Existence and Legal Form (TBGN)

1. Under the name "Technische Betriebe Glarus Nord (TBGN)" (hereinafter: "TBGN"), there exists an independent, public-law institution of the Municipality of Glarus Nord (Municipality) with its own legal personality and domicile in Glarus Nord. It possesses its own assets and keeps its own accounts. The name is registered in the commercial register.

1. The primary task of TBGN is the electricity supply to the municipality of Glarus Nord.

2. TBGN shall undertake the following tasks for the municipality

a) Construction, operation, and maintenance of its own power plants;

b) Production of and trade in energy (electricity, gas, district heating);

c) Construction, operation, and maintenance of energy distribution networks (electricity, gas, district heating);

d) Construction, operation, and maintenance of the municipality's own public lighting;

e) Construction, operation, and maintenance of communication networks;

f) Promotion of the efficient use of energy;

g) Promotion of the production and use of renewable energies;

h) The Municipal Council may assign further tasks to TBGN. This shall occur on the basis of performance agreements and/or concession agreements.

3. The corporate strategy of TBGN is based on the ownership strategy of the municipality. The adoption of the ownership strategy shall be in accordance with the municipal regulations.

4. TBGN are obliged, through competent advice and suitable funding programs, to sustainably keep customers' energy consumption low and to take into account ecological and sustainability concerns when selecting suppliers.

5. A concession agreement shall be concluded between the municipality and TBGN, which shall regulate the details. The adoption of the concession agreement shall be in accordance with the municipal regulations.

6. TBGN are entitled, in accordance with the concession agreement with the municipality, to supply other networks or municipalities with energy and communication services or to undertake related tasks.

7. The institution may acquire or dispose of real estate, as well as enter into all transactions and conclude contracts (with the exception of participations) that are suitable for promoting the purpose of TBGN, or that are directly or indirectly related thereto. Individual investments from CHF 2,000,000.00 to CHF 4,000,000.00 must be approved by the Municipal Council and are subject to an optional referendum. Individual investments exceeding CHF 4,000,000.00 shall be decided by the municipal assembly.

8. The institution may acquire participations in companies, wholly or partially take over similar or related companies, establish companies itself, and dispose of participations, provided that this demonstrably secures its long-term economic viability and/or improves its market position. The consent of the Municipal Council is necessary for transactions exceeding CHF 100,000.00 or if TBGN's participation after the transaction amounts to more than one-third, or if a participation falls below the one-third threshold again upon sale.

1. The necessary financial resources are available as follows or are to be procured

a) Endowment capital;

b) accumulated reserves;

c) Loans, leasing, provisions, and other borrowed capital.

2. According to the balance sheets as of December 31, 2010, and separate registers, TBGN assumed and received all assets and liabilities as well as all rights and obligations

a) from the municipalities of Bilten, Filzbach, Obstalden, and Mühlehorn, the installations of the electricity supply companies;

b) from the municipalities of Niederurnen and Oberurnen, the installations of the power plants (incl. control and management systems) and the electricity supply companies;

c) from the municipality of Mollis, the installations of the electricity and gas supply companies as well as the communication installations;

d) from the municipality of Näfels, the installations of the independent institution EW Näfels (power plants, electricity supply, communication installations) as well as the gas supply company.

3. The endowment capital amounts to CHF 4,000,000.00 and is wholly owned by the municipality of Glarus Nord.

1. Only the assets of the TBGN are liable for its obligations. Liability of the municipality is expressly excluded.

2. The liability of the TBGN for damages caused by employees to third parties in the performance of their duties is governed by the State Liability Act of the Canton of Glarus. Paragraph 3 below remains reserved.

3. In cases where the TBGN enters into a private law contract with its customers, liability is governed by the Swiss Code of Obligations (OR).

1. The Municipal Council of Glarus Nord exercises supervision over TBGN.

2. The annual financial statements must be submitted annually to the Municipal Council for approval by the Municipal Assembly.

3. The annual report is submitted annually to the Municipal Council for approval.

4. The Municipal Council takes annual note of the budget.

1. To the extent of the delegated tasks, the TBGN are entrusted with the execution of the associated public duties under the legislation of the federal and cantonal governments. The TBGN, in particular, assume the obligation to supply electricity. To the extent necessary for the fulfillment of these tasks, the municipality grants the TBGN the necessary sovereign powers.

2. As long as the relationship between the TBGN and the customers of electricity, gas, and communication services is considered public-law, the TBGN are authorized to issue orders in this regard. The general principles of administrative law must be observed.

1. For the financing of the electricity supply, gas supply, and the communication network, TBGN levy one-time fees based on the agreed services and recurring fees to cover operating expenses and the uncovered portion of investments.

2. The recurring fees shall allow TBGN an appropriate revenue surplus, thereby enabling long-term business security (depreciation, interest, necessary replacement investments, adequate equity formation).

3. The conditions for energy supplies to the various customer groups and the amount of one-time and recurring fees are determined by TBGN in General Terms and Conditions and in tariffs/prices, taking into account the above financing and tariff principles as well as statutory requirements.

4. Development cost contributions for supply tasks within the monopoly area are levied by TBGN on the basis of the applicable decrees.

1. The organs of the TBGN are

a) the Board of Directors;

b) the Executive Management;

c) the Auditing Body.

2. Their tasks and competencies are laid down in the following provisions and in the Business Regulations.

3. In the absence of a specific regulation, the remaining municipal law and the law of the Canton shall apply.

1. The Board of Directors shall consist of a maximum of seven members.

2. The eligible voters shall elect two members in accordance with the municipal regulations.

3. The Municipal Council shall elect the remaining members, after hearing the Board of Directors, one of whom shall be from among the members of the Municipal Council.

4. The Chairperson of the Board of Directors shall be elected by the Municipal Council. The Chairperson of the Board of Directors may only belong to the Municipal Council in exceptional cases. Otherwise, the Board of Directors shall constitute itself.

5. Employees of the municipality and the institution may not be members of the Board of Directors.

6. The regulations concerning the remuneration of the members of the Board of Directors shall be issued in accordance with the municipal regulations.

7. The term of office of the members of the Board of Directors shall coincide with that of the authorities of the municipality of Glarus Nord. Re-election is permissible.

8. ...

1. The Board of Directors supervises the executive management and decides on all matters, unless these have been assigned by law or this organizational regulation to another body for decision.

2. The Board of Directors has the following inalienable and indefeasible duties and powers

a) Enactment of a business regulation, which particularly organizes the management, determines the required positions, outlines their duties, competencies, and responsibilities, and regulates reporting;

b) * Employment of all members of the executive management as well as the termination and dissolution of these employment relationships;

c) Definition of the business policy, which is reviewed at least once a year and adjusted if necessary;

d) Enactment of regulations concerning the supply of energy, gas, as well as communication and other services in the public and private law sectors;

e) Approval of the budget;

f) * Preparation of the annual report and the annual financial statements;

g) Definition of the financial and investment planning;

h) Conclusion of framework agreements with energy suppliers and communication and other service providers;

i) Conclusion of contracts with third-party municipalities to be supplied;

j) Enactment of personnel directives and additions to the personnel ordinance;

k) Definition of the insurance strategy;

l) * The purchase and sale of real estate subject to financial competence, the acquisition of rights, and the taking out of loans;

m) * Decision-making on the development of new strategic business areas;

n) * Decision-making on the formation and acquisition of or participation in enterprises and on the sale of such participations, subject to the competencies according to Art. 2 Para. 8;

o) Unless the executive management is responsible according to the business regulation

1. Approval of expenditures and expenses from the current account

2. Appointment of representatives of the TBGN in organizations and associations.

1. The board of directors has a quorum when the majority of the members are present.

2. In decision-making, the majority of the votes cast decide the matter. In the event of a tie, the president shall have the casting vote.

1. The Chairman and Vice-Chairman of the Board of Directors sign jointly or with a member of the Board of Directors, collectively by two, for the institution.

2. The Board of Directors may also designate members of the executive management and other employees who have signing authority collectively by two or with a member of the Board of Directors. Details shall be governed by the institution's bylaws.

1. The managing director is subordinate to the Board of Directors. They are responsible for the operational management of the institution and lead the executive management in accordance with the strategic guidelines of the Board of Directors.

2. The managing director participates in meetings of the Board of Directors with an advisory vote and has the right to submit proposals.

3. The managing director represents the institution externally, subject to the competencies of the Board of Directors.

4. Furthermore, the powers of the executive management and the managing director are defined in the organisational regulations, which are issued by the Board of Directors.

5. The executive management is responsible for the hiring, termination, and ending of employment relationships, unless these fall within the competence of the Board of Directors.

1. The Business Audit Committee, after consulting the Municipal Council, selects an expert and industry-savvy auditing body for the audit of the accounts.

2. The auditing body is elected annually.

3. The auditing body must annually, after the closing of accounts, audit the annual financial statements and the balance sheets and report to the Municipal Council for the attention of the Municipal Assembly.

1. Personnel must be employed under private law in accordance with the municipal regulations.

2. The institution shall insure its personnel itself against the economic consequences of accident, illness, invalidity, old age, and death, in coordination with the municipality.

1. The fiscal year corresponds to the calendar year.

2. The financial accounting is governed by the Code of Obligations. It must provide an accurate representation of the actual asset, financial, and income situation. In particular, tangible and intangible assets should be recorded on the balance sheet at acquisition and production costs, minus necessary depreciation in accordance with industry standards.

1. The TBGN are operated on a commercial basis and within the scope of the supply mandate at the organization's own financial risk.

2. Based on Article 5 of the Municipal Code, tasks that can be fulfilled jointly with other communities or private entities are transferred to them to utilize synergies.

3. The TBGN maintain separate cost accounts for the areas of networks, energy, and services, and any other potential areas, according to industry-standard principles.

1. Depreciations shall be conducted in accordance with federal legal requirements (e.g., Electricity Supply Act - StromVG) and according to industry-standard norms. They should substantially enable the self-financing of investments and ensure the timely and need-based maintenance and renewal of facilities.

2. Appropriate provisions shall be made for risks.

1. TBGN shall pay the Municipality of Glarus Nord a reasonable interest on the endowment capital.

2. The interest on the endowment capital and the appropriation of profits shall be determined in the owner strategy.

3. Any profits shall be distributed equally between the customers and TBGN.

1. Against dispositions issued by the management, based on the present regulations and further rules, an appeal may be lodged with the Board of Directors of TBGN within 30 days of service, in writing, stating reasons and including a request.

2. Against invoices based on public-law tariffs, an objection may be lodged with TBGN within 30 days.

3. The further procedure shall be governed by the Administrative Procedure Act of the Canton of Glarus.

4. For actions in the area of TBGN's private law activities, the civil court route must be pursued.

1. Final and legally binding orders of the TBGN, including their invoices against which no objection has been raised, are equivalent to enforceable court judgments in accordance with Art. 80 para. 2 of the Federal Act on Debt Enforcement and Bankruptcy.

2. Claims that the TBGN invoices based on private law contracts must be asserted through civil procedure.

1. The decision on the dissolution or sale of parts or the entire institution, and the liquidation thereof, is made by the municipal assembly.

2. Any potential liquidation proceeds shall pass to the municipality of Glarus Nord.