ࡱ> \^[%` ?bjbjٕ 1N[6   2zzz8$2d0h///////$1h44z 0 00p//x,.  뼩z%|.(/\400d0+.44P.4."  0 0%dd0222d222222 CONFIDENTIAL Attachment A to Bid Price Proposal of TransCanada Power Marketing Ltd. (the Bidder) Bidder Conditions The Bidders offer to provide standard offer service at the prices described in its Bid Price Proposal is made subject to the acceptance by the Commission of the following conditions as expressly stated herein, without modification except upon the written agreement of the Bidder. The Commissions order designating the Bidder as a standard offer provider (the Provider) shall expressly incorporate each of the conditions stated herein (the Order). Upon such acceptance and designation, the Bidders resulting rights and obligations as Provider shall consist of (i) the applicable and material provisions of fb88 law and regulations, and provisions of the RFP; (ii) the Order, incorporating the express conditions of this Bid Price Proposal; and (iii) the Standard Offer Provider Standard Service Agreement described below (collectively, the Standard Offer Obligation). In the event of any conflict or inconsistency between the terms and conditions of the Order and any other terms and conditions described above, the terms and provisions of the Order shall prevail and be given priority. Subject to the foregoing, the several documents and instruments forming the Standard Offer Obligation are to be taken as mutually explanatory of one another and in the case of ambiguities or discrepancies within or between such parts the same shall be explained and interpreted, if possible, in a manner which gives effect to each part and which avoids or minimizes conflicts among such parts. Bid Price Proposal Expiration Date. The Bidders Bid Price Proposal shall remain effective and binding until the close of business on July 29, 2008. If Bidder receives the Commissions Order designating the Bidder as the Provider before the close of business on July 30, 2008, T&D and Bidder shall, no later than July 31, 2008, execute final, definitive documentation regarding the Standard Offer Obligation and any other obligations awarded to the Bidder by the Commission (such documentation to be substantially in the form agreed to by the Bidder, T&D and the Commission prior to the submission of Bidders Bid Price Proposal and containing subsequent non-substantive changes mutually agreed upon by the Bidder, T&D and Commission). Confidentiality of Bidder Identification. The Commission agrees not to reveal the identity of the Bidder prior to the date that is two (2) weeks after the date of the Order designating Bidder as Provider. Increased Costs Associated With Change in Law. If the fb88 legislature or the Commission enacts, promulgates, adopts, alters, modifies or waives any law, rule or regulation that relates to the provision of standard offer service or the provision of competitive electric service in general after the date hereof, or if the definition of rate classes, as presently defined by each T&D, changes (a "Change in Law") and such Change in Law materially increases the Providers cost to provide standard offer service, Provider shall recover such increased costs in accordance with paragraph (a) or paragraph (b) below, as applicable. Provider shall provide the Commission and, if applicable, the fb88 Legislature with a calculation of its increased costs as soon as practicable after becoming aware of a Change in Law or consideration by the Commission or the fb88 Legislature of a Change in Law. (a) If the Commission finds that Providers calculation reasonably reflects its increased costs, the Commission shall increase the price of standard offer service paid by retail standard offer customers at the time a Change in Law becomes effective so that Provider recovers increased costs in accordance with Providers calculation. (b) If the Commission does not find that Providers calculation reasonably reflects its increased costs, the Commission may increase the price of standard offer service paid by retail customers such that Provider recovers increased costs in accordance with the Commissions calculation. In this event, Provider may invoke binding arbitration of the increased cost amount by notice to the Commission. Any such arbitration shall be conducted in accordance with the rules of the American Arbitration Association, except as otherwise provided herein. A final arbitration decision shall be rendered no later than ninety (90) days after the date on which Provider provides notice to the Commission that it has invoked arbitration. From and after the date of Providers arbitration notice and until the conclusion of any such arbitration proceeding pursuant to final decision of the arbitrators, Provider may recover from the T&D the difference between the increased cost amount as calculated by Provider and the amount being paid to Provider in respect of such increased costs. If the amount awarded pursuant to such arbitration is materially less than the amount recovered by Provider from the T&D in respect of the Change in Law during the pendency of the arbitration, Provider shall refund such difference to the T&D, together with interest on such difference calculated at a rate equal to the lesser of (i) eighteen percent (18%) and (ii) the maximum rate permitted by applicable law. To the extent the arbitration panel finds that a change in law has increased the Providers costs and that the Provider is entitled to a corresponding increase in the price of Standard Offer Service, the arbitration panel will have the authority to award the Provider a liquidated amount payable for service already provided at the increased cost, provided that, Provider has not already recovered the increased costs from the T&D. T&D shall pay such amount to Provider with interest calculated from the date the Change in Law took effect, and such rate shall equal the lesser of (i) the per annum rate of interest equal to the prime lending rate as may from time to time be published in The Wall Street Journal under Money Rates on such day (or if not published on such day on the most recent preceding day on which published), plus two percent (2%) and (ii) the maximum rate prescribed by law. Notwithstanding the foregoing, if upon receipt of reasonable prior direct notification of a proposed Change in Law, Provider fails within the time prescribed in such notice to inform the fb88 Legislature or the Commission, pursuant to applicable procedures identified in such notice, of the impact that a Change in Law under consideration would have on Providers cost to provide standard offer service, Provider shall not be entitled to cause the Commission to undertake action with respect to its increased costs or to engage in arbitration proceedings with respect thereto as provided in clause (a) or (b) above. Basic Understandings: (a) To the extent applicable, it is the intent of the Provider that: (i) neither the Provider nor the T&D shall have the unilateral right to make a filing with Federal Energy Regulatory Commission (FERC) under any Section of the Federal Power Act, or with the Commission, seeking to change the charges or any other terms or conditions set forth in the Standard Offer Obligation (the SOP Agreement) for any reason; and (ii) any authority of the FERC or the Commission to change the SOP Agreement be strictly limited to that which applies when the contracting parties have irrevocably waived their right to seek to have the FERC or the Commission change any term of the SOP Agreement. (b) Absent the agreement of the Provider and the T&D to any proposed change, the standard of review for changes to any section of the SOP Agreement specifying the pricing or other material economic terms and conditions agreed to by the Provider and the T&D, whether proposed by a party, a non-party or FERC acting sua sponte, shall be the "public interest" standard of review set forth in United Gas Pipe Line Co. v. Mobile Gas Service Corp., 350 U.S. 332 (1956) and Federal Power Commission v. Sierra Pacific Power Co., 350 U.S. 348 (1956), ( the "Mobile-Sierra" doctrine). (c) To the extent a hearing, review or other proceeding is held before FERC, the "public interest" standard of review shall apply to any proposed changes in any other documents, instruments or other agreements executed or entered into by the parties in connection with the SOP Agreement, including any credit, security, margin, guaranty or other similar arrangement, and the Provider and the T&D expressly and irrevocably waive any rights they can or may have to the application of any other standard of review, including the "just and reasonable" standard. (d) Notwithstanding the foregoing paragraphs (b) and (c), to the fullest extent permitted by applicable law, each of the Provider and the T&D, for itself and its successors and assigns, expressly and irrevocably waives any rights it can or may have, now or in the future, whether under Sections 205 and/or 206 of the Federal Power Act or otherwise, to seek to obtain from FERC, or to support another in obtaining, by any means, directly or indirectly (through complaint, investigation or otherwise), and each hereby covenants and agrees not at any time to seek to so obtain, or support another in obtaining, an order from FERC changing any section of the SOP Agreement specifying the pricing, charges, classifications or other economic terms and conditions agreed to by the parties. It is the express intent of the parties that, to the fullest extent permitted by applicable law, the "sanctity of contract" principles acknowledged by FERC in its Notice of Proposed Policy Statement (Issued August 1, 2002) (NPPS) in Docket No. PL02-7-000, Standard of Review for Proposed Changes to Market-Based Rate Contracts for Wholesale Sales of Electric Energy by Public Utilities, shall prevail, and neither the Provider nor the T&D shall unilaterally seek to obtain from FERC any relief changing the rate, charge, classification, or other term or condition of the SOP Agreement, notwithstanding any changes in applicable law or markets that may occur. In the event it were to be finally determined that applicable law precludes one or both parties from waiving its rights to seek changes from FERC to its market-based power sales contracts (including entering into covenants not to do so) then this paragraph shall not apply, provided that, consistent with paragraph (a) above, neither party shall seek any such changes except under the "public interest" standard of review and otherwise as set forth in paragraph (a) above. (e) Nothing in these Bidder Conditions indicates the intention of the Provider or the Commission to submit the Standard Offer Obligation to the jurisdiction of FERC or indicates an acknowledgement that FERC has jurisdiction. Termination by Provider. In the event of a default on the part of the T&D which results in termination of the SOP Agreement, or an unlawful or arbitrary action by the fb88 legislature or the Commission or other action by the Commission (other than as a result of a Provider Default) as a result of which Provider ceases to receive payment for standard offer service at the rate and upon the terms specified herein or Provider is removed as the standard offer provider or ceases to retain the right to provide standard offer service for the entire term specified herein, Provider shall have the right (among other remedies) to terminate its obligation to provide standard offer service, the exercise of which shall terminate all of Providers SOP Obligations. The parties payment of termination damages in the event of such a termination shall be calculated and recovered pursuant to the relevant liquidation provisions of the SOP Agreement. Termination by Commission. The unexcused occurrence of either of the following events shall constitute a Provider Default: (i) Provider fails to satisfy its Load Asset obligations for the applicable Load Assets in the ISO-NE market settlement system (or its equivalent obligations in any successor market settlement system), as a result of which the T&D or other third party is obligated to assume responsibility for all such market settlement obligations; or (ii) Provider fails to perform any other of its material obligations under the Standard Offer Obligation in accordance with the requirements thereof, and the Commission, after notice and opportunity to be heard, finds that the failure justifies removal of Provider as the standard offer provider, and all Providers SOP Obligations shall terminate. In the event of a Provider Default, the T&D (subject to the Commissions approval) shall have the right (among other remedies) to terminate its obligation to accept standard offer service, the exercise of which shall terminate all of the T&Ds obligations under the SOP Agreement. The parties payment of termination damages in the event of such a termination shall be calculated and recovered pursuant to the relevant liquidation provisions of the SOP Agreement. Notwithstanding any provision to the contrary in the Standard Offer Obligation, the Commission shall not, nor shall it permit the T&D to, take any remedial action against the Provider or the Provider Guarantor (as such term is defined in the SOP Agreement) as a result of a failure or default of Provider (including action(s) described in Section 6.2 of the RFP and Section 9 of Chapter 301) unless such event constitutes a Provider Default. Security: The Commission shall find that the form of guaranty delivered to the Commission with the Bid Price Proposal satisfies Providers initial financial capability requirements. Further, if Provider is required to provide a letter of credit under the terms of the SOP Agreement, such letter of credit shall be issued by a commercial bank with a minimum long-term unsecured debt rating of A by Standard & Poors or A2 by Moodys.  Except for opt-out fee waivers granted by the Commission pursuant to its January 24, 2001 "Order Adopting Rule and Statement of Factual and Policy Basis" (Docket No. 2000-904).      034dfxRtZafg5]1g\]t[[r, - """"""$5$B$D$&ž̶ԫhGCJaJhLCJaJhL5CJ\aJhLCJ\aJhL>*CJ\aJhjhj6 hjCJh h0CJhhjh0 hLaJjhL0JUh hbM hL>*hL hiuk5 hL54 4defxyA B QR4556 ^` & F h88^8`` & F h88^8`$a$$a$$a$gdiuk[>??6- . 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