FIRST AMENDED AND RESTATED JOINT ACTION AGENCY AGREEMENT

 

                                                                       EXECUTION

 

 

 

                           FIRST AMENDED AND RESTATED

 

                          JOINT ACTION AGENCY AGREEMENT

 

 

 

 

                                   RELATING TO

 

 

 

                       THE ALASKA RAILBELT ENERGY AUTHORITY

 

 

 

 

 

 

 

 

 

 

                           Dated as of August 1, 2005

 

 

 

 

                                 ATER WYNNE LLP

 

 

 

<PAGE>

 

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

                          JOINT ACTION AGENCY AGREEMENT

                                 RELATING TO THE

                        ALASKA RAILBELT ENERGY AUTHORITY

 

--------------------------------------------------------------------------------

 

 

 

         THIS JOINT ACTION AGENCY AGREEMENT ("Agreement"), dated as of this

first day of August, 2005, by and among the Municipality of Anchorage d/b/a

Anchorage Municipal Light & Power (ML&P), Chugach Electric Association, Inc.

(Chugach), and Golden Valley Electric Association (GVEA) ("Initial Member

Utilities"):

 

                                   WITNESSETH:

 

         WHEREAS, pursuant to 42.45.300 of the Alaska Statutes, two or more

public utilities may form a joint action agency for the purpose of participation

in the design, construction, operation, and maintenance or removal of a

generating or transmission facilities and to secure financing for carrying out

the design, construction, operation, and maintenance of such facilities; and

 

         WHEREAS, pursuant to 42.45.310 of the Alaska Statutes, two or more

public utilities that purchase power from a power project acquired or

constructed as part of the former energy program for Alaska and owned by the

Alaska Energy Authority may form a joint action agency to purchase the power

project from the Alaska Energy Authority if the purchase and sale of the project

has been first authorized by law; and

 

         WHEREAS, each of the Initial Member Utilities is a "public utility" as

that term is defined in AS 42.05.990; and

 

         WHEREAS, each of the Initial Member Utilities possesses a Certificate

of Public Convenience and Necessity (CPCN) issued by the State of Alaska and

operates and manages generating and transmission facilities or power project and

related facilities; and

 

         WHEREAS, the Alaska Energy Policy Task Force report in 2004 recommended

the creation of a Railbelt organization to address regional energy issues; and

 

         WHEREAS, each Initial Member Utility has previously determined that the

formation of the joint action agency (the "Authority") is in the best interests

of such Initial Member Utility, and each Initial Member Utility has taken all

necessary and appropriate action to approve, and to authorize and direct the

execution and delivery of this Agreement;

 

         NOW, THEREFORE, the Initial Member Utilities, for and in consideration

of the mutual promises and agreements herein contained, do hereby agree as

follows:

 

Section 1.         Definitions.   As used in this Agreement:

 

(a) "Authority" means the joint action agency created by the Initial Member

Utilities under Section 2 hereof pursuant to the JAA Act.

 

(b) "Board" means the Board of the Authority established under Section 7 hereof.

 

(c) "Bond" or "Bonds" means any evidence of indebtedness issued or entered into

by the Authority, including any interest-bearing obligation of the Authority

that, by resolution of the Board, obligates the Authority to pay the holder

thereof a specified sum of money at specific intervals and to repay the

principal amount of the obligation at maturity, together with any bond, note,

bond or revenue anticipation note, obligation, loan agreement, financing lease,

certificate of participation, bank loan, financing agreement or similar

instrument or agreement issued or entered into by the Authority in connection

with a Project.

 

(d) "Bylaws" shall include the Bylaws approved in the manner required herein by

the Board, and any amendments thereto at any time.

 

(e) "Director" means the representative of a Member Utility duly appointed as a

member of the Board, or an alternate duly designated by the Member Utility to

act in the absence of any such representative pursuant to Section 7 hereof.

 

(f) "Fiscal Year" means January 1 to December 31 or such other fiscal period as

may be established by the Board.

 

(g) "Initial Member Utilities" mean Municipality of Anchorage d/b/a Anchorage

Municipal Light & Power (ML&P), Chugach Electric Association, Inc. (Chugach),

Golden Valley Electric Association (GVEA), that are parties to this Agreement.

 

(h) "JAA Act" means Title 42, Chapter 45, Section 300 et. seq. of the Alaska

Statutes (AS 42.45.300, 42.45.310, 42.45.320), as the same may be amended or

supplemented from time to time.

 

(i) "Member Utilities" mean the Initial Member Utilities and such other Public

Utilities that may become parties to this Agreement in accordance with Section

14 herein, but excluding those Public Utilities (including any Initial Member

Utility) that may withdraw from this Agreement in accordance with Section 14

herein.

 

(j) "Project" means a generating or transmission facility or power project and

related facilities located in the State of Alaska. Details of a particular

Project will be described in the acquisition or financing documents associated

with such Project.

 

(k) "Public Utility" means a public utility as defined in AS 42.05.990 that is

eligible to become a Member Utility under the JAA Act and is either municipally

owned utility or an electric cooperative under AS 10.25.

 

Section 2. Creation; Name. Pursuant to the JAA Act and this Agreement, there is

hereby created a joint action agency to be known as "ALASKA RAILBELT ENERGY

AUTHORITY."

 

Section 3.         Status of Authority.

 

(a) The Authority shall be an Alaska joint action agency and an instrumentality

of the Member Utilities, having a legal existence independent of and separate

from the Member Utilities. No debt, liability or obligation of the Authority for

a Project shall at any time constitute a debt, liability or obligation of any

Member Utility, unless a Member Utility has expressly agreed in writing to

assume or become obligated with respect to such debt, liability or obligation of

the Authority for such Project. The Authority shall have no power to bind,

obligate or impose any debt, liability or obligation of the Authority on any

Member Utility without their express consent, other than general administrative

costs of the Authority described in Section 3(b) below. The Authority shall

continue in existence until dissolved or terminated pursuant to Section 15

hereof.

 

(b) Each of the Member Utilities is obligated to pay its share of administrative

and overhead costs of the Authority. All such administrative and overhead costs

shall be approved by the Board in an annual budget. To the maximum extent

possible, all Project specific costs, including Project feasibility analysis,

shall be allocated by separate agreement to Member Utilities participating in

such Project. Each Member Utility shall have an equal percentage share of

administrative and overhead costs, unless otherwise described in the Bylaws to

be adopted by the Authority pursuant to Section 8 herein. The Bylaws shall

describe the procedures for preparing and approving of the Authority's annual

budget. To the extent reasonable, the Authority shall operate under a budget

approved the Board, and such budget shall establish the annual administrative

and overhead costs to be borne by the Member Utilities and a schedule for paying

these costs. This in no way shall prevent the Authority from incurring or

requiring Member Utilities from paying costs not budgeted, as long as such costs

are approved in advance by the Board.

 

(c) The Authority shall have no power to require any Member Utility to

participate in a Project of the Authority. The rights, responsibilities and

allocation of costs for each Project (e.g., a generation facility, transmission

segment, etc.) shall be established in a Project specific written agreement

between the Authority and the participating Member Utilities.

 

Section 4. Term. This Agreement shall become effective upon execution by each of

the Initial Member Utilities and shall continue in full force and effect until

such time as it is terminated in writing by all Member Utilities; provided,

however, that this Agreement shall not be terminated until such time as all

Bonds and all other indebtedness issued or obligations incurred or caused to be

issued or incurred by the Authority shall have been paid in full, or full

provision shall have been made for payment, including interest until their

payment date.

 

Section 5. Purpose of the Authority. The initial purpose of the Authority is to

investigate, evaluate, and improve cooperation of the Member Utilities and

coordination of electric generation and/or transmission services involving

Projects of the Authority and to do such other things as may be permitted by law

that further the interests of the Member Utilities. The Authority is authorized

under this Agreement to undertake any of the activities described in Section 6

below. The Member Utilities acknowledge that, if the Authority purchases a

state-owned power project as described in AS 42.45.310, this Agreement may be

amended pursuant to the provisions of Section 22 herein to include additional

provisions and authority under AS 42.45.310.

 

Section 6. Powers of the Authority. The Authority has the power to do all things

not prohibited by law, subject to the limitations and requirements of this

Agreement and applicable law, rules and regulations. The Authority is

specifically empowered to:

 

(a) sue and be sued in its own name;

 

(b) establish, prescribe, adopt, amend and repeal the terms of this Agreement

and Bylaws of the Authority;

 

(c) appoint officers, agents, and employees and vest them with powers and duties

and to fix, change, and pay compensation for their services;

 

(d) investigate, evaluate and improve cooperation and coordination of electric

generation and/or transmission services involving Projects of the Authority;

 

(e) operate, maintain or manage a Project of the Authority or a state-owned

power project;

 

(f) make and execute agreements, contracts, and other instruments necessary or

convenient in the exercise of its powers and functions, including contracts,

with any person, firm, corporation, government agency, or other entity;

 

(g) receive, administer, and comply with the conditions and requirements of an

appropriation, gift, grant, or donation of property or money;

 

(h) invest revenue and receipts as directed by the Board and any agents or

employees of the Authority so authorized by the Board;

 

(i) acquire, produce, develop, manufacture, use, transmit, distribute, supply,

exchange, sell, establish rates for or otherwise dispose of electric energy to

or for any person or entity, and other supplies and services as the Authority

determines necessary, proper, incidental or convenient in connection with its

purposes;

 

(j) determine, fix, alter, charge, and collect rates, fees, rentals, and other

charges for the use of a Project and any related facilities of the Authority or

for the service, electric energy or other commodities sold, rendered, or

furnished by it;

 

(k) enter on any land, water, or premises related to any portion of a Project,

or other additional generating, transmission or related facilities for the

purpose of making surveys, soundings, tests or other examinations;

 

(l) exercise the powers of eminent domain in accordance with AS 42.05.631 and

those powers authorized under AS 42.05.310, to the extent required to acquire

land necessary to the management and operation of a Project or the development,

construction, maintenance or improvement of a Project and any related

facilities;

 

(m) adopt, amend, and repeal rules and procedures necessary for the exercise and

performance of its powers and duties or to govern the rendering of service, sale

or exchange of electrical energy or other services and accommodations;

 

(n) construct, buy, lease, or otherwise acquire, and equip, maintain, operate,

and sell, assign, convey, lease, mortgage, pledge, or otherwise dispose of or

encumber lands, buildings, structures, electric, communications or other

equipment or systems, dams, plants and equipment, and any other real or personal

property, tangible or intangible, which is necessary, convenient or appropriate

to accomplish the purposes for which the Authority is formed;

 

(o) buy, lease, or otherwise acquire and use, and exercise and sell, assign,

convey, mortgage, pledge or otherwise dispose of or encumber franchises, rights,

privileges, licenses, and easements;

 

(p) maintain and operate electric energy and electric transmission and

distribution lines along, upon, under, over and across publicly owned lands and

public thoroughfares, including, without limitation, all roads, highways,

streets, alleys, bridges, and causeways;

 

(q) make donations for the public welfare or for charitable, scientific, or

educational purposes;

 

(r) secure and maintain policies of insurance, establish reserves, enter into

risk sharing and other agreements and take all other necessary and/or

appropriate actions to manage liabilities and risks associated with the

management and/or operation of a Project; and

 

(s) do and perform any other act or thing, and have and exercise any other power

that may be necessary, convenient, or appropriate to accomplish the purposes for

which the Authority is established.

 

Section 7.         Board of Directors.

 

(a) The Authority shall be governed by a Board of Directors. The Board shall at

all times consist of one Director appointed by each of the Member Utilities.

Each Member Utility shall also appoint one alternate to the Board, who may

attend all meetings and be granted all of the same rights and privileges as an

appointed Director, except the right to vote where the appointed Director is

present and able to vote on any matter before the Board. Subject to paragraph

(b) below, each Director and alternate shall serve for a one-year term

commencing on July 1 and ending on June 30 of each calendar year, provided that

a Director or an alternate to the Board shall continue to serve until his or her

successor is appointed. Directors and alternates may not be removed except as

provided by paragraph (d) below.

 

(b) Each Member Utility shall appoint its Chief Executive Officer/General

Manager as either Director or its alternate. Only employees or board of

directors members of a Member Utility shall be eligible for appointment to the

Board to represent such Member Utility. In the event a Board member is

terminated from employment by the