reference Banks ) selected by the Gas Supplier or any successor Interest Rate Swap Counterparty, as calculation agent (the Calculation Agent ). The Calculation Agent is to request the principal London office of each of such Reference Banks to provide a quotation of its rate. If at least two such quotations are provided, the Three-Month LIBOR Rate will be the arithmetic mean of such quotations. If fewer than two quotations are provided, the Three-Month LIBOR Rate will be the arithmetic mean of the rates quoted by major banks in New York City, selected by the Calculation Agent, at approximately 11:00 a.m., New York City time, on the day that is two London Banking Days preceding the first day of such period for loans in U.S. dollars to leading European banks in a principal amount of at least U.S. $1,000,000 having a three-month maturity. If the banks in New York City selected by the Calculation Agent are not then quoting rates for such loans, then the Three-Month LIBOR Rate for the ensuing interest period will mean the Three-Month LIBOR Rate in effect in the immediately preceding interest period. Section 2.03 Provisions Regarding Commodity Swaps. (a) In connection with the Gas Project SCPPA shall enter into the initial Commodity Swaps with the Commodity Swap Counterparty in replacement of commodity swap transactions heretofore entered into with AIG- FP Broadgate Limited. A separate Commodity Swap will be entered into by SCPPA with respect to each Project Participant. The following shall apply to each Commodity Swap: 21

50 (i) The method for the calculation of the Commodity Swap Payments and Commodity Swap Receipts, as applicable, and the scheduled payment dates therefor are set forth in the Commodity Swaps. (ii) Commodity Swap Payments with respect to a Commodity Swap relating to a given Project Participant shall be made by the Trustee on behalf of SCPPA out of the related Subaccount in the Commodity Swaps Operating Account and, if required, the related Subaccount in the Working Capital Account. (iii) Commodity Swap Receipts received by SCPPA or by the Trustee on behalf of SCPPA with respect to a Commodity Swap relating to a given Project Participant shall be deposited directly into the related Account in the Revenue Fund. (b) The following shall apply with respect to restrictions on replacement and termination of a Commodity Swap: (b) (i) Except as provided in clause (c) below, SCPPA agrees that it will not exercise any right to declare an early termination date under a Commodity Swap unless either (a): (i) SCPPA has entered into a replacement Commodity Swap in accordance with clause (iic), (iii) or (iv), below, and such replacement Commodity Swap will be effective as of such early termination date and cover index price exposure from and after such early termination date, or (b) (ii) in all other cases, the corresponding Gas Purchase Agreement will terminate prior to or as of such early termination date. (c) (ii) SCPPA may not replace any Commodity Swap, the Commodity Swap Counterparty or the guarantor of the Commodity Swap Counterparty unless SCPPA is replacing the Commodity Swap with a similar agreement for the same hedging purposes with an alternate Commodity Swap Counterparty at any time upon delivery to the Trustee of a Rating Confirmation.and, with respect to any replacement of the Commodity Swap Counterparty or its guarantor, one of the following conditions is met: (i) SCPPA delivers to the Trustee a Rating Confirmation that takes into account such replacement, (ii) If a Commodity Swap is subject to termination (or, in the case of clause (B) below, is terminated) by either party in accordance with its terms, then (A) SCPPA may, subject to clause (i) above, terminate such Commodity Swap if SCPPA has the right to do so, and (B) SCPPA may enter into a replacement Commodity Swap with an alternate Commodity Swap Counterparty without Rating Confirmation, but only if the replacement Commodity Swap is in all respects substantially identical to the existing Commodity Swap, except for the identity of the Commodity Swap Counterparty, and (1) thesuch alternate Commodity Swap Counterparty (or its credit support provider under a Commodity Swap) is then rated at least AA- or Aa3, as applicable, by each Rating 22

51 Agency rating the Bonds or, in either case, at least as highly as the rating then assigned by each Rating Agency to the Bonds, or (2) the (iii) such alternate Commodity Swap Counterparty provides such collateral and security arrangements as SCPPA shall determine to be necessary to avoid a reduction in the rating assigned to the Bonds. (d) SCPPA shall designate an early termination date pursuant to the terms of the Commodity Swap if, at any time, SCPPA or the Trustee has received six consecutive monthly payments due to SCPPA under the Commodity Swap directly from the Custodian under the Custodial Agreement, dated as of July [ ], 2013, among the Trustee, in its capacity as Trustee and as Custodian thereunder, the Commodity Swap Counterparty and the Gas Supplier. SCPPA shall comply with clause (b) above in designating such early termination date. (iv) Any replacement Commodity Swap shall provide that SCPPA may terminate such Commodity Swap if the alternate Commodity Swap Counterparty is rated less than A by S&P or less than A2 by Moody s. (c) The following shall apply with respect to the mandatory termination of a Commodity Swap and Gas Purchase Agreement: (i) SCPPA shall use commercially reasonable efforts to replace any Commodity Swap with an alternate Commodity Swap if the Commodity Swap Counterparty is downgraded below A by S&P or below A2 by Moody s (but not below a rating level that would cause a Commodity Swap Mandatory Termination Event) and if such replacement is in the best interests of the Bondholders. (ii) Upon the occurrence of a Commodity Swap Mandatory Termination Event in respect of a Commodity Swap, SCPPA shall (A) promptly notify the Gas Supplier of such event pursuant to Section 17.5 of the related Gas Purchase Agreement, and (B) in accordance with Section 17.5 of such Gas Purchase Agreement, use its good faith efforts to replace such Commodity Swap with an alternate Commodity Swap during the 45-day replacement period contemplated by Section 17.5 of such Gas Purchase Agreement, subject to the conditions of subsection (b)(ii), (b)(iii) or (b)(iv), above. (iii) If SCPPA is unable to enter into an alternate Commodity Swap pursuant to clause (ii) above during such 45-day replacement period, SCPPA shall (A) designate an Early Termination Date for the corresponding Gas Purchase Agreement in accordance with Section 17.4(c) of the Gas Purchase Agreement, with such Early Termination Date occurring immediately at the end of such 45-day replacement period, and (B) unless the relevant Commodity Swap has been terminated automatically pursuant to Section 6(a) thereof, designate an early termination date for such Commodity Swap pursuant to Section 6(a) thereof with such early termination date occurring concurrently with the Early Termination Date under the Gas Purchase Agreement described in clause (A) above. (iv) A Commodity Swap Mandatory Termination Event in respect of a Commodity Swap is any of the following: (A) an automatic termination of such 23

52 Commodity Swap pursuant to Section 6(a) thereof in respect of which the Commodity Swap Counterparty is the Defaulting Party or Affected Party (as therein defined), (B) a Commodity Swap Counterparty obligated thereon (or, if the obligations of such Commodity Swap Counterparty are guaranteed by another party, such other party only) is downgraded below BBB- by S&P or below Baa3 by Moody s, or (C) such Commodity Swap becomes terminable by SCPPA pursuant to Part 1(i)(D) of such Commodity Swap as a result of a payment default by the Commodity Swap Counterparty obligated thereon. (e) (v) If (i) the Commodity Swap Counterparty gives written notice to the Trustee that either (A) SCPPA has designated an early termination date under any Commodity Swap has been terminated by SCPPA in accordance with its terms (other than pursuant to a Commodity Swap Mandatory Termination Event), or a corresponding(b) either party to a Seller Swap (as defined in the relevanta Gas Purchase Agreement) has been terminated for any reasondesignated an early termination under such Seller Swap for any reason, (ii) the Trustee issues a Call Receivables Offer under the Receivables Purchase Agreement, or (iii) the Gas Supplier fails to pay an amount when due (after giving effect to any grace periods therein) under either the Receivables Purchase Agreement or the DSA Investment Agreement, then the Trustee shall give prompt written notice to the Holders of the Bonds of its intent to conditionally designate an Early Termination Date with respect to the relevant Gas Purchase Agreement pursuant to a Buyer Non-DefaultNon-Default Termination Event described in SectionsSection 17.3(b)(ii) and, 17.3(b)(iii),17.3(b)(ix), or 17.3(b)(x) thereof, respectively. Unless the Trustee is directed not to do so by the Holders of 10075% in principal amount of the Bonds, excluding from the numerator and denominator of such percentage calculation any Bonds owned by the Commodity Swap Counterparty or any of itsthe Gas Supplier or any of their respective Affiliates, within 20 days after such notice is delivered by the Trustee, the Trustee shall conditionally designate an Early Termination Date with respect to the relevant Gas Purchase Agreement, with such Early Termination Date occurring upon the end of the 45-day replacement period contemplated by Section 17.5 of(e) of such Gas Purchase Agreement, which replacement period, pursuant to the Gas Purchase Agreement, shall not, in any event, exceed 45 days, and being conditioned upon the failure to replace the relevant Commodity Swap or Seller Swap or failure of the Gas Supplier to accept the Call Receivables Offer, as applicable, during such replacement period. (f) A Commodity Swap Mandatory Termination Event in respect of a Commodity Swap is any of the following: (A) an automatic termination of such Commodity Swap pursuant to Section 6(a) thereof in respect of which the Commodity Swap Counterparty is the Defaulting Party or Affected Party (as therein defined), or (B) such Commodity Swap becomes terminable by SCPPA pursuant to Section 6 of such Commodity Swap as a result of a payment default by the Commodity Swap Counterparty obligated thereon. 24

53 Section 2.04 Provisions Regarding Interest Rate Swap. (a) In connection with the issuance of the Index Rate Bonds, SCPPA shall enterhas entered into the initial Interest Rate Swap with the Interest Rate Swap Counterparty. The following shall apply to the Interest Rate Swap: (i) The method for the calculation of the Interest Rate Swap Payments and Interest Rate Swap Receipts, as applicable, and the scheduled payment dates therefor are set forth in the Interest Rate Swap. (ii) Interest Rate Swap Payments shall be made by the Trustee on behalf of SCPPA out of the Debt Service Fund on parity with principal and interest payments on Bonds. (iii) Interest Rate Swap Receipts received by SCPPA or by the Trustee on behalf of SCPPA shall be deposited directly into the Debt Service Account. (b) The following shall apply with respect to restrictions on replacement and termination of the Interest Rate Swap: (i) SCPPA agrees that it will not exercise any right to declare an early termination date under the Interest Rate Swap unless either (a) SCPPA has entered into a replacement Interest Rate Swap in accordance with clause (ii), (iii) or (iv), below, and such replacement Interest Rate Swap will be effective as of such early termination date and cover interest rate exposure from and after such early termination date, or (b) in all other cases, the corresponding Gas Purchase Agreement will terminate prior to or as of such early termination date. (ii) SCPPA may replace the Interest Rate Swap with a similar agreement for the same hedging purposes with an alternate Interest Rate Swap Counterparty at any time upon delivery to the Trustee of a Rating Confirmation. (iii) If the Interest Rate Swap is subject to termination (or, in the case of clause (B) below, is terminated) by either party in accordance with its terms, then (A) SCPPA may terminate, subject to clause (i) above, the Interest Rate Swap if SCPPA has the right to do so, and (B) SCPPA may enter into a replacement Interest Rate Swap with an alternate Interest Rate Swap Counterparty without Rating Confirmation, but only if the replacement Interest Rate Swap is in all respects substantially identical to the existing Interest Rate Swap, except for the identity of the Interest Rate Swap Counterparty, and (1) the alternate Interest Rate Swap Counterparty (or its credit support provider under the Interest Rate Swap) is then rated at least AA- or Aa3, as applicable, by each Rating Agency rating the Bonds or, in either case, at least as highly as the rating then assigned by each Rating Agency to the Bonds, or (2) the Interest Rate Swap Counterparty provides such collateral and security arrangements as SCPPA shall determine to be necessary to avoid a reduction in the rating assigned to the Bonds. (iv) Any replacement Interest Rate Swap shall provide that SCPPA may terminate such Interest Rate Swap if the alternate Interest Rate Swap Counterparty is 25

54 rated less than A by S&P or less than A2 by Moody s. ARTICLE III General Terms and Provisions of Bonds Section 3.01 Medium of Payment; Form and Date; Letters and Numbers. (a) The Bonds shall be payable, with respect to interest, principal and Redemption Price, in any coin or currency of the United States of America which at the time of payment is legal tender for the payment of public and private debts. (b) The Bonds may be issued only in the form of fully registered Bonds without coupons, in Authorized Denominations. The Bonds shall be in substantially the form set forth in Exhibit A hereto, and may be printed, engraved, typewritten or otherwise produced. (c) Unless SCPPA shall otherwise direct, the Bonds of a series shall be numbered from one upward. Section 3.02 Legends. The Bonds may contain or have endorsed thereon such provisions, specifications and descriptive words not inconsistent with the provisions of this Indenture as may be necessary or desirable to comply with custom, the rules of any securities exchange or commission or brokerage board, or otherwise, as may be determined by SCPPA prior to the authentication and delivery thereof. Section 3.03 Execution and Authentication. (a) The Bonds shall be executed in the name of SCPPA by the manual or facsimile signature of its President or any Vice President and its seal (or a facsimile thereof), if any, shall be impressed, imprinted, engraved or otherwise reproduced thereon and attested by the manual or facsimile signature of its Secretary or Assistant Secretary, or in such other manner as may be required or permitted by law. In case any one or more of the officers who shall have signed or sealed any of the Bonds shall cease to be such officer before the Bonds so signed and sealed shall have been authenticated and delivered by the Trustee, such Bonds may, nevertheless, be authenticated and delivered as herein provided, and may be issued as if the Persons who signed or sealed such Bonds had not ceased to hold such offices. Any Bond of may be signed and sealed on behalf of SCPPA by such Persons as at the time of the execution of such Bonds shall be duly authorized or hold the proper office in SCPPA, although at the date borne by the Bonds such Persons may not have been so authorized or have held such office. (b) The Bonds shall bear thereon a certificate of authentication, in the form set forth in Exhibit A hereto, executed manually by the Trustee. Only such Bonds as shall bear thereon such certificate of authentication shall be entitled to any right or benefit under this Indenture, and no Bond shall be valid or obligatory for any purpose until such certificate of authentication shall have been duly executed by the Trustee. Such certificate of the Trustee upon any Bond executed on behalf of SCPPA shall be conclusive evidence that the Bond so authenticated has been duly authenticated and delivered under this Indenture and that the Holder thereof is entitled to the benefits of this Indenture. 26

55 Section 3.04 Exchange, Transfer and Registry. (a) The Bonds shall be registered as transferred only upon the books of SCPPA, which shall be kept for such purposes at the designated corporate trust office of the Bond Registrar, by the registered owner thereof in person or by its attorney duly authorized in writing, upon surrender thereof together with a written instrument of transfer satisfactory to the Bond Registrar duly executed by the registered owner or its duly authorized attorney. Upon the registration of transfer of any Bond, SCPPA shall issue in the name of the transferee a new Bond or Bonds of the same series, aggregate principal amount and maturity as the surrendered Bond. (b) The registered owner of any Bond or Bonds of one or more denominations shall have the right to exchange such Bond or Bonds for a new Bond or Bonds of any denomination then authorized for such Bond or Bonds of the same series, aggregate principal amount and maturity of the surrendered Bond or Bonds. Such Bond or Bonds shall be exchanged by SCPPA for a new Bond or Bonds upon the request of the registered owner thereof in person or by its attorney duly authorized in writing, upon surrender of such Bond or Bonds together with a written instrument requesting such exchange satisfactory to the Bond Registrar duly executed by the registered owner or its duly authorized attorney. (c) SCPPA and each Fiduciary may deem and treat the Person in whose name any Bond shall be registered upon the books of SCPPA maintained by the Bond Registrar as the absolute owner of such Bond, whether such Bond shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal and Redemption Price, if any, of and interest on such Bond and for all other purposes, and all such payments so made to any such registered owner or upon its order shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid, and neither SCPPA nor any Fiduciary shall be affected by any notice to the contrary. Section 3.05 Regulations with Respect to Exchanges and Registration of Transfers. In all cases in which the privilege of exchanging or registering the transfer of Bonds is exercised, SCPPA shall execute and the Trustee shall authenticate and deliver Bonds in accordance with the provisions of this Indenture. All Bonds surrendered in any such exchanges or registration of transfer shall forthwith be delivered to the Trustee and cancelled or retained by the Trustee. Prior to every such exchange or registration of transfer of Bonds, whether temporary or definitive, SCPPA or the Bond Registrar may require the Holder to pay an amount sufficient to reimburse it for any tax, fee or other governmental charge required to be paid with respect to such exchange or transfer. Unless otherwise provided in a Supplemental Indenture, neither SCPPA nor the Bond Registrar shall be required (a) to register the transfer of or exchange Bonds for the period next preceding any Interest Payment Date therefor, beginning with the Regular Record Date for such Interest Payment Date and ending on such Interest Payment Date therefor, or for the period next preceding any date for the proposed payment of Defaulted Interest with respect to such Bonds beginning with the Special Record Date for the date of such proposed payment and ending on the date of such proposed payment, (b) to register the transfer of or exchange Bonds for a period beginning 15 days before the mailing of any notice of redemption and ending on the day of such mailing, or (c) to register the transfer of or exchange any Bonds called for redemption. 27

56 Section 3.06 Bonds Mutilated, Destroyed, Stolen or Lost. If any Bond becomes mutilated or is lost, stolen or destroyed, SCPPA may execute and the Trustee shall authenticate and deliver a new Bond of like series, date of issue, maturity date, principal amount and interest rate per annum as the Bond so mutilated, lost, stolen or destroyed, provided that (a) in the case of such mutilated Bond, such Bond is first surrendered to SCPPA, (b) in the case of any such lost, stolen or destroyed Bond, there is first furnished evidence of such loss, theft or destruction satisfactory to SCPPA together with indemnity satisfactory to SCPPA and the Trustee, (c) all other reasonable requirements of SCPPA and the Trustee are complied with, and (d) expenses in connection with such transaction are paid by the Holder. Any Bond surrendered for registration of transfer shall be cancelled. Any such new Bonds issued pursuant to this Section in substitution for Bonds alleged to be destroyed, stolen or lost shall constitute original additional contractual obligations on the part of SCPPA, whether or not the Bonds so alleged to be destroyed, stolen or lost be at any time enforceable by anyone, and shall be equally secured by and entitled to equal and proportionate benefits with all other Bonds issued under this Indenture, in any moneys or securities held by SCPPA or any Fiduciary for the benefit of the Bondholders. Section 3.07 Temporary Bonds. (a) Until the definitive Bonds are prepared, SCPPA may execute, in the same manner as is provided in Section 3.03, and upon the request of SCPPA, the Trustee shall authenticate and deliver, in lieu of definitive Bonds, but subject to the same provisions, limitations and conditions as the definitive Bonds, one or more temporary Bonds substantially of the tenor of the definitive Bonds in lieu of which such temporary Bond or Bonds are issued, and with such omissions, insertions and variations as may be appropriate to temporary Bonds. SCPPA at its own expense shall prepare and execute and, upon the surrender of such temporary Bonds for exchange and the cancellation of such surrendered temporary Bonds, the Trustee shall authenticate and, without charge to the Holder thereof, deliver in exchange therefor, definitive Bonds of the same series, aggregate principal amount and maturity as the temporary Bonds surrendered. Until so exchanged, the temporary Bonds shall in all respects be entitled to the same benefits and security as definitive Bonds authenticated and issued pursuant to this Indenture. (b) All temporary Bonds surrendered in exchange either for another temporary Bond or Bonds or for a definitive Bond or Bonds shall be forthwith cancelled by the Trustee. Section 3.08 Payment of Interest on Bonds; Interest Rights Preserved. Interest on any Bond which is payable, and is punctually paid or duly provided for, on any Interest Payment Date therefor shall be paid to the Person in whose name that Bond is registered at the close of business on the date (hereinafter, the Regular Record Date for such interest) which is the 15th day of the calendar month next preceding such Interest Payment Date. Any interest on any Bond which is payable, but is not punctually paid or duly provided for, on any Interest Payment Date therefor (hereinafter, Defaulted Interest ) shall forthwith cease to be payable to the person who was the registered owner on the relevant Regular Record Date; and such Defaulted Interest shall be paid by SCPPA to the Persons in whose names the Bonds are registered at the close of business on a date (hereinafter, the Special Record Date ) for the payment of such Defaulted Interest, which shall be fixed in the following manner. SCPPA shall notify the Bond Registrar in writing of the amount of Defaulted Interest proposed 28

57 to be paid on each Bond and the date of the proposed payment, and at the same time SCPPA shall deposit with the Paying Agents an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Paying Agents for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this Section provided. Thereupon the Bond Registrar shall fix a Special Record Date for the payment of such Defaulted Interest which shall be not more than 15 nor less than 10 days prior to the date of the proposed payment and not less than 10 days after the receipt by the Bond Registrar of the notice of the proposed payment. The Bond Registrar shall promptly notify SCPPA of such Special Record Date and, in the name and at the expense of SCPPA, shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor to be mailed, first class postage prepaid, to each Bondholder at its address as it appears upon the registry books, not less than 10 days prior to such Special Record Date. Subject to the foregoing provisions of this Section, each Bond delivered under this Indenture upon registration of transfer of or in exchange for or in lieu of any other Bond shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Bond. Section 3.09 Book Entry System; Appointment of Securities Depository. All Bonds shall be registered in the name of Cede & Co., as nominee for DTC, as Securities Depository, and held in the custody or for the account of the Securities Depository. A single certificate will be issued and delivered to the Securities Depository for each maturity of Bonds, and the Beneficial Owners will not receive physical delivery of Bond certificates except as provided in this Indenture. For so long as the Securities Depository shall continue to serve as securities depository for the Bonds as provided herein, all transfers of beneficial ownership interests will be made by book-entry only, and no investor or other party purchasing, selling or otherwise transferring beneficial ownership of Bonds is to receive, hold or deliver any Bond certificate. SCPPA may, with notice to the Trustee but without the consent of any Bondholders, appoint a successor Securities Depository and enter into an agreement with the successor Securities Depository, to establish procedures with respect to a Book-Entry System for the Bonds not inconsistent with the provisions of this Indenture. Any successor Securities Depository shall be a clearing agency registered under Section 17A of the Securities Exchange Act of 1934, as amended. SCPPA and the Trustee may rely conclusively upon (i) a certificate of the Securities Depository as to the identity of the Participants in the Book-Entry System with respect to the Bonds, and (ii) a certificate of any such Participant as to the identity of, and the respective principal amount of the Bonds beneficially owned by the Beneficial Owners. Whenever, during the term of the Bonds, the beneficial ownership thereof is determined by a book-entry at the Securities Depository, the requirements in this Indenture of holding, delivering or transferring such Bonds shall be deemed modified to require the appropriate person to meet the requirements of the Securities Depository as to registering or transferring the bookentry to produce the same effect. Any provision hereof permitting or requiring delivery of the 29

58 Bonds shall, while such Bonds are in such Book-Entry System, be satisfied by the notation on the books of the Securities Depository in accordance with applicable state law. Except as otherwise specifically provided herein with respect to the rights of Participants and Beneficial Owners, when a Book-Entry System is in effect, SCPPA and the Trustee may treat the Securities Depository (or its nominee) as the sole and exclusive owner of the Bonds registered in its name for the purposes of payment of the principal or purchase price of and interest on such Bonds or portion thereof to be redeemed or purchased, of giving any notice permitted or required to be given to the Bondholders under this Indenture and of voting, and neither SCPPA nor the Trustee shall be affected by any notice to the contrary. Neither SCPPA nor the Trustee will have any responsibility or obligations to the Securities Depository, any Participant, any Beneficial Owner or any other Person which is not shown on the bond register, with respect to (a) the accuracy of any records maintained by the Securities Depository or any Participant; (b) the payment by the Securities Depository or by any Participant of any amount due to any Beneficial Owner in respect of the principal amount or redemption or purchase price of, or interest on, any Bonds; (c) the delivery of any notice by the Securities Depository or any Participant; (d) the selection of the Beneficial Owners to receive payment in the event of any partial redemption of any of the Bonds; or (e) any other action taken by the Securities Depository or any Participant. The Trustee shall pay all principal or Redemption Price of and interest on the Bonds registered in the name of Cede only to or upon the order of the Securities Depository (as that term is used in the Uniform Commercial Code as adopted in the State and New York), and all such payments shall be valid and effective to fully satisfy and discharge SCPPA s obligations with respect to the principal, Redemption Price or purchase price of and interest on such Bonds to the extent of the sum or sums so paid. The Book-Entry System may be discontinued by the Trustee and SCPPA, at the direction and expense of SCPPA, and SCPPA and the Trustee will cause the delivery of Bond certificates to such Beneficial Owners of the Bonds and registered in the names of such Beneficial Owners as shall be specified to the Trustee by the Securities Depository in writing, under the following circumstances: (i) The Securities Depository determines to discontinue providing its service with respect to any Bonds and no successor Securities Depository is appointed as described in this Section Such a determination may be made at any time by giving 30 days notice to SCPPA and the Trustee and discharging its responsibilities with respect thereto under applicable law; or (ii) SCPPA determines not to continue the Book-Entry System through a Securities Depository for the Bonds. When the Book-Entry System is not in effect, all references herein to the Securities Depository shall be of no further force or effect. 30

59 ARTICLE IV Redemption of Bonds Section 4.01 Extraordinary Redemption. The Bonds shall be subject to mandatory redemption prior to maturity, in the amounts hereinafter stated, at a Redemption Price equal to (i) the Amortized Value plus accrued interest to the redemption date, in the case of the Fixed Rate Bonds, and (ii) 100% of the principal amount plus accrued interest to the redemption date, in the case of the Index Rate Bonds, (a) on the first day of the Month after each Early Termination Payment Date and (b) within 90 days after the occurrence of each Remarketing Default under a Gas Purchase Agreement that does not result in an Early Termination Date thereunder. SCPPA shall provide the Trustee with Written Notice of the Early Termination Payment Date not more than five days after such date is determined, which notice shall include SCPPA s calculation of the Amortized Value of the Fixed Rate Bonds to be redeemed. Set forth as Schedule IV are the principal amount of each maturity and series of Bonds to be paid primarily from payments to be made by the Project Participants under their respective Gas Supply Contracts. Schedule IV includes a separate schedule for each Project Participant. In the event of an extraordinary redemption of Bonds as a result of an Early Termination Payment Date pursuant to the Gas Purchase Agreement relating to a Project Participant, the principal amount of Outstanding Bonds of each maturity and series to be redeemed pursuant to this Section shall be the amount set forth in the schedule in Schedule IV applicable to such Project Participant. In the event of an extraordinary redemption of Bonds as a result of a Remarketing Default under a Gas Purchase Agreement relating to a Project Participant that does not result in an Early Termination Date thereunder, and upon the receipt of Rating Confirmations, the principal amount of Bonds to be redeemed shall be the least aggregate principal amount that, in the Opinion of Bond Counsel, would preserve the excludability of interest on the Bonds from gross income of the owners thereof for federal income tax purposes, allocated between the Bonds of each maturity in any manner determined by SCPPA consistent with such Opinion of Bond Counsel and, within each such maturity, proportionately among series to the greatest extent practicable. The Bonds of any maturity and series to be redeemed in part shall be selected as allocated pursuant to the immediately preceding sentence. Section 4.02 Sinking Fund Redemption. (a) The Fixed Rate Bonds maturing November 1, 2033 shall be subject to redemption prior to their stated maturity in part (by lot) from Sinking Fund Installments, at the principal amount thereof, without premium, on November 1 of each of the following years and in the following aggregate principal amounts: Year Principal Amount *Final Maturity 2030 $23,800, ,910, ,220, * 30,460,000 31

60 (b) The Index Rate Bonds shall be subject to redemption prior to their stated maturity in part (by lot) from Sinking Fund Installments, at the principal amount thereof, without premium, on November 1 of each of the following years and in the following net aggregate principal amounts: Year Original Principal Amount Cancelled and Credited Net Principal Amount *Final Maturity 2034 $32,905,000 $14,850,000 $18,055, ,490,000 17,545, , ,305,000 38,305, ,065,000 41,065, * 53,685,000 53,685,000 - (c) If at any time Bonds of any series and maturity for which Sinking Fund Installments shall have been established are (i) purchased or redeemed other than pursuant to Section 5.07(d) (including, but not limited to, Section 5.03(b)) or (ii) deemed to have been paid pursuant to Section 12.01(b) and, with respect to such Bonds which have been deemed paid, irrevocable instructions have been given to the Trustee to redeem or purchase the same on or prior to the due date of the Sinking Fund Installment to be credited under this subsection (c), SCPPA may from time to time and at any time by written direction to the Trustee specify the portion, if any, of such Bonds so purchased, redeemed or deemed to have been paid and not previously applied as a credit against any Sinking Fund Installment which are to be credited against future Sinking Fund Installments for Bonds of the same series and maturity. Such direction shall specify the amounts of such Bonds to be applied as a credit against each Sinking Fund Installment or Installments and the particular Sinking Fund Installment or Installments against which such Bonds are to be applied as a credit; provided, however, that none of such Bonds may be applied as a credit against a Sinking Fund Installment to become due less than 45 days (or such lesser period of time with respect to Section 5.03(b)) after such notice is delivered to the Trustee. All such Bonds to be applied as a credit shall be surrendered to the Trustee for cancellation on or prior to the due date of the Sinking Fund Installment against which they are being applied as a credit. The portion of any such Sinking Fund Installment remaining after the deduction of any such amounts credited toward the same (or the original amount of any such Sinking Fund Installment if no such amounts shall have been credited toward the same) shall constitute the unsatisfied balance of such Sinking Fund Installment for the purpose of calculation of Sinking Fund Installments due on a future date. (d) Upon the credit of a Sinking Fund Installment or Installments pursuant to Section 4.02(c), within 20 days thereafter SCPPA shall deliver to the Trustee a revised Schedule IV to this Indenture, together with a Written Direction of SCPPA to substitute the revised Schedule IV for the prior schedule (or any previously delivered schedules provided to the Trustee) and an Accountant s Certificate pursuant to Section Section 4.03 option of SCPPA. No Optional Redemption. The Bonds are not subject to redemption at the 32

61 Section 4.04 Redemption Notice. When redemption of Bonds is authorized or required pursuant to Section 4.07, the Trustee shall give notice, in the name of SCPPA, of the redemption of such Bonds by first-class mail, postage prepaid, not less than 30 days (15 days in the case of redemption pursuant to Section 4.01) and not more than 45 days (30 days in the case of redemption pursuant to Section 4.01) prior to the redemption date to the registered owner of each Bond being redeemed, at its address as it appears on the bond registration books of the Trustee or at such address as such owner may have filed with the Trustee for that purpose, as of the Regular Record Date. The notice shall identify the Bonds to be redeemed and shall state (i) the redemption date, (ii) the Redemption Price or the manner in which it will be calculated, (iii) that the Bonds called for redemption must be surrendered to collect the Redemption Price, (iv) the address at which the Bonds must be surrendered, and (v) that interest on the Bonds called for redemption ceases to accrue on the redemption date. Failure of the registered owner of any Bonds which are to be redeemed to receive any such notice, or any defect in such notice, shall not affect the validity of the proceedings for the redemption of any other Bonds as to which proper notice was given as provided herein. Section 4.05 Bonds Redeemed in Part. Upon surrender of a Bond redeemed in part, SCPPA will execute and the Trustee will authenticate and deliver to the registered owner thereof a new Bond or Bonds of the same series and maturity in Authorized Denominations equal in principal amount to the unredeemed portion of the Bond surrendered. Notwithstanding anything herein to the contrary, so long as the Bonds are held in the Book-Entry System the Bonds will not be delivered as set forth above; rather transfers of Beneficial Ownership of such Bonds to the person indicated above will be effected on the registration books of the Securities Depository pursuant to its rules and procedures. Section 4.06 [Reserved.] Section 4.07 Trustee Action to Effect Redemption. Whenever by the terms of this Indenture the Trustee is required or authorized to redeem Bonds, the Trustee shall (i) select the Bonds or portions of Bonds to be redeemed, (ii) give the notice of redemption and (iii) pay out of moneys available therefor the Redemption Price thereof, plus interest accrued and unpaid to the redemption date, to the appropriate Paying Agents in accordance with the terms of this Article IV and, to the extent applicable, Sections 5.07 and Section 4.08 Selection of Bonds to be Redeemed. If less than all of the Bonds of like series and maturity shall be called for redemption, the particular Bonds or portions of Bonds to be redeemed shall be selected at random by the Trustee in such manner as the Trustee in its discretion may deem fair and appropriate, from Bonds not previously called for redemption; provided, however, that the portion of any Bond of a denomination of more than a minimum Authorized Denomination to be redeemed shall be in the principal amount of such minimum Authorized Denomination or a multiple thereof, and that, in selecting portions of such Bonds for redemption, the Trustee shall treat each such Bond as representing that number of Bonds of a minimum Authorized Denomination which is obtained by dividing by such minimum Authorized Denomination the principal amount of such Bond to be redeemed in part. Section 4.09 Payment of Redeemed Bonds. Notice having been given in the manner provided in Section 4.04, the Bonds or portions thereof so called for redemption shall become 33

62 due and payable on the redemption date so designated at the Redemption Price, plus interest accrued and unpaid to the redemption date, and, upon presentation and surrender thereof at the office specified in such notice, such Bonds, or portions thereof, shall be paid at the Redemption Price, plus interest accrued and unpaid to the redemption date. If there shall be drawn for redemption less than all of a Bond, SCPPA shall execute and the Trustee shall authenticate and the Paying Agent shall deliver, upon the surrender of such Bond, without charge to the owner thereof, for the unredeemed balance of the principal amount of the Bonds so surrendered, Bonds of like maturity in any of the Authorized Denominations. If, on the redemption date, moneys for the redemption of all the Bonds or portions thereof of any like series and maturity to be redeemed, together with interest to the redemption date, shall be held by the Paying Agents so as to be available therefor on said date and if notice of redemption shall have been given as aforesaid, then, from and after the redemption date interest on the Bonds or portions thereof of so called for redemption shall cease to accrue and become payable. If said moneys shall not be so available on the redemption date, such Bonds or portions thereof shall continue to bear interest until paid at the same rate as they would have borne had they not been called for redemption. Upon the payment of the Redemption Price of and any accrued interest on the Bonds being redeemed, each check or other transfer of funds issued for such purpose shall bear the CUSIP number identifying, by maturity, the Bonds being redeemed with the proceeds of such check or other transfer. Section 4.10 Cancellation and Destruction of Bonds. All Bonds paid or redeemed, either at or before maturity shall be delivered to the Trustee when such payment or redemption is made, and such Bonds, together with all Bonds purchased or redeemed pursuant to Section 4.02(c) which have been delivered to the Trustee for application as a credit against Sinking Fund Installments and all Bonds purchased by the Trustee pursuant to the Written Direction of SCPPA, shall thereupon be promptly cancelled (or deemed to have been cancelled). Bonds so cancelled may, to the extent permitted by law, at any time be destroyed by the Trustee, who shall execute a certificate of destruction in duplicate by the signature of one of its authorized officers describing the Bonds so destroyed, and one executed certificate shall be filed with SCPPA and the other executed certificate shall be retained by the Trustee. Section 4.11 Reductions to Schedule II, Schedule IV and Sinking Fund Installments. Within 20 days after an extraordinary redemption pursuant to Section 4.01, SCPPA shall deliver to the Trustee the following: (i) revised schedules of Sinking Fund Installments to replace the schedules of Sinking Fund Installments pursuant to Section 4.02, with the Sinking Fund Installments for a maturity of a series being reduced on a pro rata basis (or such other basis specified in an Opinion of Bond Counsel in order to maintain the excludability of interest on any Bond from the gross income of the owner thereof for federal income tax purposes); (ii) a revised Schedule II to this Indenture; (iii) a revised Schedule IV to this Indenture; (iv) a Written Direction of SCPPA to substitute the schedules referred to above for the prior schedules (or any previously delivered schedules provided to the Trustee); and (v) an Accountant s Certificate to the effect that it has reviewed the schedules and statements of SCPPA so delivered to the Trustee and verified that, taking into account any revisions to the Gas Purchase Agreements, the Commodity Swaps, the Interest Rate Swap, Schedule II and Schedule IV: (a) Quarterly Cash Flow: the cumulative deposits specified by Schedule II and the minimum interest earnings accruals (including with respect to the then-current amount 34

63 invested in the Debt Service Account of the Debt Service Fund) (i) for each three-month period ending January 31, April 30, July 31 and October 31 is not less than the interest due on the Bonds on the immediately succeeding February 1, May 1, August 1 and November 1 and (ii) for each 12-month period ending October 31 is not less than, as applicable, the principal of and cumulative interest on the Bonds due on February 1, May 1 and August 1 immediately preceding such November 1 and the immediately succeeding November 1, determined in the case of both clause (i) and clause (ii) above as if the Bonds are not redeemed before their stated maturities; (b) Price Swap: the quantity of Gas to be sold and delivered to SCPPA pursuant to the Gas Purchase Agreements and by SCPPA to the Project Participants pursuant to the Gas Supply Contracts in each month is equal to the quantity specified for such month in the Commodity Swaps; and (c) Termination Payments: with respect to each Gas Purchase Agreement, the Termination Payment indicated in such Gas Purchase Agreement for each month, together with the applicable funds available under this Indenture, will be sufficient to pay the Redemption Price of the related Project Participant s share of the Bonds upon an Early Termination Payment Date with respect to such Gas Purchase Agreement. ARTICLE V Establishment of Funds and Application Thereof Section 5.01 The Pledge Effected by this Indenture. (a) The Bonds shall be limited, non-recourse obligations of SCPPA payable solely from, and secured as to the payment of the principal and Redemption Price thereof, and interest thereon, in accordance with their terms and the provisions of this Indenture solely by, the Trust Estate. The payment of the principal and Redemption Price of the Bonds, and interest thereon, is not an obligation of the Project Participants, whose obligations are limited to their obligations to SCPPA under the respective Gas Supply Contracts. The Trust Estate hereby pledged and assigned shall immediately be subject to the lien of this pledge without any further physical delivery thereof or other further act, and the lien of this pledge shall be a first lien and shall be valid and binding as against all parties having claims of any kind in tort, contract or otherwise against SCPPA, irrespective of whether such parties have notice thereof. (b) The Bonds do not constitute general debts, obligations or indebtedness of SCPPA, any Project Participant or any other member of SCPPA within the meaning of the Constitution of the State or statutes of the State, but are limited obligations of SCPPA payable solely from and secured by a lien on the Trust Estate, in the manner and to the extent provided for in this Indenture. No registered owner of the Bonds shall ever have the right to require or compel the exercise of the ad valorem taxing power of any Project Participant or any other member of SCPPA or the taxation in any form on any real or personal property to pay the principal or Redemption Price of or interest on the Bonds. Neither the full faith and credit nor the taxing power of the State, the Project Participants or any other member of SCPPA is pledged to the payment of the principal of, Redemption PremiumPrice, if any, or interest on the Bonds. 35

64 (c) Nothing contained in this Indenture shall be construed to prevent SCPPA (or any Project Participant) from acquiring, constructing or financing through the issuance of its bonds, notes or other evidences of indebtedness any facilities or supplies of gas other than the Gas Project, electric energy and power, oil, hydroelectric, nuclear, solar, geothermal, wind, coal or other liquid, gaseous, or solid hydrocarbon fuels, leasehold interests thereon, or other property; provided that such bonds, notes or other evidences of indebtedness shall not be payable out of or secured by the Trust Estate and neither the cost of any such power, energy, or other fuel or property nor any expenditure in connection therewith or with the financing thereof shall be payable from the Trust Estate. Section 5.02 Establishment of Funds and Accounts. (a) The following Funds, Accounts and Subaccounts to be held by the Trustee are hereby established: (i) Project Fund, consisting of the following Accounts: (a) (b) (c) Gas Project Account; Working Capital Account, consisting of the following Subaccounts: Anaheim Working Capital Subaccount; Burbank Working Capital Subaccount; Colton Working Capital Subaccount; Glendale Working Capital Subaccount; and Pasadena Working Capital Subaccount Remarketing Reserve Account (ii) Revenue Fund, consisting of the following Accounts: (a) (b) (c) (d) (e) Anaheim Revenue Account; Burbank Revenue Account; Colton Revenue Account; Glendale Revenue Account; and Pasadena Revenue Account (iii) Operating Fund, consisting of the following Accounts: (a) (b) Commodity Swaps Operating Account, consisting of the following Subaccounts: Anaheim Operating Subaccount; Burbank Operating Subaccount; Colton Operating Subaccount; Glendale Operating Subaccount; and Pasadena Operating Subaccount General Operating Account (iv) Debt Service Fund, consisting of the following Accounts: (a) (b) Debt Service Account; Redemption Account; and 36

65 (c) Debt Service Reserve Account, consisting of the following Subaccounts: Anaheim Debt Service Reserve Subaccount; Burbank Debt Service Reserve Subaccount; Colton Debt Service Reserve Subaccount; Glendale Debt Service Reserve Subaccount; and Pasadena Debt Service Reserve Subaccount (v) General Fund, consisting of the following Accounts: Anaheim General Account; Burbank General Account; Colton General Account; Glendale General Account; and Pasadena General Account (b) SCPPA may, by Supplemental Indenture, establish one or more additional accounts or subaccounts. Section 5.03 Project Fund. (a) There shall be established within the Project Fund the Gas Project Account. There shall beproceeds of the Bonds were paid into the Gas Project Account proceeds of the Bonds in the amount specified by Written Request of SCPPA, and there may be paid into the Gas Project Account, at the option of SCPPA, any moneys received for or in connection with the Gas Project by SCPPA from any other source, unless required to be otherwise applied as provided by this Indenture. Except as otherwise provided in this Section, amounts in the Gas Project Account have been and shall be applied by the Trustee to pay the Cost of Acquisition, pursuant to a Written Direction of SCPPA. (b) There shall be established within the Project Fund a Working Capital Account, into which the Trustee shall depositdeposited proceeds of the Bonds in an amount equal to $9,613,000. The initial balance shall bewas deposited into the Subaccounts of the Working Capital Account as set forth in Schedule VI. Except as otherwise provided in this Section 5.03(b), amounts credited to a Subaccount bearing the name of a given Project Participant in the Working Capital Account shall be applied from time to time by the Trustee at the Written Direction of SCPPA solely to the payment of Commodity Swap Payments relating to such Project Participant in the event amounts on deposit in the related Subaccount bearing such Project Participant s name in the Commodity Swaps Operating Account are not sufficient to make such payments; provided that any amounts in a Subaccount in the Working Capital Account in excess of the applicable amount set forth above in Schedule VI shall be transferred to the related Account in the Revenue Fund bearing such Project Participant s name; and provided further that any amounts remaining on deposit in the Working Capital Account on the final date for payment of the principal of the Bonds, whether upon maturity, redemption or acceleration, shall be applied to make such payment and to pay any Interest Rate Swap Payment. In the event of an extraordinary redemption of Bonds as a result of an early termination of a Gas Purchase Agreement, the amount on deposit in the related Subaccount bearing the name of the applicable Project Participant in the Working Capital Account shall be transferred to the Redemption Account by the Trustee no later than the Business Day next preceding the redemption date for 37

66 the Bonds. In the event of an extraordinary redemption of Bonds as a result of a Remarketing Default as described in Section 4.01 with respect to a Project Participant, a pro rata portion of the amount on deposit in the related Subaccount of the Working Capital Account (subject to, and as discussed in, the following sentence) shall be transferred by the Trustee no later than the Business Day next preceding the redemption date for the Bonds. Notwithstanding the foregoing, prior to the transfer of moneys from a Working Capital Subaccount to the Redemption Account pursuant to the preceding sentence, SCPPA shall first provide to the Trustee an Accountant s Certificate that the proposed amount to be transferred (or such lesser amount as determined by the Accountant) shall not result in a decrease in (i) the ratio of the amount in such Working Capital Subaccount at the time the Bonds were issued and the amount of the applicable Project Participant s Daily Contract Quantity for a calendar year or (ii) the ratio of the amount in such Working Capital Subaccount immediately following such redemption and the applicable Project Participant s Daily Contract Quantity for a future calendar year following such redemption. Immediately following such transfer to the Redemption Account, SCPPA shall promptly provide a revised Schedule VI to the Trustee for replacement of the prior Schedule VI. Allocations of the sources and uses of amounts on deposit from time to time in the Working Capital Account shall be made in accordance with the Tax Agreement. The foregoing to the contrary notwithstanding, in the event the Commodity Swaps are no longer existing and in place, all accrued and unpaid amounts under the Commodity Swaps have been paid, and SCPPA determines that it has no obligation to replace the Commodity Swaps pursuant to Section 2.03, amounts on deposit in the Working Capital Account and the Commodity Swaps Operating Account shall be transferred to the Debt Service Account to pay principal and interest on Bonds and any Interest Rate Swap Payment coming due as directed by SCPPA. (c) There shall be established within the Project Fund a Remarketing Reserve Account. There shall be paid into the Remarketing Reserve Account, pursuant to a Written Direction of SCPPA, (i) the amounts specified in Section 7.4(d) of the Gas Purchase Agreements, (ii) with respect to Gas delivered to SCPPA under a Gas Purchase Agreement, any amounts received by SCPPA or a Project Participant from the sale of such Gas in any Non- Service Area Sale or Fully Disqualified Sale in excess of the amount SCPPA or such Project Participant, as applicable, would have received for the same quantity of Gas at the Net Participant Price and (iii) additional amounts, if any, as specified in Section 3.4 of the Gas Supply Contracts and Section 7.3(c)(iv) of the Gas Purchase Agreements. In the case of a purchase and remarketing of Gas under Section 7.3(c)(ii) of a Gas Purchase Agreement to remediate a Non-Service Area Sale or Fully Disqualified Sale, the Trustee shall release amounts from the Remarketing Reserve Account upon such remarketing and, pursuant to a Written Direction of SCPPA, shall apply such amounts as follows: (i) if the purchase and remarketing are undertaken by SCPPA itself, then the portion of the Remarketing Reserve Account allocable to such remarketing shall be transferred to the General Fund and, unless otherwise directed in writing by SCPPA, deposited into the Accounts within the General Fund based upon the respective Gas Entitlement Shares; (ii) if the purchase and remarketing are undertaken by a Project Participant, then the portion of the Remarketing Reserve Account allocable to such remarketing shall be paid to such Project Participant; and (iii) if the purchase and remarketing are undertaken by the Gas Supplier on behalf of SCPPA, then (a) if the proceeds received by SCPPA from the remarketing equal or exceed the Remarketing Purchase Price, then the portion of the Remarketing Reserve Account allocable to such remarketing shall be transferred to the General Fund and, unless otherwise directed in writing by SCPPA, deposited into the Accounts 38

67 within the General Fund based upon the respective Gas Entitlement Shares, and (b) if the proceeds received by SCPPA from the remarketing are less than the Remarketing Purchase Price, then the portion of the Remarketing Reserve Account allocable to such remarketing shall be used (aa) to make a payment to the Gas Supplier in an amount equal to the excess of such Remarketing Purchase Price over such proceeds received by SCPPA from the remarketing, and (bb) any remaining amounts allocable to such remarketing after payment to the Gas Supplier referenced in (aa) shall be transferred to the General Fund and, unless otherwise directed in writing by SCPPA, deposited into the Accounts within the General Fund based upon the respective Gas Entitlement Shares. For purposes of this Section 5.03(c), the portion of the Remarketing Reserve Account allocable to a remarketing shall consist of the product of: (i) a fraction, the numerator of which is the Remarketing Purchase Price (or, in the case of a purchase and remarketing undertaken by SCPPA itself or by a Project Participant, the Purchase Price) for the Gas to be remarketed, and the denominator of which is the aggregate amount previously received by SCPPA or a Project Participant, with respect to Gas delivered to SCPPA under a Gas Purchase Agreement, from any sale of such Gas in a Non-Service Area Sale or Fully Disqualified Sale that, as of the time of the remarketing, has not been remediated in accordance with Section 7.3(c)(ii) of a Gas Purchase Agreement, multiplied by (ii) the balance of the Remarketing Reserve Account at the time of the remarketing. In addition, upon any extraordinary redemption of all Bonds, in whole, or upon the final maturity date of the Bonds, amounts on deposit in the Remarketing Reserve Account shall be deposited in the Debt Service Account and applied to payment of the principal of and interest on the Bonds and to pay any Interest Rate Swap Payment due. (d) Proceeds of insurance (other than the Surety Bonds) maintained pursuant hereto with respect to the Gas Project shall be paid into the Gas Project Account in the Project Fund. (e) Before any payment is made by the Trustee from the Gas Project Account, SCPPA shall file with the Trustee a Written Request of SCPPA, showing with respect to each payment to be made, the name of the Person to whom payment is due and the amount to be paid, and stating that the obligation to be paid was incurred and is a proper charge against the Project Fund (or the Gas Project Account therein). To the extent that the Written Request includes amounts to be paid pursuant to the Gas Purchase Agreements, copies of the invoices or requests for direct payments submitted under the Gas Purchase Agreements shall be attached to the Written Request. Each such Written Request shall be sufficient evidence to the Trustee: (i) that obligations in the stated amounts have been incurred by SCPPA and that each item thereof is a proper charge against the Project Fund or the Gas Project Account therein; and (ii) that there has not been filed with or served upon SCPPA notice of any lien, right to lien or attachment upon, or claim affecting the right to receive payment of, any of the moneys payable to any of the Persons named in such Written Request which has not been released or will not be released simultaneously with the payment of such obligation other than materialmen s or mechanics liens accruing by mere operation of law. (f) Upon receipt of each such Written Request, the Trustee shall pay the amounts set forth therein as directed by the terms thereof. 39

68 (g) Notwithstanding any of the other provisions of this Section, to the extent that other moneys under this Indenture are not available therefor, amounts in the Gas Project Account shall be applied, without preference or priority, to the payment of principal of and interest on Bonds when due and to the payment of Interest Rate Swap Payments when due. (h) Upon Written Direction of SCPPA, but not earlier than six (6) months after the date of delivery of the Bonds, the Trustee shall transfer to the General Operating Account in the Operating Fund any amounts remaining on deposit in the Gas Project Account of the Project Fund. (i) Call Option. (A) In the event that, on any Business Day, the Trustee determines that, after taking into account amounts to be transferred into the Operating Fund pursuant to Section 5.05(a)(i), the amount on deposit in either of the Anaheim Operating Subaccount or the Glendale Operating Subaccount, together with the amount on deposit in such Project Participant s subaccount of the Working Capital Account, is insufficient to pay any portion of the next succeeding Commodity Swap Payment payable with respect to such Project Participant, the Trustee shall prepare and deliver to the Gas Supplier a Call Receivables Offer (as defined in Section 4.1(a) of the Receivables Purchase Agreement) pursuant to Section 4.1(a) of the Receivables Purchase Agreement for the receivables then-payable by the related Project Participant up to the amount of such insufficiency. If the Gas Supplier elects to purchase such receivables pursuant to such Call Receivables Offer, which election shall not be later than the Business Day following receipt by the Gas Supplier of the Call Receivables Offer, the Gas Supplier shall deliver to the Trustee a Call Option Notice (as defined in Section 4.1(b) of the Receivables Purchase Agreement) setting forth the purchase date, which shall not be later than the Purchase Date (as defined in the Confirmations to the Commodity Swap) of the Month in which the Call Receivables Offer was delivered. The Trustee is hereby authorized and directed to sell the net receivables then owed by the Project Participants under the Gas Supply Contracts pursuant to the Receivables Purchase Agreement (as contemplated by this Section) and to take all actions on its part necessary in connection therewith. If the Gas Supplier elects to purchase any net receivables, all amounts received by the Trustee pursuant to the Receivables Purchase Agreement in respect to receivables purchased pursuant to this Section 5.03(i) shall be deposited in the applicable subaccounts of the Commodity Swaps Operating Account and applied to payment of Commodity Swap Payments on the applicable Commodity Swaps. (B) Within one Business Day after the Gas Supplier delivers a Call Option Notice or is deemed not to have exercised its purchase right pursuant the Receivables Purchase Agreement, the Trustee shall deliver written notice to the Commodity Swap Counterparty indicating whether the Gas Supplier has elected to purchase receivables pursuant to the Call Receivables Offer sufficient to increase the balance in the related subaccounts of the Commodity Swaps Operating Account and the Working Capital Account to an amount sufficient to pay the next succeeding Commodity Swap Payment with respect to the related Project Participant. (C) The Trustee shall deliver to U.S. Bank National Association, as custodian, pursuant to the Custodial Agreement, dated as of July [ ], 2013, among the Trustee, U.S. Bank National Association, as custodian, the Gas 40

69 Supplier and the Commodity Swap Counterparty, written notice as follows: (i) on any Business Day on which the Trustee delivers a Call Receivables Offer to the Gas Supplier pursuant to Section 4.1(a) of the Receivables Purchase Agreement, written notice that a swap payment deficiency exists and the amount of such deficiency; (ii) on any Business Day on which the Gas Supplier is required to make an election to purchase Call Receivables (as defined in the Receivables Purchase Agreement) pursuant to Section 4.1(b) of the Receivables Purchase Agreement, written notice as to whether the Gas Supplier has elected to purchase such Call Receivables and, if so, the purchase date of such Call Receivables; and (iii) if the Gas Supplier has elected to purchase Call Receivables, on the purchase date thereof written notice that the purchase price has been received by the Trustee in immediately available funds. (D) If the Gas Supplier does not elect to purchase Call Receivables due from the City of Anaheim, California or the City of Glendale, California pursuant to a Call Receivables Offer, then the Trustee shall give prompt written notice to the Holders of the Bonds of its intent to designate an Early Termination Date with respect to the relevant Gas Purchase Agreement pursuant to a Buyer Non-Default Termination Event described in Sections 17.3(b)(ix) thereof. Unless the Trustee is directed not to do so by the Holders of 75% in principal amount of the Bonds, excluding from the numerator and denominator of such percentage calculation any Bonds owned by the Commodity Swap Counterparty or the Gas Supplier or any of their respective Affiliates, within 20 days after such notice is delivered by the Trustee, the Trustee shall designate an Early Termination Date with respect to the relevant Gas Purchase Agreement. (j) Put Option. In the event that, on any Business Day, the Trustee determines that, after taking into account amounts to be transferred into the Operating Fund pursuant to Section 5.05(a)(i), the amount on deposit in any of the Burbank Operating Subaccount, the Colton Operating Subaccount or the Pasadena Operating Subaccount, together with the amount on deposit in the Burbank Working Capital Subaccount, the Colton Working Capital Subaccount, or the Pasadena Working Capital Subaccount, respectively, is insufficient to pay any portion of the next succeeding Commodity Swap Payment payable with respect to the related Project Participant, (i) the Trustee shall give notice of the same to SCPPA and SCPPA shall notify the Trustee of the net receivables then owed by such Project Participant under the related Gas Supply Contract, (ii) the Trustee shall prepare and deliver to the Gas Supplier the Put Option Notice (as defined in the Receivables Purchase Agreement) pursuant to Section 2.1(c) of the Receivables Purchase Agreement, and (iii) the first Business Day following the delivery of the Put Option Notice, the Trustee shall deliver to the Gas Supplier the bill of sale and certificate required by Sections 2.2(a) and 2.2(b) of the Receivables Purchase Agreement, and SCPPA shall deliver to the Gas Supplier the certificate required by Section 2.2(c) of the Receivables Purchase Agreement. The Trustee shall deposit into the Subaccount within the Commodity Swaps Operating Account bearing the name of the applicable Project Participant all amounts received by it pursuant to the Receivables Purchase Agreement in respect of such Put Option Notice. Such amounts deposited into such Subaccount shall be applied to pay the Commodity Swap Payment then due with respect to the related Project Participant. 41

70 Section 5.04 Revenues and Revenue Fund. (a) All Revenues, except any Interest Rate Swap Receipts (which shall be deposited directly into the Debt Service Account) and any Termination Payment (which shall be deposited directly into the Redemption Account of the Debt Service Fund), shall be deposited promptly by the Trustee upon receipt thereof into the Revenue Fund, excluding amounts required by Section 5.03(c) to be deposited into the Remarketing Reserve Account. Except as provided in the preceding sentence, the Trustee promptly shall deposit into the Revenue Account bearing the name of a given Project Participant the following Revenues: (i) with respect to clause (a) in the definition of Revenues, all Revenues received by or on behalf of such Project Participant pursuant to its Gas Supply Contract, including amounts received under subsection (b) below on behalf of such Project Participant; (ii) with respect to clause (b) in the definition of Revenues, except as otherwise provided in Section 5.03(d), a proportionate amount of such insurance proceeds based upon the Project Participant s Gas Entitlement Share; (iii) with respect to clause (c) in the definition of Revenues, all interest received by each Account or Subaccount bearing the name of such Project Participant; and (iv) with respect to clause (d) in the definition of Revenues, any Commodity Swap Receipts (and any payments under the related guaranty) applicable to the Commodity Swap relating to such Project Participant. If any payment is not made into any Revenue Account of the Revenue Fund when due, immediate notice shall be given to SCPPA by the Trustee. For the avoidance of doubt, Monthly Administration Fees are not Revenues, and shall be paid, as received, directly to SCPPA. (b) In the event SCPPA receives notice that a Commodity Swap is subject to termination due to a payment default by SCPPA and, on the Business Day of such notice, the Trustee determines that the balance in the Subaccount of the Working Capital Account bearing the name of any Project Participant is less than the amount set forth for in Schedule VI for such Subaccount (as such amount may be reduced pursuant to Section 5.03(b)), (i) the Trustee shall give notice of the same to SCPPA and SCPPA shall notify the Trustee of the net receivables then owed by such Project Participant under the related Gas Supply Contract, (ii) the Trustee shall prepare and deliver to the Gas Supplier the Put Option Notice (as defined in the Receivables Purchase Agreement) pursuant to Section 2.1(c) of the Receivables Purchase Agreement, and (iii) the first Business Day following the delivery of the Put Option Notice, the Trustee shall deliver to the Gas Supplier the bill of sale and certificate required by Sections 2.2(a) and 2.2(b) of the Receivables Purchase Agreement, and SCPPA shall deliver to the Gas Supplier the certificate required by Section 2.2(c) of the Receivables Purchase Agreement. The Trustee shall deposit into the Revenue Fund all amounts subsequently received pursuant to the Receivables Purchase Agreement. Amounts deposited into the Revenue Fund shall be applied in accordance with this Article V. Section 5.05 Payments into Certain Funds. (a) In each Month during which there is a deposit of Revenues into the Revenue Fund (but in no case later than the respective dates set forth below), the Trustee from the Revenue Account therein related to a given Project Participant, (x) shall pay to the Surety Provider in immediately available funds, from and to the extent of any deposit in such Month of Revenues received by or for the account of SCPPA under the related Gas Supply Contract, in an amount equal to the lesser of (A) the amount then payable, if any, by SCPPA from moneys in such Account to the Surety Provider under the related Financial Guaranty Agreement and (B) the total amount by which the Surety Bond Coverage will 42

71 increase as a result of such payment, and (y) to the extent of any balance of the deposits in such Month, shall credit to the following Funds and Accounts (in the following order) the amounts set forth below (such application to be made in such a manner so as to assure good funds in such Funds and Accounts on the respective dates set forth below): (i) From the Revenue Fund Account related to a given Project Participant, (A) first to the credit of its Commodity Swaps Operating Subaccount in the Operating Fund and the General Operating Account, respectively, without preference or priority (and pro rata by such Subaccount or Account if sufficient amounts do not exist), not later than the 24th day of such Month, to (a) such Subaccount in the Commodity Swaps Operating AccountSubaccount related to such Project Participant, the amount, if any, required so that the balance credited thereto shall equal the amount estimated to be necessary for such Subaccount for the payment of Commodity Swap Payments in respect of such Project Participant coming due or payable for such Month (but no such Payments or expenses for any prior Month) and (B) second to the credit of the General Operating Account, such Project Participant s share (determined in proportion to its respective Gas Entitlement Share), of the amount, if any, required so that the total amounts deposited in the General Operating Account shall equal the amount estimated to be necessary for the payment of all other Operating Expenses coming due for the following Month (but no other Operating Expenses or payments for any prior Month); provided, however, that notwithstanding anything to the contrary in this Indenture, for a period not extending beyond August 1, 2008, the Trustee, after crediting amounts pursuant to clauses (ii), (iii) and (iv) below, shall transfer any remaining Revenues to the General Operating Account until the total amount so transferred equals $200,000 or such lesser amount as an Authorized Authority Representative shall notify the Trustee in writing; (ii) From the Revenue Fund Account related to a given Project Participant, to the Debt Service Fund, not later than the last Business Day of such Month for the credit to the Debt Service Account, an amount equal to the greater of (1) such Project Participant s proportionate share (based upon its applicable monthly Gas Entitlement Share) of the Scheduled Debt Service Deposit for such Business Day, as set forth in Schedule II hereto or (2) such Project Participant s proportionate share (based upon its Gas Entitlement Share) of the amount necessary to cause the cumulative Scheduled Debt Service Deposits for the dates referenced in Schedule II hereto to be on deposit therein (without credit for undisbursed Interest Rate Swap Receipts deposited thereto and, in computing the amount to be deposited into the Debt Service Account, there shall be excluded from the required deposit the amount, if any, set aside therein from the proceeds of the Bonds, including amounts, if any, transferred thereto from the Project Fund, for the payment of interest on the Bonds or Interest Rate Swap Payments); notwithstanding the foregoing, if on the Business Day prior to an Interest Payment Date the amount in the Debt Service Fund is not sufficient to make, without preference or priority, the Debt Service payments on the Bonds and the Interest Rate Swap Payment due on the next Interest Payment Date, then into the Debt Service Fund an amount, based upon such Project Participant s Gas Entitlement Share, so that the amounts on deposit therein are sufficient to make such payments; 43

72 (iii) From the Revenue Fund Account related to a given Project Participant, to its Working Capital Subaccount in the Project Fund, not later than the last Business Day of such Month, the amount, if any, required so that the balance in such Working Capital Subaccount is at least equal to the applicable amount for such Subaccount as set forth in Schedule VI (as such Schedule may be reduced pursuant to Section 5.03(b)); provided, however, in the event the Commodity Swaps are no longer existing and in place, all accrued and unpaid amounts under the Commodity Swaps have been paid, and SCPPA determines that is has no obligation to replace the Commodity SwapSwaps pursuant to Section 2.03, deposits to the Working Capital Account will not be required; and (iv) From the Revenue Fund Account related to a given Project Participant, to the Debt Service Fund, not later than the last Business Day of such Month, for deposit in the Debt Service Reserve Subaccount relating to such Project Participant in the Debt Service Reserve Account, the amount, if any, required so that the balance in such Subaccount in the Debt Service Reserve Account shall equal the amount for such Subaccount set forth in Section 5.09(a) as of the last day of the then current Month (giving credit to the Surety Bond Coverage for such Subaccount, including any increase thereof to result from any prior payment to the Surety Provider) or to reimburse the Surety Provider for previously unreimbursed amounts drawn under the Surety Bond relating to such Project Participant. Following the transfer required by Section 5.05(a)(ii), the Trustee as of the date of such transfer shall determine whether an amount equal to the cumulative Scheduled Debt Service Deposits is on deposit in the Debt Service Account. If such amount is not on deposit, the Trustee shall give immediate notice of the deficiency to SCPPA pursuant to Section 7.11(b). (b) Following each Principal Installment payment date, after making such transfers, credits and deposits as required by paragraph (a) above, the TrusteeSCPPA shall first, to the extent available funds remain in any Revenue Fund Account related to a Project Participant, transfer such amount, if any, to the Working Capital Account Subaccount bearing the name of such Project Participant as is necessary to cause the amount set forth for such Project Participant on Schedule VI to be on deposit therein, and second, repurchase Identified Receivables of such Project Participant then held by the Gas Supplier pursuant to the Receivables Purchase Agreement, then, to the extent of any amounts in such Account, SCPPA shall pay any RPA Accrued Interest applicable to the purchase of such Project Participant s Identified Receivables to the Gas Supplier pursuant to the Receivables Purchase Agreement, and then SCPPA shall credit to the General Fund, from the Revenue Fund Account relating to a giveneach Project Participant, any amount remaining in such Revenue Account to the Account in the General Fund bearing such Project Participant s name. (c) So long as there shall be held in the Debt Service Fund an amount sufficient to pay in full all Outstanding Bonds in accordance with their terms (including principal or applicable sinking fund Redemption Price and interest thereon) and all Interest Rate Swap Payments, no transfers shall be required to be made to the Debt Service Fund. 44

73 (d) Service Account. Section 5.06 Interest Rate Swap Receipts shall be deposited directly into the Debt Operating Fund. (a) Amounts credited to a Commodity Swaps Operating Account with respect to a given Project Participant shall be applied from time to time by the Trustee to the payment of Commodity Swap Payments due with respect to the related Commodity Swap. (b) Amounts credited to the General Operating Account shall be used to pay all Operating Expenses other than Commodity Swap Payments, pursuant to a Written Direction of SCPPA. (c) Amounts credited to a Subaccount in the Commodity Swaps Operating Account with respect to a given Project Participant which SCPPA at any time determines to be in excess of the requirements of such Subaccount shall be applied to make up any deficiencies caused by such Project Participant, first in the Debt Service Account, then in the Subaccount of the Working Capital Account relating to such Project Participant and then in the Subaccount of the Debt Service Reserve Account relating to such Project Participant. Any balance of such excess not required to be so applied shall be transferred to the Account in the Revenue Fund relating to such Project Participant for application in accordance with Section 5.05(a). (d) Amounts credited to the General Operating Account which SCPPA at any time determines to be in excess of the requirements of such Account shall be applied, in each case based upon the respective Gas Entitlement Shares, to make up any deficiencies in the Debt Service Account, then in the Subaccounts of the Working Capital Account and then in the Subaccounts of the Debt Service Reserve Account. Any balance of such excess not required to be so applied shall be transferred to the Accounts in the Revenue Fund (and deposited into such Accounts based upon the respective Gas Entitlement Shares) for application in accordance with Section 5.05(a). Section 5.07 Debt Service Fund Debt Service Account. (a) The amounts deposited into the Debt Service Account pursuant to Section 5.05(a)(ii) shall be held in such Account and applied on each Bond Payment Date to the payment, without preference or priority, of (i) Debt Service payable on such Bond Payment Date and (ii) Interest Rate Swap Payments then due. The amounts deposited into the Debt Service Account pursuant to Section 5.05(a)(ii) shall be invested initially in a repurchase agreement, guaranteed investment contract or similar agreement providing for a specific rate of return as provided in clause (d) or (e) of the definition of Qualified Investments. Any investment in the Debt Service Account may be replaced with another Qualified Investment upon the delivery to the Trustee of a Rating Confirmation; provided, however, that SCPPA shall use its best efforts to replace any such Qualified Investment with a Qualified Investment described in clause (d) or (e) of the definition of Qualified Investments. (b) The Trustee shall pay out of the Debt Service Account to the Paying Agent (i) on or before each Interest Payment Date, the amount required for the interest payable on the Bonds on such date; (ii) on or before each Bond Payment Date on which a Principal 45

74 Installment is due, the amount required for the Principal Installment payable on such date; and (iii) on or before any other redemption date, the amount required for the payment of the accrued interest on such Bonds then to be redeemed; provided, however, that if any Bonds or portions thereof are due on any Bond Payment Date and/or redemption date are intended to be paid from a source other than amounts in the Debt Service Account prior to any application of amounts in the Debt Service Account to such payments, then the Trustee (after written notice from SCPPA to the Trustee that SCPPA intends to make payments from a source other than amounts in the Debt Service Account) shall not pay any such amounts to the Paying Agent until amounts have failed to be provided from such other source at the time required and if any such amounts due are paid from such other source the Trustee shall apply the amounts in the Debt Service Account to provide reimbursement for such payment from such other source as provided in the agreement governing reimbursement of such amounts to such other source. Such amounts shall be applied by the Paying Agent on and after the due dates thereof. The Trustee shall also pay out of the Debt Service Account the accrued interest included in the purchase price of Bonds purchased for retirement. (c) Amounts accumulated in the Debt Service Account with respect to any Sinking Fund Installment (together with amounts accumulated therein with respect to interest on the Bonds for which such Sinking Fund Installment was established) shall, if so directed by SCPPA in a Written Request delivered not less than 30 days before the due date of a Sinking Fund Installment, be applied by the Trustee to (i) the purchase of Bonds of the series and maturity for which the Sinking Fund Installment was established, (ii) the redemption at the applicable sinking fund Redemption Price of such Bonds, if then redeemable by their terms, or (iii) any combination of (i) and (ii). All purchases of any Bonds pursuant to this subsection (c) shall be made at prices not exceeding the applicable sinking fund Redemption Price of such Bonds plus accrued interest, and such purchases shall be made in such manner as SCPPA shall direct the Trustee. The applicable sinking fund Redemption Price (or principal amount of maturing Bonds) of any Bonds so purchased or redeemed shall be deemed to constitute part of the Debt Service Account until such Sinking Fund Installment date, for the purpose of calculating the amount of such Account. At least 30 days preceding the due date of any such Sinking Fund Installment, the Trustee shall proceed to call for redemption on such due date, by giving notice as required by this Indenture, Bonds of the series and maturity for which such Sinking Fund Installment was established (except in the case of Bonds maturing on a Sinking Fund Installment date) in such amount as shall be necessary to complete the retirement of the unsatisfied balance of such Sinking Fund Installment after making allowance for any such Bonds purchased or redeemed pursuant to Section 5.10 which SCPPA has directed the Trustee to apply as a credit against such Sinking Fund Installment as provided in Section 4.02(c). The Trustee shall pay out of the Debt Service Account to the Paying Agent, on or before such redemption date (or maturity date), the amount required for the redemption of the Bonds so called for redemption (or for the payment of such Bonds then maturing), and such amount shall be applied by such Paying Agents to such redemption (or payment). All expenses in connection with the purchase or redemption of Bonds shall be paid by SCPPA from the Operating Fund. All Bonds paid or redeemed, either at or before maturity, shall be delivered to the Trustee when such payment or redemption is made, and such Bonds, together with all Bonds purchased or redeemed, pursuant to Section 5.10 which have been delivered to the Trustee for application 46

75 as a credit against Sinking Fund Installments and all Bonds purchased by the Trustee, shall thereupon be promptly cancelled (or deemed to have been cancelled). (d) Amounts accumulated in the Debt Service Account with respect to any principal amount of Bonds due on a certain future date for which no Sinking Fund Installments have been established (together with amounts accumulated therein with respect to interest on such Bonds) shall be applied by the Trustee, upon the written direction of SCPPA, on or prior to the due date thereof, to (i) the purchase of such Bonds or (ii) the redemption at the principal amount of such Bonds, if then redeemable by their terms. All purchases of any Bonds pursuant to this subsection (d) shall be made at prices not exceeding the principal amount of such Bonds plus accrued interest, and such purchases shall be made in such manner as SCPPA shall determine. The principal amount of any Bonds so purchased or redeemed shall be deemed to constitute part of the Debt Service Account until such due date, for the purpose of calculating the amount of such Account. (e) The amount, if any, deposited in the Gas Project Account from the proceeds of the Bonds for the payment of capitalized interest shall be credited to the Debt Service Account and applied to the payment of interest on the Bonds and the Interest Rate Swap Payments. (f) In the event of the defeasance of any Bonds, the Trustee shall, if directed by SCPPA in writing, withdraw from the Debt Service Account all, or any portion of, the amounts accumulated therein with respect to Debt Service on the Bonds being defeased and deposit such amounts with the Trustee to be held for the payment of the principal or Redemption Price, if applicable, and interest on the Bonds being defeased; provided that such withdrawal shall not be made unless immediately thereafter Bonds being defeased shall be deemed to have been paid pursuant to Section 12.01(b). In the event of such defeasance, SCPPA may direct the Trustee to withdraw from the Debt Service Account all, or any portion of, the amounts accumulated therein with respect to Debt Service on the Bonds being defeased and deposit such amounts in any Fund or Account hereunder; provided, however, that such withdrawal shall not be made unless the Bonds being defeased shall be deemed to have been paid pursuant to Section 12.01(b) and provided, further, that, at the time of such withdrawal, there shall exist no deficiency in any Fund or Account held hereunder. (g) Any amount remaining in the Debt Service Account after a date for payment of a Principal Installment shall, to the extent not required to be retained therein for purposes of making future payments, be deposited in the Revenue Fund and applied to the Accounts therein (based upon respective Gas Entitlement Shares). (h) In the event that, on the second Business Day prior to the earlier of (x) November 1, 2035, or (y) the final maturity date of or the final date for redemption of the Bonds (referred to herein as the Put Option Date ), the Trustee determines that the balance in the Working Capital Account is less than the aggregate amounts set forth on Schedule VI (prior to taking into account any transfer contemplated by the last sentence of Section 5.03(b)) and sufficient funds will not be available (after taking into account the transfer to the Debt Service Account authorized to be made pursuant to SectionsSection 5.03(b) to pay debt service on or after the Put Option Date) to pay the aggregate principal of and interest on the Bonds due on or 47

76 after the Put Option Date, (i) the Trustee shall give notice of the same to SCPPA and SCPPA shall notify the Trustee of the net receivables then owed by the Project Participants under the Gas Supply Contracts, (ii) the Trustee shall prepare and deliver to the Gas Supplier the Put Option Notice (as defined in Section 2.1(a) of the Receivables Purchase Agreement) pursuant to Section 2.1(b) of the Receivables Purchase Agreement, and (iii) on or before the Business Day next preceding the Put Option Date, the Trustee shall deliver to the Gas Supplier the bill of sale and certificate required by Sections 2.2(a) and (b) of the Receivables Purchase Agreement, and SCPPA shall deliver to the Gas Supplier the certificate required by Section 2.2(c) of the Receivables Purchase Agreement. The Trustee is hereby authorized to sell the net receivables then owed by the Project Participants under the Gas Supply Contracts pursuant to the Receivables Purchase Agreement (as contemplated by this Section) and to take all actions on its part necessary in connection therewith. All amounts subsequently received pursuant to the Receivables Purchase Agreement shall be deposited in the Debt Service Account and applied to payment of principal of and interest on the Bonds andon the final maturity or date for redemption thereof and to pay any Interest Rate Swap Payment due on or after the Put Option Date. Section 5.08 Debt Service Fund Redemption Account. (a) In the event of an early termination of a Gas Purchase Agreement, the Gas Supplier shall pay the Termination Payment thereunder directly to the Trustee for the account of SCPPA, and the Trustee shall deposit such Termination Payment into the Redemption Account. In the event that, on the Business Day next preceding the resulting Early Termination Payment Date or the final date for payment of the Bonds, as applicable, the Trustee determines that the balance in the Subaccount of the Working Capital Account bearing the name of the related Project Participant is less than the amount set forth for in Schedule VI for such Subaccount (as such amount may be reduced pursuant to Section 5.03(b)) and sufficient funds will not be available to pay the principal or Redemption Price of and interest on the Bonds coming due on the redemption date of the Bonds resulting from such Early Termination Date or final payment date, (i) the Trustee shall give notice of the same to SCPPA and SCPPA shall notify the Trustee of the net receivables then owed by such Project Participant under the related Gas Supply Contract, (ii) the Trustee shall prepare and deliver to the Gas Supplier the Put Option Notice pursuant to Section 2.1(a) of the Receivables Purchase Agreement, and (iii) on or before the Business Day next preceding the redemption date or date for final payment of the Bonds, the Trustee shall deliver to the Gas Supplier the bill of sale and certificate required by Sections 2.2(a) and 2.2(b) of the Receivables Purchase Agreement, and SCPPA shall deliver to the Gas Supplier the certificate required by Section 2.2(c) of the Receivables Purchase Agreement. The Trustee shall deposit into the Redemption Account all amounts subsequently received pursuant to the Receivables Purchase Agreement. Amounts deposited into the Redemption Account shall be applied by the Trustee to the payment of the Redemption Price of and interest on the Bonds pursuant to Section (b) Any amounts remaining on deposit in the Redemption Account following the redemption and payment of all Outstanding Bonds shall, upon Written Direction of SCPPA to the Trustee, be transferred to the Accounts in the Revenue Fund (and deposited into such Accounts based upon the respective Gas Entitlement Shares or as otherwise directed by SCPPA). 48

77 Section 5.09 Debt Service Fund Debt Service Reserve Account. (a) There shall be depositedmaintained on deposit in the Debt Service Reserve Account a Surety Bond intoin each Subaccount thereof, the aggregate Surety Bond Coverage of which shall equal the Debt Service Reserve Requirement. The applicable Surety Bond may be drawn only in the event of a failure by the related Project Participant to pay amounts due to SCPPA under its Gas Supply Contract. The Surety Bond Coverage for each Subaccount shall be as follows: Surety Bond Coverage Anaheim Debt Service Reserve Subaccount: $4,139,459 Burbank Debt Service Reserve Subaccount: 4,139,459 Colton Debt Service Reserve Subaccount: 2,587,163 Glendale Debt Service Reserve Subaccount: 5,174,324 Pasadena Debt Service Reserve Subaccount: 3,104,595 (b) No Commodity Swap Counterparty shall have any claim upon the amounts on deposit in the Debt Service Reserve Account and no Commodity Swap Payments shall be made from the Debt Service Reserve Account. (c) If a Project Participant fails to make payment under its Gas Supply Contract when due to SCPPA and such nonpayment results in insufficient moneys being available in the related Account of the Revenue Fund for transfer to the Debt Service Account pursuant to Section 5.05(a)(ii), then by 1:00 p.m. New York City time at least two Business Days before the last day for the credit of funds to the Debt Service Account pursuant to Section 5.05(a)(ii), following such nonpayment SCPPA shall give notice to the Trustee of the identity of the defaulting Project Participant and the amount of the nonpayment. Upon receipt of such notice, the Trustee shall draw upon the related Surety Bond and deposit into the Debt Service Account an amount equal to the amount of such insufficiency. The Trustee shall deliver a demand for payment to the Surety Provider in accordance with the terms and conditions of the related Surety Bond not less than two days prior to the last Business Day of the then-current Month and shall give prompt written notice to SCPPA of each such draw. (d) To the extent the Surety Provider fails to pay any amount due under and in accordance with a Surety Bond after a demand for payment has been made under Section 5.09(c) in respect of a Project Participant payment failure by the City of Burbank, California, the City of Colton, California, or the City of Pasadena, California, then (i) the Trustee shall give notice of the same to SCPPA and SCPPA shall notify the Trustee of the net receivables then owed by such Project Participant under the related Gas Supply Contract, (ii) the Trustee shall prepare and deliver to the Gas Supplier a Put Option Notice (as defined in the Receivables Purchase Agreement) pursuant to Section 2.1(d) of the Receivables Purchase Agreement, and (iii) the first Business Day following the delivery of the Put Option Notice, the Trustee shall deliver to the Gas Supplier the bill of sale and certificate required by Sections 2.2(a) and 2.2(b) of the Receivables Purchase Agreement, and SCPPA shall deliver to the Gas Supplier the certificate required by Section 2.2(c) of the Receivables Purchase Agreement. The Trustee shall deposit into the Subaccount of the Debt Service Account related to such Project Participant all amounts 49

78 subsequently received from the Surety Provider in connection with such Put Option Notice pursuant to the Receivables Purchase Agreement and all such amounts shall be utilized to first repurchase any Put Identified Receivables (as defined in the Receivables Purchase Agreement) of such Project Participant then held by the Gas Supplier pursuant to Section 2.1(d) of the Receivables Purchase Agreement. Thereafter, amounts deposited into the Debt Service Account shall be applied in accordance with this Article V. (e) (d) The Trustee shall maintain adequate and accurate records, and shall verify the same with the Surety Provider, showing the current amount of the Surety Bond Coverage under each Surety Bond and the amounts paid and owing to the Surety Provider under the terms of the Financial Guaranty Agreements. If any drawing on a Surety Bond reduces the Surety Bond Coverage for such Surety Bond below the amount set forth in Section 5.09(a), the Trustee and SCPPA, with respect to the applicable Project Participant, shall take the actions required by Section 7.11(b) (if not already taken pursuant to Section 7.11(b)). (f) (e) Whenever the amount or moneys (if applicable) on deposit in a SubaccountSubaccount of the Debt Service Reserve Account shall exceed the amount set forth in Section 5.09(a) for that Subaccount, such excess shall, upon Written Direction from SCPPA, be transferred by the Trustee for deposit in the applicable Account in the Revenue Fund with respect to the related Project Participant. Section 5.10 General Fund. (a) The Trustee shall apply moneys to the credit of a Generalan Account in the General Fund with respect to a given Project Participant in the following amounts and in the following order of priority: first, to the transfer to the credit of the Debt Service Account the amount necessary (or all the moneys credited to such General Account in the General Fund if less than the amount necessary) to make up any deficiencies in payments to the Debt Service Account with respect to such Project Participant as required by Section 5.05(a)(ii), second, to the credit of the Debt Service Reserve Account Subaccount bearing the name of such Project Participant, such amount as shall be necessary to reimburse the Surety Provider for amounts drawn on the Surety Bond relating to such Project Participant, but only to the extent required by the applicable Financial Guaranty Agreement, and third, to the credit of the Working Capital Account Subaccount bearing the name of such Project Participant, the amount necessary to cause the amount to be on deposit therein as set forth in Schedule VI. Following the foregoing, SCPPA shall, to the extent of available funds in the Account in the General Fund with respect to a Project Participant, repurchase all Identified Receivables of such Project Participant then held by the Gas Supplier pursuant to the Receivables Purchase Agreement, and then shall, to the extent of any remaining available funds in such Account, pay all RPA Accrued Interest in respect of such Identified Receivables to the Gas Supplier pursuant to the Receivables Purchase Agreement. (b) Amounts credited to the General Fund not required to meet a deficiency or other obligation as required in subsection (a) above shall upon determination of SCPPA be applied to or set aside by the Trustee pursuant to a Written Direction of SCPPA (without any order of priority) for any one or more of the following: 50

79 (i) the purchase or redemption of Bonds and expenses in connection with the purchase or redemption of such Bonds or any reserves which SCPPA determines shall be required for such purposes; (ii) payment of Operating Expenses or credit to the Operating Fund for application to the purposes of that Fund; (iii) payment of Extraordinary Expenses; (iv) payments into the Project Fund for application to the purposes of such Fund (including the subsidizing of any purchase or remarketing of Gas undertaken by SCPPA itself); Gas Project; (v) (vi) (vii) payments of any additional items of the Cost of Acquisition of the reimbursement of amounts due to the Surety Provider; rebates to Project Participants; and (viii) any other lawful purpose of SCPPA under the Act; provided, however, that, subject to the provisions of subsection (a) of this Section, amounts credited to the General Fund and required by this Indenture to be applied to the purchase or redemption of Bonds shall be applied to such purpose. Section 5.11 Purchases of Bonds. Except as otherwise provided in Section 5.07, any purchase of Bonds (or portions thereof) by or at the direction of SCPPA pursuant to this Indenture may be made with or without tenders of Bonds and at either public or private sale, in such manner as SCPPA may determine. ARTICLE VI Depositories of Moneys, Security for Deposits and Investment of Funds Section 6.01 Depositories. (a) All moneys held by the Trustee and SCPPA under the provisions of this Indenture shall constitute trust funds, and the Trustee and SCPPA may deposit such moneys with one or more Depositories in trust for said parties. All moneys deposited under the provisions of this Indenture with the Trustee, SCPPA or any Depository shall be held in trust and applied only in accordance with the provisions of this Indenture. The Funds provided herein to be held by SCPPA shall be held in the custody of SCPPA (or a Depository designated by the Executive Director of SCPPA or, if the Executive Director is not available, the chief financial officer of SCPPA or the chief financial officer of any agent appointed by SCPPA pursuant to an agency agreement to act as an agent with respect to the Gas Project) who shall act as trustee of such Funds for purposes hereof, and such Funds shall constitute part of the Trust Estate subject to a lien and charge in favor of the Holders. 51

80 (b) Each Depository shall be a bank or trust company organized under the laws of any state of the United States or a national banking association having capital stock, surplus and undivided earnings of $50,000,000 or more, and willing and able to accept the office on reasonable and customary terms and authorized by law to act in accordance with the provisions of this Indenture. Section 6.02 Deposits. (a) All Revenues and moneys held by any Depository under this Indenture may be placed on demand or time deposit, if and as directed by SCPPA, provided that such deposits shall permit the moneys so held to be available for use at the time when needed. Any such deposit may be made in the commercial banking department of any Fiduciary which may honor checks and drafts on such deposit with the same force and effect as if it were not such Fiduciary. All moneys held by any Fiduciary, as such, may be deposited by such Fiduciary in its banking department on demand or, if and to the extent directed by SCPPA and acceptable to such Fiduciary, on time deposit, provided that such moneys on deposit be available for use at the time when needed. Such Fiduciary shall allow and credit on such moneys such interest, if any, as it customarily allows upon similar funds of similar size and under similar conditions or as required by law. (b) All moneys held under this Indenture by the Trustee, SCPPA or any Depository shall be held in such manner as may then be required by applicable Federal or State laws and regulations and applicable state laws and regulations of the state in which such Depository is located, regarding security for, or granting a preference in the case of, the deposit of public or trust funds or, in the absence of such laws and regulations, shall be either (i) continuously or fully insured by the Federal Deposit Insurance Corporation, or (ii) continuously and fully secured, to the extent not insured by the Federal Deposit Insurance Corporation, by lodging with the Trustee or SCPPA, as custodian, as collateral security, Qualified Investments having a market value (exclusive of accrued interest) not less than the amount of such moneys (or portion thereof not insured by the Federal Deposit Insurance Corporation); provided, however, that, to the extent permitted by law, it shall not be necessary for the Fiduciaries to give security under this subsection (b) for the deposit of any moneys with them held in trust and set aside by them for the payment of the principal or Redemption Price of or interest on any Bonds, or for the Trustee, SCPPA or any Depository to give security for any moneys which shall be represented by obligations or certificates of deposit purchased as an investment of such moneys. (c) All moneys deposited with the Trustee and each Depository shall be credited to the particular Fund or Account to which such moneys belong and, except as provided with respect to the investment of moneys in Qualified Investments in Section 6.03, the moneys credited to each particular Fund or Account shall be kept separate and apart from, and not commingled with, any moneys credited to any other Fund or Account or any other moneys deposited with the Trustee, SCPPA and each Depository. Section 6.03 Investment of Certain Funds. Moneys held in the Debt Service Account and any moneys held in the Debt Service Reserve Account shall be invested and reinvested by the Trustee pursuant to a Written Direction of SCPPA to the fullest extent practicable in Qualified Investments which mature or are payable not later than such times as shall be necessary to provide moneys when needed for payments to be made from such Accounts. 52

81 Moneys held in the Revenue Fund and the Project Fund may be invested and reinvested in Qualified Investments which mature not later than such times as shall be necessary to provide moneys when needed for payments to be made from such Funds. Moneys in the Operating Fund (other than moneys in the General Operating Account of the Operating Fund held with respect to Rebate Payments) may be invested in Qualified Investments which mature within twelve months or guaranteed investment contracts which provide funds as needed and moneys in the General Fund may be invested in Qualified Investments; in any case the Qualified Investments in such Funds or in the Accounts therein shall mature not later than such times as shall be necessary to provide moneys when needed to provide payments from such Funds or Accounts. The Trustee shall make all such investments of moneys held by it in accordance with written instructions received from any Authorized Authority Representative. In making any investment in any Qualified Investments with moneys in any Fund or Account established under this Indenture, SCPPA may instruct the Trustee to combine such moneys with moneys in any other Fund or Account, but solely for purposes of making such investment in such Qualified Investments. Interest (net of that which represents a return of accrued interest paid in connection with the purchase of any investment and, at the discretion of SCPPA, net of any amount thereof required to be rebated to the United States of America which, pursuant to a Written Direction of SCPPA shall be transferred to the General Operating Account of the Operating Fund to pay Rebate Payments) earned on any moneys or investments in such Funds and Accounts (other than any moneys or investments in the Redemption Account in the Debt Service Fund, the General Operating Account of the Operating Fund relating to Rebate Payments, the Debt Service Reserve Account, and the Remarketing Reserve Account in the Project Fund) shall be paid into the Revenue Fund, and applied as follows: (i) interest earnings on the Gas Project Account in the Project Fund and the Debt Service Account in the Debt Service Fund shall be deposited into the Accounts within the Revenue Fund based upon the respective Gas Entitlement Shares and (ii) interest earnings on a Subaccount in the Working Capital Account, a Subaccount in the Commodity Swaps Operating Account and an Account in the General Fund shall be deposited into the related Account in the Revenue Fund with respect to such Project Participant. Interest earned on any moneys or investments in the Redemption Account in the Debt Service Fund, and the General Operating Account of the Operating Fund relating to Rebate Payments, shall be held in such respective Fund or Account for the purposes thereof. Whenever the Debt Service Reserve Account in the Debt Service Fund with respect to a given Project Participant is at its full required amount, net income earned on any moneys or investments therein shall be transferred to the related Account with respect to such Project Participant in the Revenue Fund as provided in Section 5.09(ef). Interest earned on any moneys or investments in the Remarketing Reserve Account in the Project Fund shall remain in the Remarketing Reserve Account until all moneys or investments in the Remarketing Reserve Account are expended pursuant to Section 5.03(c). Nothing in this Indenture shall prevent any Qualified Investments acquired as investments of or security for Funds held under this Indenture from being issued or held in bookentry form on the books of the Department of the Treasury of the United States. Nothing in this Indenture shall preclude the Trustee from investing or reinvesting moneys that it holds in the Funds and Accounts established pursuant to this Indenture through its investment department; provided, however, that SCPPA may, in its discretion, direct that such moneys be invested or reinvested in a manner other than through such investment department. 53

82 SCPPA acknowledges that to the extent regulations of the United States Comptroller of the Currency or other applicable regulatory entity grant SCPPA the right to receive brokerage confirmations of securities transactions made by the Trustee as they occur, SCPPA will not receive such confirmations to the extent permitted by law. The Trustee shall furnish SCPPA periodic account statements which will include detail for all investment transactions made by the Trustee under this Indenture. To the extent any Qualified Investment is insured, guaranteed or otherwise supported by any secondary facility, the Trustee shall make a claim under such facility at such time as shall be required to receive payment thereunder not later than the date required to make any necessary deposit pursuant to Section 5.05 or 5.09 or otherwise under Article V. Section 6.04 Valuation and Sale of Investments. Obligations purchased as an investment of moneys in any Fund created under the provisions of this Indenture shall be deemed at all times to be a part of such Fund and any profit realized from the liquidation of such investment shall be credited to such Fund, and any loss resulting from the liquidation of such investment shall be charged to the respective Fund. In computing the amount in any Fund created under the provisions of this Indenture for any purpose provided in this Indenture, obligations purchased as an investment of moneys therein shall be valued at the lower of market value or the cost thereof. The accrued interest paid in connection with the purchase of any obligation shall be included in the value thereof until interest on such obligation is paid. Such computation shall be determined as of July 1 in each year and at such other times as SCPPA shall determine. Guaranteed investment contracts or similar agreements shall be valued at their face value to the extent that they provide for withdrawals without market adjustment or penalty when they are required to provide payment pursuant to this Indenture. Except as otherwise provided in this Indenture, the Trustee shall sell at the best price obtainable, or present for redemption, any obligation so purchased as an investment whenever it shall be requested so to do by a Written Request of SCPPA. Whenever it shall be necessary in order to provide moneys to meet any payment or transfer from any Fund held by the Trustee or SCPPA, the Trustee or SCPPA shall sell at the best price obtainable or present for redemption such obligation or obligations designated by an Authorized Authority Representative necessary to provide sufficient moneys for such payment or transfer; provided, however, that if SCPPA fails to provide such designation promptly after request thereof by the Trustee, the Trustee may in its discretion select the obligation or obligations to be sold or presented for redemption. The Trustee shall not be liable or responsible for any loss resulting from any such investment, sale or presentation for redemption made in the manner provided above. ARTICLE VII Particular Covenants of SCPPA SCPPA covenants and agrees with the Trustee and the Bondholders as follows: 54

83 Section 7.01 Payment of Bonds. SCPPA shall duly and punctually pay or cause to be paid, but solely from the Trust Estate, the principal or Redemption Price, if any, of every Bond and the interest thereon, at the dates and places and in the manner provided in the Bonds, according to the true intent and meaning thereof. Section 7.02 Extension of Payment of Bonds. SCPPA shall not directly or indirectly extend or assent to the extension of the maturity of any of the Bonds or the time of payment of any claims for interest by the purchase or funding of such Bonds or claims for interest or by any other arrangement, and in case the maturity of any of the Bonds or the time for payment of any such claims for interest shall be extended, such Bonds or claims for interest shall not be entitled, in case of any default under this Indenture, to the benefit of this Indenture or to any payment out of Revenues or Funds established by this Indenture, including the investment income, if any, thereof, pledged under this Indenture or the moneys (except moneys held in trust for the payment of particular Bonds or claims for interest pursuant to this Indenture) held by the Fiduciaries, except subject to the prior payment of the principal of all Bonds Outstanding the maturity of which has not been extended and of such portion of the accrued interest on the Bonds as shall not be represented by such extended claims for interest. Section 7.03 Offices for Servicing Bonds. SCPPA shall at all times maintain one or more agencies where Bonds may be presented for payment. SCPPA hereby appoints the Trustee as Bond Registrar and Paying Agent and the Trustee hereby accepts such appointments. The Trustee shall at all times maintain one or more agencies where Bonds may be presented for registration or transfer and where notices, demands and other documents may be served upon SCPPA in respect of the Bonds or of this Indenture, and the Trustee shall continuously maintain or make arrangements to provide such services. Section 7.04 Further Assurance. At any and all times SCPPA shall, as far as it may be authorized by law, comply with any reasonable request of the Trustee to pass, make, do, execute, acknowledge and deliver all and every such further resolutions, acts, deeds, conveyances, assignments, financing statements, continuation statements, transfers and assurances as are necessary or in the reasonable opinion of the Trustee desirable for the better assuring, conveying, granting, pledging, assigning, perfecting, maintaining the perfection of and confirming all and singular the rights, Revenues and other moneys, securities and funds hereby pledged, or intended so to be, or which SCPPA may become bound to pledge. Section 7.05 Power to Issue Bonds and Pledge the Trust Estate. SCPPA is duly authorized under all applicable laws to create and issue the Bonds and to execute and deliver this Indenture and to pledge the Trust Estate, in the manner and to the extent provided in this Indenture. Except to the extent otherwise provided in this Indenture, the Trust Estate will be free and clear of any pledge, lien, charge or encumbrance thereon or with respect thereto prior to, or of equal rank with, the security interest, the pledge and assignment created by this Indenture, and all action on the part of SCPPA to that end has been and will be duly and validly taken. The Bonds and the provisions of this Indenture are and will be the valid and legally enforceable limited, non-recourse obligations of SCPPA in accordance with their terms and the terms of this Indenture (subject to bankruptcy, insolvency, debt adjustment, moratorium, reorganization or other similar laws affecting creditors rights generally and judicial discretion and the valid exercise of the sovereign police powers of the State and of the constitutional power of the United 55

84 States of America). SCPPA shall at all times, to the extent permitted by law, defend, preserve and protect the pledge of the Revenues and other moneys, securities and funds pledged under this Indenture and all the rights of the Bondholders under this Indenture against all claims and demands of all Persons whomsoever. Section 7.06 Power to Fix and Collect Fees and Charges for the Sale of Gas. SCPPA has, and, to the extent permitted by law, will have as long as any Bonds are Outstanding, good right and lawful power to fix, establish, maintain and collect fees and charges for the sale and transportation of Gas acquired pursuant to or otherwise with respect to the Gas Project, subject to the terms of the Gas Supply Contracts. Section 7.07 Creation of Liens. SCPPA shall not issue any bonds, notes, debentures or other evidences of indebtedness of similar nature, other than the Bonds, payable out of or secured by a security interest in or pledge or assignment of the Trust Estate and shall not create or cause to be created any lien or charge on the Trust Estate other than the lien of this Indenture; provided, however, that nothing contained in this Indenture shall prevent SCPPA from entering into or issuing, if and to the extent permitted by law (a) bond anticipation notes, (b) evidences of indebtedness payable out of or secured by a security interest in a pledge and assignment of Revenues to be derived on and after such date as the pledge of the Revenues provided in this Indenture shall be discharged and satisfied as provided in Section 12.01, (c) Commodity Swaps upon the terms and conditions set forth herein or (d) the Interest Rate Swap upon the terms and conditions set forth herein. Section 7.08 Annual Budget. Prior to the beginning of each Fiscal Year, SCPPA shall prepare and file with the Trustee an Annual Budget for such Fiscal Year prepared in accordance with the provisions of, and in the manner contemplated by, the Gas Supply Contracts, which shall set forth in reasonable detail the estimated Revenues and Operating Expenses and other expenditures for the Gas Project; and the requirements, if any, for the amounts estimated to be deposited into and expended from each Fund and Account established under this Indenture. Such Annual Budget also shall set forth such detail with respect to such Revenues, Operating Expenses and other expenditures and such deposits as shall be necessary or appropriate so as to comply with the Gas Supply Contracts and may set forth such additional material as SCPPA may determine. SCPPA also may at any time adopt an amended Annual Budget for the remainder of the then current Fiscal Year. The Trustee shall only be a repository for the receipt of the Annual Budget and/or any amended Annual Budget and shall have no responsibility or liability with respect to verifying the accuracy of any Annual Budget or amended Annual Budget. Section 7.09 Limitations on Operation and Maintenance and Other Costs. SCPPA shall not incur Operating Expenses in any Fiscal Year in excess of the reasonable and necessary amount of such Operating Expenses. Section 7.10 Fees and Charges. SCPPA shall at all times fix, establish, maintain and collect (or cause to be collected) fees and charges, as and to the extent permitted under the provisions of the Gas Supply Contracts (and subject to any obligation of SCPPA under Section 7.3 of the Gas Purchase Agreements to attempt to remarket or cause to be remarketed Gas in Qualified Sales) for the sale and transportation of Gas acquired pursuant to or otherwise 56

85 with respect to the Gas Project which shall be sufficient to provide Revenues in each Fiscal Year which, together with the other amounts available therefor, shall be equal to the sum of: (i) The amount estimated by SCPPA to be required to be paid during such Fiscal Year into the Operating Fund; (ii) The amounts, if any, required to be paid during such Fiscal Year into the Debt Service Fund other than any such amounts which the Annual Budget anticipates shall be transferred from other Funds; (iii) The amounts, if any, to be paid during such Fiscal Year into any other Fund established under Section 5.02; and (iv) All other charges or liens whatsoever payable out of Revenues during such Fiscal Year. Section 7.11 Gas Supply Contracts, Gas Remarketing, Gas Purchase Agreements, Commodity Swaps and, Interest Rate Swap and Receivables Purchase Agreement; Enforcement and Amendment. (a) SCPPA shall collect or cause to be collected and forthwith cause to be deposited in the Revenue Fund all amounts payable to it pursuant to the Gas Supply Contracts or otherwise payable to it with respect to the Gas Project or any part thereof (except the Monthly Administration Fee and except as otherwise provided in Section 5.04). SCPPA shall take all lawful action to enforce the provisions of the Gas Supply Contracts, as well as any other contract or contracts entered into relating to the Gas Project, including the Receivables Purchase Agreement, and duly perform its covenants and agreements thereunder. SCPPA shall promptly exercise its right to suspend all Gas deliveries under a Gas Supply Contract to any Project Participant that fails to pay when due any amounts owed to SCPPA thereunder. SCPPA will not consent or agree to any termination or rescission of or amendment to or otherwise take any action under or in connection with any Gas Supply Contract which will impair the ability of SCPPA to comply during the current or any future year with the provisions of Section 7.10 or in contravention of subsection (f) of this Section; provided that this provision shall not prevent SCPPA from otherwise taking any action under or in connection with the Gas Supply Contracts which is not prohibited pursuant to the provisions thereof. A copy of each Gas Supply Contract certified by an Authorized Authority Representative shall be filed with the Trustee, and a copy of any such amendment certified by an Authorized Authority Representative shall be filed with the Trustee. (b) If a Project Participant fails to make payment under its Gas Supply Contract by the 24th day of the Month and such nonpayment results in insufficient moneys being available in such Project Participant s Account in the Revenue Fund to fully fund, after any transfers pursuant to Section 5.10, the deposits required by Section 5.05(a) (and without a draw on the Surety Bond relating to such Project Participant or a sale under the Receivables Purchase Agreement of receivables owed by such Project Participant), the Trustee shall immediately notify SCPPA of such fact and SCPPA shall immediately upon receipt of such notice (i) if it has not previously done so, suspend all deliveries of all quantities of Gas under the Gas Supply Contract to the Project Participant that is in default thereunder and (ii) promptly give notice to the Gas Supplier to remarket such quantities of Gas pursuant to Article VII of the applicable Gas 57

86 Purchase Agreement. Immediately after providing such notice to SCPPA, the Trustee shall have the authority to, and shall, take all actions to direct the remarketing of such quantities of Gas under such Gas Purchase Agreement as to which the Trustee shall have received notice of a default by a Project Participant under its Gas Supply Contract, to the extent not taken by SCPPA, and shall continue to direct such remarketing on a monthly basis. In directing any such remarketing, the Trustee shall take all reasonable efforts to provide Monthly Remarketing Notices (as defined in the Gas Purchase Agreements) to the Gas Supplier pursuant to Section 7.1 of the applicable Gas Purchase Agreement so that the Gas Supplier may remarket the Gas for a period of one or more months. SCPPA may recommence its own remarketing and sales efforts with respect to such quantities of Gas at such time as no deficiency in any Fund, Account or Subaccount exists as a result of a Project Participant failure to pay to the Trustee the amount necessary under its Gas Supply Contract. (c) SCPPA may and shall enter into the Gas Purchase Agreements and the Receivables Purchase Agreement. SCPPA shall use its best efforts to enforce the provisions of the Gas Purchase Agreements and the Receivables Purchase Agreement and duly perform its covenants and agreements thereunder and shall use its best efforts to enforce the provisions of the Gas Supplier Guarantee. The Trustee shall promptly notify SCPPA of any payment default that has occurred and is continuing on the part of the Gas Supplier under any Gas Purchase Agreement, the Receivables Purchase Agreement or the Gas Supplier Guarantee for which the Trustee has actual knowledge or notice. SCPPA will not consent or agree to or permit any rescission of or amendment to or otherwise take any action under or in connection with the Gas Purchase Agreements, the Receivables Purchase Agreement or the Gas Supplier Guarantee which will materially impair or materially adversely affect the rights of SCPPA thereunder or the rights or security of the Bondholders under this Indenture or in contravention of subsection (f) of this Section or which will (absent the prior written consent of the Commodity Swap Counterparty) constitute an Additional Termination Event (as defined in a Commodity Swap) under Part 1(i)(E) of such Commodity Swap; provided that this provision shall not prevent SCPPA from otherwise taking any action under or in connection with the Gas Purchase Agreements, the Receivables Purchase Agreement or the Gas Supplier Guarantee which is not prohibited pursuant to the provisions thereof. Copies of the Gas Purchase Agreements certified by an Authorized Authority Representative, the Receivables Purchase Agreement and the Gas Supplier Guarantee shall be filed with the Trustee, and a copy of any such amendment certified by an Authorized Authority Representative shall be filed with the Trustee. (d) Subject to the limitations set forth herein (including but not limited to the limitations and protections set forth in Sections 9.03, 9.04, 9.14 and 9.15 hereof), SCPPA hereby irrevocably appoints and directs the Trustee as its agent to issue notices and to take any other actions that SCPPA is required or permitted to take under (i) the Gas Supply Contracts (including the suspension of Gas deliveries upon the default of a Project Participant), (ii) the Gas Purchase Agreements (including notices to direct the remarketing of Gas and notice designating an Early Termination Date thereunder), (iii) the Gas Supplier Guarantee (including requesting funds under such Guarantee immediately upon an uncured failure by the Gas Supplier to pay), (iv) the Commodity Swaps, (v) the Surety Bonds, (vi) the Interest Rate Swap, (vii) the Financial Guaranty Agreements, (viii) the Receivables Purchase Agreement and (ix) any guaranteed investment contract or similar agreement that is a Qualified Investment. In exercising this agency power, however, the Trustee shall have the authority to take only such actions as are 58

87 necessary under such agreements in order to preserve or protect the security of the Bondholders under this Indenture. Notwithstanding this grant of agency power, SCPPA shall retain, in the absence of any conflicting action by the Trustee (which actions shall be limited as described in the immediately preceding sentence), the right to exercise any rights for which it has appointed the Trustee as its agent in accordance with the foregoing; provided however, if an Event of Default has occurred and is continuing, the Trustee shall have the right to notify SCPPA to cease exercising such rights and, upon receipt of such notice with a copy provided to the Project Participants under the Gas Supply Contracts, the Gas Supplier under the Gas Purchase Agreements, and the guarantor under the Gas Supplier Guarantee, the Commodity Swap Counterparty under the Commodity Swaps, the Surety Provider under the Surety Bonds and the Financial Guaranty Agreements, the Interest Rate Swap Counterparty under the Interest Rate Swap, SCPPA and the Gas Supplier under the Receivables Purchase Agreement and the provider of any guaranteed investment contract or similar agreement that is a Qualified Investment, the Trustee shall have exclusive authority to exercise such rights, and to collect and apply all amounts payable thereunder, until such time as the Trustee issues a subsequent notice otherwise. As the holder of a security interest in SCPPA s right, title, and interest in and to the Gas Purchase Agreements, the Receivables Purchase Agreement, and the Commodity Swaps, the Trustee is authorized and directed to, and the Trustee does hereby, acknowledge the amendment and restatement of such agreements delivered by SCPPA to the Trustee contemporaneously with this Indenture. The Trustee hereby acknowledges that it has not notified SCPPA to cease to exercise its rights under any such agreement pursuant to this Section 7.11(d) or otherwise. (e) SCPPA shall collect or cause to be collected and forthwith cause to be deposited in the Revenue Fund all Commodity Swap Receipts or other amounts payable to it pursuant to the Commodity Swaps (including the guaranty, if any, thereunder) and in the Debt Service Account all Interest Rate Swap Receipts or other amounts payable to it pursuant to the Interest Rate Swap. SCPPA shall use its best efforts to enforce the provisions of the Commodity Swaps and the Interest Rate Swap and duly perform its covenants and agreements thereunder. Except as provided in Section 2.03(b) or 2.03(c) with respect to termination and replacement of a Commodity Swap, SCPPA will not consent or agree to any termination or rescission of or amendment to or otherwise take any action under or in connection with any Commodity Swap or the Interest Rate Swap which will impair the ability of SCPPA to comply during the current or any future year with the provisions hereof or in contravention of subsection (f) of this Section; provided that this provision shall not prevent SCPPA from otherwise taking any action under or in connection with the Commodity Swaps or the Interest Rate Swap which is not prohibited pursuant to the provisions thereof. A copy of each Commodity Swap, certified by an Authorized Authority Representative, shall be filed with the Trustee, and a copy of any such amendment certified by an Authorized Authority Representative shall be filed with the Trustee. The Trustee acknowledges receipt of a copy of the amended and restated Commodity Swaps certified by an Authorized Authority Representative contemporaneously with the execution of this Indenture. (f) SCPPA shall not amend, waive, or otherwise modify the monthly quantities of Gas to be sold and delivered under a Gas Purchase Agreement or a Gas Supply Contract or specified in theany Commodity Swap or the prices for such Gas to be paid pursuant to any such agreement unless SCPPA has first delivered to the Trustee the Accountant s Certificate described in Section

88 Section 7.12 Maintenance of Insurance. SCPPA may, but shall not be required to, purchase one or more policies of insurance in respect of the Gas Project. If it does so, the premiums for such insurance shall be Operating Expenses. Section 7.13 Accounts and Reports. (a) SCPPA shall keep or cause to be kept with respect to the Gas Project proper books of record and accounts (separate from all other books of record and accounts) in accordance with generally accepted accounting principles, as such may be modified by the provisions of this Indenture, in which complete and correct entries in all material respects shall be made of its transactions relating to the Gas Project, the amount of Revenues and the application thereof and each Fund and Account established under this Indenture and relating to its costs and charges under the Gas Supply Contracts and any other contracts for the sale or purchase of Gas, and which, together with the Gas Purchase Agreements and all contracts and all other books and papers of SCPPA, including insurance policies, relating to the Gas Project, shall, subject to the terms thereof, at all times during regular business hours be subject to the inspection of the Trustee and the Holders of an aggregate of not less than 5% in principal amount of the Bonds then Outstanding or their representatives duly authorized in writing. (b) The Trustee shall advise SCPPA promptly after the end of each Month, by providing monthly account statements or otherwise, of the respective transactions during such Month relating to each Fund and Account held by it under this Indenture. (c) SCPPA shall file with the Trustee (i) forthwith upon becoming aware of any Event of Default or default in the performance by SCPPA of any covenant, agreement or condition contained in this Indenture, a Written Certificate of SCPPA and specifying such Event of Default or default and (ii) within 180 days after the end of each Fiscal Year, commencing with the first Fiscal Year ending following the issuance of the Bonds, a Written Certificate of SCPPA signed by an appropriate Authorized Authority Representative stating that to such Authorized Authority Representative s knowledge there does not exist at the date of such certificate any default by SCPPA under this Indenture or any Event of Default or other event which, with the lapse of time specified in Section 8.01, would become an Event of Default, or, if any such default or Event of Default or other event shall so exist, specifying the same and the nature and status thereof. (d) The reports, statements and other documents required to be furnished to the Trustee pursuant to any provisions of this Indenture shall be available for the inspection of Bondholders at the office of the Trustee and shall be mailed to each Bondholder who shall file a written request therefor with SCPPA. SCPPA may charge each Bondholder requesting such reports, statements and other documents a reasonable fee to cover reproduction, handling and postage. Section 7.14 Payment of Taxes and Charges. SCPPA will from time to time duly pay and discharge, or cause to be paid and discharged, all taxes, assessments and other governmental charges, or required payments in lieu thereof, lawfully imposed upon the properties of SCPPA or upon the rights, revenues, income, receipts, and other moneys, securities and funds of SCPPA when the same shall become due (including all rights, moneys and other property transferred, assigned or pledged under this Indenture), and all lawful claims for labor and material and 60

89 supplies that are due and payable, except those taxes, assessments, charges or claims which SCPPA shall in good faith contest by proper legal proceedings if SCPPA shall in all such cases have set aside on its books reserves deemed adequate by SCPPA with respect thereto. Section 7.15 Tax Covenants. (a) General. SCPPA shall not take any action or omit to take any action which, if taken or omitted, respectively, would adversely affect the excludability of interest on any Bond from the gross income, as defined in section 61 of the Internal Revenue Code, of the owner thereof for federal income tax purposes. SCPPA and the Trustee shall execute such amendments hereof and supplements hereto (and shall comply with the provisions thereof) as are, in the Opinion of Bond Counsel, necessary to preserve or perfect such exclusion. SCPPA shall comply with each specific covenant in this Section at all times prior to the last maturity of Bonds (and, in the case of subsection (j) of this Section, until compliance therewith in full), unless and until there shall have been delivered to the Trustee an Opinion of Bond Counsel to the effect that failure to comply with such covenant, either generally or to the extent stated therein, shall not adversely affect the excludability of interest on any Bond from the gross income, as defined in section 61 of the Internal Revenue Code, of the owner thereof for federal income tax purposes, and thereafter such covenant shall no longer be binding upon SCPPA, generally or to such extent as the case may be, anything in any other subsection of this Section to the contrary notwithstanding. (b) Representations. All representations, warranties, and certifications made by SCPPA in connection with the delivery of the Bonds on the date of issuance thereof, including, but not limited to, those representations, warranties, and certifications contained in any certificate related to the federal income tax status of the Bonds, are and shall be true, correct, and complete in all material respects. (c) No Private Use or Payments. Prior to the last maturity of the Bonds of any issue, (i) SCPPA shall not use or permit the use of proceeds thereof (or any property acquired, constructed, or improved with proceeds thereof) directly or indirectly in any Private Business Use, or (ii) SCPPA shall not directly or indirectly impose or accept any charge or other payment for use of proceeds (or for use of any property acquired, constructed, or improved with proceeds thereof) in any Private Business Use. As used herein, Private Business Use means any trade or business carried on by any Person, or any activity of any Person other than a natural person, in each case excluding state and local governments, unless such use is merely as a member (and, except possibly for the amount of use and any corresponding rate adjustment, is extended on the same terms as to all other members) of the general public. if: For purposes of the foregoing covenant, property is considered to be used by a Person Person; (1) Dispositions: it is sold or otherwise disposed of, or leased, to such (2) Operation or Management: it is operated, managed, or otherwise physically employed, utilized, or consumed by such Person, excluding operation or 61

90 management pursuant to an agreement which meets the guidelines set forth in Revenue Procedure 97-13, including any amendments or revisions thereto; (3) Contractual Commitments: capacity in or output or service from such property is reserved or committed to such Person under a take or pay, output, incentive payment, or similar contract or arrangement; (4) Special Services: such property is used to provide service to (or such service is committed to or reserved for) such Person on a basis or terms which are different from the basis or terms on which such service is provided (or committed or reserved) to members of the public generally; for this purpose, (i) use under an arrangement that conveys priority rights or other preferential benefits is not use on the same basis as the public generally; (ii) arrangements providing for use that is available to the general public at no charge or on the basis of rates that are generally applicable and uniformly applied do not convey priority rights or other preferential benefits; and (iii) rates may be treated as generally applicable and uniformly applied even if (A) different rates apply to different classes of users, such as volume purchasers, if the differences in rates are customary and reasonable, or (B) a specially negotiated rate arrangement is entered into (but only if the user is prohibited by federal law from paying the generally applicable rates, and the rates established are as comparable as reasonably possible to the generally applicable rates); or (5) Burdens and Benefits: substantial burdens and benefits of ownership of such property are otherwise effectively transferred to such Person, but the temporary investment of proceeds pending application for their intended purposes shall not constitute use of proceeds. Notwithstanding the foregoing, SCPPA may sell Gas for Private Business Use in quantities with a cumulative value (valued at the price payable to SCPPA under the Commodity Swap for the month of delivery) to any date that does not exceed the lesser of (a) $15,000,000 or (b) 5% of the cumulative value (as so determined) of all Gas purchased pursuant to the Gas Purchase Agreements as of such date. (d) No Private Loan. SCPPA shall not use proceeds of the Bonds of any issue to make or finance loans to any Person other than a state or local government, excluding loans consisting of temporary investments of proceeds pending application for their intended purposes. For purposes of the foregoing covenant, such proceeds are considered to be loaned to a Person if (i) property acquired, constructed, or improved with such proceeds is sold or leased to such Person in a transaction which creates a debt for federal income tax purposes, (ii) capacity in or service from such property is committed to such Person under a take or pay, output, or similar contract or arrangement, or (iii) indirect benefits, or burdens and benefits of ownership, of such proceeds or such property are otherwise transferred in a transaction which is the economic equivalent of a loan. (e) Use in Qualified Service Areas. SCPPA shall cause each Project Participant to forecast, nominate, and sell or burn Gas purchased by it from SCPPA pursuant to a Gas Supply Contract such that all such Gas is (1) furnished to customers of the Project 62

91 Participant who purchase such Gas other than for resale or to produce electricity for sale and are located in either (a) an area throughout which the Project Participant provided, at all times during the 5-year period ending on the date of initial authentication and delivery of the Bonds, natural gas transmission or distribution services or (b) an area recognized as the natural gas service area of the Project Participant under state or federal law, or (2) used by the Project Participant to produce electricity that is furnished to electric customers of the Project Participant who purchase such electricity other than for resale and are located in either (a) an area throughout which the Project Participant provided, at all times during such 5-year period, electricity distribution service or (b) an area recognized as the electricity service area of the Project Participant under state or federal law, or (3) used by the Project Participant to produce electricity that is sold to a utility owned by a state or local government and is furnished by such utility to electric customers of such utility who purchase such electricity other than for resale and are located in either (a) an area throughout which such utility provided, at all times during such 5-year period, electricity distribution service or (b) an area recognized as the electricity service area of such entity under state or federal law, or (4) sold to a utility owned by a state or local government that furnishes or uses such gas solely as described in the immediately preceding clauses (1), (2), and (3), applied as if references to the Project Participant therein were to such utility, or (5) used to fuel the pipeline transportation of such Gas. (f) Not to Invest at Higher Yield. SCPPA shall not, at any time prior to the final maturity of the Bonds of any issue, directly or indirectly invest (or direct or permit the Trustee to invest) Gross Proceeds of the Bonds of such issue in any Taxable Investment, if as a result of such investment the Yield of all Taxable Investments acquired with (or representing an investment of) Gross Proceeds of the Bonds of such issue, whether then held or previously disposed of, on or prior to the date of such investment exceeds the Yield of the Bonds of such issue, excluding from the foregoing, however, Gross Proceeds held for a temporary period described in Section (e) or (d) of the Regulations, or in a reasonably required reserve or replacement fund described in (but only to the extent permitted by) Section (f) or (e) of the Regulations, or as less than a minor portion described in Section (g) or (f) of the Regulations, in each case to the extent (but only to the extent) such Sections are applicable to the Bonds of such issue. SCPPA shall not (and shall not direct or permit the Trustee to) invest Gross Proceeds of the Bonds of any issue in any Taxable Investment that is not of a type traded on an established securities market, within the meaning of section 1273 of the Internal Revenue Code, except for investments of the type and made in the manner described in Section (d)(6) of the Regulations. (g) No Federal Guarantees, Etc. SCPPA shall not (nor shall it permit the Trustee to) either (1) use proceeds of the Bonds of any issue in an amount which exceeds 5% of the proceeds from the sale of the Bonds of such issue (a) to make loans which are guaranteed in whole or in part by the United States or any agency or instrumentality thereof, including any entity with statutory authority to borrow from the United States, or (b) to invest in any deposit or account in a financial institution to the extent such deposit or account is insured under federal law by the Federal Deposit Insurance Corporation, the National Credit Union Administration, or any similar federally chartered corporation, or (2) otherwise permit payment of principal of or interest on the Bonds of any issue to be directly or indirectly guaranteed in whole or in part by the United States or any agency or instrumentality thereof, including any entity with statutory 63

92 authority to borrow from the United States. Notwithstanding the foregoing, however, SCPPA may (and may permit the Trustee to) acquire: (1) Temporary Periods and Reserve Funds: investments which may be invested without limitation as to Yield pursuant to subsection (f) of this Section because held for a temporary period or in a reasonably required reserve or replacement fund described therein; and (2) Direct Issues: investments issued by the United States Treasury; (3) Other: any other investments permitted by regulations of the United States Department of Treasury issued under section 149(b)(3)(B)(v) of the Internal Revenue Code. (h) To File Informational Report. SCPPA shall execute and file with the Secretary of the Treasury, not later than the 15th day of the second calendar month after the close of the calendar quarter in which the date of issuance of each issue of Bonds occurs (or by such later date as such Secretary may permit for reasonable cause or may prescribe with respect to any portion of such statement), a statement in respect of the Bonds of such issue containing the information and in the form required by section 149(e) of the Internal Revenue Code and Section 1.149(e)-1 of the Regulations. (i) Not to Cause Bonds to Become Hedge Bonds. SCPPA shall not (and shall not direct the Trustee to) invest more than 50% of the proceeds of the Bonds of any issue in Taxable Investments having a substantially guaranteed yield for a period of four years or more, unless (1) SCPPA reasonably expects to expend the proceeds of the Bonds of such issue by the times and in the amounts described in section 149(g)(2) of the Internal Revenue Code and agrees to pay and pays legal and underwriting costs associated with the Bonds of such issue in accordance with section 149(f)(3) of the Internal Revenue Code or (2) the Bonds of such issue are described in section 149(g)(3)(B) or (C) of the Internal Revenue Code. (j) To Rebate Arbitrage Profits. (1) To Deliver Documents. SCPPA shall deliver to the Trustee, within 55 days after each Computation Date for the Bonds of each issue: (a) Statement of Rebate Amount: a statement, signed by an Accountant, stating (i) the Rebate Amount for the Bonds of such issue as of such Computation Date or redemption date, taking into account as computation dates each Computation Date for the Bonds of such issue, but only such Computation Dates and such redemption date, and (ii) if such Computation Date is a Rebate Calculation Date for the Bonds of such issue, the minimum portion of such Rebate Amount which must be remitted to the United States Treasury in respect of such Rebate Calculation Date to satisfy the requirements of Section (f) of the Regulations; and (b) IRS Forms: if such Computation Date is a Rebate Calculation Date for the Bonds of any issue, an Internal Revenue Service Form 8038-T in 64

93 respect of the Bonds of such issue completed as of such Computation Date or such other form as may be required to be filed by the Regulations. (2) To Pay Arbitrage Rebate. SCPPA shall pay to the United States Treasury each amount described in clause (j)(1)(a)(ii) of this Section and specified in a certificate of an Accountant delivered to the Trustee pursuant to this subsection (j), within 60 days after the relevant Rebate Calculation Date. (3) To Correct Underpayments. If SCPPA shall discover or be notified as of any date that any payment made to the United States Treasury in respect of the Bonds of any issue shall have failed to satisfy any requirement of Section of the Regulations (whether or not such failure shall be due to any default by SCPPA or the Trustee), SCPPA shall (a) deliver to the Trustee a brief written explanation of such failure and any basis for concluding that such failure was not due to willful neglect and (b) direct the Trustee to pay to the United States Treasury, within 180 days after such discovery or notice, the correct Rebate Amount in respect thereof, interest thereon, and any penalty imposed under Section (h) of the Regulations. (4) To Preserve Accounting Records. SCPPA shall retain all of its accounting records relating to the funds and accounts held hereunder, and all calculations made in preparing the statements described in clause (j)(1)(a) of this Section, for at least six years after the dates of the final maturity of the Bonds of the applicable issue or the first date on which no Bonds of such issue are outstanding. (5) Exemption from Rebate. If SCPPA shall deliver to the Trustee, on or before the first Rebate Calculation Date, a Written Statement of SCPPA, signed by an Accountant, stating that all Gross Proceeds of the Bonds were expended within six months after the issue date of the Bonds, excluding Gross Proceeds credited to the Debt Service Account, if any, then the provisions of this subsection (j) shall be suspended until such time, if ever, as such provisions are reinstated in accordance with subsection (j)(5). If, more than six months after the issue date for the Bonds or the date of such Written Statement, Gross Proceeds of the Bonds (other than amounts credited to the Debt Service Account) exist, SCPPA shall promptly deliver to the Trustee a Written Statement of SCPPA stating such fact, and the provisions of this subsection (j) shall be reinstated, but only with respect to such Gross Proceeds. (k) Accounting. In complying with the provisions of this Section, SCPPA (1) shall use a reasonable, consistently applied method of accounting for Gross Proceeds of the Bonds of each issue and all investments and expenditures thereof, which shall be consistent with all applicable provisions of Section and of the Regulations, and (2) shall not recognize any expenditure of proceeds of the Bonds of any issue to reimburse an expenditure paid before the issue date of the Bonds of such issue unless (a) SCPPA has made a written allocation of such proceeds to such expenditures in accordance with the provisions of Section (d) of the Regulations within 30 days of such issue date or (b) such expenditures are described in Section (f) of the Regulations. 65

94 (l) Issue. As used in this Section (and in the definitions of terms used herein, when such terms are used herein), an issue of Bonds includes all Bonds treated as part of the same issue pursuant to Section (c) of the Regulations. Section 7.16 General. (a) SCPPA shall at all times maintain its existence and shall do and perform or cause to be done and performed all acts and things required to be done or performed by or on behalf of SCPPA under the provisions of the Act and this Indenture. (b) SCPPA shall not consolidate or amalgamate with, or merge with or into, or transfer all or substantially all its assets to, or reorganize, reincorporate or reconstitute into or as, another entity unless, (i) prior to such event, SCPPA receives confirmation from (A) the Commodity Swap Counterparty that such event does not trigger a termination event under Section 5(b)(iv) of the Commodity Swaps and (B) the Interest Rate Swap Counterparty that such event does not trigger a termination event under Section 5(b)(iv) of the Interest Rate Swap; and (ii) at the time of such consolidation, amalgamation, merger, transfer, reorganization, reincorporation or reconstitution, the resulting, surviving or transferee entity assumes all the obligations of SCPPA under the Commodity Swaps and the Interest Rate Swap. (c) SCPPA shall not take any action, or fail to take any action, or permit any action to be taken on its behalf or cause or permit any circumstance within its control to arise or continue, if any such action or inaction would adversely affect the ratings on the Bonds. (d) Upon the date of authentication and delivery of any of the Bonds, all conditions, acts and things required by law and this Indenture to exist, to have happened and to have been performed precedent to and in the issuance of such Bonds shall exist, have happened and have been performed, and the issuance of such Bonds, together with all other obligations of SCPPA, shall comply in all respects with the applicable laws of the State. Section 7.17 Bankruptcy. To the extent permitted by law, SCPPA shall not, prior to the date which is one year and one day after the termination of this Indenture, acquiesce, petition, or otherwise invoke the process of any court or government authority for the purpose of commencing or sustaining a case under any federal or state bankruptcy, insolvency, or similar law or appointing a receiver, liquidator, assignee, trustee, custodian or sequestrator for any substantial part of its property, or ordering the winding up or liquidation of the affairs of SCPPA. This covenant shall survive the termination of this Indenture. Section 7.18 Bylaws. SCPPA shall not amend its Bylaws to change the voting requirements for a voluntary sale of all, or substantially all, of its assets or a voluntary filing for bankruptcy while any Bonds remain Outstanding. Section 7.19 Replacement of Gas Supplier Guarantee. SCPPA shall not replace The Goldman Sachs Group, Inc., as issuer of the Gas Supplier Guarantee, or replace any successor issuer thereof, or consent to any assignment thereof by the obligor thereon without recourse, in each case without obtaining a Rating Confirmation. For the avoidance of doubt, this Section 7.19 is in addition to, and does not override, any other provision of this Indenture or any other document relating to the replacement of the issuer of the Gas Supplier Guarantee. 66

95 ARTICLE VIII Events of Default and Remedies Section 8.01 Events of Default. Any one or more of the following shall constitute an Event of Default hereunder: (a) default shall be made in the due and punctual payment of the principal or Redemption Price of any Bond when and as the same shall become due and payable, whether at maturity, by call for redemption, or otherwise; (b) default shall be made in the due and punctual payment of any installment of interest on any Bond when and as such interest installment shall become due and payable; (c) a determination by the Trustee on the last Business Day of any Month, after the transfer of amounts pursuant to Section 5.05(a)(ii) and (iv), that the sum of the amounts on deposit in the Debt Service Account and the Debt Service Reserve Account (including for purposes of this computation, interest accrued on such deposits and investment income that remains on deposit in such Accounts) is not at least equal to the cumulative Scheduled Debt Service Deposits for such month as specified on Schedule II hereto (as such cumulative Scheduled Debt Service Deposits may be reduced pursuant to Section 4.11); (d) default shall be made by SCPPA in the performance or observance of any other of the covenants, agreements or conditions on its part in this Indenture or in the Bonds contained, and such default shall continue for a period of 60 days or, if such default cannot reasonably be remedied within such 60 day period, such longer period so long as diligent efforts are being made to remedy such default, after written notice thereof specifying such default and requiring that it shall have been remedied and stating that such notice is a Notice of Default hereunder is given to SCPPA by the Trustee or to SCPPA and to the Trustee by the Holders of not less than 10% in principal amount of the Bonds Outstanding; (e) default shall be made in the due and punctual payment of any Commodity Swap Payments when and as the same shall become due and payable; (f) default shall be made in the due and punctual payment of any Interest Rate Swap Payments when and as the same shall become due and payable; (g) SCPPA shall commence a voluntary case or similar proceeding under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect (provided, however, that such event shall not constitute an Event of Default hereunder unless in addition, (i) SCPPA is unable to meet its debts with respect to the Gas Project as such debts mature or (ii) any plan of adjustment or other action in such proceeding would affect in any way the Revenues or the Gas Project), or shall authorize, apply for or consent to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator or similar official for the Gas Project, or any part thereof, and/or the rents, fees, charges or other revenues therefrom, or shall make any general assignment for the benefit of creditors, or shall make a written declaration or admission to the effect that it is unable to meet its debts with respect to the 67

96 Gas Project as such debts mature, or shall authorize or take any action in furtherance of any of the foregoing; (h) a court having jurisdiction in the premises shall enter a decree or order for relief in respect of SCPPA in an involuntary case or similar proceeding under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, (provided, however, that such event shall not constitute an Event of Default hereunder unless in addition, (i) SCPPA is unable to meet its debts with respect to the Gas Project as such debts mature or (ii) any plan of adjustment or other action in such proceeding would affect in any way the Revenues or the Gas Project), or a decree or order appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official for the Gas Project, or any part thereof, and/or the rents, fees, charges or other revenues therefor, or a decree or order for the dissolution, liquidation or winding up of SCPPA and its affairs or a decree or order finding or determining that SCPPA is unable to meet its debts with respect to the Gas Project as such debts mature, and any such decree or order shall remain unstayed and in effect for a period of 60 consecutive days; and Indenture. (i) there shall occur any other Event of Default specified in a Supplemental In clauses (a), (b) and (f) above, so long as such Event of Default shall not have been remedied, unless the principal of all the Bonds shall have already become due and payable, the Trustee (by notice in writing to SCPPA), or the Holders of not less than a majority in principal amount of the Bonds Outstanding (by notice in writing to SCPPA and to the Trustee) may declare the principal of all the Bonds then Outstanding, and the interest accrued thereon, to be due and payable immediately, and upon any such declaration the same shall become and be immediately due and payable, anything in this Indenture or in any of the Bonds contained to the contrary notwithstanding. In the case of an Event of Default described in clause (c), (d), (e), (g), (h) or (i) above, unless the principal amount of all the Bonds shall have already become due and payable, the Trustee or, at the direction of the Holders of not less than a majorityone hundred percent (100%) in principal amount of the Bonds outstanding (after notice to the Trustee) may bring a suit in any court of competent jurisdiction to compel specific performance, shall declare the principal of all the Bonds then Outstanding, and the interest accrued thereon, to be due and payable immediately, and upon any such declaration the same shall become and be immediately due and payable. The right of the Trustee or, at the direction of the Holders of not less than a majorityone hundred percent (100%) in principal amount of the Bonds, to make any such declaration as aforesaid, however, is subject to the condition that if, at any time before the Bonds shall have matured by their terms, all overdue installments of interest upon the Bonds, together with the reasonable fees, charges, expenses and liabilities of the Trustee, and all other sums then payable by SCPPA under this Indenture (except the principal of, and interest accrued since the next preceding Interest Payment Date on, the Bonds due and payable solely by virtue of such declaration) shall either be paid by or for the account of SCPPA or provision satisfactory to the Trustee shall be made for such payment, and all defaults under the Bonds or under this Indenture (other than the payment of principal and interest due and payable solely by reason of such declaration) shall be made good or be secured to the satisfaction of the Trustee or provision deemed by the Trustee to be adequate shall be made therefor, then and in every such case the Holders of a majority in principal amount of the Bonds Outstanding, by written notice to SCPPA and to the Trustee, may rescind such declaration and annul such default in its entirety, or, if the 68

97 Trustee shall have acted itself, and if there shall not have been theretofore delivered to the Trustee written directions to the contrary by the Holders of a majority in principal amount of the Bonds Outstanding, then any such declaration shall ipso facto be deemed to be rescinded and any such default shall ipso facto be deemed to be annulled, but no such rescission or annulment shall extend to or affect any subsequent default or impair or exhaust any right or power consequent thereon. Section 8.02 Accounting and Examination of Records After Default. SCPPA covenants that if an Event of Default shall have happened and shall not have been remedied, the books of record and accounts of SCPPA and all other records relating to the Gas Project shall at all times during regular business hours be subject to the inspection and use of the Trustee and of its agents and attorneys upon reasonable notice. Section 8.03 Enforcement of Agreements; Application of Moneys After Default. (a) During the continuance of an Event of Default, the Trustee shall apply all moneys, securities, funds and Revenues received by the Trustee pursuant to any right given or action taken under the provisions of this Article as follows and in the following order, provided that (i) moneys or amounts held in the Debt Service Account or the Debt Service Reserve Account shall not be used for purposes other than payment of the interest and principal or Redemption Price then due on the Bonds and Interest Rate Swap Payments in accordance with clause (iii) of this subsection (a) and (ii) moneys in the Working Capital Account shall be used first to pay any Commodity Swap Payments then due: (i) Expenses of Fiduciaries to the payment of the reasonable fees, charges, expenses and liabilities of the Fiduciaries; (ii) Operating Expenses to the payment of Commodity Swap Payments, then to the payment of the amounts required for other Operating Expenses and for the payment of such other amounts related to the Gas Project as are necessary in the judgment of the Trustee to prevent loss of Revenues. For this purpose the books of record and accounts of SCPPA relating to the Gas Project shall at all times during regular business hours upon reasonable notice be subject to the inspection of the Trustee and its representatives and agents during the continuance of such Event of Default; (iii) Principal or Redemption Price and Interest to the payment of the principal and interest then due and unpaid upon the Bonds and the Interest Rate Swap Payments, without preference or priority of principal over interest or of interest over principal, or of any installment of interest over any other installment of interest, or of any Bond over any other Bond or Interest Rate Swap Payments, ratably, according to the amounts due respectively for principal and interest or Interest Rate Swap Payments, to the Persons entitled thereto without any discrimination or preference except as to any difference in the respective rates of interest specified in the Bonds; and (iv) Extraordinary Expenses to the payment of the amounts required for the payment of any Extraordinary Expenses when due. 69

98 (b) If and whenever all overdue installments of interest on all Bonds, together with the reasonable charges, expenses and liabilities of the Trustee, and all other sums payable or secured by SCPPA under this Indenture, including the principal and Redemption Price of and accrued unpaid interest on all Bonds which shall then be payable by declaration or otherwise, shall either be paid by or for the account of SCPPA, or provisions satisfactory to the Trustee shall be made for such payment, and all defaults under this Indenture or the Bonds shall be made good or secured to the satisfaction of the Trustee or provision deemed by the Trustee to be adequate shall be made therefor, SCPPA and the Trustee shall be restored, respectively, to their former positions and rights under this Indenture. No such restoration of SCPPA and the Trustee to their former positions and rights shall extend to or affect any subsequent default under this Indenture or impair any right consequent thereon. Section 8.04 Appointment of Receiver. The Trustee shall have the right, upon the happening and during the continuance of an Event of Default, to apply in an appropriate proceeding for the appointment of a receiver of the Gas Project. Section 8.05 Proceedings Brought by Trustee. (a) If an Event of Default shall happen and shall not have been remedied, then and in every such case, the Trustee, by its agents and attorneys, may proceed, and upon written request of the Holders of not less than a majority in principal amount of the Bonds Outstanding shall proceed, to protect and enforce its rights and the rights of the Holders of the Bonds under this Indenture forthwith by a suit or suits in equity or at law, whether for the specific performance of any covenant herein contained, or in aid of the execution of any power herein granted, or for an accounting against SCPPA as if SCPPA were the trustee of an express trust, or in the enforcement of any other legal or equitable right as the Trustee, being advised by counsel, shall deem most effectual to enforce any of its rights or to perform any of its duties under this Indenture. (b) All rights of action under this Indenture may be enforced by the Trustee without the possession of any of the Bonds or the production thereof at the trial or other proceedings, and any such suit or proceedings instituted by the Trustee shall be brought in its name. (c) The Holders of not less than a majority in principal amount of the Bonds at the time Outstanding may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, provided that the Trustee shall have the right to decline to follow any such direction if the Trustee shall be advised by counsel that the action or proceeding so directed may not lawfully be taken, or if the Trustee in good faith shall determine that the action or proceeding so directed would involve the Trustee in personal liability or be unjustly prejudicial to the Bondholders not parties to such direction. (d) Upon commencing a suit in equity or upon other commencement of judicial proceedings by the Trustee to enforce any right under this Indenture, the Trustee shall be entitled to exercise any and all rights and powers conferred in this Indenture and provided to be exercised by the Trustee upon the occurrence and during the continuance of any Event of Default. 70

99 (e) Regardless of the happening of an Event of Default, the Trustee shall have power to, but unless requested in writing by the Holders of a majority in principal amount of the Bonds then Outstanding and furnished with reasonable security and indemnity, shall be under no obligation to, institute and maintain such suits and proceedings as are necessary or desirable in the reasonable opinion of the Trustee to prevent any impairment of the security under this Indenture by any acts which may be unlawful or in violation of this Indenture, and such suits and proceedings as are necessary or desirable in the reasonable opinion of the Trustee to preserve or protect its interests and the interests of the Bondholders. Section 8.06 Restriction on Bondholder s Action. (a) No Holder of any Bond shall have any right to institute any suit, action or proceeding at law or in equity for the enforcement of any provision of this Indenture or the execution of any trust under this Indenture or for any remedy under this Indenture, unless such Holder (i) shall have previously given to the Trustee written notice of the happening of an Event of Default, as provided in this Article, and the Holders of at least a majority in principal amount of the Bonds then Outstanding shall have filed a written request with the Trustee, (ii) shall have offered the Trustee reasonable opportunity, either to exercise the powers granted in this Indenture or by the Act or by the laws of the State or to institute such action, suit or proceeding in its own name, and (iii) shall have offered to the Trustee adequate security and indemnity against the costs, expenses and liabilities to be incurred therein or thereby, and the Trustee shall have refused to comply with such request for a period of 60 days after receipt by it of such notice, request and offer of indemnity, it being understood and intended that no one or more Holders of Bonds shall have any right in any manner whatever by its or their action to affect, disturb or prejudice the pledge created by this Indenture, or to enforce any right under this Indenture, except in the manner therein provided; and that all proceedings at law or in equity to enforce any provision of this Indenture shall be instituted, had and maintained in the manner provided in this Indenture and for the equal benefit of all Holders of the Outstanding Bonds, subject only to the provisions of Section (b) Nothing in this Indenture or in the Bonds contained shall affect or impair the obligation of SCPPA, which is absolute and unconditional, to pay solely from the Trust Estate, in accordance with the terms of this Indenture, at the respective dates of maturity and places therein expressed the principal of (and premium, if any) and interest on the Bonds to the respective Holders thereof, or affect or impair the right of action, which is also absolute and unconditional, of any Holder to enforce such payment of its Bond. Section 8.07 Remedies Not Exclusive. No remedy by the terms of this Indenture conferred upon or reserved to the Trustee or the Bondholders is intended to be exclusive of any other remedy, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Indenture or existing at law or in equity or by statute on or after the date of execution and delivery of this Indenture. Section 8.08 Effect of Waiver and Other Circumstances. (a) No delay or omission of the Trustee or any Bondholder to exercise any right or power arising upon the happening of an Event of Default shall impair any right or power or shall be construed to be a waiver of any such Event of Default or be an acquiescence therein; and every power and remedy given by this Article VIII to the Trustee or to the Bondholders may be exercised from time to time and as often as may be deemed expedient by the Trustee or by the Bondholders. 71

100 (b) Prior to the declaration of maturity of the Bonds as provided in Section 8.01, the Holders of not less than a majority in principal amount of the Bonds at the time Outstanding, or their attorneys-in-fact duly authorized, may on behalf of the Holders of all of the Bonds waive any past default under this Indenture and its consequences, except a default in the payment of interest on or principal of or premium (if any) on any of the Bonds. No such waiver shall extend to any subsequent or other default or impair any right consequent thereon. Section 8.09 Notice of Default. The Trustee shall promptly mail written notice of the occurrence of any Event of Default to each registered owner of Bonds then Outstanding at its address, if any, appearing upon the registry books of SCPPA. ARTICLE IX Concerning the Fiduciaries Section 9.01 Acceptance by Trustee of Duties. The Trustee accepts the duties and obligations imposed upon it by this Indenture and the trusts hereby created, but only, however, upon the terms and conditions set forth in this Indenture. Section 9.02 Paying Agents; Appointment and Acceptance of Duties. (a) SCPPA shall appoint one or more Paying Agents for the Bonds, and may at any time or from time to time appoint one or more other Paying Agents. All Paying Agents appointed shall have the qualifications set forth in Section 9.13 for a successor Paying Agent. The Trustee is hereby appointed as initial Paying Agent. (b) Each Paying Agent shall signify its acceptance of the duties and obligations imposed upon it by this Indenture by executing and delivering to SCPPA and to the Trustee a written acceptance thereof. (c) Unless otherwise provided, the principal corporate trust offices of the Paying Agents are designated as the respective offices or agencies of SCPPA for the payment of the interest on and principal or Redemption Price of the Bonds. Section 9.03 Responsibilities of Fiduciaries. (a) The recitals of fact herein and in the Bonds contained shall be taken as the statements of SCPPA and no Fiduciary assumes any responsibility for the correctness of the same. No Fiduciary makes any representations as to the validity or sufficiency of this Indenture or of any Bonds issued thereunder or as to the security afforded by this Indenture, and no Fiduciary shall incur any liability in respect thereof. The Trustee shall, however, be responsible for its representation contained in its certificate of authentication on the Bonds. No Fiduciary shall be under any responsibility or duty with respect to the application of any moneys paid by such Fiduciary in accordance with the provisions of this Indenture to SCPPA or to any other Fiduciary. No Fiduciary shall be under any obligation or duty to perform any act which would involve it in expense or liability or to institute or defend any suit in respect thereof, or to advance any of its own moneys, unless properly indemnified. Subject to the provisions of subsection (b), no Fiduciary shall be liable in connection with the performance of its duties hereunder except for its own negligence or willful misconduct. 72

101 (b) The Trustee, prior to the occurrence of an Event of Default and after the curing of all Events of Default which may have occurred, undertakes to perform such duties and only such duties as are specifically set forth in this Indenture. In case an Event of Default has occurred (which has not been cured) the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs. Any provision of this Indenture relating to action taken or to be taken by the Trustee or to evidence upon which the Trustee may rely shall be subject to the provisions of this Section 9.03 and Section (c) SCPPA hereby authorizes and directs the Trustee to execute and deliver the Receivables Purchase Agreement in its capacity as Trustee hereunder. Section 9.04 Evidence on Which Fiduciaries May Act. (a) Each Fiduciary, upon receipt of any notice, direction, resolution, request, consent, order, certificate, report, opinion, bond or other paper or document furnished to it pursuant to any provision of this Indenture, shall examine such instrument to determine whether it conforms to the requirements of this Indenture and shall be protected in acting upon any such instrument believed by it in good faith to be genuine and to have been signed or presented by the proper party or parties. Each Fiduciary may consult with counsel, who may or may not be counsel to SCPPA, gas industry consultants or other experts selected with reasonable care, and the opinion of such counsel, consultants and experts shall be full and complete authorization and protection in respect of any action taken or suffered by it under this Indenture in good faith and in accordance therewith. (b) Whenever any Fiduciary shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering any action under this Indenture or the Collateral Agreement, such matter (unless other evidence in respect thereof be therein specifically prescribed) may be deemed to be conclusively proved and established by a Written Certificate of SCPPA, and such certificate shall be full warrant for any action taken or suffered in good faith under the provisions of this Indenture upon the faith thereof; but in its discretion the Fiduciary may in lieu thereof accept other evidence of such fact or matter or may require such further or additional evidence as it may deem reasonable. Neither the Trustee, the Bond Registrar nor the Paying Agent shall be bound to recognize any Person as a Bondholder or to take any action at its request unless its Bond shall be deposited with such entity or satisfactory evidence of the ownership of such Bond shall be furnished to such entity. Section 9.05 Compensation. Subject to any specific agreement between SCPPA and any Fiduciary, SCPPA shall pay or cause to be paid to each Fiduciary from time to time reasonable compensation for all services rendered under this Indenture, and also all reasonable expenses, charges, legal fees and other disbursements, including those of its attorneys, agents and employees, incurred in and about the performance of their powers and duties under this Indenture, in accordance with the agreements made from time to time between SCPPA and the Fiduciary. Subject to the provisions of Section 9.03, SCPPA further agrees, to the extent permitted by applicable law, to indemnify and save each Fiduciary harmless against any reasonable costs, expenses, claims or liabilities which it may incur in the exercise and performance of its powers and duties hereunder and which are not due to such Fiduciary s negligence or willful misconduct. Payments to the Fiduciaries shall be made from amounts on 73

102 deposit in the General Operating Fund and, if necessary and to the extent determined by SCPPA, the General Accounts in the General Fund. The obligation of SCPPA under this Section 9.05 shall survive the termination or discharge of this Indenture or the resignation or removal of the Trustee. Section 9.06 Certain Permitted Acts. Any Fiduciary, individually or otherwise, may become the owner of any Bonds, with the same rights it would have if it were not a Fiduciary. To the extent permitted by law, any Fiduciary may act as depository for, and permit any of its officers or directors to act as a member of, or in any other capacity with respect to, any committee formed to protect the rights of Bondholders or to effect or aid in any reorganization growing out of the enforcement of the Bonds or this Indenture, whether or not any such committee shall represent the Holders of a majority in principal amount of the Bonds then Outstanding. Section 9.07 Resignation of Trustee. The Trustee may at any time resign and be discharged of the duties created by this Indenture by giving not less than 120 days written notice to SCPPA and mailing notice thereof to the Holders of Bonds then Outstanding, specifying the date when such resignation shall take effect, and such resignation shall take effect upon the day specified in such notice unless (a) previously a successor shall have been appointed by SCPPA or the Bondholders as provided in Section 9.09, in which event such resignation shall take effect immediately on the appointment of such successor, or (b) a successor shall not have been appointed by SCPPA or the Bondholders as provided in Section 9.09 on such date, in which event such resignation shall not take effect until a successor is appointed. Section 9.08 Removal of the Trustee. The Trustee may be removed at any time with or without cause by an instrument or concurrent instruments in writing, filed with the Trustee, and signed by the Holders of a majority in principal amount of the Bonds then Outstanding or their attorneys-in-fact duly authorized, excluding any Bonds held by or for the account of SCPPA. So long as no Event of Default, or an event which, with notice or passage of time, or both, would become an Event of Default, shall have occurred and be continuing, the Trustee may be removed at any time, with or without cause, by delivery of a Written Certificate of SCPPA to the Trustee with respect to the foregoing. Notwithstanding the foregoing, any such removal of the Trustee shall not be effective until a successor Trustee has been appointed pursuant to Section Section 9.09 Appointment of Successor Trustee. (a) In case at any time the Trustee shall resign or shall be removed or shall become incapable of acting, or shall be adjudged bankrupt or insolvent, or if a receiver, liquidator or conservator of the Trustee, or of its property, shall be appointed, or if any public officer shall take charge or control of the Trustee, or of its property or affairs, a successor Trustee may be appointed by SCPPA by a duly executed written instrument signed by an Authorized Authority Representative, but if SCPPA does not appoint a successor Trustee within 60 days then by the Holders of a majority in principal amount of the Bonds then Outstanding, excluding any Bonds held by or for the account of SCPPA, by an instrument or concurrent instruments in writing signed and acknowledged by such Bondholders or by their attorneys-in-fact duly authorized and delivered to such successor Trustee, notification thereof being given to SCPPA and the predecessor Trustee. After such appointment of a successor Trustee, SCPPA shall mail notice of any such appointment by it or the Bondholders to the registered owners of the Bonds then Outstanding. 74

103 (b) If no appointment of a successor Trustee shall be made pursuant to the foregoing provisions of this Section within 120 days after the Trustee shall have given to SCPPA written notice as provided in Section 9.07 or after a vacancy in the office of the Trustee shall have occurred by reason of its inability to act, removal, or for any other reason whatsoever, the Trustee or the Holder of any Bond (in any case) may apply to any court of competent jurisdiction to appoint a successor Trustee. Said court may thereupon, after such notice, if any, as such court may deem proper, appoint a successor Trustee. (c) Any Trustee appointed under the provisions of this Section 9.09 in succession to the Trustee shall be a bank or trust company organized under the laws of any state or a national banking association and shall have capital stock, surplus and undivided earnings aggregating at least $500,000,000 if there be such a bank with trust powers or trust company or national banking association willing and able to accept the office on reasonable and customary terms and authorized by law to perform all the duties imposed upon it by this Indenture. Section 9.10 Transfer of Rights and Property to Successor Trustee. Any successor trustee appointed under this Indenture shall execute, acknowledge and deliver to its predecessor Trustee, and also to SCPPA, an instrument accepting such appointment, and thereupon such successor Trustee, without any further act, deed or conveyance, shall become fully vested with all moneys, estates, properties, rights, powers, duties and obligations of such predecessor Trustee, with like effect as if originally named as Trustee; but the Trustee ceasing to act shall nevertheless, on the Written Request of SCPPA or of the successor Trustee, execute, acknowledge and deliver such instrument of conveyance and further assurance and do such other things as may reasonably be required for more fully and certainly vesting and confirming in such successor Trustee all the right, title and interest of the predecessor Trustee in and to any property, rights, interests and estates held by it under this Indenture, and shall pay over, assign and deliver to the successor Trustee any money or other property subject to the trusts and conditions herein set forth. Should any deed, conveyance or instrument in writing from SCPPA be required by such successor Trustee for more fully and certainly vesting in and confirming to such successor Trustee any such estates, rights, powers and duties, any and all such deeds, conveyances and instruments in writing shall, on request, and so far as may be authorized by law, be executed, acknowledged and delivered by SCPPA. Any such successor Trustee shall promptly notify the Paying Agents of its appointment as Trustee. Section 9.11 Merger or Consolidation. Any company into which any Fiduciary may be merged or converted or with which it may be consolidated or any company resulting from any merger, conversion or consolidation to which it shall be a party or any company to which any Fiduciary may sell or transfer all or substantially all of its corporate trust business, provided such company shall be a bank with trust powers or trust company organized under the laws of any state of the United States or a national banking association and shall be authorized by law to perform all the duties imposed upon it by this Indenture and shall meet the qualifications set forth in Section 9.09(c), shall be the successor to such Fiduciary without the execution or filing of any paper or the performance of any further act. Section 9.12 Adoption of Authentication. In case any of the Bonds contemplated to be issued under this Indenture shall have been authenticated but not delivered, any successor Trustee may adopt the certificate of authentication of any predecessor Trustee so authenticating 75

104 such Bonds and deliver such Bonds so authenticated; and in case any of the said Bonds shall not have been authenticated, any successor Trustee may authenticate such Bonds in the name of the predecessor Trustee, or in the name of the successor Trustee, and in all such cases such certificate shall have the full force which it is provided, anywhere in said Bonds or in this Indenture, that the certificate of the Trustee shall have. Section 9.13 Resignation or Removal of Paying Agent and Appointment of Successor. (a) Any Paying Agent may at any time resign and be discharged of the duties and obligations created by this Indenture by giving at least 60 days written notice to SCPPA, the Trustee and the other Paying Agents. Any Paying Agent may be removed at any time by an instrument filed with such Paying Agent and the Trustee and signed by an Authorized Authority Representative. Any successor Paying Agent shall be appointed by SCPPA and shall be a bank or trust company organized under the laws of any state of the United States or a national banking association, having capital stock, surplus and undivided earnings aggregating at least $50,000,000, and willing and able to accept the office on reasonable and customary terms and authorized by law to perform all the duties imposed upon it by this Indenture. (b) In the event of the resignation or removal of any Paying Agent, such Paying Agent shall pay over, assign and deliver any moneys held by it as Paying Agent to its successor, or if there be no successor, to the Trustee. In the event that for any reason there shall be a vacancy in the office of any Paying Agent, the Trustee shall act as such Paying Agent. Section 9.14 Fiduciary s Reliance. In the absence of bad faith on its part, any Fiduciary may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to such Fiduciary and conforming to the requirements of this Indenture or the Collateral Agreement, as applicable. Section 9.15 Fiduciary s Liability. No Fiduciary shall be liable with respect to any action taken or omitted to be taken by it in good faith, in accordance with the provisions of this Indenture or the Collateral Agreement, as applicable, in accordance with the direction of the Holders of a majority in principal amount of the Outstanding Bonds, relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or, except for its negligence or willful misconduct, exercising any trust or power conferred upon the Trustee, under this Indenture with respect to the Bonds or under the Collateral Agreement. Section 9.16 Fiduciary s Agents or Attorneys. Any Fiduciary may execute any of its trusts or powers under this Indenture or the Collateral Agreement or perform any of its duties hereunder or thereunder either directly or by or through agents or attorneys appointed with reasonable care; provided that such Fiduciary shall be responsible for any misconduct or negligence on the part of any agent or attorney appointed by it hereunder or thereunder. Section 9.17 UCC Filings. Unless the Trustee shall have received an Opinion of Counsel reasonably acceptable to it that such filings are not necessary to maintain the perfection of the security interest granted under this Indenture and the Collateral Agreement, the Trustee shall file not less frequently than every five years Uniform Commercial Code Continuation Statements with the appropriate authorities and take such other actions as are necessary or 76

105 desirable in the reasonable opinion of the Trustee to maintain the perfection of the Trustee s security interest granted under this Indenture and the Collateral Agreement. ARTICLE X Supplemental Indentures Section Supplemental Indentures Not Requiring Consent of Bondholders. SCPPA and the Trustee may from time to time, subject to the conditions and restrictions in this Indenture contained, enter into a Supplemental Indenture or Indentures, in form reasonably satisfactory to the Trustee, which shall thereafter form a part hereof, without the consent of the Bondholders (but with the consent of the DSA Investment Agreement Provider to the extent required to avoid early termination of the DSA Investment Agreement) for any one or more of the following purposes: (a) To cure any ambiguity, supply any omission, or cure or correct any defect or inconsistent provision in this Indenture; (b) To insert such provisions clarifying matters or questions arising under this Indenture as are necessary or desirable and are not contrary to or inconsistent with this Indenture as theretofore in effect; (c) To make any other modification or amendment of this Indenture which the Trustee shall in its sole discretion determine will not have an adverse effect on the Bondholders; provided, however, that any consent from the Interest Rate Swap Counterparty under Section is first obtained; and provided further, however, that the Rating Agencies shall be provided written notice of any such modification of amendment not less than seven (7) days prior to the effectiveness of such modification or amendment; (d) To add to the covenants and agreements of SCPPA in this Indenture, other covenants and agreements to be observed by SCPPA which are not contrary to or inconsistent with this Indenture as theretofore in effect and which will not have an adverse effect on the Bondholders; (e) To add to the limitations and restrictions in this Indenture, other limitations and restrictions to be observed by SCPPA which are not contrary to or inconsistent with this Indenture as theretofore in effect; (f) To provide for the execution of a Commodity Swap or the Interest Rate Swap (other than the initial Commodity Swaps and the initial Interest Rate Swap) in accordance with the provisions hereof; (g) To confirm, as further assurance, any security interest, pledge or assignment under, and the subjection to any security interest, pledge or assignment created or to be created by, this Indenture of the Revenues or of any other moneys, securities or funds; Default; (h) To add to the Events of Default in this Indenture additional Events of 77

106 (i) To add to this Indenture any provisions relating to the application of interest earnings on any Fund or Account under this Indenture required by law to preserve the exclusion of interest on Bonds issued from gross income for federal income tax purposes; (j) To evidence the appointment of a successor Trustee; or (k) If the Bonds affected by such change are rated by a Rating Agency, to make any change upon receipt of a Rating Confirmation with respect to the Bonds so affected. In making any determination under subsection (c), the Trustee may rely upon an Opinion of Counsel and/or certificates of investment bankers or other financial professionals or consultants. Each Supplemental Indenture authorized by this Section shall become effective as of the date of its execution and delivery by SCPPA and the Trustee or such later date as shall be specified in such Supplemental Indenture, subject to the other provisions of this Article X. Section Supplemental Indentures Effective With Consent of Bondholders. At any time or from time to time, a Supplemental Indenture may be entered into by SCPPA and the Trustee subject to notice to and consent by Bondholders in accordance with and subject to the provisions of Article XI, which Supplemental Indenture, upon compliance with the provisions of said Article XI, shall become fully effective in accordance with its terms as provided in said Article XI. Section General Provisions. (a) This Indenture shall not be modified or amended in any respect except as provided in and in accordance with and subject to the provisions of this Article X and Article XI. Nothing contained in this Article X or Article XI shall affect or limit the right or obligation of SCPPA to adopt, make, do, execute, acknowledge or deliver any resolution, act or other instrument pursuant to the provisions of Section 7.04 or the right or obligation of SCPPA to execute and deliver to any Fiduciary any instrument which elsewhere in this Indenture it is provided shall be delivered to said Fiduciary. (b) Any Supplemental Indenture referred to and permitted or authorized by Section may be entered into between SCPPA and the Trustee without the consent of any of the Bondholders, but shall become effective only on the conditions, to the extent and at the time provided in said Section. The copy of every Supplemental Indenture shall be accompanied by an Opinion of Counsel stating that such Supplemental Indenture has been duly and lawfully executed in accordance with the provisions of this Indenture, is authorized or permitted by this Indenture, and is valid and binding upon SCPPA and enforceable in accordance with its terms; provided, that such Opinion of Counsel may take exception as to the effect of, or for restrictions or limitations imposed by or resulting from, bankruptcy, insolvency, debt adjustment, moratorium, reorganization or other similar laws affecting creditors rights generally and judicial discretion, the valid exercise of the sovereign police powers of the State and of the constitutional power of the United States of America and other customary exceptions and may state that no opinion is being rendered as to the availability of any particular remedy. (c) The Trustee is hereby authorized to enter into any Supplemental Indenture referred to and permitted or authorized by Section or and to make all further 78

107 agreements and stipulations which may be therein contained, and the Trustee, in taking such action, shall be fully protected in relying on an Opinion of Counsel that such Supplemental Indenture is authorized or permitted by the provisions of this Indenture. (d) No Supplemental Indenture shall change or modify any of the rights or obligations of any Fiduciary without its written assent thereto; provided, however this section shall not affect the rights of the Holders or SCPPA to remove the Trustee as provided in Section 9.08 herein. (e) Notwithstanding Section hereof, no Supplemental Indenture (or other amendment to this Indenture) shall change or modify (i) the order of priority of deposits to the Operating Fund or the Working Capital Account as set forth in clauses (i) and (iii) of Section 5.05(a), respectively, (ii) the amount to be maintained in the Working Capital Account (as such amount may be reduced pursuant to Section 5.03(b)), or the purposes to which amounts on deposit in such Working Capital Account may be applied, as set forth in Section 5.03(b), (iii) the priority of the application of funds following an Event of Default as set forth in Section 8.03, or (iv) the definition of Operating Expenses, unless in each case the prior written consent of the Commodity Swap Counterparty has been obtained, and the Commodity Swap Counterparty shall have full right to enforce this provision. The foregoing to the contrary notwithstanding, the obligation set forth in this Section 10.03(e) to obtain the prior written consent of the Commodity Swap Counterparty shall only be required for changes and modifications set forth in (i) through (iv) above that would be in effect during such time as the Commodity Swaps are existing and in place or any amounts under the Commodity Swaps remain unpaid or any other claim in respect of the Commodity Swaps remains unresolved. ARTICLE XI Amendments Section Mailing. Any provision in this Article XI for the mailing of a notice or other paper to Bondholders shall be fully complied with if it is mailed postage prepaid only (a) to each registered owner of Bonds then Outstanding at its address, if any, appearing upon the registry books of the Bond Registrar, and (b) to the Trustee. Section Powers of Amendment. Any modification or amendment of this Indenture and of the rights and obligations of SCPPA and of the Holders of the Bonds thereunder, in any particular manner, may be made by a Supplemental Indenture, with the written consent given as provided in Section (a) of the Holders of not less than a majority in principal amount of Outstanding Bonds, and (b) in case the modification or amendment changes the terms of any Sinking Fund Installment, of the Holders of not less than a majority in principal amount of Outstanding Bonds of the particular maturity entitled to such Sinking Fund Installment; provided, however, that if such modification or amendment will, by its terms, not take effect so long as any Bonds of any specified like maturity remain Outstanding (or are subject to mandatory purchase) the consent of the Holders of such Bonds shall not be required and such Bonds shall not be deemed to be Outstanding for the purpose of any calculation of Outstanding Bonds under this Section; and provided further, however, that if such modification or amendment would adversely affect the Interest Rate Swap Counterparty, such modification or 79

108 amendment shall be subject to the prior written consent of the Interest Rate Swap Counterparty; and provided further, however, that such modification or amendment shall be subject to the prior written consent of the DSA Investment Agreement Provider to the extent required to avoid early termination of the DSA Investment Agreement. No such modification or amendment, and no Supplemental Indenture described in clauses (c) or (k) of Section 10.01, shall permit a change in the terms of redemption or maturity of the principal of any Outstanding Bond or of any installment of interest thereon or a reduction in the principal amount or the Redemption Price thereof or in the rate of interest thereon without the consent of the Holder of such Bond, or shall reduce the percentages or otherwise affect the classes of Bonds the consent of the Holders of which is required to effect any such modification or amendment, or shall change or modify any of the rights or obligations of any Fiduciary without its written assent thereto. For the purposes of this Section, the Bonds shall be deemed to be affected by a modification or amendment of this Indenture if the same adversely affects or diminishes the rights of the Holders of Bonds in any material respect. The Trustee may in its discretion determine whether or not in accordance with the foregoing powers of amendment Bonds would be materially affected by any modification or amendment of this Indenture and any such determination shall be binding and conclusive on SCPPA and all Holders of Bonds. For purposes of this Section, the Holders of any Bonds may include the initial Holders thereof, regardless of whether such Bonds are being held for resale. Section Consent of Bondholders. SCPPA and the Trustee may at any time enter into a Supplemental Indenture making a modification or amendment permitted by the provisions of Section to take effect when and as provided in this Section A copy of such Supplemental Indenture (or brief summary thereof or reference thereto in form approved by the Trustee), together with a request to Bondholders for their consent thereto in form reasonably satisfactory to the Trustee, shall be mailed by SCPPA to Bondholders (but failure to mail such copy and request shall not affect the validity of the Supplemental Indenture when consented to as in this Section provided). Such Supplemental Indenture shall not be effective unless and until there shall have been filed with the Trustee (a) the written consents of Holders of the percentages of Outstanding Bonds specified in Section and of the Interest Rate Swap Counterparty and/or the DSA Investment Agreement Provider, if applicable, under Section and (b) an Opinion of Counsel stating that such Supplemental Indenture has been duly and lawfully executed by SCPPA in accordance with the provisions of this Indenture, is authorized or permitted by this Indenture, and is valid and binding upon SCPPA and enforceable in accordance with its terms, subject to any applicable bankruptcy, insolvency or other laws affecting creditors rights generally and may state that no opinion is being rendered as to the availability of any particular remedy. For purposes of clause (a) of the preceding sentence, the written consent of the Bondholder shall be deemed to have been received if the amendment is expressly referred to in the Supplemental Indenture authorizing such Bonds and in the text of such Bonds and such Bonds recite that such Bondholder shall be deemed to have consented to such amendments by accepting such Bonds. Otherwise, each such consent shall be effective only if accompanied by proof of the holding, at the date of such consent, of the Bonds with respect to which such consent is given, which proof shall be such as is permitted by Section A certificate or certificates executed by the Trustee and filed with the Trustee and SCPPA stating that it has examined such proof and that such proof is sufficient in accordance with Section shall be conclusive that the consents have been given by the Holders of the Bonds described in such certificate or certificates of the Trustee. Any such consent shall be irrevocable and shall be binding upon the Holder of the Bonds giving such consent and, anything in Section to the contrary 80

109 notwithstanding, upon any subsequent Holder of such Bonds and of any Bonds issued in exchange therefor (whether or not such subsequent Holder thereof has notice of such consent). At any time after the Holders of the required percentages of Bonds shall have filed their consents to the Supplemental Indenture (or have deemed to have consented to such Supplemental Indenture), the Trustee shall make and file with the Trustee and SCPPA a written statement that the Holders of such required percentages of Bonds have consented to, such Supplemental Indenture. Such written statements shall be conclusive that such consents have been received. At any time thereafter, notice stating in substance that the Supplemental Indenture (which may be referred to as a Supplemental Indenture entered into by SCPPA and the Trustee on a stated date, a copy of which is on file with the Trustee) has been consented to by the Holders of the required percentages of Bonds and will be effective as provided in this Section 11.03, may be given to Bondholders by the Trustee by mailing such notice to Bondholders (but failure to mail such notice shall not prevent such Supplemental Indenture from becoming effective and binding as in this Section provided). A record, consisting of the certificates or statements required or permitted by this Section to be made by the Trustee, shall be proof of the matters therein stated. Section Notifications by Unanimous Consent. The terms and provisions of this Indenture and the rights and obligations of SCPPA and of the Holders of the Bonds thereunder may be modified or amended in any respect upon the execution of a Supplemental Indenture by the Trustee and SCPPA and the consent of (a) the Holders of all of the Bonds then Outstanding, such consent to be given as provided in Section and (b) the Interest Rate Swap Counterparty and/or the DSA Investment Agreement Provider, if required, under Section 11.02; provided, however, that no such modification or amendment shall change or modify any of the rights or obligations of any Fiduciary without the filing with the Trustee of the written assent thereto of such Fiduciary in addition to the consent of the Bondholders. Section Exclusion of Bonds. (a) Bonds owned or held by or for the account of SCPPA shall not be deemed Outstanding for the purpose of consent or other action or any calculation of Outstanding Bonds provided for in this Article XI, and SCPPA shall not be entitled with respect to such Bonds to give any consent or take any other action provided for in this Article XI. At the time of any consent or other action taken under this Article XI, SCPPA shall furnish the Trustee a certificate of an Authorized Authority Representative, upon which the Trustee may rely, describing all Bonds so to be excluded. (b) Bonds for which a Bondholder has submitted a notice of abstention in response to a request for consent received pursuant to Section shall not be deemed Outstanding for the purpose of consent or other action or any calculation of Outstanding Bonds provided for in this Article XI with respect to any Supplemental Indenture to be entered into by SCPPA and the Trustee. Section Notation on Bonds. Bonds authenticated and delivered after the effective date of any action taken as in Article X or this Article XI provided may, and, if the Trustee so determines, shall, bear a notation by endorsement or otherwise in form approved by SCPPA and the Trustee as to such action, and in that case upon demand of the Holder of any Bond Outstanding at such effective date and presentation of its Bond for the purpose at the principal corporate trust office of the Trustee or upon any transfer or exchange of any Bond Outstanding at 81

110 such effective date, suitable notation shall be made on such Bond or upon any Bond issued upon any such transfer or exchange by the Trustee as to any such action. If SCPPA or the Trustee shall so determine, new Bonds so modified as in the opinion of the Trustee and SCPPA to conform to such action shall be prepared, authenticated and delivered, and upon demand of the Holder of any Bond then Outstanding shall be exchanged, without cost to such Bondholder, for Bonds of the same maturity then Outstanding, upon surrender of such Bonds. ARTICLE XII Miscellaneous Section Defeasance. (a) If SCPPA shall pay or cause to be paid, or there shall otherwise be paid, to the Holders of all Bonds the principal or Redemption Price, if applicable, and interest due or to become due thereon, at the times and in the manner stipulated in the Bonds and in this Indenture, then the pledge of all covenants, agreements and other obligations of SCPPA to the Bondholders, shall thereupon cease, terminate and be discharged and satisfied except for remaining rights of registration of transfer and exchange of Bonds; provided, however, that this Indenture shall not be discharged until SCPPA shall have paid and satisfied all claims, charges and expenses that constitute Operating Expenses hereunder and allor Interest Rate Swap Payments or that relate to the obligations of SCPPA or the Trustee to repurchase from the Gas Supplier Identified Receivables or the payment to the Gas Supplier of RPA Accrued Interest. In such event, the Trustee shall cause an accounting for such period or periods as shall be requested by SCPPA to be prepared and filed with SCPPA and, upon the request of SCPPA, shall execute and deliver to SCPPA all such instruments as may be desirable to evidence such discharge and satisfaction, and the Fiduciaries shall pay over or deliver to SCPPA all moneys or securities held by them pursuant to this Indenture which are not required for the payment of principal or Redemption Price, if applicable, on Bonds not theretofore surrendered for such payment or redemption. If SCPPA shall pay or cause to be paid, or there shall otherwise be paid, to the Holders of any Outstanding Bonds the principal or Redemption Price, if applicable, and interest due or to become due thereon, at the times and in the manner stipulated therein and in this Indenture, such Bonds shall cease to be entitled to any lien, benefit or security under this Indenture, and all covenants, agreements and obligations of SCPPA to the Holders of such Bonds shall thereupon cease, terminate and be discharged and satisfied except for remaining rights of registration of transfer and exchange of Bonds. (b) Bonds or interest installments for the payment or redemption of which moneys shall have been set aside and shall be held in trust by the Paying Agents (through deposit by SCPPA of funds for such payment or redemption or otherwise) at the maturity or redemption date thereof shall be deemed to have been paid within the meaning and with the effect expressed in subsection (a). In addition, any Outstanding Bonds shall prior to the maturity or redemption date thereof be deemed to have been paid within the meaning and with the effect expressed in subsection (a) upon compliance with the provisions of subsection (c). (c) Subject to the provisions of subsection (d) of this Section, any Outstanding Bonds shall prior to the maturity or redemption date thereof be deemed to have been paid within the meaning and with the effect expressed in subsection (a) of this Section if (i) in case any of said Bonds are to be redeemed on any date prior to their maturity, SCPPA shall have given to the 82

111 Trustee irrevocable instructions accepted in writing by the Trustee to mail as provided in Article IV notice of redemption of such Bonds (other than Bonds which have been purchased by the Trustee at the direction of SCPPA or purchased or otherwise acquired by SCPPA and delivered to the Trustee as hereinafter provided prior to the mailing of such notice of redemption) on said date, (ii) there shall have been deposited with the Trustee either moneys (including moneys withdrawn and deposited pursuant to Section 5.07(f)) in an amount which shall be sufficient, or Defeasance Securities (including any Defeasance Securities issued or held in book-entry form on the books of the Department of the Treasury of the United States) the principal of and the interest on which when due will provide moneys which, together with the moneys, if any, deposited with the Trustee at the same time, shall be sufficient, to pay when due the principal or Redemption Price, if applicable, and interest due and to become due on said Bonds (assuming that the rate of interest on the Index Rate Bonds shall be at the Maximum Rate) on or prior to the redemption date or maturity date thereof, as the case may be, and (iii) in the event said Bonds are not by their terms subject to redemption within the next succeeding 60 days, SCPPA shall have given the Trustee in form reasonably satisfactory to it irrevocable instructions to mail, as soon as practicable, a notice to the Holders of such Bonds at their last addresses appearing upon the registry books at the close of business on the last Business Day of the Month preceding the Month for which notice is mailed that the deposit required by (ii) above has been made with the Trustee and that said Bonds are deemed to have been paid in accordance with this Section and stating such maturity or redemption date upon which moneys are expected, subject to the provisions of subsection (d) of this Section 12.01, to be available for the payment of the principal or Redemption Price, if applicable, on said Bonds (other than Bonds which have been purchased by the Trustee at the direction of SCPPA or purchased or otherwise acquired by SCPPA and delivered to the Trustee as hereinafter provided prior to the mailing of the notice of redemption referred to in clause (i)). Any notice of redemption mailed pursuant to the preceding sentence with respect to Bonds which constitute less than all of the Outstanding Bonds of any maturity shall specify the letter and number or other distinguishing mark of each such Bond. The Trustee shall, as and to the extent necessary, apply moneys held by it pursuant to this Section to the retirement of said Bonds in amounts equal to the unsatisfied balances (determined as provided in Section 4.02(c)) of any Sinking Fund Installments with respect to such Bonds, all in the manner provided in this Indenture. The Trustee shall, if so directed by SCPPA (A) prior to the maturity date of Bonds deemed to have been paid in accordance with this Section which are not to be redeemed prior to their maturity date or (B) prior to the mailing of the notice of redemption referred to in clause (i) above with respect to any Bonds deemed to have been paid in accordance with this Section which are to be redeemed on any date prior to their maturity, apply moneys deposited with the Trustee in respect of such Bonds and redeem or sell Defeasance Securities so deposited with the Trustee and apply the proceeds thereof to the purchase of such Bonds and, the Trustee shall immediately thereafter cancel all such Bonds so purchased; provided, however, that the moneys and Defeasance Securities remaining on deposit with the Trustee after the purchase and cancellation of such Bonds (or the deemed cancellation thereof) shall be sufficient to pay when due the Principal Installment or Redemption Price, if applicable, and interest due or to become due on all Bonds (assuming that the rate of interest on the Index Rate Bonds shall be at the Maximum Rate), in respect of which such moneys and Defeasance Securities are being held by the Trustee on or prior to the redemption date or maturity date thereof, as the case may be. If, at any time (1) prior to the maturity date of Bonds deemed to have been paid in accordance with Section which 83

112 are not to be redeemed prior to their maturity date or (2) prior to the mailing of the notice of redemption referred to in clause (i) with respect to any Bonds deemed to have been paid in accordance with this Section which are to be redeemed on any date prior to their maturity, SCPPA shall purchase or otherwise acquire any such Bonds and deliver such Bonds to the Trustee prior to their maturity date or redemption date, as the case may be, the Trustee shall immediately cancel all such Bonds so delivered; such delivery of Bonds to the Trustee shall be accompanied by directions from SCPPA to the Trustee as to the manner in which such Bonds are to be applied against the obligation of the Trustee to pay or redeem Bonds deemed paid in accordance with this Section The directions given by SCPPA to the Trustee referred to in the preceding sentences shall also specify the portion, if any, of such Bonds so purchased or delivered and cancelled or deemed cancelled to be applied against the obligation of the Trustee to pay Bonds deemed paid in accordance with this Section upon their maturity date or dates and the portion, if any, of such Bonds so purchased or delivered and cancelled or deemed cancelled to be applied against the obligation of the Trustee to redeem Bonds deemed paid in accordance with this Section on any date or dates prior to their maturity. In the event that on any date as a result of any purchases, acquisitions and cancellations or deemed cancellations of Bonds as provided in this Section the total amount of moneys and Defeasance Securities remaining on deposit with the Trustee under this Section is in excess of the total amount which would have been required to be deposited with the Trustee on such date in respect of the remaining Bonds in order to satisfy clause (ii) of this subsection (c) of Section 12.01, the Trustee shall, if requested by SCPPA, pay the amount of such excess to SCPPA free and clear of any trust, lien, security interest, pledge or assignment securing said Bonds or otherwise existing under this Indenture. Except as otherwise provided in subsections (c) and (d) of this Section 12.01, neither Defeasance Securities nor moneys deposited with the Trustee pursuant to this Section nor principal or interest payments on any such Defeasance Securities shall be withdrawn or used for any purpose other than, and shall be held in trust for, the payment of the principal or Redemption Price, if applicable, and interest on said Bonds; provided that any cash received from such principal or interest payments on such Defeasance Securities deposited with the Trustee, (x) to the extent such cash will not be required at any time for such purpose, shall be paid over to SCPPA as received by the Trustee, free and clear of any trust, lien or pledge securing said Bonds or otherwise existing under this Indenture, and (y) to the extent such cash will be required for such purpose at a later date, shall, to the extent practicable, be reinvested in Qualified Investments maturing at times and in amounts sufficient to pay when due the principal or Redemption Price, if applicable, and interest to become due on said Bonds on or prior to such redemption date or maturity date thereof, as the case may be, and interest earned from such reinvestments shall be paid over to SCPPA, as received by the Trustee, free and clear of any trust, lien, security interest, pledge or assignment securing said Bonds or otherwise existing under this Indenture. (d) Anything in this Indenture to the contrary notwithstanding, any moneys held by a Fiduciary in trust for the payment and discharge of any of the Bonds which remain unclaimed for two years after the date when such Bonds have become due and payable, either at their stated maturity dates or by call for earlier redemption, if such moneys were held by the Fiduciary at such date, or for two years after the date of deposit of such moneys if deposited with the Fiduciary after the said date when such Bonds became due and payable, shall, at the Written Request of SCPPA, be repaid by the Fiduciary to SCPPA, as its absolute property and free from trust, and the Fiduciary shall thereupon be released and discharged with respect thereto and the 84

113 Bondholders shall look only to SCPPA for the payment of such Bonds; provided, however, that before being required to make any such payment to SCPPA the Fiduciary shall, at the expense of SCPPA, cause to be published at least twice, at an interval of not less than seven days between publications, in the Authorized Newspaper, a notice that said moneys remain unclaimed and that, after a date named in said notice, which date shall be not less than 30 days after the date of the first publication of such notice, the balance of such moneys then unclaimed will be returned to SCPPA. Section Evidence of Signatures of Bondholders and Ownership of Bonds. (a) Any request, consent, revocation of consent or other instrument which this Indenture may require or permit to be signed and executed by the Bondholders may be in one or more instruments of similar tenor, and, except as otherwise provided in Section 11.03, shall be signed or executed by such Bondholders in person or by their attorneys appointed in writing. Proof of (1) the execution of any such instrument, or of an instrument appointing any such attorney, or (2) the holding by any Person of the Bonds shall be sufficient for any purpose of this Indenture (except as otherwise therein expressly provided) if made in the following manner, or in any other manner satisfactory to the Trustee, which may nevertheless in its discretion require further or other proof in cases where it deems the same desirable: (i) The fact and date of the execution by any Bondholder or its attorney of such instruments may be proved by a guarantee of the signature thereon by a bank or trust company or by the certificate of any notary public or other officer authorized to take acknowledgments of deeds, that the Person signing such request or other instrument acknowledged to him or her the execution thereof, or by an affidavit of a witness of such execution, duly sworn to before such notary public or other officer. Where such execution is by an officer of a corporation or association or a member of a partnership, on behalf of such corporation, association or partnership, such signature, guarantee, certificate or affidavit shall also constitute sufficient proof of its authority. (ii) The amount of Bonds transferable by delivery held by any Person executing any instrument as a Bondholder, the date of holding such Bonds, and the numbers and other identification thereof, may be proved by a certificate, which need not be acknowledged or verified, in form reasonably satisfactory to the Trustee, executed by the Trustee or by a member of a financial firm or by an officer of a bank, trust company, insurance company, or financial corporation or other depository wherever situated, showing at the date therein mentioned that such Person exhibited to such member or officer or had on deposit with such depository the Bonds described in such certificate. Such certificate may be given by a member of a financial firm or by an officer of any bank, trust company, insurance company or financial corporation or depository with respect to Bonds owned by it, if acceptable to the Trustee. In addition to the foregoing provisions, the Trustee may from time to time make such reasonable regulations as it may deem advisable permitting other proof of holding of Bonds transferable by delivery. (b) The ownership of Bonds registered otherwise than to bearer and the amount, numbers and other identification, and date of holding the same shall be proved by the registry books. 85

114 (c) Any request or consent by the owner of any Bond shall bind all future owners of such Bond in respect of anything done or suffered to be done by SCPPA or any Fiduciary in accordance therewith. Section Moneys Held for Particular Bonds. The amounts held by any Fiduciary for the payment of the interest, principal or Redemption Price due on any date with respect to particular Bonds shall, on and after such date and pending such payment, be set aside on its books and held in trust by it for the Holders of the Bonds entitled thereto. Section Preservation and Inspection of Documents. All documents received by any Fiduciary under the provisions of this Indenture shall be retained in its possession and shall be subject at all reasonable times to the inspection of SCPPA, any other Fiduciary, and any Bondholder and their agents and their representatives, any of whom may make copies thereof at their expense. Section Parties Interested Herein. Nothing in this Indenture expressed or implied, except as otherwise provided in Section 10.03(e), is intended or shall be construed to confer upon, or to give to, any Person or corporation, other than SCPPA, the Fiduciaries, the Holders of the Bonds, any Depository, the Commodity Swap Counterparty and the Interest Rate Swap Counterparty, any right, remedy or claim under or by reason of this Indenture or any covenant, condition or stipulation thereof; and all the covenants, stipulations, promises and agreements in this Indenture contained by and on behalf of SCPPA shall be for the sole and exclusive benefit of SCPPA, the Fiduciaries, the Holders of the Bonds, any Depository, the Commodity Swap Counterparty and the Interest Rate Swap Counterparty. Section No Recourse on the Bonds. No recourse shall be had for the payment of the principal of or interest on the Bonds or for any claim based thereon or on this Indenture against any Project Participant (except as otherwise provided in the last sentence of this Section 12.06), any member of the Board or officer of SCPPA or any member of the governing body or officer of any Project Participant or any Person executing the Bonds. The Bonds shall be limited, non-recourse obligations of SCPPA payable solely from, and secured as to the payment of the principal and Redemption Price thereof, and interest thereon, in accordance with their terms and the provisions of this Indenture solely by, the Trust Estate. The payment of the principal and Redemption Price of the Bonds, and interest thereon, is not an obligation of the Project Participants, whose obligations are limited to their obligations to SCPPA under the respective Gas Supply Contracts, including payments thereunder. Section Publication of Notice; Suspension of Publication. (a) Any publication to be made under the provisions of this Indenture in successive weeks or on successive dates may be made in each instance upon any Business Day of the week and need not be made in the same Authorized Newspaper for any or all of the successive publications but may be made in a different Authorized Newspaper. (b) If, because of the temporary or permanent suspension of the publication or general circulation of any Authorized Newspaper or for any other reason, it is impossible or impractical to publish any notice pursuant to this Indenture in the manner herein provided, then 86

115 such publication in lieu thereof as shall be made with the approval of the Trustee shall constitute a sufficient publication of such notice. Section Severability of Invalid Provisions. If any one or more of the covenants or agreements provided in this Indenture on the part of SCPPA or any Fiduciary to be performed should be contrary to law, then such covenant or covenants or agreement or agreements shall be deemed severable from the remaining covenants and agreements, and shall in no way affect the validity of the other provisions of this Indenture. Section Holidays. If the date for making any payment or the last date for performance of any act or the exercising of any right, as provided in this Indenture, shall not be a Business Day, such payment may be made or act performed or right exercised on the next succeeding Business Day with the same force and effect as if done on the nominal date provided in this Indenture, and no interest shall accrue for the period after such nominal date. Section Notices. Except as otherwise provided herein, all notices, requests, demands and other communications required or permitted under this Indenture shall be deemed to have been duly given if delivered or mailed, first class, postage prepaid (or sent by facsimile, and deemed effective upon the sender s receipt of confirmation of successful transmission), as follows: (a) (b) If to SCPPA: Southern California Public Power Authority 225 South Lake Avenue, Suite Nicole Court PasadenaGlendora, California Attention: Executive Director FAX: (626) If to the Trustee: U.S. Bank National Association 633 West Fifth Street Los Angeles, California Attention: Corporate Trust Department FAX: (213) or to such other Person or addresses as the respective party hereafter designates in writing to SCPPA and the Trustee. In addition to the foregoing, the parties hereto may agree in writing at any time to deliver notices, demands, requests or other communications through alternate methods, including, but not limited to, electronic mail. Section Notices to Rating Agencies. SCPPA shall provide to each Rating Agency then rating the Bonds: (a) notice of any Supplemental Indenture (including pursuant to Section 10.01(c)), with any notice to Moody s pursuant to Section 10.01(c) being sent to: Moody s Investors Service; c/o Municipal Structured Products Group; 7 World Trade Center at 250 Greenwich Street; New York, New York or an amendment of any Gas Purchase Agreement, any Commodity Swap, any Interest Rate Swap, any Gas Supply Contract, any Surety 87

116 Bond, any Financial Guaranty Agreement, the Collateral Agreement, the Gas Supplier Guarantee or the Receivables Purchase Agreement; (b) each material event notice provided to any Nationally Recognized Municipal Securities Information Repository pursuant to the continuing disclosure undertaking or resolution executed by SCPPA in connection with the issuance of the Bonds; and (c) each annual accounting delivered by SCPPA to its Project Participants pursuant to the Gas Supply Contracts. Section Counterparts. This Indenture may be executed in multiple counterparts, each of which shall be regarded for all purposes as an original; and such counterparts shall constitute but one and the same instrument. 88

117 IN WITNESS WHEREOF, Southern California Public Power Authority has caused this Indenture to be signed in its own name and on its behalf by its President and its seal to be hereunto affixed, affixed by the Secretary or Assistant Secretary of SCPPA, and as evidence of its acceptance of the trusts hereby created, U.S. Bank National Association has caused this Indenture to be signed in its name and on its behalf by one of its officers duly authorized, all as of the date first above written. SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY By President [SEAL] ATTEST Assistant Secretary U.S. BANK NATIONAL ASSOCIATION, as Trustee By Authorized Officer

118 Exhibit A FORM OF BONDS Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation ( DTC ), to SCPPA or its agent for registration of transfer, exchange, or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein. REGISTERED REGISTERED No. [A][B] - $ UNITED STATES OF AMERICA STATE OF CALIFORNIA SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY GAS PROJECT REVENUE BOND (PROJECT NO. 1), SERIES 2007[A][B] MATURITY DATE ISSUE DATE CUSIP INTEREST RATE November 1, 20 October 11, % REGISTERED OWNER: CEDE & CO. PRINCIPAL AMOUNT: DOLLARS Southern California Public Power Authority ( SCPPA ), established pursuant to the laws of the State of California, acknowledges itself indebted and for value received hereby promises to pay, in the manner and from the source hereinafter provided, to the registered owner identified above, or registered assigns, on the Maturity Date stated above, unless this Bond shall have been called for redemption and payment of the Redemption Price shall have been duly made or provided for, upon presentation and surrender hereof, the principal amount identified above, and A-1

119 to pay, in the manner and from the source hereinafter provided, to the registered owner hereof interest on the balance of said principal amount from time to time remaining unpaid at the per annum rate [set forth above] [calculated in accordance with the Indenture], until payment in full of such principal amount. The following paragraph shall be inserted in the Series 2007B Bonds, and the phrase LIBOR Index Rate shall be inserted under the caption Interest Rate immediately below the title of such Bond: This Bond bears interest from the Issue Date specified above, or from the most recent Interest Payment Date herefor to which interest hereon has been paid or duly provided for, to each subsequent Interest Payment Date herefor at the per annum rate specified in the Indenture referred to herein, in the case of the first such interest period, and for each subsequent such interest period at 67% of the Three-Month LIBOR Rate for such period plus 1.47 per annum (but not more than the Maximum Rate), each as defined in the Indenture, computed on the basis of a 365-or 366-day year, as applicable, for the actual number of days elapsed and payable on each February 1, May 1, August 1 and November 1, commencing February 1, 2008, and the Regular Record Date therefor is the last day (whether or not a business day) of the immediately preceding month. SCPPA IS OBLIGATED TO PAY THE PRINCIPAL OF, REDEMPTION PRICE OF, AND INTEREST ON THIS BOND SOLELY FROM THE REVENUES (AS SUCH TERM IS DEFINED IN THE INDENTURE HEREINAFTER REFERRED TO) AND OTHER FUNDS OF SCPPA PLEDGED THEREFOR IN ACCORDANCE WITH THE PROVISIONS OF THE INDENTURE. THIS BOND IS NOT A DEBT OF SCPPA OR ANY PUBLIC AGENCY WITHIN THE MEANING OF ANY CONSTITUTIONAL OR STATUTORY LIMITATION OF INDEBTEDNESS. PURSUANT TO THE INDENTURE, SUFFICIENT REVENUES AND OTHER FUNDS OF SCPPA PLEDGED THEREFOR IN ACCORDANCE WITH THE PROVISIONS OF THE INDENTURE ARE TO BE PLEDGED AND TO BE SET ASIDE INTO SPECIAL FUNDS BY SCPPA TO PROVIDE FOR THE PROMPT PAYMENT OF THE PRINCIPAL OF AND INTEREST ON THIS BOND AND ALL BONDS OF THE SERIES OF WHICH IT IS A PART. THIS BOND SHALL NOT BE A DEBT OF ANY POLITICAL SUBDIVISION OR OF THE STATE OF CALIFORNIA AND NEITHER THE STATE OF CALIFORNIA NOR ANY POLITICAL SUBDIVISION SHALL BE LIABLE THEREON. THIS BOND SHALL BE PAYABLE ONLY OUT OF THE FUNDS PROVIDED FOR UNDER THE INDENTURE. This Bond and the issue of Bonds of which it is a part are issued in conformity with and after full compliance with the Constitution of the State of California and pursuant to the joint exercise of powers found in Chapter 5 of Division 7 of Title 1 of the Government Code of California, as amended (the Act ). This Bond is a limited, non-recourse obligation of SCPPA and is one of the Gas Project Revenue Bonds (Project No. 1) of SCPPA (the Bonds ) issued under and by virtue of the Act and under and pursuant to aan Amended and Restated Trust Indenture, dated as of October 1, 2007[,] 2013 (the Indenture ), between SCPPA and U.S. Bank National A-2

120 Association, as trustee (said trustee and any successor thereto under the Indenture being herein referred to as the Trustee ), as the same may be amended and supplemented from time to time, for the purpose of providing funds to acquire a supply of natural gas for the Project Participants and to pay related expenses. This Bond is one of a Series of Bonds designated as Gas Project Revenue Bonds (Project No. 1), Series 2007[A][B], limited to the aggregate principal amount of $, dated as of the dated date identified above, and duly issued under and by virtue of the Act and under and pursuant to the Indenture. No recourse shall be had for the payment of the principal of or interest on this Bond or for any claim based thereon or on the Indenture against any Project Participant (except as otherwise provided in the last sentence of this paragraph), any member of the Board or officer of SCPPA or any member of the governing body or officer of any Project Participant or any Person executing this Bond. This Bond is a limited, non-recourse obligation of SCPPA payable solely from, and secured as to the payment of the principal and Redemption Price thereof, and interest thereon, in accordance with its terms and the provisions of the Indenture solely by, the Trust Estate. The payment of the principal and Redemption Price of this Bond, and interest thereon, is not an obligation of the Project Participants, whose obligations are limited to their obligations to SCPPA under the respective Gas Supply Contracts, including payments thereunder. All Bonds issued and to be issued under the Indenture are and will be equally and ratably secured by the pledge and covenants made therein, except as otherwise expressly provided or permitted in or pursuant to the Indenture. Copies of the Indenture are on file at the office of SCPPA in Pasadena, California, and at the designated corporate trust office of U.S. Bank National Association in Los Angeles, California, and reference to the Indenture and the Act is made for a description of the pledge and covenants securing the Bonds, the nature, manner and extent of enforcement of such pledge and covenants, the terms and conditions upon which the Bonds and certain other Bonds were issued simultaneously thereunder, and a statement of the rights, duties, immunities and obligations of SCPPA and of the Trustee. Such pledge and other obligations of SCPPA under the Indenture may be discharged at or prior to the maturity or redemption of the Bonds upon the making of provision for the payment thereof on the terms and conditions set forth in the Indenture. Except as otherwise provided herein and unless the context clearly indicates otherwise, words and phrases used herein shall have the same meanings as such words and phrases in the Indenture. SCPPA has established a book-entry system of registration for the Bonds. Except as specifically provided otherwise in the Indenture, a Securities Depository (or its nominee) will be the registered owner of this Bond. By acceptance of a confirmation of purchase, delivery or transfer, the Beneficial Owner of this Bond shall be deemed to have agreed to this arrangement. The Securities Depository (or its nominee), as registered owner of this Bond, shall be treated as the owner of it for all purposes. SCPPA will pay the principal of, Redemption Price of, and interest on this Bond wholly from the Revenues (as such term is defined in the Indenture) and other funds of SCPPA pledged therefor in accordance with the provisions of the Indenture. Interest will accrue on the unpaid A-3

121 portion of the principal of this Bond from the last date to which interest was paid or duly provided for or, if no interest thereon has been paid or duly provided for, from the date of the original issuance of the Bonds, until the entire principal amount of this Bond is paid or duly provided for, and such interest shall be paid in the manner and on the Interest Payment Dates for this Bond specified in the Indenture. The Bonds of each series are subject to acceleration or redemption prior to maturity upon the circumstances, at the times, in the amounts, upon payment of the amounts, with the notice, upon the other terms and provisions and with the effect set forth in the Indenture. This Bond may be transferred or exchanged as provided in the Indenture. SCPPA and the Trustee may treat and consider the Person in whose name this Bond is registered as the Holder and the absolute owner hereof for the purpose of receiving payment of, or on account of, the principal, purchase price or Redemption Price hereof and interest due hereon and for all other purposes whatsoever. To the extent and in the respects permitted by the Indenture, the Indenture may be modified or amended by action on behalf of SCPPA taken in the manner and subject to the conditions and exceptions prescribed in the Indenture. The Holder or Beneficial Owner of this Bond shall have no right to enforce the provisions of the Indenture or to institute action to enforce the pledge or covenants made therein or to take any action with respect to an Event of Default under the Indenture or to institute, appear in, or defend any suit or other proceeding with respect thereto, except as provided in the Indenture. It is hereby certified and recited that all conditions, acts and things required by the Constitution or statutes of the State of California or by the Act or the Indenture to exist, to have happened or to have been performed precedent to or in the issuance of this Bond exist, have happened and have been performed and that the issue of Bonds, together with all other indebtedness of SCPPA, is within every debt and other limit prescribed by said Constitution and statutes. This Bond shall not be valid until the Certificate of Authentication hereon shall have been signed by the Trustee. A-4

122 IN WITNESS WHEREOF, SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY has caused this Bond to be signed in its name and on its behalf by the manual or facsimile signature of its President, and its corporate seal to be impressed or printed hereto, and attested by the manual or facsimile signature of its Secretary or Assistant Secretary, all as of the issue date specified above. SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY By President ATTEST: By Assistant Secretary [SEAL] A-5

123 [FORM OF CERTIFICATE OF AUTHENTICATION] This Bond is one of the Bonds described in the within mentioned Indenture and is one of the Gas Project Revenue Bonds (Project No. 1), Series 2007[A][B], of Southern California Public Power Authority. Date of registration and authentication:, U.S. BANK NATIONAL ASSOCIATION, as Trustee By Authorized Authority Representative Customary abbreviations may be used in the name of a Bondholder or an assignee, such as TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian) and U/T/M/A (= Uniform Transfers to Minors Act). The following abbreviations, when used in the inscription on the face of the within Bond, shall be construed as though they were written out in full according to applicable laws or regulations: TEN COM as tenants in common UNIF TRAN MIN ACT TEN ENT as tenants by the entirety Custodian JT TEN as joint tenants with right (Cust) (Minor) of survivorship and not as under Uniform Transfers to Minors Act of tenants in common (State) Additional abbreviations may also be used though not in list above. A-6

124 [FORM OF ASSIGNMENT] For Value Received, the undersigned sells, assigns and transfers unto PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE (Name and Address of Assignee) the within Bond of SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY, and hereby irrevocably constitutes and appoints attorney to transfer the said Bond on the books kept for registration thereof with full power of substitution in the premises. Date: SIGNATURE GUARANTEED: Notice: Signature(s) must be guaranteed by an eligible guarantor institution meeting the requirements of the Trustee, which requirements include membership or participation in STAMP or such other signature guarantee program as may be determined by the Trustee in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended. NOTICE: The signature to this assignment must correspond with the name as it appears upon the face of the within Bond in every particular, without alteration or enlargement or any change whatever. A-7

125 City of Anaheim, California City of Burbank, California City of Colton, California City of Glendale, California City of Pasadena, California Schedule I SCHEDULE OF PROJECT PARTICIPANTS I-1

126 Schedule II SCHEDULED DEBT SERVICE DEPOSITS Month Scheduled Monthly Deposit Minimum Debt Service Fund Interest Earnings Accrual (1) Amounts are to be deposited on the last Business Day of the prior month. II-1 Debt Service Cumulative Scheduled Balance 10/11/ $15,063,057 11/01/ /01/ $103, /01/ , /01/ , /01/ , /01/ , /01/ ,285 - $(14,211,528) 06/01/2008-5, /01/2008-5, /01/2008-5, /01/2008 $3,889,190 5, /01/2008 3,945,393 21, /01/2008 3,740,423 37,541 - (12,790,376) 12/01/2008 2,235, /01/2009 1,981,748 9, /01/2009 2,196,528 17, /01/2009 2,259,846 26, /01/2009 2,054,451 35, /01/2009 2,213,609 44,401 - (12,790,376) 06/01/2009 2,003,400 1, /01/2009 2,057,780 9, /01/2009 2,326,335 17, /01/2009 3,999,016 27, /1/2009 $4,044,896 $43,963 - $15,253,171 11/1/2009 3,911,640 64,701 ($14,239,831) - 12/1/2009 2,391, ,391,433 1/1/2010 2,025,353 10,799-4,427,584 2/1/2010 1,828,132 16,358-6,272,074 3/1/2010 1,895,910 25,747-8,193,731 4/1/2010 1,714,675 33,635-9,942,041 5/1/2010 1,848,790 43,533 (8,474,206) 3,360,158 6/1/2010 1,667,649 12,874-5,040,681 7/1/2010 1,702,157 20,692-6,763,531 8/1/2010 1,961,619 28,690-8,753,839 9/1/2010 3,085,702 34,737-11,874,278 10/1/2010 3,106,189 48,744-15,029,211 11/1/2010 3,015,682 61,695 (14,189,206) - 12/1/2010 2,095, ,095,988 1/1/2011 1,695,552 9,178-3,800,717 2/1/2011 1,814,070 14,562-5,629,349 3/1/2011 1,833,340 23,108-7,485,798 4/1/2011 1,660,400 30,729-9,176,927

127 Month Scheduled Monthly Deposit Minimum Debt Service Fund Interest Earnings Accrual (1) Amounts are to be deposited on the last Business Day of the prior month. II-2 Debt Service Cumulative Scheduled Balance 5/1/2011 1,786,220 38,927 (8,331,331) 2,670,743 6/1/2011 1,636,463 10,598-4,317,803 7/1/2011 1,680,471 17,725-6,015,999 8/1/2011 1,935,750 24,696-7,976,445 9/1/2011 3,154,351 32,743-11,163,539 10/1/2011 3,202,162 48,881-14,414,582 11/1/2011 3,103,493 55,227 (13,626,331) - 12/1/2011 2,040, ,040,736 1/1/2012 1,625,400 8,936-3,675,072 2/1/2012 1,753,980 14,080-5,443,132 3/1/2012 1,822,304 22,344-7,287,780 4/1/2012 1,704,736 30,914-9,023,430 5/1/2012 1,772,704 35,806 (8,198,956) 2,632,984 6/1/2012 1,579,215 10,808-4,223,007 7/1/2012 1,630,538 17,913-5,871,459 8/1/2012 1,868,400 23,299-7,763,158 9/1/2012 3,031,011 35,055-10,829,223 10/1/2012 3,073,681 40,009-13,942,913 11/1/2012 2,969,942 57,236 (13,003,956) - 12/1/2012 1,548, ,548,642 1/1/2013 1,327,656 6,145-2,882,443 2/1/2013 1,442,929 11,438-4,336,810 3/1/2013 1,496,924 17,803-5,851,537 4/1/2013 1,352,061 24,021-7,227,618 5/1/2013 1,448,882 29,669 (8,078,831) 627,339 6/1/2013 1,266,420 2,747-1,896,505 7/1/2013 1,307,534 7,266-3,211,306 8/1/2013 1,469,851 13,182-4,694,339 9/1/2013 $2,518,399 $20,555 - $7,233,292 10/1/2013 2,563,141 27,713-9,824,147 11/1/2013 2,480,459 40,328 ($12,143,831) - 12/1/2013 1,503, ,503,473 1/1/2014 1,326,902 6,172-2,836,547 2/1/2014 1,447,981 12,032-4,296,559 3/1/2014 1,500,944 17,637-5,815,141 4/1/2014 1,355,691 22,280-7,193,112 5/1/2014 1,457,327 29,528 (7,977,206) 702,760 6/1/2014 1,260,336 2,981-1,966,077 7/1/2014 1,282,669 7,802-3,256,548 8/1/2014 1,442,095 13,368-4,712,011 9/1/2014 2,423,490 19,988-7,155,489 10/1/2014 2,445,737 28,394-9,629,620 11/1/2014 2,386,414 42,165 (11,852,206) - 12/1/2014 1,490, ,490,246 1/1/2015 1,309,817 6,321-2,806,384 2/1/2015 1,422,018 11,520-4,239,922 3/1/2015 1,482,251 17,405-5,739,578 4/1/2015 1,340,683 22,776-7,103,037

128 Month Scheduled Monthly Deposit Minimum Debt Service Fund Interest Earnings Accrual (1) Amounts are to be deposited on the last Business Day of the prior month. II-3 Debt Service Cumulative Scheduled Balance 5/1/2015 1,440,711 29,158 (7,880,331) 692,575 6/1/2015 1,277,263 2,843-1,972,681 7/1/2015 1,300,161 8,098-3,280,939 8/1/2015 1,459,128 14,366-4,754,434 9/1/2015 2,445,737 18,216-7,218,386 10/1/2015 2,465,961 29,631-9,713,979 11/1/2015 2,402,072 41,205 (11,955,331) - 12/1/2015 1,499, ,499,866 1/1/2016 1,321,877 6,773-2,828,515 2/1/2016 1,436,557 10,450-4,275,522 3/1/2016 1,476,020 17,551-5,769,093 4/1/2016 1,378,850 23,682-7,171,625 5/1/2016 1,426,172 30,421 (7,778,456) 849,762 6/1/2016 1,272,851 3,372-2,125,984 7/1/2016 1,293,418 8,727-3,428,130 8/1/2016 1,451,649 14,072-4,893,851 9/1/2016 2,433,416 20,089-7,347,356 10/1/2016 2,453,638 32,172-9,833,166 11/1/2016 2,386,231 37,674 (12,053,456) - 12/1/2016 1,492, ,492,551 1/1/2017 1,318,007 6,535-2,817,093 2/1/2017 1,436,835 10,793-4,264,722 3/1/2017 1,490,926 17,507-5,773,154 4/1/2017 1,341,005 25,279-7,139,438 5/1/2017 1,440,996 27,354 (7,671,581) 936,207 6/1/2017 1,287,732 3,843-2,227,782 7/1/2017 1,308,758 9,755-3,546,294 8/1/2017 1,468,779 13,587-5,028,660 9/1/2017 2,461,639 20,643-7,510,941 10/1/2017 2,481,894 31,860-10,024,695 11/1/2017 $2,413,594 $39,780 ($12,276,581) - 12/1/2017 1,518, $1,518,640 1/1/2018 1,340,393 6,442-2,865,475 2/1/2018 1,460,548 11,371-4,337,393 3/1/2018 1,525,540 17,805-5,880,738 4/1/2018 1,377,907 24,945-7,283,590 5/1/2018 1,481,513 28,903 (7,556,456) 1,237,550 6/1/2018 1,327,658 5,080-2,570,288 7/1/2018 1,349,844 10,903-3,931,035 8/1/2018 1,514,369 15,599-5,461,003 9/1/2018 2,537,818 24,659-8,023,480 10/1/2018 2,558,230 29,643-10,611,352 11/1/2018 2,487,558 43,560 (12,941,456) - 12/1/2018 1,569, ,569,081 1/1/2019 1,383,167 6,226-2,958,474 2/1/2019 1,514,015 11,740-4,484,229 3/1/2019 1,579,689 18,408-6,082,326 4/1/2019 1,426,816 24,968-7,534,110

129 Month Scheduled Monthly Deposit Minimum Debt Service Fund Interest Earnings Accrual (1) Amounts are to be deposited on the last Business Day of the prior month. II-4 Debt Service Cumulative Scheduled Balance 5/1/2019 1,535,200 30,928 (7,421,831) 1,678,406 6/1/2019 1,380,493 7,349-3,066,248 7/1/2019 1,404,208 11,748-4,482,204 8/1/2019 1,575,138 18,399-6,075,741 9/1/2019 2,639,062 26,604-8,741,406 10/1/2019 2,659,691 33,491-11,434,588 11/1/2019 2,585,872 46,939 (13,866,831) - 12/1/2019 1,632, ,632,195 1/1/2020 1,436,902 6,700-3,075,798 2/1/2020 1,570,545 13,047-4,659,390 3/1/2020 1,636,998 18,489-6,314,878 4/1/2020 1,531,386 25,058-7,871,322 5/1/2020 1,591,982 32,312 (7,252,650) 2,242,965 6/1/2020 1,436,110 9,207-3,688,283 7/1/2020 1,461,416 15,140-5,164,839 8/1/2020 1,641,315 22,615-6,828,769 9/1/2020 2,753,478 26,163-9,608,410 10/1/2020 2,778,523 39,443-12,426,376 11/1/2020 2,701,012 52,711 (14,977,650) - 12/1/2020 1,700, ,700,303 1/1/2021 1,504,853 7,678-3,212,834 2/1/2021 1,630,748 11,870-4,855,452 3/1/2021 1,704,317 19,932-6,579,700 4/1/2021 1,539,383 27,010-8,146,093 5/1/2021 1,654,550 35,669 (7,049,869) 2,786,443 6/1/2021 1,486,996 10,676-4,284,115 7/1/2021 1,513,787 17,586-5,815,488 8/1/2021 1,699,897 24,668-7,540,053 9/1/2021 2,851,078 29,920-10,421,052 10/1/2021 2,876,359 42,778-13,340,190 11/1/2021 2,795,806 54,761 (15,989,869) - 12/1/2021 1,748, ,748,502 1/1/2022 $1,547,628 $7,656 - $3,303,786 2/1/2022 1,681,711 12,658-4,998,155 3/1/2022 1,755,523 20,517-6,774,195 4/1/2022 1,579,751 27,808-8,381,754 5/1/2022 1,699,078 35,554 ($6,815,194) 3,301,193 6/1/2022 1,487,431 13,100-4,801,723 7/1/2022 1,514,162 19,711-6,335,596 8/1/2022 1,700,444 26,008-8,062,048 9/1/2022 2,852,063 33,095-10,947,205 10/1/2022 2,877,427 47,934-13,872,567 11/1/2022 2,796,881 53,150 (16,520,194) - 12/1/2022 1,762, ,762,828 1/1/2023 1,560,397 7,719-3,330,944 2/1/2023 1,695,812 12,762-5,039,518 3/1/2023 1,770,435 20,687-6,830,640 4/1/2023 1,593,156 29,909-8,453,705

130 Month Scheduled Monthly Deposit Minimum Debt Service Fund Interest Earnings Accrual (1) Amounts are to be deposited on the last Business Day of the prior month. II-5 Debt Service Cumulative Scheduled Balance 5/1/2023 1,713,371 32,389 (6,560,438) 3,639,027 6/1/2023 1,566,583 14,938-5,220,549 7/1/2023 1,630,355 22,859-6,873,763 8/1/2023 1,827,294 26,336-8,727,393 9/1/2023 3,058,888 35,826-11,822,107 10/1/2023 3,080,260 50,147-14,952,515 11/1/2023 3,001,579 59,334 (17,810,438) - 12/1/2023 1,875, ,875,432 1/1/2024 1,631,822 7,955-3,515,210 2/1/2024 1,752,721 13,949-5,281,880 3/1/2024 1,808,141 21,682-7,111,703 4/1/2024 1,691,487 29,194-8,832,383 5/1/2024 1,763,805 36,257 (6,265,125) 4,367,320 6/1/2024 1,638,590 19,123-6,025,034 7/1/2024 1,693,210 23,084-7,741,327 8/1/2024 1,897,571 31,778-9,670,677 9/1/2024 3,175,845 42,345-12,888,867 10/1/2024 3,197,430 49,382-16,135,679 11/1/2024 3,115,177 66,237 (19,115,125) - 12/1/2024 1,954, ,954,534 1/1/2025 1,709,594 8,023-3,672,152 2/1/2025 1,845,081 15,577-5,532,809 3/1/2025 1,901,152 22,712-7,456,673 4/1/2025 1,717,169 28,569-9,202,411 5/1/2025 1,856,295 37,776 (5,927,813) 5,168,670 6/1/2025 1,731,079 21,925-6,921,673 7/1/2025 1,784,059 27,466-8,733,199 8/1/2025 1,998,532 35,850-10,767,580 9/1/2025 3,344,045 45,674-14,157,300 10/1/2025 3,365,883 56,179-17,579,362 11/1/2025 3,278,440 76,974 (20,732,813) - 12/1/2025 2,033, ,033,653 1/1/2026 1,753,974 8,626-3,796,253 2/1/2026 1,868,542 15,584-5,680,378 3/1/2026 $1,913,423 $23,318 - $7,617,120 4/1/2026 1,728,253 30,226-9,375,599 5/1/2026 1,890,982 38,487 ($5,539,181) 5,765,887 6/1/2026 1,720,558 23,669-7,510,114 7/1/2026 1,766,099 30,829-9,307,042 8/1/2026 1,978,642 40,752-11,326,436 9/1/2026 3,310,984 43,395-14,680,815 10/1/2026 3,332,834 60,265-18,073,913 11/1/2026 3,246,469 76,667 (21,194,181) - 12/1/2026 2,021, ,021,347 1/1/2027 1,720,190 9,127-3,750,665 2/1/2027 1,809,286 13,857-5,573,807 3/1/2027 1,927,236 22,880-7,523,923 4/1/2027 1,723,314 30,886-9,278,123

131 Month Scheduled Monthly Deposit Minimum Debt Service Fund Interest Earnings Accrual (1) Amounts are to be deposited on the last Business Day of the prior month. II-6 Debt Service Cumulative Scheduled Balance 5/1/2027 1,873,931 40,626 (5,128,238) 6,064,443 6/1/2027 1,884,872 23,235-7,972,550 7/1/2027 1,948,895 32,727-9,954,172 8/1/2027 2,170,186 42,224-12,166,582 9/1/2027 3,609,695 48,279-15,824,556 10/1/2027 3,611,904 64,960-19,501,420 11/1/2027 3,497,528 80,053 (22,878,238) - 12/1/2027 2,175, ,175,853 1/1/2028 1,846,207 9,527-4,031,587 2/1/2028 1,939,820 15,446-5,986,853 3/1/2028 1,992,281 24,576-8,003,710 4/1/2028 1,845,531 35,046-9,884,286 5/1/2028 1,938,445 37,870 (4,662,300) 7,198,301 6/1/2028 1,950,390 29,549-9,178,240 7/1/2028 2,016,609 40,188-11,235,037 8/1/2028 2,245,419 43,045-13,523,501 9/1/2028 3,734,889 55,514-17,313,903 10/1/2028 3,737,119 73,443-21,124,465 11/1/2028 3,618,725 83,825 (24,627,300) - 12/1/2028 2,242, ,242,190 1/1/2029 1,901,803 9,511-4,153,504 2/1/2029 1,997,460 16,482-6,167,446 3/1/2029 2,050,234 25,317-8,242,998 4/1/2029 1,834,131 34,965-10,112,094 5/1/2029 1,996,077 40,126 (4,163,175) 7,985,123 6/1/2029 2,008,873 32,779-10,026,775 7/1/2029 2,077,048 42,532-12,146,356 8/1/2029 2,312,968 48,199-14,507,522 9/1/2029 3,847,227 65,509-18,420,258 10/1/2029 3,849,470 68,054-22,337,782 11/1/2029 3,727,466 91,697 (25,958,175) - 12/1/2029 2,309, ,309,961 1/1/2030 1,958,713 9,166-4,277,840 2/1/2030 2,056,471 16,975-6,351,286 3/1/2030 2,109,578 26,072-8,486,936 4/1/2030 1,887,621 34,839-10,409,396 5/1/2030 $2,055,079 $42,731 ($3,618,300) $8,888,906 6/1/2030 2,068,959 38,922-10,996,787 7/1/2030 2,139,145 42,132-13,178,064 8/1/2030 2,381,954 54,096-15,614,115 9/1/2030 3,961,731 68,369-19,644,215 10/1/2030 3,963,989 75,264-23,683,468 11/1/2030 3,838,567 97,221 (27,418,300) - 12/1/2030 2,377, ,377,855 1/1/2031 2,015,651 9,761-4,403,267 2/1/2031 2,115,502 18,678-6,537,447 3/1/2031 2,168,929 26,836-8,733,212 4/1/2031 1,941,121 33,460-10,707,793

132 Month Scheduled Monthly Deposit Minimum Debt Service Fund Interest Earnings Accrual (1) Amounts are to be deposited on the last Business Day of the prior month. II-7 Debt Service Cumulative Scheduled Balance 5/1/2031 2,114,102 43,955 (3,023,300) 9,842,551 6/1/2031 2,128,839 41,750-12,013,141 7/1/2031 2,201,029 47,670-14,261,839 8/1/2031 2,450,818 58,545-16,771,202 9/1/2031 4,076,530 71,141-20,918,872 10/1/2031 4,078,801 83,010-25,080,683 11/1/2031 3,949, ,820 (28,933,300) - 12/1/2031 2,447, ,447,231 1/1/2032 2,073,677 10,381-4,531,288 2/1/2032 2,175,666 18,601-6,725,555 3/1/2032 2,229,427 26,688-8,981,670 4/1/2032 2,066,925 36,870-11,085,465 5/1/2032 2,174,258 48,540 (2,375,550) 10,932,712 6/1/2032 2,190,108 41,887-13,164,707 7/1/2032 2,264,347 54,041-15,483,095 8/1/2032 2,521,154 65,677-18,069,926 9/1/2032 4,193,557 71,704-22,335,187 10/1/2032 4,195,843 91,686-26,622,716 11/1/2032 4,062, ,286 (30,595,550) - 12/1/2032 2,513, ,513,580 1/1/2033 2,129,468 11,006-4,654,054 2/1/2033 2,233,478 17,831-6,905,364 3/1/2033 2,287,501 28,347-9,221,211 4/1/2033 2,048,018 37,853-11,307,083 5/1/2033 2,232,062 47,963 (1,670,050) 11,917,058 6/1/2033 2,248,607 47,289-14,212,954 7/1/2033 2,324,802 58,344-16,596,101 8/1/2033 2,588,802 68,127-19,253,030 9/1/2033 4,305,623 79,034-23,637,687 10/1/2033 4,307, ,502-28,049,109 11/1/2033 4,171, ,465 (32,130,050) - 12/1/2033 1,484, ,484,495 1/1/2034 1,257,344 6,500-2,748,339 2/1/2034 1,318,347 10,530-4,077,216 3/1/2034 1,349,576 16,737-5,443,529 4/1/2034 1,208,502 23,835-6,675,867 5/1/2034 1,317,529 25,577 (908,550) 7,110,423 6/1/2034 1,327,537 29,188-8,467,148 7/1/2034 $1,372,506 $37,075 - $9,876,729 8/1/2034 1,528,408 37,841-11,442,978 9/1/2034 2,541,939 46,973-14,031,890 10/1/2034 2,543,267 59,521-16,634,678 11/1/2034 2,462,511 66,009 ($18,963,550) - 12/1/ , ,351 1/1/ ,237 2,962-1,292,551 2/1/ ,738 5,129-1,917,418 3/1/ ,121 7,871-2,559,410 4/1/ ,932 10,857-3,138,199

133 Month Scheduled Monthly Deposit Minimum Debt Service Fund Interest Earnings Accrual Debt Service Cumulative Scheduled Balance 5/1/ ,361 12,453 (452,887) 3,317,126 6/1/ ,382 13,617-3,955,126 7/1/ ,526 16,777-4,617,428 8/1/ ,790 18,323-5,354,542 9/1/2035 1,195,431 24,178-6,574,151 10/1/2035 1,196,042 24,288-7,794,481 11/1/2035 1,158,052 31,996 (18,397,887) - 12/1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ /1/ (1) Amounts are to be deposited on the last Business Day of the prior month. II-8

134 Schedule III AMORTIZED VALUES OF THE SERIES 2007A BONDS The following table sets forth the Amortized Value of the Series 2007A Bonds of each maturity as of the specified redemption date. Extraordinary Mandatory Redemption Date Extraordinary Mandatory Redemption Date III-1 Extraordinary Mandatory Redemption Date Amortized Value Amortized Value Amortized Value 10/11/2007 $308,376,577 4/1/2011 $295,287,591 9/1/2014 $279,815,366 12/1/ ,302,996 5/1/ ,263,016 10/1/ ,792,409 1/1/ ,253,844 6/1/ ,214,661 11/1/ ,775,196 2/1/ ,208,436 7/1/ ,171,080 12/1/ ,862,005 3/1/ ,168,956 8/1/ ,132,205 1/1/ ,828,314 4/1/ ,133,749 9/1/ ,097,077 2/1/ ,799,874 5/1/ ,101,989 10/1/ ,068,383 3/1/ ,774,421 6/1/ ,046,892 11/1/ ,043,035 4/1/ ,754,427 7/1/ ,996,465 12/1/ ,704,214 5/1/ ,737,781 8/1/ ,951,548 1/1/ ,665,086 6/1/ ,699,716 9/1/ ,909,962 2/1/ ,630,275 7/1/ ,665,406 10/1/ ,873,617 3/1/ ,599,180 8/1/ ,635,350 11/1/ ,842,219 4/1/ ,574,110 9/1/ ,610,090 12/1/ ,786,199 5/1/ ,552,707 10/1/ ,589,490 1/1/ ,734,799 6/1/ ,507,711 11/1/ ,572,274 2/1/ ,687,717 7/1/ ,467,502 12/1/ ,461,332 3/1/ ,645,298 8/1/ ,432,056 1/1/ ,428,741 4/1/ ,608,985 9/1/ ,401,554 2/1/ ,400,262 5/1/ ,575,273 10/1/ ,374,676 3/1/ ,376,871 6/1/ ,518,038 11/1/ ,352,579 4/1/ ,357,730 7/1/ ,466,074 12/1/ ,506,128 5/1/ ,341,922 8/1/ ,419,069 1/1/ ,469,529 6/1/ ,305,106 9/1/ ,375,941 2/1/ ,437,336 7/1/ ,271,611 10/1/ ,337,189 3/1/ ,410,063 8/1/ ,244,174 11/1/ ,304,084 4/1/ ,385,997 9/1/ ,219,712 12/1/ ,627,162 5/1/ ,366,787 10/1/ ,198,979 1/1/ ,580,582 6/1/ ,325,665 11/1/ ,183,720 2/1/ ,538,410 7/1/ ,288,117 12/1/ ,873,842 3/1/ ,500,332 8/1/ ,255,141 1/1/ ,842,188 4/1/ ,467,020 9/1/ ,227,312 2/1/ ,814,847 5/1/ ,438,650 10/1/ ,202,758 3/1/ ,792,044 6/1/ ,385,883 11/1/ ,183,128 4/1/ ,773,476 7/1/ ,338,198 12/1/ ,079,365 5/1/ ,759,538 8/1/ ,295,196 1/1/ ,044,475 6/1/ ,722,893 9/1/ ,256,116 2/1/ ,014,047 7/1/ ,691,461 10/1/ ,222,979 3/1/ ,988,125 8/1/ ,663,321 11/1/ ,192,695 4/1/ ,966,111 9/1/ ,640,080 12/1/ ,431,683 5/1/ ,948,378 10/1/ ,621,172 1/1/ ,388,904 6/1/ ,908,844 11/1/ ,606,630 2/1/ ,349,962 7/1/ ,873,118 12/1/ ,967,618 3/1/ ,316,840 8/1/ ,842,067 1/1/ ,936,804 2/1/2018 $261,911,580 2/1/2022 $232,382,450 2/1/2026 $183,235,007

135 Extraordinary Mandatory Redemption Date Amortized Value Extraordinary Mandatory Redemption Date Amortized Value Extraordinary Mandatory Redemption Date Amortized Value 3/1/ ,889,388 3/1/ ,368,488 3/1/ ,232,410 4/1/ ,871,639 4/1/ ,357,452 4/1/ ,233,146 5/1/ ,857,309 5/1/ ,350,226 5/1/ ,237,093 6/1/ ,822,357 6/1/ ,324,421 6/1/ ,225,533 7/1/ ,791,758 7/1/ ,301,969 7/1/ ,217,559 8/1/ ,764,605 8/1/ ,283,553 8/1/ ,211,751 9/1/ ,742,040 9/1/ ,267,841 9/1/ ,210,456 10/1/ ,723,924 10/1/ ,257,470 10/1/ ,211,110 11/1/ ,710,191 11/1/ ,250,424 11/1/ ,215,682 12/1/ ,291,667 12/1/ ,523,455 12/1/ ,554,112 1/1/ ,262,880 1/1/ ,504,191 1/1/ ,550,718 2/1/ ,237,100 2/1/ ,488,948 2/1/ ,548,763 3/1/ ,216,804 3/1/ ,477,450 3/1/ ,550,890 4/1/ ,199,731 4/1/ ,468,571 4/1/ ,554,675 5/1/ ,185,583 5/1/ ,463,482 5/1/ ,561,419 6/1/ ,151,691 6/1/ ,440,802 6/1/ ,554,356 7/1/ ,122,191 7/1/ ,421,014 7/1/ ,550,211 8/1/ ,096,479 8/1/ ,405,077 8/1/ ,549,203 9/1/ ,074,668 9/1/ ,393,233 9/1/ ,550,207 10/1/ ,056,998 10/1/ ,385,117 10/1/ ,554,564 11/1/ ,043,651 11/1/ ,380,144 11/1/ ,562,018 12/1/ ,567,611 12/1/ ,111,876 12/1/ ,811,146 1/1/ ,540,919 1/1/ ,095,670 1/1/ ,811,794 2/1/ ,516,930 2/1/ ,083,228 2/1/ ,815,046 3/1/ ,498,506 3/1/ ,074,365 3/1/ ,819,817 4/1/ ,483,083 4/1/ ,069,110 4/1/ ,826,974 5/1/ ,471,958 5/1/ ,066,319 5/1/ ,837,819 6/1/ ,440,013 6/1/ ,047,015 6/1/ ,836,082 7/1/ ,412,280 7/1/ ,031,330 7/1/ ,836,730 8/1/ ,387,802 8/1/ ,018,514 8/1/ ,839,981 9/1/ ,368,902 9/1/ ,009,504 9/1/ ,845,619 10/1/ ,352,921 10/1/ ,004,201 10/1/ ,852,994 11/1/ ,341,633 11/1/ ,001,590 11/1/ ,862,755 12/1/ ,588,168 12/1/ ,136,735 12/1/ ,896,883 1/1/ ,563,529 1/1/ ,124,335 1/1/ ,897,749 2/1/ ,543,000 2/1/ ,116,261 2/1/ ,900,783 3/1/ ,525,621 3/1/ ,110,327 3/1/ ,906,638 4/1/ ,513,232 4/1/ ,108,148 4/1/ ,914,013 5/1/ ,503,985 5/1/ ,107,931 5/1/ ,924,858 6/1/ ,474,421 6/1/ ,092,159 6/1/ ,922,031 7/1/ ,449,201 7/1/ ,080,064 7/1/ ,923,327 8/1/ ,428,046 8/1/ ,070,454 8/1/ ,926,360 9/1/ ,410,122 9/1/ ,064,333 9/1/ ,932,216 10/1/ ,397,489 10/1/ ,062,303 10/1/ ,940,027 11/1/ ,388,066 11/1/ ,063,584 11/1/ ,951,962 12/1/ ,422,507 12/1/ ,247,985 12/1/ ,155,878 1/1/ ,400,515 1/1/ ,239,240 1/1/ ,158,045 III-2

136 Extraordinary Mandatory Redemption Date Amortized Value 2/1/2030 $108,161,297 3/1/ ,166,717 4/1/ ,174,304 5/1/ ,182,975 6/1/ ,182,975 7/1/ ,185,143 8/1/ ,188,395 9/1/ ,193,814 10/1/ ,201,401 11/1/ ,249,581 12/1/ ,449,581 1/1/ ,451,272 2/1/ ,453,810 3/1/ ,458,886 4/1/ ,464,807 5/1/ ,471,574 6/1/ ,471,574 7/1/ ,473,266 8/1/ ,476,649 9/1/ ,480,879 10/1/ ,486,800 11/1/ ,523,692 12/1/ ,613,692 1/1/ ,614,865 2/1/ ,616,626 3/1/ ,620,146 4/1/ ,624,254 5/1/ ,629,535 6/1/ ,629,535 7/1/ ,630,709 8/1/ ,633,056 9/1/ ,635,990 10/1/ ,640,684 11/1/ ,662,333 12/1/ ,442,333 1/1/ ,442,942 2/1/ ,444,161 3/1/ ,445,988 4/1/ ,448,121 5/1/ ,450,862 6/1/ ,449,644 7/1/ ,449,644 8/1/ ,450,557 9/1/ ,452,690 10/1/ ,455,736 11/1/ ,460,000 III-3

137 Schedule IV PRINCIPAL AMOUNT BY PROJECT PARTICIPANT PRINCIPAL AMOUNT: ANAHEIM Bond Year (November 1) Fixed Rate Bonds Index Rate Bonds 2009 $925, , , , , , , , , , ,055, ,265, ,465, ,580, ,845, ,105, ,430, ,565, ,910, ,275, ,575, ,905, ,250, ,630, ,995, $2,960, ,945,000 IV-1

138 PRINCIPAL AMOUNT: BURBANK Bond Year (November 1) Fixed Rate Bonds Index Rate Bonds 2009 $1,860, ,895, ,750, ,585, ,345, ,280, ,350, ,415, ,525, ,780, ,130, ,555, ,960, ,225, ,725, ,260, ,895, ,180, ,875, ,610, ,215, ,875, ,575, ,340, ,085, $5,975, ,935,000 IV-2

139 PRINCIPAL AMOUNT: COLTON Bond Year (November 1) Fixed Rate Bonds Index Rate Bonds 2009 $635, , , , , , , , , , , , ,010, ,095, ,270, ,450, ,675, ,770, ,005, ,255, ,465, ,690, ,930, ,190, ,440, $2,040, ,030,000 IV-3

140 PRINCIPAL AMOUNT: GLENDALE Bond Year (November 1) Fixed Rate Bonds Index Rate Bonds 2009 $1,275, ,295, ,200, ,090, , , , , ,045, ,220, ,465, ,755, ,030, ,205, ,555, ,915, ,360, ,555, ,030, ,530, ,945, ,405, ,880, ,405, ,915, $4,100, ,075,000 IV-4

141 PRINCIPAL AMOUNT: PASADENA Bond Year (November 1) Fixed Rate Bonds Index Rate Bonds 2009 $930, , , , , , , , , , ,065, ,275, ,475, ,600, ,855, ,120, ,445, ,585, ,930, ,295, ,595, ,925, ,275, ,655, ,025, $2,980, ,960,000 IV-5

142 Schedule V GAS ENTITLEMENT SHARES Gas Entitlement Share City of Anaheim, California 16.5% City of Burbank, California 33.0% City of Colton, California 11.0% City of Glendale, California 23.0% City of Pasadena, California 16.5% V-1

143 Schedule VI WORKING CAPITAL ACCOUNT SUBACCOUNTS Amount* Anaheim Working Capital Account Subaccount: $01,576,532 Burbank Working Capital Account Subaccount: $03,181,903 Colton Working Capital Account Subaccount: $01,086,269 Glendale Working Capital Account Subaccount: $02,182,151 Pasadena Working Capital Account Subaccount: $01,586,145 *To November 1, 2035, and $0 on and after such date. VI-1

144 Summary Report: Litéra Change-Pro TDC Document Comparison done on 7/30/2013 8:10:36 PM Style Name: Default Style Original DMS:iw://AODMS/SUTHERLAND/ /1 Modified DMS: iw://aodms/sutherland/ /17 Changes: Add 254 Delete 168 Move From 28 Move To 28 Table Insert 39 Table Delete 0 Embedded Graphics (Visio, ChemDraw, Images etc.) 0 Embedded Excel 0 Format Changes 0 Total Changes: 517

145 Annex II FORM OF AMENDED PREPAID NATURAL GAS SALES AGREEMENT II-1

146 EXECUTION VERSIONSUTHERLAND DRAFT 30 JULY 2013 COMPOSITE COPY INCORPORATING OCT. 22, 2009 AMENDMENT AMENDED AND RESTATED PREPAID NATURAL GAS SALES AGREEMENT between J. ARON & COMPANY and SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY Dated as of October 3, 2007 Dated as of [ ], 2013 Nominating Agent: [INSERT UNIQUE COVER PAGE]

147 TABLE OF CONTENTS Page ARTICLE I DEFINITIONS...1 Section 1.1 Defined Terms...1 Section 1.2 Definitions; Interpretation...10 ARTICLE II EXECUTION DATE AND DELIVERY PERIOD...10 Section 2.1 Execution Date; Delivery Period...10 Section 2.2 Termination by Seller Prior to Delivery Period...10 ARTICLE III SALE AND PURCHASE...11 Section 3.1 Sale and Purchase of Gas...11 Section 3.2 Price...11 Section 3.3 Prepayment...11 ARTICLE IV FAILURE TO DELIVER OR TAKE GAS...11 Section 4.1 Seller s Failure to Deliver (Not Due to Force Majeure)...11 Section 4.2 Buyer s Failure to Take (Not Due to Force Majeure)...13 Section 4.3 Failure to Deliver or Take Due to Force Majeure Section 4.4 Make-Up Delivery in Lieu of Payment...14 Section 4.5 Sole Remedies...14 ARTICLE V TRANSPORTATION AND DELIVERY; COMMUNICATIONS...14 Section 5.1 Delivery Points...14 Section 5.2 Responsibility for Transportation; Permits Section 5.3 Title and Risk of Loss...15 Section 5.4 Daily Flow Rates...16 Section 5.5 Imbalances...16 Section 5.6 Nominating Agent...16 Section 5.7 Gas Scheduling Agreement...17 ARTICLE VI QUALITY AND MEASUREMENT...17 ARTICLE VII GAS REMARKETING...18 Section 7.1 Monthly Remarketing Notice...18 Section 7.2 Daily Remarketing Notice...18 Section 7.3 Remarketing to Municipal Utilities Section 7.4 Remarketing Terms...23 Section 7.5 Remarketing on Buyer s Behalf...25 ARTICLE VIII REPRESENTATIONS AND WARRANTIES...25 Section 8.1 Representations and Warranties...25 Section 8.2 Additional Representations and Warranties of Buyer Section 8.3 Expiration of Representations and Warranties i -

148 Section 8.4 ARTICLE IX ARTICLE X Warranty of Title...27 TAXES...27 JURISDICTION ARTICLE XI FORCE MAJEURE...28 Section 11.1 Applicability of Force Majeure...28 Section 11.2 Force Majeure Defined Section 11.3 Force Majeure Exclusions Section 11.4 Settlement of Labor Disputes...29 Section 11.5 Force Majeure Procedure...29 ARTICLE XII COMPLIANCE WITH LAWS...29 ARTICLE XIII ASSIGNMENT ARTICLE XIV PAYMENTS...30 Section 14.1 Monthly Statements Section 14.2 Payment Section 14.3 Payment of Disputed Amounts...31 Section 14.4 Late Payment...31 Section 14.5 Audit; Adjustments Section 14.6 Netting...32 ARTICLE XV [RESERVED]...32 ARTICLE XVI NOTICES...32 ARTICLE XVII DEFAULT; REMEDIES; TERMINATION...32 Section 17.1 Seller Default...32 Section 17.2 Buyer Default...33 Section 17.3 Non-Default Termination Events...34 Section 17.4 Remedies and Termination Section 17.5 Replacement of Swaps...38 Section 17.6 Seller s Right to Issue a Remarketing Notice Section 17.7 Limitation on Damages ARTICLE XVIII MISCELLANEOUS Section 18.1 Deliveries Section 18.2 Entirety; Amendments Section 18.3 Governing Law Section 18.4 Non-Waiver Section 18.5 Severability Section 18.6 Exhibits Section 18.7 Winding Up Arrangements Section 18.8 Relationships of Parties Section 18.9 Immunity ii -

149 Section Limited Liability Section Rates and Indices Section Counterparts Section Rights of Indenture Trustee Section Representation by Counsel; Drafting EXHIBIT A-1 PRIMARY DELIVERY POINTS EXHIBIT A-2 DAILY CONTRACT QUANTITIES EXHIBIT A-3 REVISED DELIVERY POINTS EXHIBIT B NOTICES EXHIBIT C ADDITIONAL TERMINATION PAYMENT EXHIBIT D ALTERNATIVE CREDIT SUPPORT[RESERVED] EXHIBIT E NOMINATING AGENT AND GAS SUPPLY CONTRACT EXHIBIT F FORM OF REMARKETING NOTICE - iii -

150 PREPAID NATURAL GAS SALES AGREEMENT This Amended and Restated Prepaid Natural Gas Sales Agreement (hereinafterthis Agreement ) is made and entered into as of October 3[ ], (the Execution Date ), by and between J. Aron & Company, a New York general partnership ( Seller ), and Southern California Public Power Authority, a joint powers agency and a public entity organized under the laws of the State of California ( Buyer ). WITNESSETH: WHEREAS, Seller desires and Buyer have heretofore entered into a Prepaid Natural Gas Sales Agreement, dated as of October 3, 2007 and amended on October 22, 2009 (the Original Agreement ), by which Seller has agreed to sell natural gas to Buyer, and Buyer desireshas agreed to purchase natural gas from Seller, upon the terms and conditions hereinaftertherein set forth; and WHEREAS, Seller and Buyer desire to amend and restate the Original Agreement as herein provided; NOW, THEREFORE, in consideration of the premises above and the mutual covenants and agreements herein set forth, Buyer and Seller (the Parties hereto; each is a Party ) hereby amend and restate the Original Agreement to read, and hereby agree, as follows: ARTICLE I DEFINITIONS Section 1.1 Defined Terms. The following terms, when used in this Agreement and identified by the capitalization of the first letter thereof, have the respective meanings set forth below, unless the context otherwise requires: Additional Termination Payment has the meaning specified in Exhibit C. Administrative Fee has the meaning specified for such term in the Pricing Agreement. ADP Quantity has the meaning specified in paragraph 3(a) of Exhibit A-3. Affiliate means, with respect to either Party, any entity which is a direct or indirect parent or subsidiary of such Party or which directly or indirectly (i) owns or controls such Party, (ii) is owned or controlled by such Party, or (iii) is under common ownership or control with such Party. For purposes of this definition, control of an entity means the power, directly or indirectly, either to (a) vote 50% of more of the securities having ordinary voting power for the election of directors or Persons performing similar functions or (b) direct or cause the direction of the management and policies, whether by contract or otherwise. Aggregate DCQ means, with respect to each Gas Day during the Delivery Period and each Delivery Point, the sum of (i) the Daily Contract Quantity for such Delivery Point for such Gas Day, and (ii) with respect to all Related Prepaid Contracts, the aggregate sum of the Daily

151 Contract Quantities (as defined in each Related Prepaid Contract) for such Delivery Point for such Gas Day. Aggregate Shortfall Quantity means, with respect to any Delivery Point and Gas Day, the sum of (i) a Shortfall Quantity under this Agreement at such Delivery Point and Gas Day, and (ii) with respect to all Related Prepaid Contracts, the aggregate sum of the Shortfall Quantities (as defined in each Related Prepaid Contract) for such Delivery Point and Gas Day. Agreement has the meaning specified in the preamble and shall include exhibits, recitals and attachments referenced herein and attached hereto and all amendments, supplements and modifications hereto and thereto. Alternate Delivery Point has the meaning specified in Section 5.1. Alternative Credit Support has the meaning specified in Exhibit D. ATP Discount means the amount specified as the ATP Discount in the Pricing Agreement. Billing Date has the meaning specified in Section 14.1(b). Billing Statement has the meaning specified in Section 14.1(b). Bond Indenture means the Amended and Restated Trust Indenture to be entered into prior to the commencement of the Delivery Period, dated as of the date hereof, between Buyer and the Indenture Trustee. Bonds means the bonds issued pursuant to the Bond Indenture. (IT). Btu means, subject to Article VI, the International Btu, which is also called the Btu Business Day means any day other than (i) a Saturday or Sunday, (ii) a Federal Reserve Bank Holiday, (iii) any other day on which commercial banks generally in either New York, New York or the State of California are authorized or required by Law to close, or (iv) any day on which the New York Stock Exchange is closed. Buyer has the meaning specified in the preamble. Buyer Default has the meaning specified in Section Buyer Non-Default Termination Event has the meaning specified in Section 17.3(b). Buyer s Statement has the meaning specified in Section 14.1(a). Buyer Swap means (i) the transaction confirmation specifying this Agreement as the Specified Prepaid Contract therein, which transaction confirmation was entered into under the ISDA Master Agreement dated as of the Execution Date[ ], 2013 by Buyer and the Swap Counterparty, pursuant to which transaction confirmation Buyer is the floating price payer 2

152 and the Swap Counterparty is the fixed price payer with respect to an aggregate notional quantity of Gas in each Month that is equal to the quantity of Gas to be delivered hereunder in such Month and for a term that is equivalent to the Delivery Period of this Agreement, and (ii) each replacement Buyer Swap entered into pursuant to Section Changed Circumstance has the meaning specified in paragraph 2(c) of Exhibit A-3. Claims means all claims or actions, threatened or filed, that directly or indirectly relate to the indemnities provided herein, and the resulting losses, damages, expenses, excluding attorneys fees, experts fees, and court costs, whether incurred by settlement or otherwise, and whether such claims or actions are threatened or filed prior to or after the termination of this Agreement. Code means the Internal Revenue Code of 1986, as amended, and the U.S. Treasury Regulations thereunder. Collateral Agency Agreement means that certain Collateral Agency Agreement of even date herewith, dated as of October 3, 2007, between Buyer and the Indenture Trustee. Commercially Reasonable or Commercially Reasonable Efforts means, with respect to any purchase or sale or other action required to be made, attempted or taken by a Person, such efforts as a reasonably prudent business would undertake for the protection of its own interest under the conditions affecting such purchase or sale or other action, including without limitation, the amount of notice of the need to take such action, the duration and type of the purchase or sale or other action, the competitive environment in which such purchase or sale or other action occurs and the risk to such Person required to take such action. Credit Rating means with respect to any Person, on any date of determination, the respective ratings then assigned to such Person s unsecured, senior long-term debt or deposit obligations (not supported by third party credit enhancement) by S&P, Moody s or other specified rating agency or agencies or if such entity does not have a rating for its unsecured, senior long-term debt or deposit obligations, then the rating assigned to such entity as its corporate credit rating by S&P. Critical Notice has the meaning specified in Section 5.2(b). Daily Commodity Reference Price means either (A) the Daily Index Price, or (B) the Index Price (Low), as applicable. Daily Contract Quantity means, with respect to each Gas Day during the Delivery Period and each Delivery Point, the quantity of Gas (in MMBtu) shown on Exhibit A-2 under the name of the Nominating Agent for such Delivery Point opposite the Month in which such Gas Day occurs divided by the corresponding number of days in such Month. Daily Index Price means, with respect to any Delivery Point and any Gas Day, (i) with respect to each Primary Delivery Point (as shown on Exhibit A-1), the daily index price specified on Exhibit A-1 for such Primary Delivery Point, (ii) with respect to each Alternate Delivery Point to which the Parties mutually agree pursuant to Section 5.1, the daily index price that is mutually 3

153 agreed and identified by the Parties in connection therewith, or if no such index price is identified, the daily index price specified on Exhibit A-1 for the Primary Delivery Point from which quantities are being shifted to such Alternate Delivery Point, or (iii) with respect to each Alternate Delivery Point specified pursuant to Exhibit A-3, the daily index price identified in accordance with Exhibit A-3. Daily Remarketing Notice has the meaning specified in Section 7.2. Default Rate means, as of any date of determination, the lesser of (a) the sum of (i) the rate of interest per annum quoted in The Wall Street Journal (Eastern Edition) under the Money Rates section as the Prime Rate for such date of determination, plus (ii) one percent per annum, or (b) if a maximum rate is imposed by applicable Law, such maximum lawful rate. Delivering Transporter means the Transporter delivering Gas at a Delivery Point. Delivery Period has the meaning specified in Section 2.1. Delivery Point means each Primary Delivery Point and each properly nominated or mutually agreed Alternate Delivery Point. Direct Sale Proceeds has the meaning specified in Section 7.3(c)(i). Discount Rate Spread means the amount specified as the Discount Rate Spread for this Agreement in the Pricing Agreement. Early Termination Date means a date designated pursuant to 17.4(a), 17.4(b), 17.4(c), 17.4(d) or 17.4(ej) or any judicial proceeding upon which the Delivery Period will end and Buyer s and Seller s respective obligations to receive and deliver Gas under this Agreement will terminate. Early Termination Payment Date has the meaning specified in Section 17.4(fg). Execution Date has the meaning specified in the preamble. Expired Fully Disqualified Sales Ledger has the meaning specified in Section 7.3(c)(vi). Expired Non-Service Area Sales Ledger has the meaning specified in Section 7.3(c)(vi). Firm means, with respect to service on any pipeline system or at any storage facility, the pipeline or storage provider providing such service may interrupt its performance without liability only to the extent that such performance is prevented for reasons of Force Majeure with respect to such party asserting Force Majeure. Fixed Price means the amount specified as the Fixed Price for this Agreement in the Pricing Agreement. 4

154 Force Majeure has the meaning specified in Section Fully Disqualified Remarketing Limit means 1,801,193 MMBtus of Gas, as such Fully Disqualified Remarketing Limit may be increased from time to time upon receipt by Buyer and Seller of a Tax Opinion setting forth a higher Fully Disqualified Remarketing Limit. The Fully Disqualified Remarketing Limit has been calculated as the sum of the values determined under the following formula: X = ($15,000,000/Y)/Z Where: X = A value determined for each Month of the Delivery Period Y = The number of Months in the Delivery Period Z = The Fixed Price for the Month in the Delivery Period in which a value is being determined. Fully Disqualified Remarketing Proceeds has the meaning specified in Section 7.3(c)(i). Fully Disqualified Sale means the sale of Gas to (i) a Person other than a Municipal Utility or a State or political subdivision, or (ii) a Municipal Utility or a State or political subdivision that, in each case, makes Private Business Use of such Gas. Fully Disqualified Sales Ledger has the meaning specified in Section 7.3(c)(i). Gas shall mean any mixture of hydrocarbons and noncombustible gases in a gaseous state consisting primarily of methane. Gas Day means a period of twenty-four (24) consecutive hours, beginning and ending at 7:00 a.m. PPT. Gas Scheduling Agreement means the Gas Scheduling Agreement of even date herewith, dated as of October 3, 2007, between Buyer and Seller. Gas Supply Contract means the Gas Supply Contract of even date herewith, dated as of October 3, 2007, between Buyer and the Project Participant named as the Nominating Agent of this Agreement. Government Agency means the United States of America, any state thereof, or any local jurisdiction, or any political subdivision of any of the foregoing including, but not limited to courts, administrative bodies, departments, commissions, boards, bureaus, agencies, municipalities or other instrumentalities. Governmental Approval means any authorization, consent, approval, license, ruling, permit, exemption, variance, order, judgment, decree, declarations of or regulation by any 5

155 Government Agency relating to the execution, delivery or performance of this Agreement as any of the foregoing are in effect as of the Execution Date. Imbalance Charges means any fees, penalties, costs or charges (in cash or in kind) assessed by a Transporter for failure to satisfy the Transporter s balancing and/or nomination requirements based on such Transporter s applicable pipeline tariff. Increased Costs has the meaning specified in paragraph 4(a) of Exhibit A-3. Indemnifying Party has the meaning specified in Section 5.3(b). Indenture Trustee means U.S. Bank National Association, a national banking association organized under the laws of the United States of America, and its successors as trustee under the Bond Indenture. Index Price (Low) means, with respect to any Delivery Point and any Gas Day, (i) with respect to each Primary Delivery Point (as shown on Exhibit A-1), the index price (low) specified on Exhibit A-1 for such Primary Delivery Point, (ii) with respect to each Alternate Delivery Point to which the Parties mutually agree pursuant to Section 5.1, the index price (low) that is mutually agreed and identified by the Parties in connection therewith, or if no such index price is identified, the index price (low) specified on Exhibit A-1 for the Primary Delivery Point from which quantities are being shifted to the Alternate Delivery Point, or (iii) with respect to each Alternate Delivery Point specified pursuant to Exhibit A-3, the index price (low) identified in accordance with Exhibit A-3. Interest Rate Swap means the ISDA Master Agreement and related annexes and Confirmation (as defined therein) dated as of the Execution DateOctober 3, 2007 between Buyer and the Seller. Investment Agreement means the Investment Agreement, dated as of [ ], 2013, by and among Seller, Buyer and Indenture Trustee. Law means any statute, law, rule or regulation or any judicial or administrative interpretation thereof having the effect of the foregoing imposed by a Government Agency whether in effect as of the Execution Date or at any respective time in the future. Liquid Point has the meaning specified in paragraph 2(d) of Exhibit A-3. Minimum Remarketing Sales Price has the meaning specified in Section 7.3(c)(ii)(C). MMBtu means one million (1,000,000) Btu. Month means the period beginning at 7:00 a.m. PPT on the first day of a calendar month and ending at 7:00 a.m. PPT on the first day of the next calendar month. The term Monthly shall be construed accordingly. Monthly Contract Quantity means, with respect to any Month, the sum of the Daily Contract Quantities for all Gas Days and Delivery Points in such Month. 6

156 Monthly Index Price means, with respect to any Delivery Point and any Month, (i) with respect to each Primary Delivery Point (as shown on Exhibit A-1), the monthly index price specified on Exhibit A-1 for such Primary Delivery Point, (ii) with respect to each Alternate Delivery Point to which the Parties mutually agree pursuant to Section 5.1, the monthly index price that is mutually agreed and identified by the Parties in connection therewith, or if no such index price is identified, the monthly index price specified on Exhibit A-1 for the Primary Delivery Point from which quantities are being shifted to the Alternate Delivery Point, or (iii) with respect to each Alternate Delivery Point specified pursuant to Exhibit A-3, the monthly index price identified in accordance with Exhibit A-3. Monthly Remarketing Notice has the meaning specified in Section 7.1. Moody s means Moody s Investor Service, Inc. or any successor to its credit ratings services. Municipal Utility means any Person that (i) is a governmental person as defined in U.S. Treas. Reg (b), and (ii) owns either or both a Gas distribution utility or an electric distribution utility (or provides Gas or electricity at wholesale to entities described in clause (i) that own such utilities). Buyer may from time to time revise the definition of Municipal Utility to conform to the applicable provisions of the Code by delivery of written notice to Seller setting forth the revised definition together with a Tax Opinion. Net Participant Price means the amount specified as the Net Participant Price in the Pricing Agreement. New PDP has the meaning specified in paragraph 2(a) of Exhibit A-3. Nominating Agent means a Person designated as the Nominating Agent on Exhibit F. Non-Service Area Remarketing Limit means a quantity of Gas, in MMBtu, equal to 10% of the total quantity of Gas (measured in Btus) to be delivered hereunder and under the Related Prepaid Contracts in the aggregate over the Delivery Period, as such Non-Service Area Remarketing Limit may be increased from time to time upon receipt by the Buyer and Seller of a Tax Opinion setting forth a higher Non-Service Area Remarketing Limit. Non-Service Area Remarketing Proceeds has the meaning specified in Section 7.3(c)(i). Non-Service Area Sale means a sale (other than a Qualified Sale) of Gas to a Municipal Utility or a State or political subdivision thereof that in each case agrees in writing to use all of such Gas without Private Business Use. Non-Service Area Sales Ledger has the meaning specified in Section 7.3(c)(i). Original Agreement has the meaning specified in the Preamble. Pacific Prevailing Time or PPT means Pacific Daylight Savings Time when such time is applicable and otherwise means Pacific Standard Time. 7

157 Party has the meaning specified in the preamble. Persistent Delivery Failure means the occurrence of an Aggregate Shortfall Quantity at any Delivery Point that is: (i) equal to 100% of the Aggregate DCQ for such Delivery Point on any 15 consecutive Gas Days; (ii) equal to 50% or more of the Aggregate DCQ for such Delivery Point on any 90 consecutive Gas Days; (iii) except with respect to Revised Delivery Points, equal to 15% or more of the Aggregate DCQ (calculated only with respect to this Agreement and each Related Agreement where such Delivery Point is a Delivery Point) on any 180 Gas Days in any period of 365 consecutive Gas Days; or (iv) with respect to Revised Delivery Points, equal to 35% or more of the Aggregate DCQ on any 180 Gas Days in any period of 365 consecutive Gas Days. Person means any individual, corporation, partnership, joint venture, trust, unincorporated organization or Government Agency. Prepayment means the amount specified as the Prepayment for this Agreement in the Pricing Agreement. Pricing Agreement means the Pricing Agreement of even date herewith, dated as of October 3, 2007, between Buyer and Seller. Primary Delivery Point means each delivery point specified in Exhibit A-1, as such may be modified pursuant to Exhibit A-3. Code. Private Business Use has the meaning ascribed to such term by Section 141 of the Project Participant means any Project Participant (as defined in the Bond Indenture) that is purchasing from Buyer Gas delivered under this Agreement. Qualified Sale means the sale of Gas to a Municipal Utility that agrees in writing (i) to use all of such Gas for a Qualifying Use and without Private Business Use and (ii) not to count any purchase of such Gas towards any remediation obligations such Municipal Utility may have with respect to proceeds received from the sale of property purchased with tax-exempt financing proceeds. Qualifying Use with respect to Gas or electricity has the meaning specified for the term qualifying use in U.S. Treas. Reg (e)(2)(iii)(A)(2) or (B)(2), as applicable. Receivables Purchase Agreement means the Receivables Purchase Agreement of even date herewith among Buyer, Seller and the Indenture Trustee. 8

158 Receiving Transporter means the Transporter taking Gas at a Delivery Point, or absent such Transporter, the Transporter delivering Gas at such Delivery Point. Related Prepaid Contract means any prepaid natural gas sales agreement (other than this Agreement) entered into as of the date hereofoctober 3, 2007 by and between Buyer and Seller. Remarketing Default has the meaning specified in Section 7.3(d). Remarketing Fee means the amount specified as the Remarketing Fee in the Pricing Agreement. Remarketing Notice has the meaning specified in Section 7.3(a). Remarketing Purchase Price has the meaning specified in Section 7.3(c)(ii)(C). Remarketing Reserve Account has the meaning specified in the Bond Indenture. Replacement Gas means Gas purchased by Buyer or a Project Participant to replace any Shortfall Quantity provided that such Gas is (i) purchased for delivery in the Month such Shortfall Quantity arises or (ii) purchased pursuant to Section 4.1(d) for delivery in the following Month either (A) to replace Gas from Buyer s or such Project Participant s Gas storage inventory used to cover such Shortfall Quantity, or (B) for delivery by Buyer or a Project Participant to a Transporter to cover a shortfall imbalance caused by such Shortfall Quantity. Revised Delivery Point has the meaning specified in paragraph 4(a) of Exhibit A-3. RPA means the Amended and Restated Receivables Purchase Agreement, dated as of [ ], 2013, by and among Seller, Buyer and the Indenture Trustee. S&P means Standard & Poor s Ratings Group (a division of The McGraw-Hill Companies) or any successor to its credit ratings services. Seller has the meaning specified in the preamble. Seller Default has the meaning specified in Section Seller s Guarantor means The Goldman Sachs Group, Inc. or any guarantor under a replacement guaranty permitted pursuant to the terms of the Seller s Guaranty. Seller s Guaranty means the guaranty to be, dated October 3, 2007 and as amended as of the date hereof, delivered by The Goldman Sachs Group, Inc. in favor of Buyer, or any replacement therefor permitted pursuant to the terms of the Seller s Guaranty, which guaranty will be dated as of the date the Prepayment is delivered. Seller Non-Default Termination Event has the meaning specified in Section 17.3(a). Seller Swap means (i) the transaction confirmation specifying this Agreement as the Specified Prepaid Contract therein, which transaction confirmation was entered into under the ISDA Master Agreement dated as of the Execution Date by Seller and the Swap Counterparty, 9

159 pursuant to which transaction confirmation Seller is the fixed price payer and the Swap Counterparty is the floating price payer with respect to an aggregate notional quantity of Gas in each Month that is equal to the quantity of Gas to be delivered hereunder in such Month and for a term that is equivalent to the Delivery Period of this Agreement, and (ii) each replacement Seller Swap entered into pursuant to Section Shortfall Quantity has the meaning specified in Section 4.1(a). SoCal System means the Gas transportation and distribution system in Southern California owned by the Southern California Gas Company. Specified Discount means the amount specified as the Specified Discount in the Pricing Agreement. Swap Counterparty means [Swap Counterparty]Mitsubishi UFJ Securities International PLC, its successors and assigns, and any other Person that becomes counterparty to Buyer under a Buyer Swap or to Seller under a Seller Swap, in each case pursuant to Section Swap Counterparty Insolvency Event has the meaning specified in Section 17.3(c). Swap Early Termination Date means an Early Termination Date, as defined in either the Buyer Swap or the Seller Swap, as applicable. Swap Replacement Period has the meaning specified in Section 17.5(e). Tax Opinion means an Opinion of Bond Counsel (as defined in the Bond Indenture) to the effect that an action proposed to be taken is not prohibited by the Bond Indenture or the laws of the State of California and will not adversely affect the exclusion from gross income for federal income tax purposes of interest on any Bonds. Termination Payment means, with respect to any Early Termination Payment Date, the amount specified on the applicable schedule related to this Agreement attached to Exhibit B of the Pricing Agreement for the calendar month in which such Early Termination Payment Date occurs, without any set-off or netting of amounts then due from Buyer. Transaction Documents shall mean: (i) this Agreement; (ii) the Pricing Agreement; (iii) the Gas Scheduling Agreement; (iv) the Interest Rate Swap; and (v) the Receivables Purchase AgreementRPA. Transporters shall mean all Gas gathering or pipeline companies, or local distribution companies, acting in the capacity of a transporter, transporting Gas to be delivered or received under this Agreement upstream or downstream, respectively, of the Delivery Point. Section 1.2 Definitions; Interpretation. References to Sections, Annexes, Schedules and Exhibits shall be to Sections, Annexes, Schedules and Exhibits, as the case may be, of this Agreement unless otherwise specifically provided. Section headings in this Agreement are included herein for convenience of reference only and shall not constitute a part 10

160 of this Agreement for any other purpose or be given any substantive effect. Any of the terms defined herein may, unless the context otherwise requires, be used in the singular or the plural, depending on the reference. The use herein of the word include or including, when following any general statement, term or matter, shall not be construed to limit such statement, term or matter to the specific items or matters set forth immediately following such word or to similar items or matters, whether or not nonlimiting language (such as without limitation or but not limited to or words of similar import) is used with reference thereto, but rather shall be deemed to refer to all other items or matters that fall within the broadest possible scope of such general statement, term or matter. Any references herein to any agreement or document includes all amendments, supplements or restatements to and of such agreement or document as may occur from time to time. ARTICLE II EXECUTION DATE AND DELIVERY PERIOD Section 2.1 Execution Date; Delivery Period. This Agreement shall become effective upon the Execution Date and, unless this Agreement is terminated early pursuant to Section 2.2, all of Seller s and Buyer s obligations hereunder shall be deemed to have been incurred upon the Execution Date. The delivery period under this Agreement (the Delivery Period ) commenced at the beginning of the Gas Day that commenced at 7:00 a.m. PPT on July 1, 2008, and shall continue in effect until the end of the Gas Day that commences at 7:00 a.m. PPT on September 30, 2035, or if earlier, on the Early Termination Date. Section 2.2 Termination by Seller Prior to Delivery Period. Seller shall have no obligation to perform under this Agreement unless and until it has received the Prepayment from Buyer pursuant to Section 3.2. In the event Seller has not received the Prepayment prior to noon local time in New York, New York on October 11, 2007, Seller shall have the right, until such Prepayment has been paid, to terminate this Agreement without any further obligation or liability of either Party. For the avoidance of doubt, no Termination Payment or Additional Termination Payment shall be payable by Seller under any circumstances if this Agreement terminates prior to Seller s receipt of the Prepayment. ARTICLE III SALE AND PURCHASE Section 3.1 Sale and Purchase of Gas. Seller agrees to sell and deliver or cause to be delivered to Buyer, and Buyer agrees to purchase and take or cause to be taken from Seller, the respective Daily Contract Quantity for each Gas Day during the Delivery Period at each Delivery Point pursuant to and on the terms and conditions set forth in this Agreement. Section 3.2 Price. The price payable per MMBtu for Gas purchased pursuant to Section 3.1 shall be the Fixed Price. The Fixed Price is being prepaid by Buyer in a discounted sum pursuant to Section 3.3. Section 3.3 Prepayment. Prior to the commencement of the Delivery Period, Buyer shall paypaid Seller for all Gas to be delivered during the Delivery Period in an amount equal to the Prepayment, and Seller shall acceptaccepted the Prepayment as payment in full for all Gas to 11

161 be delivered hereunder. Buyer shall pay the Prepayment in a single lump sum payment by wire transfer of immediately available funds to an account designated by Seller. In no event shall Buyer be entitled to any rebate or refund of the Prepayment, but nothing in this Section shall limit Buyer s rights under Article IV for Seller s failure to deliver Gas (whether or not excused) or Article XVII upon early termination of this Agreement. In no event shall Buyer be required to pay the Prepayment unless and until the Bonds are issued in exchange for a purchase price sufficient to pay costs of issuance, to fund required reserves under the Bond Indenture (or purchase surety bonds in lieu of funding such reserves), and to pay the Prepayment. Buyer will use Commercially Reasonable Efforts to issue the Bonds by such date for such a purchase price. ARTICLE IV FAILURE TO DELIVER OR TAKE GAS Section 4.1 (a) Seller s Failure to Deliver (Not Due to Force Majeure). If, on any Gas Day: (i) Seller fails to deliver all or any portion of the Daily Contract Quantity at any Delivery Point pursuant to the terms of this Agreement; and (ii) such failure is not due to either (A) the actions or inactions of Buyer (including any breach of Section 4.1(f)), or (B) Force Majeure, then the portion of the Daily Contract Quantity that Seller failed to deliver shall be a Shortfall Quantity and Buyer shall exercise Commercially Reasonable Efforts to purchase Replacement Gas; provided, however, if the Daily Index Price for such Gas Day at such Delivery Point is less than the Monthly Index Price applicable to such Gas Day at such Delivery Point, then (i) Buyer shall not be required to exercise such Commercially Reasonable Efforts, (ii) Buyer and its Project Participants will be deemed, for purposes of this Agreement, not to have purchased Replacement Gas for such Shortfall Quantity, (iii) Section 4.1(c) shall apply exclusively with respect to such Shortfall Quantity, and (iv) Sections 4.1(b) and (d) shall not apply to such Shortfall Quantity. (b) To the extent Buyer or any of its Project Participants actually purchases Replacement Gas with respect to any Shortfall Quantity for delivery prior to the end of the Month in which such Shortfall Quantity arose (and is not deemed by this Section 4.1 not to have done so), then Seller shall pay to Buyer the result determined by the following formula: P = Q x (RP + AF) Where: P = The amount payable by Seller under this Section 4.1(b) Q = The portion of the Shortfall Quantity described in the lead-in to this Section 4.1(b) above 12

162 RP = The replacement price (in $/MMBtu) paid by Buyer or a Project Participant for such Replacement Gas AF = The Administrative Fee (c) Subject to Section 4.1(d), if, with respect to any Shortfall Quantity, Replacement Gas has not been purchased for delivery prior to the end of the Month in which such Shortfall Quantity arose (or is deemed by this Section 4.1 not to have been purchased), then Seller shall pay to Buyer the result determined by the following formula: P = Q x IP Where: P = The amount payable by Seller under this Section 4.1(c) Q = The portion of the Shortfall Quantity described in the lead-in to this Section 4.1(c) above IP = The Monthly Index Price applicable to the Gas Day and Delivery Point for which the Shortfall Quantity arose (d) If, with respect to any Shortfall Quantity that arises on a Gas Day that commences on any of the last seven (7) Business Days of a Month, Buyer or a Project Participant purchases Replacement Gas for delivery in the Month following the Month in which such Shortfall Quantity arose (and is not deemed by this Section 4.1 not to have done so), then Seller shall pay to Buyer, in addition to those amounts already paid under Section 4.1(c), the positive result, if any, determined by the following formula: P = Q x ((RP + AF) IP) Where: P = The amount payable by Seller under this Section 4.1(d) Q = The portion of the Shortfall Quantity described in the lead-in to this Section 4.1(d) above RP = The replacement price (in $/MMBtu) paid by Buyer or such Project Participant for such Replacement Gas AF = The Administrative Fee IP = The Monthly Index Price applicable to the Gas Day and Delivery Point for which the Shortfall Quantity arose (e) The replacement prices referred to in this Section 4.1 shall include any transportation costs (including fuel, storage withdrawal and injection costs), but shall not include any administrative or other internal costs incurred by Buyer or any Project Participant (it being 13

163 understood that such administrative and other internal costs are being compensated by way of the Administrative Fee included above). Seller s obligations under Sections 4.1(b) and (d) to reimburse Buyer for the replacement price of any Replacement Gas incurred by Buyer or any Project Participant shall be limited to the cost of Replacement Gas that is purchased (i) at a replacement price that is Commercially Reasonable with respect to the timing and manner of purchase given the amount of notice provided by the Seller, the immediacy of Buyer s or the Project Participant s Gas consumption needs or redelivery obligations, the quantities involved, the anticipated length of failure by Seller, the availability of Gas in Buyer s or such Project Participant s Gas storage inventory, and any other relevant factors, and (ii) using Commercially Reasonable Efforts to mitigate replacement damages paid by Seller. (f) With respect to Gas to be delivered from Seller to Buyer under this Agreement, Buyer shall monitor nominations and deliveries at each Delivery Point for each Gas Day and shall promptly notify Seller upon becoming aware that such nominations or deliveries might result in a Shortfall Quantity with respect to such Delivery Point. With respect to Gas to be delivered from Seller to Nominating Agent under this Agreement, Buyer shall cause such Nominating Agent to monitor nominations and deliveries at each Delivery Point for each Gas Day and to promptly notify Seller if Nominating Agent becomes aware that such nominations or deliveries could reasonably be expected to result in a Shortfall Quantity with respect to such Delivery Point. (g) Imbalance Charges shall not be recovered under this Section 4.1, but may be provided in accordance with Section 5.5. Section 4.2 Buyer s Failure to Take (Not Due to Force Majeure). If, on any Gas Day: (a) Buyer fails to take or cause to be taken all or any portion of the Daily Contract Quantity at any Delivery Point on any Gas Day pursuant to the terms of this Agreement; and (b) such failure is due to either the actions or inactions of Buyer, is not due to Force Majeure and is not with respect to Gas for which a Remarketing Notice has been given in accordance with Section 7.1 or 7.2, then the Nominating Agent (or, if none, Buyer) shall be deemed to have issued a Daily Remarketing Notice with respect to the portion not taken, provided that the Remarketing Fee that would otherwise have been applicable to such portion shall be increased by an amount equal to the Administrative Fee. Imbalance Charges shall not be recovered under this Section 4.2, but may be provided in accordance with Section 5.5. Section 4.3 Failure to Deliver or Take Due to Force Majeure. If during any Month: (a) Buyer fails to take or cause to be taken or Seller fails to deliver all or any portion of the Monthly Contract Quantity at any Delivery Point pursuant to the terms of this Agreement; and (b) such failure is due to Force Majeure claimed by either Party, 14

164 then Seller shall pay to Buyer the result determined by the following formula with respect to each such Delivery Point: P = Q x IP Where: P = The amount payable by Seller under this Section 4.3 Q = The quantity of Gas described in the lead-in to this Section 4.3 above IP = The Monthly Index Price applicable to such Month for such Delivery Point Section 4.4 Make-Up Delivery in Lieu of Payment. Seller and the Nominating Agent may mutually agree, in lieu of payment pursuant to Section 4.1, 4.2 or 4.3, to make up all or any portion of the Daily Contract Quantity or Monthly Contract Quantity not delivered or taken by increasing deliveries and takes over the remainder of the Month in which such failure occurred or in the following Month. If a Shortfall Quantity is made up in lieu of payment in accordance with the preceding sentence, such quantity will no longer be considered a Shortfall Quantity in calculating a Persistent Delivery Failure, and the made up quantity will be applied to the most recent Shortfall Quantities. Section 4.5 Sole Remedies. Except with respect to the payment of Imbalance Charges pursuant to Section 5.5, termination as the result of Persistent Delivery Failure pursuant to Section 17.3(b)(iv), and obligations of Seller under Section 7.3(c)(iii), the remedies set forth in this Article IV shall be each Party s sole and exclusive remedies for any failure by the other Party to deliver or take Gas pursuant to this Agreement. ARTICLE V TRANSPORTATION AND DELIVERY; COMMUNICATIONS Section 5.1 Delivery Points. (a) All Gas delivered hereunder shall be delivered and received at the Primary Delivery Point(s) or to any other point (an Alternate Delivery Point ) that has been mutually agreed by Buyer and Seller or designated by Buyer pursuant to Exhibit A-3; provided, however that any time after September 1, 2027, Seller may provide Buyer with a notice of a Physical Premium Differential (as defined Section 5.1(c) below). Seller and Buyer upon notice to the Nominating Agent shall have the right to mutually agree to an Alternate Delivery Point for all or any portion of the Daily Contract Quantity. (b) Within 270 days after receipt of a notice of Physical Premium Differential, Buyer will irrevocably elect one of the following options, with such option becoming effective as of the first Gas Day in the first month that follows the annual anniversary of the date such notice was delivered (the Option Effective Date ): 15

165 (i) Buyer will pay the Physical Premium Differential to Seller on a monthly basis for all Gas that is delivered to Buyer (including for make up deliveries of Gas pursuant to Section 4.4) under this Agreement on or after the Option Effective Date through the end of the term of this Agreement; or (ii) Exhibit A-1 of this Agreement will revert to Exhibit A-1 as in effect under the Original Agreement immediately prior to December 1, 2009 with such reversion effective as of the Option Effective Date. If any index price set forth on Exhibit A-1 as in effect under the Original Agreement immediately prior to December 1, 2009 is no longer reported at the time of such reversion described in the immediately preceding sentence, the Parties will use the process set forth in Section of this Agreement to establish the relevant index prices for delivery at the Border Delivery Point (as defined in Section 5.1(c)(ii) below). If Buyer fails to elect either option within the time period specified above, Buyer will be deemed to have elected the option set forth in clause (ii) above. If Buyer elects, or is deemed to have elected, the option set forth in clause (ii) above, each of Buyer and Seller, as applicable, agree to deliver a revised Exhibit C under the Buyer Swap and the Seller Swap, effective as of the Option Effective Date, to reflect a change in the Floating Prices under each such swap to correspond to the Monthly Index Price set forth on the Exhibit A-1 of this Agreement as in force under the Original Agreement immediately prior to December 1, 2009 or otherwise established in accordance with Section (c) As used above, Physical Premium Differential means an amount calculated by Seller in a commercially reasonable manner as the positive amount, if any, by which: (i) the physical premium (measured in $/MMBtu) that would be necessary for Seller to obtain and deliver the Daily Contract Quantity to the Primary Delivery Point set forth on Exhibit A-1 (the Citygate Delivery Point ) for the period commencing on the Option Effective Date through the end of the term of such Prepaid Agreement; exceeds (ii) the physical premium (measured in $/MMBtu) that would be necessary for Seller to obtain and deliver the Daily Contract Quantity to the Primary Delivery Point set forth on Exhibit A-1 as in effect under the Original Agreement immediately prior to December 1, 2009 (the Border Delivery Point ), with such physical premium for the Border Delivery Point being calculated by Seller as the average physical premium of all interconnects for such Border Delivery Point for which Seller is able to obtain quotations through the exercise of Commercially Reasonable Efforts. Section 5.2 Responsibility for Transportation; Permits. (a) Seller shall obtain, or caused to be obtained, and pay for all processing, gathering, and transportation necessary for delivery of the respective Daily Contract Quantities as to each Delivery Point. Buyer shall obtain, or cause to be obtained, such receipt point rights 16

166 and pay all associated costs necessary to receive the respective Daily Contract Quantities at each Delivery Point and to transport such Daily Contract Quantities from each Delivery Point. (b) Should Seller receive an operational flow order or other order or notice from a Transporter requiring action to be taken in connection with the Gas flowing under this Agreement (a Critical Notice ), Seller shall notify the Nominating Agent of the Critical Notice and provide the Nominating Agent a copy of the same by electronic mail or facsimile if requested within a Commercially Reasonable timeframe. Should Buyer or the Nominating Agent receive a Critical Notice, Buyer shall notify (or cause the Nominating Agent to notify) Seller of the Critical Notice and provide Seller a copy of same by electronic mail or facsimile if requested within a Commercially Reasonable timeframe. The Parties shall exercise Commercially Reasonable Efforts (and Buyer shall cause the Nominating Agent to exercise Commercially Reasonable Efforts) to take the actions required by the Critical Notice and within the time prescribed by the applicable Transporter. A Party shall be responsible to the other Party for any Claims associated with any Critical Notice (i) of which the responsible Party failed to give notice as required hereunder or (ii) under which the responsible Party failed (or with respect to Buyer as the responsible Party, the Nominating Agent failed) to take the action required by the Critical Notice within the time prescribed, provided the notice to the responsible Party was timely delivered. Section 5.3 Title and Risk of Loss. (a) Title to the Gas delivered hereunder and risk of loss shall pass from Seller (or its supplier if directed by Seller) to Buyer (or its Nominating Agent if directed by Buyer) at the Delivery Points. (b) As between the Parties, Seller shall be deemed to be in exclusive control and possession of the Gas delivered hereunder, and responsible for any damage or injury caused thereby, prior to the time such Gas shall have been delivered to Buyer (or the Nominating Agent) at the Delivery Points. After delivery of Gas to Buyer (or the Nominating Agent) at the Delivery Points, as between the Parties Buyer shall be deemed to be in exclusive control and possession thereof and responsible for any injury or damage caused thereby. Each Party (each, an Indemnifying Party ) assumes all liability for and shall indemnify, defend and hold harmless the other Party from any Claims, including death of Persons, arising from any act or incident occurring when title to Gas is vested in the Indemnifying Party. IT IS THE INTENT OF THE PARTIES THAT THIS INDEMNITY BE WITHOUT REGARD TO THE CAUSES THEREOF, INCLUDING, WITHOUT LIMITATION, THE NEGLIGENCE OF ANY INDEMNIFIED PARTY, WHETHER SUCH NEGLIGENCE BE SOLE, JOINT OR CONCURRENT, OR ACTIVE OR PASSIVE OR THE STRICT LIABILITY OF ANY INDEMNIFIED PARTY. (c) With respect to the indemnity under Section 5.3(b) above, the indemnity is given to the fullest extent permitted by applicable Law and the following provisions shall be applicable. The indemnified Party shall promptly notify the Indemnifying Party in writing of any Claim and the Indemnifying Party shall have the right to assume its investigation and defense, including employment of counsel, and shall be obligated to pay related court costs, and experts fees and to post any appeals bonds; provided, however, that the indemnified Party shall 17

167 have the right to employ at its expense separate counsel and participate in the defense of any Claim. The Indemnifying Party shall not be liable for any settlement of a Claim without its express written consent thereto. In order to prevent double recovery, the indemnified Party shall reimburse the Indemnifying Party for payments or costs incurred in respect of an indemnity with the proceeds of any judgment, insurance, bond, surety or other recovery made by the indemnified Party with respect to a covered event. Section 5.4 Daily Flow Rates. Unless otherwise agreed by the Parties or required by the Receiving Transporter or the Delivering Transporter, respectively, Seller shall nominate, schedule and deliver, and Buyer shall cause the Nominating Agent to nominate, schedule and take, the respective Daily Contract Quantities (on a ratable basis within each Month) at each Delivery Point in accordance with the requirements of the Receiving Transporter and Delivering Transporters at such Delivery Point. Section 5.5 Imbalances. The Parties shall use (and Buyer shall cause the Nominating Agent to use) Commercially Reasonable Efforts to avoid the imposition of any Imbalance Charges. If Buyer or its Nominating Agent or Seller receives an invoice from a Transporter that includes Imbalance Charges related to the obligations of either Party under this Agreement, the Parties shall determine the validity as well as the cause of such Imbalance Charges. If the Imbalance Charges were incurred as a result of Buyer s takes of quantities of Gas greater than or less than the respective Daily Contract Quantity at any Delivery Point (for reasons other than Seller s failure to deliver), then Buyer shall pay for such Imbalance Charges or reimburse Seller for such Imbalance Charges paid by Seller. If the Imbalance Charges were incurred as a result of Seller s delivery of quantities of Gas greater than or less than the respective Daily Contract Quantities at any Delivery Point (for reasons other than Buyer s failure to receive), then Seller shall pay for such Imbalance Charges or reimburse Buyer for such Imbalance Charges paid by Buyer or the Nominating Agent. Section 5.6 Nominating Agent. (a) Buyer hereby appoints the Nominating Agent set forth on Exhibit E as its agent with respect to the actions specified herein for which the Nominating Agent has the right to act. Buyer shall be solely responsible to Seller for insuring that the Nominating Agent complies with all relevant requirements of this Agreement. (b) Buyer shall be deemed to have notice of all actions that are taken and all communications that are delivered by the Nominating Agent within the scope of Nominating Agent s agency as described in this Agreement, and Seller shall have no obligation to notify Buyer thereof. (c) Unless Seller has received five (5) Business Days written notice from Buyer revoking the agency rights granted to the Nominating Agent, Seller may rely on notices or other actions taken by Buyer or the Nominating Agent and, with respect to any notice issued or action taken that is within the scope of Nominating Agent s agency as described in this Agreement, Seller may, in its discretion, rely on notices or other actions taken by Buyer or the Nominating Agent and Seller has the right to exclusively rely on any notices delivered by the Nominating Agent, regardless of any conflicting notices that it may receive from Buyer. If 18

168 Buyer revokes the Nominating Agent s agency rights in accordance with the foregoing sentence, any such rights shall revert to Buyer. (d) With respect to any Gas delivered or required to be delivered to and taken by the Buyer hereunder and the Nominating Agent under the Gas Supply Contract, (i) Seller s obligations to deliver such Gas to Buyer will be satisfied in all respects by delivery to the Nominating Agent and Buyer s obligations to take such Gas from Seller will be satisfied in all respects by receipt of such Gas by the Nominating Agent, (ii) Buyer will be solely responsible (as between Buyer and Seller and without prejudice to Buyer s rights against the Nominating Agent) for the Nominating Agent s failure to receive any such Gas, including with respect to Imbalance Charges and with respect to any failure to take such Gas, as if such Gas were being scheduled for delivery to Buyer directly, (iii) without prejudice to Buyer s direct rights against Seller hereunder and preserving all of Buyer s rights hereunder, Buyer will be responsible to Seller for any Claims asserted by the Nominating Agent against Seller related to scheduling or delivery of such Gas to the extent that the amount of such Claims and any Claims paid to Buyer exceed the Claims that may be lawfully recovered by Buyer from Seller hereunder, and (iv) all other provisions of this Agreement will apply as if such Gas were being delivered to Buyer at the relevant Delivery Point. (e) The Parties acknowledge that in addition to the relationship of the Parties to the Nominating Agent as set forth in this Section 5.6, the Parties have agreed to certain terms concerning the coordination of Gas deliveries to be made hereunder by entering into the Gas Scheduling Agreement under which the Nominating Agent may appoint or serve as a Receipt Scheduling Party (as defined therein). Section 5.7 Gas Scheduling Agreement. Buyer and Seller shall comply with the provisions of the Gas Scheduling Agreement as it applies to this Agreement and the Gas Supply Contract. ARTICLE VI QUALITY AND MEASUREMENT Neither Buyer nor the Nominating Agent shall be required to accept Gas delivered by Seller that does not meet the pressure, quality and heat content requirements of the Receiving Transporter as detailed in the applicable pipeline tariff. Buyer s sole and exclusive remedy against Seller with respect to any Gas that fails to meet such pressure, quality and heat content requirements shall be the right to reject non-conforming Gas and to receive payment under Article IV. If such rejected Gas meets the pressure, quality and heat content requirements of the Delivering Transporter, but does not meet such requirements of the Receiving Transporter, any such rejection by Buyer and failure to deliver by Seller shall be deemed to be excused by Force Majeure. If such rejected Gas does not meet such requirements of either the Receiving Transporter or the Delivering Transporter, Seller shall be deemed to have failed to deliver any such Gas that is properly rejected. The unit of quantity measurement for purposes of this Agreement shall be one MMBtu dry. Measurement of Gas quantities under this Agreement shall be in accordance with the established procedures of the applicable Delivery Point. With respect to any measurement of Gas delivered or received under this Agreement at any Delivery Point, the measurement of such Gas (including the definition of Btu used in making such measurement) 19

169 by the operator of such Delivery Point shall be deemed to be conclusive; provided, however, if the operator of such Delivery Point revises its measurement statements for Gas, such revision shall be effective as the measurement of Gas for the purposes of this Agreement and may be corrected, pursuant to Section If the operator of such Delivery Point measures Gas in terms of decatherms, one decatherm (as determined by such operator) will be deemed to equal one MMBtu for purposes of this Agreement. ARTICLE VII GAS REMARKETING Section 7.1 Monthly Remarketing Notice. The Nominating Agent (or, if none, Buyer) may, and if Buyer is required to do so under the Bond Indenture shall, request Seller to remarket all or a specified part of the Daily Contract Quantities for any Delivery Point for a period of one or more Months by delivering to Seller written notice substantially in the form attached hereto as Exhibit F (a Monthly Remarketing Notice ) specifying: (a) the portion (in MMBtu) of such Daily Contract Quantities to be remarketed with respect to such Delivery Point, which shall be an equal amount for each Gas Day within a Month, and (b) the Month(s) in which such Gas is to be remarketed. Any Monthly Remarketing Notice shall be delivered to Seller not later than three (3) Business Days prior to the last day of exchange trading for Henry Hub Natural Gas Futures Contracts on the New York Mercantile Exchange (or any successor thereto) for deliveries in the first Month in which Gas is to be remarketed. Section 7.2 Daily Remarketing Notice. The Nominating Agent (or, if none, Buyer) may, and if Buyer is required to do so under the Bond Indenture shall, request Seller to remarket all or a specified part of the Daily Contract Quantities for any Delivery Point for a period of one or more Gas Days by delivering to Seller written notice substantially in the form attached hereto as Exhibit F (a Daily Remarketing Notice ) specifying: (a) the portion (in MMBtu) of such Daily Contract Quantities to be remarketed with respect to such Delivery Point, which shall be an equal amount for each Gas Day specified in the notice, and (b) the Gas Day(s) for which such Gas is to be remarketed. Any Daily Remarketing Notice shall be delivered to Seller not later than 6:30 am PPT two (2) Business Days prior to nominations leaving control of the nominating party for first timely nomination cycle for the Transporter at the Delivery Point where such Gas was originally intended to be delivered. If a Transporter modifies its nomination process, Seller may propose to modify the deadline specified in this Section 7.2, subject to the Nominating Agent s consent, which consent shall not be unreasonably withheld. Notwithstanding the foregoing, the Nominating Agent or Buyer shall be deemed to have issued a Daily Remarketing Notice under the circumstances described in Section 4.2, provided that an increased Remarketing Fee as described in Section 4.2 shall apply in such circumstances. 20

170 Section 7.3 Remarketing to Municipal Utilities. (a) In the event Seller receives a Monthly Remarketing Notice or Daily Remarketing Notice (each, a Remarketing Notice ), Seller shall use Commercially Reasonable Efforts to remarket or cause to be remarketed all Gas specified in such Remarketing Notice. In exercising such Commercially Reasonable Efforts, Seller shall first attempt to remarket or cause to be remarketed all Gas specified in a Remarketing Notice in Qualified Sales and then, if it is unable to so remarket all of such Gas for such purpose, in Non-Service Area Sales. For the avoidance of doubt, Seller shall not be required to remarket any such Gas at a net price to Seller (after deducting all transportation costs and all other costs) that is anticipated to be less than (i) in an initial remarketing pursuant to a Monthly Remarketing Notice, the Monthly Index Price applicable to such Gas, (ii) in an initial remarketing pursuant to a Daily Remarketing Notice, the Index Price (Low) applicable to such Gas, and (iii) in any remediation remarketing pursuant to Section 7.3(c)(ii), the Minimum Remarketing Sales Price. (b) If Seller is unable to remarket all or any portion of the Gas designated in a Remarketing Notice, then Seller shall purchase such Gas for its own account at the prices specified in Section 7.4 as if such Gas had been remarketed to it. (c) Non-Service Area and Fully Disqualified Remarketing Proceeds. (i) Seller shall maintain four separate ledgers related to remarketing proceeds as described below. One ledger (the Non-Service Area Sales Ledger ) shall include (A) as dollar credits (x) all proceeds received by the Buyer under Section 7.4(b) of this Agreement and Section 7.4(b) of all Related Prepaid Contracts from the remarketing of Gas in any Non-Service Area Sale, and (y) with respect to Gas delivered to Buyer under this Agreement or any Related Prepaid Contract and sold either by Buyer or a Project Participant (other than pursuant to a remarketing by Seller under this Article VII) in any Non-Service Area Sale, the aggregate proceeds received from such sales (each of (x) and (y), as applicable, Non-Service Area Remarketing Proceeds ) and (B) as a Btu credit, the Btus of Gas in respect of which such proceeds were received. Another ledger (the Fully Disqualified Sales Ledger ) shall include (A) as dollar credits (x) all proceeds received by Buyer under Section 7.4(c) of this Agreement and Section 7.4(c) of all Related Prepaid Contracts in any Fully Disqualified Sale, and (y) with respect to Gas delivered to Buyer under this Agreement or any Related Prepaid Contract and sold either by Buyer or a Project Participant (other than pursuant to a remarketing by Seller under this Article VII) in any Fully Disqualified Sale, the aggregate proceeds received from such sales (each of (x) and (y), as applicable, Fully Disqualified Remarketing Proceeds ) and (B) as a Btu credit, the Btus of Gas in respect of which such proceeds were received. Each such credit shall be dated as of the first day of the Month prior to the Month in which Buyer (under this Agreement) or the Project Participant receives the relevant proceeds. The other two ledgers shall be maintained by Seller as described in Section 7.3(c)(vi). For the avoidance of doubt, the ledgers described in this Section 7.3(c)(i) and in Section 7.3(c)(vi) and all debits and credits to such ledgers shall be kept on an aggregate basis for this Agreement and all Related Prepaid Contracts. Pursuant to Section 14.1, Buyer shall notify Seller in the Buyer s Statement of the receipt and amount of any Non-Service Area Remarketing Proceeds or Fully Disqualified Remarketing Proceeds that 21

171 are received by Buyer or a Project Participant other than pursuant to a remarketing by Seller under this Article VII ( Direct Sale Proceeds ) and the Btus attributable to any dollar credit. For the avoidance of doubt, Direct Sale Proceeds shall include any cash that Buyer or a Project Participant may receive from a balancer in respect of any Gas sold pursuant to this Agreement. Direct Sale Proceeds shall not be included on the Non- Service Area Sales Ledger or the Fully Disqualified Sales Ledger if Seller is not notified of such sales within twelve (12) Months following the Month in which such Direct Sale Proceeds were received. (ii) At any time while the dollar balance of either the Non-Service Area Sales Ledger or the Fully Disqualified Sales Ledger is greater than zero and subject to Section 7.3(c)(iv): (A) (B) (C) Buyer will exercise Commercially Reasonable Efforts to utilize the proceeds represented by the dollar balances of such ledgers to purchase Gas for resale in a Qualified Sale. In no event shall Buyer be obligated to purchase Gas that will be remarketed at a price that is less than the Minimum Remarketing Sales Price for such Gas. To the extent of any Direct Sale Proceeds received by a Project Participant, Buyer shall cause such Project Participant to exercise Commercially Reasonable Efforts to utilize an amount at least equal to such Direct Sale Proceeds to purchase Gas or electricity that will be used for a Qualifying Use that is not a Private Business Use. Seller will exercise Commercially Reasonable Efforts to cause Buyer to purchase Gas for a price up to the aggregate amount of such dollar balances and to sell such Gas in Qualified Sales. If Seller locates such a remarketing opportunity, then (w) Seller will notify Buyer, (x) Seller will sell to Buyer the Gas to be remarketed at a price determined by Seller in a Commercially Reasonable manner based upon applicable published index prices at the delivery point where such sale will occur (the Remarketing Purchase Price ), (y) Seller will remarket such Gas in a Qualified Sale on Buyer s behalf, and (z) Seller will remit to Buyer the net proceeds collected from such Qualified Sale, but in no event shall Seller remit less than the Minimum Remarketing Sales Price for the remarketing transaction. Seller will issue to Buyer a confirmation notice (including Btus and dollar price) of each purchase of Gas by or on behalf of Buyer, and each sale of Gas on Buyer s behalf, under this clause (C), and amounts due from or to Buyer shall be separately stated on the Billing Statement for the Month in which such transactions for the remarketing transaction occur. In no event shall Seller be required to sell Gas to Buyer for remarketing if the price for which such Gas is to be remarketed is 22

172 less than the Minimum Remarketing Sales Price for such transaction. With respect to any Gas to be remarketed in any transaction under this clause (C), the Minimum Remarketing Sales Price is an amount determined by the following formula: MRSP = RPP (RPP x (RRA/CLB)) Where: MRSP = Minimum Remarketing Sales Price for one MMBtu of Gas RPP = Remarketing Purchase Price for one MMBtu of Gas RRA = The balance of the Remarketing Reserve Account CLB = The combined cash balance of the Non-Service Area Sales Ledger and the Fully Disqualified Sales Ledger (iii) Unless the terms of a remarketing sale undertaken by Seller on Buyer s behalf are specifically assumed by Buyer, Seller shall be responsible to Buyer for any costs or liabilities associated with such remarketing sale (other than costs related to the price at which such Gas is sold and the risk of collecting the sale proceeds from the remarketing buyer), including, without limitation, any cover or replacement costs; termination payments; fees, penalties, costs or charges (in cash or in kind) assessed by any transporter for failure to satisfy its balance or nomination requirements; Claims for breach of warranty; taxes, fees, levies, penalties, licenses or charges imposed by any Government Agency; and Claims from personal injury or property damages. (iv) The relevant Project Participant, if it has received Direct Sale Proceeds, and otherwise Buyer, will have the exclusive right to purchase Gas in accordance with Section 7.3(c)(ii) in amounts equal to Direct Sale Proceeds for the first twelve (12) Months following the Month in which such Direct Sale Proceeds were received, and Seller will have no right to effect such purchases and sales in respect of such Direct Sale Proceeds during such period, provided that the foregoing twelve (12) Month exclusivity right shall not apply if Buyer or the relevant Project Participant, as applicable, waives its rights under this clause (iv) in a written notice to Seller. If (A) the Monthly Index Price for any Gas sold by Buyer or a Project Participant (other than pursuant to a remarketing by Seller under this Article VII) in a Non-Service Area Sale or a Fully Disqualified Sale exceeds the Direct Sale Proceeds received in such sale, and (B) Buyer or the Project Participant, as applicable, is unable to use an amount corresponding to all or a portion of such Direct Sale Proceeds in accordance with this Section 7.3(c)(iv) within the first twelve (12) Months following the Month in which such Direct Sale Proceeds were received, then Buyer shall (or shall cause the Project Participant to) deposit into the Remarketing Reserve Account an amount equal to the allocable portion of the excess described in clause (A) related to such unused Direct Sale Proceeds. Following the twelve (12) Month exclusivity period, Seller shall have the non-exclusive right to make 23

173 purchases and sales on behalf of Buyer pursuant to Section 7.3(c)(ii)(C), above, in respect of such unused Direct Sale Proceeds of Buyer, and Buyer shall give Seller at least ten (10) days notice of any proposed remarketing sale by Buyer. (v) The total purchase price of any such Gas or electricity purchased by Buyer or a Project Participant pursuant to Section 7.3(c)(ii) of this Agreement and all Related Prepaid Contracts will be entered as a dollar debit on (A) the Fully Disqualified Sales Ledger, if and to the extent such ledger has a positive balance and such Gas or electricity is remarketed in a Qualified Sale and (B) on the Non-Service Area Sales Ledger, if and to the extent such ledger has a positive balance, the Fully Disqualified Sales Ledger has a zero balance, and such Gas or electricity is remarketed in a Qualified Sale, with such debit in the case of (A) or (B) dated as of the last day of the Month in which such Gas was purchased. Each dollar debit shall off-set and reverse an equal amount of the dollar credits to such ledger (that have not previously been transferred to the Expired Non-Service Area Sales Ledger or the Expired Fully Disqualified Sales Ledger) in the order in which they were made (beginning with the oldest credit not previously off-set and reversed by any prior debit). Whenever a debit is made to the dollar balance of either such ledger, Seller shall also debit the Gas balance of such ledger and off-set and reverse the Gas credit that was made to such ledger in conjunction with the dollar credit off-set and reversed by such dollar debit, and in a proportional amount. For the avoidance of doubt, neither the Non-Service Area Sales Ledger nor the Fully Disqualified Sales Ledger shall ever have a negative balance, and the same purchase transaction shall not result in a debit to more than one ledger except to the extent that a credit for the transaction causes one ledger to have a zero balance and the remaining portion of the permitted credit is made to the other ledger. (vi) Seller shall also maintain an Expired Non-Service Area Sales Ledger and an Expired Fully Disqualified Sales Ledger. Whenever a dollar credit to the Non-Service Area Sales Ledger has not been reversed in full within two years of such credit by an off-setting dollar debit in accordance with Section 7.3(c)(v), then the remaining portion of such dollar credit and the remaining portions of the contemporaneous and corresponding Gas credit to such ledger shall be transferred to the Expired Non-Service Area Sales Ledger. Whenever a dollar credit to the Fully Disqualified Sales Ledger has not been reversed in full within two years of such credit by an off-setting dollar debit in accordance with Section 7.3(c)(v), then the remaining portion of such dollar credit and the remaining portion of the contemporaneous and corresponding Gas credit to such ledger shall be transferred to the Expired Fully Disqualified Sales Ledger. Pursuant to Section 18.2(b), upon any redemption of Bonds in accordance with Section 4.01 of the Bond Indenture, the dollar credits made to either the Expired Fully Disqualified Sales Ledger or the Expired Non-Service Area Sales Ledger shall be reduced (in the order of entry) by an aggregate amount corresponding to the principal amount of Bonds so redeemed, and the Gas credits to such ledgers shall be reduced by the contemporaneous Gas credits corresponding to the dollar credits so reduced. (vii) No later than the tenth (10 th ) day of each Month, Seller shall provide to Buyer copies of the Non-Service Area Sales Ledger, the Fully Disqualified 24

174 Sales Ledger, the Expired Non-Service Area Sales Ledger and the Expired Fully Disqualified Sales Ledger showing all credits and debits to each such ledger since the Execution Date. (d) Remarketing Default (i) A Remarketing Default shall occur if, at any time, either (A) (x) the sum of all Btu credits on the Expired Non-Service Area Sales Ledger and the Expired Fully Disqualified Sales Ledger exceeds (y) the Non-Service Area Remarketing Limit, or (B) (x) the sum of all Btu credits on the Expired Fully Disqualified Sales Ledger exceeds (y) the Fully Disqualified Remarketing Limit. (ii) The occurrence of a Remarketing Default and the remedies associated therewith in Article 17XVII shall be Buyer s sole and exclusive remedies with respect to any inability by Seller to purchase and remarket Gas for Buyer pursuant to, or any breach by Seller of its obligations under, this Section 7.3. (iii) Buyer shall notify Seller promptly following any purchase and sale by it or a Project Participant pursuant to Section 7.3(c)(ii)(A) or (B). Section 7.4 Remarketing Terms. (a) In remarketing any Gas specified in a Remarketing Notice that results in a credit to the Fully Disqualified Sales Ledger, Seller may act directly as principal to the remarketing buyer, or may cause a supplier to Seller to act directly as principal to the remarketing buyer. Neither Seller nor any Person acting on Seller s behalf shall owe any fiduciary duties to Buyer with respect to the remarketing of any Gas. Buyer acknowledges and agrees that Seller or a Person acting on Seller s behalf in remarketing Gas may have other supplies of Gas available to sell to potential remarketing buyers, and Gas designated for remarketing shall not be entitled to any preference over any such other supplies of Gas. (b) Proceeds from Sales to Municipal Entities. (i) For any Gas specified in a Monthly Remarketing Notice that Seller remarkets in a Qualified Sale or Non-Service Area Sale, Seller shall deliver to Buyer the actual proceeds received with respect to such Gas less the Remarketing Fee, provided that the amount delivered by Seller under this clause (i) shall not be less than the quantity so remarketed multiplied by the Net Participant Price. In the event the payment due date under a Qualified Sale or Non-Service Area Sale has not yet occurred prior to the date upon which payment is due under this Agreement for the applicable Month, the Parties shall nonetheless issue statements as if the full amount from such Qualified Sale or Non- Service Area Sale had been paid and, if such full payment is not received prior to the next monthly due date under this Agreement, the Parties shall issue the appropriate statements to reflect the actual proceeds received and true-up any difference. (ii) For any Gas specified in a Daily Remarketing Notice that Seller remarkets in a Qualified Sale or Non-Service Area Sale, Seller shall deliver to Buyer the 25

175 actual proceeds received with respect to such Gas less the Remarketing Fee (as such Remarketing Fee may be increased pursuant to Section 4.2). (c) Proceeds from Other Sales. (i) For any Gas specified in a Monthly Remarketing Notice that is not remarketed in a Qualified Sale or Non-Service Area Sale, Seller shall pay to Buyer the positive result determined by the following formula with respect to each Delivery Point to which such Monthly Remarketing Notice applied: P = Q x (IP RF) Where: P = The amount payable by Seller under this Section 7.4(c)(i) Q = The quantity of such Gas remarketed with respect to such Delivery Point IP = The Monthly Index Price for such Delivery Point RF = The Remarketing Fee (ii) For any Gas specified in a Daily Remarketing Notice that is not remarketed in a Qualified Sale or Non-Service Area Sale, Seller shall pay to Buyer the positive result determined by the following formula with respect to each Delivery Point to which such Daily Remarketing Notice applied: P = Q x (IPL RF) Where: P = The amount payable by Seller under this Section 7.4(c)(ii) Q = The quantity of such Gas remarketed with respect to such Delivery Point IPL = Either (A) in the case of a deemed Daily Remarketing Notice as specified in Section 4.2, the lower of (x) the Index Price (Low) for the Gas Day following the Gas Day in which Buyer s failure to take Gas occurs and (y) the Monthly Index Price for the applicable Month in which Buyer s failure to take Gas occurs, or (B) in all other cases, the Index Price (Low) for such Delivery Point RF = The Remarketing Fee (as may be increased pursuant to Section 4.2) (d) Any proceeds received by Buyer under this Section 7.4 for Gas remarketed by Seller in sales other than Qualified Sales that exceed the amount Buyer would 26

176 have received for the same quantity of Gas at the Net Participant Price shall be deposited in the Remarketing Reserve Account. (e) Seller shall prepare, maintain and provide monthly to Buyer accurate and complete records showing (i) the identity of each purchaser in a Qualified Sale or Non-Service Area Sale undertaken by Seller on Buyer s behalf, (ii) the aggregate amount of Gas remarketed under this Agreement in Qualified Sales, (iii) the aggregate amount of Gas remarketed under this Agreement in Non-Service Area Sales, and (iv) the aggregate amount of Gas remarketed under this Agreement in Fully Disqualified Sales. (f) Any amounts due to Buyer for Gas remarketed by Seller or purchased by Seller under this Article VII shall be remitted to Buyer pursuant to Section 14.2 in the Month following the Month in which such Gas is remarketed or purchased, as applicable. Section 7.5 Remarketing on Buyer s Behalf. All Gas remarketed by Seller pursuant to this Article VII shall be for the benefit of Buyer in that all such remarketed Gas shall be sold by Seller to Buyer and then resold by or for the account of Buyer pursuant to the terms of this Agreement. ARTICLE VIII REPRESENTATIONS AND WARRANTIES Section 8.1 Representations and Warranties. As a material inducement to entering into this Agreement, each Party, with respect to itself, represented and warranted to the other Party as of the date of the Original Agreement (which representations and warranties are reserved hereby), and hereby represents and warrants to the other Party as of the Execution Date, as follows: (a) it is duly organized and validly existing under the Laws of the state in which it is organized, and has all requisite power and authority, corporate or otherwise, to enter into and to perform its obligations under the Original Agreement or this Agreement, as applicable, and to carry out the terms and conditions hereof and the transactions contemplated hereby; (b) it has all requisite power and authority to conduct its business, to own its properties, if any, and to execute, deliver and perform its obligations under the Original Agreement or this Agreement, as applicable; (c) there is no litigation, action, suit, proceeding or investigation pending or, to the best of such Party s knowledge, threatened against such Party, before or by any Government Agency, which could reasonably be expected to materially and adversely affect the performance by such Party of its obligations under the Original Agreement or this Agreement, as applicable, or that questions the validity, binding effect or enforceability hereof, any action taken or to be taken by such Party pursuant hereto or any of the transactions contemplated hereby; (d) the execution, delivery and performance of the Original Agreement or this Agreement, as applicable, by such Party have been duly authorized by all necessary action on the part of such Party and do not require any approval or consent of any security holder of such Party 27

177 or any holder (or any trustee for any holder) of any indebtedness or other obligation of such Party; (e) the Original Agreement or this Agreement, as applicable, has been duly executed and delivered on behalf of such Party by an appropriate officer or authorized Person of such Party and constitutes the legal, valid and binding obligation of such Party, enforceable against it in accordance with its terms, as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium and similar Laws affecting creditors rights generally and by general principles of equity; (f) the execution, delivery and performance of the Original Agreement or this Agreement, as applicable, by such Party shall not violate any provision of any Law, rule, regulation, ordinance, city charter, order, writ, judgment, decree or other legal or regulatory determination applicable to it; (g) the execution, delivery and performance by such Party of the Original Agreement or this Agreement, as applicable, and the consummation of the transactions contemplated hereby, including the incurrence by such Party of its financial obligations under the Original Agreement or this Agreement, as applicable, shall not result in any violation of any term of any material contract or agreement applicable to it, or any of its charter, organizational laws or documents or regulatory provisions of any license, permit, franchise, judgment, writ, injunction or regulation, decree, order, charter, Law, ordinance, rule or regulation applicable to it or any of its properties or to any obligations incurred by it or by which it or any of its properties or obligations are bound or affected, or of any determination or award of any arbitrator applicable to it, and shall not conflict with, or cause a breach of, or default under, any such term or result in the creation of any lien upon any of its properties or assets (except the lien of the Bond Indenture and the Collateral Agency Agreement); (h) to the best of the knowledge and belief of such Party, no consent, approval, order or authorization of, or registration, declaration or filing with, or giving of notice to, obtaining of any license or permit from, or taking of any other action with respect to, any Government Agency is required in connection with the valid authorization, execution, delivery and performance by such Party of the Original Agreement or this Agreement, as applicable, or the consummation of any of the transactions contemplated hereby; and (i) it enters the Original Agreement or this Agreement, as applicable, as a bona-fide, arms-length transaction involving the mutual exchange of consideration and, once executed by both Parties, considers the Original Agreement or this Agreement, as applicable, a legally enforceable contract. Section 8.2 Additional Representations and Warranties of Buyer. As a material inducement to entering into thisthe Original Agreement, Buyer hereby representsrepresented and warrantswarranted to Seller as of the Execution date thereof as follows: (a) Buyer is entering into thisthe Original Agreement for the purpose of acquiring Gas for sale to the Project Participants pursuant to the Gas Supply Contract, subject to remarketing provisions; and 28

178 (b) any amounts payable by Buyer under thisthe Original Agreement shall (i) other than the Prepayment and net losses incurred by Buyer as a result of remarketing, be payable as an item of Operating Expense under (and as defined in) the Bond Indenture, and (ii) not constitute an indebtedness or liability of Buyer within the meaning of any constitutional or statutory limitation or restriction applicable to Buyer. As a material inducement to entering into this Agreement, Buyer hereby makes the representation and warranty in paragraph (b) of this Section 8.2 to Seller with respect to this Agreement. Section 8.3 Expiration of Representations and Warranties. No claim may be made by either Party based on the representations and warranties given in Sections 8.1 or 8.2 unless such claim is asserted prior to the expiration or termination of this Agreement, unless such expiration or termination was caused by an incorrect representation or warranty in Sections 8.1 or 8.2 in which case such claim may be made within one hundred eighty (180) days after such expiration or termination of this Agreement. Section 8.4 Warranty of Title. Seller warranted in the Original Agreement (which warranty is preserved hereby) and hereby warrants that it will have the right to convey and will transfer good and merchantable title to all Gas sold under the Original Agreement or this Agreement, as applicable, and delivered by it to Buyer, free and clear of all liens, encumbrances, and claims. EXCEPT FOR THE WARRANTIES EXPRESSLY MADE BY SELLER IN THIS ARTICLE VIII, SELLER HEREBY DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR ANY PARTICULAR PURPOSE. ARTICLE IX TAXES Seller shall (i) be responsible for all ad valorem, excise, severance, production and other taxes assessed with respect to the Gas delivered under this Agreement upstream of the Delivery Points, and (ii) reimburse Buyer and its Affiliates for any such taxes paid by Buyer or its Affiliates. Buyer shall (i) be responsible for all such taxes assessed at or downstream of the Delivery Points, and (ii) reimburse Seller and its Affiliates for any such taxes paid by Seller or its Affiliates. ARTICLE X JURISDICTION ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST EITHER PARTY ARISING OUT OF OR RELATING HERETO SHALL BE BROUGHT EXCLUSIVELY IN THE COURTS OF THE STATE OF CALIFORNIA OR OF THE UNITED STATES OF AMERICA, IN EITHER CASE, LOCATED IN LOS ANGELES COUNTY CALIFORNIA. BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH PARTY, FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, IRREVOCABLY ACCEPTS GENERALLY AND UNCONDITIONALLY THE EXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS; WAIVES ANY DEFENSE OF FORUM NON CONVENIENS; AGREES THAT 29

179 SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THE PARTY AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH ARTICLE XVI; AGREES THAT SERVICE AS PROVIDED ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER THE PARTY IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT. ARTICLE XI FORCE MAJEURE Section 11.1 Applicability of Force Majeure. Except with regard to a Party s obligation to make payment(s) under this Agreement, neither Party shall be liable to the other for failure to perform an obligation, to the extent such failure was caused by Force Majeure. The term Force Majeure as employed herein means any cause not reasonably within the control of the Party (or, in the case of Buyer, its Nominating Agent) claiming suspension, as further defined in Section 11.2(a). Section 11.2 Force Majeure Defined. (a) Force Majeure shall include, but not be limited to, the following: (i) physical events such as acts of God, landslides, lightning, earthquakes, fires, storms or storm warnings, such as hurricanes, which result in evacuation of the affected area, floods, washouts, explosions, breakage or accident or necessity of repairs to machinery or equipment or lines of pipe; (ii) weather related events affecting an entire geographic region, such as low temperatures which cause freezing or failure of wells or lines of pipe; (iii) interruption and/or curtailment of transportation and/or storage by Transporters (provided that if the affected Party is using interruptible or secondary Firm transportation, only if primary, in-path, Firm transportation is also curtailed by the same event, or if the relevant Transporter does not curtail based on path, if primary Firm transportation is also curtailed); (iv) acts of others such as strikes, lockouts or other industrial disturbances, riots, sabotage, insurrections, wars or acts of terror; (v) governmental actions such as necessity for compliance with any court order, Law, statute, ordinance, regulation, or policy having the effect of Law promulgated by a Government Agency having jurisdiction; and (vi) an event affecting a supplier delivering Gas to Seller to the extent (A) such Gas was intended for redelivery to Buyer under this Agreement, and (B) such event would be considered Force Majeure under this Agreement if it affected Seller directly. In addition, with respect to any Revised Delivery Point, Seller s obligation to deliver to a Revised Delivery Point will be excused by force majeure affecting its supplier to such Revised Delivery Point under the actual terms of the agreement between Seller and such supplier; provided that Seller will exercise Commercially Reasonable Efforts to cause such agreement to include force majeure terms that are no less favorable to Seller than the Force Majeure terms in this Agreement. (b) Seller and Buyer shall make Commercially Reasonable Efforts to avoid the adverse impacts of a Force Majeure and to resolve the event or occurrence once it has occurred in order to resume performance. 30

180 Section 11.3 Force Majeure Exclusions. Neither Party shall be entitled to the benefit of the provisions of Force Majeure to the extent performance is affected by any or all of the following circumstances: (i) the curtailment of interruptible or secondary Firm transportation unless either (A) primary, in-path, Firm transportation is also curtailed by the same event, or (B) if the relevant Transporter does not curtail based on path, primary Firm transportation is also curtailed; (ii) the Party claiming excuse failed to remedy the condition and to resume the performance of such covenants or obligations with reasonable dispatch; (iii) economic hardship, to include, without limitation, Seller s ability to sell Gas at a higher or more advantageous price, Buyer s ability to purchase Gas at a lower or more advantageous price, or a Government Agency disallowing, in whole or in part, the pass through of costs resulting from this Agreement; (iv) the loss of Buyer s market(s) or Buyer s inability to use or resell Gas purchased hereunder, except, in either case, as provided in Section 11.2; or (v) the loss or failure of Seller s Gas supply or depletion of reserves, except, in either case, as provided in Section Buyer shall not be entitled to the benefit of the provisions of Force Majeure to the extent performance is affected by any action taken by Buyer in its governmental capacity. The Party claiming Force Majeure shall not be excused from its responsibility for Imbalance Charges. Section 11.4 Settlement of Labor Disputes. Notwithstanding anything to the contrary herein, the Parties agree that the settlement of strikes, lockouts or other industrial disturbances shall be within the sole discretion of the Party experiencing such disturbance. Section 11.5 Force Majeure Procedure. The Party whose performance is prevented by Force Majeure must provide or cause to be provided notice to the other Party and, with respect to Seller as the notifying Party, the Nominating Agent. Initial notice may be given orally; however, written notice with reasonably full particulars of the event or occurrence is required as soon as reasonably possible. Upon providing written notice of Force Majeure to the other Party, the affected Party will be relieved of its obligation, from the onset of the Force Majeure, to make or accept delivery of Gas, as applicable, to the extent and for the duration of Force Majeure, and neither Party shall be deemed to have failed in such obligations to the other during such occurrence or event. ARTICLE XII COMPLIANCE WITH LAWS This Agreement shall be subject to all present and future Laws of any Government Agency having jurisdiction, and neither Party has or will knowingly undertake or knowingly cause to be undertaken any activity that would conflict with such Laws; provided, however, that nothing herein shall be construed to restrict or limit either Party s right to object to or contest any such Law, or its application to this Agreement or the transactions undertaken hereunder, and neither acquiescence therein or compliance therewith for any period of time shall be construed as a waiver of such right. ARTICLE XIII ASSIGNMENT Neither Party shall assign this Agreement or any of its rights or obligations under this Agreement without the prior written consent of the other Party; provided, however, that (ia) 31

181 pursuant to the Bond Indenture, Buyer may, without the consent of Seller, transfer, sell, pledge, encumber or assign this Agreement in connection with any financing or other financial arrangements, and (iib) upon written notice to Buyer, Seller may, without Buyer s consent, assign the Transaction Documentsthis Agreement to an Affiliate of Seller, which assignment shall constitute a novation ifprovided that (i) the Seller s Guaranty continues to apply to the obligation of such assignee hereunder or (ii) the assignee provides to Buyer a Seller s Guaranty, a Rating Confirmation (as defined in the Bond Indenture), and a written opinion of such assignee s counsel confirming the enforceability of the Seller s Guaranty, which assignment shall constitute a novation. Section 14.1 Monthly Statements. ARTICLE XIV PAYMENTS (a) No later than the 5 th day of each Month during the Delivery Period (excluding the first Month of the Delivery Period) and the first Month following the end of the Delivery Period, Buyer shall deliver to Seller a statement (a Buyer s Statement ) listing (i) for each purchase of Replacement Gas, the quantity and replacement price applicable to such purchase, (ii) any other amounts due to Buyer in connection with this Agreement with respect to the prior Month(s), and (iii) for each Project Participant, any Direct Sale Proceeds and the Btus attributable to any dollar credits. (b) No later than the 10 th day of each Month during the Delivery Period (excluding the first Month of the Delivery Period) and the first Month following the end of the Delivery Period (the Billing Date ), Seller shall deliver a statement (a Billing Statement ) to Buyer indicating (i) the total amount due to Buyer, if any, under Articles IV, V and VII with respect to the prior Month(s), (ii) the total amount due to Seller with respect to Increased Costs for the prior Month(s), (iii) any other amounts due to Seller in connection with this Agreement with respect to the prior Month(s), and (iv) the net amount due to Buyer or Seller. If the actual quantity delivered is not known by the Billing Date, Seller may provisionally prepare a Billing Statement based on Seller s best available knowledge of the quantity of Gas delivered. The invoiced quantity and amounts paid thereon (with interest calculated on the amount overpaid or underpaid by Buyer at the Default Rate) will then be adjusted on the following Month s Billing Statement as actual delivery information becomes available based on the actual quantity delivered. (c) Upon request by either Party, the other Party will deliver or cause to be delivered such supporting documentation of the foregoing as such requesting Party may reasonably request. Section 14.2 Payment. (a) If the Billing Statement indicates an amount due from Buyer, then Buyer shall remit such amount to Seller by wire transfer (pursuant to Seller s instructions), in immediately available funds, on or before the later of (i) the twenty-fifth (25 th ) day of the Month following the most recent Month to which such Billing Statement relates, or (ii) the tenth (10th) 32

182 day following Buyer s receipt of Seller s Billing Statement, or if either such day is not a Business Day, the following Business Day. If the Billing Statement indicates an amount due from Seller, then Seller shall remit such amount to Buyer by wire transfer (pursuant to Buyer s instructions), in immediately available funds, on or before the later of (i) the twenty-third (23 rd ) day of the Month following the most recent Month to which such Billing Statement relates, or (ii) the tenth (10th) day following Seller s receipt of Buyer s Statement, or if either such day is not a Business Day, the preceding Business Day. (b) If Buyer fails to issue a Buyer s Statement with respect to any Month, Seller shall not be required to estimate or credit any amounts due to Buyer for such Month, provided that Buyer may include any such amount on subsequent Buyer s Statements issued within the next sixty (60) days. Section 14.3 Payment of Disputed Amounts. If Seller disputes any amounts included in the Buyer s Statement, Seller shall (except in the case of manifest error) nonetheless calculate the Billing Statement based on the amounts included in Buyer s Statement. If Buyer disputes any amounts included in the Billing Statement, Buyer shall (except in the case of manifest error) nonetheless pay any amount required by the Billing Statement provided. In either case, the disputing Party shall have the right to dispute any amounts included in a Buyer s Statement or Billing Statement, as applicable, or otherwise used to calculate payments due under this Agreement pursuant to Section Section 14.4 Late Payment. If a Party owing a net payment under Section 14.2 fails to remit the full amount payable when due, interest on the unpaid portion shall accrue from the date due until the date of payment at the Default Rate. Section 14.5 Audit; Adjustments. (a) A Party shall have the right, at its own expense, upon reasonable notice and at reasonable times, to examine and audit and to obtain copies of the relevant portion of the books, records, and telephone recordings of the other Party only to the extent reasonably necessary to verify the accuracy of any statement, charge, payment, or computation made under this Agreement. This right to examine, audit, and to obtain copies shall not be available with respect to proprietary information not directly relevant to transactions under this Agreement. (b) Each Buyer s Statement and Billing Statement shall be conclusively presumed final and accurate and all associated claims for underpayments or overpayments shall be deemed waived unless such Buyer s Statement or Billing Statement is objected to in writing, with adequate explanation and/or documentation, within two years after the Month in which such Buyer s Statement or Billing Statement was issued. (c) All retroactive adjustments shall be paid in full by the Party owing payment within thirty (30) days of notice and substantiation of such inaccuracy. If the Parties are unable to agree upon any retroactive adjustments requested by either Party within the time period specified in subsection (b) above, then either Party may pursue any remedies available with respect to such adjustments at law or equity. Retroactive adjustments for payments made based on incorrect Buyer s Statements or Billing Statements shall bear interest at the Default 33

183 Rate from the date such payment was made. Buyer shall cause each Project Participant to comply with the provisions of Section 14.5(a) to the extent necessary to allow Seller to verify any amounts due under this Agreement. Section 14.6 Netting. The Parties shall net all amounts due and owing, and/or past due, arising under this Agreement such that the Party owing the greater amount shall make a single payment of the net amount to the other Party in accordance with this Article XIV. Notwithstanding the foregoing, Seller shall not be entitled to net any payments due to Seller against (i) the Termination Payment if it becomes due, or (ii) any payments due from Seller pursuant to Article IV or Article VII. ARTICLE XV [RESERVED] ARTICLE XVI NOTICES Any notice, demand, or request required or authorized by this Agreement to be given by one Party (or the Nominating Agent under relevant sections of this Agreement) to another Party or the Nominating Agent shall be in writing. It shall either be sent by facsimile (with receipt confirmed by telephone and electronic transmittal receipt), courier, or personally delivered (including overnight delivery service) to the representative of the other Party designated in Exhibit B, or with respect to a notice given to a Nominating Agent, in Exhibit E. Any such notice, demand, or request shall be deemed to be given (i) when sent by facsimile confirmed by telephone and electronic transmittal receipt, or (ii) when actually received if delivered by courier or personal delivery (including overnight delivery service). Either Party may change its notice information in Exhibit B (or Buyer may change the notice information for the Nominating Agent in Exhibit E) upon 10 days prior written notice to the other Party. In addition to the foregoing, the Parties may agree in writing at any time to deliver notices, demands or requests through alternate methods, such as electronic mail. ARTICLE XVII DEFAULT; REMEDIES; TERMINATION Section 17.1 Seller Default. Each of the following events shall constitute a Seller Default under this Agreement: (a) Seller or Seller s Guarantor shall fail to pay when due any amounts owed to Buyer pursuant to this Agreement and such failure shall continue for one (1) Business Day after receipt by Seller of notice thereof; (b) Seller or Seller s Guarantor (i) is dissolved (other than pursuant to a consolidation, amalgamation or merger); (ii) becomes insolvent or is unable to pay its debts or fails or admits in writing its inability generally to pay its debts as they become due; (iii) makes a general assignment, arrangement or composition with or for the benefit of its creditors; (iv) institutes or has instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affecting creditors rights, or a petition is presented for its winding-up or liquidation, and, in the 34

184 case of any such proceeding or petition instituted or presented against it, such proceeding or petition (A) results in a judgment of insolvency or bankruptcy or the entry of an order for relief or the making of an order for its winding-up or liquidation or (B) is not dismissed, discharged, stayed or restrained in each case within thirty (30) days of the institution or presentation thereof; (v) has a resolution passed for its winding-up, official management or liquidation (other than pursuant to a consolidation, amalgamation or merger); (vi) seeks or becomes subject to the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official for it or for all or substantially all its assets; (vii) has a secured party take possession of all or substantially all its assets or has a distress, execution, attachment, sequestration or other legal process levied, enforced or sued on or against all or substantially all its assets and such secured party maintains possession, or any such process is not dismissed, discharged, stayed or restrained, in each case within thirty (30) days thereafter; (viii) causes or is subject to any event with respect to it which, under the applicable laws of any jurisdiction, has an analogous effect to any of the events specified in clauses (i) to (vii) (inclusive); or (ix) takes any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the foregoing acts; (c) any representation or warranty made by Seller in this Agreement shall prove to have been incorrect in any material respect when made; or (d) Seller s Guaranty ceases to be in full force and effect or is declared to be null and void, or Seller s Guarantor contests the validity or enforceability of the Seller s Guaranty;. (e) the failure of Seller s Guarantor to have a Credit Rating of BBB- or higher by S&P or Baa3 or higher by Moody s, unless, within five (5) Business Days after Buyer s demand related thereto, Seller provides Alternative Credit Support in accordance with the provisions of Exhibit D hereto; or (f) if Seller has provided Alternative Credit Support to Buyer in accordance with Exhibit D, any of the following events: (i) the provisions of Exhibit D cease to be in full force and effect or are declared to be null and void; (ii) Seller or any credit support party contests the validity or enforceability of the provisions of Exhibit D; or (iii) with respect to any Cash or Other Collateral provided as Alternative Credit Support under Exhibit D, Buyer ceases to have a first priority perfected security interest. Section 17.2 Buyer Default. Each of the following events shall constitute a Buyer Default under this Agreement: (a) Buyer shall fail to pay when due any amounts owed to Seller pursuant to this Agreement and such failure shall continue for five (5) Business Days after receipt by Buyer of notice thereof; 35

185 (b) Buyer (i) is dissolved (other than pursuant to a consolidation, amalgamation or merger); (ii) becomes insolvent or is unable to pay its debts or fails or admits in writing its inability generally to pay its debts as they become due; (iii) makes a general assignment, arrangement or composition with or for the benefit of its creditors; (iv) institutes or has instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affecting creditors rights, or a petition is presented for its winding-up or liquidation, and, in the case of any such proceeding or petition instituted or presented against it, such proceeding or petition (A) results in a judgment of insolvency or bankruptcy or the entry of an order for relief or the making of an order for its winding-up or liquidation or (B) is not dismissed, discharged, stayed or restrained in each case within thirty (30) days of the institution or presentation thereof; (v) has a resolution passed for its winding-up, official management or liquidation (other than pursuant to a consolidation, amalgamation or merger); (vi) seeks or becomes subject to the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official for it or for all or substantially all its assets; (vii) has a secured party take possession of all or substantially all its assets or has a distress, execution, attachment, sequestration or other legal process levied, enforced or sued on or against all or substantially all its assets and such secured party maintains possession, or any such process is not dismissed, discharged, stayed or restrained, in each case within thirty (30) days thereafter; (viii) causes or is subject to any event with respect to it which, under the applicable laws of any jurisdiction, has an analogous effect to any of the events specified in clauses (i) to (vii) (inclusive); or (ix) takes any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the foregoing acts; or (c) any representation or warranty made by Buyer in this Agreement shall prove to have been incorrect in any material respect when made.; or (d) Buyer shall fail to pay when due any amounts owed to the Swap Counterparty pursuant to the Buyer Swap notwithstanding any cure periods thereunder. Section 17.3 Non-Default Termination Events. (a) Each of the following events shall constitute a Seller Non-Default Termination Event under this Agreement: (i) any interpretation, enactment or change or amendment to any Governmental Approval or Law occurring after the Execution Date that results or would result in the performance of any obligation of Seller to deliver Gas or Buyer to receive Gas under this Agreement being prohibited or unlawful; (ii) both (A) ansubject to Section 17.4(e) and 17.5(d) below, the occurrence of a Swap Early Termination Date (as defined inunder the Seller Swap) is designated based on either (i) the designation of such date by either party pursuant to the terms of the Seller Swap or occurs(ii) automatically pursuant to the terms of the Seller Swap, and (B) either the Seller Swap or the Buyer Swap is not replaced within the 45-day period specified in Section 17.5; 36

186 (iii) both (A) ansubject to Section 17.5(d) below, the occurrence of a Swap Early Termination Date under the Buyer Swap either (i) based on the designation of such date by the Swap Counterparty pursuant to the terms of such Buyer Swap, or (ii) automatically as a result of an Event of Default (as defined in the Buyer Swap) is designated by Swap Counterparty pursuant to the terms of the Buyer Swap or occurs automatically pursuant to the terms of the Buyer Swap based on an Event of Default where Buyer is the Defaulting Partyby Buyer or a Termination Event where(as defined in the Buyer Swap) where Buyer is the solean Affected Party (as each term is defined therein), and (B) either the Seller Swap orin the Buyer Swap is not replaced within the 45- day period specified in Section 17.5) thereunder; or (iv) an Early Termination Date (as defined under the Interest Rate Swap) is designated by Seller under the Interest Rate Swap pursuant to the terms of such Interest Rate Swap. (b) Each of the following events shall constitute a Buyer Non-Default Termination Event under this Agreement: (i) any interpretation, enactment or change or amendment to any Governmental Approval or Law occurring after the Execution Date that results or would result in the performance of any obligation of Seller to deliver Gas or Buyer to receive Gas under this Agreement being prohibited or unlawful; (ii) both (A) ansubject to Section 17.4(e) and 17.5(d) below, the occurrence of a Swap Early Termination Date under the Buyer Swap based on either (A) the designation of such date by Buyer pursuant to the terms of such Buyer Swap, or (B) automatically as a result of an Event of Default (as defined in the Buyer Swap) is designated by the Buyer pursuant to the terms of theby the Swap Counterparty or a Termination Event (as defined in the Buyer Swap or occurs automatically pursuant to the terms of the Buyer Swap based on an Event of Default) where the Swap Counterparty is the Defaulting Party or a Termination Event where the Swap Counterparty is the solean Affected Party (as each term is defined therein), and (B) either the Seller Swap orin the Buyer Swap is not replaced within the 45-day period specified in Section 17.5) thereunder; (iii) both (A) ansubject to Section 17.5(d) below, the occurrence of a Swap Early Termination Date (as defined inunder the Seller Swap) is designated based on either (i) the designation of such date by the Swap Counterparty pursuant to the terms of thesuch Seller Swap based on, or (ii) automatically as a result of an Event of Default where(as defined in the Seller is the Defaulting PartySwap) by Seller or a Termination Event (as defined in the Seller Swap) where Seller is the solean Affected Party (as each term is defined therein), and (B) either suchin the Seller Swap or the Buyer Swap is not replaced within the 45-day period specified in Section 17.5) thereunder; (iv) the occurrence of a Persistent Delivery Failure; 37

187 (v) the occurrence of a Remarketing Default, unless Buyer and Seller have taken the action described in Section 18.2(b) within forty-five (45) days after such Remarketing Default; (vi) an Early Termination Date (as defined under the Interest Rate Swap) is designated by Buyer under the Interest Rate Swap pursuant to the terms of such Interest Rate Swap based on an Event of Default where Seller is the Defaulting Party or a Termination Event where Seller is the sole Affected Party (as each term is defined therein); (vii) an Early Termination Date (as defined under the Interest Rate Swap) is designated by Buyer under the Interest Rate Swap pursuant to the terms of such Interest Rate Swap for any reason other than as specified in clause (vi) above; or (viii) both (A) ansubject to Section 17.5(d) below, the occurrence of a Swap Early Termination Date is designated pursuant to the terms ofunder the Seller Swap for any reason other than as specified in clause (iii) above, and (B) either such Seller Swap or the Buyer Swap is not replaced within the 45-day period specified in Section 17.5.; (ix) both (A) Seller has received a Call Receivables Offer (as defined in the RPA) pursuant to Section 4.1(a) of the RPA and (B) Seller has not purchased or is deemed not to have purchased Call Identified Receivables (as defined in the RPA) from the Indenture Trustee within the timeline set forth in Section 4.1(b) of the RPA; or (x) Seller fails to pay any amount due under the RPA or the Investment Agreement promptly following Seller s receipt of written notice of such failure from Buyer or the Indenture Trustee. (c) The following shall constitute a Swap Counterparty Insolvency Event under this Agreement: the occurrence of a Swap Early Termination Date under either the Buyer Swap or the Seller Swap automatically as a result of an Event of Default (as defined in either the Buyer Swap or Seller Swap, as applicable) where the Swap Counterparty is the Defaulting Party (as defined therein) pursuant to Section 5(a)(vii) thereof. Section 17.4 Remedies and Termination. (a) If at any time a Seller Default has occurred and is continuing, Buyer may, by notice to Seller specifying the relevant Seller Default, designate a day not earlier than the day such notice is deemed given under Article XVI as the Early Termination Date; provided, however, that an Early Termination Date shall occur immediately upon the occurrence of a Seller Default occurring under Section 17.1(b)(i), (iii), (v), (vi) or, to the extent analogous thereto, (viii), and as of the time immediately preceding the institution of the relevant proceeding or the presentation of the relevant petition upon the occurrence with respect to such party of a Seller Default specified in Section 17.1(b)(iv) or, to the extent analogous thereto, (viii). (b) If at any time a Buyer Default has occurred and is continuing, Seller may, by notice to Buyer specifying the relevant Buyer Default, designate an Early Termination Date 38

188 not earlier than the day such notice is deemed given.; provided, however, that to designate an Early Termination Date with respect to a Buyer Default under Section 17.2(d), Seller shall first conditionally designate an Early Termination Date no earlier than the forty-fifth (45 th ) day after notice of Buyer s payment default was provided by the Swap Counterparty pursuant to the terms of the Buyer Swap, and if, as of such conditional Early Termination Date, Buyer has not cured its payment default pursuant to the terms of the Buyer Swap, then the conditional Early Termination Date shall be deemed a designated Early Termination Date and shall then be effective without notice or further action of any kind. (c) Except as provided in Section 17.4(j) below, if at any time a Seller Non- DefaultNon-Default Termination Event has occurred and is continuing, Seller may, by notice to Buyer specifying the relevant Seller Non-Default Termination Event, designate an Early Termination Date not earlier than the day such notice is deemed given; provided, however, that: (i) to designate an Early Termination Date with respect to a Swap Early Termination Date described in Section 17.3(a)(ii) or (iii), Seller shall first designate a conditional Early Termination Date no earlier than the end of the resulting Swap Replacement Period, and if, as of such conditional with respect to a Seller Non-Default Termination Event under Section 17.3(a)(iii) resulting from termination of a Buyer Swap pursuant to Section 5(a)(iv), 5(a)(viii), 5(b)(i), 5(b)(ii), 5(b)(iii) or 5(b)(iv) thereof, the Early Termination Date shall occur automatically at the end of the 45-day replacement period described in Section 17.5 if the Buyer Swap and Seller Swap are not replaced within such period; (ii) at any time after the commencement of any 45-day replacement period pursuant to Section 17.5, Seller may conditionally designate an Early Termination Date pursuant to Section 17.3(a)(ii) or (iii), with such designation being conditioned upon (A) the termination and failure to replace, either the Seller Swap or Buyer Swap (as applicable) and (B) thehas not been replaced, then such Early Termination Date occurring no earlier than the end of such 45- day replacement period; andshall be deemed a designated Early Termination Date and shall then be effective without notice or further action of any kind. (iii) an Early Termination Date shall occur automatically upon the occurrence of a Seller Non-Default Termination Event under Section 17.3(a)(iv) resulting from termination of the Interest Rate Swap by Seller pursuant to Section 5(b)(i) of the Interest Rate Swap. (d) Except as provided in Section 17.4(j) below, if at any time a Buyer Non- DefaultNon-Default Termination Event has occurred and is continuing, Buyer may, by notice to Seller specifying the relevant Buyer Non-Default Termination Event, designate an Early Termination Date not earlier than the day such notice is deemed given; provided, however, that: (i) to designate an Early Termination Date with respect to a Buyer Non-DefaultSwap Early Termination Event underdate described in Section 17.3(b)(viii) resulting from termination of a Seller Swap by Seller pursuant to Section 5(a)(iv), 5(a)(viii), 5(b)(i), 5(b)(ii), 5(b)(iii) or 5(b)(iv) thereof, the ii), (iii), (viii) (unless resulting from a Swap Counterparty Insolvency Event) or (ix), Buyer shall first designate a 39

189 conditional Early Termination Date no earlier than the end of the resulting Swap Replacement Period, and if, as of such conditional Early Termination Date, either the Seller Swap or Buyer Swap (as applicable) has not been replaced, then such Early Termination Date shall occur automatically at the end of the 45-day replacement period described in Section 17.5 if the Buyer Swap and Seller Swap are not replaced within such period;be deemed a designated Early Termination Date and shall then be effective without notice or further action of any kind; and (ii) at any time after the commencement of any 45-day replacement period pursuant to Section 17.5, Buyer may conditionally designate an Early Termination Date pursuant to Section 17.3(b)(ii), (iii) or (viii), with such designation being conditioned upon (i) the termination and failure to replace the Seller Swap or Buyer Swap (as applicable) and (ii) the Early Termination Date occurring no earlier than the end of such 45-day replacement period; (ii) (iii) Buyer may not issue a termination notice under this subsection (d) with respect to a Buyer Non-Default Termination Event under Section 17.3(b)(iv) as a result of a Persistent Delivery Failure unless (i) Buyer notifies Seller that the potential Persistent Delivery Failure has occurred within fifteen (15) days after the incurrence of the last Shortfall Quantity used to determine that such a Persistent Delivery Failure occurred, and (ii) Buyer delivers the termination notice under this subsection (d) within ninety (90) days after the incurrence of the last Shortfall Quantity used to determine that such a Persistent Delivery Failure occurred; and (iv) an Early Termination Date shall occur automatically upon the occurrence of a Buyer Non-Default Termination Event under Section 17.3(b)(vi) resulting from termination of the Interest Rate Swap by Buyer pursuant to Section 5(b)(i) of the Interest Rate Swap. (d) If at any time a Swap Counterparty Insolvency Event has occurred and is continuing, then, notwithstanding any other provision herein to the contrary, Seller may, by written notice to Buyer and the Indenture Trustee delivered by the later of (i) one Business Day after the commencement of the Swap Counterparty Insolvency Event and (ii) the end of the Swap Replacement Period, elect to extend the Swap Replacement Period to a period of up to 45 days in the aggregate if Seller agrees to pay all amounts that would otherwise have become due from the Swap Counterparty in the ordinary course under the Buyer Swap during such extended Swap Replacement Period. For the avoidance of doubt, Seller will not be responsible for any amounts that became due from the Swap Counterparty under the Buyer Swap before such extension commenced. (e) As of the Early Termination Date, (i) the Delivery Period will end, (ii) the obligation of Seller to make any further deliveries of Gas to Buyer under this Agreement will terminate, and (iii) the obligation of Buyer to receive deliveries of Gas from Seller under this Agreement will terminate. (f) On the last day of the first Month that commences after the Early Termination Date, or if such last day is not a Business Day, the previous Business Day (the 40

190 Early Termination Payment Date ) Seller shall pay to Indenture Trustee, pursuant to payment instructions issued by Buyer or, in the absence of such instructions, by wire transfer, the Termination Payment and the Additional Termination Payment (if any). Such amounts will be paid together with interest thereon (before as well as after judgment) from (and including) the Early Termination Payment Date to (but excluding) the date such amount is paid, at the Default Rate. The Parties agree that the payment of the Termination Payment and the Additional Termination Payment (if any) is a reasonable pre-estimate of the damages that would be incurred by either Party as a result of termination of this Agreement for any reason and is not a penalty. The obligation of Seller to pay the Termination Payment on the Early Termination Payment Date is unconditional, irrespective of the validity or enforceability of this Agreement or any other Transaction Document, any waiver or consent by Buyer or any other circumstances that might otherwise constitute a legal or equitable discharge of Seller or a defense of Seller to pay the Termination Payment. Seller waives all rights to set-off, counterclaim, recoupment and any other defenses that might otherwise be available to Seller with regard to Seller s obligation to pay the Termination Payment on the Early Termination Payment Date. The obligations of Seller to pay (i) the Termination Payment on the Early Termination Payment Date and (ii) all other payments that become due under this Agreement are unconditional, irrespective of the validity or enforceability of this Agreement or any other Transaction Document, any waiver or consent by Buyer or any other circumstances that might otherwise constitute a legal or equitable discharge of Seller or a defense of Seller to pay the Termination Payment or any other payments that become due under this Agreement. (g) Neither this Agreement nor the Delivery Period may be terminated for any reason except as specified in this Article 17XVII or in Section 2.2. Except with respect to amounts due for periods prior to termination, the payment of the Termination Payment and Additional Termination Payment (if any) shall be the sole and exclusive remedy for each Party upon the termination of the Delivery Period and this Agreement for any reason, including as a result of rejection of this Agreement by either Party in any bankruptcy proceedings. (h) Termination of this Agreement and the Delivery Period shall be without prejudice to any amounts due to either Party for periods prior to termination. The Parties acknowledge that the manner in which the Termination Payment has been calculated for the applicable schedule to the Pricing Agreement may cause Seller, upon paying any Termination Payment, to include amounts in the Termination Payment for Gas that has already been delivered to Buyer. Therefore, in addition to any other amounts due to Seller for periods prior to termination, Seller shall be entitled to collect from Buyer an amount equal to the product of (i) the total quantity of Gas actually delivered to or remarketed for Buyer under this Agreement during the Month in which the Early Termination Date occurred, provided that, in the case of a remarketing for Buyer, the proceeds or deemed proceeds of the remarketing are actually remitted to Buyer, multiplied by (ii) the Fixed Price less the Specified Discount. For the avoidance of doubt, Seller shall not have the right to off-set or net any amounts due to Seller under this subsection (h) or otherwise from the Termination Payment payable to Buyer. (i) An Early Termination Date shall occur automatically hereunder (without the requirement of notice from either Party) under the following circumstances: 41

191 (i) with respect to a Buyer Non-Default Termination Event under Section 17.3(b)(viii) and resulting from termination of a Seller Swap by Seller pursuant to Section 5(a)(iv), 5(a)(viii), 5(b)(i), 5(b)(ii), 5(b)(iii) or 5(b)(iv) thereof, the Early Termination Date shall occur automatically at the end of the Swap Replacement Period described in Section 17.5 if the Buyer Swap and Seller Swap are not replaced within such period, provided that if the Swap Replacement Period is zero days, such Early Termination Date shall occur immediately upon the occurrence of such Buyer Non- Default Termination Event; (ii) with respect to either (A) a Seller Non-Default Termination Event under Section 17.3(a)(iii) resulting from termination of a Buyer Swap pursuant to Section 5(a)(iv), 5(a)(viii), 5(b)(i), 5(b)(ii), 5(b)(iii) or 5(b)(iv) thereof, or (B) a Seller Non- Default Termination Event under Section 17.3(a)(ii) resulting from termination of the Seller Swap for any reason, other than an Event of Default (as defined in the Seller Swap) described in Section 5(a)(i) or 5(a)(iii) thereof in respect of which Seller is the Defaulting Party (as defined in the Seller Swap), the Early Termination Date shall occur automatically at the end of the Swap Replacement Period described in Section 17.5 if the Buyer Swap and Seller Swap are not replaced within such period, provided that if the Swap Replacement Period is zero days, then such Early Termination Date shall occur immediately upon the occurrence of such Seller Non-Default Termination Event; (iii) an Early Termination Date shall occur automatically upon the occurrence of a Buyer Non-Default Termination Event under Section 17.3(b)(vi) resulting from termination of the Interest Rate Swap by Buyer pursuant to Section 5(b)(i) of the Interest Rate Swap; and (iv) an Early Termination Date shall occur automatically upon the occurrence of a Seller Non-Default Termination Event under Section 17.3(a)(iv) resulting from termination of the Interest Rate Swap by Seller pursuant to Section 5(b)(i) of the Interest Rate Swap. Section 17.5 Replacement of Swaps. (a) Buyer or Seller, as applicable, shall promptly notify the other Party of any designation of a Swap Early Termination Date by the Swap Counterparty under either the Buyer Swap or Seller Swap, as applicable. (b) Buyer or Seller, as applicable, shall (i) notify the other Party prior to or contemporaneously with the designation of a Swap Early Termination Date by Buyer or Seller, as applicable, under either the Buyer Swap or Seller Swap, as applicable, and (ii) in designating any Swap Early Termination Date for any reason other than in the case of a Swap Early Termination Date that occurs automatically as a result of an Event of Default (as defined in either the Buyer Swap or Seller Swap, as applicable), ensure that the Swap Replacement Period hereunder will be no less than 45 days. In addition, Buyer agrees that it will not designate a Swap Early Termination Date under the Buyer Swap based on a payment failure of the Swap Counterparty thereunder until such payment failure has continued for more than 90 consecutive 42

192 days, provided that during such 90-day period Buyer is receiving payments due thereunder directly from the Custodian (as defined in the Buyer Swap). (c) (a) In the event that (i) any Buyer Swap or any Seller Swap terminates, (ii) any notice of termination is delivered by any party to a Buyer Swap or Seller Swap or (iii) any Buyer Swap or Seller Swap is otherwise reasonably anticipated to become subject to immediate termination, in each case for any reason other than insolvency of either Buyer or Seller, then the Party whose swap is affected shall notify the other Party and the Parties shallthe Parties agree that, in connection with the designation of a Swap Early Termination Date by Buyer, Seller or the Swap Counterparty, the Parties will, during the Swap Replacement Period, cooperate in good faith for a period of forty-five (45) days (commencing no later than the date on which any notice of termination (or anticipated termination) is delivered by any party to a Buyer Swap or Seller Swap) to (xi) terminate or cause the same Swap Counterparty whose Buyer Swap or Seller Swap has been terminated (or is anticipated to terminate) to terminate its the unaffected Seller Swap or Buyer Swap, as applicable, with the effective date of such termination occurring concurrently with such Swap Early Termination Date, and (yii) locate replacement agreements with an alternate Swap Counterparty to replace both the affected swap and the unaffected swap, with the effective date of such replacement agreements occurring concurrently on the day immediately following such Swap Early Termination Date; provided, however, that: (A) (B) neither Party shall be required to breach any obligation under the unaffected swap or to expend any amounts to cause the unaffected swap to be replaced or to cause an alternate counterparty to replace both swaps. Neither Party shall terminate this Agreement as a result of the termination of any Seller Swap or any Buyer Swap without first complying with this Section 17.5.; and neither Party shall have any obligations under this Section 17.5(c) in connection with any Swap Early Termination Date that occurs automatically under either the Buyer Swap or the Seller Swap. (d) If, in connection with the designation of a Swap Early Termination Date under either the Buyer Swap or the Seller Swap, both the Buyer Swap and the Seller Swap are replaced with replacement agreements in compliance with clause (c) above, then the occurrence of such Swap Early Termination Date under either the Buyer Swap or the Seller Swap will not give rise to a Seller Default, Buyer Default, Seller Non-Default Termination Event or Buyer Non-Default Termination Event, as applicable. (e) The Swap Replacement Period means, in respect of any Swap Early Termination Date, a period of time commencing on the date on which notice is delivered pursuant to Section 17.5(a) or (b) and ending on the date such Swap Early Termination Date occurs; provided that (i) in the case of a Swap Early Termination Date under either the Buyer Swap or the Seller Swap that occurs automatically as a result of a Termination Event or an Event of Default (each as defined in either the Buyer Swap or Seller Swap, as applicable), for reasons other than a Swap Counterparty Insolvency Event, the Swap Replacement Period shall be zero days, (ii) in the case of automatic termination of the Seller Swap or the Buyer Swap due to a Swap Counterparty Insolvency Event, the Swap Replacement Period will end on the later of one 43

193 (1) Business Day after such event or such extension period as elected by Seller under Section 17.4(e) above, and (iii) the Swap Replacement Period shall not exceed forty-five (45) days in respect of any Event of Default (as defined in either the Buyer Swap or Seller Swap, as applicable) or Termination Event (as defined in either the Buyer Swap or Seller Swap, as applicable) that is triggered based on a notice from the Swap Counterparty. (f) (b) Upon written request of Seller and payment of Buyer s reasonable expenses in connection therewith, Buyer shall (i) enter into a master agreement with an alternate Swap Counterparty designated or approved by Seller, and (ii) either (A) terminate the Buyer Swap when permitted thereby and enter into a replacement transaction under such new master agreement to the same effect as the terminated Buyer Swap, or (B) cause such Buyer Swap to be novated to such replacement Swap Counterparty, provided that, in each instance, such replacement Swap Counterparty, replacement master agreement and replacement transaction meet the requirements specified for such under the Bond Indenture. Buyer shall not replace a Buyer Swap without Seller s consent. (g) (c) Each of Buyer and Seller agree that, if it has terminated the Buyer Swap or Seller Swap, as applicable, it will not enter into a replacement Buyer Swap or Seller Swap, as applicable, unless the other party is terminating and replacing its Buyer Swap or Seller Swap, as applicable, with the same replacement Swap Counterparty or is novating its Buyer Swap or Seller Swap, as applicable, to the same replacement Swap Counterparty. Section 17.6 Seller s Right to Issue a Remarketing Notice. Upon Buyer s failure to pay when due any amounts owed to Seller pursuant to this Agreement, which failure continues for five (5) Business Days after receipt by Buyer of notice thereof, Seller shall have the right to issue to itself (with a copy to Buyer) one or more Monthly Remarketing Notices or Daily Remarketing Notices in quantities and with respect to such Delivery Points as Seller determines in its sole discretion are necessary to allow Seller to remarket an additional quantity of Gas above the quantity of Gas then being remarketed for Buyer that is necessary, in Seller s reasonable determination, to be sufficient to generate remarketing proceeds necessary to cover such past due amounts from Buyer. Seller shall have the right to issue additional such Remarketing Notices until payment default by Buyer is fully cured. Section 17.7 LIMITATION ON DAMAGES. THE PARTIES CONFIRM THAT THE EXPRESS REMEDIES AND MEASURES OF DAMAGES PROVIDED IN THIS AGREEMENT SATISFY THE ESSENTIAL PURPOSES HEREOF. FOR BREACH OF ANY PROVISION FOR WHICH AN EXPRESS REMEDY OR MEASURE OF DAMAGES IS HEREIN PROVIDED, SUCH EXPRESS REMEDY OR MEASURE OF DAMAGES SHALL BE THE SOLE AND EXCLUSIVE REMEDY, THE OBLIGOR S LIABILITY SHALL BE LIMITED AS SET FORTH IN SUCH PROVISION AND ALL OTHER REMEDIES OR DAMAGES AT LAW OR IN EQUITY ARE WAIVED. NEITHER PARTY SHALL BE LIABLE FOR CONSEQUENTIAL, INCIDENTAL, PUNITIVE, EXEMPLARY, OR INDIRECT DAMAGES, LOST PROFITS OR OTHER BUSINESS INTERRUPTION DAMAGES, BY STATUTE, IN TORT OR CONTRACT, UNDER ANY INDEMNITY PROVISION OR OTHERWISE. IT IS THE INTENT OF THE PARTIES THAT THE LIMITATIONS HEREIN IMPOSED ON REMEDIES AND THE MEASURE OF DAMAGES BE WITHOUT REGARD TO THE CAUSE OR CAUSES RELATED THERETO, 44

194 INCLUDING, WITHOUT LIMITATION, THE NEGLIGENCE OF ANY PARTY, WHETHER SUCH NEGLIGENCE BE SOLE, JOINT OR CONCURRENT, OR ACTIVE OR PASSIVE, TO THE EXTENT ANY DAMAGES REQUIRED TO BE PAID UNDER THIS AGREEMENT ARE LIQUIDATED, THE PARTIES ACKNOWLEDGE THAT THE DAMAGES ARE DIFFICULT OR IMPOSSIBLE TO DETERMINE, OTHERWISE OBTAINING AN ADEQUATE REMEDY IS INCONVENIENT AND THE LIQUIDATED DAMAGES CONSTITUTE A REASONABLE APPROXIMATION OF THE HARM OR LOSS. IN DETERMINING THE APPROPRIATE MEASURE OF DAMAGES THAT WOULD MAKE THE PARTIES WHOLE, THE PARTIES HAVE THOROUGHLY CONSIDERED, INTER ALIA, THE UNCERTAINTY OF FLUCTUATIONS IN GAS PRICES, THE ABILITY AND INTENTION OF THE PARTIES TO HEDGE SUCH FLUCTUATIONS, THE BARGAINED- FOR ALLOCATION OF RISK, THE KNOWLEDGE, SOPHISTICATION AND EQUAL BARGAINING POWER OF THE PARTIES, THE ARMS-LENGTH NATURE OF THE NEGOTIATIONS, THE SPECIAL CIRCUMSTANCES OF THIS TRANSACTION, THE ACCOUNTING AND TAX TREATMENT OF THE TRANSACTION BY THE PARTIES AND THE ENTERING INTO OF OTHER TRANSACTIONS IN RELIANCE ON THE ENFORCEABILITY OF THE LIQUIDATED DAMAGES PROVISIONS CONTAINED HEREIN. THE PARTIES ACKNOWLEDGE THAT THIS IS A SALE OF GOODS. ARTICLE XVIII MISCELLANEOUS Section 18.1 Deliveries. No later than delivery of the Prepayment, the Parties will deliverdelivered the following documents to one another: (a) by Buyer, evidence reasonable satisfactory to Seller of (i) the appropriate individuals who are authorized to sign this Agreement, and (ii) a specimen signature of the authorized individual signing this Agreement; (b) by Seller, evidence reasonably satisfactory to Buyer, of (i) the appropriate individuals who are authorized to sign this Agreement, and (ii) a specimen signature of the authorized individual signing this Agreement; and (c) by Seller, a Seller s Guaranty, together with evidence reasonably satisfactory to Buyer of (i) the appropriate individuals who are authorized to sign the Seller s Guaranty, and (ii) a specimen signature of the authorized individual signing the Seller s Guaranty. Section 18.2 Entirety; Amendments. (a) The Transaction Documents, including the exhibits and attachments to each, constitute the entire agreement between the Parties, and supersede all prior discussions and agreements between the Parties with respect to the subject matter hereof. There are no prior or contemporaneous agreements or representations affecting the same subject matter other than those herein expressed. Except for any matters that, in accordance with the express provisions of this Agreement, may be resolved by oral agreement between the Parties, no amendment, 45

195 modification or change herein shall be enforceable unless reduced to writing and executed by both Parties. (b) If a Remarketing Default occurs, then Buyer and Seller may amend this Agreement to reduce the Daily Contract Quantity for one or more subsequent Months and to obligate Seller to pay to the Indenture Trustee for the account of Buyer, prior to the date for the resulting mandatory redemption of Bonds pursuant to Section 4.01 of the Bond Indenture, an amount sufficient, together with other funds available under the terms of the Bond Indenture for such purpose, to pay the redemption price of such Bonds due on such redemption date and any settlement payable by Buyer due to the corresponding amendments to the Buyer s Swap and the Interest Rate Swap, and Buyer and Seller may simultaneously amend the Pricing Agreement to reduce the Termination Payment for one or more such Months, but in each case only if Buyer and Seller have delivered to the Indenture Trustee: (i) An executed counterpart of such amendment (and written confirmation from Seller s Guarantor that its obligation under the Seller s Guaranty will remain in full force and effect after such amendment); (ii) An executed counterpart of an amendment to the Gas Supply Contract reducing the Daily Contract Quantity to be sold and delivered thereunder in the same Months by the same quantities; (iii) An executed counterpart of an amendment to the Buyer Swap reducing the notional amounts thereunder for the same Months by the same quantities; (iv) An executed counterpart to the Interest Rate Swap reducing the notional amounts thereunder in each subsequent Month by the amount by which the principal amount of Bonds of the related series scheduled to remain outstanding in such Month will be reduced as a result of such redemption; (v) The revised schedules, Written Directions (as defined in the Bond Indenture) and Accountant s Certificate (as defined in the Bond Indenture) required by Section 4.11 of the Bond Indenture in connection with such redemption; (vi) An Accountant s Certificate to the effect that the scheduled Termination Payments for this Agreement for each Month thereafter is equal to or exceeds the aggregate principal amount of and interest on the Bonds scheduled to remain outstanding at the beginning of such Month, assuming that the Bonds are redeemed in accordance with Section 4.02 of the Bond Indenture but not otherwise, less the scheduled balance of the Debt Service Fund (as defined in the Bond Indenture) at the end of such Month; (vii) The accompanying Opinion of Bond Counsel (as defined in the Bond Indenture) required by Section 4.11 of the Bond Indenture for such redemption; and (viii) Rating Confirmation (as described in the Bond Indenture) in respect of such amendments and redemption. 46

196 Section 18.3 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 NEW YORK, WITHOUT REGARD TO ANY CONFLICTS OF LAW PRINCIPLE THAT WOULD DIRECT THE APPLICATION OF ANOTHER JURISDICTION S LAW; PROVIDED THAT (A) THE AUTHORITY OF BUYER TO ENTER INTO AND PERFORM ITS OBLIGATIONS UNDER THIS AGREEMENT SHALL BE DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA, AND (B) FOR THE AVOIDANCE OF DOUBT, CALIFORNIA RULES OF EVIDENCE AND PROCEDURE SHALL APPLY IN ANY DISPUTE BROUGHT BEFORE A STATE COURT IN CALIFORNIA. Section 18.4 Non-Waiver. No waiver of any breach of any of the terms of this Agreement shall be effective unless such waiver is in writing and signed by the Party against whom such waiver is claimed. No waiver of any breach shall be deemed a waiver of any other subsequent breach. Section 18.5 Severability. If any provision of this Agreement, or the application thereof, shall for any reason be invalid or unenforceable, then to the extent of such invalidity or unenforceability, the remainder of this Agreement and the application of such provision to other Persons or circumstances shall not be affected thereby, but rather shall be enforced to the maximum extent permissible under applicable Law, so long as the economic and legal substance of the transactions contemplated hereby is not affected in any materially adverse manner as to any Party. Section 18.6 Exhibits. Any and all Exhibits referenced in this Agreement are hereby incorporated herein by reference and shall be deemed to be an integral part hereof. Section 18.7 Winding Up Arrangements. All indemnity obligations, audit rights, payment of the Termination Payment and Additional Termination Payment (if any) and other provisions specifically providing for survival shall survive the expiration or termination of this Agreement. The expiration or termination of this Agreement shall not relieve either Party of any unfulfilled obligation or undischarged liability of such Party on the date of such termination. Section 18.8 Relationships of Parties. The Parties shall not be deemed to be in a relationship of partners or joint ventures by virtue of this Agreement, nor shall either Party be an agent (except to the extent provided in Section 7.5), representative, trustee or fiduciary of the other. Neither Party shall have any authority to bind the other to any agreement. This Agreement is intended to secure and provide for the services of each Party as an independent contractor. Section 18.9 Immunity. Buyer represents and covenants to and agrees with Seller that it is not entitled to and shall not assert the defense of sovereign immunity with respect to its obligations or any claims under this Agreement. Section Limited Liability. 47

197 (a) Buyer shall be obligated to observe and perform its obligations hereunder solely from and to the extent of the Trust Estate, as defined in the Bond Indenture, available to be applied for such purpose in accordance with the Bond Indenture, to which all recourse of Seller shall be limited. No provision of this Agreement shall require Buyer to expend or risk any other funds or incur any other financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers. Anything in this Agreement to the contrary notwithstanding, the performance by Buyer of all duties and obligations imposed upon it hereby, the exercise by it of all powers granted to it hereunder, the carrying out of all covenants, agreements, and promises made by it hereunder, and liability of Buyer for all warranties and other covenants herein shall be limited solely to such Trust Estate; and Buyer shall not be required to effectuate any of such duties, obligations, powers, or covenants except from, and to the extent of, such Trust Estate. Whether or not therein expressly so provided, every provision of this Agreement shall be subject to the provisions of this Section 18.10(a). Neither Seller nor any other beneficiary hereof shall have any right to demand payment or performance by Buyer out of money raised or to be raised by taxation. (b) No recourse under or upon any obligation, covenant, or agreement contained in this Agreement, or for any claim based thereon or otherwise in respect thereof, shall be had against any incorporator or any past, present, or future director, officer, employee, or agent or member of the governing body, as such, of either Party or its sponsor (including any Project Participant) or any successor, either directly or through such party, whether by virtue of any constitution or statute or rule of law, or by the enforcement of any assessment, judgment, or penalty, or otherwise; it being expressly understood that this Agreement is solely a corporate obligation, and that no such personal liability whatever shall attach to, or is or shall be incurred by, the incorporators, directors, officers, employees, sponsor, or agents, as such, of such Party or any successor, or any member of its governing body, or any of them, by reason of the obligations, covenants, or agreements contained in this Agreement or implied therefrom, and that any and all such personal liability either at common law or equity or by constitution or statute of, and any and all such rights and claims against, every such incorporator, member, director, officer, employee, sponsor, or Person, as such, are hereby expressly waived and released as a condition of, and in consideration for, the execution of this Agreement. Section Rates and Indices. (a) If a Daily Commodity Reference Price is not available for any Gas Day, then the Daily Commodity Reference Price for such Gas Day shall be the average of the following: (i) the Daily Commodity Reference Price for the first Gas Day for which a price has been published that next precedes the relevant Gas Day; and (ii) the Daily Commodity Reference Price for the first Gas Day for which a Daily Commodity Reference Price is published that next follows the relevant Gas Day, provided that if the Daily Commodity Reference Price is not available for six (6) consecutive Gas Days or ceases to be published, then the Parties shall promptly endeavor to agree on an alternative source for determination of such Daily Commodity Reference Price for that Gas Day (or permanently if it ceases to be published). If such agreement is not reached by the Parties within three (3) Business Days, the Parties shall request a Daily Commodity Reference Price from four (4) recognized dealers in the relevant commodity (two (2) selected by each Party). If four quotations are provided as requested, the price for that Gas Day will be the arithmetic mean of the Daily Commodity Reference Prices for the relevant 48

198 commodity provided by each recognized dealer, without regard to the Daily Commodity Reference Prices having the highest and lowest values. If exactly three quotations are provided, the price for that Gas Day will be the Daily Commodity Reference Price provided by the relevant dealer that remains after disregarding the Daily Commodity Reference Prices having the highest and lowest values. For this purpose, if more than one quotation has the same highest value or lowest value, then the Daily Commodity Reference Price of one of such quotation shall be disregarded. (b) If the Monthly Index Price is not available or ceases to be published, then Buyer and Seller shall promptly endeavor to negotiate in good faith to select a suitable substitute Monthly Index Price. If such agreement is not reached by the Parties within three (3) Business Days, the Parties shall select at least three (3) and no more than four (4) recognized dealers in the relevant commodity (two (2) selected by each Party). If four quotations are provided as requested, the price for that Gas Day will be the arithmetic mean of the Monthly Index Prices for the relevant commodity provided by each recognized dealer, without regard to the Monthly Index Prices having the highest and lowest values. If exactly three quotations are provided, the price for that Gas Day will be the Monthly Index Price provided by the relevant dealer that remains after disregarding the Monthly Index Prices having the highest and lowest values. For this purpose, if more than one quotation has the same highest value or lowest value, then the Monthly Index Price of one of such quotation shall be disregarded. (c) For purposes of determining a replacement Daily Commodity Reference Price or Monthly Index Price in the case where such price is no longer published, the Parties acknowledge and agree that price quotations from dealers described in the last sentence Section 18.11(a) and the last sentence of Section 18.11(b) will be sought based upon a differential between physical prices at the Delivery Point and a published index price that is agreed by the Parties as most closely approximating physical prices at the Delivery Point. If the Parties, acting in good faith, are unable to agree upon such a published index price or the differential, Seller shall determine in a Commercially Reasonable manner the published index price and the differential to be used for such quotations. (d) If a value published for any rate or index used or to be used in this Agreement is subsequently corrected and the correction is published or announced by the person responsible for that publication or announcement within thirty (30) days after the original publication or announcement, either Party may notify the other Party of (i) that correction and (ii) the amount (if any) that is payable as a result of that correction. If, not later than thirty (30) days after publication or announcement of that correction, a Party gives notice that an amount is so payable, the Party that originally either received or retained such amount will, not later than three (3) Business Days after the effectiveness of that notice, pay, subject to any other applicable provisions of this Agreement, to the other Party that amount, together with interest on that amount at the Default Rate for the period from and including the day on which a payment originally was (or was not) made to but excluding the day of payment of the refund or payment resulting from that correction. Section Counterparts. This Agreement may be executed and acknowledged in multiple counterparts and by different Parties in separate counterparts, each of which shall be an original and all of which shall be and constitute one and the same instrument. 49

199 Section Rights of Indenture Trustee. Pursuant to the terms of the Bond Indenture, Buyer has granted the Indenture Trustee certain rights to take certain actions that Buyer is required or permitted to take under this Agreement. Seller may rely on notices or other actions taken by Buyer or the Indenture Trustee issued pursuant to its authority under the Bond Indenture and Seller has the right to exclusively rely on any notices delivered by the Indenture Trustee, regardless of any conflicting notices that it may receive from Buyer or a Nominating Agent. Section Representation by Counsel; Drafting. Each Party acknowledges that it has been represented by counsel in negotiating, executing and drafting this Agreement. Each provision of this Agreement shall be construed with the recognition that all Parties participated in the drafting of the same. Thus, any rule of construction that requires this Agreement to be construed against the drafting Party shall not be applicable. Both Parties hereto agree that in any action to enforce the terms of this Agreement, each Party shall be responsible for its own attorneys fees and expenses. Section Waiver of Defenses. Seller waives all rights to set-off, counterclaim, recoupment and any other defenses that might otherwise be available to Seller with regard to Seller s obligations pursuant to the terms of this Agreement. [Signature Page Follows] 50

200 In Witness Whereof, Buyer and Seller have caused this Prepaid Natural Gas Sales Agreement to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first above written. J. ARON & COMPANY By: Name: Title: SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY By: Name: Title:

201 EXHIBIT A-1 PRIMARY DELIVERY POINTS Pipeline Primary Delivery Point Daily Index Price Index Price (Low) Monthly Index Price SoCal System On the SoCal System to an End-User s Local Transportation Agreement or a Citygate Pool Account* The Midpoint price (in $/MMBtu) published in Gas Daily (published by Platts, a division of the McGraw-Hill Companies) under the heading Daily price survey for SoCal gas, citygate for the Flow date corresponding to such Gas Day. The lowest price (in $/MMBtu) published in the Common range in Gas Daily (published by Platts, a division of the McGraw-Hill Companies) under the heading Daily price survey for SoCal gas, city-gate for the Flow date corresponding to such Gas Day. The index price (in $/MMBtu) published in NGI s Bidweek Survey (published by Intelligence Press, Inc. or its successor) that reports prices for such Month under the heading Spot Gas Prices: California: SoCal Citygate Avg.:avg. * Buyer (or the Nominating Agent) shall have the right to nominate the relevant End-User Local Transportation Agreement or Citygate Pool Account to be used on reasonable notice given to Seller prior to the relevant scheduling deadlines applicable to the SoCal System. The terms End-User s Local Transportation Agreement and Citygate Pool Account are defined in the rules issued by the operator of the SoCal System with respect to deliveries on the SoCal System and refer to delivery location designations for Gas to be delivered within the SoCal System. If either such delivery location designation is redefined or replaced in any modification to such rules, then, for purposes of the definition of Primary Delivery Point, the most closely analogous delivery location designation in the rules as modified shall apply. If, at any time, Seller is required to pay any charges or fees to deliver from Seller s pool account on the SoCal System to any delivery location designated by Buyer or the Nominating Agent, such charges shall be for Buyer s account and Seller may invoice Buyer for such charges on a monthly basis. A-1-1

202 Exhibit A-2 Quantities of Gas for Delivery (in MMBtu) by Month and Nominating Agent Attached. A-2-1

203 EXHIBIT A-3 REVISED DELIVERY POINTS The Parties acknowledge that, during the Delivery Period, it may be beneficial for the Parties to replace the Primary Delivery Point in response to changes on the SoCal System. This Exhibit A-3 describes the process the Parties will use to attempt to mutually agree upon a revised Primary Delivery Point or, in the absence of such agreement, the circumstances under which either Seller or Buyer may designate a revised Primary Delivery Point. In addition, this Exhibit A-3 describes the circumstances under which Buyer may select one or more Alternate Delivery Points in the absence of explicit mutual agreement of the Parties. The Nominating Agent shall have the right to undertake on Buyer s behalf the actions permitted or required of Buyer under this Exhibit A Negotiation of Revised Primary Delivery Point. The Parties acknowledge that the SoCal System tariff is currently undergoing revisions to introduce firm access rights ( FAR ) at system receipt points. FAR is expected to be fully implemented for deliveries beginning on September 1, Similarly, the Parties acknowledge that other changes on the SoCal System (either in the alternative to FAR, further refinements to FAR or unanticipated changes) may occur that would affect the viability of the Primary Delivery Point for one or both Parties. Therefore, in preparation for the implementation of FAR (or, upon request from either Party in response to other future changes on the SoCal System), (a) Buyer agrees to cause the Nominating Agent under this Agreement to keep Seller reasonably well-apprised of such Nominating Agent s strategy for obtaining receipt point capacity to receive Gas under this Agreement, (b) the Parties agree to negotiate in good faith (and Buyer agrees to cause the Nominating Agent to nominate in good faith) until the operational implementation of FAR (or such other changes) with respect to changes in the Primary Delivery Point (and related changes to published prices used in this Agreement) to be implemented in response to the implementation of FAR (or such other changes), with the intent being to (i) maintain Buyer s responsibility for any increased transportation or other costs involved in delivering Gas at any point other than the original Primary Delivery Point, (ii) maintain Seller s rights to coordinate its delivery obligations under this Agreement with available supply at the Primary Delivery Point (which, as of the start of the Delivery Period, consists of a Seller s choice to deliver to any border receipt point on the SoCal System), and (iii) with respect to responding to FAR, if an appropriate citygate market (and corresponding published prices) develops on the SoCal System, to move the Primary Delivery Point to such citygate. A-3-1

204 2. New Primary Delivery Point. a. If (i) the Project Participant under the Gas Supply Contract anticipates that Changed Circumstances will make it no longer possible for such Project Participant to receive the Daily Contract Quantity at the initial Primary Delivery Point for the remainder of the Delivery Period, and (ii) if such Changed Circumstances are contemplated by paragraph 1 above, the Parties are unable to agree under paragraph 1 to a revised Primary Delivery Point within a reasonable period of time prior to the implementation of such Changed Circumstance, then Buyer may propose one (1) or two (2) new Primary Delivery Points (each, a New PDP ) to apply for the remainder of the Delivery Period, provided that at the time of the request: i. The New PDP is a Liquid Point, and ii. the New PDP is in the Southern California market or Buyer represents that (A) the Gas to be delivered to the Project Participant at the New PDP will be delivered for a use in the Southern California market, and (B) the Project Participant has arranged for adequate transportation rights to transport (or cause to be transported) the Gas to the Southern California market. b. Any request for a New PDP must be issued (i) with respect to a request for a New PDP on the SoCal System in response to Changed Circumstances affecting a Project Participant s rights to receive Gas on the SoCal System, as soon as reasonably practicable but no later than the earlier of (A) thirty (30) days prior to the first of the Month in which such New PDP will take effect, or (B) ten (10) days after the relevant Project Participant s relevant receipt point rights in connection with such Changed Circumstances have been established, and (ii) in any other case, one year prior to the Month in which such New PDP will take effect. In any New PDPs requested, the request must include the volume to be delivered to each New PDP. c. Changed Circumstances means a change in law, a change in the tariff of the Receiving Transporter at the Primary Delivery Point or an operational constraint (including but not limited to the Project Participant s inability to obtain primary receipt point rights on Commercially Reasonable terms) occurring at any time after the Execution Date that, in any case, makes it operationally or economically impracticable for the Project Participant to receive the full Daily Contract Quantity under the Gas Supply Contract at the Primary Delivery Point. d. A Liquid Point is any pipeline delivery point (i) where substantial trading of Gas is expected to occur in the relevant month(s) (i.e., a substantial number of both buyers and sellers), (ii) where a published A-3-2

205 monthly index is available in Natural Gas Intelligence at the time of the proposal, or, subject to the mutual agreement of the Parties, another publication, and (iii) where the published index price is based upon a substantial number of reported trades as reasonably determined by the Seller. 3. Alternate Delivery Points a. If the Project Participant under the Gas Supply Contract anticipates that Changed Circumstances will make it unable to receive from Buyer all or any portion of the Gas to be delivered to Buyer under this Agreement at the Primary Delivery Point (including a New PDP), Buyer may request a Liquid Point as an Alternate Delivery Point (such requested point, a Requested ADP ) for a specified quantity of Gas (the ADP Quantity ), provided that at the time of the request: i. the Requested ADP is a Liquid Point, and ii. the Requested ADP is in the Southern California market or Buyer represents that (A) the Gas to be delivered to the Project Participant at the Requested ADP will be delivered for use in the Southern California market, and (B) the Project Participant has arranged for adequate transportation rights to transport (or cause to be transported) the Gas to the Southern California market. b. Any request for a Requested ADP must be issued (i) with respect to a Requested ADP on the SoCal System in response to Changed Circumstances affecting a Project Participant s rights to receive Gas on the SoCal System, as soon as reasonably practicable but no later than the earlier of (A) thirty (30) days prior to the first of the Month in which such Requested ADP will take effect, or (B) ten (10) days after the relevant Project Participant s relevant receipt point rights in connection with such Changed Circumstances have been established, and (ii) in any other case, one year prior to the Month in which such Requested ADP will take effect. c. At no time shall Buyer be entitled to have more than three Alternate Delivery Points under this Agreement at any time; provided, however, that (i) a SoCal citygate Alternate Delivery Point shall not be included in calculating this limit; and (ii) if the total number of Alternate Delivery Points under all Related Prepaid Contracts is less than twelve, then, Buyer may designate in a written notice to Seller a higher limit applicable to this Agreement and a lower limit applicable to one or more other Related Prepaid Contracts so that the number of all such Alternate Delivery Points never exceeds twelve (12) in the aggregate under this Agreement and all such Related Prepaid Contracts. A-3-3

206 d. Buyer could not issue more than four requests with respect to any calendar year under this Agreement. 4. Seller s Response to a Request to Change Delivery Points a. Within five (5) Business Days after receiving a written request for a New PDP or Requested ADP (each, a Revised Delivery Point ), Seller will indicate (i) whether it is able, through the exercise of Commercially Reasonable Efforts, to obtain the Gas that it will be required to deliver to the Revised Delivery Point for the requested period of deliveries, (ii) any increase in physical premiums that would be necessary to obtain and deliver such quantity at the Revised Delivery Point for such requested period of deliveries, (iii) any physical premium Seller is required to pay in order to dispose of such quantity at the previous delivery point (whether a Primary Delivery Point or an Alternate Delivery Point) (the sum of (ii) and (iii) being Increased Costs ), and (iv) the references for Daily Index Price, Index Price (Low) and Monthly Index Price that will apply to such Revised Delivery Point, as applicable under this Agreement. Seller will exercise Commercially Reasonable Efforts to minimize Increased Costs. b. Within twenty-four (24) hours after receiving Seller s response, Buyer will indicate whether it desires to effect the move to the Revised Delivery Point. c. Buyer will pay to Seller any Increased Costs in the Month following each applicable Month of delivery. d. If a Buyer agrees to effect the move to a Revised Delivery Point in accordance with clause (a), above, the Revised Delivery Point shall become a Primary Delivery Point or Alternate Delivery Point, as applicable, for all purposes of this Agreement except where the context otherwise requires that additional meaning be given to the term Revised Delivery Point. 5. Delivery to Citygate at Seller s Option. Notwithstanding any other provision of this Agreement, Seller shall have the right, upon prior notice to the Nominating Agent, to deliver Gas that otherwise would have been delivered to any Delivery Point that is a border receipt point on the SoCal System to a citygate pool on the SoCal System and such Gas will be deemed to have been delivered to the relevant Delivery Point. In such a case, Buyer shall not be responsible for any increased costs or change in index prices related to such change in Delivery Point, provided that Buyer will exercise Commercially Reasonable Efforts (and cause the Nominating Agent to exercise Commercially Reasonable Efforts) to accommodate and schedule such a change. A-3-4

207 EXHIBIT B NOTICES IF TO SELLER: J. Aron & Company 85 Broad200 West Street New York, NY Trading: Chuck AmesOwen West Telephone: (212) [email protected] [email protected] John Tully Scheduling: Telephone: (212) [email protected] Scheduling: [email protected] Direct Phone: Fax: Clarissa Garcia Natural Gas Scheduler AOL IM: [email protected] Fax Direct Phone: (212) ficc-jaron-natgasops@ny. .gs.com Cell Phone: (713) Warren Harding Natural Gas Scheduler AOL IM: [email protected] Direct Phone: (403) Cell Phone: (403) MattMatthew Speltz Natural Gas Scheduling Manager TelephoneDirect Phone: (212403) [email protected] Cell Phone: (917) Jim Brush Payments: Federica Pinelli Telephone: (212917) Payments: Andrew Foss TelephoneHotline : (212) Fax: [email protected] B-1

208 Invoicing/ Tahseen BockSofya Shubayeva Statements: Telephone: (917212) Fax: (646) General Notices: Andrew Snyder Telephone: (917) Fax: (646) Meg Vaden Telephone: (212) Fax: (212) John Thomas Telephone: (212) Fax: (212) IF TO BUYER: Southern California Public Power Authority 225 South Lake Avenue, Suite # Nicole Court PasadenaGlendora, California Attention: Executive Director Telephone: (626) Fax: (626) [email protected] B-2

209 EXHIBIT C ADDITIONAL TERMINATION PAYMENT In the event an Early Termination Date is declared by Buyer as a result of a Seller Default or as a result of a Buyer Non-Default Termination Event under Section 17.3(b)(iii), (iv) or, (vi), or (x) Seller shall calculate the Additional Termination Payment. Additional Termination Payment means, with respect to an Early Termination Date declared by Buyer as a result of a Seller Default or as a result of a Buyer Non-Default Termination Event under Section 17.3(b)(iii), (iv) or, (vi), or (x), the net present value as of such Early Termination Date of a stream of Monthly payments for each Month that would have remained in the Delivery Period had such Early Termination Date not occurred, with each such Monthly payment equal to (i) the quantity of Gas that Seller would have been required to deliver during such Month, multiplied by (ii) the greater of: (A) the ATP Minimum in effect as of the Early Termination Date, or (B) the lesser of the ATP Discount or an amount determined by Seller in a Commercially Reasonable manner as the excess (if any) (in $/MMBtu) of (1) the ATP Discount, over (2) the new savings relative to monthly index prices available to Buyer if Buyer entered into (as of the Early Termination Date) a new prepaid natural gas transaction (and related bond issuance and Buyer Swap structure) with such new savings calculated using the same methodology as was used to calculate the ATP Discount and using the following inputs: (x) except as specified in clauses (y) and (z), all inputs (including a delivery period of the same length as the original Delivery Period, the same original Gas volume schedule, the same Gas supplier spread to the LIBOR Discount Curve and the same municipal bond spreads) will be identical to those as were used to calculate the ATP Discount, and (y) first Gas deliveries under the new prepaid contract would be deemed to commence in the first July that commences following the Early Termination Date; and (z) inputs for the LIBOR Discount Curve, tax-exempt yields, and forward Gas prices then in effect at the Primary Delivery Point will be based on rates and prices as of the Early Termination Date. Seller shall determine forward Gas prices by the average of price quotations obtained from at least two and no more than four recognized dealers in Gas. To the extent available, Seller shall determine interest rates by reference to quotations of relevant interest rates from one or more leading dealers in the relevant markets. C-1

210 For purposes of the foregoing the net present value shall be calculated (i) assuming each such future Monthly payment would have been paid on the last day of the Month to which it relates, and (ii) using a discount rate equal to the LIBOR Discount Curve plus the Discount Rate Spread. For purposes of determining the savings in clause (B) above, the discount curve shall be calculated over the same period as the delivery period under the theoretical prepaid contract being measured. For purposes of calculating net present value the discount curve shall be calculated over the Remaining Period. The ATP Minimum means: (a) with respect to an Early Termination Date that occurs on or prior to the fifth (5 th ) annual anniversary of the Original Execution Date (as defined below), an amount equal to $0.05/MMBtu; (b) with respect to an Early Termination Date that occurs after the fifth (5 th ) annual anniversary of the Original Execution Date but on or before the tenth (10 th ) annual anniversary of the Original Execution Date, an amount equal to $0.10/MMBtu; (c) with respect to an Early Termination Date that occurs after the tenth (10 th ) annual anniversary of the Original Execution Date but on or before the fifteenth (15 th ) annual anniversary of the Original Execution Date, an amount equal to $0.15/MMBtu; and (d) with respect to an Early Termination Date that occurs after the fifteenth (15 th ) annual anniversary of the Original Execution Date, an amount equal to $0.20/MMBtu. The LIBOR Discount Curve is a percentage determined by Seller in accordance with standard market practices as the then prevailing LIBOR discount curve at the time of determining the Additional Termination Payment. The Original Execution Date means October 3, The Remaining Period means the period of time that would have remained during the Delivery Period following such Early Termination Date had such Early Termination Date not occurred. C-2

211 EXHIBIT D ALTERNATIVE CREDIT SUPPORT[RESERVED] In the event Seller elects to provide Alternative Credit Support to avoid a Seller Default under Section 17.1(e) of the Agreement, the provisions of this Exhibit D shall apply. 1. Defined Terms. In addition to the terms defined in Article I of this Agreement, the following terms used in this Exhibit D shall have the following meanings: Alternative Credit Support means credit support in the form of Cash, a Letter of Credit or Other Collateral. Cash means U.S. dollars. Collateral Requirement means either (i) at any time while Seller s Guarantor has a Credit Rating of BBB- or higher by S&P and Baa3 or higher by Moody s, zero (0), or (ii) at any other time, an amount equal to one hundred ten percent (110%) of the then-applicable Termination Payment if the Agreement were to be terminated at such time. Custodial Account means an account within the Custodian, which account is (i) owned by Seller, and (ii) over which Buyer has a perfected first-priority lien evidenced by way of a control agreement that is proposed by Custodian and Seller and reasonably acceptable to Buyer. Custodian means a Qualified Institution selected by Seller to maintain the Custodial Account. Letter of Credit means an irrevocable, transferable, standby letter of credit, issued by a Person with a Credit Rating of at least (a) A- by S&P and A3 by Moody s, if such entity is rated by both S&P and Moody s or (b) A- by S&P or A3 by Moody s, if such entity is rated by either S&P or Moody s but not both, substantially in the form set forth in Schedule 1 attached hereto, with such changes to the terms in that form as the issuing bank may require and as may be acceptable to the beneficiary thereof. Letter of Credit Default means with respect to a Letter of Credit, the occurrence of any of the following events: (a) the issuer of such Letter of Credit shall fail to maintain a Credit Rating of at least (i) A- by S&P or A3 by Moody s, if such issuer is rated by both S&P and Moody s, (ii) A- by S&P, if such issuer is rated only by S&P, or (iii) A3 by Moody s, if such issuer is rated only by Moody s; (b) the issuer of the Letter of Credit shall fail to comply with or perform its obligations under such Letter of Credit; (c) the issuer of such Letter of Credit shall disaffirm, disclaim, repudiate or reject, in whole or in part, or challenge the validity of, such Letter of Credit; (d) such Letter of Credit shall expire or terminate, or shall fail or cease to be in full force and effect at any time during the term of the Agreement, in any such case without replacement; or (e) the issuer of such Letter of Credit shall become bankrupt; provided, however, that no Letter of Credit Default shall occur or be continuing in any event with respect to a Letter of Credit after the time such Letter of Credit is required to be canceled or returned to Seller in accordance with the terms hereof. D-1

212 Other Collateral means United States Treasury securities, or such other collateral as the Parties may mutually agree. Qualified Institution means a commercial bank or trust company organized under the laws of the United States or a political subdivision thereof, with (i) a Credit Rating of at least (a) A- by S&P and A3 by Moody s, if such entity is rated by both S&P and Moody s or (b) A- by S&P or A3 by Moody s, if such entity is rated by either S&P or Moody s but not both, and (ii) having a capital surplus of at least $1,000,000,000. Transfer means, with respect to any Alternative Credit Support: (a) in the case of Cash, payment or transfer by wire transfer into one or more bank accounts specified by the recipient; (b) in the case of Letters of Credit, delivery of the Letter of Credit or an amendment thereto to the recipient; and (c) the recipient. in the case of any other type of Other Collateral, delivery thereof as specified by 2. Delivery of Alternative Credit Support. In the event Seller elects to deliver Alternative Credit Support to Buyer, Seller shall Transfer to Buyer or the Custodian the Alternative Credit Support in an amount equal to the Collateral Requirement then in effect. 3. Reduction of Alternative Credit Support. On any Business Day, Seller may request a reduction in the amount of Alternative Credit Support previously provided by Seller to an amount equal to the then-applicable Collateral Requirement. A permitted reduction in Alternative Credit Support may be effected by the Transfer of Cash or Other Collateral to Seller or the reduction of the amount of an outstanding Letter of Credit previously issued for the benefit of Buyer. Seller shall have the right to specify the means of effecting the reduction in Alternative Credit Support. In all cases, the cost and expense of reducing Alternative Credit Support (including, but not limited to, the reasonable costs, and expenses of Buyer) shall be borne by Seller. Unless otherwise agreed in writing by the Parties, Buyer shall have one (1) Business Day following a proper demand to reduce Alternative Credit Support issued by Seller to effect a permitted reduction in Alternative Credit Support provided in the form of Cash or Other Collateral. Transfers of Cash and Other Collateral shall be effected by Buyer issuing proper instructions to the Custodian. If a permitted reduction in Alternative Credit Support is to be effected by a reduction in the amount of an outstanding Letter of Credit previously issued for the benefit of Buyer, then Buyer shall promptly take such action as is reasonably necessary to effectuate such reduction. Seller may include in any Letter of Credit a mechanism that automatically adjusts the stated amount of such Letter of Credit based on scheduled changes in the amount of the Termination Payment. 4. Substitution of Alternative Credit Support. Seller may substitute Alternative Credit Support for other existing Alternative Credit Support of equal value upon one (1) Business Day s written notice to Buyer. Upon the Transfer to the Buyer and/or the Custodian of the substitute D-2

213 Alternative Credit Support, Buyer and/or the Custodian shall Transfer the relevant replaced Alternative Credit Support to Seller within two (2) Business Days. 5. Administration of Alternative Credit Support in the Form of Cash and Other Collateral. All Cash and Other Collateral provided as Alternative Credit Support shall be held by a Custodian in a Custodial Account. Seller s obligations to make any Transfer will be discharged by making the Transfer to that Custodian for credit to the Custodial Account. The Transfer of any Alternative Credit Support by Buyer and/or the Custodian in accordance with Paragraph 3 above shall be deemed a release by Buyer of its security interest in such Alternative Credit Support as evidenced by the agreement for the Custodial Account. 6. Administration of Alternative Credit Support in the Form of Letters of Credit. Seller shall (A) renew or cause the renewal of each outstanding Letter of Credit on a timely basis as provided in the relevant Letter of Credit, (B) if the bank that issued an outstanding Letter of Credit has indicated its intent not to renew such Letter of Credit, provide either a substitute Letter of Credit or other Alternative Credit Support, in each case at least twenty (20) Business Days prior to the expiration of the outstanding Letter of Credit, and (C) if a bank issuing a Letter of Credit shall fail to honor Buyer s properly documented request to draw on an outstanding Letter of Credit, provide for the benefit of Buyer either a substitute Letter of Credit that is issued by a Qualified Institution or other Alternative Credit Support, in each case within one (1) Business Day after such refusal. As one method of providing Alternative Credit Support, Seller may increase the amount of an outstanding Letter of Credit or establish one or more additional Letters of Credit. Upon the occurrence of a Letter of Credit Default, Seller agrees to Transfer to Buyer either a substitute Letter of Credit or other Alternative Credit Support, in each case on or before the first Business Day after the occurrence thereof (or the fifth (5th) Business Day after the occurrence thereof if only clause (a) under the definition of Letter of Credit Default applies). In all cases, the costs and expenses (including but not limited to the reasonable costs and expenses of Buyer) of establishing, renewing, substituting, canceling, and increasing the amount of a Letter of Credit shall be borne by Seller. 7. Exercise of Rights Against Alternative Credit Support. In the event that (i) a Seller Default has occurred and is continuing or (ii) an Early Termination Date has occurred or been designated as a result of a Seller Default, Buyer may exercise any one or more of the rights and remedies provided under the Agreement or as otherwise available under applicable law. Without limiting the foregoing, if at any time (i) a Seller Default has occurred and is continuing, or (ii) an Early Termination Date occurs or is deemed to occur as a result of a Seller Default, then Buyer may, in its sole discretion, exercise any one or more of the following rights and remedies: (a) all rights and remedies available to a secured party under the Uniform Commercial Code of New York and any other applicable jurisdiction and other applicable laws with respect to the Alternative Credit Support held by or for the benefit of Buyer; (b) the right to set off any Alternative Credit Support held by or for the benefit of Buyer against and in satisfaction of any amount payable by Seller in respect of any of its obligations under the Agreement; or (c) the right to draw on any outstanding Letter of Credit issued for its benefit. D-3

214 8. Encumbrance; Grant of Security Interest. Seller pledges, assigns, conveys and transfers to Buyer, and hereby grants to Buyer a present and continuing security interest in and to, and a general first lien upon, all Alternative Credit Support which has been or may in the future be transferred to, or received by, the Buyer or the Custodian under Paragraph 2 of this Exhibit D, and all dividends, interest, and other proceeds from time to time received, receivable or otherwise distributed in respect of, or in exchange for, any or all of the foregoing and Seller agrees to take such action as Buyer reasonably requests in order to perfect the Buyer s continuing security interest in, and lien on, such Alternative Credit Support. 9. Further Actions. Seller agrees that from time to time Seller will promptly execute and deliver all further instruments and documents, and take all further action, that may be necessary or desirable, or that Buyer may reasonably request, in order to perfect and protect the security interest granted or purported to be granted hereby or to enable Buyer to exercise and enforce its rights and remedies hereunder with respect to the Alternative Credit Support. D-4

215 Schedule 1 to Exhibit D Form of Letter of Credit WE HEREBY ESTABLISH OUR IRREVOCABLE STAND-BY LETTER OF CREDIT NO. IN FAVOR OF: SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY Attn: Phone: Telex: BY ORDER AND FOR THE ACCOUNT OF: (insert full style and address) FOR AN AMOUNT OF: US DOLLARS (UNITED STATES DOLLARS ) AVAILABLE FOR PAYMENT AT SIGHT UPON PRESENTATION AT OUR COUNTERS IN (insert city and country where documents are to be presented) OF THE FOLLOWING DOCUMENT: STATEMENT SIGNED BY A PURPORTEDLY AUTHORIZED REPRESENTATIVE OF SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY CERTIFYING THAT J. ARON AND COMPANY HAS NOT PERFORMED IN ACCORDANCE WITH THE TERMS OF AN AGREEMENT(S) BETWEEN J. ARON AND COMPANY AND SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY AND THE AMOUNT BEING DRAWN OF USD DOES NOT EXCEED THAT AMOUNT WHICH SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY IS ENTITLED TO DRAW. SPECIAL CONDITIONS: 1. PARTIAL AND MULTIPLE DRAWINGS ARE PERMITTED. 2. ALL CHARGES RELATED TO THIS LETTER OF CREDIT ARE FOR OPENER S ACCOUNT. 3. DOCUMENTS MUST BE PRESENTED NOT LATER THAN (insert expiry date) OR IN THE EVENT OF FORCE MAJEURE INTERRUPTING OUR BUSINESS, WITHIN THIRTY (30) DAYS AFTER RESUMPTION OF OUR BUSINESS, WHICHEVER IS LATER. UPON RECEIPT OF DOCUMENTS ISSUED IN COMPLIANCE WITH THE TERMS OF THIS CREDIT, WE HEREBY IRREVOCABLY UNDERTAKE TO COVER YOU AS PER YOUR INSTRUCTIONS WITH VALUE ONE BANK WORKING DAY. THIS STANDBY CREDIT IS SUBJECT TO THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS (1993 REVISION), I.C.C. PUBLICATION 500. [Name of Issuing Bank] D-5

216 EXHIBIT E NOMINATING AGENT AND GAS SUPPLY CONTRACT (Attached) E-1

217 EXHIBIT F FORM OF REMARKETING NOTICE Date: To: J. Aron & Company Scheduling From: Southern California Public Power Authority This notice is delivered pursuant to that certain Amended and Restated Prepaid Natural Gas Sales Agreement (the Prepaid Agreement ) dated October 3, 2007[ ], 2013 by and between J. Aron & Company and Southern California Public Power Authority. Capitalized terms are defined in the Prepaid Agreement. Check the box to indicate type of Remarketing Notice : Monthly Remarketing Notice: Month(s) for which remarketing is requested:, 20 through, 20. Pursuant to Section 7.1 of the Prepaid Agreement, Buyer requests that Seller remarket in such Month(s) the following Daily Contract Quantities of Gas most recently nominated for delivery at the following respective Delivery Points: Delivery Point MMBtu/Day Daily Remarketing Notice: Gas Day(s) for which remarketing is requested:, 20 through, 20. Pursuant to Section 7.2 of the Prepaid Agreement, Buyer requests that Seller remarket on such Gas Days the following Daily Contract Quantities of Gas most recently nominated for delivery at the following respective Delivery Points: Delivery Point MMBtu/Gas Day F-1

218 Submitted by Buyer: Southern California Public Power Authority By: Name: Title: F-2

219 Summary Report: Litéra Change-Pro TDC Document Comparison done on 7/30/2013 8:09:19 PM Style Name: Default Style Original DMS:iw://AODMS/SUTHERLAND/ /1 Modified DMS: iw://aodms/sutherland/ /7 Changes: Add 336 Delete 299 Move From 37 Move To 37 Table Insert 0 Table Delete 0 Embedded Graphics (Visio, ChemDraw, Images etc.) 0 Embedded Excel 0 Format Changes 0 Total Changes: 709

220 [This Page Intentionally Left Blank]

221 Annex III FORM OF AMENDED RECEIVABLES PURCHASE AGREEMENT III-1

222 COMPOSITE EXECUTION VERSION INCORPORATING 10/2009 AMENDMENT Sutherland draft dated 30 July 2013 AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT among J. ARON & COMPANY and U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE and SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY Dated as of October 3, 2007 Dated as of [ ], 2013

223 Sutherland draft dated 30 July 2013 TABLE OF CONTENTS Article I ARTICLE I DEFINITIONS...1 Section 1.1 Definitions...1 Article II PURCHASE OF RECEIVABLES...35 Section 2.1 Conditions of Sale...35 Section 2.2 Sale and Transfer of Accounts Receivable...47 Section 2.3 Purchase Price...57 Section 2.4 Payment...57 Section 2.5 Further Assurances...57 Section 2.6 Instructions to Project Participants...58 Section 2.7 Taxes and Assessments...58 Article III REPRESENTATIONS AND WARRANTIES...59 Section 3.1 Representations of SCPPA and J. Aron...59 Section 3.2 Additional Representations and Warranties of SCPPA Section 3.3 Representations and Warranties of Trustee Section 3.4 Additional Representations and Warranties of J. Aron...11 Section Survival of Representations and Warranties Article IV CALL RECEIVABLES...11 Section 4.1 J. Aron Call Option...11 Section 4.2 Sale and Transfer of Call Identified Receivables...12 Section 4.3 Call Purchase Price...13 Section 4.4 Payment of Purchase Price...13 Section 4.5 Instructions to Project Participants...13 Section 4.6 Further Assurances...13 Section 4.7 Taxes and Assessments...13 Section 4.8 Interest...13 Section 4.9 Statements of Payments...14 Section 4.10 Enforcement of Remedies...14 Section 4.11 Excess Payments...14 Article V REPURCHASE OF RECEIVABLES...15 Section 5.1 Repurchase of Identified Receivables...15 i

224 Section 5.2 Repurchase and Transfer of Identified Receivables...15 Section 5.3 Repurchase Price...15 Section 5.4 Payment of Repurchase Price...15 Section 5.5 Instructions to Project Participants...15 Section 5.6 Further Assurances...16 Article VI MISCELLANEOUS Section Limitation on SCPPA Liability Section Amendment and Modification Section Notices Section Assignment Section Governing Law; Jurisdiction Section Counterparts Section Severability Section Entire Agreement Section Certain Rules of Construction Section No Strict Construction Section Waivers; Remedies Section 6.12 Waiver of Defenses...19 Section Section Headings Section No Attorney Fees; Representation by Counsel EXHIBIT A Form of Bill of Sale (Put Option Purchase) EXHIBIT B Form of Bill of Sale (Call Option Purchase) EXHIBIT C Form of Bill of Sale (Repurchase) ii

225 AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT This Amended and Restated Receivables Purchase Agreement (this Agreement ), dated and effective as of October 3[ ], (the Effective Date ) is by and among U.S. Bank National Association, a national banking association, in its capacity as Trustee under the Trust Indenture (defined below) ( Trustee ), J. Aron & Company, a New York general partnership ( J. Aron ), and Southern California Public Power Authority, a joint powers agency and a public entity organized under the laws of the State of California ( SCPPA ). Each of Trustee, J. Aron and SCPPA are individually referred to as a Party, and collectively as the Parties. RECITALS: WHEREAS, the Trust Indenture (defined below) provides thatfor the Trustee mayto sell to J. Aron, under certain circumstances, the Receivables (defined below) owed by the Project Participants under their respective Gas Supply Contracts; and WHEREAS, J. Aron desires to purchase the Receivables from Trustee under such circumstances as described below, upon the terms and conditions hereinafter set forth.; and WHEREAS, the Parties desire to amend and restate the Receivables Purchase Agreement dated October 3, 2007, by and among J. Aron, SCPPA and the Trustee, as herein provided; NOW, THEREFORE, in consideration of the premises above and the mutual covenants and agreements herein set forth, the Parties agree as follows: ARTICLE I DEFINITIONS Section 1.1 Section 1.1 Definitions. The following terms shall have the meanings ascribed to them in this Section 1.1. Capitalized terms used in this Agreement and not otherwise defined shall have the meanings ascribed to them in the Trust Indenture (defined below). Any reference herein to any agreement or document includes all amendments, supplements or restatements to and of such agreement or document as may occur from time to time. Affiliate means, with respect to any Party, any entity which is a direct or indirect parent or subsidiary of such Party or which directly or indirectly (i) owns or controls such Party, (ii) is owned or controlled by such Party, or (iii) is under common ownership or control with such Party. For purposes of this definition, control of an entity means the power, directly or indirectly, either to (a) vote 50% of more of the securities having ordinary voting power for the election of directors or Persons performing similar functions or (b) direct or cause the direction of the management and policies, whether by contract or otherwise. Average Daily Call Receivables Balance has the meaning specified in Section 4.8. Average Daily Put Receivables Balance has the meaning specified in Section

226 Bill of Sale means the bill of sale in substantially the form attached to the Agreement as Exhibit A, Exhibit B, or Exhibit C as the context requires. Buyer Swap means the ISDA Master Agreement, schedule and separate confirmations related to each Project Participant dated of even date herewith by and between SCPPA and AIG- FP Broadgate Limitedthe Commodity Swap Counterparty. Call Identified Receivables has the meaning specified in Section 4.1(b). Call Option Notice has the meaning specified in Section 4.1(b). Call Receivable means, as of any date with respect to any Project Participant, the right of SCPPA to collect, receive, and retain the net amount then owed by such Project Participant to SCPPA under the Gas Supply Contract between SCPPA and such Project Participant (excluding any amounts owed by such Project Participant related to indemnities or credit support), together with any right to payment of interest with respect thereto. For the avoidance of doubt, the term Call Receivable shall not include rights to any amounts due from a Project Participant that are not part of the Trust Estate. Call Receivables Amount has the meaning specified in Section 4.1(a). Call Receivables Offer has the meaning specified in Section 4.1(a). Collateral Agency Agreement means the Collateral Agency Agreement of even date herewith, dated as of October 3, 2007, between SCPPA and the Collateral Agent. Collateral Agent means U.S. Bank National Association, a national banking association, in its capacity as Collateral Agent under the Collateral Agency Agreement. Custodial Agreement means the Custodial Agreement of even date herewith among J. Aron, the Trustee, the Custodian and the Commodity Swap Counterparty. Custodian means U.S. Bank National Association, a national banking association, in its capacity as custodian under the Custodial Agreement. Debt Service Account Deficiency means, with respect to any Specified Project Participant and any Monthly Funding Date, the amount (if any) by which (i) funds required to be transferred into the Debt Service Account from the Revenue Fund Account of such Specified Project Participant pursuant to Section 5.09(c) of the Trust Indenture on such Monthly Funding Date, exceeds (ii) funds actually transferred or available to be transferred into such Debt Service Account from the Revenue Fund Account of such Specified Project Participant pursuant to Section 5.09(c) of the Trust Indenture on such Monthly Funding Date. Deficiency means, as of any date and with respect to any Project Participant, the amount (if any) by which the Funded Amount related to such Project Participant exceeds the then-current balance of the Working Capital Account related to such Project Participant. 2

227 Effective Date has the meaning specified in the preamble to this Agreement. Encumbrance means any lien, pledge, hypothecation, charge, security interest, conditional sale, right of refusal or any other adverse claim or interest having the practical effect of any of the foregoing. Final Maturity Date has the meaning specified in Section 2.1(b). Funded Amount means, with respect to any Project Participant, the amount that iswas initially funded into the Working Capital Account related to such Project Participant upon SCPPA s receipt of the bond proceeds under the Trust Indenture. Government Agency means the United States of America, any state thereof, or any local jurisdiction, or any political subdivision of any of the foregoing including, but not limited to courts, administrative bodies, departments, commissions, boards, bureaus, agencies, municipalities or other instrumentalities. Identified Receivables has the meaning specified in Section 2.1(a)means Put Identified Receivables or Call Identified Receivables, as applicable. J. Aron has the meaning specified in the preamble to this Agreement. Law means any statute, law, rule or regulation or any judicial or administrative interpretation thereof having the effect of the foregoing imposed by a Government Agency whether in effect as of the Effective Date or at any respective time in the future. Monthly Funding Date means the date in any month on or before which funds are required to be transferred from the Revenue Fund Account related to a Specified Project Participant to the Debt Service Account pursuant to Section 5.05(a)(ii) of the Trust Indenture. Party and Parties have the meanings specified in the preamble to this Agreement. Person means any individual, corporation (including any nonprofit corporation), general or limited partnership, limited liability partnership, limited liability company, joint venture, estate, trust, association, labor union or other entity or Government Agency. Purchase Date has the meaning specified in Section 2.2. Prime Rate means the fluctuating rate per annum equal to the Prime Rate listed daily in the Money Rate section of The Wall Street Journal, or if The Wall Street Journal is not published on a particular Business Day, then, the prime rate in the United States published in any other national financial journal or newspaper selected by the Trustee, and if more than one such rate is listed in the applicable publication, the highest rate shall be used; any change in the Prime Rate shall take effect on the date of publication of such change. Purchase Date means, (a) in the case of a sale pursuant to Section 2.1, the first Business Day after delivery of the Put Option Notice of such sale, or (b) in the case of a sale 3

228 pursuant to Section 4.1, the purchase date specified in the Call Option Notice for such sale delivered in accordance with Section 4.1(b). Purchase Price has the meaning specified in Section 2.3. Put Identified Receivables has the meanings specified in Section 2.1. Put Option Notice has the meaningmeanings specified in Section 2.1(a). Receivable means, as of any date and with respect to any Project Participant, the net amount then owed by such Project Participant to SCPPA under the Gas Supply Contract between SCPPA and such Project Participant for Gas that the Project Participant has taken or was required to take prior to such date, together with any right to payment of interest with respect thereto. For the avoidance of doubt, (i) the term Receivable shall not include any amounts due from a Project Participant under a Gas Supply Contract other than as identified in the preceding sentence, and (ii) in determining the net amount of any Receivable, undisputed amounts owed to such Project Participant under the Gas Supply Contract shall be deducted. Repurchase Date has the meaning specified in Section 5.1. Repurchase Notice has the meaning specified in Section 5.1. Repurchase Price has the meaning specified in Section 5.3. SCPPA has the meaning specified in the preamble to this Agreement. Specified Project Participant means any of the following Project Participants: the City of Burbank, California, the City of Colton, California, and the City of Pasadena, California. Swap Payment Deficiency with respect to any Project Participant means, as of any date in any month on which Revenues are to be applied in accordance with Section 5.05 of the Trust Indenture, (a) the Commodity Swap Payment in respect of the Commodity Swap applicable to such Project Participant that is currently due or that will become due for such month, minus (b) the amount of any funds on deposit in (or to be transferred on such date to) the Commodity Swaps Operating Account for such Project Participant, minus (c) the balance of such Project Participant s Working Capital Subaccount; provided, however, that if such difference is a negative number, then such Swap Payment Deficiency shall be zero. Tax means any federal, state, local or foreign taxes, profit, franchise (including without limitation those that are based on net worth, capitalization, income or total assets), sales, use, transfer, real property transfer, recording, payroll, employment, excise, withholding, social security (or similar), unemployment, disability, registration, alternative or add-on minimum, estimated, capital stock, value added, real or personal property or other taxes, assessments, fees, levies, duties (including without limitation customs duties and similar charges), deductions or other charges of any nature whatsoever (including without limitation interest and penalties) imposed by any Law, rule or regulation due and owing by SCPPA. 4

229 Terminated Participant has the meaning specified in Section 2.1(a). Trustee has the meaning specified in the preamble to this Agreement. Trust Indenture means the Amended and Restated Trust Indenture to be entered into as of October 1, 2007, dated as of the date hereof, between SCPPA and the Trustee, as supplemented and amended from time to time in accordance with its terms. Trustee has the meaning specified in the preamble to this Agreement. ARTICLE II PURCHASE OF RECEIVABLES Section 2.1 Section 2.1 Conditions of Sale. The Trustee shall sell to J. Aron, and J. Aron shall purchase, certain Receivables under the following circumstances: (a) (a) Exercise of Put Option Upon Early Termination of Gas Purchase Agreement. If (i) one or more Gas Purchase Agreements are terminated in accordance with Article XVII thereof, (ii) funds available to SCPPA and the Trustee on the Early Termination Payment Date pursuant to the Trust Indenture, the affected Gas Purchase Agreements (including any Termination Payments (as defined in the Gas Purchase Agreements) due from J. Aron) and the affected Gas Supply Contracts are or (as calculated by the Trustee) will be insufficient to pay the Bondholders the Redemption Price for the Bonds to be redeemed in accordance with the Trust Indenture on account of such termination, and (iii) a Deficiency exists with respect to any Terminated Participant (as defined below), then the Trustee shall have the right and is authorized and directed under the Trust Indenture to put to J. Aron, and J. Aron shall purchase, sufficient Receivables of any such Project Participant that was receiving Gas by way of the terminated Gas Purchase Agreement referenced in clause (i) (each, a Terminated Participant ) up to an aggregate amount equal to (as of the Early Termination Payment Date) the least of (x) the additional amount necessary to pay the Redemption Price of and accrued and unpaid interest on such Bonds, (y) the sum of the Deficiencies for all such Terminated Participants with positive Deficiencies, and (z) the total amount of Receivables then owed by all such Terminated Participants with a positive Deficiency less any undisputed amounts owed by SCPPA to each such Terminated Participant. The Trustee shall exercise its put option by delivering notice (thea Put Option Notice ) to J. Aron (with a copy to SCPPA) on or before the earliest applicable Early Termination Payment Date. The Put Option Notice shall include a description of the Receivables to be sold to J. Aron, including the relevant Project Participant, aging information and face amount (the Put Identified Receivables ). (b) (b) Exercise of Put Option on the Put Option DateUpon Final Maturity of Bonds. If on November 1, 2035 (referred to herein as the Put Option Date ) (i) funds available to SCPPA and the Trustee pursuant to the Trust Indenture, the Gas Purchase Agreements and the Gas Supply Contracts are or (as calculated by the Trustee) will be insufficient to pay the Bondholders on (and after) the Put Option Date the principal and accrued and unpaid interest due in accordance with the Trust Indenture, and (ii) a Deficiency exists with respect to any Project Participant immediately prior to the Put Option Date, then the Trustee shall have the right and is 5

230 authorized and directed under the Trust Indenture to put to J. Aron, and J. Aron shall purchase, sufficient Identified Receivables of such Project Participant up to an aggregate amount equal to (as of the Put Option Date) the least of (x) the additional amount necessary to pay the Bondholders on (and after) the Put Option Date the principal and accrued interest due, (y) the sum of the Deficiencies for all such Project Participants with positive Deficiencies, and (z) the total amount of Receivables then owed by all such Project Participants with a positive Deficiency less any undisputed amounts owed by SCPPA to each such Project Participant. The Trustee shall exercise its put option by delivering thenotice (a Put Option Notice ) to J. Aron (with a copy to SCPPA) on or before the Business Day (as defined in the Trust Indenture) next preceding the Put Option Date. The Put Option Notice shall include a description of the Identified Receivables in the manner described in Section 2.1(a) ( Put Identified Receivables ). (c) (c) Exercise of Put Option Upon Notice of Early Termination of a Buyer Swap. If SCPPA receives notice that a Buyer Swap is subject to termination due to aswap Payment Deficiency. If a Swap Payment default by SCPPA and, at the time, a Deficiency exists within respect toof any Specified Project Participant who is in default under its Gas Supply Contractexists or is projected to exist, the Trustee shall have the right and is authorized and directed under the Trust Indenture to put to J. Aron, and J. Aron shall purchase, sufficient Identified Receivables that are past due from such Specified Project Participant (as determined in accordance with Article XIV of the Gas Supply Contract for such Specified Project Participant) up to an aggregate amount sufficient to cure SCPPA s payment default under such Buyer Swapthe Swap Payment Deficiency with respect to such Specified Project Participant. The Trustee shall exercise its put option by a notice (a Put Option Notice ) to J. Aron (with a copy to SCPPA) no later than ten (10) Business Days prior to the end of the 45-daySwap Replacement Period for such Buyer Swap contemplated(as defined in the Gas Purchase AgreementAgreements) for the Buyer Swap related to such Buyer SwapSpecified Project Participant; provided that (i) the Purchase Date for such Identified Receivables shall be a date designated by J. Aron that is no later than five (5) Business Days prior to the end of such 45- dayswap Replacement Period, and (ii) only as it relates to this Section 2.1(c), J. Aron's obligation to purchase such Identified Receivables will be excused if suchan "Early Termination Date" (as defined in the Gas Purchase Agreement has been terminated for any reason (or notice to terminate such Gas Purchase Agreement for any reason has been provided)that specifies such Specified Project Participant) has occurred, has been designated, or has been conditionally designated, in any case prior to such Purchase Date. The Put Option Notice shall include a description of the Identified Receivables in the manner described in Section 2.1(a) ( Put Identified Receivables ). (d) Exercise of Put Option on Monthly Funding Dates. If, in respect of any Monthly Funding Date and Specified Project Participant, there exists a Debt Service Account Deficiency, then the Trustee shall have the right to put to J. Aron, and J. Aron shall purchase, Receivables that are due from such Specified Project Participant (as determined in accordance with Article XIV of the Gas Supply Contract for such Specified Project Participant) up to an aggregate amount equal to such Debt Service Account Deficiency. The Trustee shall exercise its put option by a notice (a Put Option Notice ) to J. Aron (with a copy to SCPPA) no later than the relevant Monthly Funding Date to which such Debt Service Account Deficiency relates. The Put Option Notice shall include a description of the Receivables in the manner described in Section 2.1(a) ( Put Identified Receivables ). 6

231 (e) The Trustee shall, not later than the dates set forth below, deliver to the Custodian written notice as follows: (i) on any Business Day on which the Trustee delivers a Put Option Notice in respect of any Project Participant pursuant to Section 2.1(c) of this Agreement, written notice that a Swap Payment Deficiency exists with respect to a Project Participant and the amount of Receivables to be sold to J. Aron; and (ii) on any Business Day on which the Trustee delivers a Put Option Notice in respect of any Project Participant pursuant to Section 2.1(d) of this Agreement, written notice that a Debt Service Account Deficiency exists with respect to a Project Participant and the amount of Receivables to be sold to J. Aron. Section 2.2 Section 2.2 Sale and Transfer of Accounts Receivable. Except as otherwise set forth in Section 2.1(c), on the first Business Day after delivery of the Put Option Notice to J. Aron described in Section 2.1 (the Purchase Date ) for Put Identified Receivables, the Trustee shall sell, transfer, assign, convey and deliver unto J. Aron, free and clear of all Encumbrances, all of SCPPA s and the Trustee s right, title and interest in and to the Put Identified Receivables. J. Aron s obligation to purchase the Put Identified Receivables shall be subject to the following conditions precedent being satisfied on the Purchase Date: (a) (a) The Trustee and SCPPA shall have delivered to J. Aron an executed Bill of Sale evidencing the sale of the Put Identified Receivables in the form of Exhibit A hereto; (b) (b) The representation and warranty of the Trustee in Article III shall be true and correct in all material respects, and J. Aron shall have received a certificate from the Trustee s authorized officer certifying to such effect; and (c) (c) The representations and warranties of SCPPA in Article III shall be true and correct in all material respects, and J. Aron shall have received a certificate from SCPPA s authorized officer certifying to such effect. Section 2.3 Section 2.3 Purchase Price. The consideration for the Put Identified Receivables sold to J. Aron (the Purchase Price ) shall be equal to the full face amount of all such Receivables, less any undisputed amounts owed to the applicable Project Participants under their respective Gas Supply Contracts. Section 2.4 Section 2.4 Payment. J. Aron shall pay the Purchase Price to the Trustee not later than the Purchase Date by wire transfer of immediately available funds to an account or accounts designated by the Trustee in the Put Option Notice. Section 2.5 Section 2.5 Further Assurances. The Trustee and SCPPA hereby agree to perform, execute or deliver, or cause to be performed, executed or delivered, such further acts, assurances and instruments as are necessary to complete or perfect the conveyance and transfer to J. Aron of all of SCPPA s and the Trustee s right, title and interest in and to the Put Identified Receivables free and clear of any and all Encumbrances consistent with this Agreement, and to do any and all such further acts and things as are necessary to effect completely the intent of this Agreement, including, but not limited to, directing the Project Participants to pay all Put 7

232 Identified Receivables directly to J. Aron after the Purchase Date. If any such amounts are paid to the Trustee or SCPPA with respect to ana Put Identified Receivable, the Trustee or SCPPA shall promptly pay over any such receipts to J. Aron. Section 2.6 Section 2.6 Instructions to Project Participants. No later than the Purchase Date, the Trustee and SCPPA shall irrevocably direct each relevant Project Participant in writing to pay the Put Identified Receivables to J. Aron pursuant to payment instructions to be supplied by J. Aron, and shall copy J. Aron on all such directions. SCPPA shall provide all documentation reasonably requested by J. Aron to support the calculation of any Put Identified Receivable and, upon request by J. Aron, SCPPA shall exercise commercially reasonable efforts to assist J. Aron in collecting any Put Identified Receivable. Section 2.7 Section 2.7 Taxes and Assessments. Notwithstanding anything to the contrary set forth herein, as between SCPPA and J. Aron, SCPPA shall be solely responsible for reporting and payment of all Taxes due or owing by SCPPA with respect to transactions under the Gas Supply Contracts (including Gas delivered thereunder) prior to the Purchase Date. Section 2.8 Interest. On the first day of each month, an interest amount shall be calculated with respect to each Project Participant equal to the Prime Rate plus three hundred (300) basis points per annum calculated on a 30/360 day basis multiplied by the Average Daily Put Receivables Balance for such Project Participant during the prior month. SCPPA shall pay or cause to be paid to J. Aron such accrued interest with respect to each Project Participant in accordance with the terms of the Trust Indenture solely from and to the extent of money in the account bearing the name of such Project Participant in the General Fund and in accordance with Section 5.10(a) of the Trust Indenture. The Average Daily Put Receivables Balance for any Project Participant during any month means the sum (but in no event less than zero) of (a) the cumulative interest accrued (whether paid or unpaid) with respect to Put Identified Receivables related to such Project Participant pursuant to this Section 2.8 as of the first day of such month, and (b) the average of the following amount (which can be positive or negative) calculated for each calendar day of such month: (i) the cumulative Purchase Price of Put Identified Receivables related to such Project Participant paid from the date hereof to such day minus (ii) the cumulative amount of any payments received by J. Aron from such Project Participant and from the Trustee or SCPPA with respect to Put Identified Receivables from the date hereof to such day (including (i) interest payments and (ii) any interest credits pursuant to Section 2.11(ii)). Section 2.9 Statements of Payments. Within ten (10) Business Days after the end of each month during which any amounts are outstanding under this Agreement, J. Aron will deliver to the Trustee and SCPPA a statement setting forth each of the following as of the end of such month for each Project Participant: (a) the Purchase Price of each Put Identified Receivable of such Project Participant sold to J. Aron under this Agreement, (b) cumulative interest accrued with respect to such Put Identified Receivables pursuant to Section 2.8, and (c) the cumulative amount of all payments received by J. Aron from the applicable Project Participant and from the Trustee or SCPPA with respect to such Put Identified Receivables (including (i) interest payments and (ii) any interest credits pursuant to Section 2.11(ii)). 8

233 Section 2.10 Enforcement of Remedies. For as long as any amounts with respect to a Put Identified Receivable are owed to J. Aron under this Agreement, J. Aron shall have the right to pursue payment from the applicable Project Participant of such Put Identified Receivable and to enforce any remedies available to it against such Project Participant with respect to such Put Identified Receivable. Any Party may submit a request to the other Parties to discuss coordination of collection efforts with respect to a Project Participant. Upon receipt of such request, the Parties shall discuss in good faith coordination of collection efforts. Section 2.11 Excess Payments. If at any time J. Aron receives an amount from any source in respect of any Put Identified Receivable in excess of the Purchase Price of such Put Identified Receivable, such amount shall be applied as follows: (i) if such amount is identifiable as payment in respect of the principal amount owing in respect of such Put Identified Receivable, J. Aron shall remit such amount to the Trustee; and (ii) if such amount is not identifiable as payment in respect of the principal as aforesaid, such amount shall first be credited towards any unpaid interest due to J. Aron under Section 2.8 above in respect of the applicable Project Participant, and J. Aron shall remit to the Trustee any portion thereof in excess of any such interest. ARTICLE III REPRESENTATIONS AND WARRANTIES Section 3.1 Section 3.1 Representations of SCPPA and J. Aron. Each of SCPPA and J. Aron hereby represents and warrants to each other and (severally and not jointly) to the Trustee on the Effective Date and again on and as of theeach Purchase Date, and J. Aron represents to SCPPA and the Trustee as of each Repurchase Date, as follows: (a) (a) it is duly organized and validly existing under the Laws of the state in which it is organized, and has all requisite power and authority, corporate or otherwise, to enter into and to perform its obligations under this Agreement and to carry out the terms and conditions hereof and the transactions contemplated hereby; (b) (b) it has all requisite power and authority to conduct its business, to own its properties, if any, and to execute, deliver and perform its obligations under this Agreement; (c) (c) there is no litigation, action, suit, or proceeding pending (service of process against the applicable Party having been made) against such Party, before or by any Government Agency, which could reasonably be expected to materially and adversely affect the performance by such Party of its obligations under this Agreement or that questions the validity, binding effect or enforceability hereof; (d) (d) the execution, delivery and performance of this Agreement by such Party have been duly authorized by all necessary action on the part of such Party and do not require any approval or consent of any security holder of such Party or any holder (or any trustee for any holder) of any indebtedness or other obligation of such Party except to the extent it would not materially and adversely affect the transactions contemplated hereby; (e) (e) this Agreement has been duly executed and delivered on behalf of such Party by an authorized Person of such Party and constitutes the legal, valid and binding 9

234 obligation of such Party, enforceable against it in accordance with its terms, as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium and similar Laws affecting creditors rights generally and by general principles of equity; (f) (f) the execution, delivery and performance of this Agreement by such Party shall not violate any provision of any Law, rule, regulation, ordinance, city charter, order, writ, judgment, decree or other legal or regulatory determination applicable to it except to the extent it would not materially and adversely affect the transactions contemplated hereby; (g) (g) except to the extent, in each case under this clause (g), it would not materially and adversely affect the transactions contemplated hereby, the execution, delivery and performance by such Party of this Agreement, and the consummation of the transactions contemplated hereby, including the incurrence by such Party of its financial obligations under this Agreement, shall not result in any violation of any term of any contract or agreement applicable to it, or any of its charter, organizational laws or documents or regulatory provisions of any license, permit or franchise applicable to it, or of any determination or award of any arbitrator applicable to it, and shall not conflict with, or cause a breach of, or default under, any such term or result in the creation of any lien upon any of its properties or assets (except the lien of the BondTrust Indenture and the Collateral Agency Agreement); (h) (h) to the knowledge of such Party, no consent, approval, order or authorization of, or registration, declaration or filing with, or giving of notice to, obtaining of any license or permit from, or taking of any other action with respect to, any Government Agency is required in connection with the valid authorization, execution, delivery and performance by such Party of this Agreement or the consummation of any of the transactions contemplated hereby other than those that have been obtained; and (i) (i) it enters this Agreement as a bona-fide, arms-length transaction involving the mutual exchange of consideration. Section 3.2 Section 3.2 Additional Representations and Warranties of SCPPA. As a material inducement to entering into this Agreement, SCPPA hereby represents and warrants to J. Aron and the Trustee as of the Effective Date and again on and as of theeach Purchase Date as follows: (a) (a) Title. SCPPA has good title to all of the Identified Receivables free and clear of any and all Encumbrances, other than Encumbrances in favor of the Trustee under the Trust Indenture and the Collateral Agent under the Collateral Agency Agreement. Pursuant to the Trust Indenture, SCPPA has granted to the Trustee the right, power and authority to sell the Identified Receivables to J. Aron as set forth herein. (b) (b) Identified Receivables. All of the Identified Receivables are valid receivables arising from bona fide sales of goods or services in the ordinary course of business. (c) (c) Gas Supply Contracts. Each Gas Supply Contract relating to an Identified Receivable is a valid and binding obligation of SCPPA, enforceable against it in accordance with its terms, as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium and similar Laws affecting creditors rights generally 10

235 and by general principles of equity, is in full force and effect, and has not been amended or supplemented in any material manner or respect except as otherwise indicated to J. Aron. There are no breaches or defaults by SCPPA of any of its obligations under any such Gas Supply Contract other than those giving rise to the amounts owed by SCPPA to the Project Participants as set forth in the Put Option Notice, and the Put Option Notice reflects the full amount attributable to all such breaches or defaults. No other events have occurred that (with or without notice or lapse of time or both) would result in a breach or default by SCPPA under any such Gas Supply Contract. Section 3.3 Section 3.3 Representations and Warranties of Trustee. The Trustee warrants that on theeach Purchase Date it will have the right to convey and will transfer to J. Aron all rights to the Identified Receivable to the extent such rights were transferred to the Trustee, free and clear of any Encumbrances that may have arisen from any act or omission of the Trustee. EXCEPT FOR THE WARRANTIES EXPRESSLY MADE BY THE TRUSTEE IN THIS ARTICLE III, THE TRUSTEE HEREBY DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED. Section 3.4 Additional Representations and Warranties of J. Aron. As a material inducement to entering into this Agreement, J. Aron hereby represents and warrants to SCPPA and the Trustee on and as of each Repurchase Date as follows: (a) Title. J. Aron has good title to all of the Identified Receivables free and clear of any and all Encumbrances, other than Encumbrances in favor of the Trustee under the Trust Indenture and the Collateral Agent under the Collateral Agency Agreement. (b) Transfer. J. Aron has the right to convey and will transfer to Trustee all rights to the Identified Receivable to the extent such rights were transferred to J. Aron, free and clear of any Encumbrances that may have arisen from any act or omission of J. Aron. Section 3.5 Section 3.4 Survival of Representations and Warranties. The representations and warranties of the Parties set forth herein will survive the purchase of the Identified Receivables for a period of two hundred seventy (270) days from the Purchase Date. No Party will be liable with respect to any claim for a breach of a representation and warranty unless notice of such claim is provided to the breaching Party prior to the expiration of such survival period. ARTICLE IV CALL RECEIVABLES Section 4.1 J. Aron Call Option. J. Aron shall have an option to purchase certain Receivables from the Trustee as described in this Section 4.1. The Trustee shall notify J. Aron of its option and, if exercised by J. Aron, the Trustee shall sell to J. Aron and J. Aron shall purchase, Call Receivables as follows: (a) If a Swap Payment Deficiency in respect of any Project Participant other than a Specified Project Participant exists or is projected to exist on any Business Day, then on such Business Day the Trustee shall deliver a written offer (a Call Receivables Offer ) to sell to J. Aron sufficient Call Receivables (such amount, less any undisputed 11

236 amounts owed by SCPPA to such Project Participant under its Gas Supply Contract, the Call Receivables Amount ) to fund such Swap Payment Deficiency. Such Call Receivables Offer shall identify the relevant Project Participants and include aging information and the face amount of the corresponding Call Receivables. (b) No later than one Business Day following J. Aron s receipt of a Call Receivables Offer, J. Aron may elect to purchase the Call Receivables referenced in the Call Receivables Offer by delivering a written notice (a Call Option Notice ) to the Trustee of J. Aron s intent to purchase such Call Receivables (collectively, the Call Identified Receivables ). The Call Option Notice shall specify a Purchase Date that will be no later than the Payment Date (as defined in the Confirmations to the Buyer Swap) for the month in which J. Aron receives the Call Receivables Offer. If J. Aron does not deliver a Call Option Notice to the Trustee on or before the Business Day following J. Aron s receipt of a Call Receivables Offer, J. Aron will be deemed to have elected not to purchase the referenced Call Receivables. (c) In accordance with the Custodial Agreement and the Trust Indenture, the Trustee shall, not later than the dates set forth below, deliver to the Custodian written notice as follows: (i) on any Business Day on which the Trustee delivers a Call Receivables Offer in respect of any Project Participant to J. Aron pursuant to Section 4.1(a) of this Agreement, written notice that a Swap Payment Deficiency in respect of such Project Participant exists and the amount of such deficiency; (ii) on any Business Day on which J. Aron is required to make an election to purchase Call Receivables pursuant to Section 4.1(b) of this Agreement, written notice as to whether J. Aron has elected to purchase such Call Receivables and, if so, the Purchase Date for such Call Receivables; and (iii) if J. Aron has elected to purchase Call Receivables, on the Purchase Date therefor written notice that the Purchase Price therefor has been received by the Trustee in immediately available funds. Section 4.2 Sale and Transfer of Call Identified Receivables. On each Purchase Date for Call Identified Receivables, the Trustee shall sell, transfer, assign, convey and deliver unto J. Aron, free and clear of all Encumbrances, all of the Trustee s and SCPPA s right, title and interest in and to the Call Identified Receivables described in the applicable Call Option Notice. For the purposes of calculating the face value of each Call Identified Receivable, the face value shall be equal to 100% of each Call Identified Receivable. (a) Conditions Precedent to J. Aron s Obligation to Purchase. J. Aron s obligation to purchase Call Identified Receivables pursuant to Section 4.1 shall be subject to the following conditions precedent being satisfied on each Purchase Date: (i) The Trustee and SCPPA shall have delivered to J. Aron an executed Bill of Sale evidencing the sale of the Call Identified Receivables in the form of Exhibit B hereto; and 12

237 (ii) The representations and warranties of SCPPA in Article III shall be true and correct in all material respects, and J. Aron shall have received a certificate from SCPPA s authorized officer to such effect. (b) Conditions Precedent to the Trustee s Obligation to Sell. The Trustee s obligation to sell Call Identified Receivables pursuant to Section 4.2 shall be subject to the following conditions precedent being satisfied on each Purchase Date: (i) J. Aron shall have delivered to the Trustee and SCPPA an executed Bill of Sale evidencing the sale of the Call Identified Receivables in the form of Exhibit B hereto; and (ii) The representations and warranties of J. Aron in Article III shall be true and correct in all material respects, and the Trustee shall have received a certificate from J. Aron s authorized officer to such effect. Section 4.3 Call Purchase Price. The consideration for the Call Identified Receivables purchased by J. Aron shall equal the Call Receivables Amount specified in the applicable Call Option Notice (the Call Purchase Price ). Section 4.4 Payment of Purchase Price. J. Aron shall pay the Call Purchase Price to the Trustee not later than the applicable Purchase Date by wire transfer of immediately available funds to an account or accounts designated in writing by the Trustee in the Call Receivables Offer. Section 4.5 Instructions to Project Participants. No later than the applicable Purchase Date, the Trustee and SCPPA shall irrevocably direct each applicable Project Participant in writing to pay the applicable Call Identified Receivables to J. Aron pursuant to payment instructions to be supplied by J. Aron, and shall copy J. Aron on all such directions. SCPPA shall provide all documentation reasonably requested by J. Aron to support the calculation of any Call Identified Receivable and, upon request by J. Aron, SCPPA shall exercise reasonable efforts to assist J. Aron in collecting any Call Identified Receivable. Section 4.6 Further Assurances. The Trustee and SCPPA hereby agree to perform, execute or deliver, or cause to be performed, executed or delivered, such further acts, assurances and instruments as J. Aron may reasonably require to complete or perfect the conveyance and transfer to J. Aron of all of SCPPA s and the Trustee s right, title and interest in and to the Call Identified Receivables free and clear of any and all Encumbrances consistent with this Agreement, and to do any and all such further acts and things as may be reasonably necessary to effect completely the intent of this Agreement, including, but not limited to, directing the applicable Project Participants to pay all Call Identified Receivables directly to J. Aron after the applicable Purchase Date. If any amounts are paid to the Trustee or SCPPA by a Project Participant with respect to a Call Identified Receivable that has been sold in whole or in part to J. Aron under this Agreement, the Trustee or SCPPA shall promptly pay any such receipts to J. Aron. Section 4.7 Taxes and Assessments. Notwithstanding anything to the contrary in this Agreement, as between SCPPA and J. Aron, SCPPA shall be solely responsible for reporting 13

238 and payment of all Taxes due or owing by SCPPA with respect to transactions under the Gas Supply Contracts (including Gas delivered thereunder) and SCPPA shall indemnify J. Aron and its Affiliates for any such Taxes paid by J. Aron or its Affiliates. Section 4.8 Interest. On the first day of each month, an interest amount shall be calculated with respect to each Project Participant equal to the Prime Rate plus three hundred (300) basis points per annum calculated on a 30/360 day basis multiplied by the Average Daily Call Receivables Balance for such Project Participant during the prior month. SCPPA shall pay or cause to be paid to J. Aron such accrued interest with respect to each Project Participant in accordance with the terms of the Trust Indenture solely from and to the extent of money in the account bearing the name of such Project Participant in the General Fund and in accordance with Section 5.10(a) of the Trust Indenture. The Average Daily Call Receivables Balance for any Project Participant during any month means the sum (but in no event less than zero) of (a) the cumulative interest accrued (whether paid or unpaid) with respect to Call Identified Receivables related to such Project Participant pursuant to this Section 4.8 as of the first day of such month, and (b) the average of the following amount (which can be positive or negative) calculated for each calendar day of such month: (i) the cumulative Call Purchase Price of Call Identified Receivables related to such Project Participant paid from the date hereof to such day minus (ii) the cumulative amount of any payments received by J. Aron from such Project Participant and from the Trustee or SCPPA with respect to such Call Identified Receivables from the date hereof to such day (including (i) interest payments and (ii) any interest credits pursuant to Section 4.11(ii)). Section 4.9 Statements of Payments. Within ten (10) Business Days after the end of each month during which any amounts are outstanding under this Agreement, J. Aron will deliver to the Trustee and SCPPA a statement setting forth each of the following as of the end of such month for each Project Participant: (a) the Call Purchase Price of each Call Identified Receivable for such Project Participant sold to J. Aron under this Agreement, (b) cumulative interest accrued with respect to such Call Identified Receivables pursuant to Section 4.8, and (c) the cumulative amount of all payments received by J. Aron from the applicable Project Participant and from the Trustee or SCPPA with respect to such Call Identified Receivables (including (i) interest payments and (ii) any interest credits pursuant to Section 4.11(ii)). Section 4.10 Enforcement of Remedies. For as long as any amounts with respect to a Call Identified Receivable are owed to J. Aron under this Agreement, J. Aron shall have the right to pursue payment from the applicable Project Participant of such Call Identified Receivable and to enforce any remedies available to it against such Project Participant with respect to such Call Identified Receivable. Any Party may submit a request to the other Parties to discuss coordination of collection efforts with respect to a Project Participant. Upon receipt of such request, the Parties shall discuss in good faith coordination of collection efforts. Section 4.11 Excess Payments. If at any time J. Aron receives an amount from any source in respect of any Call Identified Receivable in excess of the Call Purchase Price of such Call Identified Receivable, such amount shall be applied as follows: (i) if such amount 14

239 is identifiable as payment in respect of the principal amount owing in respect of such Call Identified Receivable, J. Aron shall remit such amount to the Trustee; and (ii) if such amount is not identifiable as payment in respect of the principal as aforesaid, such amount shall first be credited towards any unpaid interest due to J. Aron under Section 4.8 above in respect of the applicable Project Participant, and J. Aron shall remit to the Trustee any portion thereof in excess of any such interest. ARTICLE V REPURCHASE OF RECEIVABLES Section 5.1 Repurchase of Identified Receivables. The Trustee and SCPPA shall have the right, on any day on which J. Aron has not been paid the full Repurchase Price (as defined below) for Identified Receivables that have been sold to J. Aron hereunder, to repurchase in whole or in part one or more Identified Receivables in accordance with this Section 5.1. The Trustee shall deliver notice to J. Aron setting forth the portion of the Identified Receivables to be repurchased by the Trustee or SCPPA (the Repurchase Notice ). The repurchase date for the Identified Receivables specified in the Repurchase Notice ( Repurchase Date ) shall be a date designated by the Trustee that is no later than 12:00 noon New York City time on the first Business Day following receipt of such Repurchase Notice. In the event that funds to be used to repurchase Identified Receivables are insufficient to repurchase all outstanding Identified Receivables, the Trustee shall use such funds to repurchase Identified Receivables in the order in which such Identified Receivables were sold to J. Aron under this Agreement, in minimum denominations of $1, Section 5.2 Repurchase and Transfer of Identified Receivables. On the Repurchase Date, J. Aron shall sell, transfer, assign, convey and deliver unto the Trustee, free and clear of all Encumbrances, all of J. Aron s right, title and interest in and to the portion of the Identified Receivables specified in the applicable Repurchase Notice. On the Repurchase Date, J. Aron shall deliver to the Trustee an executed Bill of Sale evidencing the repurchase of the applicable portion of the Identified Receivables in the form of Exhibit C hereto. Section 5.3 Repurchase Price. The consideration for the portion of the Identified Receivables identified in the Repurchase Notice to be repurchased by the Trustee or SCPPA (the Repurchase Price ) shall be equal to the Purchase Price for such portion of the Identified Receivables minus all payments received by J. Aron from the applicable Project Participant and from the Trustee with respect to such portion of the Identified Receivables. For the avoidance of doubt, the Repurchase Price for an Identified Receivable shall not be adjusted for the amount of any interest accrued from the Project Participant under the applicable Gas Supply Contract since the Purchase Date of such Identified Receivable. Section 5.4 Payment of Repurchase Price. The Trustee or SCPPA shall pay the Repurchase Price to J. Aron on the Repurchase Date by wire transfer of immediately available funds to an account or accounts designated by J. Aron. Section 5.5 Instructions to Project Participants. No later than the Repurchase Date, J. Aron shall irrevocably direct each applicable Project Participant in 15

240 writing to pay the Identified Receivables, to the extent such Identified Receivables are repurchased by the Trustee or SCPPA pursuant to this Article VI, to the Trustee pursuant to payment instructions to be supplied by the Trustee, and shall copy the Trustee on all such directions. If any such amounts are paid to J. Aron with respect to a portion of an Identified Receivable repurchased by the Trustee or SCPPA, J. Aron shall promptly pay over any such receipts to the Trustee without setoff of any kind. Section 5.6 Further Assurances. J. Aron hereby agrees to perform, execute or deliver, or cause to be performed, executed or delivered, such further acts, assurances and instruments as the Trustee may reasonably require to complete or perfect the conveyance and transfer to the Trustee of all of J. Aron s right, title and interest in and to the Identified Receivables repurchased by the Trustee or SCPPA free and clear of any and all Encumbrances consistent with this Agreement, and to do any and all such further acts and things as may be reasonably necessary to effect completely the intent of this Agreement, including, but not limited to, directing the applicable Project Participants to pay all Identified Receivables, to the extent such Identified Receivables are repurchased by the Trustee or SCPPA pursuant to this Article VII, directly to the Trustee after the Repurchase Date. ARTICLE VI MISCELLANEOUS Section 6.1 Section 4.1 Limitation on SCPPA Liability. (a) (a) SCPPA shall be obligated to observe and perform its obligations hereunder solely from and to the extent of the Trust Estate, as defined in the Trust Indenture, available to be applied for such purpose in accordance with the Trust Indenture, to which all recourse of J. Aron shall be limited. No provision of this Agreement shall require SCPPA to expend or risk any other funds or incur any other financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers. Anything in this Agreement to the contrary notwithstanding, the performance by SCPPA of all duties and obligations imposed upon it hereby, the exercise by it of all powers granted to it hereunder, the carrying out of all covenants, agreements, and promises made by it hereunder, and liability of SCPPA for all warranties and other covenants herein shall be limited solely to such Trust Estate; and SCPPA shall not be required to effectuate any of such duties, obligations, powers, or covenants except from, and to the extent of, such Trust Estate. Whether or not therein expressly so provided, every provision of this Agreement shall be subject to the provisions of this Section (a). Neither J. Aron nor any other beneficiary hereof shall have any right to demand payment or performance by SCPPA out of money raised or to be raised by taxation. (b) (b) No recourse under or upon any obligation, covenant, or agreement contained in this Agreement, or for any claim based thereon or otherwise in respect thereof, shall be had against any Project Participant, incorporator or any past, present, or future director, officer, employee, or agent or member of the governing body, as such, of any Party or its sponsor (including any Project Participant) or any successor, either directly or through such Party, whether by virtue of any constitution or statute or rule of Law, or by the enforcement of any assessment, judgment, or penalty, or otherwise; it being expressly understood that this 16

241 Agreement is solely a corporate obligation, and that no such personal liability whatever shall attach to, or is or shall be incurred by, the Project Participants, incorporators, directors, officers, employees, sponsor, or agents, as such, of such Party (including any Project Participant) or any successor, or any member of its governing body, or any of them, by reason of the obligations, covenants, or agreements contained in this Agreement or implied therefrom, and that any and all such personal liability either at common law or equity or by constitution or statute of, and any and all such rights and claims against, every such Project Participant, incorporator, member, director, officer, employee, sponsor, or Person, as such, are hereby expressly waived and released as a condition of, and in consideration for, the execution of this Agreement. Section 6.2 Section 4.2 Amendment and Modification. This Agreement may be amended, modified, terminated, rescinded or supplemented only by written agreement of all the Parties. Section 6.3 Section 4.3 Notices. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given when: (a) delivered personally; (b) sent by facsimile (with receipt confirmed), provided that a copy is mailed by registered or certified mail, return receipt requested; or (c) received by the addressee, if sent by Express Mail, Federal Express or other express delivery service (receipt requested) or by registered or certified mail, return receipt requested, in each case to the other Parties at the following addresses and facsimile numbers (or to such other address or facsimile number for a Party as shall be specified by like notice; provided that notices of a change of address or facsimile number shall be effective only upon receipt thereof): if to J. Aron, to: J. Aron & Company 85 Broad200 West Street New York, NY Facsimile No. (212) Attention: Margaret Vaden and to: J. Aron & Company 85 Broad200 West Street New York, NY Facsimile No. (212) Attention: Stanley PrestonJohn Thomas if to the Trustee, to: U.S. Bank National Association, as Trustee 633 West Fifth Street, 24 th Floor LM-CA-T24T Los Angeles, CA Attention: Corporate Trust Department Fax: (213)

242 if to SCPPA, to: Southern California Public Power Authority 225 South Lake Avenue, Suite Nicole Court PasadenaGlendora, CA Attention: Executive Director Fax: (626) Section 6.4 Section 4.4 Assignment. This Agreement and all of the provisions hereof shall be binding upon and inure to the benefit of the Parties hereto and their respective successors and permitted assigns, but neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by any of the Parties hereto without the prior written consent of the other Parties; provided, however, that J. Aron may and will assign this Agreement to any permitted assignee of J. Aron s entire interest in all of the Gas Purchase Agreements. Any assignment attempted in contravention of this Section shall be void ab initio. Section 6.5 Section 4.5 Governing Law; Jurisdiction. THIS AGREEMENT AND THE RIGHTS AND DUTIES OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO ANY CONFLICTS OF LAW PRINCIPLE THAT WOULD DIRECT THE APPLICATION OF ANOTHER JURISDICTION S LAW; PROVIDED THAT THE PROCEDURAL LAWS AND RULES OF EVIDENCE OF THE STATE OF CALIFORNIA AND THE LAWS OF THE STATE OF CALIFORNIA RELATING TO GOVERNMENTAL IMMUNITIES AND THE AUTHORITY OF SCPPA TO ENTER INTO AND PERFORM ITS OBLIGATIONS UNDER THIS AGREEMENT SHALL APPLY. ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY PARTY ARISING OUT OF OR RELATING HERETO SHALL BE BROUGHT EXCLUSIVELY IN THE COURTS OF THE STATE OF CALIFORNIA OR OF THE UNITED STATES OF AMERICA, IN EITHER CASE, LOCATED IN LOS ANGELES COUNTY CALIFORNIA. BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH PARTY, FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, IRREVOCABLY ACCEPTS GENERALLY AND UNCONDITIONALLY THE EXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS; WAIVES ANY DEFENSE OF FORUM NON CONVENIENS; AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THE PARTY AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH THIS AGREEMENT; AGREES THAT SERVICE AS PROVIDED ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER THE PARTY IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT. Section 6.6 Section 4.6 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same agreement. 18

243 Section 6.7 Section 4.7 Severability. Any term or provision of this Agreement which is invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective to the extent of such invalidity or unenforceability without rendering invalid or unenforceable the remaining terms and provisions of this Agreement or affecting the validity or enforceability of any of the terms or provisions of this Agreement in any other jurisdiction. If any provision of this Agreement is so broad as to be unenforceable, the provision shall be interpreted only so broadly as is enforceable. Section 6.8 Section 4.8 Entire Agreement. This Agreement and the Exhibit attached hereto, which are hereby made a part hereof, and the documents and instruments referred to herein constitute the entire agreement of the Parties with respect to the subject matter hereof. This Agreement supersedes all prior agreements and understandings between the Parties with respect to such subject matter. Section 6.9 Section 4.9 Certain Rules of Construction. (a) (a) The words hereof, herein and hereunder, and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not any particular provision of this Agreement. (b) (b) The word including and any other words or phrases of inclusion will not be construed as terms of limitation, so that references to included matters will be regarded as non-exclusive, non-characterizing illustrations. (c) (c) The terms defined in the singular shall have a comparable meaning when used in the plural, and vice versa. (d) (d) The terms defined in the neuter or masculine gender shall include the feminine, neuter and masculine genders, unless the context clearly indicates otherwise. Section 6.10 Section 4.10 No Strict Construction. Notwithstanding the fact that this Agreement has been drafted or prepared by one of the Parties, each of the Parties confirms that both it and its counsel have reviewed, negotiated and adopted this Agreement as the joint agreement and understanding of the Parties, and the language used in this Agreement shall be deemed to be the language chosen by the Parties hereto to express their mutual intent, and no rule of strict construction shall be applied against any person. Section 6.11 Section 4.11 Waivers; Remedies. The failure of any Party at any time or times to require performance of any provision of this Agreement will in no manner affect the right to enforce the same; and no waiver by any Party of any provision (or of a breach of any provision) of this Agreement, whether by conduct or otherwise, in any one of more instances will be deemed or construed either as a further or continuing waiver of any such provision or breach or as a waiver of any other provision (or of a breach of any other provision) of this Agreement. The remedies of a Party provided in this Agreement are cumulative and will not exclude any other remedies to which any Party may be lawfully entitled under this Agreement or applicable Law, and the exercise of a remedy will not be deemed an election excluding any other remedy (any such claim by any other Party being hereby waived). 19

244 Section 6.12 Waiver of Defenses. J. Aron waives all rights to set-off, counterclaim, recoupment and any other defenses that might otherwise be available to J. Aron with regard to J. Aron s obligations pursuant to the terms of this Agreement. Section 6.13 Section 4.12 Section Headings. The section headings contained in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement. Section 6.14 Section 4.13 No Attorney Fees; Representation by Counsel. Each Party acknowledges that it has been represented by counsel in negotiating and executing this Agreement. Both Parties hereto agree that in any action to enforce the terms of this agreement, each Party shall be responsible for its own attorneys fees and expenses. [Remainder of page intentionally left blank] 20

245 EXECUTED AND DELIVERED as of the Effective Date. J. ARON & COMPANY By: Name: Title: U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE By: Name: Title: SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY By: Name: Title: [Signature Page to Amended and Restated Receivables Purchase Agreement]

246 EXHIBIT A FORM OF BILL OF SALE (PUT OPTION PURCHASE) THIS BILL OF SALE dated effective as of the day of, (this Bill of Sale ) is executed and delivered by U.S. Bank National Association, a national banking association, as Trustee (the Trustee ), and by Southern California Public Power Authority, a joint powers agency and a public entity organized under the laws of the State of California ( SCPPA ), to J. Aron & Company, a New York general partnership ( J. Aron ). RECITALS WHEREAS, the Trustee desires to sell to J. Aron, on behalf of SCPPA, and J. Aron desires to purchase from the Trustee, the Put Identified Receivables, as such term is defined in the Amended and Restated Receivables Purchase Agreement by and among the Trustee, J. Aron and SCPPA, dated as of October 3, 2007, as amended[ ], 2013 (the Receivables Purchase Agreement ); and WHEREAS, any capitalized term used herein and not otherwise defined shall have the meaning ascribed to it in the Receivables Purchase Agreement.; AGREEMENT NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and pursuant to the authority granted by SCPPA to the Trustee in the Trust Indenture, the Trustee hereby sells, transfers, assigns, conveys and delivers unto J. Aron and its successors and assigns all of the Trustee s and SCPPA s right, title and interest in and to the Put Identified Receivables as set forth in the Put Option Notice attached hereto as Schedule 1 (the Assets ), free and clear of any and all Encumbrances other than Encumbrances under the Trust Indenture and the Collateral Agency Agreement.; TO HAVE AND TO HOLD unto J. Aron and its successors and assigns forever the Assets, together with, all and singular, the rights and appurtenances thereto in any way belonging to the Trustee or SCPPA; and each of Trustee and SCPPA does hereby agree to confirm to any other person the ownership of the Assets by J. Aron. A true and correct copy of the Put Option Notice is attached hereto as Schedule 1. This Bill of Sale shall be governed by and construed in accordance with Section of the Receivables Purchase Agreement. This Bill of Sale is executed and delivered pursuant to Section 2.2 of the Receivables Purchase Agreement, and is subject and subordinate to all of the terms and provisions of the Receivables Purchase Agreement. In the event of any conflict between any term or provision hereof and any term or provision of the Receivables Purchase Agreement, the latter shall control. This Bill of Sale shall be binding upon the Trustee and SCPPA and their respective successors and assigns, and shall inure to the benefit of J. Aron and its successors and assigns. A-1

247 This Bill of Sale may not be amended or altered except in a writing signed by each of the Trustee, SCPPA and J. Aron. This Bill of Sale may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. EXECUTED AND DELIVERED effective as of the date first written above. U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE By: Name: Title: SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY By: Name: Title: Accepted and Agreed by: J. ARON & COMPANY By: Name: Title: A-2

248 Schedule 1 to Bill of Sale Copy of Put Option Notice [Put Option Notice to be attached at the time the Bill of Sale is executed] A-3

249 EXHIBIT B FORM OF BILL OF SALE (CALL OPTION PURCHASE) THIS BILL OF SALE dated effective as of the day of, (this Bill of Sale ) is executed and delivered by U.S. Bank National Association, a national banking association, as Trustee (the Trustee ), and by Southern California Public Power Authority, a joint powers agency and a public entity organized under the laws of the State of California ( SCPPA ), to J. Aron & Company, a New York general partnership ( J. Aron ). RECITALS WHEREAS, the Trustee desires to sell to J. Aron, on behalf of SCPPA, and J. Aron desires to purchase from the Trustee, the Call Identified Receivables, as such term is defined in the Amended and Restated Receivables Purchase Agreement by and among the Trustee, J. Aron and SCPPA, dated as of [ ], 2013 (the Receivables Purchase Agreement ); and WHEREAS, any capitalized term used herein and not otherwise defined shall have the meaning ascribed to it in the Receivables Purchase Agreement; AGREEMENT NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and pursuant to the authority granted by SCPPA to the Trustee in the Trust Indenture, the Trustee hereby sells, transfers, assigns, conveys and delivers unto J. Aron and its successors and assigns all of the Trustee s and SCPPA s right, title and interest in and to the Call Identified Receivables as set forth in the Call Option Notice attached hereto as Schedule 1 (the Assets ), free and clear of any and all Encumbrances other than Encumbrances under the Trust Indenture; TO HAVE AND TO HOLD unto J. Aron and its successors and assigns forever the Assets, together with, all and singular, the rights and appurtenances thereto in any way belonging to the Trustee or SCPPA; and each of Trustee and SCPPA does hereby agree to confirm to any other person the ownership of the Assets by J. Aron. A true and correct copy of the Call Option Notice is attached hereto as Schedule 1. This Bill of Sale shall be governed by and construed in accordance with Section 6.5 of the Receivables Purchase Agreement. This Bill of Sale is executed and delivered pursuant to Section 4.2 of the Receivables Purchase Agreement, and is subject and subordinate to all of the terms and provisions of the Receivables Purchase Agreement. In the event of any conflict between any term or provision hereof and any term or provision of the Receivables Purchase Agreement, the latter shall control. B-1

250 This Bill of Sale shall be binding upon the Trustee and SCPPA and their respective successors and assigns, and shall inure to the benefit of J. Aron and its successors and assigns. This Bill of Sale may not be amended or altered except in a writing signed by each of the Trustee, SCPPA and J. Aron. This Bill of Sale may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. EXECUTED AND DELIVERED effective as of the date first written above. U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE By: Name: Title: SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY By: Name: Title: Accepted and Agreed by: J. ARON & COMPANY By: Name: Title B-2

251 Schedule 1 to Bill of Sale Copy of Call Option Notice [Notice to be attached at the time the Bill of Sale is executed] B-3

252 EXHIBIT C FORM OF BILL OF SALE (REPURCHASE) THIS BILL OF SALE dated effective as of the day of, (this Bill of Sale ) is executed and delivered by J. Aron & Company, a New York general partnership ( J. Aron ) to U.S. Bank National Association, a national banking association, as Trustee (the Trustee ). RECITALS WHEREAS, J. Aron desires to sell to the Trustee for the benefit of, and the Trustee desires to purchase from J. Aron on behalf of, Southern California Public Power Authority, a joint powers agency and a public entity organized under the laws of the State of California ( SCPPA ), the Call Identified Receivables (as such term is defined in the Amended and Restated Receivables Purchase Agreement by and among the Trustee, J. Aron and SCPPA, dated as of [ ], 2013 (the Receivables Purchase Agreement )) identified on Schedule 1 hereto; and WHEREAS, any capitalized term used herein and not otherwise defined shall have the meaning ascribed to it in the Receivables Purchase Agreement; AGREEMENT NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, J. Aron hereby sells, transfers, assigns, conveys and delivers unto the Trustee and its successors and assigns for the benefit of SCPPA all of J. Aron s right, title and interest in and to the Call Identified Receivables set forth in the Repurchase Notice attached hereto as Schedule 1 (the Assets ), free and clear of any and all Encumbrances, other than Encumbrances under the Trust Indenture; TO HAVE AND TO HOLD unto the Trustee and its successors and assigns forever on behalf of SCPPA the Assets, together with, all and singular, the rights and appurtenances thereto in any way belonging to J. Aron; and J. Aron does hereby agree to confirm to any other person the ownership of the Assets by the Trustee. A true and correct copy of the Repurchase Notice is attached hereto as Schedule 1. This Bill of Sale shall be governed by and construed in accordance with Section 6.5 of the Receivables Purchase Agreement. This Bill of Sale is executed and delivered pursuant to Section 5.2 of the Receivables Purchase Agreement, and is subject and subordinate to all of the terms and provisions of the Receivables Purchase Agreement. In the event of any conflict between any term or provision hereof and any term or provision of the Receivables Purchase Agreement, the latter shall control. C-1

253 This Bill of Sale shall be binding upon J. Aron and its successors and assigns, and shall inure to the benefit of the Trustee and its successors and assigns on behalf of SCPPA. This Bill of Sale may not be amended or altered except in a writing signed by each of the Trustee, SCPPA and J. Aron. This Bill of Sale may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. EXECUTED AND DELIVERED effective as of the date first written above. J. ARON & COMPANY By: Name: Title: Accepted and Agreed by: U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE By: Name: Title: SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY By: Name: Title: C-2

254 Schedule 1 to Bill of Sale Copy of Repurchase Notice [Repurchase Notice to be attached at the time the Bill of Sale is executed] C-3

255 Summary Report: Litéra Change-Pro TDC Document Comparison done on 7/30/2013 8:11:59 PM Style Name: Default Style Original DMS:iw://AODMS/SUTHERLAND/ /1 Modified DMS: iw://aodms/sutherland/ /10 Changes: Add 417 Delete 181 Move From 9 Move To 9 Table Insert 0 Table Delete 0 Embedded Graphics (Visio, ChemDraw, Images etc.) 0 Embedded Excel 0 Format Changes 0 Total Changes: 616

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257 Annex IV FORM OF AMENDMENT TO GOLDMAN SACHS GUARANTY IV-1

258 Sutherland draft of 7/30/2013 AMENDMENT TO GUARANTY THIS AMENDMENT TO GUARANTY (this Amendment ) is entered into as of [ ] 2013, by THE GOLDMAN SACHS GROUP, INC., a Delaware corporation ( Guarantor ), in favor of Southern California Public Power Authority (the Beneficiary ). RECITALS WHEREAS, Guarantor delivered to Beneficiary that certain Guaranty dated October 3, 2007 (the Guaranty ) related to the obligations of J. Aron & Company, a New York general partnership (the Company ) arising in connection with the Agreements (as defined in the Guaranty); WHEREAS, as an inducement to enter into certain new agreements, the Beneficiary requires that Guarantor amend the Guaranty to guarantee the Company s obligations under such agreements; and WHEREAS, Guarantor wishes to amend the Guaranty on the terms and conditions set forth in this Amendment; AGREEMENT NOW, THEREFORE, for and in consideration of the foregoing and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Guarantor hereby agrees as follows: 1. Amendment of Guaranty. The Guaranty is hereby amended by deleting Exhibit A in its entirety and replacing it with Exhibit A attached to this Amendment. 2. Miscellaneous. (a) Amendments. Except as modified by this Amendment, the Guaranty shall remain in full force and effect, notwithstanding any amendments made to the Agreements (as defined in the Guaranty) heretofore or by the agreements described in Exhibit A hereto or any other prior event or circumstance. Guarantor hereby affirms and confirms that all of its obligations and liabilities arising under the Guaranty and under that certain Side Letter related to the Guaranty dated as of October 3, 2007 between Guarantor and Beneficiary remain in full force and effect in favor of the Beneficiary and have not been modified or amended, except as set forth herein. (b) Representations and Warranties. Guarantor hereby makes the same representations and warranties to Beneficiary concerning this Amendment, and the Guaranty as amended hereby, as Guarantor made in the Guaranty. (c) No Third Party Beneficiaries. Nothing herein expressed or implied is intended or shall be construed to confer upon or give to any person or entity, other than the parties to this Amendment and each of their respective successors and permitted assigns, any rights or remedies under or by reason of this Amendment.

259 Sutherland draft of 7/30/2013 IN WITNESS WHEREOF, the Guarantor has executed this Amendment as of the date first above written. GUARANTOR: THE GOLDMAN SACHS GROUP, INC. By: Name: Title: [Signature Page to Amendment to SCPPA Guaranty]

260 Sutherland draft of 7/30/2013 ACCEPTED AND AGREED SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY By: Name: Title: [Signature Page to Amendment to SCPPA Guaranty]

261 Sutherland draft of 7/30/2013 EXHIBIT A Agreements The following agreements, as they may have been or may be amended or supplemented from time to time, shall collectively mean the Agreements : 1. The Amended and Restated Prepaid Gas Sales Agreement, dated as of [ ], 2013 by and between the Company and the Beneficiary, with the City of Anaheim as the initial Nominating Agent; 2. The Amended and Restated Prepaid Gas Sales Agreement, dated as of [ ], 2013 by and between the Company and the Beneficiary, with the City of Burbank as the initial Nominating Agent; 3. The Amended and Restated Prepaid Gas Sales Agreement, dated as of [ ], 2013 by and between the Company and the Beneficiary, with the City of Colton as the initial Nominating Agent; 4. The Amended and Restated Prepaid Gas Sales Agreement, dated as of [ ], 2013 by and between the Company and the Beneficiary, with the City of Glendale as the initial Nominating Agent; 5. The Amended and Restated Prepaid Gas Sales Agreement, dated as of [ ], 2013 by and between the Company and the Beneficiary, with the City of Pasadena as the initial Nominating Agent; 6. The Pricing Agreement, dated as of October 3, 2007, by and between the Company and the Beneficiary; 7. The Gas Scheduling Agreement, dated as of October 3, 2007, by and between the Company and the Beneficiary; 8. The ISDA Master Agreement, dated as of October 3, 2007, and related Confirmations (as defined therein) of even date therewith by and between the Company and the Beneficiary (the Interest Rate Swap ); 9. The Amended and Restated Receivables Purchase Agreement, dated as of [ ], 2013 by and among the Company, the Beneficiary and U.S. Bank National Association, a national banking association, as trustee (the Trustee ); and 10. The Investment Agreement, dated as of [ ], 2013, by and among the Company, the Beneficiary and the Trustee.

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264 In order to give a Consent, each Holder, or such Holder s broker, dealer, commercial bank, trust company or other nominee, should mail, hand deliver, send by overnight courier or facsimile (confirmed by physical delivery) a properly completed and duly executed Consent Form, and any other required documents, to the Information and Tabulation Agent at its address or facsimile number set forth below. Questions and requests for assistance or additional copies of this Consent Solicitation Statement, the Consent Form or related documents may be directed to the Information and Tabulation Agent at its address and telephone numbers listed below. A Holder may also contact the Solicitation Agent at its telephone number listed below or such Holder s broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Consent Solicitation. The Information and Tabulation Agent is: D.F. King & Co., Inc. 48 Wall Street, 22 nd Floor New York, New York By Facsimile (for Eligible Institutions only): (212) Confirmation by Telephone: (212) Attn: Elton Bagley [email protected] By Mail, Overnight or by Hand: 48 Wall Street, 22 nd Floor New York, New York Banks and Brokers call: (212) (collect) All others call: (800) (toll-free) The Solicitation Agent for the Consent Solicitation is: Wells Fargo Securities, LLC 550 South Tryon Street, 5 th Floor Charlotte, North Carolina Attn: Liability Management Group (704) (collect) (866) (toll free) Southern California Public Power Authority (SCPPA) may be contacted at: Southern California Public Power Authority 1160 Nicole Court Glendora, California Attn: Director of Finance & Accounting (626)