CLAUSES FROM INTERTIE PARTICIPANTS AGREEMENT CONTROLLING SCHEDULE AND OPT-IN, OPT-OUT DECISION FOR THE SOUTHERN INTERTIE

NOTE: As of 12/4/02 the "decision date" has not been set. Chugach apparently will try to get the Intertie Participants Group (IPG) to do this at the 12/16/02 meeting.

(3) Limited automatic rights of withdrawal.
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(B) Timing. A Participant that withdraws from participation in either Segment may do so only by delivering written notice to the other Participants on or before a particular date (hereinafter the "decision date") reasonably established by the IPG. The decision date shall be a date certain, after completion of the requisite Anchorage-Kenai Peninsula Segment route studies and cost estimates, on which a final decision will be made to proceed or not to proceed with construction of that Segment along a particular route and with particular end points. The Participants will cooperate with one another in good faith to help devise and implement such additional procedures, including reasonable meeting and notification schedules, as the IPG may adopt to facilitate decisionmaking on the potential transfers and assumptions of rights and obligations among Participants that may occur pursuant to this Section 4(b)(3).

(C) Effect of withdrawal on Participant Shares and related obligations. The Participant's Share of any withdrawing Participant shall be reallocated among other Participants in accordance with paragraph (D) below. ... The withdrawal of any Participant from the Anchorage-Kenai Peninsula Segment shall become effective sixty (60) days after the decision date, subject to the last sentence of Section 4(b)(3)(D)(ii).

(D) Reallocation of the Participant's Share of a withdrawing Participant.
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(ii) Anchorage-Kenai Peninsula Segment. The Participant's Share of a Participant that withdraws from the Anchorage-Kenai Peninsula Segment shall first be offered to all remaining Participants in that Segment, in proportion to their respective Shares in that Segment. Any portion of the withdrawing Participant's Share that remains available after this first round offer shall next be offered to all Participants in that Segment that have committed to withdraw from the Healy-Fairbanks Segment ("South-only Participants"). If and to the extent that the South-only Participants decline to accept this second-round offer, then the withdrawing Participant's Share (or any remaining portion thereof) shall again be offered to all remaining Participants in that Segment (including the South-only Participants) in proportion to the respective Participant's Shares of such Participants in that Segment. Each such Participant shall either accept such third-round offer, obtain agreement from another Participant to accept such third-round offer, or shall itself withdraw from participation in that Segment. In the event this process leads one or more additional Participants to withdraw from participation in that Segment, then their Participant's Shares shall be offered to the remaining Participants in a like first-round, second-round, and third-round manner. If, at the conclusion of this process, one or more Participants have accepted Participant's Shares in the Anchorage-Kenai Peninsula Segment that total one hundred percent (100%), then construction of the Segment shall commence and there shall be no further automatic rights of withdrawal available to any Participant; otherwise this Project Segment shall be considered Abandoned and all Participants in it (notwithstanding the attempted withdrawal of any of them under this paragraph) shall proceed, in accordance with procedures the IPG shall adopt, to wind up this Project Segment. No Participant shall in that event be excused from its Participant's Share of any obligations associated with this Project Segment until all such obligations have been satisfied.

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(F) In the event a Participant exercises the limited right of withdrawal pursuant to Section 4(b)(3), then each remaining Participant shall continue to be a Member with a single vote, notwithstanding its assumption of the transferring Participant's Share, but the Share of said remaining Participant shall be increased by the amount transferred for all other purposes, including for purposes of determining the affirmative vote of Members whose percentage Shares exceed 50% under Section 6(e)(3)(a).

(4) Default and Step-up. If, by reason of a Participant's default or otherwise by operation of law (including by order of any regulatory body with jurisdiction), a Participant's Share is reduced or eliminated, or a Participant ceases to be a Participant and ceases to pay the costs associated with its Participant's Share, in the Anchorage-Kenai Peninsula segment, then the Shares of the remaining Participants shall be proportionately increased so that the total of all Shares continues to equal 100%. No Party shall initiate or otherwise seek such an order reducing or eliminating its Share or terminating its role as a Participant.

(5) Voluntary Transfers. In the event that a Participant transfers or assigns its Share or portion thereof to another Party, the Share of the transferee shall be increased...