Common use of REGIONAL HEARING OF COMPLIANCE MATTERS Clause in Contracts

REGIONAL HEARING OF COMPLIANCE MATTERS. SERC Reliability Corporation shall es tablish and maintain a hearing body with authority to conduct and render decisions in compliance hearings in which a Registered Entity may contest a f inding of alleged violation, proposed pen alty or sanction, or a propos ed mitigation plan, which s hall be a balanced complianc e panel reporting directly to SERC Reliability Corporation’s board. SERC Reliability Corporation’s Hearing Body is the Board Compliance Committee, or a subset of the Board Compliance Committee. The Board Compliance Committee is comprised of SERC board members appointed by the Board of Directors. The Board Compliance Committee representation is as follows: • The Investor-Owned Utility Sector shall have three (3) representatives; • The Federal/State Sector shall have two (2) representatives; • The Cooperative Sector shall have two (2) representatives; • The Municipal Sector shall have two (2) representatives; • The Marketer Sector shall have on (1) representative; • The Merchant Electricity Sector shall have one (1) representative; • The ISO-RTO/Customer Sector shall have one (1) representative Consistent with the Hearing Procedures, a quorum for the purpose of constituting a Hearing Body shall be half of SERC’ s Board Complianc e Committee, or six members including alternates . In addition to the quorum requirement, the chair of the Board Compliance Committee sha ll declare the Hea ring Body duly constituted only if no two sectors can control and no one s ector can veto the actions of the Hearing Body (the “Sector Control Requirements”). To ensure that the Sector Control Requirements are met in the formati on of a Hearing Body, the Chair shall adhere to the following in declaring the Hearing Body duly constituted: • If the Hearing Body is made up of six (6) members of the BCC, then each sector shall have no more than one (1) representative on the Hearing Body. • If the Hearing Body is made up of seven (7) or eight (8) members of the BCC, then only one sector can have two (2) representatives on the Hearing Body, and each other sector can have only one (1) representative on the Hearing Body. • If the Hearing Body is made up of nine (9) or ten (10) members of the BCC, then no sector can have more than two (2) representatives on the Hearing Body. • If the Hearing Body is made up of eleven (11) or twelve (12) members of the BCC, then the Sector Control Requirements are met, as no two sectors would have enough votes to control, and no one sector would have the ability to veto. Approval of all actions before a duly constituted Hearing Body shall require a simple majority of the votes cast, with each member of the Hearing Body having one vote. The decision of any duly constituted Hearing Body pursuant to these requirements shall be final and binding on the Corporation, without requiring either the full Compliance Committee or the Corporation to ratify the Hearing Body’s actions.

REGIONAL HEARING OF COMPLIANCE MATTERS. SERC Reliability Corporation SERC, to the extent required in the Rules of Procedure, shall es tablish establish and maintain a hearing body with authority to conduct and render decisions in compliance hearings in which a Registered Entity may contest a f inding finding of alleged violation, proposed pen alty penalty or sanction, or a propos ed proposed mitigation plan, which s hall shall be a balanced complianc e compliance panel reporting directly to SERC Reliability CorporationSERC’s board. SERC Reliability CorporationSERC’s Hearing Body is the Board Compliance Committee, or a subset of the Board Compliance Committee. The Board Compliance Committee is comprised of SERC board members appointed by the Board of Directors. The Board Compliance Committee representation is as follows: •  The Investor-Owned Utility Sector shall have three (3) representatives; •  The Federal/State Sector shall have two (2) representatives; •  The Cooperative Sector shall have two (2) representatives; •  The Municipal Sector shall have two (2) representatives; •  The Marketer Sector shall have on (1) representative; •  The Merchant Electricity Sector shall have one (1) representative; •  The ISO-RTO/Customer RTO Sector shall have one (1) representative Consistent with the Hearing Procedures, a quorum for the purpose of constituting a Hearing Body shall be half of SERC’ s ’s Board Complianc e Compliance Committee, or six members including alternates alternates. In addition to the quorum requirement, the chair of the Board Compliance Committee sha ll shall declare the Hea ring Hearing Body duly constituted only if no two sectors can control and no one s ector sector can veto the actions of the Hearing Body (the “Sector Control Requirements”). To ensure that the Sector Control Requirements are met in the formati on formation of a Hearing Body, the Chair shall adhere to the following in declaring the Hearing Body duly constituted: •  If the Hearing Body is made up of six (6) members of the BCC, then each sector shall have no more than one (1) representative on the Hearing Body. •  If the Hearing Body is made up of seven (7) or eight (8) members of the BCC, then only one sector can have two (2) representatives on the Hearing Body, and each other sector can have only one (1) representative on the Hearing Body. •  If the Hearing Body is made up of nine (9) or ten (10) members of the BCC, then no sector can have more than two (2) representatives on the Hearing Body. •  If the Hearing Body is made up of eleven (11) or twelve (12) members of the BCC, then the Sector Control Requirements are met, as no two sectors would have enough votes to control, and no one sector would have the ability to veto. Approval of all actions before a duly constituted Hearing Body shall require a simple majority of the votes cast, with each member of the Hearing Body having one vote. The decision of any duly constituted Hearing Body pursuant to these requirements shall be final and binding on the Corporation, without requiring either the full Compliance Committee or the Corporation to ratify the Hearing Body’s actions. To the extent required in the Rules of Procedure, SERC shall conduct all compliance hearings in which a Registered Entity may contest a finding of alleged violation, proposed penalty or sanction, proposed Mitigation Plan, or a proposed Remedial Action Directive, in accordance with Attachment 2, Hearing Procedures, to the NERC Compliance Monitoring and Enforcement Program, subject to the following deviations, if any: None.

REGIONAL HEARING OF COMPLIANCE MATTERS. SERC Reliability Corporation FRCC shall es tablish establish and maintain a hearing body with authority to conduct and render decisions in compliance hearings in which a Registered Entity may contest a f inding finding of alleged violation, proposed pen alty penalty or sanction, or a propos ed proposed mitigation plan, which s hall shall be the FRCC Board Compliance Committee (BCC), a balanced complianc e compliance panel reporting directly to SERC Reliability Corporationthe FRCC’s boardBoard of Directors. SERC Reliability Corporation’s Hearing Body is the Board Compliance Committee, or The BCC will consist of one (1) representative of a subset Voting Member from each of the Board Compliance Committee. The Board Compliance Committee is comprised six (6) sectors in the FRCC, who shall be a member of SERC board members appointed by the Board of Directors. The Board Compliance Committee representation is as follows: • The Investor-Owned Utility Sector shall have three (3) representatives; • The Federal/State Sector shall have Each year, two (2) representatives; • Directors (including Alternate Directors) from each Sector, will volunteer to serve in a BCC pool. At the time a hearing request is received, the Chair of the FRCC Board of Directors will appoint one member from each Sector to form the BCC for that hearing. Once appointed to a hearing, a Director or Alternate Director shall serve throughout the hearing’s duration. The Cooperative Sector shall have two (2) representatives; • The Municipal Sector shall have two (2) representatives; • The Marketer Sector shall have on (1) representative; • The Merchant Electricity Sector shall have Board Member from the Registered Entity that has requested the hearing will not be selected for that BCC. In the event one (1) representative; • The ISO-RTO/Customer Sector of the FRCC declines to participate on the BCC, the Chair of the Board of Directors shall have randomly select one (1) representative Consistent with additional BCC member from the Hearing Procedures, a quorum for remaining five (5) Sectors to constitute the purpose of constituting a Hearing Body shall be half of SERC’ s Board Complianc e Committee, or six members including alternates BCC. In addition to the quorum requirement, the chair The Chair of the FRCC Board Compliance Committee sha ll declare the Hea ring Body duly constituted only if no two sectors can control of Directors will appoint a Chair and no one s ector can veto the actions of the Hearing Body (the “Sector Control Requirements”). To ensure that the Sector Control Requirements are met in the formati on of a Hearing Body, the Vice-Chair shall adhere to the following in declaring the Hearing Body duly constituted: • If the Hearing Body is made up of six (6) members of the BCC, then each sector shall have no more than one . Terms of BCC members will be equivalent to the time it takes to complete the hearing for which they were selected. Members may be re- appointed to subsequent terms without any limits to the number of terms they serve. FRCC Industry Sectors are as follows:  One (1) representative on Member from the Hearing Body. • If the Hearing Body is made up of seven (7) or eight (8) members of the BCC, then only one sector can have two (2) representatives on the Hearing Body, and each other sector can have only one Investor Owned Utility Sector  One (1) representative on Member from the Hearing Body. • If Suppliers Sector  One (1) Member from the Hearing Body is made up of nine (9) or ten (10) members of the BCC, then no sector can have more than two (2) representatives on the Hearing Body. • If the Hearing Body is made up of eleven (11) or twelve (12) members of the BCC, then the Sector Control Requirements are met, as no two sectors would have enough votes to control, and no one sector would have the ability to veto. Approval of all actions before a duly constituted Hearing Body shall require a simple majority of the votes cast, with each member of the Hearing Body having one vote. The decision of any duly constituted Hearing Body pursuant to these requirements shall be final and binding on the Corporation, without requiring either the full Compliance Committee or the Corporation to ratify the Hearing Body’s actions.Non-Investor Owned Utility Wholesale Sector