**Art. 0 Concession Agreement between the Municipality of Glarus Nord (hereinafter referred to as the Municipality) and Technische Betriebe Glarus Nord (hereinafter referred to as TBGN) - Introduction**

1. According to the Federal Electricity Supply Act (Strom VG), the canton designates the grid areas of the grid operators active within the canton (according to grid levels), which for the canton is defined in Art. 42 et seq. of the Glarus Energy Act (EnG). StromVG and StromVV (Electricity Supply Ordinance) also regulate the duties of grid operators and those responsible for the basic supply of electrical energy within the framework of sovereign tasks as federal enforcement bodies. Pursuant to EnG Art. 43, municipalities may furthermore grant grid operators a service mandate; in particular for

a) * ensuring the basic supply;

b) * ensuring security of supply in the grid area, in particular measures for managing extraordinary situations.

2. Since January 1, 2011, TBGN, as the legal successor to the former EWs (electricity works), has ensured the supply of electrical energy in the municipality of Glarus Nord. By decision of the Government Council dated April 10, 2012, TBGN was commissioned as the grid operator for the municipality of Glarus Nord, with the exception of the Fritz & Caspar Jenny AG premises (grid level 5B).

3. This concession agreement regulates the legal relationship between the parties. It establishes the legal prerequisites for a long-term guarantee of the municipality's supply and the associated tasks in the liberalized electricity market.

4. This concession agreement regulates

a) * the special use of public land and property by TBGN, which is required for the construction, operation, retention (subject to compliance with environmental protection legislation), and maintenance of all buildings and facilities, particularly in connection with the production of electrical energy, district heating, and gas, as well as with grids for the distribution of electrical energy, district heating, gas, and data transmission;

b) * the supply of end customers with electrical energy, district heating, and gas, as well as communication services and other related services and the necessary infrastructures for them, such as for data transmission, etc., within the framework of legal provisions and technical possibilities; and

c) * the operation of public lighting in the municipality, which is owned by the municipality.

1. The Municipality grants TBGN the concession to commercially and sovereignly[1] supply electricity within its municipal territory for the duration of this contract, and to take over, expand, construct, renew, and operate the necessary lines and facilities.

2. The competencies necessary for fulfilling the tasks related to sovereign powers, financing, and tariff setting are transferred to TBGN in accordance with Articles 3 and 4 of the "Organizational Regulations TBGN" (dated January 13, 2010).

3. TBGN may provide further services for the Municipality (e.g., public lighting, district heating, gas supply, billing for water supply and wastewater disposal, communication services, etc.).

4. The details for the provision and remuneration of such services shall be regulated either in this contract or separately between the Municipality and TBGN.

5. TBGN are entitled to provide further services or activities for third parties and to operate as an independent provider outside the municipal territory of Glarus Nord, provided that the primary tasks are not impaired thereby.

1. When fulfilling the assigned tasks, the following principles shall apply in particular

a) Compliance with legal and regulatory provisions and frameworks;

b) Obligation to supply electricity within the the municipal area in accordance with legal and regulatory requirements;

c) Economic efficiency and profitability of service provision;

d) Security of supply and industry-standard technical condition of facilities;

e) Cooperation and coordination with the municipality.

1. The TBGN are entitled to claim public land for their facilities and pipelines. The manner of claiming the land must be agreed upon with the competent municipal authorities.

2. The costs for claiming public land and for restoring it to its original condition shall be borne by the TBGN.

3. Joint (construction) projects shall be planned and optimized in such a way that the most optimal cost/benefit ratio is achieved for both parties.

4. The TBGN shall record the location of all their own facilities and pipelines in documents. If necessary, these documents shall be made available to the municipality upon request, where possible in electronic form.

1. Pursuant to the municipal assembly resolution of January 13, 2010, the TBGN assumed, effective January 1, 2011, the assets and liabilities according to the transfer balance sheet, including all installations and lines of the electricity supply, gas supply (Mollis and Näfels), as well as the communication network (GGA) and the power plants, including all associated rights and obligations.

2. The TBGN guarantee to the municipality the fulfillment of all ongoing obligations and indemnify the municipality against any claims that might be asserted against it in connection with the transferred installations and lines.

1. The TBGN shall pay the municipality an annual compensation for the use of land for power plants, transformer stations, distribution cabinets, etc., in the amount of CHF 50,000.00, as well as for the use of water rights (CHF 0.5/kWh), dependent on energy production, which, together with the levy to the canton, shall not exceed the maximum permitted by the Water Rights Act.

2. Furthermore, the TBGN shall pay the municipality an annual fee for the transfer of the supply right and the use of public land for the network of lines. This amounts to CHF 0.3 per kilowatt-hour of electricity sold within the municipal area of Glarus Nord. This fee shall be itemized on the customers' electricity bills. Any adjustment shall be made before September 1st for the upcoming year.

3. The compensations shall be paid two months after the end of the TBGN's financial year.

4. It is agreed that after four years from the start of the contract (for the first time on January 1, 2018), both parties may request a renegotiation of the compensation amounts.

5. If a contracting party wishes such an adjustment, it shall notify the other contracting party in writing at least three months before the expiry of the current term. If no timely notification is made, the amounts shall remain valid for another four years.

1. TBGN shall construct, operate, and maintain the public lighting for streets and squares on behalf of the municipality. The corresponding expenses shall be charged to the municipality at competitive prices. The electricity supply for public lighting shall be governed by the prices for the supply of electrical energy for the corresponding segment.

2. Projects for the expansion of public lighting shall be developed by TBGN based on a mandate from the municipality and shall be submitted to the competent municipal authorities for approval prior to their execution.

1. Services between the TBGN and the municipality will be mutually invoiced based on actual effort.

2. The TBGN and the municipality may also agree on flat-rate remunerations.

3. The municipality undertakes, within the framework of data protection, to report mutations (address and name changes) from the residents' registration office and property designations from building and environment to the TBGN free of charge for the maintenance of the customer database. Furthermore, the municipality undertakes to provide the planning values and statistical data necessary for ensuring the energy supply and for the development facilities.

1. Performance monitoring will be carried out on the basis of the following indicators

a) Compliance with the annual budget, involving the designated authorities (Board of Directors, Municipal Council);

b) * Monitoring of business development by the Board of Directors and reporting to the Municipal Council (interim report at mid-year and full report as part of the annual report).

1. The TBGN provide services in accordance with industry quality standards and superordinate laws, and document them as required. Audit reports will be presented to the Municipal Council by the TBGN.

2. In the reporting to the Municipal Council, the TBGN shall provide the following documents / reports

a) Annual financial statements and annual report including auditor's report;

b) Status of implementation of measures in risk management and internal control system (within the scope of the annual financial statements and annual report);

c) Oral reporting to the Municipal Council on business development (twice a year);

d) Evaluation of criteria for service performance (industry key figures).

1. This concession agreement commences on January 1, 2014, and is concluded for an indefinite period.

2. The agreement may be terminated by either party for the first time on December 31, 2024, after the expiry of ten contract years, by written notice. A preceding two-year notice period shall apply.

3. If no notice of termination is given, the agreement shall be extended for successive five-year periods, subject to the same notice period.

4. Should TBGN materially breach this agreement and repeatedly fail to fulfill its supply obligations, the municipality shall be entitled, after written warning and the setting of a reasonable deadline, to withdraw from the agreement outside the ordinary notice period.

1. The municipality has the right, upon contract expiry, to demand the retransfer of networks and facilities located within its territory.

2. In the event of a contract withdrawal pursuant to Article 10 hereof, the municipality is entitled to demand the retransfer without compensation. Mutual claims for damages remain reserved.

1. In accordance with Article 3 of the Organizational Regulations, the TBGN are not authorized to transfer rights and obligations arising from this contract, as well as supply networks and associated facilities, to third parties without the consent of the Municipal Council.

1. The Contracting Parties undertake to submit any disputes to a three-member arbitration commission before recourse to the competent authorities or courts.

2. Each Contracting Party shall appoint one member of the commission.

3. The two commission members appointed by the Contracting Parties shall jointly elect the chairperson of the commission. If they are unable to agree, the chairperson shall be designated by the President of the High Court of the Canton of Glarus.

1. Amendments or additions to the concession agreement require written form and are subject to an optional referendum.

1. Land parcels owned by TBGN that are no longer required for the fulfillment of its tasks shall revert to the municipality if they were transferred to TBGN by the municipality or one of its predecessor municipalities, or by a public-law institution or other corporation.

2. Land parcels acquired by TBGN through other means must be offered to the municipality of Glarus Nord or one of its institutions for acquisition before any disposal.

3. For important reasons, the municipal council may prohibit a disposal.