Document:

ex10-1.htm

    

     

    Exhibit
10.1

     

    BEFORE
THE PUBLIC SERVICE COMMISSION

     

    OF
THE STATE OF MISSOURI

     

    

      
        	
                In
      the Matter of the Application of Kansas City

                Power
      & Light Company for Approval to Make

                Certain
      Changes in its Charges for Electric

                Service
      to Continue the Implementation of its

                Regulatory
      Plan

              	
                )

                )

                )           Case
      No. ER-2008-0089

                )

                )

              
	 
      	 
      

      

    NON-UNANIMOUS STIPULATION
AND AGREEMENT

     

    COME NOW
Kansas City Power & Light Company (“KCP&L” or “Company”), the Staff of
the Missouri Public Service Commission (“Staff”), the Office of the Public
Counsel (“OPC”), Praxair, Inc. and Midwest Energy Users Association (“Industrial
Intervenors”), U.S. Department of Energy, and the U.S. Nuclear Security
Administration, on the behalf of themselves and all other affected Federal
Executive Agencies (“DOE/NNSA”), Ford Motor Company, Missouri Industrial Energy
Consumers (“MIEC”), and Missouri Department of Natural Resources (“MDNR”) and
state the following for this Non-unanimous Stipulation and Agreement (“2009
Stipulation”) to resolve all issues in this case. For ease of reference, the
term “Signatory Party” or “Signatory Parties” refers to a party that has signed
this 2009 Stipulation or all of the parties that have signed this 2009
Stipulation, respectively. The term “Non-Utility Signatory” or “Non-Utility
Signatories” refers to a party other than KCP&L that has signed this 2009
Stipulation or all of the parties other than KCP&L that have signed this
2009 Stipulation, respectively.

     

    1.    Revenue
Requirement

     

    KCP&L
shall be authorized to file revised tariff sheets containing rate schedules for
electric service designed to produce an increase in overall Missouri
jurisdictional

    
      

    

    gross
annual electric revenues, exclusive of any applicable license, occupation,
franchise, gross receipts taxes or other similar fees or taxes, of $95.0
million, effective for electric service rendered on and after September 1, 2009,
provided however, that the Iatan 1 Air Quality Control System (“AQCS”)
facilities meet the Staff’s in-service criteria which are attached to the Direct
Testimony of Brent Davis as Schedule BCD-2 by May 30, 2009. $10.0 million of the
$95 million rate increase shall be comprised of “Additional Amortizations to
Maintain Financial Ratios” (“Additional Amortizations”), as that term is defined
in the Stipulation And Agreement reached in the Company’s proceeding to approve
its Experimental Regulatory
Plan, Case No. EO-2005-0329, as approved by the Commission (“2005
Stipulation”). Exemplar revised tariff sheets designed to implement this 2009
Stipulation are attached as Schedule 1 (to be late-filed). The rates reflected
in Schedule 1 have been calculated based on the billing determinants developed
by Staff in this proceeding. Subject to the provisions herein, the stipulated
rate increase resolves all revenue requirement issues in this case.

     

    2.    Rate
Design

     

    The
Signatory Parties agree that the rate design shall be on an equal percentage,
across-the-board basis for each rate class. Within the Large Power Service
(“LPS”) class, however, no change will be made to the tail block energy charge
and, instead, the entirety of the rate increase shall be spread on an equal
percent across the board basis between the first two energy blocks, and all
demand and service charges, as contained in the exemplar revised tariff sheets
contained in Schedule 1. The rates for separately metered space heating and the
winter energy rate blocks on the all-electric rates for the general service
classes shall be increased by an additional five (5%) percentage points above
the equal

    
2

    
      
        

      

    percentage
increase. The Signatory Parties agree that the date for the determination of the
interest rate to be paid on deposits should be changed to the first business day
of December of the preceding calendar year rather than the last business day of
the preceding calendar year.

     

    3.            Customer Class Cost of
Service Study

     

    KCP&L
agrees to file a Customer Class Cost of Service Study case with the Commission
by December 31, 2009.

     

    4.            Vegetation Management and
Infrastructure Inspection

     

    The
Signatory Parties agree that there shall be no tracker for vegetation management
or infrastructure inspection activities as a result of this instant proceeding,
but that KCP&L shall create sub-accounts for each where the costs for these
activities shall be booked for KCP&L. KCP&L shall submit quarterly
reports detailing the vegetation management activities and expenses in the
KCP&L Missouri jurisdictional service territory to the Commission’s Energy
Department. KCP&L agrees to maintain records to separately identify the
costs to implement the Commission’s new Vegetation Management regulations
between Missouri and Kansas using Federal Energy Regulatory Commission accounts
593000 (distribution) and 571005-571006 (transmission), department 252.
KCP&L states that it is in the process of setting up appropriate accounts to
track infrastructure and reliability reporting costs.

     

    5.    Prudence and In-Service
Timing of Iatan 1

     

    No
Signatory Party to this 2009 Stipulation shall argue that anyone is prohibited
from arguing or presenting evidence in the next KCP&L general rate case
challenging the prudence of any Iatan 1 construction cost or that KCP&L
should have had this unit

    
3

    
      
        

      

    operating
at full generation capacity sooner than the actual date that Iatan 1 is found to
be fully operational and used for service, provided however, that any proposed
disallowance of rate base for imprudence under this paragraph shall be limited
to a maximum amount of Missouri jurisdictional rate base no greater than $30
million inclusive of Iatan common costs. KCP&L represents that Iatan 1 and
Iatan common costs will not exceed $733 million on a total project basis. Should
the Commission find that KCP&L, respecting any Non-Utility Signatory’s
construction audit of these costs, (a) failed to provide material and relevant
information which was in KCP&L’s control, custody, or possession, or which
should have been available to KCP&L through reasonable investigation, (b)
misrepresented facts relevant to charges to Iatan 1 or Iatan common costs, or
(c) engaged in the obstruction of lawful discovery, said Non-Utility Signatory
is not bound to proposing a disallowance to KCP&L’s Missouri jurisdictional
rate base no greater than $30 million inclusive of Iatan common costs in
aggregate amount with regard to such construction audit. KCP&L shall
maintain Caseworks for the use of the Non-Utility Signatories. The Non-Utility
Signatories may continue their construction audits of Iatan 1 and Iatan 2 prior
to KCP&L filing its Iatan 2 rate case. KCP&L will facilitate the
resolution of all outstanding discovery disputes with the Non-Utility
Signatories and cooperate with them in any construction audits of Iatan 1 and
Iatan 2. KCP&L shall have the right to object, or to continue to object, to
discovery of the Non-Utility Signatories under applicable law or Commission
rule. KCP&L and the other Non-Utility Signatories will seek the timely
resolution of discovery disputes. KCP&L will provide DOE/NNSA the Iatan
portion of all reports provided to the Signatory Parties to the 2005
Stipulation.

    
 

     4

      
        

      

    

    
 

    6.    Allocations of Common Plant
for Iatan 1 and 2

     

    (a)            The
Non-Utility Signatories agree that the Company can record as a regulatory asset
the depreciation and carrying costs associated with the Iatan 1 AQCS plant and
identified Iatan common facilities costs appropriately recorded to Electric
Plant in Service that are not included in rate base in the current rate case.
Depreciation and carrying costs will continue to be deferred to the regulatory
asset until the date new rates become effective resulting from the Company’s
next general rate case. Amortization of the accumulated deferred costs will
begin at that time based on the depreciable life of the Iatan 1 AQCS
plant.

     

    (b)            The
determination of the value of the owners of Iatan 1 due from other owners of
Iatan 2 joining as additional owners of common plant already paid for by the
Iatan 1 owners has not been calculated.

     

    (c)    If Staff’s
in-service criteria are met by May 30, 2009, the Signatory Parties agree to
“construction accounting” for remaining Iatan 1 prudent costs incurred post
true-up cut-off as “construction accounting” is defined in the 2005 Stipulation
at page 43, Section III.3.d.vii., subject to the agreement of the Signatory
Parties of the amount to include in rates in this case and the agreement of the
Signatory Parties of the date by which invoices are timely booked or approved
for payment. Any deferred depreciation expense and carrying costs will be offset
by accumulated deferred income taxes on this plant. The deferred depreciation
expense will be charged to the depreciation reserve as required by normal
accounting. The deferred expenses will receive rate base treatment, and
consistent with the Commission treatment of these type of deferrals, the
deferred income taxes will be included in rate base. KCP&L agrees to
calculate the amount due

    
5

    
      
        

      

    from the
other Iatan 2 owners and reflect that amount as an offset to the common plant
costs. The carrying costs will be calculated at the rate used for Iatan
2.

     

    7.            Additional Amortizations To
Maintain Financial Ratios

     

    The total
Additional Amortization that will be reflected in rates beginning with the
billing month beginning September 1, 2009 as a result of this 2009 Stipulation
and the Commission determinations in Case Nos. ER-2006-0314 and ER-2007-0291
shall be $42,402,888. The Additional Amortization amount due to the settlement
of the instant Case No. ER-2009-0089 shall be the last Additional Amortization
under the 2005 Stipulation.

     

    8.            AFUDC
Rate

     

    For
purposes of determining the Allowance for Funds Used During Construction
(“AFUDC”) rate for Iatan 2 and the carrying cost rate for any Accounting
Authority Order established from this case for Iatan 1, the AFUDC equity rate
will be the lower of 8.25% or 250 basis points less than the return on equity
ordered in the pending KCP&L Greater Missouri Operations Company rate case,
Case No. ER-2009-0090.

     

    9.    Surveillance
Reporting

     

    For
surveillance reporting purposes, until changed by agreement of the Signatory
Parties, the following jurisdictional allocations shall be used:

     

    (a)            All
environmental-related production assets shall be allocated with the same
allocator used for the production facility where those environmental-related
production assets are installed, for the life of those environmental-related
production assets;

     

    (b)            Off-System
Sales margins shall be allocated using the energy allocator;

    
 

     6

      
        

      

    

    
 

    (c)            All
non-fuel production and transmission operations and maintenance (“O & M”)
shall be allocated using the 4 CP demand allocator (June, July, August and
September); and

     

    (d)            Transmission
and production facilities shall be allocated using the 4 CP demand allocator
(June, July, August and September).

     

    10.             Economic Relief Pilot
Program (“ERPP”)

     

    The
Non-Utility Signatories agree that the Company can defer 50% of the ERPP costs
in a regulatory asset until the next KCP&L rate case, with cost recovery to
be determined at that time. The remaining 50% of such cost will be borne by the
Company’s shareholders. The Company agrees to address all concerns raised by
Staff in rebuttal testimony, specifically related to the language regarding
discontinuation of customer participation, and the language regarding
reinstatement of former participants, as contained in Attachment Schedule ADD-2
to Company witness Allen Dennis’s Surrebuttal Testimony. The Signatory Parties
agree that this program should be implemented, but that it should not be
considered a demand side management program.

     

    11.            Wolf Creek Refueling
Cost

     

    The
Signatory Parties agree that $1,570,581 (Missouri jurisdictional) of Outage #16
O & M refueling costs will be deferred in a regulatory asset account and
amortized over five years beginning with the date new rates become effective in
this case, with one-fifth of this cost included in cost of service in this case.
The unamortized balance will not be included in rate base.

    
 

     7

      
        

      

    

    
 

    
      	
               
      

            	
              12.

            	
              Surface Transportation
      Board (“STB”) Litigation

            

    

     

    The
Signatory Parties agree that the Missouri jurisdictional excess of STB
litigation proceeds over un-recovered STB litigation costs of $1,017,593 will be
deferred in a regulatory liability account and amortized over ten years
beginning with the date new rates become effective in this case, with one year’s
amortization included in cost of service in this case. The unamortized balance
will not be included in rate base.

     

    
      	
               
      

            	
              13.

            	
              Off-System Sales
      (“OSS”) Margins—Excess Over 25th Percentile for 2007 and
      2008

            

    

     

    The
Signatory Parties agree that the $1,082,974 (Missouri jurisdictional) excess of
2007 OSS margins over the amount included in rates in Case No. ER-2006-03 14 and
the $2,947,332 (Missouri jurisdictional) excess of 2008 OSS margins over the
amount included in rates in Case No. ER-2007-0291, together with interest
(Missouri jurisdictional), will be deferred in a regulatory liability account
and amortized over ten years beginning with the date new rates become effective
in this rate case, with one year’s amortization included in cost of service in
this case. The unamortized balance will not be included in rate
base.

     

    14.    Deferred DSM Advertising
Costs

     

    The
Signatory Parties agree that $279,521 (Missouri jurisdictional) of 2007
advertising costs will be deferred in a regulatory asset account and amortized
over ten years beginning with the date new rates become effective in this rate
case, with one-tenth of this cost included in cost of service in this case. The
unamortized balance will not be included in rate base as agreed to in the 2005
Stipulation.

    
 

     8

      
        

      

    

    
 

    15.            Off-System Sales
Tracker

     

    KCP&L’s
OSS margins at the 25th percentile shall be set at $30 million, and shall be
used for tracking purposes. Such tracker will reflect a pro-ration, on a monthly
basis, of this amount for any partial years consistent with the percent of
actual OSS realized in each month of 2008. All OSS margins will be tracked
against the $30 million baseline. The Signatory Parties reserve the right to
assert a position regarding the appropriate definition of OSS in the Company’s
next general rate case.

     

    16.            Rate Case
Expense

     

    The
Signatory Parties agree that any over-recovery of the amortization of the
Company’s rate case expense in Case No. ER-2006-03 14 will be used to offset the
deferral of rate case expense in this case.

     

    17.           Miscellaneous Costs Not
Included in Rates

     

    The
Signatory Parties agree that the following costs are not included in the rate
levels contained in this agreement: Sporting events, golf events, Worlds of Fun
tickets, dues and donations, lobbying, image or institutional advertising,
spousal travel, local meal expenses, officer expense reports, and catering
expense. The Signatory Parties reserve the right to seek inclusion or oppose
inclusion of these costs in a future rate case.

     

    18.            Demand-Side
Managment

     

    KCP&L
agrees in its next IRP filing to include at least one alternative resource plan
that demonstrates energy reductions from demand side resources of at least 1% of
the projected retail energy requirements per year over the 20-year planning
horizon, assuming a net-to-gross ratio of 1.0.

     

    19.    Supplemental Weatherization
and Minor Home Repair Program

    
 

     9

      
        

      

    

    
 

    KCP&L
agrees to present the Supplemental Weatherization and Minor Home Repair Program
to the customer program advisory group (“CPAG”) at the earliest opportunity.
KCP&L remains committed to the program but believes input from the CPAG
would be beneficial to the finalization and implementation of the
program.

     

    20.            Low Income/Weatherization
Issues

     

    KCP&L
agrees to take an active role in the coordination of the exchange of information
between the City of Kansas City, Missouri and the state agencies that administer
the LIHEAP programs to facilitate the referral of customers who might benefit
from the Company’s low-income weatherization program.

     

    21.            Pension
Agreements

     

    KCP&L
and Staff will file a separate Non-Unanimous Stipulation And Agreement Regarding
Pensions and OPEB’s in this proceeding.

     

     

    GENERAL  PROVISIONS OF
STIPULATION

     

    22.            The
Staff may file suggestions, a memorandum or other pleading in support of this
2009 Stipulation. KCP&L and any other Non-Utility Signatory shall have the
right to file responsive suggestions, memorandum or other pleading in response.
The contents of any such suggestions, memorandum or other pleading provided by
any Signatory Party will be its own.

     

    23.            This
2009 Stipulation is being entered into solely for the purpose of disposing of
Case No. ER-2009-0089. Except as expressly and specifically addressed otherwise
in this 2009 Stipulation, none of the Non-Utility Signatories to this 2009
Stipulation shall be deemed to have approved, accepted, agreed, consented, or
acquiesced in, including without limitation, any procedural principle, question
of Commission

    
 

     10

      
        

      

    

    
 

    authority,
accounting authority order principle, cost of capital principle or methodology,
capital structure principle or methodology, decommissioning methodology,
ratemaking principle, valuation methodology, cost of service methodology or
determination, depreciation principle or method, rate design methodology, cost
allocation principle or methodology, cost recovery principle or methodology, or
prudence question that may underlie this 2009 Stipulation, or for which
provision is made in this 2009 Stipulation.

     

    24.            This
2009 Stipulation represents a negotiated settlement. Except as specified herein,
the Signatory Parties to this 2009 Stipulation shall not be prejudiced, bound
by, or in any way affected by the terms of this 2009 Stipulation: (a) in any
future proceeding; (b) in any proceeding currently pending under a separate
docket; and/or (c) in this proceeding should the Commission decide not to
approve this 2009 Stipulation, or in any way condition its approval of
same.

     

    25.            The
provisions of this 2009 Stipulation have resulted from extensive negotiations
between the Signatory Parties and are interdependent. In the event that the
Commission does not approve and adopt the terms of this 2009 Stipulation in
total, it shall be void and none of the Signatory Parties shall be bound,
prejudiced, or in any way affected by any of the agreements or provisions
hereof, unless otherwise agreed to by the Signatory Parties.

     

    26. If approved and adopted by
the Commission, this 2009 Stipulation shall constitute a binding agreement among
the Signatory Parties. The Signatory Parties shall cooperate in defending the
validity and enforceability of this 2009 Stipulation and the operation of this
2009 Stipulation according to its terms.

    
 

     11

      
        

      

    

    
 

    27.            This
2009 Stipulation does not constitute a contract with the Commission. Acceptance
of this 2009 Stipulation by the Commission shall not be deemed as constituting
an agreement on the part of the Commission to forego the use of any discovery,
investigative or other power which the Commission presently has. Thus, nothing
in this 2009 Stipulation is intended to impinge or restrict in any manner the
exercise by the Commission of any statutory right, including the right to access
information, or any statutory obligation.

     

    28.            If
the Commission does not unconditionally approve this 2009 Stipulation without
modification, and notwithstanding its provision that it shall become void
thereon, neither this 2009 Stipulation, nor any matters associated with its
consideration by the Commission, shall be considered or argued to be a waiver of
the rights that any Signatory Party has to a hearing on the issues presented by
this 2009 Stipulation, for cross-examination, or for a decision in accordance
with Section 536.080 RSMo 2000 or Article V, Section 18 of the Missouri
Constitution, and the Signatory Parties shall retain all procedural and due
process rights as fully as though this 2009 Stipulation had not been presented
for approval, and any suggestions, memoranda, testimony or exhibits that have
been offered or received in support of this 2009 Stipulation shall thereupon
become privileged as reflecting the substantive content of settlement
discussions and shall be stricken from and not be considered as part of the
administrative or evidentiary record before the Commission for any further
purpose whatsoever, unless otherwise agreed to by the Signatory
Parties.

     

    29.            In
the event the Commission accepts the specific terms of this 2009 Stipulation,
the Signatory Parties waive their respective rights to
cross-examine

    
 

     12

      
        

      

    

    
 

    witnesses;
their respective rights to present oral argument and written briefs pursuant to
Section 53 6.080. 1 RSMo 2000; and their respective rights to judicial review
pursuant to Section 386.5 10 RSMo 2000. The Signatory Parties agree that the
pre-filed testimony and exhibits of the Signatory Parties shall be entered into
the record without the necessity of the witnesses taking the witness
stand.

     

    WHEREFORE, for the foregoing
reasons, the Signatory Parties respectfully request that the Commission issue an
Order approving the terms and conditions of this Stipulation and
Agreement.

    Respectfully
submitted,

     

    

    

    
      
        
          	
                  STAFF
      OF THE MISSOURI PUBLIC SERVICE COMMISSION

                  /s/
      Nathan Williams by JMF

                  Kevin
      A. Thompson, MBE #36288 General Counsel

                  Steven
      Dottheim, MBE #29 149

                  Chief
      Deputy General Counsel

                  Nathan
      Williams, MBE #355 12

                  Deputy
      General Counsel

                  Missouri
      Public Service Commission

                  P.O.
      Box 360

                  Jefferson
      City, MO 65102

                  (573)
      751-8702 (Voice - Williams)

                  (573)
      751-7489 (Voice - Dottheim)

                  (573)
      751-2690 (Voice - Thompson)

                  (573) 751-9285 (Fax)
      

                  nathan.williams@psc.mo.gov 

                  steve.dottheim@psc.mo.gov 

                  kevin.thompson@psc.mo.gov.

                	
                  KANSAS
      CITY POWER & LIGHT COMPANY

                  /s/
      William G. Riggins by JMF

                  William
      G. Riggins, MBE #42501

                  General
      Counsel

                  Curtis
      Blanc, MBN#5 8052

                  Managing
      Attorney - Regulatory

                  Kansas
      City Power & Light Company (816) 556-2785

                  (816)
      556-2787 (Fax)

                  bill.riggins@kcpl.com curtis.blanc@kcpl.com

                   

                  James
      M. Fischer, MBE #27543 Fischer & Dority, P.C.

                  101
      Madison Street, Suite 400 Jefferson City, MO 65101

                  (573)
      636-6758

                  (573)
      636-0383 (Fax)

                  jfischerpc@aol.com

                
	 
      	 
      
	 
      	
                  Karl
      Zobrist, MBN #28325

                  Roger
      W. Steiner, MBN #39586 Sonnenschein Nath & Rosenthal LLP 4520 Main
      Street, Suite 1100

                

        

      

    

     

    13

    
      
        

      

    

    
      
        
          	 
      	
                  Kansas
      City, MO 64111 (816) 460-2545

                  (816) 531-7545 (Fax) kzobrist@sonnenschein.com
      rsteiner@sonnenschein.com

                
	 
      	 
      
	
                  OFFICE
      OF THE PUBLIC COUNSEL

                   

                  /s/
      Lewis R. Mills, Jr. by JMF

                  Lewis
      R. Mills, Jr., MBE #35275 Public Counsel

                  P.O.
      Box 2230

                  Jefferson
      City, MO 65102 (573) 751-1304

                  (573)
      751-5562 (Fax) lewis.mills@ded.mo.gov

                   

                  PRAXAIR,
      INC. and MIDWEST ENERGY USERS ASSOCIATION

                   

                  /s/
      David L. Woodsmall by JMF

                  David
      L. Woodsmall, MBE #40747 Stuart W. Conrad, MBE # 23966 428 E. Capitol,
      Suite 300

                  Jefferson
      City, MO 65101

                  (573)
      635-2700

                  (573)
      635-6998 (Fax) dwoodsmall@fcplaw.com

                   

                  THE
      EMPIRE DISTRICT ELECTRIC COMPANY

                   

                  Diana
      C. Carter, MBE #50527

                  Brydon,
      Swearengen & England P.C. 312 E. Capitol Avenue

                  P.O.
      Box 456

                  Jefferson
      City, MO 65102

                  (573)
      635-7166

                   

                   

                  14

                	
                  MISSOURI
      DEPARTMENT OF NATURAL RESOURCES

                   

                  /s/
      Harry Bozoian by JMF

                  Harry
      Bozoian, MBE # 37535 Deputy General Counsel

                  P.O.
      Box 176

                  Jefferson
      City, MO 65102 (573) 751-0323

                  (573)
      526-3444 (Fax) harry.bozoian@dnr.mo.gov

                   

                  U.S.
      DEPARTMENT OF ENERGY, NATIONAL NUCLEAR SECURITY ADMINISTRATION and OTHER
      AFFECTED FEDERAL EXECUTIVE AGENCIES

                   

                  /s/
      Arthur Perry Bruder by JMF

                  Arthur
      Perry Bruder

                  U.S.
      Department of Energy 1000 Independence Ave. SW Washington, DC
      20585

                  (202)
      586-3409

                  (202)
      586-3409 (Fax) arthur.bruder@hq.doe.gov

                   

                  MISSOURI
      GAS ENERGY

                   

                  Diana
      C. Carter, MBE #50527

                  Brydon,
      Swearengen & England P.C. 312 E. Capitol Avenue

                  P.O.
      Box 456

                  Jefferson
      City, MO 65102

                  (573)
      635-7166

                   

                   

                
	
                   

                   

                  (573)
      634-7431 (Fax) dcarter@brydonlaw.com

                   

                  CITY
      OF KANSAS CITY, MISSOURI

                   

                  Mark
      W. Comley, MBE #28847 Newman, Comley & Ruth P.C.

                  601
      Monroe Street, Suite 301

                  P.O.
      Box 537

                  Jefferson
      City, MO 65 102-0537 (573) 634-2266

                  (573)
      636-3306 (Fax)

                   

                   

                   

                   

                   

                   

                  FORD
      MOTOR COMPANY and MISSOURI INDUSTRIAL ENERGY CONSUMERS

                   

                  /s/
      Diana M. Vuylsteke by JMF

                  Diana
      M. Vuylsteke, MBE #42419

                  Bryan
      Cave LLP

                  One
      Metropolitan Square, Suite 3600

                  St.
      Louis, MO 63102

                  (314)
      259-2543

                  (314)
      552-8543 (Fax) dmvuylsteke@bryancave.com

                   

                   

                   

                  UNION
      ELECTRIC CO., d/b/a AMERENUE

                	
                   

                   

                  (573)
      634-7431 (Fax) dcarter@brydonlaw.com

                   

                  MISSOURI
      JOINT MUNICIPAL ELECTRIC UTILITY COMMISSION

                   

                  Douglas
      Healey, MBE #5 1630 939 Boonville Suite A

                  Springfield,
      MO 65802

                  (417)
      864-8800

                  dhealy@mpua.org

                   

                  Duncan
      E. Kincheloe, MBE #

                  1808
      I-70 Dr. SW

                  Columbia,
      MO 65203

                  (573)
      445-3279

                  (753)
      445-0680 (Fax)

                  dkincheloe@mpua.org

                   

                  TRIGEN-KANSAS
      CITY ENERGY CORP.

                   

                  Jeffrey
      Keevil, MBE #33 825

                  Charles
      Brent Stewart, MBE #34885 Stewart & Keevil, LLC

                  4603
      John Garry Drive, Suite 11 Columbia, MO 65203

                  (573)
      499-0635

                  (573)
      499-0638 (Fax)

                  per594@aol.com

                  stewart499@aol.com

                   

                   

                   

                  HOSPITAL
      INTERVENORS

                
	 
      	 
      
	
                  James
      B. Lowery, MBE #40503 Smith Lewis, LLP

                  111
      South Ninth St., Suite 200

                	
                  James
      P. Zakoura

                  Smithyman
      & Zakoura, Chartered 750 Commerce Plaza
II

                

        

      

    

    

     

     15

      
        

      

    

    

    

    
      	
              P.O.
      Box 918

              Columbia
      MO 65205-0918

              (573)
      443-3141

              (573)
      442-6686 (Fax)

              lowery@smithlewis.com

            	
              7400
      W. 110th
      Street

              Overland
      Park KS 66210-2346

              (913)
      661-9800

              (913)
      66109863 (Fax)

              zakoura@smizak-law.com

            
	 
      	 
      

    

    

     

    CERTIFICATE OF
SERVICE

        

    I do
hereby certify that a true and correct copy of the foregoing document has been
hand delivered, emailed or mailed, postage prepaid, this 24th day of April,
2009, to all counsel of record.

     

                        /s/ James M.
Fischer

                        James M.
Fischer

     

     

    16EXHIBIT
10.1

    

    FORM
OF DIRECTORS’ OPTION AGREEMENT

     

    STOCK
OPTION AGREEMENT

    

    THIS
AGREEMENT, made this ____ day of _________200_, by and between SpectraScience,
Inc., a Minnesota corporation (the "Company”) and _________
("Optionee").

    

    1.           Grant of
Option.

    

    Pursuant
to its Amended 2001 Stock Option Plan (the "Plan), the Company hereby grants to
Optionee, on the date set forth above, the right and option (hereinafter called
the "option”) to purchase all or any part of an aggregate of _______________
(________) shares of Common Stock par value $0.01 per share (the "Shares"), on
the terms and conditions set forth herein. This option is not intended to be an
incentive stock option within the meaning of Section 422 of the Internal Revenue
Code of 1986, as amended (the "Code"). All capitalized terms not defined herein
are defined in the Plan.

    

    2.           Duration and
Exercisability.

    

    (a) This
option shall be exercisable on and after the dates set forth below for the
number of Shares indicated.

    

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              	
                                                      Exercise Period

                                                    	 	
                                                      No. Of Shares

                                                      (Cumulative)

                                                    	 	
                                                      Price/Share

                                                    	 
	 
      	 	 
      	 	 	 
	
                                                       

                                                    	 	
                                                       

                                                    	 	$	 	 
	
                                                       

                                                    	 	
                                                       

                                                    	 	$	 	 
	
                                                       

                                                    	 	
                                                       

                                                    	 	$	 	  

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    

    
      	
               
      

            	
              (b)

            	
              This
      Option shall in all events terminate on _________,
  201_.

            

    

    

    (c)
During the lifetime of Optionee, the option shall be exercisable only by
Optionee and shall not be assignable or transferable by Optionee other than by
will or the laws of descent and distribution.

    

    3.
           Manner of
Exercise.

     

    (a) The
option can be exercised only by Optionee or other proper party by delivering
within the option period written notice to the Company at its principal office.
The notice shall state the number of Shares as to which the option is being
exercised and be accompanied by payment in full of the option price for all
shares designated in the notice. The original Option Agreement and the number of
Shares issued to optionee shall be noted on the original certificate prior to
its return to Optionee.

    

    (b)
Optionee may pay the option price in cash by check (bank check, certified check
or personal check), or by money order or as otherwise provided in the
Plan.

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

    

    
      	
               
      

            	
              4.

            	
              Miscellaneous

            

    

    

    (a) This
option is issued pursuant to the Company's Amended 2001 Stock Option Plan and is
subject to its terms which are incorporated by reference herein. The terms of
the Plan are available for inspection during business hours at the principal
office of the Company.

    

    (b)
Optionee shall have none of the rights of a shareholder with respect to Shares
subject to this option until such Shares shall have been issued to Optionee upon
exercise of this option.

    

    (c) The
exercise of all or any parts of this option shall only be effective at such time
that the sale of Shares pursuant to such exercise will not violate any state or
federal securities laws.

    

    (d) If
there shall be any change in the Common Stock of the Company through merger,
consolidation, reorganization, recapitalization, dividend in the form of stock
(of whatever amount, stock split or other change in the corporate structure of
the Company and all or any portion of the option shall then be unexercised and
not yet expired, then equitable adjustments in the outstanding option shall be
made by the Company in order to prevent dilution or enlargement of option
rights. Such adjustments shall include, where appropriate changes in the number
of Shares and the price per share subject to the outstanding
option.

    

    (e) The
Company shall at all times during the term of the option reserve and keep
available such number of Shares as will be sufficient to satisfy the
requirements of this Agreement.

    

    (f)
Optionee agrees that if (i) the Company advises Optionee that it plans an
underwritten public offering of its Common Stock in compliance with the
Securities Act of 1933, as amended, and that the underwriters have requested
that certain shareholders including Optionee, refrain from selling, entering
into any contract to sell, or granting any option to buy or otherwise dispose of
part or all of their Common Stock or Common Stock purchase rights, then (ii) for
a period not to exceed 180 days from the prospectus, Optionee shall not sell or
contract to sell or grant an option to buy or otherwise dispose of this Option
or any of the underlying Shares without the prior written consent of the
underwriters. This section shall not prohibit any exercise of this
Option.

    

    (g)
Notwithstanding anything in this Agreement to the contrary, in the event the
Company makes any public offering of its securities and determines in its sole
discretion that it is necessary to reduce the number of issued but unexercised
stock purchase rights so as to comply with any state securities or Blue Sky law
limitations with respect thereto, the Board of Directors of the Company shall
have the right (i) to accelerate the exercisability of this Option and the date
on which this Option must be exercised, provided that the Company gives Optionee
15 days' prior written notice of such acceleration and (ii) to cancel any
portion of this Option or any other option granted to Optionee pursuant to this
Agreement which is not exercised prior to or contemporaneously with such public
offering. To the extent the Option is cancelled pursuant to this Section, the
Company will grant Optionee stock appreciation right or other equivalent
compensation which provides the same benefits as the Option so cancelled. Notice
shall be deemed given when delivered personally or when deposited in the United
States mail first class postage prepaid and addressed to Optionee at the address
of Optionee on file with the Company.

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    (h).
Optionee agrees that if Optionee is an "affiliate" of the Company or any
subsidiary (as defined in applicable legal and accounting principles) at the
time of any "change of control transaction," Optionee will comply with all
requirements of Rule 145 of the Securities Act of 1933, as amended, and the
requirements of other applicable legal or accounting principles, and will
execute any documents necessary to ensure such compliance. For purposes of this
Agreement, a "change of control transaction" means an acquisition of the Company
through the sale of substantially all of the Company's assets and the consequent
discontinuance of its business or through a merger, consolidation, exchange,
reorganization, reclassification, extraordinary dividend, divestiture or
liquidation of the Company.

    

    (i) The
certificates for any Shares purchased by Optionee (or, in the case of death,
Optionee's successors shall bear an appropriate legend to reflect the
restrictions imposed by this Agreement.

    

    (j) Any
dispute arising out of or relating to this Agreement or the alleged breach of
it, or the making of this Agreement, including claims of fraud and inducement,
shall be discussed between the disputing parties in a good faith effort to
arrive at a mutual settlement of any such controversy. If, notwithstanding, such
dispute cannot be resolved, such dispute shall be settled by binding
arbitration. Judgment upon the award rendered by the arbitrator may be entered
in any court having jurisdiction thereof.  The arbitrator shall be a
retired state or federal judge or an attorney who has practiced securities or
business litigation for at least ten (10) years. If the parties cannot agree on
an arbitrator within twenty (20) days, any party may request that the California
Bar Association recommend three arbitrators and the parties shall select one
such person at random (by drawing or other means). Arbitration will be conducted
pursuant to the provisions of this Agreement and the commercial arbitration
rules of the American Arbitration Association, unless such rules are
inconsistent with the provisions of this Agreement. Limited civil discovery
shall be permitted for the production of documents and taking of depositions.
Unresolved discovery disputes may be brought to the attention of the arbitrator
who may dispose of such disputes. The arbitrator shall have the authority to
award any remedy or relief that a court of this state could order or grant,
provided, however, that punitive or exemplary damages shall not be awarded. The
arbitrator may award to the prevailing party, if any, as determined by the
arbitrator, all of its costs and fees, including the arbitrator's fee,
administrative fees, travel expenses) out-of-pocket expenses and reasonable
attorney's fees. Unless otherwise agreed by the parties, the place of any
arbitration proceedings shall be San Diego, California.

    

    IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as
of the day and year first above written.

     

    SPECTRASCIENCE,
INC.

     

    By_____________________

     

    Its:____________________

    

    ACCEPTED

    

    _________________________

    Optionee

    
      
         

      

      
        3

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00157-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00157-of-00352.parquet"}]]