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NEW MEMBER AGREEMENT <br /> between <br /> THE CITY OF ELK RIVER <br /> and <br /> MINNESOTA MUNICIPAL POWER AGENCY <br /> This Agreement is hereby entered into as of the l— day of 2013 by and between <br /> the City of Elk River, Minnesota by its Utilities Commission ("City"), and the Minnesota <br /> Municipal Power Agency ("MMPA"). <br /> WHEREAS, the City of Elk River and MMPA (the "Parties") have held discussions <br /> relating to the application of the City to become a member of MMPA; and <br /> WHEREAS, the City and MMPA desire to have the City of Elk River admitted as a <br /> member of MMPA and the City will approve the MMPA Agency Agreement of May 11, 1992 as <br /> since amended(the "Agency Agreement"): <br /> NOW, THEREFORE, the City and MMPA agree as follows: <br /> 1. Execution of Power Sales Agreement. Prior to the admission of the City as a <br /> member of MMPA,the Parties will execute a Power Sales Agreement ("PSA") <br /> under which the City will purchase electric power and energy from MMPA from <br /> and after October 1, 2018. The execution by the parties of the PSA shall be <br /> performed and be effective on the same date as this Agreement. <br /> 2. Buy In. The City agrees to pay a buy in equal to 120% of its proportionate share <br /> of the net position (equity) and rate-related accruals of MMPA (the "Buy In") as <br /> of the date it begins purchasing electric power and energy from MMPA (the <br /> "Start Date"). The Buy In will be calculated through the following formula: <br /> [(City Wholesale Energy Purchases)/(MMPA Wholesale Energy Sales to <br /> Members) * (Total MMPA Net Position + Rate Stabilization Fund Balance+ <br /> Accrued Major Maintenance + Accrued Energy Adjustment Clause—Future <br /> Recoverable Costs (Deferred Costs))] * 1.2 <br /> The energy purchases and sales used in the above calculation will be calculated as <br /> the sum of the most recent twelve (12) months for which data is available for both <br /> parties at the time the calculation is made. The MMPA financial amounts shall be <br /> calculated as of the Start Date. The City may pay the Buy In prior to the Start <br /> Date based on estimates, with a true-up calculation performed as of the Start Date. <br /> The Buy In must be paid in full prior to the Start Date. However, if such payment <br /> would cause the City's electric rates to be uncompetitive, MMPA and the City <br /> agree to negotiate in good faith an alternative payment schedule. <br />