ML20247D720

Joint Stipulation Calling for Alabama Power Co to Offer to Sell Portion of Units to Alabama Electric Cooperative,Inc

ML20247D720
Person / Time
Site:	Farley
Issue date:	04/25/1989
From:	Shea K ALABAMA ELECTRIC COOPERATIVE, INC.
To:
Shared Package
ML20247D716	List: ML20247D709 ML20247D720
References
A, NUDOCS 8905250573
Download: ML20247D720 (10)

Text

. _ _ _ . _

y . . .

1?

L 9 ,

c[ UNITED STATES OF AMERICA '

a ' <

NUCLEAR REGULATORY COMMISSION Before the Director of the Office of Nuclear Reaction-Regulation In'the Matter of. )

)

ALABAMA. POWER COMPANY ) Docket Nos. 50-348A'

) 50-364A (Joseph M.'Farley' Nuclear )

-Plant, Units 1 and 2) )

1 JOINT STIMULATION l

Alabama Power Company (APCO) and Alabama Electric Cooperative, Inc. (AEC) hereby' jointly stipulate as follows:

1. .The Operating Licenses issued by the Nuclear; Regulatory Commission >(No. NPF-2-and NPF-8) which pertain to APCO's Joseph'M.

Farley Nuclear Plant, Units 1 and 2, (Farley) contain License Condition No. 2.. That Condition calls for APCO to offer to sell a portion of the Farley units to AEC at a price to be " established by the' parties through good faith negotiations" in an amount which "shall be sufficient.to fairly reimburse" APCO for its " total l

L costs" related to the units.

2. Following negotiations between APCO and AEC pursuant to Condition No. 2, APCO and AEC agreed to settle that Condition by h entering into certain agreements with regard to ownership and l operation of the C?mes H. Miller, Jr. Steam Electric Generating Plant, Units 1 and 2 (the Facilities). APCO and AEC have entered 1 '

( into a Purchase and Ownership Agreement dated as of November 18, L i l 1988, for the sale by APCO to AEC of an ownership interest in the i 8905250573 890505 PDR ADOCK 05000348 -

M P NU .  ;

. .- 1

Facilities. APCO and AEC have also executed an Operating Agreement dated as of November 18, 1988, providing for operation of the jointly-owned Facilities, and a Supplement to both Agreements dated as of March 1, 1989.

3. On April 25, 1989, AEC executed the " Release and Covenant Not to Sue" attached hereto which, inter alia, records AEC's agreement that (a) APCO's commitments reflected in the Purchase and Ownership Agreement and Operating Agreement referred to in Paragraph 2 above constitute full satisfaction of the requirements that were placed on APCO in Condition No. 2 of the Farley Operating Licenses No. NPF-2 and NPF-8 issued by the NRC and (b) AEC will not seek to enforce Condition No. 2 in any proceeding before the NRC or elsewhere, subject to paragraph 4 of the Release and Covenant Not to Sue, which provides "that in the event APCO fails, without legal justification, to complete the Closing in accordance with the provisions of the Purchase and Ownership Agreement, this Release shall be abrogated and AEC shall have the right to reinstitute or reopen the proceeding before the NRC relating to the alleged violation of Antitrust License Condition 2 by APCO."

4. The controversy which led AEC to petition the NRC pursuant to 10 C.F.R. S 2.206 on June 29, 1984, to enforce License Condition No. 2 has been fully resolved and no NRC action to enforce that Condition is appropriate. The Notice of Violation L __ _ ____ ______.___ __ )

r .

4.; ,

r - Oh issued by the NRC on June' 16, 1986, may therefore be withdrawn and

-.the~ proceeding with respect thereto terminated.

Respectfully submitted, Balch &. Bingham-600 North 18th Street Birmingham, Alabama 35203

~

Newman'& Holtzinger, P.C. Volpe, Boskey and Lyons

'1615 L Street, N.W., Suite 1000 918.16th Street,'N.W.

Washin ton,'D.C. 2 036 Washington, D.C. 20006

~By:

- O By ' D.

1. Ai#V4

'.Kdthleen H. Shea Biard MacGuineas-

~

Attorneys for.' Alabama Power Attorneys for Alabama Company. Electric Cooperative, Inc May 5, 1989

~

,, .a.

p J:  :<-

• L RELEASE AND COVENANT'NOT TO SUE THIS RELEASE AND COVENANT NOT TO SUE (hereinafter " Release"),

~

made' and entered into this 2$thday of- April ,1989 by Alabama Electric Cooperative, Inc.-("AEC").

t WITNESSETH:

WHEREAS,-AEC and Alabama Power Company ("APCO") have entered into a Purchase and' Ownership' Agreement dated as of. November 18, 1988. for the sale by APCO to AEC of an undivided ownership interest in the James H. Miller, Jr. Steam Electric Generating Plant, Units 1 and 2-(the " Facilities"); and WHEREAS, AEC and APCO have also executed an Operating Agree-ment' dated as of November 18, 1988 providing for the operation of the jointly owned Facilities; and WHEREAS, the agreements were offered by APCO in settlement of

Antitrust License Condition 2 to the nuclear operating licenses issued by the Nuclear Regulatory Commission for APCO's Joseph M.

Farley Nuclear Plant that required APCO to offer to sell to AEC an ownership interest in Plant Farley as a consequence of proceedings under section 105c of the Atomic Energy Act of 1954, a copy of such Antitrust License Condition being attached hereto and made a part hereof by reference; and l

WHEREAS, APCO's agreement to the Purchase and Ownership Agree- I ment, and the Operating Agreement, was predicated on receipt from

' AEC of a Release and Covenant Not to Sue as to matters forming the basis for the NRC's requirement for sale of an ownership interest in the Farley Nuclear Plant;- )

p , s e

NOW, THEREFORE, in consideration of the mutual covenants, agreements, warranties and representations set forth herein and in the Purchase and Ownership Agreement and the Operating Agreement, AEC, on behalf of or for itself and any person or entity claiming by, through or under it, agrees as follows:

1. AEC acknowledges and agrees that APCO's commitments reflected in the Purchase and Ownership Agreement and the operating Agreement constitute full satisfaction of the requirements that were placed on APCO in Antitrust License Condition 2, and that it will not seek te enforce Antitrust License Condition 2 in any proceeding before the NRC or elsewhere.

2. AEC unconditionally remises, releases, and forever discharges APCO, its successors and assigns, and its past and present officers, directors, agents and employees, from all claims, demands, causes of action, obligations, damages and liabilities of every type and description, including, without restricting the generality of the foregoing, all claims for costs, expenses, attorney's fees and all other related or similar claims of whatever kind, whether now known or hereafter discovered, which are based in whole or in part or arise out of any conduct, act, practice or omission or any other matter prior to the effective date of this Release and is claimed to violate or be inconsistent with the anti-trust laws and which was or which could have been considered by the Atomic Safety and Licensing Board, the Atomic Safety and Licensing Appeal Board or the Nuclear Regulatory Commission in NRC Docket Nos. 50-348A and 50-364A or which formed the basis for the 1

2 l l

l

,. ; .. o 4

establishment of Antitrust License Condition 2 by the Atomic Safety and Licensing Appeal' Board in its Order dated June 30, 1981. AEC further covenants that it will not bring, commence, . initiate, main-tain, assist, participate in or prosecute any action at law, pro-ceeding in equity, or any other proceeding (including, without limitation, proceedings at or before the Nuclear Regulatory Commission) or claim for damages or relief of any kind or descrip-tion, whether now known or hereafter discovered, against APCO, its successors and assigns, and its past and present officers, directors, agents and employees, based in whole or part on or arising out of any conduct, act, practice or omission or any other matter or event which occurred or is alleged to have occurred and -

which was or which could have been considered by the Atomic Safety and Licensing Board, the Atomic Safety and Licensing Appeal Board or the Nuclear Regulatory Commission in NRC Docket Nos. 50-348A and 50-364A or which formed the basis for requiring Antitrust License Condition 2 by the Atomic Safety and Licensing Appeal Board in its Order dated June 30, 1981. This Release specifically includes, but is not limited to, any claim, demand, cause of action, obligation, damage or liability, of every type and description, whether now ,

known or hereafter discovered, which is based on, arises out of or relates in any way to any act, practice or omission which formed i

the basis of the requirement imposed in Antitrust License Condition 2 in NRC Docket Nos. 50-348A and 50-364A.

3. This Release may be pleaded as a full and complete defense to, and may be used as the basis for an injunction against, 3

1 1

f.

j,,,...

l any action, suit, claim or other proceeding instituted, prosecuted, j l

attempted or maintained by AEC or any other entity, jointly or j severally, which asserts any claim by or on behalf of AEC. I i

4. AEC acknowledges that this Release is not based upon any i factual, legal or other representations, promises or assurances, oral or otherwise, made by APCO and no'c contained in this document or the Purchase and Ownership Agreement or the Operating Agreement; and AEC expressly assumes the risk that the facts or law with respect to which this Release is executed are or may be found here-after to be different from the facts or law believed by the AEC to be true as of the date of this Release, and agrees that this Release shall be effective notwithstanding any such difference; provided, however, that in the event APCO fails, without legal justification, to complete the Closing in accordance with the provisions of the Purchase and ownership Agreement, this Release shall be abrogated and AEC shall have the right to reinstitute or reopen the proceeding before the NRC relating to the alleged violation of Antitrust License Condition 2 by APCO.

5. AEC agrees that this Release is and shall be binding on the successors and assigns of AEC and any persons or entities claiming through, by or under it, and shall inure to the benefit of APCO and its successors and assigns.

6. This Release is the entire agreement between APCO and the AEC as to the subject matter covered by this Release and any related matters, and cannot be changed or modified except by written agreement between APCO and AEC.

4 L__ ___

g -( f , ',. . .

7. Terms used but not defined herein shall have the meaning

. assigned thereto t.nder the Purchase and Ownership Agreenent.

8. Nothing in this Release shall be construed to release APCO from liability except that based on acts or omissions which occurred prior to the effective date of this Release or which were or could have been considered by the Atomic Safety and Licensing Board, the Atomic Safety and Licensing Appeal Board or the NRC in the establishment of Antitrust License Condition 2.

IN WITNESS WHEREOF, AEC has caused this Release and Covenant Not to Sue to be executed and sealed by its duly authorized representative as of the date first shown above.

ATTEST: ALABAMA ELECTRIC COOPERATIVE, INC.

D-r AM By

/

Secretary //

Title:

President STATE OF ALABAMA:

to-wit:

COVINGTON COUNTY l

The foregoing instrument was acknowledged before me this _25th day of A Pril , 1989 by H. W. Norrim and Jack V. Taylor , J r,1sident and Secretary

, respectively, of Alabama Electric Cooperative, Inc., an Alabama corporation, on behalf of the Corporation, hetaav punue, starr or aLanaui 17 Diist; l My commission expires: ."M. y missioy,3y, pints:7to, i, i ngs, M/20/ PW

/ Notary Public l l

l ) 5 l

w_

{ >-

1 l

I

(

WHEREAS, pursuant to a Memorandum of Understanding between Alabama Electric k Cooperative, Inc. and Alabama Power Company approved by this Board at its meeting i held on August 26, 1988, a Purchase and Ot. lership Agreement has been negotiated l between AEC and Alabama Power under whiQ AEC would acquire an 8.16% interest l in Units 1 and 2 of Alabama Power's James H. Miller, Jr. Steam Electric Generating i Plant located in Jefferson County, Alabama; and )

I WHEREAS, AEC and Alabama Power have also negotiatcd an Operating Agreement {

under which Alabama Power would operate the Miller Steam Plant for AEC and Alabama Power as joint owners of the plant; 6nd WHEREAS, in connection with such Purchase and Ownership and Operating Agreements, the parties have also negotiated an Off-System Generation Agreement providing for transmission service of AEC's share of energy output from the Miller Steam Plant over the transmission f acilities of Alabama Power to AEC's transmission system, Service Schedule AE providing for the purchase of alternate energy by AEC pursuant to Section 5.06 of the Operating Agreement and an Amendment No. 2 to the Interconnection Agreement between AEC and APC amending Service Schedule RP to provide for the sale of reserve peaking capacity by APC to AEC through December 31,1992; and WHEREAS, other exhibits, schedules, certificates, agreements, documents and instruments may be executed in connection with the above described documents; and WHEREAS, under the above described documents AEC would release Alabama Power for all claims against, or conduct by, Alabama Power that may violate or be inconsistent with antitrust laws and which form the basis for the establishment of antitrust license condition number 2 by the Atomic Safety and Licensing Appeal Board in its order dated June 30,1981 and AEC would further covenant not to sue Alabama Power for such matters with the effect that AEC would give up its claim to the right of ownership of a portion of the Farley Nuclear Plant owned by Alabama Power; and WHEREAS, the Board of Trustees of AEC has concluded that the purchase of this interest in the Miller Steam Plant, in lieu of the purchase of an interest in the Farley Nuclear Plant, and the execution of the Release and Covenant Not to Sue, the Purchase and Ownership Agreement, the Operating Agreement and the other documents described above are in the best interest of AEC; NOW, THEREFORE, BE IT RESOLVED, by the Board of Trustees of Alabama Electric Cooperative, Inc., that the officers of this cooperative be authorized and directed j to execute the Purchase and Ownership Agreement, the Operating Agreement, the Release and Covenant Not to Sue, Service Schedule AE, the Off-System Generation Agreement and Amendment No. 2 to the Interconnection Agreement in the form of such documents as presented to this meeting and with such changes, additions or deletions as they may deem appropriate or necessary and with their execution of such documents conclusively evidencing their approval to any such changes, deletions or additions and the r.ficers are further authorized and directed to execute any and all other agreements, contracts, exhibits, schedules, certificates, documents or instruments that they may deem necessary, helpful or appropriate to consummate the purchase of an interest in the Miller Steam Plant and to consummate and carry out the transactions contemplated by this above described agreements; and BE IT FURTHER RESOLVED, that the Rural Electrification Admmistration be requested to approve the Purchase and Ownership Agreement, the Operating Agreement and such other of the above described documents as may be appropriate.

l

r. /

s, c,

. i l

l I, A. G. Palmore, Assistant Secretary of Alabama Electric Cooperative, Inc., hereby certify that the attached is a true i and correct copy of a resolution adopted at the meeting of l l

the Board of Trustees of Alabama Electric Cooperative, Inc.

on October 28, 1988, at which a quorum was present and voted.

I further certify thut none of the said resolution has been altered, modified, or rescinded.

This the 25th day of April, 1989.

SEAL Assistant Secretary

_ _ _ _ _ _ _ _ _ _ _ _ _