METROPOLITAN WATER DISTRICT 2 -2005

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Metropolitan's rate structure after any such change in rate structure or violation of the law regarding rate setting processes until, and unless, they have exhausted all administrative opportunities available to them pursuant to Metropolitan's public board process. 7.3. Santa Ana agrees that all users ofthe Metropolitan conveyance and distribution system should support the LRP, CCP, and SDP; that such projects provide benefits to Metropolitan and the users of the system by making existing distribution and conveyance capacity available for additional delivery; and, that under Existing Rate Structure, the Water Stewardship Rate is an element of charges properly adopted by the Metropolitan Board and properly applied to water wheeled through the Metropolitan conveyance and distribution system. 7.4. Should Santa Ana file or support litigation, or sponsor or support legislation, that would challenge or be adverse to Existing Rate Structure, as described in Section 7.2, Metropolitan's Chief Executive Officer may file a 90-day notice of intent to terminate this Agreement with Metropolitan's Executive Secretary, with copies to all members of Metropolitan's Board of Directors, and contemporaneously provide Santa Ana with a copy of the notice. Within 30 days of receipt of such notice, Santa Ana shall have the right to request, in writing, mediation of the dispute by a neutral third party with expertise in finance and rate setting. The mediator shall be selected by agreement of the parties, or failing agreement within 60 days of such request for mediation, a mediator shall be selected by the Metropolitan Board of Directors from a list of at least four candidates, two from Santa Ana, and two of which will be supplied by Metropolitan's Chief Executive Officer. The cost of the mediation shall be borne equally by the parties. The request for mediation shall also serve to stay the 90-day notice of intent to terminate, but for no more than 90 days beyond the filing of the notice of request for mediation, unless otherwise agreed in writing by the parties. If mediation does not result in an agreement acceptable to each Party to this Agreement within the time provided herein, the notice of intent to terminate shall be reinstated. The Metropolitan Board of Directors shall act to approve or disapprove termination of this Agreement, and all of Metropolitan's obligations hereunder shall terminate if approved, on or before the ninetieth day following filing of the notice to terminate or, if mediation has been requested as described above, the ninetieth day following the request for mediation (or other date agreed in writing by the Parties). 7.5. Should litigation or legislation be brought forth or sponsored by a party or parties not referenced herein, resulting in changes to the Existing Rate Structure, this Agreement will continue in effect unless mutually agreed in writing by the Parties. 7.6. Should Metropolitan and its member agencies agree on an alternative rate and revenue structure that obviates the need for this Section on Rate Structure Integrity Provisions, this section shall be amended or deleted to conform to such action. 7.7. Notwithstanding the foregoing, Metropolitan shall have no power or authority under this Section to terminate this Agreement, and Metropolitan's Chief Executive Office shall not file a 90-day notice of intent to terminate this Agreement, if Santa Ana files or City of Santa Ana - Santa Ana Stadium - 4- STP Agreement No. 69877