ML18026A016

Transmission Agreement Between PP&L and Allegheny Electric Cooperative, Inc

ML18026A016
Person / Time
Site:	Susquehanna
Issue date:	08/11/1978
From:	Pennsylvania Power & Light Co
To:	Office of Nuclear Reactor Regulation
References
Download: ML18026A016 (194)

Text

Transmiss ion Agreement f

Tab 1'e o Contents

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Article I Definitions 2 Article II Conveyance Article III Deposit and Payment Article IV: Construction of Line Article V: Closing and Second Closing 18 Article VI Transmission Operating Costs 20, Article VII Use and Enjoyme'nt 27 Article VIII Bulk Power Transmission Service 29-Article IX Operation, Management and. Maintenance 31 of the Line and Right of Nay Article X Access to Books and Records 32 Article XI Representations and Narranties 33 Article XII Cooperation 34 Article XIII Insurance '35 Article XIV Transfer and Sales Taxes Article XV Conditions Precedent to Closing and 37 Second Closing Article XVI Notice 42 Article XVII Survival 43 Article XVIII Amendments 44 Article XIX Counterparts 45 Article XX Governing Law 46 Article XXI Benefit of Agreement Article XXII Severability Article XXIII Failure to Enforce Provisions of this 49 Agreement Occlreter3~

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Article XXIV No Delay 50 Article XXV Alienation 5 Ass ignment 51 Article XXVI PL's Option to Purchase, the Line 54 Article XXVII Default 56 Article XXVIII Successors, Assigns, Transferees and 58 Grantees Article XXIX Risk 59 Article XXX Recording 60 Article XXXI Filing 61 Article XXXII Term of-this Agreement 62 Article XXXIII Engineering Changes by AE 63 Article XXXIV Progress Reports - Cost Estimates 64 Article XXXV Contingency 65 Article XXXVI Article Headings iVot to Affect i%eaning 66 Article XXXVII Best Efforts 67 Article XXXVIII Buy American 68 Article XXXIX Further Assurances 69'0 Article XL Statutes Article XLI Historical Sites 71 Article XLII Naiver 72 Article XLIII Safety 73.

Article XLIV Flood Hazard Areas Article XLV Congressional Representatives 75 Article XLVI Nonsegregated Facilities 76 Article XLVII Equal Opportunity Clause 78 Article XLVIII Environment 82 Signatures 84

EXHIBITS Exhibit A Deed Exhibit B Bill of Sale Exhibit C Kennedy Family Exhibit D Reduction in Power Delivered Exhibit E Rights and Interests in Property Included in Line Project, Line Additions and Line Exhibit F Handy-Whitman Index

Transmission A reement This Transmission Agreement, entered into thfs 18th day of March, 1977, by and between Pennsylvania Power 5 Light Company, (hereinafter PL), an electric public utility corpora-tion, organized and existing under the laws of the Commonwealth of Pennsylvania, with its corporate headquarters at Two North Ninth Street, Allentown, Pennsylvania 18101 and Allegheny Electric Cooperative, Inc. (hereinafter AE), an electric cooperative corporation, organized and existing under the laws of the Commonwealth of Pennsylvania, with its corporate headquarters at 2929 North Front Street, Harrisburg Pennsyl-vania 17110.

WHEREAS, PL owns a ninety percent and AE owns a ten percent undivided interest, as tenants in common, in the Susque-hanna Steam Electric Station (Susquehanna), Luzerne County, Pennsylvania; and WHEREAS, AE is desirous of owning certain transmission facilities under and subject to the terms of this Transmission Agreement and AE is desirous of receiving a certain bulk power transmission service from PL; and NHEREAS, PL is willing to provide a certain bulk power transmis s ion s ervice to AE.

NON, THEREFORE, in consideration of the premises and covenants herein contained, PL and AE intending to be legally bound hereby, mutually agree and promise as follows:

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Article I: Definitions For the purpose of this Agreement the following terms shall have the following meanings:

ACTUAL CONSTRUCTION COSTS Amounts actually recorded by PL on its accounting books and records for Construction Costs during any par-ticular period.

ACTUAL TRANSMISSION The sum of the following: (1) Opera-OPERATING COSTS tion and Maintenance Costs applicable to the Line; and (2) a monthly charge, both as set forth in Article VI, Subpart A of this Agreement.

AGREEMENT This Transmission Agreement.

ALLOWANCE FOR FUNDS USED The Allowance for Funds Used During DURING CONSTRUCTION Construction of the Line as recorded in PL's accountin'g books and records.

Allowance for Funds Used During Construction is intended to include the terms Allowance for Funds Used During Construction, Interest Charged to Construction, Interest During Construction, Allowance for Other Funds Used During Construction or Allowance for Borrowed Funds Used During Construction as defined in the Uniform System of Accounts For Class A and B Utilities as may be amended from time to time.

BUSINESS DAY Any day other than a Saturday or Sunday or a day on which banking insti-tutions in the Commonwealth of Pennsyl-vania are required by law not to transact banking business.

CLOSING As defined in Article V of this Agreement.

CONSTRUCTION COSTS Payments made or costs incurred (excluding Allowance for Funds Used During Construction) either prior to or subsequent to Closing and Second I

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Closing by or for the account of PL or AE in respect of the Line, in connection with the acquisition, design, construction, placing the Line in service and capital additions removals after placing the Line-

'r in service and costs incurred in connection with or in respect of the Right of Nay and shall include without limitation:

1. All costs and expenses incurred in connection with clearing right, of way prior to construction of the Line, all structures and improve-ments installed on Right of Nay, and all equipment and all temporary facilities; and

2. All costs of labor and services performed or rendered, together with related overhead costs; and

3. All costs associated with the acquisition of materials, supplies, machinery, construction equipment, all other equipment, and apparatus acquired or used (including rental charges for machinery, equipment, or apparatus hired.; and

4. An amount of PL's administrative and general expenses reasonably attributable to the Line and Right of Nay including but not limited to all costs necessary to obtain regulatory, governmental, or other approvals re-lated to the Line and Right of Nay; and

5. All payroll expenses incurred by PL including but not limited to the costs of social security taxes, un-employment insurance expense, and other payroll taxes, group life in-surance, group hospitalization, medical insurance, time off with pay, pension

'lan and. other employee benefit, plan contributions, workmen's compensation, long-term disability insurance, health insurance, accident and dismemberment insurance, and all other fringe benefits accruing to PL's employees or personnel; and

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6. Overheads normally incurred by PL in performing line construction work reasonably attributed to the Line and Right, of Nay; and

7. Sales taxes and real estate taxes; and

8. An equitable'llocation of all costs of owning (including deprecia-tion) .and operating auxiliary supporting facilities of PL which enure to the benefit of the Line and Right of Nay.

AE shall be entitled -to an equitable financial credit for any item which was purchased or leased for the benefit, of the Line, but which item is used either in whole or in part by PL other than for the benefit, of the Line either on a temporary or on a permanent basis, and. such equitable credit shall be an adjustment to Construction Costs for the period during which such item is not used for the benefit of the Line.

ESTIMATED CONSTRUCT ION Amounts which PL reasonably expects COSTS to record on its accounting books and records for Construction Costs during any particular period.

ESTIMATED TRAilSMISSION Transmission Operating Costs which OPERATING COSTS PL reasonably expects to be incurred during any particular period.

LINE As defined. in Article II, Subpart D of this Agreement.

LINE ADDITIONS As defined in Article II, Subpart D of this Agreement.

LINE PROJECT As defined in Article II, Subpart D of this Agreement.

PARTIES PL and AE, PARTY Either PL or AE.

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RIGHT OF 17AY AE's one-third undivided ownership interest in certain real property, real property easements and real property right of way to be conveyed by PL to AE at Second Closing as described in the form of Deed, at tached.

hereto as Exhibit A, plus AE's one-'third undivided ownership interest in those undivided ownership interests in real property, real property ease-ments and real property right of way as may be conveyed by PL to AE or jointly acquired by PL and AE from time to time pursuant to the terms and conditions as set forth in Article IV, Subpart E of this Agreement.

SECOND CLOSING As defined in Article V of this Agreement.

'RANSMISSION OPERATING As defined in Article VI, Subpart A, COSTS of this Agreement.

(End of Article I)

A. At Second Closing PL shall sell and convey and AE shall purchase and accept. the following:

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1. The Right of Nay, as it exists at Second Clos-ing, under and subject to the terms, conditions and restrictions fully set forth .in the form of Deed attached hereto as Exhibit A.

2. The sole ownership of Line Project and Line 4

Additions (as herein defined in this Article I I, Subpart D) .

B. AE shall pay the Purcha'se Price to PL. PL shall execute, acknowledge and deliver to AE the Deed, the form of which is

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attached hereto as Exhibit A, in which AE shall join as Grantee.

C. PL shall exe'cute, acknowledge and deliver the Bill of Sale, substantially in the form of Exhibit B, attached hereto and made a part hereof, in which AE shall join as pur-chaser.

D. Line Project shall include the property listed. on Exhibit E, attached hereto and made a part hereof, which was acquired by PL prior to Closing. Any property included in Line Project, if not physically located on the Right of

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Nay must be specifically designated by PL as being part of Line Project, provided that all property required for the construction and operation of the Line shall be so designated by PL.

Line Additions shall include the property listed on Exhibit E, which was acquired by PL during the period beginning at Closing and endi'ng at Second Closing. Any property included in Line Additions, if not physically located on the Right of Nay must be specifically designated by PL as being part of Line Additions, provided that all property required for the construction and operation of the Line shall be so designated by PL.

Line shall include Line Project, Line Additions and all that property listed on Exhibit E, acquired or to be acquired by PL or AE subsequent to Second Closing. Any property included in the Line acquired subsequent to Second Closing, if not physically located on the Right of Nay must be specifically designated by PL as being part of the Line, provided that all property required for the construction and operation of the Line shall be so designated by PL.

I'End of Article II)

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Article III: De osit and Pa ment A. At Closing, AE shall pay to PL, pursuant to the terms set forth in this Article III, Subpart C, a Deposit on the Pur-chase Price. The Deposit on the Purchase Price (Purchase Price is defined in Article V of this Agreement) is $ 1,105,771.35~

which is the sum of the following:

l. $ 900,000 as consideration for the Right of Nay, as it exists at Closing.

2. Plus an amount equal to the Actual Construction Costs incurred by or for the account of PL, during the period which terminated on January 31, 1977.

3. Plus an amount equal to the Construction Costs which PL estimated were incurred by or for the account of PL during the period February 1, 1977 to February 28, 1977.

4. Plus an amount equal to the actual Allowance for Funds Used During Construction applicable to the amount set forth in this Article III, Subpart A(2), incurred by or for the account of PL during the period which terminated on January 31, 1977.

5. Plus an amount equal to the Allowance for Funds Used During Construction applicable to the amount set forth in this Article III, Subparts A(2) and A(3), which PL estimated will be incurred by or for the account of PL during the period February 1, 1977 to February 28, 1977.

6. Plus interest'n the sum of those amounts set forth in Subparts A(l), A(2), A(3), A(4) and A(5) of this Article III calculated at. the annual rate of 8.255 (using a 360-day year) for the period March 1, 1977 through March 18, 1977.

B. The Deposit on Purchase Price shall be paid to PL at Closing in immediately available funds, by wire transfer of the said Deposit. on Purchase Price to PL's account at The First Pennsylvania Bank, N.A., Philadelphia, Pennsylvania, or to any other bank which PL may designate.

C. On or before March 25, 1977, PL shall notify AE of the actual Construction Costs and the actual Allowance for Funds Used During Construction, for the month of February 1977. Any difference between the sum of'he actual Construction r Costs plus the actual Allowance for Funds Used During Construction for the month of February 1977 and the sum of the estimated Construction Costs and. the estimated Allowance for Funds Used During Construc-tion for the month of February 1977 shall be shown on such notifi-cation. The difference between the actual Construction Costs plus the actual Allowance for Funds Used During Construction and the estimated Construction Costs plus the estimated Allowance for Funds Used During Construction shall be called the Difference.

In the event the Difference is a positive number, AE shall pay said Difference to PL on the tenth day immediately following the day on which AE was notified of such Difference, by wire transfer, of the amount equal to said Difference to PL's account at The First Pennsylvania Bank, N.A., Philadelphia, Pennsylvania or to any other bank which PL may designate. In the event the Difference is a negative number PL shall pay said Difference to AE on the tenth day immediately following the day on which AE was notified of said Difference, by wire transfer, of the amount equal

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to said Di fference to AE ' account at Commonwealth National Bank, Harrisburg, Pennsylvania or to any other bank which AE may designate.

D. PL represents that it has made available and AE hereby acknowledges that it has reviewed or has had the opportunity to review all records made available by PL relating to estimated and actual (l) Construction Costs, and (2) Allowance for Funds Used During'Construction which are included in the Deposit on Purchase Price. PL and AE shall at any time, and in a timely manner, subsequent to Closing make adjustments as may be neces-sary in the Deposit on Purchase Price, except that the amount set forth in this Article III, Subpart A(l) shall not be subject to, adjustment. All adjustments in the Deposit on Purchase Price shall be accounted for as a part of the Construction Costs pur-suant to Article IV of this Agreement in the month in which it is determined that an adjustment is necessary. There shall be added to each adjustment in the Deposit on Purchase Price interest at the annual rate of eight percent (8;) simple interest based on a 360-day year, computed from Closing until the date adjustment is actually accounted for between the Parties hereto.

E. No payment made pursuant to the foregoing provisions of this Article III shall constitute a waiver of any right of AE to contest any cost or any adjustment made by PL. Contest shall mean the right of AE to question either the equitable allocation of any cost or payment which was allocated by PL between the Line and some other PL facility as "contemplated in this Article III of this Agreement or the mathematical accuracy of any cost or payment required to be made by AE as contemplated in this Agreement, but specifically shall not mean the right of AE to question or challenge the appropriateness, desirability or wisdom of any cost, payment, or expenditure made or incurred for the benefit of the Line.

All payments for Estimated Construction Costs made

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subsequent to Closing and prior to Second Closing, interest for the period March 10, 1977 through March 18, 1977, on Estimated Construction Costs for March 1977, and all settlements of Actual Construction Costs during the period beginning at Closing and ending at Second Closing shall be deemed to be Supplemental Deposits on Purchase Price.

(End of Article III) t il I

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Article IV: Construction of Line A. For the purposes of the construction, maintenance and operation of the Line PL shall be the agent of AE.

B. Subsequent to Closing, PL shall construct the Line in accordance with the practices and procedures generally employed by PL for such construction, and in accordance with the National Electric Safety Code, as it may be amended from time to time.

C. PL shall construct the Line in general accordance with the'lans and specifications as shall be established for the construction of the Line, provided however, PL shall be permitted to alter or amend at any time and from time to time any portion or all of such plans and specifications, provided that said alterations or amendments are made with the intended purpose of improving said Line and/or the facilities and auxiliaries related thereto.'L shall use its best efforts to

'I minimize the cost of the Line, provided that PL shall not reduce or impair the quality. of said Line.

D. Except as provided for in Article XXXIII of this Agreement PL shall have the sole and absolute authority and discretion to design and construct the Line.

E. AE shall pay to PL all Construction Costs of whatso-ever nature associated with the construction of the Line. AE shall pay to PL all costs incurred in acquisition of Right of Way subsequent to Closing which Right of Nay may be required for the Line. Such costs 'shall be billed to AE and paid by AE in accordance with billing and payment procedures for Con-struction Costs set forth in Subpart G of this Article IV.

F. PL shall keep separate accounting and,other records related to the construction of the Line using generally the same accounting procedures and practices followed in constructing similar facilities which are to be owned and used by PL, which accounting procedures and practices shall follow those prescribed by the applicable Uniform System of Accounts of the Federal Power Commission and shall be in accordance >vith generally accepted accounting principles consistently applied.

G. PL shall, on or before February 25, 1977 and on or before the twenty-fifth (25th) day of each month thereafter, notify AE 1

of the nature and amount of the Estimated Construction Costs anticipated to be recorded by PL on its accounting books and records during the next calendar month. AE shall pay to PL at Closing in immediately available funds by wire transfer to PL's account at The First Pennsylvania Bank, N.A., Philadelphia, Pennsylvania, or any other bank which PL may designate, the Estimated Construc-tion Costs for i>1arch 1977 plus interest on said estimated con-struction costs at the annual rate of 8.25: (using a 360-day year)

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for the period March 10 to March 18, 1977 AE shall make payment

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to PL in immediately available funds for all such Estimated Con-struction Costs for April 1977 and for each month subsequent thereto, and for settlement of Actual Construction Costs as de-tailed below on the tenth (10th) day of the month, immediately succeeding the month during which PL rendered an estimated bill to AE, by wire transfer to PL's account at The First Pennsylvania Bank, N.A., Philadelphia, Pennsylvania, or any other bank which PL may designate. If any payment is due on any day not a Business Day it may be made on the succeeding Business Day with-out premium or penalty.

In the aforesaid notification, beginning with April 1977, PL shall notify AE of Actual Construction Costs recorded in the prior month. Any difference between such Actual Construction Costs and the Estimated Construction Costs for such prior month shall be shown on the notification. Any such difference shall be settled between the Parties by an adjustment to the bill sent to AE by PL on or before the twenty-fifth (25th) day of each month and payable on the tenth (10th) day of the next month. Estimated Con-struction Costs and Actual Construction Costs shall be accompanied by an accounting of costs in sufficient detail to enable AE to account for such payment on its books. No payment made pursuant to the foregoing provisions of this Article IV, Subpart G, shall con-stitute a waiver of any right of AE to contest any cost or any adjustment by PL. Contest shall mean the right of AE to question either the equitable allocation of any cost or payment which was allocated by PL between the Line and some other PL facility as

l contemplated in this Agreement or the mathematical accuracy of any cost or payment required to be made by AE as contemplated in this Agreement, but specifically shall not mean the .right of AE to question or challenge the appropriateness, desirability or wisdom of any cost, payment or expenditure made or incurred for the benefit of the Line.

Subsequent to the payment of a bill for Construction Costs by AE to PL, AE and PL shall, at any time, and in a timely manner, make adjustments as may be necessary to that bill. All adjustments to Construction Costs shall be accounted for as part of Construction Costs in the month in which it is determined that an adjustment is necessary.

There shall be added to each adjustment to Construction

. Costs required as a result of an error undiscovered for a period in excess of three (3) months, interest at the annual rate of eight percent (So) simple interest based on a 360-day year, computed from the date the bill actually was paid until the date the cost is actually accounted for between the Par'ties hereto.

H. If AE shall fail to pay to PL the Estimated Construction Costs and payments which may be required in settlement of Actual Construction Costs by the tenth (10th) day of each month pursuant to this Article IV, there shall be added. to such overdue amounts interest from the date such payment was due until paid in full at the rate of interest in effect from time to time equal to the minimum commercial lending rate charged to responsible and substan-tial borrowers (prime rate) by The First Pennsylvania Bank, N.A.,

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Philadelphia, Pennsylvania, its successors and assigns plus two percent (2:) computed on the basis of a 360-day year.

I. AE shall make each payment for Estimated Construction Costs and each payment required to be made in settlement of Actual Construction Costs when due, regardless of any possible dispute in the amount which PL claims to be due. After payment, AE may contest any bill sent by PL to AE for payment.

J. Except as set forth in Subpart K of this Article IV, costs of a capital nature (which costs would be capitalized pur-suant to PL's normal accounting practices, which practices follow those prescribed by the applicable Uniform System of Accounts of the Federal Power Commission) may be incurred sub-sequent to the time when the Line is in service. In this event, said costs of a capital nature shall be determined, billed and paid pursuant to the terms and conditions of this Agreement.

K. In the event PL alters, changes or modifies the Line (whether during initial construction of the Line or subsequent to the date when the Line is in service) to meet.PL standards then in effect with respect to such facilities AE shall be responsible for all costs of a capital nature associated therewith, provided however, that AE shall not be responsible for the costs associated with increasing the power -carrying capabilities of the Line or for other changes which solely benefit PL.

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I M. Construction Costs shall be paid by AE to PL pursuant to'the terms and conditions as set forth in this Article EV of this Agreement without regard as to how or the manner in which either AE or PL accounts and records said Construction Costs on their respective accounting books and records.

I'End of Article IV)

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Article V: Closin and Second Closin A. ~Closin Closing of the transaction contemplated herein shall take place at 10:30 A.M. on March'18, 1977, at the .

office of the National Rural Utilities Cooperative Finance Corporation (CFC), Washington, D.C. or at such other time and place as may be mutually 'agreed upon by the Parties.

2. At Closing, AE shall pay to PL the Deposit on Pur-chase Price according to the terms and procedures set forth in Article III, Subpart B of this Agreement.

3. At Closing, AE shall pay to PL the Estimated Con-struction Costs for March 1977 and interest from March 10 through March 18, 1977 on the Estimated Construction Costs for March, 1977 according to the terms and procedures set forth in Article IV, Subpart G of this Agreement.

4. At Closing, this Agreement shall be placed in a mutually agreeable location for safekeeping. The Deed, the form of which is attached hereto as Exhibit A and the Bill of Sale, the form of which is attached hereto as Exhibit B, shall be executed by PL and acknowledged by a notary public. Neither the Deed nor 1

the Bill of Sale shall be delivered to AE, but both the Deed and the Bill of Sale shall. be placed in the same location as this Agreement for safekeeping. It is specifically understood that no conveyance of real estate and no transfer of any personal or mixed property shall take place at Closing.

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B. During the period between Closing and Second Closing, AE shall continue to make Supplemental Deposits on Purchase Price equal to the Construction Costs billed according to the terms and procedures as set forth in Article IV of this Agree-ment.

C. Second Closing shall take place not later than twenty days (20) subsequent, to the satisfaction of the conditions precedent to Second Closing as set forth in Article XV of this Agreement.

1. The Purchase Price shall be equal to the Deposit on Purchase Price plus the sum of all bills for Supplemental Deposits on Purchase Price rendered by PL to AE and due for A

payment by AE prior to Second Closing pursuant co the terms of this Agreement from the date of Closing to the date of Second Closing. At Second Closing AE shall pay to PL the dif-ference between the Purchase Price and all monies actually paid by AE to PL pursuant to the terms of this Agreement from the date of Closing to the date of Second Closing.

2. At Second Closing, PL shall deliver to AE the Bill of Sale for the Line Project and Line Additions. At Second Closing, PL shall deliver to AE the Deed, which was placed in safekeeping pursuant to this Article V, Subpart A(5),

which Deed shall be amended to reflect Right of Nay acquired by PL subsequent to Closing.

(End of Article V) 4 1'

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Article VI: Transmission 0 eratin Costs A. AE shall pay Transmission .Operating .Costs to PL each month. Transmission Operating Costs shall consist of the sum of the following:

1. Monthly operation and maintenance costs applicable to the Line.

2. A monthly charge for an allocated portion of opera-tion and maintenance costs of substations used, in rendering transmission service pursuant to the terms of this Agreement to AE and an allocated portion of the costs of load dispatching.

For the purpose of this Article V1, Subpart, A(l), said costs shall be the direct and indirect costs related to the Line determined pursuant to accounting procedures and practices I

prescribed by the applicable Uniform System of Accounts of the Federal Power Commission and in accordance with generally accepted accounting principles consistently applied. PL shall keep records which will show the costs directly incurred in the operation and maintenance of the Line and clearing and maintenance of Right of Nay and further shall show the super-vision, overheads, general and administrative expenses and taxes,; other than taxes measured on or imposed on income, related to or allocated to the Line. An equitable allocation of all costs of owning'including depreciation) and operating auxiliary supporting facilities of PL which enure to the benefit of the Line shall be included in said costs.

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For the purpose of this Article VI, Subpart A(2), such monthly charge shall be paid by AE commencing on the date on which the first unit of Susquehanna is placed in commercial operation. The Parties agree that the monthly charge set forth in this Article VI, Subpart A(2)., applicable to the year 1975 would have been $ 7,000. For each calendar year subsequent thereto, such monthly charge shall be determined as the sum of: $ 5,250 to be escalated based on the compound increase of all average annual wage increases (including fringe benefits) granted by PL to its union employees since 1975, plus $ 1,750 multiplied by the ratio of the Handy-Nhitman Index of Total Transmission Plant, North Atlantic Division as of January 1 of each year to said index as of January 1, 1975. The Handy-Nhitman Index referred to hereinabove is published by Nhitman, Requardt and Associates, 1304 St. Paul Street, Baltimore, Mary-land 21202, and the Total Transmission Plant Index for the North Atlantic Division appears in the current publication of the Handy-Nhitman Index in Table 3 on Line 29, attached hereto as Exhibit F.

In the event that the appropriate Handy-Nhitman Index is unavailable when needed, said index shall be estimated by PL and Estimated Transmission Operating Costs and Actual Trans-mission Operating Costs for that month shall be rendered on the basis of said estimate. Nhen said index is available, PL and AE shall adjust, in a timely manner, all prior bills reflecting the said estimated index.

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B. In respect of the portion of Transmission Operating Costs set forth in this Article VI, Subpart A(2), for the year 1986 and then for every tenth year thereafter, the Parties shall consider whether the charge as adjusted pursuant to the escala-tion provision is fair and equitable to both Parties. If either Party decides that said charge is no 1'onger fair and equitable, the Parties shall mutually establish a new charge applicable to the year 1986 and shall also establish a method of escalation for the ten years subsequent thereto. If the Parties are. unable to mutually establish prior to March 31, 1986 (and on March 31 of each tenth year thereafter) a new 'charge. or a method of escalation as afo'resaid, PL .may file. a.'ite sched'ule for such 'charge with the Federal Power Commission or other bodies having jurisdiction over such matters, with AE retaining the right to protest such rate before said bodies.

C. PL shall, on or before the twenty-fifth day of each month, commencing with the month prior to the first month Trans-mission Operating Costs are expected to be incurred, notify AE of the amount of Estimated Transmission Operating Costs antici-pated to be applicable to the next calendar month.

AE shall make payment. to PL in immediately available funds for all such Estimated Transmission Operating Costs and- for settlement of Actual Transmission Operating Costs as detailed below by the tenth day of the month immediately succeeding the month during which PL rendered an estimated bill to AE, by wire 22>>

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transfer, to PL's account at, The First Pennsylvania Bank, N.A.,

Philadelphia, Pennsylvania or any other bank which PL may desig-nate.

On or be fore the twenty- fi fth day o f each month beginning with the second month in which there have been Trans-mission Operating Costs, PL shall notify AE of the Actual Transmission Operating Costs recorded in the prior month. Any difference between the Actual Transmission Operating Costs and the Estimated Transmission Operating Costs for such prior month shall be shown on the notification. Any such difference shall be settled between the Parties by an adjustment to the bill sent to AE by PL on the twenty-fifth day of each month and payable on the tenth day of the next month.

Estimated Transmission Operating Costs and Actual Transmission Operating Costs shall be accompanied by an account-ing of costs in sufficient detail to enable AE to account for such payment on its books. No payment made pursuant to the foregoing provisions of this Article VI, Subpart C, shall con-stitute a waiver of any right of AE to contest any cost or any adjustment made by PL. Contest shall mean the right of AE to question either the equitable allocation of any cost or payment which was allocated by PL between the Line and some other PL facility as contemplated in this Agreement or the .

mathematical accuracy of any cost or payment required to be made by AE as contemplated in this Agreement, but specifically shall not mean the right of AE to question or challenge the

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appropriateness, desirability or wisdom of any cost, payment or expenditure made or incurred for the benefit of the Line.

D. If AE shall fail to pay to PL the Estimated Trans-mission Operating Costs and payments which may be required in settlement of Actual Transmission Operating Costs by the tenth day of a month pursuant to this Article VI, there shall be added to such overdue amounts interest from the date such payment was due until paid.-in full at the rate of, interest in effect from time to time equal to the minimum commercial lending rate charged to responsible and substantial borrowers (prime rate) by The First* Pennsylvania Bank, N.A.; Philadelphia, Pennsylvania, its successors and assigns, plus two percent (25) (computed on the basis of a 360-day year). If any payment is due on any day not a Business Day i't may be made on the next Business Day without premium or penalty.

E. PL shall make available to AE all records and accounts relating to Transmission Operating Costs at the place where such records and accounts are normally maintained, and AE shall be permitted at its own expense to audit, study, examine and copy same during normal PL business hours. AE shall furnish to PL the re-sult of each such audit within ninety (90) days subsequent to the completion or discontinuation of each such audit.

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F. AE shall make each payment for Estimated Transmission Operating Costs, and each payment required to be made in settle-ment of actual Transmission Operating Costs, when due, regard-less of any possible dispute relating to the amount which PL claims 'to be due. After payment, AE may contest any bill sent by PL to AE for payment, except, however, in the event that AE in good, faith concludes that, PL has arithmetically miscalculated any bill sent to AE for payment, AE may contest said arithmetically miscalculated portion of such bill prior to paymegt of the amount or portion contested.

G. PL shall provide to AE, 'as soon as practicable after execution of this Agreement, all estimates of anticipated Transmission Operating Costs which PL has prepared. PL shall update said estimate at least once annually.

H. Subsequent to the payment of a bill for Transmission Operating Costs by AE to PL, AE and PL shall at any time, and in a timely manner, make adjustments as may be necessary to that bill. All adjustments to Transmission Operating Costs shall be accounted for in the month in which it is determined that an adjustment is necessary. There shall be added to each adjustment to Transmission Operating Costs, required as a result of an error undetected. for a period in excess of three months, interest at the annual rate of eight percent (8:) simple interest based on a 360-day year, computed from the date the cost actually was paid until the date the cost is actually accounted for between the Parties.

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,I. Transmission Operating Costs shall be paid by AE to PL pursuant to the terms and conditions as set forth in this Article VI of this Agreement without regard as to how AE or PL accounts and records said Transmission Operating Costs on their respective accounting books and records.

(End of Article VI)

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Article VII: Use and En o ment A. During the term of this Agreement, AE hereby grants to PL the right to use, alter, change, remove, modify, and in every manner deal with the Line and Right of Nay, as if it were PL's own Line and Right of Nay, subject only to Subpart B of this Article VII.

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B. In the .event that PL removes, alters, changes, or modifies the Line in such a manner as to materially reduce the value of AE's 'investment in the Line, then PL shall grant, trans-fer and convey to AE, other transmission facilities (Other Trans-mission Facilities) having a fair market value, substantially equal to the amount by which AE's investment in the Line was reduced as a result of PL's removal, alteration, change or modification as aforesaid. AE and PL shall mutually select said Other Transmis-sion Facilities, provided that the granting, transferring or con-veying of said Other Transmission Facilities by PL to AE does not or will not interfere with the general business of PL.

C. Nothing in this Article VII of this Agreement shall be interpreted in such a manner as to reduce the benefits and rights of PL and AE as set forth in this Agreement.

D. In the event that PL grants, trans fers or conveys Other Transmission Facilities to AE, those facilities plus any 27>>

remaining portion of the Line owned by AE shall collectively thereafter be defined as the Line for purposes of this Agreement, and all of the terms and conditions of this Agreement shall apply with respect to all of the aforesaid property.

(End of Article VII)

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Article VIII: Bulk Power Transmission Service A. PL shall provide to AE, without charge or cost, except, as specifically set. forth in this Agreement, a bulk power transmission service for (1) AE's power produced by Susquehanna from'Susquehanna to PL's points of interconnec-tion with other utilities and systems with which AE has arrangements for the delivery of such power for AE; (2) AE's share of power provided for Susquehanna's station use to Susquehanna from PL's points of interconnection with other utilities and systems with which AE has arrangements for the delivery of such power to such points of interconnection; and (3) that power furnished by PL to AE as- may be required to be furnished by PL to AE pursuant to contractual. obligations between PL and AE as may exist as of the date of the execution of this Agreement, from the source of such power on PL's system to PL's points of interconnection with other utilities and systems with which AE has arrangements for the delivery of such power for AE; provided, however, those power quantities.

set forth hereinabove shall be reduced by that percentage as is designated on Exhibit D, attached hereto and made a part, I

hereof.

B. PL shall provide to AE those bulk power transmis-sion services as set forth in this Article V, Subpart A,so long as AE owns not more than an eleven percent (11-;.) and not less I.

I I

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than a nine percent (9,) undivided ownership interest in Sus-quehanna. In the event that AE owns more than an eleven percent (ll'o) undivided ownership interest in Susquehanna, PL shall provide the bulk power transmission service as herein set forth only with respect to said eleven percent (ll:) undivided owner-r ship interest. Bulk power transmission service related to-any AE- interest in Susquehanna in excess of an eleven percent (11:)

interest shall be provided by PL as set forth in this Article VIII, only upon payment by AE to PL of PL's cost of service then in effect'o provide such bulk power transmission service, including but not limited to a reasonable return on investment, depreciation, taxes, and operating expenses pursuant to a rate schedule (as may be amended from time to time) which shall be filed with the FPC or with any other body having jurisdiction over such matters. Such rate schedule shall specifically be subject to Article XXXI of this Agreement. In the event AE owns less than a nine percent (9:) undivided ownership interest in Susquehanna, PL shall provide the bulk power transmission service for AE as hereinabove set forth, except that AE shall receive an equitable annual financial adjustment (which shall recognize a reasonable return on investment, depreciation, taxes, and operating expenses with respect to the Line) to reflect the difference between AE's actual undivided ownership interest in Susquehanna and a nine percent (95) undivided ownership interest in Susquehanna.

(End of Article VIII)

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Article IX: 0 eration, Mana ement and Maintenance of the Line an . Rz. t o 1'/a A. PL shall have the sole and absolute authority and discretion to control, manage, operate and maintain the Line and Right of Nay.

B. PL shall operate and maintain the Line and Right of Nay in accordance with the normal practices and procedures observed by PL with respect to the operation and maintenance of similar transmission lines and right of way.

(End of Article IX)

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Article X: Access to Books and Records PL and AE shall have full and complete access at thei.r own costs during normal PL or AE working hours, as the case may be, to any and all contracts, agreements, books, accounts and records maintained in respect of the Line and Right of Nay at the location where such materials are usually maintained, including but not limited to (1) accounting books and records; (2) environmental statements, studies and reports; (3) health and safety statements, studies, and reports; (4) engineering statements, studies and reports; and (5) all licen-ses, permits and applications, and drafts of same, and shall have full and complete use, at the location where such materials are usually maintained, of said books, records, statements, studies, reports, licenses, permits, and applications, for the purpose of auditing, testing, studying, copying and exam-ining same. PL shall supply t'o AE, at AE's request, and without additional cost to AE, one copy of each document (other than as limited by the terms hereof) relating to the Line as is necessary for the reasonable operation of AE.

(End of Article X)

<<32 ~

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Article XI: Re resentations and Warranties A. AE hereby represents and warrants to PL as follows:

l. AE is a corporation duly organized, validly existing and in good standing under the laws of the Commonwealth of Penn-sylvania and is duly qualified to conduct business in the Common-wealth of Pennsylvania.

2. AE has full corporate power and authority to execute and deliver, and to perform its obligations under this Agreement.

3. The execution, delivery and performance by AE of this Agreement have been duly authorized by all necessary corporate action on the part of AE.

B. PL hereby represents and warrants to AE as follows:

1. PL is a corporation duly organized, validly existing and in good standing under the laws of the Commonwealth of Penn-sylvania and is duly qualified to conduct business in the Common-wealth of Pennsylvania.

2. PL has full corporate power and authority to execute and deliver, and to perform its obligations under this Agreement.

. 3. The execution, delivery and performance by PL of this Agreement have been duly authorized by all necessary corporate action on the part of PL.

(End of Article XI)

<<33 ~

PL and AE shall cooperate with e'ach other in any and all activities in connection with the Line and. Right of Nay in-eluding, without limitation, the execution and filing of applica-tions for authorizations, permits, permissions, advisory letters, and licenses for any and all purposes, and the execution of all documents as may be necessary or advisable to confirm authority of PL to act for AE in connection with AE's interest in the Line and Right of Nay. PL shall cooperate with AE in connection with AE's obtaining the financial commitments necessary for AE to observe and carry out the provisions of this Agreement.

Nothing in this Article or in any other Article of this Agree-ment shall'e interpreted as obligating PL or AE to act as a guarantor, surety or to provide other security for any finan-cial commitment which the other Party may undertake or obtain.

(End of Article XII)

Article XIII: Insurance A. AE shall purchase from an insurer acceptable to PL an All-Risk Builder's Risk Policy for the total value of the con-struction costs of the Line. This policy shall be in force from a period of ten days prior to the start of the construction of the line until date of commercial use or in-service date of the Line, whichever first .occurs. PL shall be an additional insured on this policy. AE shall furnish to PL proof of purchase of an All-Risk Builders Risk Policy ten days. prior to start of construction and furnish to PL thereafter, when available, a true copy of the Policy.

B. AE shall furnish to PL ten days prior to the start of the construction of the Line proof of their maintaining a General Liability Policy with limits of liability of at least Bodily Injury coverage and at .least $ Property Damage coverage, which coverage shall remain during the useful life of the Line.

(End o f Article XIII) 35

Article XIV: Transfer and Sales Taxes AE shall pay all taxes, and recording charges other than taxes imposed on or measured by income incurred in connection with the conveyance'o AE of the Right of Nay and the Line including any such taxes and recording charges (including but not limited to real estate transfer taxes and sales or use taxes, if any) which may arise with respect, to recording of documents or the mortgaging or imposing of any lien on the property transferred. PL and AE shall separately bear the costs of taxes which are either imposed on PL or AE as separate entities or are imposed on the separate undivided ownership interests of PL and AE in the Right of 1Vay.

(End of Article XIV)

Article XV: Conditions Precedent to Closin and Second Closin A. ~Clos in The occurence of each and every condition as set forth below (or the waiver in writing of such condition by PL) as here-in specifically set forth is a prerequisite to Closing.

1. PL and AE shall have performed or accomplished all their agreements contain'ed herein to be performed or accomplished prior to or at Closing.

2. This Agreement and Exhibits A and B attached hereto shall have been duly executed and acknowledged in such a manner as shall be required by law and to protect the rights of the Parties thereto and their respective successors and assigns."

3. PL shall have received from 'Ãi3.liam C. Wise, Esquire, counsel to AE, or other counsel acceptable to PL, a favorable opinion addressed to PL in a form acceptable to PL, dated the Closing Date, as to:

(a) The due organization, valid existence and good standing of AE under the laws of the Commonwealth of Pennsylvania, and its due qualification to conduct business in Pennsylvania.

(b) The. corporate power and authority of AE to execute, deliver, perform and observe its obligations under this Agreement.

4. AE shall have received from Edward M. Nagel, Esquire, General Counsel to PL, a favorable opinion addressed to AE, in a form acceptable to AE, dated the Closing Date, as to:

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(a) The due organization, valid existence and good standing of PL under the laws of the Commonwealth of Pennsylvania and its due qualification to conduct busi-ness in Pennsylvania.

(b) The corporate power and authority of PL to execute, deliver, perform and observe its obligations under this Agreement.

S.'E shall have received from Edward i4. Nagel, Esquire, General Counsel to PL, an opinion addressed to AE in a form acceptable to AE dated the Closing Date as to the it title to Right of Way as exists at Closing.

B. 'Se'con'd 'Cl'o's'i'n The occurrence 'of each and every condition as set forth below (or the waiver in writing of such condition by PL) as herein specifically set forth is a prerequisite to Second Closing.

1. The Administrator of the Rural Electrification Administration shall have approved in writing this Agreement.

2. The Pennsylvania Public Utility Commission (PPUC) shall have approved PL's application with respect to the transactions contemplated in this Agreement. Such approval shall have been duly issued in a form acceptable to PL and AE and such approval shall have become effective in accordance with r

such terms and conditions as may be therein contained or the PPUC shall have denied jurisdiction over the transaction contemplated herein or therein.

3. If required, the Nuclear Regulatory Commission shall have issued a construction permit, for Line naming PL and AE as co-owners under said permit and said permit shall have been duly issued in a form acceptable to PL and AE and said permit shall have become effective in accordance with such terms and conditions as may be therein contained.

4. PL and AE shall have performed or accomplished all their agreements contained he'rein to be performed or accomplished prior to or at Second Closing.

5. This Agreement and Exhibits A and 3 attached hereto shall have been duly executed and acknowledged'in such a manner as shall be required by law and to protect the rights of the Parties thereto and their respective successors and assigns. Any I

real estate transfer taxes, and recording charges in connection with the execution, recording and filing of the Deed shall have been duly paid in full by AE.

6. PL shall have received from Morgan Guaranty Trust Company of New York a written release of the interest in Line Project, Line Additions and Right of Nay to be conveyed to AE hereunder, from the lien of the Mortgage and Deed of Trust, dated October 1, 1945, to Guaranty Trust Company of New York (now Morgan Guaranty Trust Company of New York), as supplemented, and PL shall have delivered a copy of said written-release to AE.

7. PL shall have received from William C. Wise, Esquire, counsel to AE, or other counsel acceptable to PL, a favorable opinion addressed to PL in a form acceptable to PL, dated the Second Closing Date, as to:

(a) The due organization, valid existence and good standing of AE under the laws of the Commonwealth of Pennsyl-vania, and its due qualification to conduct business in Pennsylvania.

(b) The corporate power and authority of AE to execute, deliver, perform and observe its obligations under this Agreement.

8. AE shall have received from Edward M. Nagel, Esquire, General Counsel to PL, a favorable opinion addressed to AE, in a form acceptable to AE, dated the Second Closing Date, as to:

(a) The due organization, valid existence and good standing of PL under the laws of the Commonwealth of Pennsylvania and its due qualification to conduct business in Pennsylvania.

(b) The corporate power and authority of PL to execute, deliver, perform and observe its obligations under this Agreement.

9. AE shall have received from Edward M. Nagel, Esquire, General Counsel to PL, an opinion addressed to AE, in a form acceptable to AE, dated the Closing Date as to the title to the Right of Nay as it exists at Second Closing.

10. AE shall have delivered to PL (i) a letter addressed.to Chemical Bank signed by the President or a Vice President of AE and the Governor of National Rural Utilities Cooperative Finance Corporation authorizing Chemical Bank .

to cancel the Letter of Credit, dated March 18, 1977, established by Chemical Bank in favor of the National Rural Utilities Cooperative Finance Corporation and (ii) the original of said Letter of'redit.

(End of Article XV)

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Article XVI1: Survival All agreements, covenants, promises, representations and warranties, surrenders and releases as contained in this Agreement shall survive Closing and Second Closing and shall survive the conveyance of the Right of Nay as set forth in Article II hereof and shall not be deemed to merge with the Deed and conveyance of the Right of Nay and shall survive the delivery of the Bill of Sale, the form of which is attached hereto as Exhibit,B, as it may be amended.

(End of Article XVII)

Article XVIII: Ame'n'dm'en'ts Any amendment to this Agreement shall not bec'om'e effective until approved'y theAdministrator of the'ural Electrification Administration. The'ermination Agree'men't by'nd between PL "and AE bearing ev'en date herewi:th shall not'e deemed an amendment to thi;s Agreement requiring as a co'n'dition to its becoming effective the approval of the Administrator of the Rural Electrification Administration.

(End of Article XVIII) 44

A'1 XIX:~C This Agreement may be e'xecuted in two or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.

(End of Article XIX)

The validity, interpretation and performance of this Agreement and of each and every provision hereunder shall, except as otherwise provided by law, be governed by the laws of the Commonwealth of Pennsylvania.

(End of Article XX)

Article XXI: Benefit of A reement Except as contemplated in Articles'XV and XXVIII of this Agreement, the provisions of this Agreement are for the benefit of the Parties and not for'ny othe'r person'r'ntity.

(End oS Article XXI)

The provisions of this Agreement are severable, and if any provision shall be determined to be illegal or unenforceable, such determination shall in no manner affect any other provision hereof, and the remainder of this Agree-ment shall remain in full force and effect without regard to the fact that one or several provisions of this Agreement may be determined from time to time to be illegal or unenforce-able; provided, however, that the intention and, essence of this Agreement may still be accomplished and satisfied.

.(2nd of Article XXII)

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I Article xxlXI: Failure to Enforce Provisions of this A reement The failure of any Party to insist in any one or more instances upon strict performance of any of the pro-visions of this Agreement or to take advantage of its rights hereunder, shall not be construed as a waiver of any such provision, or the relinquishment of any such rights, but the same shall continue to remain in full force and effect.

(End of Article XXIII)

Article XXIV: No Delay No disagreement or dispute of any nature between PL and AE concerning any matter, including but not limited to the amount of any payment shown on any bill or notice submitted by PL to AE pursuant to this Agreement, to be due from'AE, shall permit AE to delay or withhold any payment or the performance of any other obligation pursuant to this Agreement except as contemplated in Article IV, Subpart I, of this Agreement.

(End of Article'.XXIV)

I Article XXV: Alienation 5 Assi nment A. AE may sell, convey, transfer, assign or alienate (hereinafter collectively referred to as Transfer) all or any portion of its interest in the Line and Right of Nay to any third party upon the following terms and conditions.

In the event AE desires to Transfer any portion or all of its interest in the Line and Right of Nay to any pro-posed Transferee .(other than as security for an indebtedness) and AE shall have received, in writing from said proposed Trans-feree a bona fide offer to accept all or any portion of AE's interest. in the Line and Right of Nay, AE shall within thirty .

days from the day it receives said written offer, offer to PL that interest in the Line and Right of Nay which said proposed Transferee has agreed to accept upon the identical terms and conditions as that offer received from such proposed Trans-feree. PL shall have thirty (30) days from the day it receives said offer from AE to accept or reject said offer. Silence shall be deemed a rejection. If PL rejects said offer, and thereafter AE elects to Transfer its interest in the Line and Right of Nay to said proposed Transferee, AE must do so upon the identical terms and conditions offered to. PL within three hundred sixty (360) days from the day PL rejected said offer made by AE or within three hundred ninety (390) days from the date PL received said offer, whichever shall first occur. If AE does not fully and properly execute an agreement of sale

or other transfer agreement and carry out same with said proposed Transferee within three hundred sixty (360) days

.5fter PL rejected said offer, or within three hundred ninety (390) days from the date PL received said offer, whichever shall first occur, AE shall not thereafter Transfer any portion or all of its interest in the Line and Right of Nay to any Transferee without first offering said interest to PL as provided herein.

3. All notices, offers, and rejections required go be given pursuant to this Article XXV, Subpart A, shall be sent by Certified Nail, addressed pursuant to Articl'e XVI-of this Agreement.

C. In the event that upon effecting compliance with this Article XXV, AE Transfers (other than as security for an indebtedness) any portion or all of its interest in the Line and Right of Nay AE shall, as a part of such transfer, cause such Transferee to become a party to this Agreement and to assume the obligations of AE hereunder proportionate to the interest of AE Transferred herein. Each and every term, con-

,dition and provision of this Agreement shall be binding on each and every one of AE's Transferees.

D. In the event that AE has Transferred (other than as security for an indebtedness) any portion or all of its interest in the Line and Right of Nay each Transferee of AE, and each subsequent Transferee of AE's Transferee (Transferee Entity) which desires to Transfer any portion or all of its

interest in the Line and Right of Nay shall be bound by and comply with the terms, conditions and provisions of this Article XXV, as if each Transferee Entity were AE and the offer required by this Article XXV, Subpart A,shall be made by each Transferee Entity to PL.

E. PL's rights to purchase all or any portion of AE's or the Transferee's Entities interest in the Line and Right of Nay pursuant to this Article XXV, shall be limited in time to twenty-one years after the death of the last sur-vivor of all the now living children and grandchildren of Rose Kennedy, mother of .the late President, John F. Kennedy, a list of such children and grandchildren being attached hereto as Exhibit C and made a part hereof.

F. In the event PL purchases from AE any or all of AE's interest in the Leone and Right of Nay, the bulk power transmission service PL is providing AE as set forth in Article VIII of this Agreement shall be proportionately reduced.

G. If in the event PL purchases from AE any portion or all of AE's undivided ownership interest in Susquehanna, PL must purchase a corresponding portion in the Line and Right of Nay from AE, if AE offers such interest in the Line and Right of Nay to PL, under and subject to the terms and con-ditions as fully set forth in this Article XXV of this Agree-ment.

(End of Article XXV)

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I Article XXVI: PL's'0 't'i'o'n t'o'Pur'ch'as'e 'thL'i'ne A. PL may at its option, exercisable on the earlier of the two dates below listed, purchase from AE all or any portion of AE's right, title and, interest of, in and to the Line and Right of Nay at, a cost, equal to the fair market value at the time PL exercises said option.

r B. PL's option shall be exercisable on the earlier of the following two dates:

1. Twelve (12) months subsequent to the date on which PL declares that Susquehanna shall no longer be used for the purpose of producing electric energy.

2. The day of the twenty-first anniversary of the death of the last survivor of all the now living children and grandchildren of Rose Kennedy, mother of the late President John F. Kennedy, a list of such children and grandchildren being attached hereto as Exhibit C and made a part hereof.

C. In the event PL desires to exercise its option pursuant to this Article XXVI, PL shall give to AE one hundred eighty (180) days'dvance notice of PL's intention to exercise I

its option.

D. In the event PL exercises its option pursuant to this Article XXVI, AE and PL shall mutually agree upon an Option Closing Date, which date shall be not longer than ninety (90) days subsequent to the day on which PL exercised its option.

<<54<<

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E. On the Option Closing Date:

l. AE shall assign, convey, transfer, alienate and sell to PL free and clear of every lien, mortgage, restriction and encumbrance of any nature.wh'atsoever, those items listed in this Article XXVI, Subpart A,of this Agreement.

2. AE shall perform all acts of whatsoever nature as may be required by PL to transfer that title to PL as required by Subpart E(l) of this Article XXVI, to those items listed in this Article XXVI, Subpart A, of this Agreement on th'e Option Closing Date.

3. PL shall pay to AE the purchase price as detailed in this Article XXVI, Subpart A, in immediately available funds upon fulfillment by AE to PL's. satisfaction of the conditions specifically set forth in this Article XXVI; F. In the event that PL shall not exercise its option on the earlier of the two dates listed in Subpart, B of this Article XXVI, then PL's rights under Article VII of this Agreement shall expire one day subsequent to the earlier of the aforesaid dates.

(End of Article XXVI)

Article XXVII: Default A. In the event that AE does not pay all costs required to be paid by AE to PL pursuant to Article IV and Article VI of this Agreement, (Default) and such Default con-tinues for a period in excess of ninety (90) days after PL notifies AE of its Default, then PL may, at its option, finish the construction'f the Line, by and for the account "of PL.

In the event PL exercises the aforesaid option, AE shall grant, convey, assign, and transfer unto PL (at no further cost to PL) an undivided ownership interest in the Line so that PL's and AE's undivided ownership interests in the Line shall then correspond to the sums of the Construction Costs expended by each 'Party in the Line. AE shall, without delay, perform all acts of any nature whatsoev'er as may be required by PL, at AE's own expense, to transfer title to PL to that undivided ownership interest in the Line to be acquired by PL as aforesaid.

'pon Default, PL sha13, in addition to the aforesaid option, be entitled to each and every remedy now or hereinafter provided by law or equity.

B. Upon Default AE shall be entitled to no bulk power transmission service as provided for in Article VIII of this Agreement until AE pays to PL all sums which should have been paid by AE to PL had Default not occurred plus the minimum commercial lending rate charged to responsible and substantial borrowers by The First Pennsylvania Bank, N.A., Philadelphia, Pennsylvania (prime rate) plus two percent (2:) using a 360-day

year, on all said overdue sums and computed from the day on which AE should have paid to PL the sums required to be paid by AE to PL pursuant to this Agreement until the day AE pays said sums. PL shall be required to accept, prior to the date on which PL exercises its option, such overdue sums from"AE when. tendered, provided that such sums are tendered together with the required interest as provided in this Article XXVII, Subpart B.

C. In the event of Default, AE shall be entitled to receive from PL bulk power transmission service for its share H

of energy produced by Susquehanna at the then current cost of service to provide such transmission service, including but not limited to, a reasonable return on investment, depreciation, taxes, and operating expenses (provided, however, that said cost of service shall recognize 85'o of that investment which AE has made in the Line pursuant to this Agreement) pursuant to a rate schedule (as may be amended from time to time) which may be filed with the 'Federal Power Commission or with any other body having jurisdiction over such matters. Such rate schedule shall be 'specifically subject to Article XXXI of this Agreement, (End of Article XXVII)

.I Article XXVIII: Succ'ess'o'rs','A's's'is'r'ans'fe'r'ees and Grantees This Agreement. shall enure to the benefit of and be binding upon PL and AE and their respective successors, assigns, transferees and grantees.

(End of Article XXVIII)

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l Article XXIX: Risk Subsequent to the in-service date of the Line, PL shall be responsible to all third p'arties for causes of N

action for personal injuries or property damage to said third parties resulting from the operation of the Line, provided that AE has not in any manner whatsoever directly or indirectly contributed to the occurrence of such cause of action.

gnd of Article XXIX)

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Article XXX: Recordi'ng At Second Closing this Agreement and all exhibits attached hereto shall be recorded in the office of the Recorder of Deeds of the following Counties in Pennsylvania: Columbia, Luzerne, Montour, .Northumberland, and Schuylkill. All expenses, fees, charges and taxes associated therewith shall be paid by AE.

I'End of Article XXX)

Article XXXI: ~Filin If and to the extent that this Agreement or any part hereof shall be required to be filed, or shall be filed with any regulatory agency as a rate or rate schedule, nothing in this Agreement shall be construed as affecting in any way the right of PL to unilaterally make application to such agency for a change in rates, charges, classy.fications or service, or any sale, regulations or contract relating thereto under applicable laws. To the extent that PL makes any such filing, AE shall have the right to intervene in any proceeding involving such a filing by PL and shall have the right to object to any proposed. change.

gnd of Article XXXI)

Article XXXII: Term o'f t'h'i:sAee'me'nt

1. This Agreement shall become effective and binding on the Parties hereto on March 18, 1977.

2. This Agreement shall expire, terminate and become null and void on the earlier of the two dates set forth below:

a. Thirty-six months subsequent to the date on which PL declares that Susquehanna shall no longer be used for the purpose of producing electric energy.

b. The day of the twenty-first anniversary of the death of the last survivor of all the now living children and grandchildren of Rose Kennedy, mother of the late President John F. Kennedy, -a list of such children and grand'children being attached hereto as Exhibit C-and made a part hereof.

(End of Article XXXII)

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Article XXXIII: En ineeri:n Ch'n's b AE AE may require PL to modify the design and specifi-cations of the Line provided that AE shall be fully responsible

'or all costs of whatsoever nature associated with said modifi-cations, and AE shall pay for said modifications pursuant to the terms set forth in Article II hereof; provided, however, that PL shall not have to comply with the aforesaid require-ments of AE if said requirements will or may in the judgment of PL a'lter the Line to the detriment of PL.

(End of Article XXXIII) t Article XXXIV: Pro'r'e's's'Re'o'rts'-'Cos't E'st'im'ates A. Beginning at Closing and at six-month intervals thereafter, PL shall furnish to AE written estimates (and explanations thereof if in PL's judgment such explanations are necessary to interpret the estimates) of the anticipated Costs of Construction .of'he Line..

B. Beginning at Closing and at monthly intervals thereafter, until the Line is placed .in service, PL shall furnish to AE progress reports, detailing the extent of construction of the Line and problems, if any, relating to the construction of the Line.

(End of Article XXXIV)

A XXXV: ~C' '

If in the event that either unit of Susquehanna

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commences commercial operation prior to the in-service date of the Line, PL shall provide to AE the bulk power transmission service as set forth in Article VIII hereof, except that AE shall pay to PL the cost of service then in effect to provide such bulk power transmission service including but not limited.

to a reasonable return on investment, depreciation, taxes, and operating expenses pursuant to a rate schedule (as may be amended from time to time) which shall be filed with the Federal Power Commission or with any other body having juris-diction over such matters', provided, however, that said cost of service shall recognize that investment which AE has made

,in the Line pursuant to Article II hereof. Such rate schedule shall specifically be subject to Article XXXI of this Agreement.

This Article XXXV shall not apply in the event that there has been a Default (as defined in Article XXVII hereof) until said Default is cured'y AE.

(End of Article XXXV)

Article XXXVI: Article Headin s Not'o Affect Meanin The .descriptive headings of the various Articles of this Agreement have been inserted for convenience or reference only and shall in no manner mod'ify or'estrict any of the terms or provisions hereof.

(End of Article XXXVI)

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Article XXXVII: Best Efforts During the term of this Agreement AE and. PL shall each use all best efforts to obtain and to keep in effect any and all governmental, regulatory, or other authorizations, permits, approvals, licenses, permissions and applications as may be necessary for each Party to perform its obligations under this Agreement.

(End of Article XXXVII)

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A XXXVIII: ~BA

PL shall use or cause to be used in connection with funds made available to PL by AE pursuant to the terms of this Agreement only such unmanufactured articles, materials, and supplies as have been mined or produced in the United States and only such manufactured articles, materials and supplies as have been manufactured in the United States substantially all from articles, materials or supplies mined, produced or manufactured, as the case may be, in the United States, except to theextent that'the Administrator of the Rural Electrification Administration shall determine that such use shall be impracticable or that the cost thereof shall be unreasonable.

(End of Article XXXVIII)

Article XXXIX: Fu'rt'h'e'r'As'sur'an'ces I

From time to time subsequent to Closing, PL and AE shall execute such instruments of conveyance and other documents, upon the request of the other, as may be necessary and appropriate to carry out the intent of this Agreement.

(End of Article XXXIX)

Article XL: Statutes PL acknowledges that it is familiar with the follow-ing:

(1) The Rural Electrification Act of 1936, as amended; and (2) 18 USCA 287, 18 USCA 874,'18 USCA 1001 and PL agrees to comply with the statutes hereinabove set forth insofar as same are applicable to PL. PL agrees tnat the obligations of t'e Parties hereunder are subject to the applic-able regulations and orders of governmental agencies having jurisdiction over the Line and Right of Nay.

(End of Article XL)

Article XLI: Historical Si.'tes PL shall not, without the prior approval of the Administrator of the Rural Electrification Administration, use any portion of the funds made available to PL by AE pursuant to the terms of this Agreement to construct any facilities to be used in connection with the Line on or at any site, building, structure or object which site, build-ing, structure or object is included in the National Register of Historic Places, maintained by the Secretary of the Interior pursuant to the Historic Sites Act of 193S and the I

National Historic Preservation Act.

(End of Article XLI)

Article XLII: Nai:ver'E shall not exercise 'its right under Pennsylvania Statute 1937, June 21, P.L. 1969 Section 4 [15 Purdons St'atutes Section 12404(12)] vith respect to the property of PL 'and PL's successors and assigns related to the Line and Right of )fay.

(End of Article XLII) 72

Article XLIII: ~Sei'et A. In the acquisition, construction and completion of the Line pursuant to this Agreement, PL shall at all times take all reasonable precautions for the safety of employees on the work and of the public, and shall comply with all applicable provisions of Federal, State, and Municipal safety laws and building and construction codes, including, without limitation, all regulatio'ns of the Federal Occupational Safety and Health Administration.

B. AE may not cancel or terminate this Agreement on the grounds that PL has breached the covenants contained in Subpart A of this Article XLIII until after PL has bee'n'iven (i) notice of such breach, and (ii) a reasonable 'opportunity to correct the circumstances causing the breach; provided, that this provision shall be applied in a manner not inconsistent with all applicable federal, state, and local laws and regu-lations, and provided further that AE shall not be prevented from exercising all other rights or remedies available to it in law or in equity .for breach of Subpart A of this Article XLIII.

(End of Article. XLIII)

Article XLIV: Flood Hazard Areas Anything contained in this Agreement to the con-trary notwithstanding, AE shall be under no obligation to advance any funds to PL to finance the construction or acquisition of any building in any area identified by 'the Secretary of Housing and Urban Development, pursuant to the

'I Flood Disaster Protection Act of 1973 (the "Flood Insurance Act") or any rules, regulations, or orders issued to imple-ment the Flood Insurance Act Q'Rules") as an area having special flood hazards, or to finance any facilities or materials to be located in any such building, or in any building owned or occupied by PL and located in such a flood hazard area, unless the Administrator of the Rural Electrifi-cation Administration has determined, that (1) the area in 1

which such construction or acquisition is located is then participating in the national flood insurance program, as required by the Flood Insurance Act and any rules and regu-lations issued thereunder; and (2) PL and AE have obtained insurance coverage with respect to such building and 'lood contents as may then be required pursuant to the Flood J

Insurance.Act and the rules thereunder.

(End of Article XLIV)

Article XLV: Con ressional Re resentatives PL and AE shall use their best efforts to assure that no member of or delegate to the Congress of the United States be permitted to obtain any special benefit from this Agreement. Receiving of electric, service on the same terms accorded other PL or AE customers shall not be deemed a special benefit.

(End of Article XLV)

Article XLVI: Nonse re ated Paci'1'i't'i'es PL certifies that PL does not maintain or provide for PL's employees any segregated facilities at any of PL's establishments, and that PL does not permit PL's employees to perform their services at any location, under PL's con-trol, where segregated facilities are maintained. PL further certifies that PL will not maintain or provide for PL's employees segregated facilities at any of its establishments and that PL will not permit its employees to perform their services at any location, under its control, where segre-

, gated facilities are maintained. PL agrees that a breach of this certification is a violation of Article XLVII of this Agreement. As used in this certification, the term "segre-gated facilities" means any waiting rooms, work areas, rest-rooms, washrooms, restaurants and other eating areas, time-clocks, locker rooms and other storage or dressing areas, parking lots, drinking fountains, recreation or en'ter'tain-ment areas, transportation, and housing facilities provided for PL's employees which are segregated solely on the basis of race, color, religion, or national origin either by explicit directive or in fact. PL agrees that (except as the certifi-cation set forth in this Article XLVI from proposed subcon-tractors) that PL will obtain certifications substantially the same as the certification set forth in this Article'LVI from subcontractors prior to the award of subcontracts entered into subsequent to Closing exceeding $ 10,000.00 in relation to the Line which subcontracts are not exempt from the provisions of this Article XLVI of this Agreement .and that PL will retain such certifications in its files.

(End of Article XLVI) 77>>

Article XLVII:

0 E ual 0 ortunit Clause During the performance of those parts of this Agree-ment relating to the construction by PL of the Line or any additions, betterments, replacements or improvements thereto, PL agrees as follows:

1. PL will not discriminate against any employee or applicant for employment because of race, color, religion, sex, or national origin. PL will take affirmative action to ensure that applicants are employed, and that employees are treated during employment without regard to their'ace, color, religion, sex or national origin. Such action shall include, but not be limited to, the following: 'mployment, upgrading, demotion or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. PL agrees to post in conspicuous places, available to employees and applicants for employment, notices to be provided setting forth the provisions of this Equal Opportunity Clause.

2. PL will, in all solicitations or advertise-ments for employees placed by or on behalf of PL, state that all qualified applicants will receive consideration for employ-ment without regard to race, color, religion, sex or national origin.

>>78-

3.. PL will send to each labor union or representa-tive of workers with which it has a collective bargaining agreement or other contract or understanding, a notice to be provided advising the said labor union or workers'epre-sentative of PL's commitments under this Article and PL shall post copies of the notice in conspicuous places available to employees and applicants for employment.

4. PL will comply with all provisions of Executive Order No, 11246 of September 24, 1965, and of the rules, regulations, and relevant orders of the Secretary of Labor.

5. PL will furnish all information and reports required by Executive Order 11246 of September 24, 1965, and by the rules, regulations, and orders of the Secretary of Labor, or pursuant thereto, and PL will permit access to PL's books, records, and accounts by the administering agency and by the Secretary of Labor for purposes of investigation to ascertain compliance with said rules, regulations, and orders.

6. In the event of PL's noncompliance with this Equal Opportunity Clause of this Agreement or with any of the said rules, regulations, or orders, this Agreement may be cancelled, terminated, or suspended in wh'ole or in part and PL may be declared ineligible for further 'G'overnment I

contracts or federally assisted construction contracts in accordance with procedures authorized in Executive Order No.

11246 of September 24, 1965, and such other sanctions may be imposed and remedies invoked as provided in said Executive Order No. 11246 of September 24, 1965 or by rule, regulation,

or order by the Secretary of Labor, or as otherwise provided by law. Provided, however, it is agreed that this Agreement will not be cancelled or terminated for reason of noncom-pliance by PL with Executive Order 11246 of September 24, 1965,. except in accord with the implementing regulations of the Department of Labor 41 CFR Chapter 60, including attempted resolution by informal means and opportunity for hearing as mandated by Sections 301, 302 and 209 of Executive Order NO. 11246 of September 24, 1965.

. 7. PL will include. the words "During the performance of this contract, the contractor agrees as follows": Followed by the provisions of Subpart ('.1) through ('7) of this Article XLVII in every subcontract or purchase order unless exempted by rules, regulations, or orders of the Secretary of Labor issued pursuant 'to Section 204 of Executive Order 11246 of September 24, 1965, so that such provisions will be binding upon each subcontractor or vendor. PL will take such action with respect to any subcontract or purchase order as the adminis'tering agency may .direct as a means of enforcing such provisions, including sanctions for noncompliance: Provided, however, that in the event PL becomes. involved in, or is threatened with, li.tigation by a subcontractor or vendor as a result of such direction by the administering agency, PL may request the United States to enter into such litigation to protect the interests of the United States.

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8. For purposes of this Agreement, the term "this Agreement" as used in Subpart (6) hereof shall mean those parts of this Agreement relating to the construction by PL of the Line, or any additions, betterments, replacements or improvements thereto.

(End of Article XLVlI)

Article XLVIII: Environment A. PL shall comply in respect of the Line and Right of Nay with (1) applicable water and air pollution con-trol standards and other environmental requirements imposed by federal or state statutes or regulations, and (2) the provisions of any Environmental Impact Statement issued by the United States. of America pursuant to the National Environmental Policy Act. PL shall take all steps necessary to assure that all actions undertaken pursuant to this Agreement by PL or entities specifically performing services for PL are in compliance with the provisions of this Subpart A of this Article XLVlII.

B. PL warrants, to. the best of its knowledge, that as of the Closing, the Line and Right of Nay are in full com-pliance with Subpart A of this Article XLVIII.

C. In the event, PL fails to comply with the require-ments of Subpart A of this Article XLVIII, AE shall not be entitled to terminate or cancel this Agreement if all three of the following conditions are satisfied; however, AE reserves for itself all other rights at law, equity or otherwise, to remedy a breach by PL of the terms and conditions of this Article XLVIII.

1. The items which are not in compliance with Subpart A of this Article XLVIII ar'e immaterial;

2. PL is making reasonable effort to correct the items which are not in compliance with Subpart A of this Article XLVIII; and 82

3. The United States is not prevented'y any statute, order or regulation from making or approving a loan or loan advance to. AE with respect,to Susquehanna be'causeof the specific items which are not in compliance with Subp'art A of this Article XLVIII; and provided further, that PL 'res'eives for itself all rights at law, equity or otherwise, to challenge any attempt by AE to terminate or cancel this Agreement pursuant to this Article XLVIII or in the event that AE attempts to use any remedy which AE reserved for itself pursuant to this Article XLVIII, Subpart C, to remedy a breach by PL 'of'he terms and conditions of this Article XLVII'I and, further, PL shall be permitted to enter and use any defense, countercl'aim or set-off in the event, tha't AE attempts to terminate or'ancel this Agreement.

(End of Article XLVIII) 83

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IN WITNESS WHEREOF, the 'Parties hereto hive 'duly executed this Transmission Agreement in Washington, D. C. on the 18th day of March,'977.

PENNSYLVANIA POWER 5 LIGHT COMPANY By:

Attest:

4884. Sg0peg~~gg ALLEGHENY ELECTRIC COOPERATIVE, INC.

By:

Attest:

~lg 84

COMMONWEALTH OF PENNSYLVANIA )

r /

COUNTY 0$

' of.>~'-~~<~',

On this, the y day 1977, before me, a Notary Public in and for the Commonwealth of Pennsylvania, the undersigned officer, personally appeared-y-'.'!y 6 .. ~e'~~ '/

who acknowledged himself to be theD>.r'"-<<~'.+~-'-"6>~"-~~go f Pennsylvania h.~Py 7 a

~ ~

d h h b ',g'".

authorized.to'o so, executed the foregoing instrument for the by h'f,,:

purposes therein contained by signing the WITNESS WHEREOF, p/-'N I hereunto set name my of the corporation hand and official seal.

..>)C<<<<s ~ c.

c.

NOTARY PUSLIC Allentown, Lehlgh County, Pennsylvanfa My Commission Expires June 6, 1977 otary Pu lic Pennsylvania My Commission Expires:

COi~KONNEALTH OF PENNSYLVANlA )

COUNTY OF On this, the IP day of ~o <'~, 1977, before me, a Notary Public in and for the Commonwealth of Pennsylvania, the undersigned officer, personally appeared 7 who acknowledged himself to be the Run.i~+ of

> "c4--

"c<4' ~c.~ <~M~ J -s a Pennsylvania corporatson, and that he as such bein authorized to. do so, executed the foregoing instrument for the purposes therein contained by signing the name of the corporation by himself as l~>~~

lN WITNESS WHEREOF, I hereunto set my hand and official seal.

Notary Public Pennsylvania My Commission Expires:

NOTARY pUnL/C My Commission Expiros January i5. 1979 Harrisburg, Po. Dauphin County

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EXHIBIT A DEED CONVEYING INTEREST IN RIGHT OF WAY EASEMENTS.

THIS INDENTURE dated as of the'3.6th day of March, 1977 by and between PENNSYLVANIA POWER 6 LIGHT COMPANY, a corporation organized and existing under the laws of the Commonwealth. of-Pennsylvania. (heieinafter referred to as "Grantor" ), and ALLEGHENY ELECTRIC COOPERATIVE, INC., an electric cooperative corporation, organized and existing under the laws of the Commonwealth of Pennsylvania (hereinafter referred to as "Grantee" ),

WITNESSETH, that. Grantor for and in consideration of the sum of Nine Hundred Thousand and 00/100 Dollars ($ 900,000.00) lawful money of the United States, the receipt whereof is hereby acknowledged, has granted, bargained, sold and .conveyed and by these presents does grant, bargain, sell and convey unto Grantee, its successors and assigns, as a tenant in common with Grantor (which. retains an undivided two-thirds interest in'he 'real prop-erty which is the subject of the interest conveyed. hereunder), an undivided one-third interest in all of Grantor s estate, right<

title and interest in and to the following real property: ALL THOSE CERTAIN easements and tracts of land situate in various townships in Northumberland, Montour, Columbi'a and Luzerne Coun-.

4I el ties, Pennsylvania, which are identified in Appendix A attached hereto and made part hereof.

EXCEPTING AND RESERVING to Grantor, its successors and assigns, all of the existing 230 KV electric transmission facili-ties presently located upon the aforesaid real property, including without limiting the generality of the foregoing all foundations, towers, poles, conductors, and'ther equipment of any kind wha so-.,

ever. It is agreed that the aforesaid real property shall be used

ii.

IN

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for purposes of (i) said 230 KV electric transmission line, (ii) a proposed 500 KV transmission line to be owned by Grantee and constructed on said real property, and (iii) such other facilities of Grantor as Grantor may at any time place or replace thereon, to the extent permitted by Grantor's present rights and easements referred to in Appendix A hereto, but without disturbing the rights of Grantee with respect to said, proposed 500 KV transmis-sion line; provided, however, that on the easements or tracts 4

identified as Nos. 172.1 through 188 in Appendix A hereto, Grantor shall have the right to install conductors for a 500 KV transmis-a sion line owned by Grantor, upon the structures supporting said 500 KV transmission line owned by Grantee. Said facilities to be hereafter constructed as mentioned in clauses (ii) and (iii) aforesaid shall be deemed personal property, and may be freely removed and replaced from time to time by the party for whose benefit the same is constructed.

UNDER AND SUBJECT to the following: (1) all rights of Grantor as set forth in the Transmission Agreement of even date herewith between Grantor and Grantee, intended to be recorded in the offices of the hecorders of Deeds of the aforesaid Counties, (2) the covenant, waiver, surrender and release hereinafter set forth> and ('3)'ll leases, easements, restrictions and other encumbrances now of record..

TO HAVE AND TO HOLD the property and rights granted and conveyed, as aforesaid, unto Grantee, its successors and assigns, as a tenant in common with Grantor, its successors and assigns, forever; EXCEPTING, RESERVING AND UNDER AND SUBJECT as herein provided.

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The following covenant, waiver, surrender and release is hereby entered, into by and between the parites hereto as tenants in common, namely, that the aforesaid real property and appurtenances, including the .undivided two-thirds interest, therein of Grantor as a tenant in, common, shall not, during the period hereinafter specified, be subject to any partition or sale for division, ei:ther voluntary or involuntary, by either judicial or non-judicial action, and all right to effect during said period such a partition or sale for division is hereby waived, surrendered and released by each of the parties hereto as tenants in common; and said covenant, waiver,'urrender and release (1) shall be binding upon and inure to the benefit .of each such tenant in common and its respective successors and assigns, and the mort-gagees, receivers, trustees or other representatives of the respective tenants in common and their respective successors and assigns, and shall run with the land;'(2) shall be effective during the period commencing with the date of the delivery. hereof and continuing after the completion and commencement of the opera-tion in the public service of Units 51 and 52 of the Susquehanna Steam Electric Station during the useful life of said Units Il and N2 of said station for the generation of electric energy, and for 12 months thereafter, except that if ay any one or more times during the said period all tenants in common then owning undivided interests in the aforesaid real property, by appropriate instru-ment executed and delivered by all such tenants in common (with the consents of or releases of lien by the holders of all mort-gages which are liens upon the interests of the respective tenants in common)., shall dispose of and convey and portion thereof or interest therein, said covenant,'aiver, surrender and release shall, upon such delivery, cease to be binding with respect to

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such portion or interest so disposed of and conveyed, but shall nevertheless remain effective during the aforesaid period with respect to the balance of said real propetty not so disposed of and conveyed; and (3) shall not, and is not intended to, prohibit or limit in any way the right of e'ach tenant in common at any time owning an undivided interest in said real property, including each party hereto, to sell, convey, mortgage and otherwise freely transfer and alienate- its own respective undivided interest therein, either in whole or in part, subject, however, to said covenant, waiver, surrender and release.

AND Grantor, for 4

itself and its successors, hereby covenants and agrees to and with Grantee, its successors and assigns, that Grantor shall warrant and forever defend all the property hereby granted and conveyed, and intended so to be, to I

Grantee, against any and all persons whomsoever lawfully claiming or to claim the same or any part thereof by, from or under it, them, or any of them, EXCEPTING, RESERVING AND UNDER AND SUBJECT as aforesaid.

Grantor hereby assigns to Grantee, its successors and assigns, an undivided interest, as aforesaid, in all righty title and interest or Grantor with,respect to all covenants and warranties by others heretofore given or made in respect of the I

property hereby granted and conveyed, and all rights of action for breach thereof; with full substitution and subrogation as to any such covenant, warranty or right which by its nature is not assignable.

THIS DOCUMENT MAY NOT SELL, CONVEY, TRANSFER, INCLUDE OR INSURE THE TITLE TO THE COAL AND RIGHT OR SUPPORT UNDERNEATH

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THE SURFACE LAND DESCRIBED OR REFERRED TO HEREXNi AND THE OWNER OR OWNERS OF SUCH COAL MAY HAVE THE COMPLETE LEGAL RIGHT TO REMOVE ALL OF SUCH COAL AND f IN THAT CONNECTION g DAMAGE MAY RESULT TO THE SURFACE OF THE LAND AND ANY HOUSE g BUILDING OR OTHER STRUCTURE ON OR IN SUCH LAND. THE INCLUSION OR THIS NOTICE DOES NOT ENLARGEi RESTRICT OR MODIFY ANY LEGAL RIGHTS OR ESTATES OTHERWISE CREATED'RANSFERRED g EXCEPTED OR RESERVED BY THIS INSTRUMENT ~

IN WITNESS WHEREOF, Grantor has caused its corporate seal to be hereto affixed and these presents to be signed, in

"'ts name and behalf by its duly authorized officers, and Grantee has caused its corporate seal to be hereto affixed, and these presents to be signed in its name and behalf by its duly authorized officers, all a's of the day and year first above written.

.PENNSYLVANIA POWER 6 LIGHT COMPANY By'ttest:

Secretary ALLEGHENY ELECTRIC COOPERATIVE, INC.

By Vice President Attest:

Secretary

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COMMONWEALTH OF PENNSYLVANIA, )

SS.

COUNTY OF LEHIGH )

On this, the day of March, 1977, before me, the undersigned officer, personally appeared who acknowledged himself to be a of PENNSYLVANIA POWER 6 LIGHT COMPANY, a corporation, and that, he as such being authorized to do so, executed the foregoing instrument for the purposes therein contained by signing the name of the corporation by himself as such IN WITNESS WHEREOF, I hereunto set my hand and official seal.

COMMOWaEALTH OF PENNSYLVANIA )

SS.

COUNTY OF LEHIGH )

On this, the day of March, 1977, before me, the undersigned officer, personally appeared who acknowledged himself to be a Vice President of ALLEGHENY ELECTRIC COOPERATIVE, INC., a corporation, and that he as such Vice President,. being authorized to do so, executed the foregoing instrument for the purposes therein contained by signing the name of the corporation by himself as such Vice President.

IN WITNESS WHEREOF, I hereunto set my hand and official seal.

CERTIFICATION OF ADDRESS The undersigned hereby certifies that the precise and complete post, office address of ALLEGHENY ELECTRIC COOPERATIVE, INC. the within named Grantee, is 2929 North Front Street, Harris-burg, Pennsylvania 17110 WITNESS my hand this day of March, 1977.

ALLEGHENY ELECTRIC COOPERATIVE i INC.

l APPENDIX A toe. R/W OR AGMZ~

GRANTOR EN FEE DATE RECORDED NORTEDSERLAND COUNTY UP~ AUGUSTA TOWNSHIP Raymond. A. Bahner &; Gussie K., his wife R/W 7-21-64 Vol 15, Pg 36 G. Edward Shock &: Alice B., his wife R/W 6-26-64 Vol 15, Pg 238 WER AUGUSTA TOWNSHIP G. Edward. Shock &, Alice B., his wife R/W 6-26-64 Vol 15, Pg 238

. CKEFELLER TO'rViSHlP G. Edward Shock &, Alice B., his wife R/W 6-26-64 Vol 15, Pg 238 James K. Baumbach &, Pauline G., his wife R/W 8-li64 Vol 15, Pg 199 Joseph A. Wallen &: Ruth M., his wife R/W 8-6-64 Vol 15, Pg 581 Carton L. Comfort 8c Gladys J., his wife R/W 7-28-64 Vol 15, Pg 208 Grace M. Roadarmel &: John R., her husband. '/W 7-X,-64 Vol'15, Pg 211 Noble R. Henninger 8c Margie L., his wife R/W 6-25-64 Vol 15, Pg 223 Clement M. Brown &: Iva M., his wife R/W 7-1-64 Vol 15, Pg 202 John Garinger R/W 7-2-64 Vol 15, Pg 217 Daniel A. Tressler &, Flo ence R., his wife R/W 12-22-64 Vol 15, Pg 242 Melvin K. Reader &, Nancy E., his wife R/W 7-6-64 Vol 15, Pg 232 Theodore Shipe R/W 7-1-64 Vol 15, Pg 235 Robert L. Bingaman 5 Lois N., his wife R/W 8-11-64 Vol 15, Pg 205 Russell F. App &, Christobel, his wife R/W 7-7-64 Vol 15, Pg 193 See Doc 19 Frank P. App, et al R/W 7-7-64 Vol 15; Pg 196 Nevin R. Garman Ec Darlis, his wife R/W 7-7-64 Vol 15, Pg 220 Edward W. Whitmer &, Gladys P., his wife R/W 7-11-64 Vol 15, Pg 371 Reginald Charles Schofield, R/W 7-21-64 Vol 15, Pg 359 Charles R. Hackenberg Ec Blanche l., his wife R/W 7-8-64 Vol 15, Pg 428

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APPENDIX A OC. . R/W OR AGMT.

O. GRANTOR IN FEE DATE RECORDED

'NORTHUMBERLAND COUiN'T OCKMEL~ TOWilSHIP Robert H. Lawrence &, Mildred N., his wife R/W 7-18-64 . Vol 15, Pg 513 8 Blanche B. Berger R/W 7-13-64 Vol 15, Pg 335 Paul L. Wolfe &: Doris A., his wife R/W 7-10-64 Vol 16, Pg 66 0 Henry W. Ross R/W 7-10-64 Vol 15, Pg 446

. VfOKIN TOWNSHIP 30 Henry W. Ross R/W 7-10-64 Vol 15, Pg 446 1

Harvey D. Klase R/W 7-17-64 Vol 15, Pg 356 A. Norman Dietrick & Dorothy >>., his wife R/W 10-5-64 Vol 15, Pg 214 Pearl S. Hollenbach 8c John A., her husband, R/W 8-1-64 Vol 15, Pg 229

'arley J. Ross &, Margaret I., his wife R/W 8-20-64 Vol 15, Pg 443 BOROUGH OF SNYDERTOWN Russell J. Fox, et al R/W 8-20-64 Vol 15, Pg 344 SHAMOKIN TOWiNSHIP Freeman W. Furman 8o phoebe, his wife R/W 7-20-64 Vol 15, Pg 347 Franklin H. Hoy 8 Edna L., his wife R/W 8-22-64 Vol 15, Pg 353 See Doc 36 ROUGH OF SNYDERTOWN 39 'ordon J. Hallman 8: Laura F., his wife R/W 8-15-64 Vol 15, Pg 350 OKIN TOWNSHIP Robert 0. Wilhour & Helene T., his wife R/W 7-31-64 Vol 15, Pg 368

. OUGH OF SNYDERTOWN Ray I. Swank & Annie N., his wife R/W 7-31-64 Vol'5, Pg 362

-HAMOKIN TOWNSHIP William B. Tasker 8:.Mary, his wife R/W 7-6-64 Vol 15, Pg 365

APPENDIX A R/W OR AGMT.

GRANTOR IN FEE DATE RECORDS)

NORTHUMBERL4%) COUNTY OUGH OF SNYDERTOWN Wal er J. Emerick 8: Shirley Mae, his wife R/W 10-5-64 Vol 15, Pg 341 William R. Clark Ec Carrie M., his wife R/W 6-24-64 Vol 15, Pg 338 OKZN TOWNSH:P Joseph L. Frey 5 Mary E., his wife R/W 6-30-64 -

Vol 15, Pg 572 William Howard. Clark 84 Dawn G., his wife R/W 7-24-64 Vol 15, Pg 416 See Doc 45 See Doc 46 I

OUGH OF SNYDrZTOWN

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tI William Howard Clark 8: Dawn G., his wife R/W 7-24-64 Vol 15, Pg 416 See Doc 45 See Doc 46 OKIN TOWNSHIP Pearl Miller Clark R/W 7-28-64 Vol 14, Pg 269 Earl S. Bohner &, Yertha J., his wife R/W 10-3-64 Vol 15, Pg 510 Philadelphia Reading Railroad Company M. E. Wallace Company R/W 11-12-64 Vol 15, Pg 522 Emma E. Snyder 8 Mary E. Aucker R/W 11-25-64 Vol 15, Pg 40 54 Carl F. Yarsky 8: Mary B. Yarsky R/W 7-13-64 Vol 15, Pg 578 H TOWNSHIP C. R. Prutzman, et al. R/W 7-13-64 Vol 15, Pg 516 Percy C. Swank R/W 11-21-64 Vol 15, Pg 519 Michael J. Doraski 8: Nellie, his wife R/W 7-8-64 Vol 15, Pg 419 William A. Lawrence Zc Isabelle C., his wife R/W 9-8-64 Vol 15, Pg 434 Char'es M. Scheetz 8: Regina M., his wife R/W 8-18-64 Vol 15, Pg 455

I: APPENDIX A R/W OR AGMT.

.iO. GRANTOR ZN FEE DATE RECORDED NORTHUlSERLAND COUNTY RUSrl TOWNSrIEP Randall C. Bartges & May L., his wife R/W 10-10-64 Vol 15, Pg 332 Bertha Romanowski R/W 11-27-64 'Vol 15, Pg 440 Oliver Perry Rothermel & Esther, his wife 10-8-64 Vol 15, Pg 449 Donald L. Savidge & P. Marjeane, his wife R/W 8-12-64 Vol 15, Pg 452 Williem B. Delbo & Glenene R., his wife R/tl 8-8-64 Vol 15, Pg 458 Williem Fisher & Anna W., his wife R/W 8-4-64 Vol 15, Pg 422 Doris Yvonne Blue & Earl L., her husband, R/W 7-22-64 Vol 15, Pg 410 Edward R. Ker & Shirley M., his wife 7-15-64 Vol 15, Pg 575 William J. Mutchler & Mary C., his wife R/W 7-22-64 Vol 15, Pg 437 George Bonetti & Alma R/W 7-16-64 Vol 15, Pg 413 Harold. L. Hart & Eleanor, his wife R/W 7-23-64 Vol 15, Pg 431 F

L o Girardi R/W 9-28-64 Vol 15~ Pg 425 George Edgar Roadarmel 'state R/W 4-5-65 Vol 16, Pg 226 MONTOUR COUilTY YBERRY TOWNSHEP DB 80, Pg. 162 Leo Girardi R/W 9-28-64 Vol 15, Pg 425 DB 81~ Pg, 303 George Edgar Roadarmel Estate R/W 4-5-65 Vol 16, Pg 226 William L. Roadarmel 8 Marion R., his wife R/W 12-7-64 Book 80, Pg 66 Bessie P. Reed R/W 8-20-64 Book 80, Pg 60 John L. Campbell & Julia P. >

his wife R/W 10-12-64 Book 80, Pg 63 See Doc 73 Anthony A. Abraczinskas & Anna R., his wife R/W 9-15-64 Book 80, Pg 299 Simon Wesolowski & Margaret, his wife R/W 8-15-64 Book 80, Pg 57 S anley Hummer & Dorothy H., his wife R/W 8-22-64 Book 80, Pg 165 Stanley Bialecki & Sophia, his wife R/W 8-10-64 'ook 80, Pg 69

APPENDIX A

)DOC. R/W OR AGhfZ.

NO. GRANTOR 2f FEE DATE RECORDED 1'.ONTOUR COUNTY

<<AYBZBY TOWNSH1P Maxi Manufacturing Company R/W 8-25-64 'ook 39, Pg 983 Book 40, Pg 157 Book 81, Pg 359 COLUt&TA COUNTY TOWNSHIP Maxi Manufacturing Company R/W 8-25-64 Book 39, Pg 983 83'iiKZf Book 40~ Pg 157 Book 81, Pg 359 82 Newton M. Vought Estate 8c Charles &, Sarah R/W 4-5-65 Book 39~ Pg 1031 Woodruff Estate Book 40, Pg 135 Lorenzo L. Fetterman 8c Mildred. C., his wife R/W 8-27-64 Book 39, Pg 817 Book 40, Pg 139 Adali C. Rohrbach 0 Hazel A., his wife R/W 9-2-64 Book 40, Pg 132 See Doc 83 .

Sue t4. Miscannon R/W 9-9-64 Book 39, Pg 825 Myra H. George R/W 8-31-64 Book 39, Pg 819 Krum Brothers, Partnership R/W 9-10-64 Book 39, Pg 809 Ralph J. Getty R/W 8-28-64 Book 39, Pg 974 L., his wife

'/W 0 Ray S. Adams 5 Erma 9-24-64 Book 39, Pg 980 Carrie A. Rhodes R/W 9-15-64 Book 39, Pg 993 92 Jos. T. Reeder k Elma R., his wife R/W 9-8-64 Book 39, Pg 813 Warren N. Shuman, et. al. R/W 1-5-65 Book 39, Pg 990 Paul Smoczynski, et.al, R/W 1-8-65 Book 39, Pg 1057 Xra Breech 8c Cora, his wife R/W 9-1-64 Book 39, Pg 1025 Neil V. Levan &: hery, his wife R/W 9-1-64 Book 40, Pg 13 Wilson W. Hauntzelman 8c Edna L., his wife R/W 9-24-64 Book 40, Pg 16

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APPENDIX A OC.

'0. GR43TOR '/W OR LV FEE AGMT.

DATE RECORD-D

<ATAWZSSA TO'wTSHIP COLLEGIA COU'1 Neil V. Levan 8c Mary, his wife R/W 9-1-64 Book 40, Pg 13 Wilson W. Hauntzelman 8: Edna L., his wife R/W 9-24-64 Book 40, Pg 16 Gerald. H. Johnson Zc Sara, E., his wife R/W 9-24-64 Book 40, Pg 129 Walter C. Napierski 8: Stella A., his wife R/W 11-3-64 Book 39, Pg 964 100 J. L. Rider 4 Pearl M., his wife R/W 9-29<<64 Book 40, Pg 19 Roy'. Drumheller 8: Louene E., his wife R/W 9-21-64 Book 39, Pg 971 02 Henry Leighow 5 Charlotte, his wife R/W- 9-29-64 Book 39, Pg'967 03 Dorothy E. Troy, .et al R/W 9>>21-64 Book 40, Pg 32 4

fal The Municipal Authority of the Borough of Catawissa R/W 11-17-64 Book 40, Pg 150 Paul B. Leighow 8c Kathryn, his wife R/W 10-15-64 Book 40, Pg 337 Minnie Pohe Creasy R/W 1-21-65 Book 40, Pg 363 Pennsylvania Game ComMssion (Lic.) R/W 7-23-65 Hiram R. Hershey 8c Dorothy K., his wife R/W 4-29-65 Book 40, Pg 29 foe

'09 Philadelphia Reading Railroad. Company Xiii TONHSHEP Sarah W. Thomas R/W 10-15-64 Book 40, Pg 169 Louis J. Karas, et al R/W 10-20-64 Book 40, Pg 221 P2 Pennsylvania Railroad Company 1

13 0. Roy Gordon, et al R/W 10-16-64 Book 40, Pg 576 Ray H. Shuman 8c Evelyn H., his wife R/W 10-20-64 Book 40, Pg 163 115 Lynn Posey 8c Anna, his wife R/W 12-15-64 Book 39, Pg 1028 Mildred, D. Vought R/W 10-24-64 Book 40, Pg 175 fl7 Albert S. Schutz Bc Helen,. his wife R/W 12-7-64 Book. 40, Pg 166 I

APPENDIX A gc. GRANTOR R/W OR AGMT.

DATE RECORDS)

COLUMBIA COUNTY TOWNSHIP Homer E. Shuman 8c Jennie E., his wife R/W 11-17-64 Book 40, Pg 207 Norman J. Simmons, Jr. 8 Ruth H., his wife R/W 10-19-64 Book 40, Pg 284 fc See Doc 118 121 Edith E. Diehl R/W 10-20-64 Book 40, Pg 210

=Lucele Crouse Slusser 8c Ambrose D., her husband R/W 10-28-64 Book 40, Pg 172 f

123 Osca S. Johnson &: Mary H., his wife R/W 10-21-64 Book 40, Pg 204 a~ Norman J. Simmons, Jr., 8c Ruth H., his w'fe R/W 10-19-64 Book 40, Pg 281 Mary C. Rhodes R/W 10-21-64 Book 40, Pg 213 See Doc 123 Robert C. Bronson 8c Audrey H., his wife R/W 11-4-64 Book 39, Pg 1019 Henry W. Mathieu, Jr. 8c Marie.H., his wife R/W 1-15-65 Book 40, Pg 201 r LIN TOWNSHIP Allen Parr 8c Mildred, his wife R/W 1-9-65 Book 40, Pg 123 Raymond, A. Breach 8'c Elsie M., his wife R/W 10-19-64 Book 40, Pg 154 Kenneth W. Snyder &; Althea H., his wife R/W 12-16-64 Book 40; Pg 126 132 Ray E. Huntington &, Myrtle M., his wife R/W 11-28-64 Book 40, Pg 144 m~ Charles W. Houck 8'c Sarah S., his wife R/W 10-19-64 Book 40, Pg 147 Stella I. Knecht R/W 10-21-64 Book 40, Pg 141 Marco Mitrani 8c Louise, his wife R/W 12-15-64 Book 39, Pg 987 Arthur M. Gruver R/W 1-15-65 Book 40, Pg 224 137 Roland B. /filler R/W 2-3-65 Book 40, Pg 391 Fred T. Aten 8'c Inez, his wife R/W 1-11-65 Book 40, Pg 325 Carl D. Shaffer 8c Odra, his wife R/W 10-23-64 Book 40, Pg 340 Robert F. Hoagland 8c Esther, his wife R/W 11-20-64 Book 40 Pg 309

APPENDIX A C~ R/W OR AGMT.

GRANTOR DATE RECORDED COLUt GAIA COUNTY FLZi TOWNSHIP

'41 Michael Defebo Amelia, his wife 12-10-64 I

&c R/W Book 40, Pg 272 William M. Comstock &c Anna Mary, his wife R/W 11-17-64 Book 39, Pg 1022

'3 George DiFebo &c Roxine, his wife R/W 1-8-65 Book 40, Pg 328 James F. Magee,&: Arlene R., his wife 11-24-64 Book 40, Pg 198 Wilbur H. Knecht Estate R/W 5-3-65 Book 40, Pg 331 146 Robert C. Chapin 8: Hazle Mae, his wife R/W 12-22-64 Book 40, Pg 334 L7 Thomas E. Wilson 8: Helen A., his wife R/ 1-4-65 Book 40, Pg 275 Stephen J. Knelly 8 Allie May, his wife R/W 11-30-64 Rook 40, Pg 278 Arthur E. Andreas &c Leola I., his wife R/W 12-17-64 Book 40, Pg 312 0 Lyle White R/W 11-18-64 Book 40, Pg 322 151 Donald. S. Lamon &: Joan, his wife R/W 11-9-64 Book 40, Pg 319 I2 The Susquehanna Valley Beagle Club R/W 1-21-65 Book 40,'g 315

-' James Cusatis &: Concetta, his wife R /W 11-11-64 Book 40, Pg 35 Glenn E. Miller &: Sarah J., his wife R/W 11-9-64 Book 39, Pg 977 David E. Zanoline &: Clara T., his wife R/W 11-9-64 Book 40, Pg 431

-Book 1574, Pg 1185 LUZERNE COUsiY

ESCOPECK TOWNSHIP David E. Zanoline &c Clara T., his wife R/W 11-9-64 Book 40, Pg 431 Book 1574, Pg 1185 Roy W. Densberger &

Frances A., his wife R/W 12-4-64 Book 1567, Pg 830 Commonwealth Land, Coal and, Iron, Inc. R/W 7-12-65 Book 1583, Pg 759 Frank Moser &: Phebie, his wife R/W .11-24-64 Book 1574, Pg 1181.

Katherine C. Drasher R/W 11-30-64 Book 1574, Pg 1196 APPENDIX A Icc. R/W OR AGPZ, GRANTOR Ql FEE DATE RECORDED LUZ"KX~ COURTLY SCOPECK TGBlSHXP Mary A. Foster Estate R/W 5-10-65 Book 1571, Pg 96 Peter Yudiski R/W 2-27-65 Book 1573, Pg 570 Floyd. W. Paden gc Edna M., his wife 12-1-64 Book 1573, Pg 582 Stephen Yudiski & Fern, his wife 3-11-65 Book 1573, Pg 594 Walter Yudiski &, Carol, his wife R/W 2-27-65 Book 1574, Pg 1177

-l.65 Michael Godleski &, Mary, his wife R/W 2-18-65 Book 1574, Pg 26 L Ray W. Paden 8c Minnie, his wife R/W 11-24-64 Book 1574, Pg 1173 Charles E. Heckman R/W 11-7-64 Book 1574, Pg 1169 o8 PP8cL Co. formerly E. Floyd. Seely 8c Laura M. Zn Fee 10-30-09 DB 504, Pg 386 Stanley Zehner, et al R/W 1-29-65 Book 1573, Pg 578 170 Clark F. Hess 8: Arlene E., his wife R/W 1-29-65 Book 1573, Pg 590 al Warren E. Ryman & Elizabeth J., his wife R/W 1-29-65 Book 1576, Pg 492 Ross Ryman &, Dora M., his wife R/W 1-29-65 Book 1576, Pg 735 2.1 PP8cL Co. formerly; Xn Fee (a) G. Raymond Brown 8c Nu'tha 11-13-64 DB 1559; Pg 341 Wilmer F. Brown & Y~ie W.

(b) Consolidated Rendering Company 2-2-65 DB 1564, Pg 574 (c) Frank P. Barletta, et al 4-8-65 DB 15670 Pg 954 Co-Partners T/A 4

A; Barletta gc Sons 173 Consolidated. Rendering Comoany R/W 10-15-64 Book 1564, Pg 590 J. A. and W. A. Hess, inc. R/W 5-6-65 Book 1583, Pg 455 175 Bazil Adrezze, et al R/W 12-1-64 Book 1587, Pg 1091 See Doc 174

~

APPENDIX A R/M OR AGMT.

GRANTOR IN FEE DATE RECORDED LUZEKK COUNTY SCOPECK TOWNSHIP 177 Henry P. Morgan, et al R/M 1-4-66 Book 1587, Pg 83 Guy D. Thomas 8: Florence M , his wife R/N 1-28-65 Book 1583, Pg 387 Woodrow Hartzel 8c Margaret, his wife R/M 2-1-65 Book 1583, Pg 367 8-16-72 DB 1794, P. 940 Penn Central Railroad See 179 Susquehanna River Crossing

".-ALEM TONii SHIP Kenneth Arthur Church 8c Evelyn Mae, his wife 10-18-73 DB 1802, P. 547 R/M'/N Helen P. Lazarus 8-15-72 DB 1790, P. 789 See 183 Erie-Lackawanna Railroad Josephine Markovich In Fee 1-2-73 DB 1771, P. 776 Robert M. Killian 4 Jean H., his wife In Fee 7-7-71 DB 1724, P. 791 I

I l

Exhibit B TWO NORTH NINTH STREET, ALLENTOWN, PA. 18101 PHONE: (215) 821-5151 March 18, 1977

.BILL OF SALE 1

Allegheny Electric Cooperative, Inc.

2929 North Front Street Harrisburg, Pennsylvania 17110 Attention: Mr. William F. Matson Costs, as of February 28, 1977, related to Preliminary Engineering, Planning, and Design for the Sunbury-Susquehanna 500 KV Electric Transmission Line. $ 201,228.78 PENNSYLVANIA POWER & LIGHT COMPANY By:

Attest:

ALLEGHENY ELECTRIC CCOPERATIVE, INC.

By:

Attest:

PENNSYLVANIA POWER 8 LIGHT COMPANY

EXHIBIT C REDUCTION IN POWER DELIVERED The reduction in power quantities as provided in Article V of this Agreement, representing the estimated annual'oss pere'entages incurred by PL on transmission facilities rated 220 Kilovolts and above relative to estimated total net annual intraterritorial PL generation (where such estimates are based on PL analyses utilizing two repre-sentative load periods), shall be 1. 5%.

Exhibit D KENNEDY FAMILY Joseph P., Sr. (d.) 6 Rose Kennedy seph P., Jr. (d.) John F. (d.) (d.) Robert F. (d.) Edward Moore Jr'athleen I None Caroline None Kathleen Kara Ann John Fog Hartington Edward Moore Robert F., Jr. Patrick Joseph Joseph Patrick David Anthony Mary Courtney Michael L.

Mary K.

Christopher Matthew Eunice (Shriver) Jean (Smith) Patricia (Lawford) RoseMary Robert Sargent III Willie Christopher None Maria Qwings Stephen, Jr. Sydney Tinothy Perry Victoria Mark Kennedy Robin

EXHIBIT E RIGHTS AND INTERESTS IN PROPERTY INCLUDED IN THE LINE PROJECT, LINE ADDITIONS AND LINE

1. That portion of the SOO kilovolt Transmission Line (generally referred to by PL as the Sunbury-Susquehanna 500 Kilovolt Line) constructed or to be constructed on the Right of Nay.

2. Inventories of material, supplies, tools, equipment, and facilities and other items specifically designated for us'n connection with the construction and operation of Line Project, Line Additions and Line, as the case may be.

3. All of the following which are used or to be used in respect of Line Project, Line Additions and Line, as the case may be,'a) contracts including advance payments made relative thereto; (b) choses in action; (c) causes of action.

4. All other tangible and intangible property, used or to be used in respect of Line Project, Line Additions and Line, as the case may be.

I, h

-!rema" f"<5 COST,.'TRENDS. OF ELECTRIC LIGHT AND POWER CONSTRUC-ht, e

.:-":>>."',"'-v; -, TABLE

,-:-"","TION,'.'NORTH,ATLANTIC DIVISION '-'.:;"--"~; -'

',e'f'-,!1949,=100 ."

t COST tNDEX INUMBERS I ere I!!

OF CONSTRUCTtON FPC AND LABOR ELEMENTS ACC. I C.

"--'x'LASSES

".g Cl tht Total Plant-All Steam Generation ~ ~ ~ ~ ~ ~ 25 26 25 25 26 33 48 SI 5$ 50 46 48 49 49 Total Plant-All Hydro Generation ~ ~ ~ . ~ ~ 26 31 47 50 54 52 50 50 Sl 51 51 Total Plant-Stcam &. Hydro Generation . 26 32 47 50 54 $3 49 50 Sl 51 Sl Total Stcam Production Plant 22 22 22 23 29 47 65 50 45 46 48 47 47 ts v Structures tL Improvements-indoor ........., 311 25 33 52 59 53 51 53 54 $3 53 Structures dc Improvements-Semi Outdoor .... 311 Boiler Plant Equlpmcnt-Coal Fired . . ~...... ~ 312 22 22 22 24 29 53 47 4S 40 44 47 .I i Boiler Plant Piping Installed 34 34 34 34 29 37 61 67 68 61 57 60 62 64

, tv Turbogcncrator Units .......... 314 19 19 19 19 19 27 29 37 41 49 43 41 41

...I Accessory Electrical Equipment . 31$ 29 30 30 30 31 35 39 47 56 60 56 56 57 $8 Misc. Power Planl Equipmcnt .. 316 r," 4-;,>>

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Structuresd! Improvements . 321 Reactor Plant Kquipmcnt .. 32s t' ~

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Total Hydraulic Production Plant...... 23 28 38 46 50 49 46 47 48 48 Structures 4 Improvements..... ~..... 331 2$ 33 45 48 52 59 53 SI $3 54 $3 S3

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Reservoirs, Drms, dc VVatcrways ....... 332 23 28 39 46 48 52 $2 49 50 52 51 52 rz IVater wheels, Turbines, dc Generators ~ 333 21 25 31 36 38 39 37 3$ 34 35 35 35 hf fy. ~ I

\

, p'f Gas Turbogencrators.. "-"(

,.>, j Total Transmbsion Plant .. 26 27 27 26 27 33 41 48 SI 56 53 50 SI 52 52

';< t Station Equipmcnt "" ~" 353 28 29 29 28 29 32 38 47 52 58 58 53 54 56 56 Towers dc Fixtures 354 25 26 26 25 26 36 48 50 50 $2 51 48 48 Sl Sl Poles& Fixtures ................. ~ 355 18 19 20 20 20 23 27 38 50 38 42 43 43 41 Overhead Conductors dc Devices "~ ~ ~ 356 32 37 35 32 34 52 59 68 71 73 53 50 54 54 56 \(

Underground Con duit........ ~ ~ ~ ~ ~ ~ 357 19 20 21 21 22 31 50 $4 SI 47 49 50 48 e-.'"t.'t I Underground Con ductors &e Devlees 358 22 25 23 22 23 33 38 44 47 48 39 38 4S 43 43 t 1 -- 'YII " rh Total Distribudon Plant .. ~ "" ~ 28 29 29 28 29 34 40 48 52 $6 $5 52 52 53 53 ".hr'.

'2 j'8 Station Equipment 362 32 32 32 33 34 36 42 52 57 62 62 58 $9 60 61 Poles, Towers dc Fixtures ....... 364 18 19 19 18 19 21 28 32 36 41 42 41 43 44 Overhead Conductors dc D<<vices . 365 32 37 35 32 34 52 59 68 71 73 53 50 54 54 56 55 C r.;q r>>

Underground Conduit,..................... 366 21 22 23 23 24 26 34 54 59 55 SI 53 54 52 Underground Conductors & Dcv.-ln Conduit, 367 22 25 23 22 23 33 38 47 48 39 38 4S 43 43

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~ =.', I-,;r. Une Transformers 368 48 48 48 48 52 70 74 78 80 71 69 71 70 6s II

............... s r t

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Pad Mounted Transfonncrs 368 I.

Services Overhead.......,......,... ~ ~ ~ 369 31 35 33 31 33 48 5$ 65 69 70 50 48 52 52 54 Services- Underground................... 369 28 27 27 28 32 37 44 54 59 59 48 43 46 46 49 si Mctcrs, Installed............... "" """ 370 49 56 62 65 69 65 62 61 59 59 -"!

Street Ughting-Overhead ................ 373 Sl SI Ivelatt Arms & Luminaircs Installed 373 'Y Street Ughting-Underground ............. 373 53 53 54 II Electr!>> Labor... 19 18 19 21 21 28 32 36 40 41 42 Sl 8 It

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'~M 47 48 50 48 47 49 50 SI 56 $6 56 58 60 62 62 62 64 75 86 95

.<<E3 ~, 1 50 $l 53 $I $0 47 50 fp Sl 55 56 $6 57 60 63 64 65 67 74 87 97 6l 96 '1 50 SO 53 5l 49 47 50 5I 53 57 57 58 58 63 64 65 66 73 86

~I 47 47 49 48 47 43 49 50 SI 56 $7 57 58 6I 62 62 62 63 73 83 94 53 Sl 5l 50 46 43 47 46 47 Sl Sl SI 52 $6 59 60 60 63 70 8I 94 rE'.]

4$ 4S 45 39 39 46 48 S3 $5 56 59 6I 6l 6l 6I 68 77 9l 65 66 67 67 66 60 $4 54 55 56 64 64 64 65 68 7l 72 72 7l 79 89 98 Er 4l 46 48 46 4S 47 53 55 55 62 63 63 63 63 63 63 63 65 75 90 96 56 57 60 59 57 55 55 60 60 6l 66 66 67 69 69 70 1I 67 69 82 94 91 49 49 50 50 47 43 43 46 47 48 Sl 52 53 54 58 52 62 63 65 73 84 96

$3 Sl $l 50 47 43 43 41 46 47 SI Sl SI 52 56 59 60 60 63 70 8I 94 52 $3 $3 f3 50 45 45 48 48 48 52 53 53 54 57 6I 6I 63 65 72 83 96 36 37 39 39 39 37 38 4I 46 47 50 53 $5 58 62 64 65 65 66 76 90 97 q I,.,.-.-:

Sl $2 $6 $2 Sl 48 49 52 53 55 59 $9 59 60 63 65 65 65 67 74 87 96 55 55 ,$ 9 57 56 54 $6 6I 62 63 67 68 69 69 70 7I 10 67 67 7$ 89 94 .E,-"<<

<</D IM 1 Sl 50 51 Sl 50 4$ 47 48 50 54 54 55 $6 60 63 64 64 66 74 8$ 96

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40 40 40 39 39 35 3l 38 40 40 44 45 47 49 53 55 58 63 70 7$ 90 98

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54 48 57 48 62 48 53 47 49 46 42 46 35 52 52 47 55 47 59 50 56 52 56 54 59 55 60

$7 65 59 67 6l 69 62 70 67 83 75 9$

86 IPO 96

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~trtr 4l 49 40 40 37 40 43 43 47 Sl 47 48 49 55 57 57 56 56 67 79 92 '

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SI SZ 54 52 Sl 49 48 Sl 52 53 57 58 58 59 61 64 65 66 68 75 89 91 II, 56 55 57 57 56 54 54 58 59 60 64 65 66 68 69 69 69 67 70 8I 9I 95 CIE S, ~

42 42 42 43. 42 39 38 40 40 4I 46 48 50 53 58 60 66 70 74 90 99 ffj II B, 54 57 62 53 49 46 $2 52 55 59 56 56 59 60 6$ 67 69 70 83 95 lpp 52 52 52 SI 50 46 38 48 SI SI 54 57 59 62 6$ 66 68 15 86 95 4I 49 40 40 37 40 43 43 47 SI 47 48 55 57 57 56 56 67 79 92 ft 6I 60 64 63 6l 59 6I 62 63 63 68 70 Vp 70 12 7I 67 67 67 75 93 96 SI 56 6l Sl 48 44 45 SI Sl 53 57 55 56 58 60 64 67 69 70 82 94 !00 49 47 48 46 4l 44 46 49 5$ 53 52 56 63 65 67 68 70 8I 9I 99 '"-]

59 59 60 60 60 60 62 66 68 68 68 68 68 68 69 69 69 69 69 76 87 92 f

48 Sl SI SI 50 48 49 53 53 54 56 $6 55 57 60 6l 62 63 63 7l 86 92 1'1 54 $4 $6 $1 $6 $6 59 59 59 6I 61 62 63 65 66 70 70 74 90 98 52 53 $6 56 57 57 SI 50 52 54 58 62 63 65 68 68 69 70 74 83 91

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. ".;:TION-'""NORTH'TLANTIC. DIVISION "a-v:~e -~".-/47@949 =.100.';g-'.4g

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Total Plant-All Steam Generation ......

Total Plant-All Hydro Generation ......

100 100 104 105 116 114 119 117 125 123 12$

121 132 131 143 141 152 148 156 152 159 ISS 158 157 157 157 155 157 I

C r ', Total Plant-Stcam & Hydro Generation . 100 105 114 117 123 127 130 141 149 153 156 156 ISS 154

<<<<'4< I Plant...................

Total Steam Production 100 103 113 114 120 124 128 144 157 164 167 165 163 158

/ Structures &, Improvements-Indoor ............. 311 100 104 I IO III 114 119 124 133 142 146 150 152 I5 I 152 Structuresdc Improvements Semi Outdoor ..... 311 100 100 100 102 108 112 118 132 144 147 151 ISI 146 147 Boiler Plant Equipment-Coal Fired ............. 312 100 105 116 118 123 12$ 134 152 169 174 181 183 182 180 Boiler Plant Piping installed ... 100 I IO 120 125 130 140 145 163 178 183 193 201 201 204 Turbogenerator Units.......... 314 100 IOI 110 IIO 118 121 124 144 160 170 168 159 159 144 Accessory Electrical Equfpmcnt . 3 IS 100 108 123 125 132 135 136 144 154 159 158 141 132 126 Mise. Power Plant Equipment... 316 100 104 107 I IS 120 123 127 136 144 1$ 0 154 157 158 159

',1 iP Structures thymprorements .. 321

,Iv I, Reactor Plant Equipment ... 322 7

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Structuresde Improvements...........

VVatcr IVhccis, Turbines, & Generators ..

331 332 333 100 100 100 100 105 104 105 107 I IO I IO 108 117 114 III 112 123 121 114 118 134 125 119 123 137 130 124 128 141 142 133 138 161 153 142 147 178 159 146 152 187 164 150 159 190 167 152 163 191 168 151 162 195 168 152 165 185

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TotaITransmisslonPlant........... 100 106 118 122 127 130 135 145 148 1$ 2 154 152 149 147 Station Equipment ................ 353 100 107 121 124 130 133 135 147 ISS 161 158 147 139 129 Towers dc Fixtures................. 354 100 107 I IS 119 125 130 133 142 151 158 164 168 169 172 '<<

PolesEcFixtures .................. 355 100 104 114 120 125 129 133 144 1$ 3 156 159 164 164 167 Overhead Conductorsdt Devices..... 356 100 106 116 122 126 133 141 ISS 163 161 156 158 157 157 v t/'w Ry c<<

<<I Underground Conduit ............. 357 100 104 III I 15 121 125 130 139 147 154 15$ 162 164 168 Underground Conductors Ec Devices . 358 100 107 131 135 134 137 143 140 123 122 126 129 126 127

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Underground Conduit........................ 366 100 105 I I0 114 118 123 127 134 141 147 152 157 159 162 Underground Conductors <<fc Dcv.-ln Conduit ... 367 100 107 131 135 134 137 143 140 123 122 126 129 126 127 Line Transformers................ 368 100 104 118 118 125 128 128 132 139 135 131 128 126 126 Pad Mounted Trans(ormcrs .. ~... ~ . 36$ 100 100 100 100 100 100 100 100 100 100 100 97 95 92 Services-Overhead .............. 369 100 106 116 122 130 131 140 150 143 143 151 ISS IS4 157 Services-Underground ,... "" " ~ 369 100 103 118 119 119 117 116 122 120 114 116 112 I IO 113 Slcters, Installed ................. 370 100 100 100 99 103 105 I0 I 105 III 114 117 118 118 111 Street lighting-Overhead " """ 373 100 105 114 118 120 127 12$ 135 146 153 153 152 153 150 Mast Arms dc I.umlnalres Installed" Street lighting-Underground 373 373 100 98 107 108 I IO 120 100 124 III

!27 122 137 122 142 I I5 143 I I5 145 I IS 145 116 140 ~

io;.l, Electric Labor 100 tww<<wr /vr/<<

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COST INDEX NUMBERS t-',

1962 1963 1964 I965 1966 [967 196& 1969 1970 I97I

>> [55 157 157 157 1$ 9 162 164 161 169 172 [15 179 182 184 188 195 203 212 217 229 c 157 160 160 161 162 166 [67 172 174 177 ISO . I&5 189 192 196 204 213 223 228 241

• 154 1$ 6 156 156 ISS 16[ 163 167 169 172 174 179 182 184 188 195 203 213 217 230

~>>

159 160 160 159 161 163 165 167 169 171 173 178 179 182 185 191 196 205 213 226

[53 [56 1$ 6 ISS 159 162 162 165 168 171 [73 177 I&I 186 190 199 205 215 228 242 148 149 149 150 152 153 IS4 156 ISS [61 162 16S 170 173 178 186 192 201 211 22[

182 182 182 182 186 186 189 190 193 194 197 202 204 208 209 217 222 231 237 251 204 204 204 208 208 208 208 2[5 2[5 220 222 230 230 235 239 246 2$ 0 271 280 303 (>>

144 144 144 143 143 146 146 146 ISO 150 150 ISS IS[ 15[ 158 158 162 ~

171 176 190 f [27 130 130 [23 126 132 139 143 143 144 149 ISS 162 162 [64 166 175 IS I 183 194 159 161 162 163 165 166 169 171 [72 [75 179 183 ISS 191 196 202 209 2[7 226 234

[00 102 103 105 106 109 114 117 124 129 135 141 149 ,!-

100 102 103 10$ 106 109 113 11$ 119 123 129 133 139 f'c7 16S 172 173 174 175 179 180 183 186 190 192 198 201 207 212 221 229 240 248 26[

153 [56 1$ 6 ISS [$9 162 [62 165 168 171 173 177 181 186 190 199 205 215 227 242 /J>>

C

>>// 166 171 172 113 [75 179 179 184 c 187 [91 193 200 203 211 2[4 225 233 244 254 268 />> c

• 186 186 186 [87 188 191 192 192 197 199 201 206 201 2[0 221 223 232 242 244 255 *

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-'.- I 101 101 101 103 104 I IO 116 [2[ [21 [25 [26 126 132 134 136

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[48 [50 [41 148 IS[ ISS [59 [65 165 169 173 178 [82 183 186 195 204 212 213 226 13[ 132 123 120 [26 129 134 138 138 14[ 144 149 [52 154 156 ISS 161 165 172 170 I ~

[13 176 177 180 182 ISS 190 197 200 207 210 217 219 225 230 248 253 260 267 279 167 170 171 174 175 [79 ISI 187 190 193 198 203 202 209 2[3 224 232 240 248 256 c/

161 164 156 147 IS I 160 165 168 168 175 176 I&I ISI 179 180 192 2 IS 220 227 247 c'E 169 172 174 176 177 182

'r 127 127 127 128 130 182 137 149 189 IS I 190 149 194 197 203 204 212 2[6 229 231 252 259 279

• t 153 154 157 157 [46 148 16[ 115 183 139 17b

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[41 149 149 [$0 151 154 157 161 163 166 169 174 178 180 184 191 20[ 2[0 214 226 c".

' 139 142 140 134 140 140 144 141 147 149 IS[ 156 168 170 173 173 117 181 ISS 183 160 [63 164 167 168 112 173 180 182 ISS 190 194 193 200 204 2[4 224 233 243 253 163 166 167 169 170 !75 179 186 187 194 196 203 219 212 c

217 231 2S7 266 276 297 i .0".I, <r>>

I c

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163 127 119 92

[67 127 113 92 168 127 108 92 c

170 12S 107 93 17[

130

[07 93 175 137

[01 85 176 149 107 89 180 ISI 109 89 180 149 109 86 183

[53 109 91 183 IS4 1[0 97 187 157 I[3 9[

189 1$ 7 116 95 193 146 119 96 198 148 116 97 206 16[

I[3 90 215

[7$

I [4 91 230 183 I[$

93 239 139

[16 94 253 180 117 ct/

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