Records; Audit Rights; Annual Certification.

Records.

POU shall maintain accurate records and accounts relating to NBCs in sufficient detail to permit IOU's auditor to exercise the audit rights described in Section ___ below.

Audit Rights.

Upon ___ days prior written notice, IOU may request an audit, conducted by an independent third party, of POU's records and procedures, which shall be limited to records and procedures containing information bearing upon: (i) NBCs being billed to Customers by POU (and Customer payments of NBCs); (ii) fees for Consolidated Billing Service provided by POU pursuant to this Agreement; (iii) POU's performance of its obligations under this Agreement; and (vii) such other matters as may be permitted by Applicable Law. The audit shall be conducted during Business Hours without interference with POU's normal operations, and in compliance with POU's security procedures.

IOU shall have the right and responsibility to hire the independent third party auditor, and IOU shall bear any associated fees. In its contract with the independent third party auditor, IOU shall ensure that Confidential Information regarding Customer(s) is not provided or disclosed to IOU.

(c ) Items identified during the independent third party audit requiring corrective action shall be discussed first with the POU and if necessary, the POU will take identify the planned corrective action and promptly resolve issues.

Confidentiality.

Materials reviewed by the independent third party in the course of an audit may contain Confidential Information subject to Section ___ above. The use of all materials provided to the independent third party shall comply with the provisions in Section __ and shall be limited to use in conjunction with the conduct of the audit and preparation of a report for appropriate distribution of the results of the audit consistent with Applicable Law.

Annual Reports.

At least annually, POU shall cause a firm of independent certified public accountants (which may provide other services to POU) to prepare, and POU will deliver to DWR, a report addressed to POU (which may be included as part of POU's customary auditing activities), for the information and use of DWR, to the effect that such firm has performed certain procedures (the scope of which shall be agreed upon with IOU and DWR) in connection with POU's compliance with its obligations under this Agreement during the preceding year, identifying the results of such procedures and including any exceptions noted. POU may include the costs of producing this annual report in its estimate of Recurring Fees to be reimbursed by IOU.

Annual Certifications.

At least annually, each Party will deliver to the other Party and to DWR a certificate of an authorized officer certifying under oath that to the best of such officer's knowledge, after a review of the Party's performance under this Agreement, such Party has fulfilled its obligations under this Agreement in all material respects and is in compliance herewith in all material respects.

Additional Applicable Laws.

Each Party agrees to promptly notify the other Party in writing to the extent such Party becomes aware of any new Applicable Laws or changes (or proposed changes) in Applicable Tariffs hereafter enacted, adopted or promulgated that may have a material adverse effect on either Party's ability to perform its duties under this Agreement. However, failure to so notify the other Party pursuant to this Section __ will not constitute a material breach of this Agreement, and will not give rise to any right to terminate this Agreement or cause either Party to incur any liability to the other Party or any third party.

Other Information.

Upon the reasonable request of IOU or its Assign(s), POU shall provide to IOU or its Assign(s) any public financial information in respect of the POU applicable to Consolidated Billing Service provided by POU under this Agreement, or any material information regarding the collection of NBCs to the extent such information is reasonably available to POU, which (i) is reasonably necessary and permitted by Applicable Law to monitor the performance by POU hereunder, or (ii) otherwise relates to the exercise of IOU's rights or the discharge of IOU's duties under this Agreement or any Applicable Law. In particular, but without limiting the foregoing, POU shall provide to IOU any such information that is necessary or useful to calculate IOU's revenue requirements.

Customer Confidentiality.

Nothing in this Section __ shall affect the obligation of POU to observe any Applicable Law prohibiting disclosure of information regarding Customers, and the failure of POU to provide access to such information as a result of such obligation shall not constitute a breach of this Section ___ or this Agreement.