NRC-2015-0029, VT Exh 2 - Master Decommissioning Trust Agreement for Vermont Yankee Nuclear Power Station

VT Exh 2 - Master Decommissioning Trust Agreement for Vermont Yankee Nuclear Power Station

ML15111A086
Person / Time
Site:	Vermont Yankee
Issue date:	07/31/2002
From:	Krauss P, Mcneal S Entergy Nuclear Vermont Yankee, Mellon Bank, NA
To:	NRC/OCM
References
50-271, NRC-2015-0029, RAS 27535
Download: ML15111A086 (36)

Text

Exhibit 2 VT Ex. 2 001

ENTERGY NUCLEAR VERMONT YANKEE, LLC MASTER DECOMMISSIONING TRUST AGREEMENT FOR VERMONT YANKEE NUCLEAR POWER STATION Dated July 31, 2002 L1BC1I5486 79. 7

TABLE OF CONTENTS ARTICLE I. DEFINITIONS ................................................................................................. 2 1.01 Definitions ................................................ :.~ ....................................................... 2 ARTICLE II. MASTER TRUST PURPOSE, NAME AND FUNDS ............................... _S 2.01 Master Trust Purpose ......................................................................................... 5 2.02 Establishinent of Master Trust ................ :.......................................................... 5 2.03 Acceptance of Appointment .............................................................................. 5 2.04 N3llle of Master Trust ........................................................................................ 6 2.05 Division of Master Trust. ................................................................................... 6 2.06 Pesignation of Funds ......................................................................................... 6 2.07 Duties of Authorized Representatives ............................................................... 6 2.08 No Authority to Conduct Business .................................................................... 6 2.09 No Transferability of Master Trust .................................................................... 7 2.10 Use of Qualified Fund ........................................................................................ 7 ARTICLE In. CONTRIBUTIONS AND INCOME ........................................................... 7 3.01 Contributions ..................................................................................................... 7 3.02 Allocation of Net Incorne.~ ................................................................................. 7 3.03 Subsequent Transfers ......................................................................................... 7 ARTICLE IV. DISTRIBUTIONS ......................................................................................... 8 4.01 Payment ofDecornmissioning Costs and Administrative Expenses ................. 8 4.02 AdIninistrative Expenses .................................................................................... 8 4.03 Fees .................................................................................................................... 8 4.04 Liquidation of Investrnents ................................................................................ 8 4.05 Notice to the NRC .............................................................................................. 8 4.06 Approval by State of Vermont Public S~ce Board ........................................ 9 ARTICLE V. TERMINATION ............................................................................................. 9 5.01 Termination of Funds and Master Trust in General ........................................... 9 5.02 Distribution of Master Trust and Funds Upon Termination .............................. 9 ARTICLE VI. TRUSTEES .................................................................................................. 10 6.01 Designation and Qualification of Successor Trustee(s) ................................... 10 6.02 Exoneration from Bond.................................................................................... 11 6.03 Resignation ....................................................................................................... 11 6.04 Transactions with Third Parties ....................................................................... 11 6.05 Accounts and Reports ...................................................................................... 11 6.06 Tax Returns and Other Reports ........................................................................ 12 6.07 Liability............................................................................................................ 12 L1selJ 548679.7

/.

ARTICLE VII. TRUSTEE'S GENERAL POWERS ..*..*.****........*........*....*..*....*.....**...-.. 14 7.01 Registration of Securities .........................................*...................................... 14 7.02 Borrowing ........................................................................................................ 14 7.03 Retention and Removal of Professional and Employee Services .................... 14 7.04 Delegation of Ministerial Powers ...............................................................*..... 14 7.05 Powers of Trustee to Continue Until Final Distribution .................................. 14 7.06 Discretion in Exercise of Powers ..................................................................... 14 7.07 Deposit ofFWlds .............................................................................................. 15 7.08 Loaning of Securities ....................................................................................... 15 7.09 Retention of Uninvested Cash ......................................................................... 15 ARTICLE VIII. INVESTMENTS ....................................................................................... 15 8.01 General InvestInent Powers ............................................................................. 15 8.02 Direction by Investment Manager(s) ............................................................... 15 8.03 'Frustee's General Investment Powers ............................................................. 16 i

ARTICLE IX. MISCELLANEOUS .................................................................................... 18 9.01 Headings ........... :............................................................................................... 18 9.02 Interpretation .................................................................................................... 18 9.03 Severability of Provisions ................................................................................ 18 9.04 Delivery of Notices Under Agreement ............................................................ 18 9.05 Alterations and AInendnlents I

........................................................................... 19 9.06 Successors and Assigns .................................................................................... 20 9.07 Governing Law; Jurisdiction; Certain Waivers ............................................... 20 9.08 Accounting Year ............................................................................................... 20 9.09 Counterparts ..................................................................................................... 20 9.10 Decommissioning Liability.............................................................................. 20 9.11 Limitation on Liability ofTrustee.................................................................... 21 9.12 Representation.................................................................................................. 21 EXHIBIT A PERMITTED lNVESTMENTS EXHIBIT B FORM OF DECOMlVITSSIONING CERTIFICATE EXHIBIT C CROSS TRADING INFORMATION EXHIBIT D DECOMMISSIONING REQUIREMENTS

.. 'EXHIBIT E SPONSORS AND OWNERSHIP INTEREST EXHmIT F FORM OF NOTIFICATION OF ASSIGNMENT II L1BC/I 548679.7

MASTER DECOMMISSIONING TRUST AGREEMENT MASTER DECOMMISSIONING TRUST AGREEMENT made as of this 31st day of July 2002, by and between ENTERGY NUCLEAR VERMONT YANKEE, LLC, a Delaware limited liability company (the "Company"), and MELLON BANK, N.A., as Trustee (the "Trustee), a national banking association having trust powers.

WHEREAS, the Station is a nuclear fueled electric generating station which will require Decommissioning at the end of its useful life; WHEREAS, pursuant to the requirements of the NRC, the owner of the Station is required to create and maintain a source of funding to provide for the costs associated with the Decommissioning of the Station; WHEREAS, the Company is party to a Purchase and Sale Agreement (the "Purchase and Sale Agreement"), dated as of August 15,2001, as amended from time to time, by and among Vennont Yankee Nuclear Power Corporation, a Vennont corporation ("VYNPC), the Company, and Entergy Corporation, a Delaware corporation, pursuant to which VYNPC is transferring to the Company all or substantially ail of the assets and certain Of the liabilities constituting the Station; WHEREAS, among those assets ahd liabilities being transferred to the Company pursuant to the Purchase and Sale Agreement, are (i) all of those assets comprising the trust funds maintained by VYNPC with respect to Decommissioning ofthe Station pursuant to the Indenture of Trust, dated as of March 11, 1988, as amended, between VYNPC and The Bank of New York, as successor trustee (the "VYNPC Trust Funds"), and (ii) all of the liabilities of VYNPC in respect of: (a) the Decommissioning of the Station and the Site following pennanent cessation of operations, (b) the management, storage, transportation and disposal of spent nuclear fuel generated at the Station (other than as specified in the Purchase and Sale Agreement), and (c) any other post-operative disposition of the Station or any other of the assets being purchased by the Company; WHEREAS. pursuant to Section 468A of the Internal Revenue Code of 1986, as amended, (the "Code") certain federal income tax benefits are available to the Company as a result of creating and making contributions to certain nuclear decommissioning reserve funds; WHEREAS, the Company. in order to comply with the requirements of the NRC, and in order to be in a position to take advantage of the federal income tax benefits available under the

,'aforementioned Section 468A, wishes to establish the Qualified Fund and the Nonqualified Fund to hold amounts in trust for the future Decommissioning of the Staiion; WHEREAS. the Company wishes to establish a master trust (the "Master Trust") for the retention and investment of the assets of the Qualified Fund and Nonqualified Fund for the Station, wherein each of the Funds shall constitute a separate trust under the Master Trust; and L1BCl1548679.7

WHEREAS, Mellon Bank, N.A. is willing to serve as Trustee under the Master Trust on the tenns and conditions herein set forth.

• NOW, THEREFORE, in consideration ofthe mutual promises herein contained and other good and valuable consideration, receipt and sufficiency of which is hereby acknowledged, the Trustee hereby agrees to accept, from and after the date first above written, Contributions to the Master Trust delivered to it from time to time by or on behalf of the Company; TO HA VE AND TO HOLD such assets; TO INVEST AND REINVEST the same as provided herein; IN TRUST NEVERTHELESS, for the uses and purposes and upon the terms and conditions, as hereinafter set forth; and 1

TO PAY OR DISTRIBUTE from the Master Trust as provided herein.

ARTICLE I.

DEFINITIONS 1.01 Defirutions. As used in this Master Decornmissiorung Trust Agreement, the following terms shall have the following meanings:

(a) "Administrative Expenses" has the meaning given in Section 4.02.

(b) "Agreement" means this Master Decommissioning Trust Agreement as the same may be amended, modified, or supplemented from time to time.

(c) "Applicable Law" means all applicable laws, statutes, treaties, rules, codes, ordinances, Regulations, certificates, orders, interpretations, licenses and pennits of any Governmental Authority and judgments, decrees, injunctions, writs, orders or like action of any court, arbitrator or other judicial or quasi-judicial tribunal of comp.etent jurisdiction (including those pertaining to health, safety, the environment or otherwise).

(d) "Applicable Tax Law" means Section 468A of the Code (or any comparabJe subsequent provision of the Code) and the Regulations thereunder, and any other provision of the Code relating to the federal taxation of the Funds or credits or deductions based on Contributions.

(e) "Authorized Representatives" has the meaning given in Section 2.07.

(f) "Business Day" means any day other than Saturday, Sunday and any day which is a legal holiday or a day on which banking institutions in the Commonwealth of Pennsylvania are authorized or required by Applicable Law or other action of Governmental Authority to close.

(g) "Code" has the meaning given in the recitals of this Agreement.

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(h) "Company" has the meaning given in the preamble of this Agreement.

(i) "Contribution" means any contribution, cash or otherwise, made to the Trustee for deposit in one or more of the Funds and in such subaccounts thereunder as provided in this Agreement. No contribution that consists of real property shall be pennitted.

(j) "Decommissioning" means the removal of the Station from service and disposal of its components in accordance with Applicable Law. This process shall include, but not be limited to, (i) pre-shutdown activities related to the removal and disposal of the Station including studies, planning, licensing, regulatory filings and non-DOE spent fuel storage, (ii) work done to prepare and carry out DECON, ENTOMB or SAFSTOR (as defined by the N"RC) of the Station and the Site, whichever is applicable, (iii) the removal of radioactively contaminated and radioactively uncontaminated portions of the Station and disposing of the same at the end of the operating life of the Station, (iv) work done to the Site and the Station's associated equipment and facilities and to other areas, whether or not such areas are contiguous to the Site and ~quipment and facilities, in order to decontaminate such Site and such areas, and (v) work done by or on behalf of the Company (or for which the Company is charged) to a facility where any portion of the Station and its associated equipment and facilities are to be disposed of in order to prepare and maintain such facility as a disposal site.

(k) "Decommissioning Certificate" means a document properly completed and executed by an Authorized Representative and substantially in the fonn of Exhibit B as it may from time to time be amended.

(1) "Decommissioning Costs" sha11 mean all costs and expenses relating or allocable to, or incurred in connection with, Decommissioning, including, but not limited to, the decontamination and/or removal ofthe equipment, structures and portions of the Station and the Site provided, however, that if Applicable Law prohibits the foregoing or imposes requirements that are more costly to implement than their removal, the tenn "Decommissioning Costs"shal1 mean all costs and expenses relating or allocable to, or incurred in connection with, the requirements imposed by Applicable Law at the end of the Station's operating life.

(m) "Docket 6545 Decommissioning Activities" has the meaning given in Exhibit D.

(n) "Excess Funds" shall have the meaning given in Exhibit D.

(0) "Exemption" has the meaning given in Section 8.03(b).

(P) "FERC" means the Federal Energy Regulatory Commission or any successor thereto.

(q) "Funds" means the Qualified Fund and the Nonqualified Fund, collectively.

(r) "Governmental Authority" means any federal, state, county, municipal, foreign, international, regional or other governmental authority, agency, board, body, instrumentality or court, including, without limitation, the NRC and the FERC.

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(s) "Investment Account" has the meaning given in Section 8.01.

(t) "Investment-Grade Securities" means "investment-grade" securities, including, without limitation, investment-grade bonds and preferred stocks, which are those rated at least "BBB" or equivalent by a national rating service, but shall not included (i) speculative issues of common stocks, including without limitation "b\Illetin board" stocks listed on the NASDAQ exchange, "pink sheet" stocks, and stocks not traded on major exchanges, and (ii) high yield or '1W1k:" bonds.

(u) "Investment Manager" has the meaning given in Section 8.01.

(v) "Master Trust" has the meaning given in the recitals of this Agreement.

(w) "Nongualified Fund" means a trust fund that does not constitute the Qualified Fund established under, and in accordance with, Section 2.02(b) or such other Nonqualified Ftinds as the Company shall establish from time to time in accordance with Section 2.05. A Nonqualified Fund shall have such subaccounts as the Company may specify.

(x) "NRC" means the Nuclear Regulatory Commission, the agency established in Title II of the Energy Reorganization Act of 1974, as amended, comprising the members ofthe Commission and all offices, employees and representatives authorized to act in any case or matter, or any successor agenqy.

(y) NRR Director" has the meaning given in Section 4.05.

(z) "Nuclear Safety Director" has the meaning given in Section 4.05.

(aa) "Order" shall mean any order relating to Decommissioning issued by a Govenunental Authority and applicable to the Station.

(bb) "Purchase and Sale Agreement" has the meaning given the recitals of this Agreement.

(cc) "Qualified Fund" means the trust fund established under, and in accordance with. Section 2.02(b) for purposes of Section 468A of the Code, which is designated as such in the records of the Trustee. The Qualified Fund shall have such sub accounts as the Company may specify. Contributions, if any, made to the Qualified Fund in any year shall not exceed the amount pennitted to be made to such Fund with respect to the year in question in order for the Company to be allowed to take the deduction afforded by Section 468A of the

.*Code.

(dd) "Regulation" means any requirement having the force of law which is binding on the Company.

(ee) "Service" means the Internal Revenue Service or any successor thereto.

(ff) "Site" means the land upon which the Station is situated, located in Vernon, Vermont.

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(gg) "Site Restoration Costs" shall have the meaning given in Exhibit D.

(hh) "Spent Fuel Costs" has the meaning given in Exhibit D.

(ii) "Sponsors" shall have the meaning given in Exhibit E.

(jj) "Station" means the nuclear fueled electric generating station designated as and known as Vennont Yankee Nuclear Power Station (NRC Operating License No. DPR-28) at the Site together with those facilities, equipment, supplies, and improvements included in the Acquired Assets (as such tenn is defined in the Purchase and Sale Agreement).

(kk) "Trustee" has the meaning given in the preamble of this Agreement or any successor appointed pursuant to Section 6.01.

(11) "VYNPC" has the meaning given in the recitals of this Agreement.

i ARTICLE II.

MASTER TRUST PURPOSE, NAME AND FUNDS 2.01 Master Trust Pwpose. The exclusive purpose of this Master Trust is to accumulate and hold funds for the contemplated Decommissioning of the Station and to use such funds, in the first instance, for expenses related to the Decommissioning of the Station as defined by the NRC in its Regulations and issuances, and as provided in the licenses issued by the NRC for the Station and any amendments thereto.

2.02 Establishment of Master Trust. By execution ofthis Agreement, the Company:

(a) establishes the Master Trust for the-retention and investment of the assets of the Funds, which shall be effective on the date first above written; (b) ( establishes the Qualified Fund and the Nonqualified Fund for the Station; and (c) appoints Mellon Bank, N.A. as Trustee of the Master Trust.

2.03 Acceptance of Appointment. Upon the tenns and conditions herein set forth the Trustee accepts the appointment as Trustee of this Master Trust. The Trustee declares that it will hold all estate, right, title and interest it may acquire hereWlder exclusively for the purposes set forth in this Article ll. The Trustee shall receive any Contributions deposited with it by the Company in trust for the benefit of the Company and shall deposit such Contributions in one or more of the Funds, and in such subaccoWlts thereunder, as provided in Section 2.05 and otherwise as the Company shall specify. The Trustee shall hold, manage, invest and administer such Contributions, together with earnings and appreciation thereon, in accordance with this Agreement. In performing its duties under this Agreement, the Trustee shall exercise the same care and diligence that it would devote to its own property in like circumstances. The Trustee, Investment Manager or anyone else directing the investments made in this Master Trust shall 5

L1BCl1548679.7

adhere to a "Prudent Investor' standard as specified in 18 CFR 35.32(a)(3) of the Federal Energy Regulatory Commission's regulations or any comparable Regulation.

2.04 Name of Master Trust. The Contributions received by the Trustee from the Company together with the proceeds, reinvestments and appreciation thereof shall constitute the "Entergy Nuclear Vermont Yankee Master Decommissioning Trust."

2.05 Division of Master Trust.

(a) The Master Trust shall be divided by the Trustee into the Qualified Fund and the Nonqualified Fund for the Station and into such other Nonqualified Funds as the Company from time to time shall establish. Each Fund shall constitute a separate trust under the Master Trust and shall be designated as relating to the Station. Each Fund may have subaccounts as the Company from time to time shall specify.

(b) The Trustee shall maintain such records as are necessary to reflect each Fund and each subaccount thereunder separately on its books from each other Fund and subaccount.

2.06 Designation of Funds. Upon (i) any Contribution to the Master Trust; or (ii) any

'withdrawal from the Master Trust; or (iii) any transfer between the Funds or subaccounts thereunder, the Company shall designate (in writing) in accordance with Articles ill or IV oftbis Agreement, as applicable, the Fund(s), and the subaccount(s) thereunder, which is to be credited or debited for the amount of such Contribution, withdrawal or transfer, and the Trustee shall credit or debit the FWld(s), and the subaccount(s} thereunder, in accordance with such designation.

2.07 Duties of Authorized Representatives. The Company shall provide the Trustee with a written statement setting forth the names and specimen signatures of those persons it designates as "Authorized Representatives". The Company hereby empowers the Authorized Representatives and their delegates to act for the Company in all respects hereWlder. The Authorized Representatives may act as a group or may designate one or more Authorized Representative(s) or delegate(s) to perform the duties described in the foregoing sentence. The Authorized Representatives shall provide the Trustee with a written statement setting forth the name and specimen signature of any delegate of the Authorized Representatives. Until otherwise notified in writing by the Company, the Trustee may rely upon any written notice, instruction,

. direction, certificate or other communication believed by it to be genuine and to be signed or certified by anyone or more Authorized Representatives or their designated delegate(s) and the

. Trustee shall be WIder no duty to make any investigation or inquiry as to the truth or accuracy of

/any statement contained therein.

2.08 No Authority to Conduct Business. The purpose of this Master Trust is limited specifically to the matters set forth in Section 2.01, and there is no objective to carry on any business unrelated to the Master Trust purpose set forth in Section 2.01, or to divide the gains therefrom.

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2.09 No Transferability of Master Trust. The interest of the Company in the Master Trust is neither transferable, whether voluntarily or involuntarily, oy the Company nor subject to the payment of the claims of creditors of the Company; provided, however, that any creditor of the Company as to which a Decommissioning Certificate has been properly completed and submitted to the Trustee may assert a claim directly against the Master Trust in an amount not to exceed the amount specified in such Decommissioning Certificate; and provided, further, that all or a portion of the interest of the Company in the Master Trust may be transferred to a purchaser of all or substantially all of the assets of the Station that also assumes responsibility for Decommissioning the Station.

2.10 Use of Qualified Fund. The assets of the Qualified Fund shall be used only as authorized by Code Section 468A and the Regulations thereunder as amended from time to time.

ARTICLE III.

CONTRIBUTIONS AND INCOME 3.01 Contributions. The Company may make such Contributions to any Fund from time to time as it shall deem necessary or appropriate. The Trustee shall return Contributions to the Company to the extent such Contributions are made by the Company and such Contribution is stated in a written opinion oflegal counsel to the Company, who may be an employee of the Company, to be excessive in light of Applicable Law and Applicable Tax Law.

3.02 Allocation orNet Income. The Trustee may pool the assets among the Funds for investment purposes in accordance with the written instructions of the Company, subject to the limitations on investments contained in Exhibit A, and, upon so doing, shall treat each Fund so pooled as having received or accrued a pro rata portion (based on the principal balances of the Fund so pooled) of the net income of the Master Trust (including appreciation) related to such pooled assets in any accounting period of the Master Trust. Without limiting the requirements of Section 6.05, the Trustee shall maintain such separate records of each of the Funds and the sub accounts thereunder as are necessary to reflect the assets thereof and the allocation of income and losses among the Funds and sub accounts thereunder. The Trustee may rely upon the written opinion oflegal counsel of the Company, who may be an employee of the Company, with respect to any question arising under this Section 3.02.

3.03 Subsequent Transfers. Upon receipt of a written directive of the Company signed by one or more Authorized Representatives or their designated delegate(s) which sets forth an amount to be transferred from one of the Funds or subaccounts thereunder and states that such

,amount should be transferred to one or more other Funds or subaccounts as specified, the Trustee shall transfer such amount to the Fund(s) or sub accounts specified by the Company in the written directive.

7 USCII 548679.7

ARTICLE IV.

DISTRIBUTIONS 4.01 Payment of Decommissioning Costs and Administrative Expenses. In addition to payments otherwise authorized by this Agreement, the Trustee shall make payments out of the Funds or any sub accounts thereunder upon being presented with a Decommissioning Certificate by the Company that instruct the Trustee to disburse amounts in the Funds or any subaccounts thereunder in a manner designated in such Decommissioning Certificate for purposes of paying costs, liabilities and expenses of Decommissioning or, if so specified, administrative expenses related to services authorized by the Company pursuant to Section 4.02. Once Decommissioning is completed, the Trustee shall also disburse amounts in the Funds in a manner designated in any Decommissioning Certificate for the purposes of paying costs, liabilities and expenses of Docket 6545 Decommi,ssioning Activities, Spent Fuel Costs and Site Restoration Costs (each to the extent not inc1qded in Decommissioning). If the assets of any Fund or subaccount thereof are insufficient to permit the payment in full of amounts to be paid pursuant to a Decommissioning Certificate, the Trustee shall have no liability with respect to such insufficiency and no obligation to use its own funds to pay the same.

4.02 Administrative Expenses. In addition to the payment of administrative expenses paid pursuant to Section 4.01, from time to time, the Trustee shall make payments of all administrative expenses (including taxes,ireasonable out-of-pocket expenses, and the Trustee's fees as specified in the agreement referred to in Section 4.03) (collectively, the "Administrative Expenses") in connection with the operation of the Master Trust pursuant to this Agreement. All such Administrative Expenses and incidental expenses of the Master Trust shall be allocated proportionately among the Funds (based on the fair market value of each Fund immediately prior to any such payment) and within each Fund among the sub accounts in the proportion that the balance in each subaccount bears to the aggregate balance of all subaccounts in such Fund; provided. that income taxes shall be paid for each of the Funds in accordance with the income tax actually imposed on each such Fund. The Trustee shall maintain such records as are necessary to reflect the allocation of Administrative Expenses and incidental expenses among the Funds in accordance with this Section 4.02. If the assets of any Fund or subaccount thereof are insufficient to pennit the payment in full of amounts payable under this Section 4.02, the Trustee shall have no liability with respect to such insufficiency and no obligation to use its own funds to pay the same.

4.03 Fees. The Trustee shall receive as exclusive compensation for its services such amounts as may from time to time be agreed to by the Trustee and the Company.

4.04 Liquidation of Investments. At the direction of the Company or its Investment Manager, the Trustee shall sell or liquidate such investments ofthe Funds as may be specified.

The proceeds of any such sale or liquidation shall be credited pro rata to the Fund or Funds and within each Fund to the subaccount or subaccounts thereunder to which such investments were credited prior to such sale or liquidation.

4.05 Notice to the NRC. Notwithstanding anything in this Agreement to the contrary, no disbursements or payments shall be made by the Trustee,. other than Administrative Expenses 8

LlBCIIS48679.7

in accordance with Section 4.02, until the Trustee has first given th~ NRC thirty (30) days' prior written notice of payment; provided, however, that no disbursement or payment from this Master Trust shall be made if the Trustee receives prior written notice of objection from the Director, Office ofNuc1ear Reactor Regulation (the "NRR Director). After the Company has first authorized the Trustee to disburse funds from the Master Trust to pay Decommissioning*Costs in accordance with 10 CFR 50.82(a)(8)(i) or other applicable ,NRC Regulation. the Trustee will no longer be obligated to notify the NRC for subsequent disbursements or payments in connection with Decommissioning the Station.

4.06 Approval by State of Vermont Public Service Board. In the event the Company shall request disbursements or payments from this Master Trust other than pursuant to Section 4.01 (Decommissioning costs including costs for decommissioning, spent fuel storage and site restoration contemplated under Exhibit D pursuant to Section 5.01 ). Section 4.02 (Administrative Expenses includ¥ig Trustee fees and income taxes) or Section 5.02 (termination), then in such other case the Cqmpany shall have received the approval for such disbursement or payment from the State of Vermont Public Service Board (or its successor).

ARTICLE v.

TERMINATION 5.01 Termination of Funds and rJiaster Trust in General. Each Fund established hereunder shall terminate only upon the earlier of (i) the date on which the Trustee receives written notification from an Authorized Representative of the occurrence of both the "Completion of Decommissioning" (as defined in Exhibit D) and the satisfaction of the other requirements regarding the conditions precedent for the return of excess ftmds set forth in Exhibit D; or (ii) twenty-one (21) years after the death ofthe last survivor of each person who was an officer, director, member, or manager of the Company on the date of this Agreement and each of their descendants born on or prior to that date. This Master Trust shall tenninate upon the tennination of all of the Funds. Prior to its tennination, this Master Trust shall be irrevocable.

5.02 Distribution of Master Trust and Funds Upon Termination. Without limitation of Section 3.01 of this Agreement, upon termination ofthis Master Trust or of the Funds with respect to the Station, the Trustee shall liquidate the assets of the Master Trust or such Funds, as the case may be, and distribute the Excess Funds (which shall not include funds necessary for Spent Fuel Costs and Site Restoration Costs) held in such Funds (less all reasonable final Administrative Expenses), unless othexwise detennined, ordered or required by any Governmental Authority, to VYNPC as provided in Exhibit D and for the benefit ofthe Sponsors in pro rata shares in proportion to the stated ownership percentage of the Sponsors set forth on Exhibit E. The term Excess Funds shall not include any amounts contributed by the Company after the date of this Agreement pursuant to Section 3.01, or any amounts of net income in respect of such amounts, all of which amounts shan be distributed to the Company upon liquidation of the assets of the Master Trust or Funds. Further, upon termination of this Master Trust or such Funds, the Trustee shall distribute all funds necessary for Spent Fuel Costs and Site Restoration Costs to the Company. An Authorized Representative will provide the Trustee with 9

LIBClI 548679.7

one or more written notices regarding the timing and amount of distributions to be made pursuant to this Section 5.02 and also of the satisfaction of the conditions precedent regarding the return of Excess F1ll1ds set forth in Exhibit D. The Trustee shall be permitted to rely conclusively upon any written notification received from an Authorized Representative relating to matters arising WIder Exhibit D or as to any determination, order or decision of Governmental Authorities.

5.03 Assignment of Right to Receive Payment of Excess Funds. Notwithstanding anything in this Agreement, including Section 5.02 or Exhibit D to the contrary, VYNPC and each of the Sponsors shall each have the right to irrevocably transfer all of their respective right.

title and interest to receive Excess Funds under this Agreement. The party assigning its rights to receive excess funds shall notify the Trustee in a writing signed by a duly authorized representative of the assigning entity upon such assignment, using the fonn of assignment attached hereto:as Exhibit F. The Trustee may rely conclusively upon any notice of assignment and such assigIlIllent shaH be binding upon the Company, the Trustee, the assigning party and each of their respective successors, assigns, personal representatives, executors and heirs. Upon receipt of notice of an assignment, the Trustee shall thereafter deliver the excess funds, if any and at the time otherwise distributable pursuant to Section 5.02, directly to the named assignee, notwithstanding the provisions of Section 5.02 and Exhibit D .

ARTICLE I

VI.

TRUSTEES 6.01 Designation and Qualification of Successor Trustee(s).

(a) At any time during the term of this Master Trust, the Company shall have the right to remove the Trustee (at the Company's sole discretion) acting hereunder and appoint another qualified entity as a successor Trustee upon thirty (30) days' notice in writing to the Trustee, or upon such shorter notice as may be acceptable to the Trustee. In the event that the bank. or trust company serving as Trustee or successor Trustee shall: (i) become insolvent or admit in writing its insolvency; (ii) be Wlable or admit in writing its inability to pay its debts as such debts mature; (iii) make a general assignment for the benefit of creditors; (iv) have an involuntary petition in bankruptcy filed against it; (v) commence a case under or othelWise seek to take advantage of any bankruptcy, reorganization, insolvency, readjustment of debt, dissolution or liquidation law, statute, or proceeding; or (vi) resign, the Company shall appoint a successor Trustee as soon as practicable. In the event of any such removal or resignation, the Trustee or successor Trustee shall have the right to have its accounts finalized as provided in

" Section 6.05. Any successor to the Company, as provided herein, shall have the same right to remove and to appoint any Trustee or successor Trustee.

(b) Any successor Trustee shall be a bank or trust company incorporated and doing business within the United States of America and having a combined capital and surplus of at least Two Hundred Fifty Million Dollars ($250,000,000), if there be such an institution willing, able and legally qualified to perfonn the duties of Trustee hereunder upon reasonable or customary tenns.

10 LIBC1I548679,7

(c) Any successor Trustee shall qualify by a duly acknowledged acceptance of this Master Trust, delivered to the Company. Upon acceptance of sllch appointment by the successor Trustee, the Trustee shall assign, transfer and pay over to such successor Trustee the assets then constituting the Master Trust. Any successor Trustee shall have all the rights, powers, duties and obligations herein granted to the original Trustee.

6.02 Exoneration from Bond. No bond or other security shall be exacted or required of any Trustee or successor Trustee appointed pursuant to this Agreement.

6.03 Resignation. The Trustee or any successor Trustee hereof may resign and be relieved as Trustee at any time without prior application to or approval by or order of any court by a duly acknowledged instrument, which shall be delivered to the Company by the Trustee no less than thirty (30) days prior to the effective date of the Trustee's resignation or upon such shorter notice as may be acceptable to the Company. !ffor any reason the Company cannot or does not act in me event of the resignation of the Trustee, the Trustee may apply to a court of competent jurisdiction for the appointment of a successor Trustee and the cost of making such application shall be an Administrative Expense.

6.04 Transactions with Third Parties. No person or organization dealing with the Trustee hereunder shall be required to inquire into or to investigate its authority for entering into any transaction or to see to the application of the proceeds of any such transaction.

6.05 Accounts and Reports.

(a) The Trustee shall keep accurate and detailed accounts of all investments, receipts and disbursements and other transactions hereunder with respect to each Fund and each subaccount thereunder in accordance with specifications of the Company, and all accounts, books and records relating thereto shall be open to inspection and audit at all reasonable times by any person designated by the Company. Within twenty-five (25) days following the close of each month, the Trustee shall provide a written report of the estimated market value of each Fund and each subaccount thereunder, prepared on an accrual basis. Within thirty-five (35) days foUowing the close of each month, the Trustee shall :file with the Company a final written report setting forth all investments, receipts and disbursements and other transactions effected by it during the month and containing an exact description of all cash and securities contributed, purchased, sold or distributed and the cost or net proceeds 0 f sale, and showing all cash, and securities and other investments held at the end of such month and the cost and fair market value of each item thereof as carried on the books of the Trustee. Such accounts and reports shan be based on the accrual method of reporting net income and expenses and shall show the portion of the assets applicable to each Fund and subaccount thereunder and shall also identify all disbursements from each Fund and subaccount thereunder.

(b) Upon the expiration of ninety (90) days from the date of filing such written reports with the Company, the Trustee shall be forever released and discharged from all liability or accountability to anyone with respect to all acts and transactions shown in such written reports, except such acts or transactions as to which the Company shall take exception by written notice to the Trustee within such ninety (90) day period; provided, however, that nothing contained in this Section 6.05(b) shall be deemed to relieve the Trustee of any liability imposed 11 LIBC/1548679.7

pursuant to Section 6.07. In the event that any exception taken by the Company cannot be amicably adjusted, the Company may, within one (I) year of the date of such exception, file the written report in a court having jurisdiction and upon the audit thereof any and all such exceptions which may not have been amicably settled shall be heard and adjudicated. Any exception not so filed within one (1) year shall be deemed waived and any liability of the Trustee with respect thereto shall be deemed released.

(c) All records and accounts maintained by the Trustee with respect to the Master Trust and the Funds shall be preserved for such period as the Company shall specify and in the absence of any instructions from the Company shall be preserved for a period of four (4) years. Upon the expiration of any such required retention period, the Trustee shall have the right to destroy such records and accounts after first notifying the Company in writing of its intention and transferring to the Company any records and accounts requested by the Company.

6.06 Tax Retmns and Other Reports. The Company, or the Trustee at the Company's direction, shall prepare and file all federal, state and local income or franchise tax returns and other reports (including estimated tax returns and infonnation returns) as may be required from time to time with respect to the Qualified Fund, and the Trustee agrees to provide the Company in a timely manner with any information which is necessary to such filings which is not in the possession of the Company. The Trustee shall prepare and submit to the Company in a timely manner all information requested by the Company regarding the Funds required to be included in the Company's federal, state and local incli>me tax returns or other reports (including tax returns and information returns). The Trustee may employ independent certified public accountants or other tax. counsel to prepare or review such returns and reports and the reasonable cost thereof shall be an Administrative Expense. The Trustee agrees to sign any tax. returns or other reports where required by law to do so or arising out of the Trustee's responsibilities hereunder, and to remit from the Master Trust appropriate payments or deposits of federal, state and local income or franchise taxes directly to the taxing agencies or authorized depositaries or to the Company, in the event that the Company has directly paid such taxes. Any interest or penalty charges assessed against the Master Trust pursuant to Chapters 67 or 68 of the Code or pursuant to any similar state or local tax. provisions, as a result of the Trustee's failure to comply with this Section 6.06 shall be an Administrative Expense unless caused by the Trustee's negligence or willful misconduct in which case such interest or penalty charges shall be borne by the Trustee and not the Master Trust. The Trustee agrees to notify the Company in writing within ten (10) days of the conunencement of the audit of the Qualified Fund's federal, state or local tax returns, and to participate with the Company on behalf of the Qualified Fund in such audits and related inquiries. The Trustee further agrees to provide the Company with any additional infonnation in its possession regarding the Master Trust that may be requested by the Company to be furnished

,in an audit of the Company's federal, state or local tax. returns.

6.07 Liability.

(a) The Trustee shall not be liable for any loss or injury reSUlting from its actions or its performance of its duties hereunder or for its investment decisions in the absence of its own willful misconduct or negligence. In no event shall the Trustee be liable (i) for acting in accordance with instructions from an Authorized Representative or a duly designated delegate or pursuant to a legal opinion of counsel to the Trustee or to the Company, or (ii) for special or 12 LIBO'IS48679.7

consequential damages or (iii) for any losses resulting from the deposit or maintenance of securities or other property (in accordance with market practice, custom, or regulation) with any recognized foreign or domestic clearing facility, book-entity system, centralized custodial depository, or similar organization.

(b) Notwithstanding anything contained in this Agreement to the contrary, upon receipt of written notice from the Company (satisfactory in fonn to the Trustee) identifying persons and entities as "disqualified persons" which may not engage in transactions with the Master Trust because to do so would constitute "self-dealing" pursuant to Code Section 468A(e)(5) or Code Section 4951 (or any applicable successor provisions), the Trustee shall refrain from authorizing or carrying out the transactions with such "disqualified persons" unless the decision to so refrain would require knowledge of facts not apparent on the face of such transaction. In this latter case, the Trustee will so refrain only ifit has knowledge of the pertinent facts ~d shall be under no obligation to detennine the facts. If the Trustee authorizes or carries out any transaction in violation of the provisions of this clause (b), the Trustee (and not the Master Trust or the Qualified Fund) shall be liable for any tax imposed on the Master Trust, the Qualified Fund, or the Trustee pursuant to Code Section 4951 (or any applicable successor provision) and for any loss or damage sustained by the Master Trust, the Qualified Fund, or the Company. Otherwise, the Trustee shall not be liable for any such tax or loss.

(c) The Company shall indemnify the Trustee and hold it harmless against any and all claims, losses, liabilities, excise taxes, damages or reasonable expenses (including attorneys' fees and expenses) arising from or in connection with this Agreement or the performance of its duties hereunder, together with any income taxes imposed on the Trustee as a result of any indemnity paid by it hereunder, provided, however, that nothing contained herein shall require that the Trustee be indemnified for any liability imposed pursuant to clauses (a) or (b) of this Section 6.07. Nothing contained herein shall limit or in any way impair the right of the Trustee to indemnification under any other provision of this Agreement (d) The Company understands that when and if the Trustee delivers property against payment, it may deliver such property prior to receiving final payment and that, as a matter ofbookkeeping convenience, the Trustee may credit one or more of the Funds with anticipated proceeds of sale prior to actual receipt of final payment. The risks of non-receipt of payment shall be the Company's and the Trustee shall have no liability therefore.

(e) All credits to the Funds of the proceeds of sales and redemptions of property and of anticipated income from property shall be conditional upon receipt by the Trustee of fjnal payment and may be reversed to the extent final payment is not received. In the event that the Trustee in its discretion advances funds to the Master Trust to facilitate the

'settlement of any transaction, the Master Trust shall, inunediately upon demand, reimburse the Trustee for such amounts plus any interest thereon, and to secure such obligations as well as any other obligations of the Master Trust hereunder, the Company, to the extent pennitted by Applicable Law, hereby grants a continuing security interest in and pledges to the Trustee the property in the Funds and any funds so credited.

13 L1BCl1548679.7

(f) The provisions of this Section 6.07 and the right of the Trustee to claim the benefit thereof shall survive any tennination oftrus Agreement and any resignation or removal of the Trustee.

ARTICLE VII.

TRUSTEE'S GENERAL POWERS The Trustee shall have, with respect to the Master Trust, the following powers, all of which powers are fiduciary powers to be exercised in a fiduciary capacity and in the best interests of this Master Trust and the purposes hereof, namely:

7.01 Registration of Securities. To hold any stocks, bonds, securities, andlor other property in the name of a nominee, in a street name, or by other title-holding device, without indication of~st and generally to exercise the powers of an owner, including, without limitation, the power to vote in accordance with instructions provided by the Company, with respect to any such property whether so held or held in its own name, as Trustee.

7.02 Borrowing. To.borrow money in such amounts and upon such terms as the Company may authorize in writing as necessary to carry out the purposes of this Master Trust, and to pledge any securities or other property for the repayment of any such loan as the Company may direct.

7.03 Retention and Removal of Professional and Employee Services. To employ such attorneys, accountants, custodians, engineers, contractors, clerks and agents as may be reasonably necessary to carry out the purposes of this Master Trust. The reasonable cost of any such employment shall be an Administrative Expense.

7.04 Delegation of Ministerial Powers. To delegate to other persons such ministerial powers and duties as the Trustee may deem to be advisable.

7.05 Powers of Trustee to Continue Until Final Distribution. To exercise any of such powers after the date on which the principal and income of the Funds under the Master Trust shall have become distributable and until such time as the entire principal of, and income from, the Master Trust shall have been actually distributed by the Trustee. It is intended that distribution of the assets of one or more of the Funds under the Master Trust will occur as soon as possible after termination of the Master Trust or any Fund.

7.06 Discretion in Exercise of Powers. To do any and all other acts which the Trustee

shall deem proper to effectuate the powers specifically conferred upon it by this Agreement,

. provided, however, that the Trustee may not do any act or participate in any transaction which would:

(a) Contravene any provision of this Agreement; or (b) Violate the terms and conditions of any instructions provided in a written statement of the Company. .

14 L1BC/1548679.7

7.07 Deposit of Funds. To deposit funds in interest bearing account deposits maintained by or savings certificates issued by the Trustee in its separate corporate capacity, or in any other banking institution affiliated with the Trustee; provided, however, that, the assets of the Qualified Fund may only be so deposited ifthe requirements of Applicable Tax Law are met.

7.08 Loaning of Securities. To loan securities to brokers or dealers or other borrowers Wlder such terms and conditions as the Company authorizes pursuant to a separate agreement.

7.09 Retention of Uninvested Cash. To hold tminvested cash awaiting investment and such additional cash balances as it shall deem reasonable or necessary, without incurring any liability for the payment of interest thereon.

ARTICLE VIII.

INVESTMENTS 8.01 General Investment Powers. The Company may appoint one or more investment managers, which may include the Trustee, but shall not include the Company, to direct the investment of all or part of the Master Trust and, as to the Qualified Fund, in accordance with the limitations set forth in Applicable Tax Law; provided, however, that such investments are in confonnance with the permitted investments as set forth in Exhibit A. (Each such investment manager is referred to herein as an "Investment Manager" and collectively as "Investment Managers.") The Company shall also have the right to remove such Investment Manager(s).

Whenever such appointment is made, the Company shall provide written notice of such appointment to the Trustee, shall specify the portion of the Master Trust with respect to which the Investment Manager has been designated, and shall instruct the Trustee to segregate into specified accounts those assets designated for management by each Investment Manager (each such account is referred to herein as an "Investment Account"). To the extent that assets are segregated into an Investment Account, the Trustee shall be released and relieved of all investment duties. responsibilities and liabilities customarily or statutorily incident to a trustee with respect to the assets in each such Investment Account, and as to such Investment Account the Trustee shall act as custodian. The Company shall cause the Investment Manager to certify in writing to the Trustee the identity of the person or persons authorized to give instructions or directions to the Trustee on behalf of such Investment Manager and to provide specimen signatures of such persons. The Trustee may continue to rely upon and comply with all such certifications unless and until otherwise notified in writing by the Company or an Investment Manager, as the case may be. Notwithstanding anything else in this Agreement to the contrary, including, without limitation, any specific or general power granted to the Trustee and to the

.Investment Managers, including the power to invest in real property, no portion of the Funds

. shall be invested in real estate. For this purpose "real estate" includes, but is not limited to, real property, leaseholds or mineral interests.

8.02 Direction by Investment Manager(s).

(a) An Investment Manager designated by the Company to manage an Investment Account shall have authority to manage and to direct the acquisition and disposition of the assets of the Master Trust, or a portion thereof. as the case may be, and the Trustee shall 15 L1BC/IS48679.7

exercise the powers set forth in Article VIII only when, if, and in the manner directed by the Company in writing, and shall not be under any obligation to invest or otherwise manage any assets in the Investment Account. An Investment Manager shall have the power and authority, exercisable in its sole discretion at any time, and from time to time, to issue and place orders for the purchase or sale of portfolio securities directly with qualified brokers or dealers. The-Trustee, upon proper notification from an Investment Manager, shall settle the transactions in accordance with the appropriate trading authorizations. The Company shall cause each Investment Manager to promptly provide to the Trustee written notification of each transaction and shall cause each such Investment Manager to confinn in writing (or cause the broker or dealer to confirm in writing) the settlement of each such transaction to the Trustee and to the Company. Such notification shall be proper authority for the Trustee to pay for portfolio securities purchased against receipt thereof and to deliver portfolio securities sold against payment therefor, as the case may be. All directions to the Trustee by an Investment Manager shall be in writing and shall be signed by a Prrson who has been certified by such Investment Manager pursuant to Section 8.01 as lluthorized to give instructions or directions to the Trustee.

(b) Should an Investment Manager at any time elect to place security transactions directly with a broker or a dealer, the Trustee shall not recognize such transaction unless and until it has received instructions or confinnation of such fact from an Investment Manager. Should an Investment Manager direct the Trustee to utilize the services of any person with regard to the assets under its management or control, such instructions shall be in writing and shall specifically set forth the actions to be taken by the Trustee as to such services. In the event that an Investment Manager places security transactions directly or directs the utilization of

a. service, such Investment Manager shall be solely responsible for the acts of such persons. The soie duty of the Trustee as to such transactions sha.ll be incident to its duties as custodian.

(c) The authority of an Investment Manager and the tenns and conditions of the appointment and the retention of an Investment Manager shall be the sole responsibility of the Company, and the Trustee shall not be deemed to be a party or to have any obligations under any agreement with an Investment Manager. Any duty of supervision or review of the acts, omissions or overall perfonnance of each Investment Manager shall be the exclusive responsibility of the Company, and the Trustee shall have no duty to review any securities or other assets purchased by an Investment Manager, or to make suggestions to an Investment Manager or to the Company with respect to the exercise or nonexercise of any power by an Investment Manager. Notwithstanding the foregoing, except in connection with the requirement that investments be in Investment-Grade Securities, the Trustee shall review all transactions of which it is notified by an Investment Manager to determine if such transactions are in conformance with the pemritted investments as set forth in Exhibit A, and if they are not, to so notify the Company and the Investment Manager.

8.03 Trustee's General Investment Powers.

(a) The Trustee recognizes the authority of an Investment Manager to manage, invest, and reinvest the assets in an Investment Account pursuant to an investment manager agreement and as provided in this Article VIII, and the Trustee agrees to cooperate with any Investment Manager as deemed necessary to accomplish these tasks. Notwithstanding the foregoing, to the extent that the assets of the Master Trust have not been segregated into an 16 LIBCl1548679.7

Investment Account to be invested by an Investment Manager, the Trustee may agree to conduct the day-to-day investment management of such assets in accordance with the written general investtnent instructions of the Company and, as to the Qualified Fund, in accordance with the limitations set forth in Applicable Tax Law.

(b) Nothing in this Agreement shall restrict the Trustee, in its individual capacity, from acting as an agent for, providing banking, investment advisory, investment management and other services to, and generally engaging in any kind of business with others (including, without limiting the generality of the foregoing, issuers of securities, of money market instruments or of other property purchased by or on behalf of the Master Trust or any of the Funds) to the same extent as ifit was not the Trustee hereWlder. Nothing in this Agreement shall in any way be deemed to restrict the right of the Trustee, in its individual capacity, to perfonn services for any other person or entity, and the performance of such services for others will not be dee:q:ted to violate or give rise to any duty or obligation to the Company or the Master Trust ~ot speci~cally undertaken by the Trustee hereunder. Nothing in this Agreement shall limit or restrict the Trustee, in its individual capacity, or any of its officers, affiliates or employees from buying, selling or trading in any securities for its or their own accounts. The Trustee, in its individual capacity, its officers, employees or affiliates, and its other clients may at any time have, acquire, increase, decrease or dispose of positions in investments which are at the same time being acquired or disposed of for the account of the Master Trust or one or more of the Funds. The Trustee shall have no obligation to acquire for the Master Trust or any of the Funds a position in any property which it ~cquires in its individual capacity, Of which its officers, employees or affiliates may acquire for its or their own accoWlts or for the account of a client The Trustee may invest in any collective, common or pooled trust fund operated or maintained exclusively for the commingling and collective investment of monies or other assets including any such fimd operated or maintained by the Trustee or an affiliate. The Company expressly understands and agrees that any such collective fund may provide for the lending of its securities by the collective fund trustee and that such collective fund trustee will receive compensation for the lending of securities that is separate from any compensation of the Trustee hereunder, or any compensation ofthe collective fund trustee for the management of such collective fund. The Trustee is authorized to invest in a collective fund which invests in Mellon Financial Corporation stock in accordance with the tenns and conditions of the Department of Labor Prohibited Transaction Exemption 95-56 (the "Exemption") granted to the Trustee and its affiliates and to use a cross-trading program in accordance with the Exemption. The Company acknowledges receipt of the notice entitled "Cross-Trading Infonnation", a copy of which is attached to this Agreement as Exhibit C. The Trustee may purchase, enter, sell, hold, and generally deal in any manner in and with contracts for the immediate or future delivery of financial instruments of any issuer or of any other property; to grant, purchase, sell, exercise, permit to expire, pennit to be

. ~held in escrow, and otherwise to acquire, dispose of, hold and generally deal in any manner with and in all fonns of option in any combination.

17 L1BelJ 548679.7

ARTICLE IX.

MISCELLANEOUS 9.01 Headings. The section headings set forth in this Agreement and the Ta~le of Contents are inserted for convenience of reference only and shall be disregarded in the construction or inteIJlretation of any of the provisions oftrus Agreement.

9.02 Interpretation. When a reference is made in this Agreement to an Article, Section, Schedule or Exhibit, such reference shall be to an Article or Section of, or Schedule or Exhibit to, this Agreement unless othetwise indicated. Any word contained in the text of this Agreement shaH be read as the singular or plural and as the masculine, feminine, or neuter as may be applicable or pennissible in the particular context. Unless othetwise specifically stated, the word "person" shaI1 be taken to mean and include an individual, partnership, association, trust, company or corporation.

I 9.03 Severability of Provisions. If any provision of this Agreement or its application to any person or entity or in any circumstances shall be invalid and unenforceable, the application of such provision to persons and in circumstances other than those as to which it is invalid or unenforceable and the other provisions of this Agreement, shall not be affected by such invalidity or unenforceability.

9.04 Delivery of Notices Under Agreement. Any notice, direction or instruction required by this Agreement to be given to the Company or the Trustee shall be deemed to have been properly given when delivered by personal service, mailed, postage prepaid, by registered or certified mail, to the person to be notified as set forth below:

If to the Company:

Entergy Nuclear Vermont Yankee, LLC do Entergy Nuclear Operations, Inc.

440 Hamilton Avenue White Plains,NY 10601 Fax No.: 914-272-3205 Attention: Chief Operating Officer with a copy to:

Entergy Nuclear, Inc.

P.O. Box 31995 Jackson, MS 39286-1995 Attention: Assistant Secretary If to the Trustee:

Mellon Bank, N.A.

500 Grant Street, Room 1320 18 UBCIl 548679.7

Pittsburgh, PA 15258 Attention: Mr. Glen Metzger The Company or the Trustee may change the above address by delivering notice thereof in writing to the other party.

9.05 Alterations and Amendments.

(a) The Trustee and the Company understand and agree that modifications or amendments may be required to this Agreement, and to the exhibits hereto, from time to time to effectuate the purpose of the Master Trust and to comply with Applicable Law, Applicable Tax Law, any Order, any changes in tax laws, Regulations or rulings (whether published or private) of the Service and any similar state taxing authority, and any other changes in the laws applicable to the Company or the Station. TIris Agreement, and the exhibits hereto may be altered or amended to the extent necessary or advisable to effectuate such purposes or to comply with such Applibble Law, Applicable Tax Law, Order or changes.

(b) Except as provided in clause (a) and (d) of this Section 9.05, this Agreement, and the exhibits hereto, may be amended, modified, or altered for any purpose requested by the Company so long as such amendment, modification, or alteration does not affect the use oftbe assets of any Fund to pay the costs of Decommissioning. Notwithstanding the foregoing, this Agreement shall not be, amended so as to violate Code Section 468A or the Regulations thereunder, as amended from!time to time.

(c) Any alteration or amendment to, or modification of, this Agreement or an exhibit hereto must be in writing and signed by the Company and the Trustee. The Trustee shall execute any such alteration, modification, or amendment required to be executed by it and shall accept and be governed by any amended, modified or altered schedule delivered to it but shall have no duty to inquire or make any investigation as to whether any amendment, modification or alteration is consistent with this Section 9.05.

(d) Notwithstanding anything in this Section 9.05 to the contrary, this Agreement cannot be amended in any material respect without (30) days' prior written notice to the NRR Director; provided, however, that if the Company receives prior written notice of objection from either the NRR Director or the Nuclear Safety Director, as appropriate, no such material amendment, modification or alteration shall be made.

(e) Notwithstanding anything in this Section 9.05 to the contrary, no amendment, modification or alteration ofthis Agreement shall become effective unless the

. Company shall have provided at least thirty (30) days' notice to the State ofVennont Public

. Service Board and the State of Vermont Department of Public Service (or their successors, if any) of its intent to amend, modify or alter this Agreement. In addition, the Company shall not amend, modify or alter any of the tenns of Sections 5.01 and 5.02 without the prior approval of the State of Vermont Public Service Board.

19 L1BC/! 548679.7

9.06 Successors and Assigns. Subject to the provisions of Sections 2.09 and 6.01, this Agreement shall be binding upon and inure to the benefit of the Company, the Trustee, and their respective successors, assigns, personal representatives, executors and heirs.

9.07 Governing Law; Jurisdiction; Certain Waivers.

(a) This Agreement, the Master Trust and all questions pertaining to their validity, construction, and administration shall be interpreted, construed and detennined in accordance with the internal substantive laws (and not the choice oflaw rules) of the Connnonwealth of Pennsylvania to the extent not superseded by federal law . All actions and proceedings brought by the Trustee relating to or arising from, directly or indirectly, this Agreement may be litigated in courts located in the Commonwealth of Pennsylvania and the Company hereby submits to the jurisdiction of such courts. The Company and the Trustee hereby waive the right to a trial by jury in any action or proceeding brought hereunder.

(b) To the extent that, in any jurisdiction, the Company has or hereafter may acquire, or is or hereafter may be entitled to claim, for itself or its assets, immunity (sovereign or otherwise) from suit, execution, attachment (before or after judgment) or any other legal process brought by or on behalf of the Trustee and arising with respect to this Master Trust or the Trustee's functions hereunder, the Company irrevocably agrees not to claim, and hereby waives, such immunity.

i 9.08 Accounting Year. The Master Trust shall operate on an accounting year that coincides with the calendar year, January 1 through December 31.

9.09 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument 9.10 Decommissioning Liability. Nothing in Agreement or in any supplement to this Agreement is intended to impose any responsibility on the Trustee for overseeing or paying the cost of the Decommissioning of the Station, other than the disbursement of funds in accordance with Article IV.

20 L1BC/1548679.7

9.11 Limitation on Liability of Trustee. Notwithstanding anything in this Agreement to the contrary, the Trustee shall not be responsible or liable for itS failure to perfonn under this Agreement or for any losses to the Funds resulting from (a) any event beyond the reasonable control of the Trustee, its agents or subcustodians, including but not limited to nationalization, strikes, expropriation, devaluation, seizure, or similar action by any Governmental Autherity, de facto or de jure. or (b) enactment, promulgation, imposition or enforcement by any such Governmental Authority of currency restrictions. exchange controls, levels or other charges affecting the Funds' property, or (c) the breakdown, failure or malfunction of any utilities or teleconununications systems, or (d) any order or regulation of any banking or securities industry including changes in the market rules and market conditions affecting the execution or settlement of transactions, or (e) acts of war, terrorism, insurrection or revolution, or (f) acts of God; or any other similar event. This Section 9.11 shall survive the tennination of this Agreement.

9.12 Representation. The Company and the Trustee hereby each represent and warrant to the other thalj it has full authority to enter into this Agreement upon the terms and conditions hereof and that the individuals executing this Agreement on its behalf have the requisite authority to bind the Company and the Trustee to this Agreement.

21 LlBCl1548679.7

IN WITNESS WHEREOF, the Company and the Trostee have set their hands and seals to this Agreement as of the day and year first above written.

ENTERGY NUCLEAR VERMONT YANKEE,LLC BY:~N-:-am--+>t~ 6=:-c-.{ft/"--C-N-:j-t-"V<<--....!..--

"'::"St-ev=e-'n

Title:

Vice President and Treasurer Attest: ~JrJa. fafULr Name: Michael A. Caruso

Title:

Assistant Treasurer MELLON BANK, N.A., as Trustee

!2-t,t'I-,{.

By: ________

Name:

&'L..--iq;_.f.,.(/J_

Ti..... R. lraus, Vice Presi:.r Millon '1fI1c, NA.

Attest:~i

~G~AJ~

~

Title:

AVP S-l LIBC/1548679.7

STATE OF LOmSIANA )

) 5S:

PARISH OF ORLEANS )

I, /Jut J .6.( Y , a Notary Public in and for the aforesaid jurisdiction, do hereby certify that Steven C. McNeal and Michael A. Caruso, who are personally known to me to be the persons who executed the foregoing Entergy Nuclear Vermont Yankee, LLC Master Deconunissioning Trust Agreement, personally appeared before me in the aforesaid jurisdiction, and as Vice President and Treasurer and Assistant Treasurer ofENTERGY NUCLEAR VERMONT YANKEE, LLC, and by virtue ofthe power and authority vested in them, acknowledged the same to be the act and deed ofENTERGY NUCLEAR VERMONT YANKEE, LLCJand they executed the same as such.

Given ~der my hand and seal this L~ of July, 2002.

My commission is for life L1BC/IS48679.7

C0M1v10NWEALTH OF PENNSYLVANIA )

) 5S:

COUNIYOF A\\.e~,n'-X )

CJJ I}:, \..\..\.i.L .A:yt\1 t'1o;~ Notary Public in and for the aforesaid jurisdiction, do hereby certify that B\ \). ' 'R - ¥-,1Q.llS and G, \Q II 1\. ~..\-~~l, who are personally known to me to be the persons who executed the foregoing Entergy Nu~ar Vennont Yankee, LLC Master DecoII1II1issioning Trust A~eement, personally appeared be}~e ~e in the aforesaid jurisdiction, andas \)~Ce- ~~~"'i-\ and As~* \)\'Ca \~'XbotMELLONBANK.N.A.,

and by virtue of the power and authority v""ts'ted in them, acknowledged the same to be the act and deed MELLON BANK, N.A., and they executed the same as such.

\:\-.-

Given under my hand and seal this 3 (}.' day of July, 2002.

tl0t'¥r Public Cemmonwealth ofPeIUlSylvania My commission expires C'C -t \?J .;)C:O :)

No~arial Seal .

Juiie Ann Mosco, Notary Public Pittsburgh. AlleQheny County My Commission Expires Oct. 13. 2003 Member. PennsYlVania .A,SSQ::~!!on 0\ No\aries L1BC/1548679.7

EXHIBIT A PERMITTED INVESTMENTS Pennitted investments for both the Qualified Fund and the Nonqualified Fund(s).shaU be any investments in Investment-Grade Securities pennitted by Applicable Law; provided that, subject to clarification, if any, by the NRC, investments in securities settled or safekept outside of the United States shall be prohibited and provided further that investments in the securities or other obligations ofEntergy Corporation and its affiliates or subsidiaries, successors or assigns shall be prohibited. In addition, except for investments tied to market indexes or other non-nuclear sector mutual funds, investments in any entity owning one or more nuclear power plants are prohibited. Pennitted investments include investments tied to market indexes, mutual funds or common trust funds which may hold securities issued by Entergy Corporation, its affiliates and subsidiaries.

Exhibit A-I LlBC/! 548679.7

EXHIBITB DECOMMISSIONING CERTIFICATE NO.

The undersigned Authorized Representative of Entergy Nuclear Vennont Yankee, LLC, a Delaware limited liability company (the "Company"), being duly authorized and empowered to execute and deliver this Decommissioning Certificate, hereby certifies that payments in the amounts and to the payees listed below are for obligations duly incurred by the Company for the Decommissioning of the Vennont Yankee Nuclear Power Station under Applicable Law or for Spent Fuel Costs or Site Restoration Costs or Docket 6545 Decommissioning Activities, to the extent pennitted by the Master Trust, and bereby directs the Trustee of the Entergy Nuclear Vennont Yankee Master Decommissioning Trust, pursuant to Article IV of the Master Trust Agreement to pay to each payee listed, including the Company if so listed, (payees) in Exhibit 1 hereto, the amo~ts set forth therein, and certifies that the payments requested are proper expenditures ofllie Master Trust.

Accordingly, request is hereby made that the Trustee provide for the withdrawal of

$ from the (QualifiedINonqualified) Fund [and Subaccount(s)] in order to permit payment of such sum to be made to the Payees. You are further requested to disburse such sum, once withdrawn, directly to such Payees in the following manner: [CHECKIWIRE TRANSFER! J on or befQre , 20_.

ENTERGY NUCLEAR VERMONT YANKEE,LLC By: _ _ _ _ _ _ _ _ _ _ _ __

Name:

Authorized Representative i

/'

Exhibit B-1 LlBC1I548679.7

EXHIBITC CROSS-TRADING INFORMATION As part of the cross-trading program covered by the Exemption for the Trustee and its affi1iates, the Trustee is to provide to each affected Trust the following information:

I. The existence of the cross-trading program The Trustee has developed and intends to utilize, wherever practicable, a cross-trading program for Indexed Accounts and Large Accounts as those terms

¥e defined in the Exemption.

II. The "triggering events" creating cross-trade opportunities In accordance with the exemption three triggering events" may create opportunities for cross-trading transactions. They are generally the following (see the Exemption for more information):

A. A change in the composition or weighting of the index by the independent organization creating and maintaining the index; B. A change in the overall level of investment in an Indexed Account as a result of investments and withdrawals of the account's opening date, where the Account is a bank collective fund, or on any relevant date for non-bank collective funds; provided, however, a change in an Indexed Account resulting from investments or withdrawals of assets of the Trustee's own plans (other than the Trustee's defined contribution plans under which participants may direct among various investment options, including Indexed Accounts) are excluded as a "triggering event"; or C. A recorded declaration by the Trustee that an accumulation of cash in an Indexed Account attributable to interest or dividends on, and/or tender offers for, portfolio securities equal to not more than 0.5% of the Account's total value has occurred.

ill. The pricing mechanism utilized for securities purchased or sold Securities will be valued at the current market value for the securities on the date ofthe crossing transaction.

Exhibit C-l L1BC/IS48679.7

Equity securities - the current market value of the equity security will be the closing price on the day of trading as determined by an independent pricing service; unless the security was added to or deleted from an index after the close of trading, in which case the price will be the operungprice for that security on the next business day after the announcement of the addition or deletion..

Debt securities - the current market value of the debt security will be the price determined by the Trustee as of the close of the day of trading according to the Securities and Exchange Commission's Rule 17a-7 (b)(4) under the Investment Company Act of 1940.

Debt securities that are not reported securities or traded on an exchange will be valued based on an average ofthe highest current independent bids and the lowest current independent offers on the day of cross-trading. The Trustee will use r¢asonable inquiry to obtain such prices from at least three independent sources that are brokers or market makers. If there are fewer than three independent sources to price a certain debt security, the closing price quotations will be obtained from all available sources.

IV. The allocation methods Direct cross-trade opportunities will be allocated among potential buyers or sellers of debt or equity securities on a prorata basis. With respect to equity securities, please note the Trustee imposes a trivial share constraint to reduce excessive custody ticket charges to participating accounts.

V. Other procedures implemented by the Trustee for its cross-trading practices The Trustee has developed certain internal operational procedures for cross-trading debt and equity securities. These procedures are available upon request.

Exhibit C-2 LIBCl1548679.7

EXHlBITD DECOMMISSIONING REQUIREMENTS Upon Completion of Decommissioning (as defined below) of the Station. any Excess Funds remaining in the decommissioning trust funds transferred from VYNPC or the VYNPC Trust Funds pursuant to the Purchase and Sale Agreement, including any gains, losses or fees on the trust funds while held in a fund hereunder ("transferred trust funds") shall be distributed in accordance with the tenns hereof. The Completion of Decommissioning is defined for the purposes of this Exhibit D as plant dismantlement and decontamination to NRC standards plus the completion of additional activities agreed to or imposed in the course of Docket No. 6545 before the Vermont Public Service Commission or pursuant I to any subsequent law or proceeding, but excluding spent fuel management and any site restoration ("Docket 6545 Decommissioning Activities"). Completion of Decommissioning shall be deemed to have occurred for purposes hereof notwithstanding that the Company may choose to Ie-use the Site, and portions of e~isting structures, systems and components, and that spent fuel is not removed from the Site. Site restoration shall mean that, once the Site is no longer used for nuclear pwposes or non-nuclear commercial. industrial or other similar uses consistent with; the orderly development of the property, the Site will be restored by removal of all structures and, if appropriate, regrading and reseeding the land.

Return of Excess Funds in accordance with the second following paragraph, shall occur following the earliest of (i) the date Completion of Decommissioning has occurred and the Company has satisfied alI of its responsibilities for spent fuel management and site restoration or (ii) the date on which Completion of Decommissioning occurs and any of the following occur: (x) settlement between the Company and the US Department of Energy ("DOE") with respect to spent fuel management responsibilities for the Station, (y) final resolution of litigation by the Company against DOE with respect to spent fuel management responsibilities for the Station, or (z) satisfactory perfozmance by DOE of its spent fuel responsibility with respect to the Station.

Excess Funds shall mean any funds remaining in the transferred trust funds following the Completion of Decommissioning, less those funds necessary for management of spent nuclear fuel (including reasonable contingencies for delays

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in removal of the spent fuel from the Site, or cost overruns associated with the storage or removal of the spent fuel) (the "Spent Fuel Costs") and site restoration costs not otherwise payable by the federal govenunent in accordance with (x), (y) or (z) above (the "Site Restoration Costs"). Excess Funds shall not include any amounts contributed by the Company after the date of this Agreement pursuant to Section 3.01, or any amounts of net income in respect of such amounts, all of which amounts are to be distributed to the Company upon liquidation of the assets of the Master Trust.

Exhibit D-l LlBC11548679.7

Subject to the assignment provisions of Section 5.03 of the Master Trust, the Excess Funds remaining shall be paid to VYNPC for the benefit of electric consumers in pro rata shares in proportion to the stated ownership percentage of the Sponsors set forth on Exhibit E. In the event VYNPC shall have ceased to exist at the time Excess FWlds are to be distributed as provided above, the Company shall notify the State of Vennont Public Service Department and the state public utility commission or comparable regulatory body. that either presently exercises or formerly exercised rate regulation authority over each Sponsor which is entitled to a distribution, that the pro rata share of Excess Funds is available. Upon compliance with the instructions of each such state public utility conunission or comparable regulatory body, the Company and the Trustee holding such funds shall have no further obligation with regard to the Excess Funds or their distribution.

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Exhibit D-2 LIBCI) 548679.7

EXHIBITE Central Vennont Public Service Corporation 35.0%

Green Mountain Power Corporation 20.0%

New England Power Company 22.5%

The Connecticut Light and Power Company 9.5%

Central Maine Power Company 4.0%

Public Service Company of New Hampshire 4.0%

Western Massachusetts Electric Company 2.5%

Cambridge Electric Light Company 2.5%

Exhibit E-1 L1BClJ 548679.7

EXHIBITF Mellon Bank, N.A.

500 grant Street, Room 1320 Pittsburgh, PA 15258 Attn: Mr. Glen Metzger

Dear Mr. Metzger:

Reference is mgde to the Entergy Nuclear Vennont Yankee, LLC Master Decommissioning Trust Agreement for Vennont Yankee Nuclear Power Station dated July _, 2002. Pursuant to Section 5.03 of such Master Trust, the undersigned hereby notifies you that it has irrevocably assigned its right to receive "Excess Funds" under the Master Trust to , its successors and assigns.

[Sponsor]

I

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Exhibit F-I LIsen 548679.7

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