1016-00004 · Dunmore Energy Holdings · Consent Agreement

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PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT ATTORNEY-CLIENT PRIVILEGED COMMUNICATION

[C&H MARKED DRAFT — FOR INTERNAL REVIEW] Reviewed by C. Bloom and H. Brinkley — January 26, 2024 C&H Matter Number: 1016-00004 C&H Billing Code: 71420.00001

UNITED STATES OF AMERICA BEFORE THE FEDERAL ENERGY REGULATORY COMMISSION

DRAFT — STIPULATION AND CONSENT AGREEMENT

> [MARGINAL NOTE — C. Bloom, 1/26/2024]: This draft reflects the agreed terms from the January 24, 2024 negotiations with FERC Staff (Christine Pham) and incorporates C&H's proposed language revisions for FERC Staff review. All tracked changes reflect C&H's proposed modifications to the working draft exchanged during the January 24 settlement conference. Open items are flagged in marginal comments throughout. Please review and return comments by COB Monday, January 29, 2024.

I. CAPTION AND INTRODUCTORY PARAGRAPH

UNITED STATES OF AMERICA BEFORE THE FEDERAL ENERGY REGULATORY COMMISSION

In the Matter of Dunmore Energy Holdings Ltd. and Dunmore Power Trading LLC

Docket No. IN23-7-000

STIPULATION AND CONSENT AGREEMENT

The Staff of the Office of Enforcement of the Federal Energy Regulatory Commission ("Commission Staff" or "FERC Staff"), Dunmore Energy Holdings Ltd. ("DEH"), an exempted company incorporated under the laws of the Cayman Islands, with its registered office at 4th Floor, Harbour Place, 103 South Church Street, George Town, Grand Cayman, KY1-1002, Cayman Islands, and its principal United States office at 2200 Post Oak Boulevard, Suite 3100, Houston, Texas 77056 (EIN: 98-1347562), and Dunmore Power Trading LLC ("DPT"), a Delaware limited liability company, with its principal office at 2200 Post Oak Boulevard, Suite 3100, Houston, Texas 77056 (EIN: 82-4519763), with its registered agent at Capitol Registered Agents Inc., 1209 Orange Street, Wilmington, Delaware 19801 (DEH and DPT collectively referred to herein as "Respondents"), hereby enter into this Stipulation and Consent Agreement ("Agreement") to resolve the matters set forth herein, pursuant to the Commission's Rules of Practice and Procedure and the Commission's Revised Policy Statement on Enforcement.

> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: Confirm FERC Staff's preferred formulation for the party identifications. Staff sometimes prefers "Commission Staff" over "FERC Staff" throughout the body of the agreement. In recent consent agreements (e.g., Docket No. IN22-4-000, Vitanova Trading), Staff used "Commission Staff" as the primary defined term. Recommend using "Commission Staff" as the primary reference and "FERC Staff" only as a secondary parenthetical. Adjust throughout if Staff objects.

Commission Staff and Respondents are collectively referred to herein as the "Parties." The Parties enter into this Agreement voluntarily and without any party being under duress or compulsion. This Agreement is contingent upon approval by the Commission and shall become effective upon the date of the Commission's order approving this Agreement in its entirety and without material modification (the "Effective Date").

II. RECITALS

WHEREAS, the following recitals set forth the background facts and circumstances relevant to this Agreement:

A. Background of the Investigation

1. DPT holds market-based rate authority from the Commission, granted under Docket No. ER05-1128-000, pursuant to which DPT has been authorized to sell electric energy, capacity, and ancillary services at market-based rates, and has been an active participant in the wholesale electricity markets administered by the Midcontinent Independent System Operator, Inc. ("MISO") since approximately 2006.

2. On or about April 3, 2023, Velthorn Market Analytics, Inc., serving as the Independent Market Monitor ("IMM") for MISO, submitted a referral letter to the Commission's Office of Enforcement identifying certain bidding patterns by DPT in MISO's Day-Ahead and Real-Time energy markets. The IMM referral described anomalous trading patterns observed at certain pricing nodes and raised questions regarding the economic rationale underlying certain generation offers and virtual transactions submitted by DPT during calendar years 2022 and 2023.

3. Following receipt of the IMM referral, on May 22, 2023, the Commission's Office of Enforcement issued a preliminary inquiry letter to Dunmore Energy Holdings Ltd. requesting information and documents relating to DPT's trading activity in the MISO markets during the period identified in the IMM referral.

4. On June 12, 2023, the Commission's Office of Enforcement issued a formal non-public order of investigation in this docket, Docket No. IN23-7-000, pursuant to 18 C.F.R. Part 1b, authorizing Commission Staff to investigate whether DPT's trading activity in the MISO Day-Ahead and Real-Time energy markets during the period at issue may have violated Section 222 of the Federal Power Act, 16 U.S.C. § 824v, and the Commission's Anti-Manipulation Rule, 18 C.F.R. § 1c.2.

> [MARGINAL NOTE — C. Bloom, 1/26/2024]: Propose softening language in this recital. Suggest: "the Office of Enforcement commenced an investigation into certain trading activity by DPT" rather than adopting FERC's characterization of the trading as "potentially manipulative." The current formulation in paragraph 4 ("may have violated") is acceptable, but we should avoid any stronger characterization. The recital should reflect a neutral description of the procedural history without endorsing the substance of the allegations.

B. Allegations Under Investigation

5. FERC Staff has alleged that during the period from January 3, 2022 through March 17, 2023 (the "Relevant Period"), DPT engaged in trading activity in the MISO Day-Ahead and Real-Time energy markets at the Indiana Hub and Minnesota Hub pricing nodes that may have constituted a violation of Section 222 of the Federal Power Act, 16 U.S.C. § 824v, and the Commission's Anti-Manipulation Rule, 18 C.F.R. § 1c.2.

6. Specifically, FERC Staff has alleged that DPT engaged in the following three categories of conduct during the Relevant Period:

(a) Uneconomic Day-Ahead Generation Offers at Indiana Hub. FERC Staff has alleged that DPT submitted Day-Ahead offers for gas-fired generation units at the Indiana Hub at prices significantly below marginal cost, including offers at price levels as low as negative fifteen dollars per megawatt-hour (-$15/MWh) to negative forty dollars per megawatt-hour (-$40/MWh), allegedly for the purpose of creating artificial congestion patterns in the Day-Ahead market while DPT simultaneously held Financial Transmission Rights ("FTRs") that would benefit from the resulting congestion. FERC Staff has alleged that DPT's generation offers were not economically rational when viewed in isolation from DPT's FTR portfolio, and that the purpose and intended effect of the offers was to move congestion patterns in a manner that would increase the value of DPT's FTR positions.

(b) Cross-Product Virtual Transactions at Minnesota Hub. FERC Staff has alleged that DPT submitted cross-product virtual transactions, including Increment Offers ("INCs") and Decrement Bids ("DECs"), at the Minnesota Hub pricing node that were allegedly designed to amplify congestion differentials between the Indiana Hub and the Minnesota Hub. FERC Staff has alleged that these virtual transactions lacked independent economic rationale and were coordinated with DPT's generation offers and FTR positions to maximize the value of DPT's overall portfolio at the expense of market integrity.

(c) Alleged Coordination of Gas Nominations. FERC Staff has alleged that DPT coordinated gas nominations through an affiliated entity, Dunmore Midstream Partners LP ("DMP") (EIN: 47-8831205), to support the uneconomic generation offers described above. FERC Staff has alleged that DMP's gas scheduling activity during certain periods of the Relevant Period was timed and structured to ensure that DPT's gas-fired generation units at the Indiana Hub could operate at the below-cost offer levels submitted in the Day-Ahead market, thereby facilitating the alleged scheme.

> [MARGINAL NOTE — C. Bloom, 1/26/2024]: This recital should use "FERC Staff alleged" or "FERC Staff has alleged" language consistently throughout — I have revised accordingly. We need to ensure nothing here could be read as an admission by Respondents. Every sentence describing the conduct must be framed as an allegation of Staff, not as a stipulated fact. I propose the following additional sentence at the end of paragraph 6: "Respondents dispute these allegations and deny that any of the trading activity described herein constituted a violation of the Federal Power Act or the Commission's regulations."

> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: Check that the description of the alleged conduct tracks the Preliminary Findings letter of October 2, 2023 without embellishing. Do not include FERC Staff's characterizations beyond what is necessary for context. The current draft pulls language from paragraphs 14–38 of the Preliminary Findings letter. Confirm that the FTR-related allegations (paragraph 6(a)) do not incorporate any of the characterizations from Christine Pham's January 10, 2024 email, which went beyond the Preliminary Findings letter.

C. Volume and Scope of Alleged Conduct

7. FERC Staff has estimated that DPT's trading activity during the Relevant Period that is the subject of the allegations described in Section II.B above included:

(a) Total Day-Ahead generation offers at issue of approximately 2,840 gigawatt-hours (GWh) over the Relevant Period;

(b) FTR positions with a notional value of approximately Forty-Seven Million Three Hundred Thousand Dollars ($47,300,000); and

> [MARGINAL NOTE — C. Bloom, 1/26/2024]: Propose adding an express qualifier: "FERC Staff estimated that…" — these are Staff's figures, not agreed-upon facts. Our own analysis (Dr. Andrew Whitfield, Meridian Economic Consulting) calculated significantly lower volumes for categories (a) and (c). However, for purposes of settlement, we need not contest Staff's figures in the recitals as long as they are clearly attributed to Staff. Confirm with the client that the recitation of these figures in the consent agreement will not create issues for DPT's market-based rate filings or MISO market participation going forward.

D. Respondents' Cooperation

8. Respondents cooperated fully and in good faith with the Commission's Office of Enforcement throughout the investigation, including:

(a) Production of approximately one hundred eighty-seven thousand (187,000) documents, comprising approximately 1.24 million pages, collected from eleven (11) custodians within Respondents' organizations;

(b) Making six (6) employees available for investigative testimony under 18 C.F.R. § 1b.12, including members of DPT's trading desk, risk management, and compliance functions;

(c) Providing detailed narrative responses to two sets of data requests from Commission Staff, consisting of forty-one (41) interrogatories and twenty-three (23) document requests in the first set, and eighteen (18) supplemental interrogatories in the second set; and

(d) Responding to all requests from Commission Staff in a timely and complete manner throughout the investigation.

9. Respondents retained outside counsel, Calderwood & Harkness LLP, to assist in responding to the investigation, and through outside counsel, maintained regular and constructive communications with Commission Staff throughout the pendency of the investigation. Respondents provided timely responses to all data requests and did not seek to delay or obstruct the investigative process.

E. Respondents' Remedial Measures

10. DEH appointed Jennifer Caulfield as Chief Compliance Officer on February 6, 2023, prior to the commencement of the investigation in this docket. Ms. Caulfield reports directly to the Board of Directors of DEH and has been vested with authority and resources to oversee Respondents' compliance with the Federal Power Act, the Commission's regulations, and applicable market rules.

11. In connection with the investigation and the settlement negotiations described herein, Respondents retained Ridgeway Compliance Solutions LLC, an independent compliance consulting firm, to serve as an independent compliance consultant and monitor with respect to Respondents' wholesale electricity trading operations. Ridgeway Compliance Solutions LLC, under the direction of Dr. Carolyn Whitford, Founder and Managing Director, has undertaken a comprehensive review of Respondents' compliance policies and procedures and has made recommendations for enhancements, which have been incorporated into the Enhanced Compliance Plan described in Section III.C and attached as Appendix A to this Agreement.

12. Respondents have committed to the adoption and implementation of the Enhanced Compliance Plan attached as Appendix A hereto, which sets forth comprehensive compliance measures designed to prevent, detect, and deter potential violations of the Federal Power Act and the Commission's regulations.

F. Settlement Negotiations

13. Following the issuance of FERC Staff's Preliminary Findings letter on October 2, 2023, and Respondents' Response to Preliminary Findings submitted on November 6, 2023, the Parties engaged in settlement negotiations with the goal of reaching a consensual resolution of the matters under investigation in this docket.

14. The Parties conducted settlement conferences on December 5, 2023, January 8, 2024, and January 24, 2024, and exchanged written settlement proposals and counterproposals during the period from November 2023 through January 2024.

15. The Parties have reached an agreement on the terms and conditions set forth herein in the interest of resolving this matter efficiently and without the need for further administrative proceedings, including without the need for a hearing before an Administrative Law Judge, the assessment of additional civil penalties by the Commission, or further litigation of the matters at issue. The Parties believe that the terms of this Agreement are fair, reasonable, and in the public interest.

> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: Standard FERC settlement recital language. Confirm this tracks recent consent agreements in analogous manipulation cases — compare Docket No. IN22-4-000 (Vitanova Trading, approved Dec. 2023) and Docket No. IN21-11-000 (Cascade Grid Partners, approved Sept. 2023). The "fair, reasonable, and in the public interest" formulation is the Commission's standard for approval of consent agreements.

G. Neither Admit Nor Deny

16. Respondents neither admit nor deny the allegations, findings, or conclusions described in this Agreement or in FERC Staff's Preliminary Findings letter dated October 2, 2023, or in any other document or communication issued by Commission Staff in connection with the investigation in Docket No. IN23-7-000. Respondents enter into this Agreement solely for the purpose of resolving the matters addressed herein, and this Agreement shall not be construed as an admission of any violation of the Federal Power Act, the Commission's regulations, or any other law or regulation by Respondents or any of their officers, directors, employees, or affiliates.

17. This Agreement shall not be used as the basis for any finding of violation of the Federal Power Act or the Commission's regulations in any other proceeding, except in a proceeding to enforce the terms of this Agreement. Respondents consent to the use of this Agreement solely for purposes of assessing compliance with its terms and conditions and for any proceeding in which the Commission or Commission Staff seeks to enforce the terms of this Agreement.

> [MARGINAL NOTE — C. Bloom, 1/26/2024]: CRITICAL — This is the "neither admit nor deny" provision. Ensure language precisely mirrors recent FERC consent agreements. I have added the phrase "or any of their officers, directors, employees, or affiliates" to paragraph 16 and the sentence regarding non-use in any other proceeding in paragraph 17. Propose further addition: "Nothing in this Agreement shall be construed as an admission of any violation of the Federal Power Act, the Commission's regulations, or any other law or regulation." This language appears in the Vitanova consent agreement and should be included here. Confirm with Christine Pham that Staff accepts this formulation.

III. TERMS AND CONDITIONS

NOW, THEREFORE, in consideration of the foregoing recitals and the mutual agreements, representations, and commitments set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

A. Civil Penalty

A.1. Penalty Amount.

18. Respondents shall pay a civil penalty in the total amount of Four Million Seven Hundred Fifty Thousand Dollars ($4,750,000.00) to the United States Treasury, pursuant to Section 316A of the Federal Power Act, 16 U.S.C. § 825o-1. DEH and DPT shall be jointly and severally liable for the payment of the full amount of the civil penalty.

> [MARGINAL NOTE — C. Bloom, 1/26/2024]: Confirm payment is to the U.S. Treasury, not to FERC directly — this is the standard formulation under Section 316A of the Federal Power Act. Payment is made by wire transfer to the U.S. Treasury's account per FERC Staff's instructions. Joint and several liability language is standard where there are affiliated respondents.

A.2. Payment Schedule.

19. The civil penalty shall be paid in two (2) equal installments as follows:

(a) The first installment of Two Million Three Hundred Seventy-Five Thousand Dollars ($2,375,000.00) shall be due and payable within thirty (30) calendar days of the Effective Date (as defined in Section I above).

(b) The second installment of Two Million Three Hundred Seventy-Five Thousand Dollars ($2,375,000.00) shall be due and payable within one hundred eighty (180) calendar days of the Effective Date.

20. Payment of each installment shall be made by electronic wire transfer to the United States Treasury in accordance with the wire transfer instructions to be provided by Commission Staff. Respondents shall provide written confirmation of each payment to Commission Staff within five (5) business days of each wire transfer.

> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: Based on the anticipated FERC order date of approximately February 9, 2024: first installment due approximately March 10, 2024; second installment due approximately August 7, 2024. Confirm wire transfer instructions and payee details will be provided by FERC Staff prior to each installment date. Propose adding a sentence requiring Staff to provide payment instructions at least ten (10) business days in advance of each installment due date. I have added paragraph 20 to address the confirmation requirement — confirm this is acceptable to Staff.

A.3. Late Payment.

21. In the event that Respondents fail to make timely payment of any installment of the civil penalty as required by Section III.A.2, interest shall accrue on the outstanding balance from the due date until the date of payment at the rate established by the Internal Revenue Service for the underpayment of federal income taxes under 26 U.S.C. § 6621(a)(2), as in effect on the date that payment was due. The accrual of interest under this provision shall be in addition to, and not in lieu of, any other remedies available to Commission Staff under this Agreement or applicable law.

> [MARGINAL NOTE — C. Bloom, 1/26/2024]: Standard provision. Confirm current rate reference is correct — 26 U.S.C. § 6621(a)(2) currently provides for the federal short-term rate plus 3 percentage points, adjusted quarterly. This is the standard interest provision in FERC consent agreements.

A.4. No Tax Deductibility Representation.

22. Nothing in this Agreement constitutes a representation by any Party regarding the tax deductibility of the civil penalty or any portion thereof. Respondents are solely responsible for determining the tax treatment of the civil penalty in consultation with their own tax advisors and accountants.

> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: Flag for Martin Llewellyn (Dunmore General Counsel) — coordinate with Prescott & Hargrove LLP (Douglas Fenn, CPA) on financial statement treatment and tax implications of the penalty. Under Section 162(f) of the Internal Revenue Code (as amended by the Tax Cuts and Jobs Act), the civil penalty is likely non-deductible. Confirm treatment for financial reporting purposes under ASC 450 (loss contingencies). Separate memo to follow.

B. Disgorgement.

23. No disgorgement of profits or revenues shall be required of Respondents under this Agreement.

24. In consideration of the totality of the circumstances, including Respondents' full and timely cooperation with the investigation, the remedial measures undertaken by Respondents as described in Section II.E above, and the uncertainty inherent in quantifying any unjust profits that may have resulted from the trading activity at issue, FERC Staff has agreed that no disgorgement is warranted in connection with this resolution. This provision reflects a compromise by the Parties and does not constitute a finding or determination by FERC Staff or the Commission that Respondents did or did not earn unjust profits from the trading activity described herein.

> [MARGINAL NOTE — C. Bloom, 1/26/2024]: This was a key negotiation win. FERC Staff's initial demand included $12.8 million in disgorgement. The waiver reflects our arguments (supported by Dr. Andrew Whitfield's economic analysis, Meridian Economic Consulting, showing that the market impact of the trading activity at issue was no more than $2.1 million, and that even this figure was based on a series of contested assumptions regarding counterfactual market outcomes) that unjust profits were speculative and unquantifiable with sufficient certainty to support a disgorgement order. Ensure this provision is clear and unambiguous. Note: the language in paragraph 24 ("uncertainty inherent in quantifying any unjust profits") was specifically negotiated with Christine Pham during the January 24 settlement conference. Do not modify without discussion.

C. Enhanced Compliance Plan

C.1. Adoption and Implementation.

25. Respondents shall adopt and implement the Enhanced Compliance Plan attached hereto as Appendix A (the "Compliance Plan") within the timeframes specified therein. The Compliance Plan shall become effective on the Effective Date and shall remain in effect for a period of thirty-six (36) months from the Effective Date (the "Compliance Monitoring Period"), ending approximately February 9, 2027, based on the anticipated Effective Date.

26. Respondents shall devote such financial, personnel, and organizational resources as are reasonably necessary to ensure full and timely implementation of, and compliance with, the Compliance Plan throughout the Compliance Monitoring Period.

C.2. Key Elements of the Compliance Plan.

27. The Compliance Plan, the full text of which is set forth in Appendix A, includes the following key elements, which are summarized here for convenience and are subject in all respects to the detailed provisions of Appendix A:

(a) Chief Compliance Officer. Jennifer Caulfield shall serve as Respondents' Chief Compliance Officer ("CCO") for the duration of the Compliance Monitoring Period. The CCO shall report directly to the Board of Directors of DEH and shall be responsible for overseeing all aspects of Respondents' compliance with the Federal Power Act, the Commission's regulations, and the applicable rules of MISO, the Southwest Power Pool ("SPP"), and any other Regional Transmission Organization or Independent System Operator in whose markets Respondents participate. In the event of a vacancy in the CCO position, Respondents shall notify Commission Staff within ten (10) business days and shall appoint a replacement CCO within sixty (60) days.

(b) Annual Compliance Training. All trading personnel, including traders, analysts, risk managers, and supervisory personnel with oversight of trading activities, shall complete a minimum of sixteen (16) hours of compliance training per calendar year. Such training shall cover, at a minimum, the anti-manipulation provisions of the Federal Power Act and the Commission's regulations, market rules and tariff requirements, position limits and reporting obligations, and internal compliance policies and procedures.

(c) Quarterly Compliance Audits. Ridgeway Compliance Solutions LLC, under the direction of Dr. Carolyn Whitford, Founder and Managing Director, shall serve as the independent compliance monitor for the duration of the Compliance Monitoring Period. The independent compliance monitor shall conduct quarterly compliance audits of Respondents' trading operations, compliance policies and procedures, and internal controls. The quarterly audit reports shall be submitted to the CCO and to Commission Staff concurrently, in accordance with the schedule set forth in Appendix A.

(d) Automated Trade Surveillance Systems. Respondents shall implement automated trade surveillance systems designed to detect potential market manipulation patterns, including but not limited to cross-product manipulation, uneconomic trading, and anomalous bidding behavior, in the MISO and SPP wholesale electricity markets. The trade surveillance systems shall be operational no later than ninety (90) days after the Effective Date and shall be subject to review and validation by the independent compliance monitor.

(e) Quarterly Reports to Commission Staff. Respondents shall submit quarterly written reports to the Commission's Office of Enforcement for the duration of the Compliance Monitoring Period. Such reports shall describe Respondents' compliance activities, the results of the independent compliance monitor's quarterly audits, any compliance incidents or potential violations identified during the reporting period, and any corrective actions taken. The quarterly reports shall be submitted within thirty (30) days after the close of each calendar quarter.

(f) Annual CEO/CCO Certification. On an annual basis during the Compliance Monitoring Period, the Chief Executive Officer of DEH (currently Gavin Harcourt) and the Chief Compliance Officer (currently Jennifer Caulfield) shall each execute a written certification confirming that, to the best of their knowledge and belief, Respondents have complied with all material provisions of this Agreement and the Compliance Plan during the preceding twelve-month period, or identifying any areas of non-compliance and describing the corrective actions taken.

(g) Trading Desk Oversight, FTR Position Monitoring, and Cross-Product Transaction Review. The Compliance Plan shall include detailed policies and procedures for trading desk oversight, including real-time monitoring of FTR position exposure, daily review of cross-product transaction activity, and pre-trade approval protocols for virtual transactions exceeding specified notional thresholds. The specific thresholds and approval procedures are set forth in Appendix A.

> [MARGINAL NOTE — C. Bloom, 1/26/2024]: Cross-reference Appendix A for detailed provisions. Confirm that the independent monitor's quarterly audit reports will be submitted to FERC OE concurrently with Respondents' quarterly reports — this was agreed during the January 24 session. Also confirm that Dr. Whitford at Ridgeway is acceptable to FERC Staff as the independent monitor. Christine Pham indicated informally that Staff had no objection but I want written confirmation.

C.3. Modification of Compliance Plan.

28. Respondents may seek modification of the Compliance Plan upon written request submitted to Commission Staff describing the proposed modification and the reasons therefor. Any modification of the Compliance Plan shall be subject to the prior written approval of Commission Staff, which approval shall not be unreasonably withheld, conditioned, or delayed. In the event that Commission Staff does not respond to a written request for modification within forty-five (45) days of receipt, the proposed modification shall be deemed approved.

> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: I have added the "shall not be unreasonably withheld" language — this gives us flexibility if implementation logistics require adjustments during the 36-month monitoring period. Also added the deemed-approval provision for non-response. Confirm with Christine Pham that Staff accepts both additions. If Staff objects to the deemed-approval provision, we can extend the response period to sixty (60) days as a compromise.

D. Neither Admit Nor Deny

29. Respondents neither admit nor deny the allegations, findings, or conclusions described in this Agreement or in FERC Staff's Preliminary Findings letter dated October 2, 2023, or in any other document, communication, or submission by Commission Staff in connection with the investigation in Docket No. IN23-7-000. Nothing in this Agreement shall be construed as an admission of any violation of the Federal Power Act, the Commission's regulations, or any other law, regulation, tariff, or market rule by Respondents or any of their officers, directors, employees, agents, or affiliates.

30. Respondents consent to the Commission's use of this Agreement and the findings and recitals herein solely for purposes of this proceeding, Docket No. IN23-7-000, and any proceeding to enforce the terms of this Agreement. This Agreement shall not be used against Respondents as the basis for any finding of violation, or as evidence of any admission or acknowledgment of wrongdoing, in any other proceeding before the Commission, any federal or state court, or any other regulatory body, except as necessary to enforce the terms of this Agreement.

31. The Parties acknowledge that this Agreement is entered into for the sole purpose of resolving the matters described herein and is not intended to, and shall not, establish any precedent or standard applicable to any other proceeding, investigation, or enforcement action.

> [MARGINAL NOTE — C. Bloom, 1/26/2024]: Reiterate — this is the single most important protective provision for the Respondents. I have strengthened the language as follows: (i) added "or any of their officers, directors, employees, agents, or affiliates" to paragraph 29; (ii) added "or as evidence of any admission or acknowledgment of wrongdoing" to paragraph 30; and (iii) added paragraph 31, which is a no-precedent provision. Confirm with Christine Pham that Staff accepts these additions. If Staff pushes back on paragraph 31, we should resist — this is a standard protective provision in FERC consent agreements. See Docket No. IN21-11-000 (Cascade Grid Partners), paragraph 35.

E. Cooperation Commitment

32. Respondents agree to continue cooperating with the Commission's Office of Enforcement in connection with any related investigations or proceedings arising from the same facts and circumstances as those investigated in Docket No. IN23-7-000. Such cooperation shall include, upon reasonable request by Commission Staff and upon reasonable notice:

(a) Making current employees available for interviews and investigative testimony, at mutually agreeable times and locations;

(b) Producing documents and records reasonably related to the matters investigated in this docket; and

33. The cooperation obligations set forth in this Section III.E shall continue for the duration of the Compliance Monitoring Period. Nothing in this Section shall be construed to require Respondents to waive any applicable privilege, including the attorney-client privilege and the work product doctrine, or to produce materials protected by such privileges.

> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: I have limited the scope of the cooperation commitment to "related investigations arising from the same facts and circumstances as those investigated in Docket No. IN23-7-000." We do not want this to become an open-ended cooperation obligation that could be invoked in connection with wholly unrelated investigations. Also added the privilege carve-out in paragraph 33 — this is essential. Confirm with Christine Pham that the scope limitation is acceptable.

F. Waivers.

F.1. Waiver of Rights to Hearing.

34. Respondents waive their right to a hearing before an Administrative Law Judge on the matters addressed in this Agreement, including any hearing that might otherwise be available under Section 31(d) of the Federal Power Act, 16 U.S.C. § 823b(d), or under the Commission's Rules of Practice and Procedure.

35. Respondents waive their right to seek rehearing of any Commission order approving this Agreement that is consistent with the terms set forth herein, pursuant to Section 313(a) of the Federal Power Act, 16 U.S.C. § 825l(a). Respondents further waive their right to seek judicial review of any such order in any federal court of appeals or any other court.

F.2. Staff Waivers.

36. In consideration of Respondents' agreement to the terms and conditions set forth in this Agreement, FERC Staff waives the right to pursue any further civil penalty claims, disgorgement claims, or other enforcement actions against Respondents arising from or relating to the conduct described in this Agreement during the Relevant Period (January 3, 2022 through March 17, 2023). This waiver extends to DEH, DPT, and their respective current and former officers, directors, and employees acting in their capacity as such in connection with the conduct described herein, including without limitation Kyle Renfro, Anastasia Petrov, and Derek Sung.

> [MARGINAL NOTE — C. Bloom, 1/26/2024]: CRITICAL — Ensure Staff's waiver is comprehensive and covers both DEH and DPT, as well as their officers, directors, and employees acting in their capacity as such. I have added the named individuals (Kyle Renfro, Anastasia Petrov, Derek Sung) who were the primary trading desk personnel involved in the conduct at issue. This is essential — FERC Staff's Preliminary Findings letter identified these individuals by name, and they could potentially be subject to individual enforcement actions absent this release. We may want to add additional trading desk personnel: Marcus Webb, Sarah Okafor, and Jonathan Trask were also identified in Staff's data requests. Consider adding "and other individuals acting in their capacity as officers, directors, or employees of Respondents."

> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: Query whether FERC Staff will agree to extend the release to Dunmore Midstream Partners LP given that the investigation examined coordination with DMP's gas scheduling activity. DMP is referenced in paragraph 6(c) of the Recitals. If FERC Staff takes the position that DMP's conduct is beyond the scope of this Agreement, we need to assess whether DMP faces any standalone exposure. Raise with Christine Pham at the next call. Also confirm whether the waiver extends to potential Section 316A penalty actions against named individuals in their personal capacity — the current formulation ("acting in their capacity as such") may not cover personal-capacity claims.

G. Effect of Agreement

37. This Agreement resolves all claims by FERC Staff against Respondents arising from or relating to the conduct described in this Agreement during the Relevant Period. Upon the Effective Date, the non-public investigation in Docket No. IN23-7-000 shall be closed with respect to the Respondents named herein, subject to the terms and conditions of this Agreement, including the Compliance Monitoring Period and the cooperation commitment set forth in Section III.E.

38. This Agreement does not resolve, and shall not be construed to resolve or preclude, any claims, actions, or proceedings that may be brought by any other federal or state regulatory agency, any law enforcement authority, any Regional Transmission Organization or Independent System Operator, or any private party arising from or relating to the conduct described herein or any other conduct by Respondents. Nothing in this Agreement shall be construed as a determination by any agency other than the Commission regarding the lawfulness or propriety of Respondents' conduct.

> [MARGINAL NOTE — C. Bloom, 1/26/2024]: Standard limitation — this only binds FERC Staff, not other agencies (e.g., DOJ, CFTC, state attorneys general). Note for client awareness in the board memo. MISO's Market Monitoring obligations are separate and MISO may independently refer matters to other agencies. However, we have no indication that any other agency is investigating DPT's trading activity at this time.

H. Binding Effect and Successors

39. This Agreement shall be binding upon Respondents and their respective successors, assigns, and transferees. In the event of any corporate reorganization, merger, acquisition, change of control, or similar transaction involving DEH or DPT (a "Change of Control"), Respondents shall provide written notice to Commission Staff at least thirty (30) calendar days prior to the effective date of such transaction. For purposes of this Agreement, "Change of Control" means (i) the acquisition by any person or group of persons, directly or indirectly, of more than fifty percent (50%) of the voting equity interests in DEH or DPT, or (ii) any merger, consolidation, or other business combination transaction in which DEH or DPT is not the surviving entity, or (iii) any sale or transfer of all or substantially all of the assets of DEH or DPT.

40. Any successor, assign, or transferee of Respondents shall be bound by the terms and conditions of this Agreement to the same extent as Respondents, and Respondents shall ensure that the terms of this Agreement are incorporated into any transaction or agreement effecting a Change of Control.

> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: Confirm this is acceptable to Pendleton Capital Partners (27% equity holder in DEH) and Greenvale Infrastructure Fund III (19% equity holder in DEH). Any potential exit or secondary sale by institutional investors should not trigger the Change of Control notice requirement. I have defined "Change of Control" to require acquisition of more than 50% voting equity, which should address this concern. A secondary sale by Pendleton or Greenvale of their minority stakes would not trigger the notice requirement under this definition. Confirm with Martin Llewellyn.

I. Breach and Remedies

41. In the event that Commission Staff reasonably determines that Respondents have breached any material term or condition of this Agreement, including any provision of the Compliance Plan, Commission Staff shall provide Respondents with written notice specifying the nature of the alleged breach in reasonable detail (a "Breach Notice").

42. Respondents shall have thirty (30) calendar days from receipt of a Breach Notice to cure the alleged breach to the reasonable satisfaction of Commission Staff (the "Cure Period"). Minor or inadvertent deviations from the Compliance Plan that are promptly identified and corrected by Respondents shall not constitute a material breach of this Agreement.

43. If Respondents fail to cure the alleged breach within the Cure Period, or if the breach is not reasonably susceptible to cure, Commission Staff may, in its discretion:

(a) Seek to enforce the terms of this Agreement before the Commission;

(b) Seek additional civil penalties from the Commission for the breach of this Agreement; and/or

(c) Petition the Commission to reopen the investigation in Docket No. IN23-7-000 with respect to the underlying conduct described in Section II of this Agreement.

44. Nothing in this Section III.I shall limit or restrict any other rights or remedies available to Commission Staff under the Federal Power Act, the Commission's regulations, or applicable law.

> [MARGINAL NOTE — C. Bloom, 1/26/2024]: I have added the cure period (paragraph 42) and the "minor or inadvertent deviations" carve-out. These are important protections — without the cure period, a technical compliance hiccup (e.g., a late quarterly report) could theoretically trigger reopening of the entire investigation. The "minor or inadvertent" language appears in the Cascade Grid Partners consent agreement (Docket No. IN21-11-000) and should be acceptable to Staff. Confirm with Christine Pham.

J. Confidentiality.

45. The terms of this Agreement, once approved by the Commission, shall be public and shall be published in accordance with the Commission's customary practice for consent agreements and stipulations approved by Commission order.

46. The underlying investigative record, including all documents produced by Respondents during the investigation, transcripts of investigative testimony, Commission Staff's work papers and analysis, and all communications between the Parties during the investigation and settlement negotiations, shall remain non-public and confidential and shall be subject to the protections of 18 C.F.R. § 1b.9 and any other applicable provisions of the Commission's regulations regarding the confidentiality of enforcement investigations. Neither the Commission nor Commission Staff shall publicly disclose any portion of the non-public investigative record except as required by law or as necessary to enforce the terms of this Agreement.

> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: Confirm that the Commission order approving the Agreement will be published but the investigative file remains non-public per Part 1b. This is standard treatment. The consent agreement itself will be appended to the Commission's public order. The investigative record (including the 187,000 documents produced, testimony transcripts, and Staff's Preliminary Findings letter) remains non-public. Note: if the consent agreement is approved, the Commission's order will typically include a summary of the allegations and the terms of the settlement, but not the full investigative record.

K. Governing Law

47. This Agreement shall be governed by and construed in accordance with federal law, including the Federal Power Act, 16 U.S.C. §§ 791a et seq., and the regulations of the Commission promulgated thereunder.

L. Entire Agreement

48. This Agreement, together with Appendix A (Enhanced Compliance Plan), which is attached hereto and incorporated herein by reference, constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations, and discussions, whether oral or written, between the Parties relating to the subject matter hereof.

49. No amendment, modification, or waiver of any provision of this Agreement shall be effective unless set forth in a writing signed by all Parties or their duly authorized representatives.

M. Counterparts.

50. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. Facsimile and electronic signatures, including signatures transmitted in Portable Document Format (PDF) by electronic mail, shall be deemed original signatures for all purposes.

IV. SIGNATURE BLOCKS

IN WITNESS WHEREOF, the Parties have executed this Stipulation and Consent Agreement as of the dates set forth below.

FOR THE STAFF OF THE OFFICE OF ENFORCEMENT OF THE FEDERAL ENERGY REGULATORY COMMISSION:

By: ________

Name: Christine Pham

Title: Senior Attorney, Division of Investigations

Office of Enforcement Federal Energy Regulatory Commission 888 First Street NE Washington, D.C. 20426

Date: ________

> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: Confirm whether Margaret Hollowell (Director, Division of Investigations) needs to sign as well, or whether Christine Pham's signature alone is sufficient for Staff. In the Vitanova Trading consent agreement (Docket No. IN22-4-000), both the lead attorney and the Division Director signed. In the Cascade Grid Partners consent agreement (Docket No. IN21-11-000), only the lead attorney signed. Ask Christine Pham to confirm the appropriate signatory protocol.

FOR DUNMORE ENERGY HOLDINGS LTD.:

By: ________

Name: Martin Llewellyn

Title: General Counsel

Dunmore Energy Holdings Ltd. 2200 Post Oak Boulevard, Suite 3100 Houston, Texas 77056

Date: ________

> [MARGINAL NOTE — C. Bloom, 1/26/2024]: Confirm with Martin Llewellyn whether Gavin Harcourt (as CEO) or the Board of Directors also needs to authorize execution. Given the penalty amount ($4.75 million), this likely requires Board resolution under DEH's organizational documents (specifically, the Amended and Restated Articles of Association, Section 7.4(c), which requires Board approval for settlements and litigation expenditures exceeding $2.5 million). Coordinate with Martin to ensure a Board resolution authorizing execution of the Agreement is obtained prior to the target execution date of January 31, 2024. Draft Board resolution for Martin's review.

FOR DUNMORE POWER TRADING LLC:

By: ________

Name: Martin Llewellyn

Title: Authorized Representative

Dunmore Power Trading LLC 2200 Post Oak Boulevard, Suite 3100 Houston, Texas 77056

Date: ________

> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: DPT is a wholly owned subsidiary of DEH — confirm that Martin Llewellyn has authority to sign for DPT as well, or whether separate authorization from DPT's managing member (DEH) is required. Review DPT's LLC Agreement (Section 3.2, Manager Authority). Alternative: Derek Sung, SVP of DPT, could sign for DPT if Martin is only authorized to sign for DEH. Confirm organizational authority with Martin by end of week.

APPROVED AS TO FORM — COUNSEL FOR RESPONDENTS:

By: ________

Name: Catherine Bloom

Title: Partner

Calderwood & Harkness LLP 1001 Fannin Street, Suite 4200 Houston, Texas 77002

Date: ________

V. APPENDIX A — ENHANCED COMPLIANCE PLAN

Cross-Reference and Summary

Appendix A to this Stipulation and Consent Agreement is the Enhanced Compliance Plan, which is a separate document prepared in coordination with Ridgeway Compliance Solutions LLC and is incorporated by reference into this Agreement. The Enhanced Compliance Plan is attached hereto and made a part hereof for all purposes.

The Enhanced Compliance Plan includes the following key provisions, which are summarized below for reference. In the event of any inconsistency between this summary and the detailed provisions of Appendix A, the provisions of Appendix A shall control.

(a) Duration. The Compliance Monitoring Period shall be thirty-six (36) months from the Effective Date, ending approximately February 9, 2027, based on the anticipated Effective Date.

(b) Chief Compliance Officer. Jennifer Caulfield shall serve as Respondents' Chief Compliance Officer, reporting directly to the Board of Directors of DEH.

(c) Annual Compliance Training. All trading personnel shall complete a minimum of sixteen (16) hours of compliance training per calendar year, covering the anti-manipulation provisions of the Federal Power Act and the Commission's regulations, market rules and tariff requirements, and internal compliance policies and procedures.

(d) Quarterly Compliance Audits. Ridgeway Compliance Solutions LLC, under the direction of Dr. Carolyn Whitford, Founder and Managing Director, shall conduct quarterly compliance audits of Respondents' trading operations and submit audit reports to the Chief Compliance Officer and Commission Staff concurrently.

(e) Automated Trade Surveillance Systems. Respondents shall implement and maintain automated trade surveillance systems designed to detect potential market manipulation patterns in the MISO and SPP wholesale electricity markets.

(f) Quarterly FERC OE Reporting. Respondents shall submit quarterly written reports to the Commission's Office of Enforcement for the duration of the Compliance Monitoring Period.

(g) Annual CEO/CCO Certification. The Chief Executive Officer (Gavin Harcourt) and the Chief Compliance Officer (Jennifer Caulfield) shall each execute an annual written certification of compliance.

> [MARGINAL NOTE — C. Bloom, 1/26/2024]: Final Appendix A will be the Enhanced Compliance Plan document prepared separately by C&H in coordination with Ridgeway Compliance Solutions. Current working draft of Appendix A is dated January 19, 2024 (v.3). Ensure consistency between this cross-reference summary and the final compliance plan. Hannah — please run a comparison of this summary against the January 19 draft of Appendix A and flag any inconsistencies before we circulate to FERC Staff. Target: attach final Appendix A to the executed Agreement by January 31, 2024.

VI. C&H INTERNAL ANNOTATIONS AND REVIEW NOTES

[INTERNAL — NOT FOR DISTRIBUTION TO FERC STAFF]

> [OVERALL ASSESSMENT — Catherine Bloom, Partner, Calderwood & Harkness LLP, 1/26/2024]: > > This draft reflects the terms agreed on January 24, 2024: > > - Civil penalty: $4.75 million (paid in two installments) > - Disgorgement: waived entirely > - Compliance plan: 36-month Enhanced Compliance Plan with independent monitor > - Neither admit nor deny: comprehensive protective provision > > Total monetary resolution: $4,750,000. This represents a reduction of approximately $26,050,000 (84.6%) from FERC Staff's initial demand of $30,800,000 (consisting of $18.0 million civil penalty + $12.8 million disgorgement). > > Key open items: > > 1. Confirm FERC Staff accepts our proposed "neither admit nor deny" formulation, including the additions to paragraphs 29–31. > 2. Confirm scope of Staff waiver re: named individuals (Kyle Renfro, Anastasia Petrov, Derek Sung) and whether the waiver extends to Dunmore Midstream Partners LP. > 3. Confirm cure-period language in breach provision (paragraph 42) and "minor or inadvertent deviations" carve-out. > 4. Confirm Staff accepts "shall not be unreasonably withheld" language in compliance plan modification provision (paragraph 28). > 5. Coordinate Board authorization with Martin Llewellyn — Board resolution required for settlement exceeding $2.5 million per DEH Articles of Association, Section 7.4(c). > 6. Finalize Appendix A (Enhanced Compliance Plan) — current working draft v.3 dated January 19, 2024. > > Target execution date: January 31, 2024. > Anticipated FERC order: early February 2024 (estimated February 9, 2024).

> [CIRCULATION PLAN — Hannah Brinkley, Associate, Calderwood & Harkness LLP, 1/26/2024]: > > Proposed next steps: > > 1. Internal review complete by COB Monday, January 29, 2024. > 2. Send clean and redline versions to Christine Pham (FERC Staff) on Tuesday, January 30, 2024. > 3. Copy Martin Llewellyn (Dunmore General Counsel) on all correspondence with Staff. > 4. Copy Alan Ngo (C&H billing department) for billing purposes — Matter No. 1016-00004. > 5. Flag for Catherine Bloom: schedule call with Christine Pham for January 30 or 31 to discuss open items identified above.

CONFIDENTIAL — ATTORNEY WORK PRODUCT — ATTORNEY-CLIENT PRIVILEGED COMMUNICATION Calderwood & Harkness LLP

In the Matter of

Dunmore Energy Holdings Ltd.

and

Dunmore Power Trading LLC

PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT ATTORNEY-CLIENT PRIVILEGED COMMUNICATION
[C&H MARKED DRAFT — FOR INTERNAL REVIEW] Reviewed by C. Bloom and H. Brinkley — January 26, 2024 C&H Matter Number: 1016-00004 C&H Billing Code: 71420.00001
UNITED STATES OF AMERICA BEFORE THE FEDERAL ENERGY REGULATORY COMMISSION
DRAFT — STIPULATION AND CONSENT AGREEMENT
> [MARGINAL NOTE — C. Bloom, 1/26/2024]: This draft reflects the agreed terms from the January 24, 2024 negotiations with FERC Staff (Christine Pham) and incorporates C&H's proposed language revisions for FERC Staff review. All tracked changes reflect C&H's proposed modifications to the working draft exchanged during the January 24 settlement conference. Open items are flagged in marginal comments throughout. Please review and return comments by COB Monday, January 29, 2024.
I. CAPTION AND INTRODUCTORY PARAGRAPH
UNITED STATES OF AMERICA BEFORE THE FEDERAL ENERGY REGULATORY COMMISSION
In the Matter of Dunmore Energy Holdings Ltd. and Dunmore Power Trading LLC
Docket No. IN23-7-000
STIPULATION AND CONSENT AGREEMENT
The Staff of the Office of Enforcement of the Federal Energy Regulatory Commission ("Commission Staff" or "FERC Staff"), Dunmore Energy Holdings Ltd. ("DEH"), an exempted company incorporated under the laws of the Cayman Islands, with its registered office at 4th Floor, Harbour Place, 103 South Church Street, George Town, Grand Cayman, KY1-1002, Cayman Islands, and its principal United States office at 2200 Post Oak Boulevard, Suite 3100, Houston, Texas 77056 (EIN: 98-1347562), and Dunmore Power Trading LLC ("DPT"), a Delaware limited liability company, with its principal office at 2200 Post Oak Boulevard, Suite 3100, Houston, Texas 77056 (EIN: 82-4519763), with its registered agent at Capitol Registered Agents Inc., 1209 Orange Street, Wilmington, Delaware 19801 (DEH and DPT collectively referred to herein as "Respondents"), hereby enter into this Stipulation and Consent Agreement ("Agreement") to resolve the matters set forth herein, pursuant to the Commission's Rules of Practice and Procedure and the Commission's Revised Policy Statement on Enforcement.
> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: Confirm FERC Staff's preferred formulation for the party identifications. Staff sometimes prefers "Commission Staff" over "FERC Staff" throughout the body of the agreement. In recent consent agreements (e.g., Docket No. IN22-4-000, Vitanova Trading), Staff used "Commission Staff" as the primary defined term. Recommend using "Commission Staff" as the primary reference and "FERC Staff" only as a secondary parenthetical. Adjust throughout if Staff objects.
Commission Staff and Respondents are collectively referred to herein as the "Parties." The Parties enter into this Agreement voluntarily and without any party being under duress or compulsion. This Agreement is contingent upon approval by the Commission and shall become effective upon the date of the Commission's order approving this Agreement in its entirety and without material modification (the "Effective Date").
II. RECITALS
WHEREAS, the following recitals set forth the background facts and circumstances relevant to this Agreement:
A. Background of the Investigation
1.  DPT holds market-based rate authority from the Commission, granted under Docket No. ER05-1128-000, pursuant to which DPT has been authorized to sell electric energy, capacity, and ancillary services at market-based rates, and has been an active participant in the wholesale electricity markets administered by the Midcontinent Independent System Operator, Inc. ("MISO") since approximately 2006.
2.  On or about April 3, 2023, Velthorn Market Analytics, Inc., serving as the Independent Market Monitor ("IMM") for MISO, submitted a referral letter to the Commission's Office of Enforcement identifying certain bidding patterns by DPT in MISO's Day-Ahead and Real-Time energy markets. The IMM referral described anomalous trading patterns observed at certain pricing nodes and raised questions regarding the economic rationale underlying certain generation offers and virtual transactions submitted by DPT during calendar years 2022 and 2023.
3.  Following receipt of the IMM referral, on May 22, 2023, the Commission's Office of Enforcement issued a preliminary inquiry letter to Dunmore Energy Holdings Ltd. requesting information and documents relating to DPT's trading activity in the MISO markets during the period identified in the IMM referral.
4.  On June 12, 2023, the Commission's Office of Enforcement issued a formal non-public order of investigation in this docket, Docket No. IN23-7-000, pursuant to 18 C.F.R. Part 1b, authorizing Commission Staff to investigate whether DPT's trading activity in the MISO Day-Ahead and Real-Time energy markets during the period at issue may have violated Section 222 of the Federal Power Act, 16 U.S.C. § 824v, and the Commission's Anti-Manipulation Rule, 18 C.F.R. § 1c.2.
> [MARGINAL NOTE — C. Bloom, 1/26/2024]: Propose softening language in this recital. Suggest: "the Office of Enforcement commenced an investigation into certain trading activity by DPT" rather than adopting FERC's characterization of the trading as "potentially manipulative." The current formulation in paragraph 4 ("may have violated") is acceptable, but we should avoid any stronger characterization. The recital should reflect a neutral description of the procedural history without endorsing the substance of the allegations.
B. Allegations Under Investigation
5.  FERC Staff has alleged that during the period from January 3, 2022 through March 17, 2023 (the "Relevant Period"), DPT engaged in trading activity in the MISO Day-Ahead and Real-Time energy markets at the Indiana Hub and Minnesota Hub pricing nodes that may have constituted a violation of Section 222 of the Federal Power Act, 16 U.S.C. § 824v, and the Commission's Anti-Manipulation Rule, 18 C.F.R. § 1c.2.
6.  Specifically, FERC Staff has alleged that DPT engaged in the following three categories of conduct during the Relevant Period:
(a) Uneconomic Day-Ahead Generation Offers at Indiana Hub. FERC Staff has alleged that DPT submitted Day-Ahead offers for gas-fired generation units at the Indiana Hub at prices significantly below marginal cost, including offers at price levels as low as negative fifteen dollars per megawatt-hour (-$15/MWh) to negative forty dollars per megawatt-hour (-$40/MWh), allegedly for the purpose of creating artificial congestion patterns in the Day-Ahead market while DPT simultaneously held Financial Transmission Rights ("FTRs") that would benefit from the resulting congestion. FERC Staff has alleged that DPT's generation offers were not economically rational when viewed in isolation from DPT's FTR portfolio, and that the purpose and intended effect of the offers was to move congestion patterns in a manner that would increase the value of DPT's FTR positions.
(b) Cross-Product Virtual Transactions at Minnesota Hub. FERC Staff has alleged that DPT submitted cross-product virtual transactions, including Increment Offers ("INCs") and Decrement Bids ("DECs"), at the Minnesota Hub pricing node that were allegedly designed to amplify congestion differentials between the Indiana Hub and the Minnesota Hub. FERC Staff has alleged that these virtual transactions lacked independent economic rationale and were coordinated with DPT's generation offers and FTR positions to maximize the value of DPT's overall portfolio at the expense of market integrity.
(c) Alleged Coordination of Gas Nominations. FERC Staff has alleged that DPT coordinated gas nominations through an affiliated entity, Dunmore Midstream Partners LP ("DMP") (EIN: 47-8831205), to support the uneconomic generation offers described above. FERC Staff has alleged that DMP's gas scheduling activity during certain periods of the Relevant Period was timed and structured to ensure that DPT's gas-fired generation units at the Indiana Hub could operate at the below-cost offer levels submitted in the Day-Ahead market, thereby facilitating the alleged scheme.
> [MARGINAL NOTE — C. Bloom, 1/26/2024]: This recital should use "FERC Staff alleged" or "FERC Staff has alleged" language consistently throughout — I have revised accordingly. We need to ensure nothing here could be read as an admission by Respondents. Every sentence describing the conduct must be framed as an allegation of Staff, not as a stipulated fact. I propose the following additional sentence at the end of paragraph 6: "Respondents dispute these allegations and deny that any of the trading activity described herein constituted a violation of the Federal Power Act or the Commission's regulations."
> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: Check that the description of the alleged conduct tracks the Preliminary Findings letter of October 2, 2023 without embellishing. Do not include FERC Staff's characterizations beyond what is necessary for context. The current draft pulls language from paragraphs 14–38 of the Preliminary Findings letter. Confirm that the FTR-related allegations (paragraph 6(a)) do not incorporate any of the characterizations from Christine Pham's January 10, 2024 email, which went beyond the Preliminary Findings letter.
C. Volume and Scope of Alleged Conduct
7.  FERC Staff has estimated that DPT's trading activity during the Relevant Period that is the subject of the allegations described in Section II.B above included:
(a) Total Day-Ahead generation offers at issue of approximately 2,840 gigawatt-hours (GWh) over the Relevant Period;
(b) FTR positions with a notional value of approximately Forty-Seven Million Three Hundred Thousand Dollars ($47,300,000); and
(c) Virtual transactions at the Minnesota Hub of approximately 1,620 gigawatt-hours (GWh).
> [MARGINAL NOTE — C. Bloom, 1/26/2024]: Propose adding an express qualifier: "FERC Staff estimated that…" — these are Staff's figures, not agreed-upon facts. Our own analysis (Dr. Andrew Whitfield, Meridian Economic Consulting) calculated significantly lower volumes for categories (a) and (c). However, for purposes of settlement, we need not contest Staff's figures in the recitals as long as they are clearly attributed to Staff. Confirm with the client that the recitation of these figures in the consent agreement will not create issues for DPT's market-based rate filings or MISO market participation going forward.
D. Respondents' Cooperation
8.  Respondents cooperated fully and in good faith with the Commission's Office of Enforcement throughout the investigation, including:
(a) Production of approximately one hundred eighty-seven thousand (187,000) documents, comprising approximately 1.24 million pages, collected from eleven (11) custodians within Respondents' organizations;
(b) Making six (6) employees available for investigative testimony under 18 C.F.R. § 1b.12, including members of DPT's trading desk, risk management, and compliance functions;
(c) Providing detailed narrative responses to two sets of data requests from Commission Staff, consisting of forty-one (41) interrogatories and twenty-three (23) document requests in the first set, and eighteen (18) supplemental interrogatories in the second set; and
(d) Responding to all requests from Commission Staff in a timely and complete manner throughout the investigation.
9.  Respondents retained outside counsel, Calderwood & Harkness LLP, to assist in responding to the investigation, and through outside counsel, maintained regular and constructive communications with Commission Staff throughout the pendency of the investigation. Respondents provided timely responses to all data requests and did not seek to delay or obstruct the investigative process.
E. Respondents' Remedial Measures
10.  DEH appointed Jennifer Caulfield as Chief Compliance Officer on February 6, 2023, prior to the commencement of the investigation in this docket. Ms. Caulfield reports directly to the Board of Directors of DEH and has been vested with authority and resources to oversee Respondents' compliance with the Federal Power Act, the Commission's regulations, and applicable market rules.
11.  In connection with the investigation and the settlement negotiations described herein, Respondents retained Ridgeway Compliance Solutions LLC, an independent compliance consulting firm, to serve as an independent compliance consultant and monitor with respect to Respondents' wholesale electricity trading operations. Ridgeway Compliance Solutions LLC, under the direction of Dr. Carolyn Whitford, Founder and Managing Director, has undertaken a comprehensive review of Respondents' compliance policies and procedures and has made recommendations for enhancements, which have been incorporated into the Enhanced Compliance Plan described in Section III.C and attached as Appendix A to this Agreement.
12.  Respondents have committed to the adoption and implementation of the Enhanced Compliance Plan attached as Appendix A hereto, which sets forth comprehensive compliance measures designed to prevent, detect, and deter potential violations of the Federal Power Act and the Commission's regulations.
F. Settlement Negotiations
13.  Following the issuance of FERC Staff's Preliminary Findings letter on October 2, 2023, and Respondents' Response to Preliminary Findings submitted on November 6, 2023, the Parties engaged in settlement negotiations with the goal of reaching a consensual resolution of the matters under investigation in this docket.
14.  The Parties conducted settlement conferences on December 5, 2023, January 8, 2024, and January 24, 2024, and exchanged written settlement proposals and counterproposals during the period from November 2023 through January 2024.
15.  The Parties have reached an agreement on the terms and conditions set forth herein in the interest of resolving this matter efficiently and without the need for further administrative proceedings, including without the need for a hearing before an Administrative Law Judge, the assessment of additional civil penalties by the Commission, or further litigation of the matters at issue. The Parties believe that the terms of this Agreement are fair, reasonable, and in the public interest.
> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: Standard FERC settlement recital language. Confirm this tracks recent consent agreements in analogous manipulation cases — compare Docket No. IN22-4-000 (Vitanova Trading, approved Dec. 2023) and Docket No. IN21-11-000 (Cascade Grid Partners, approved Sept. 2023). The "fair, reasonable, and in the public interest" formulation is the Commission's standard for approval of consent agreements.
G. Neither Admit Nor Deny
16.  Respondents neither admit nor deny the allegations, findings, or conclusions described in this Agreement or in FERC Staff's Preliminary Findings letter dated October 2, 2023, or in any other document or communication issued by Commission Staff in connection with the investigation in Docket No. IN23-7-000. Respondents enter into this Agreement solely for the purpose of resolving the matters addressed herein, and this Agreement shall not be construed as an admission of any violation of the Federal Power Act, the Commission's regulations, or any other law or regulation by Respondents or any of their officers, directors, employees, or affiliates.
17.  This Agreement shall not be used as the basis for any finding of violation of the Federal Power Act or the Commission's regulations in any other proceeding, except in a proceeding to enforce the terms of this Agreement. Respondents consent to the use of this Agreement solely for purposes of assessing compliance with its terms and conditions and for any proceeding in which the Commission or Commission Staff seeks to enforce the terms of this Agreement.
> [MARGINAL NOTE — C. Bloom, 1/26/2024]: CRITICAL — This is the "neither admit nor deny" provision. Ensure language precisely mirrors recent FERC consent agreements. I have added the phrase "or any of their officers, directors, employees, or affiliates" to paragraph 16 and the sentence regarding non-use in any other proceeding in paragraph 17. Propose further addition: "Nothing in this Agreement shall be construed as an admission of any violation of the Federal Power Act, the Commission's regulations, or any other law or regulation." This language appears in the Vitanova consent agreement and should be included here. Confirm with Christine Pham that Staff accepts this formulation.
III. TERMS AND CONDITIONS
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual agreements, representations, and commitments set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
A. Civil Penalty
A.1. Penalty Amount.  
18.  Respondents shall pay a civil penalty in the total amount of Four Million Seven Hundred Fifty Thousand Dollars ($4,750,000.00) to the United States Treasury, pursuant to Section 316A of the Federal Power Act, 16 U.S.C. § 825o-1. DEH and DPT shall be jointly and severally liable for the payment of the full amount of the civil penalty.
> [MARGINAL NOTE — C. Bloom, 1/26/2024]: Confirm payment is to the U.S. Treasury, not to FERC directly — this is the standard formulation under Section 316A of the Federal Power Act. Payment is made by wire transfer to the U.S. Treasury's account per FERC Staff's instructions. Joint and several liability language is standard where there are affiliated respondents.
A.2. Payment Schedule.  
19.  The civil penalty shall be paid in two (2) equal installments as follows:
(a) The first installment of Two Million Three Hundred Seventy-Five Thousand Dollars ($2,375,000.00) shall be due and payable within thirty (30) calendar days of the Effective Date (as defined in Section I above).
(b) The second installment of Two Million Three Hundred Seventy-Five Thousand Dollars ($2,375,000.00) shall be due and payable within one hundred eighty (180) calendar days of the Effective Date.
20.  Payment of each installment shall be made by electronic wire transfer to the United States Treasury in accordance with the wire transfer instructions to be provided by Commission Staff. Respondents shall provide written confirmation of each payment to Commission Staff within five (5) business days of each wire transfer.
> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: Based on the anticipated FERC order date of approximately February 9, 2024: first installment due approximately March 10, 2024; second installment due approximately August 7, 2024. Confirm wire transfer instructions and payee details will be provided by FERC Staff prior to each installment date. Propose adding a sentence requiring Staff to provide payment instructions at least ten (10) business days in advance of each installment due date. I have added paragraph 20 to address the confirmation requirement — confirm this is acceptable to Staff.
A.3. Late Payment.  
21.  In the event that Respondents fail to make timely payment of any installment of the civil penalty as required by Section III.A.2, interest shall accrue on the outstanding balance from the due date until the date of payment at the rate established by the Internal Revenue Service for the underpayment of federal income taxes under 26 U.S.C. § 6621(a)(2), as in effect on the date that payment was due. The accrual of interest under this provision shall be in addition to, and not in lieu of, any other remedies available to Commission Staff under this Agreement or applicable law.
> [MARGINAL NOTE — C. Bloom, 1/26/2024]: Standard provision. Confirm current rate reference is correct — 26 U.S.C. § 6621(a)(2) currently provides for the federal short-term rate plus 3 percentage points, adjusted quarterly. This is the standard interest provision in FERC consent agreements.
A.4. No Tax Deductibility Representation.  
22.  Nothing in this Agreement constitutes a representation by any Party regarding the tax deductibility of the civil penalty or any portion thereof. Respondents are solely responsible for determining the tax treatment of the civil penalty in consultation with their own tax advisors and accountants.
> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: Flag for Martin Llewellyn (Dunmore General Counsel) — coordinate with Prescott & Hargrove LLP (Douglas Fenn, CPA) on financial statement treatment and tax implications of the penalty. Under Section 162(f) of the Internal Revenue Code (as amended by the Tax Cuts and Jobs Act), the civil penalty is likely non-deductible. Confirm treatment for financial reporting purposes under ASC 450 (loss contingencies). Separate memo to follow.
B. Disgorgement.  
23.  No disgorgement of profits or revenues shall be required of Respondents under this Agreement.
24.  In consideration of the totality of the circumstances, including Respondents' full and timely cooperation with the investigation, the remedial measures undertaken by Respondents as described in Section II.E above, and the uncertainty inherent in quantifying any unjust profits that may have resulted from the trading activity at issue, FERC Staff has agreed that no disgorgement is warranted in connection with this resolution. This provision reflects a compromise by the Parties and does not constitute a finding or determination by FERC Staff or the Commission that Respondents did or did not earn unjust profits from the trading activity described herein.
> [MARGINAL NOTE — C. Bloom, 1/26/2024]: This was a key negotiation win. FERC Staff's initial demand included $12.8 million in disgorgement. The waiver reflects our arguments (supported by Dr. Andrew Whitfield's economic analysis, Meridian Economic Consulting, showing that the market impact of the trading activity at issue was no more than $2.1 million, and that even this figure was based on a series of contested assumptions regarding counterfactual market outcomes) that unjust profits were speculative and unquantifiable with sufficient certainty to support a disgorgement order. Ensure this provision is clear and unambiguous. Note: the language in paragraph 24 ("uncertainty inherent in quantifying any unjust profits") was specifically negotiated with Christine Pham during the January 24 settlement conference. Do not modify without discussion.
C. Enhanced Compliance Plan
C.1. Adoption and Implementation.  
25.  Respondents shall adopt and implement the Enhanced Compliance Plan attached hereto as Appendix A (the "Compliance Plan") within the timeframes specified therein. The Compliance Plan shall become effective on the Effective Date and shall remain in effect for a period of thirty-six (36) months from the Effective Date (the "Compliance Monitoring Period"), ending approximately February 9, 2027, based on the anticipated Effective Date.
26.  Respondents shall devote such financial, personnel, and organizational resources as are reasonably necessary to ensure full and timely implementation of, and compliance with, the Compliance Plan throughout the Compliance Monitoring Period.
C.2. Key Elements of the Compliance Plan.  
27.  The Compliance Plan, the full text of which is set forth in Appendix A, includes the following key elements, which are summarized here for convenience and are subject in all respects to the detailed provisions of Appendix A:
(a) Chief Compliance Officer. Jennifer Caulfield shall serve as Respondents' Chief Compliance Officer ("CCO") for the duration of the Compliance Monitoring Period. The CCO shall report directly to the Board of Directors of DEH and shall be responsible for overseeing all aspects of Respondents' compliance with the Federal Power Act, the Commission's regulations, and the applicable rules of MISO, the Southwest Power Pool ("SPP"), and any other Regional Transmission Organization or Independent System Operator in whose markets Respondents participate. In the event of a vacancy in the CCO position, Respondents shall notify Commission Staff within ten (10) business days and shall appoint a replacement CCO within sixty (60) days.
(b) Annual Compliance Training. All trading personnel, including traders, analysts, risk managers, and supervisory personnel with oversight of trading activities, shall complete a minimum of sixteen (16) hours of compliance training per calendar year. Such training shall cover, at a minimum, the anti-manipulation provisions of the Federal Power Act and the Commission's regulations, market rules and tariff requirements, position limits and reporting obligations, and internal compliance policies and procedures.
(c) Quarterly Compliance Audits. Ridgeway Compliance Solutions LLC, under the direction of Dr. Carolyn Whitford, Founder and Managing Director, shall serve as the independent compliance monitor for the duration of the Compliance Monitoring Period. The independent compliance monitor shall conduct quarterly compliance audits of Respondents' trading operations, compliance policies and procedures, and internal controls. The quarterly audit reports shall be submitted to the CCO and to Commission Staff concurrently, in accordance with the schedule set forth in Appendix A.
(d) Automated Trade Surveillance Systems. Respondents shall implement automated trade surveillance systems designed to detect potential market manipulation patterns, including but not limited to cross-product manipulation, uneconomic trading, and anomalous bidding behavior, in the MISO and SPP wholesale electricity markets. The trade surveillance systems shall be operational no later than ninety (90) days after the Effective Date and shall be subject to review and validation by the independent compliance monitor.
(e) Quarterly Reports to Commission Staff. Respondents shall submit quarterly written reports to the Commission's Office of Enforcement for the duration of the Compliance Monitoring Period. Such reports shall describe Respondents' compliance activities, the results of the independent compliance monitor's quarterly audits, any compliance incidents or potential violations identified during the reporting period, and any corrective actions taken. The quarterly reports shall be submitted within thirty (30) days after the close of each calendar quarter.
(f) Annual CEO/CCO Certification. On an annual basis during the Compliance Monitoring Period, the Chief Executive Officer of DEH (currently Gavin Harcourt) and the Chief Compliance Officer (currently Jennifer Caulfield) shall each execute a written certification confirming that, to the best of their knowledge and belief, Respondents have complied with all material provisions of this Agreement and the Compliance Plan during the preceding twelve-month period, or identifying any areas of non-compliance and describing the corrective actions taken.
(g) Trading Desk Oversight, FTR Position Monitoring, and Cross-Product Transaction Review. The Compliance Plan shall include detailed policies and procedures for trading desk oversight, including real-time monitoring of FTR position exposure, daily review of cross-product transaction activity, and pre-trade approval protocols for virtual transactions exceeding specified notional thresholds. The specific thresholds and approval procedures are set forth in Appendix A.
> [MARGINAL NOTE — C. Bloom, 1/26/2024]: Cross-reference Appendix A for detailed provisions. Confirm that the independent monitor's quarterly audit reports will be submitted to FERC OE concurrently with Respondents' quarterly reports — this was agreed during the January 24 session. Also confirm that Dr. Whitford at Ridgeway is acceptable to FERC Staff as the independent monitor. Christine Pham indicated informally that Staff had no objection but I want written confirmation.
C.3. Modification of Compliance Plan.  
28.  Respondents may seek modification of the Compliance Plan upon written request submitted to Commission Staff describing the proposed modification and the reasons therefor. Any modification of the Compliance Plan shall be subject to the prior written approval of Commission Staff, which approval shall not be unreasonably withheld, conditioned, or delayed. In the event that Commission Staff does not respond to a written request for modification within forty-five (45) days of receipt, the proposed modification shall be deemed approved.
> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: I have added the "shall not be unreasonably withheld" language — this gives us flexibility if implementation logistics require adjustments during the 36-month monitoring period. Also added the deemed-approval provision for non-response. Confirm with Christine Pham that Staff accepts both additions. If Staff objects to the deemed-approval provision, we can extend the response period to sixty (60) days as a compromise.
D. Neither Admit Nor Deny
29.  Respondents neither admit nor deny the allegations, findings, or conclusions described in this Agreement or in FERC Staff's Preliminary Findings letter dated October 2, 2023, or in any other document, communication, or submission by Commission Staff in connection with the investigation in Docket No. IN23-7-000. Nothing in this Agreement shall be construed as an admission of any violation of the Federal Power Act, the Commission's regulations, or any other law, regulation, tariff, or market rule by Respondents or any of their officers, directors, employees, agents, or affiliates.
30.  Respondents consent to the Commission's use of this Agreement and the findings and recitals herein solely for purposes of this proceeding, Docket No. IN23-7-000, and any proceeding to enforce the terms of this Agreement. This Agreement shall not be used against Respondents as the basis for any finding of violation, or as evidence of any admission or acknowledgment of wrongdoing, in any other proceeding before the Commission, any federal or state court, or any other regulatory body, except as necessary to enforce the terms of this Agreement.
31.  The Parties acknowledge that this Agreement is entered into for the sole purpose of resolving the matters described herein and is not intended to, and shall not, establish any precedent or standard applicable to any other proceeding, investigation, or enforcement action.
> [MARGINAL NOTE — C. Bloom, 1/26/2024]: Reiterate — this is the single most important protective provision for the Respondents. I have strengthened the language as follows: (i) added "or any of their officers, directors, employees, agents, or affiliates" to paragraph 29; (ii) added "or as evidence of any admission or acknowledgment of wrongdoing" to paragraph 30; and (iii) added paragraph 31, which is a no-precedent provision. Confirm with Christine Pham that Staff accepts these additions. If Staff pushes back on paragraph 31, we should resist — this is a standard protective provision in FERC consent agreements. See Docket No. IN21-11-000 (Cascade Grid Partners), paragraph 35.
E. Cooperation Commitment
32.  Respondents agree to continue cooperating with the Commission's Office of Enforcement in connection with any related investigations or proceedings arising from the same facts and circumstances as those investigated in Docket No. IN23-7-000. Such cooperation shall include, upon reasonable request by Commission Staff and upon reasonable notice:
(a) Making current employees available for interviews and investigative testimony, at mutually agreeable times and locations;
(b) Producing documents and records reasonably related to the matters investigated in this docket; and
(c) Providing information, data, and analysis reasonably related to the matters investigated in this docket.
33.  The cooperation obligations set forth in this Section III.E shall continue for the duration of the Compliance Monitoring Period. Nothing in this Section shall be construed to require Respondents to waive any applicable privilege, including the attorney-client privilege and the work product doctrine, or to produce materials protected by such privileges.
> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: I have limited the scope of the cooperation commitment to "related investigations arising from the same facts and circumstances as those investigated in Docket No. IN23-7-000." We do not want this to become an open-ended cooperation obligation that could be invoked in connection with wholly unrelated investigations. Also added the privilege carve-out in paragraph 33 — this is essential. Confirm with Christine Pham that the scope limitation is acceptable.
F. Waivers.  
F.1. Waiver of Rights to Hearing.  
34.  Respondents waive their right to a hearing before an Administrative Law Judge on the matters addressed in this Agreement, including any hearing that might otherwise be available under Section 31(d) of the Federal Power Act, 16 U.S.C. § 823b(d), or under the Commission's Rules of Practice and Procedure.
35.  Respondents waive their right to seek rehearing of any Commission order approving this Agreement that is consistent with the terms set forth herein, pursuant to Section 313(a) of the Federal Power Act, 16 U.S.C. § 825l(a). Respondents further waive their right to seek judicial review of any such order in any federal court of appeals or any other court.
F.2. Staff Waivers.  
36.  In consideration of Respondents' agreement to the terms and conditions set forth in this Agreement, FERC Staff waives the right to pursue any further civil penalty claims, disgorgement claims, or other enforcement actions against Respondents arising from or relating to the conduct described in this Agreement during the Relevant Period (January 3, 2022 through March 17, 2023). This waiver extends to DEH, DPT, and their respective current and former officers, directors, and employees acting in their capacity as such in connection with the conduct described herein, including without limitation Kyle Renfro, Anastasia Petrov, and Derek Sung.
> [MARGINAL NOTE — C. Bloom, 1/26/2024]: CRITICAL — Ensure Staff's waiver is comprehensive and covers both DEH and DPT, as well as their officers, directors, and employees acting in their capacity as such. I have added the named individuals (Kyle Renfro, Anastasia Petrov, Derek Sung) who were the primary trading desk personnel involved in the conduct at issue. This is essential — FERC Staff's Preliminary Findings letter identified these individuals by name, and they could potentially be subject to individual enforcement actions absent this release. We may want to add additional trading desk personnel: Marcus Webb, Sarah Okafor, and Jonathan Trask were also identified in Staff's data requests. Consider adding "and other individuals acting in their capacity as officers, directors, or employees of Respondents."
> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: Query whether FERC Staff will agree to extend the release to Dunmore Midstream Partners LP given that the investigation examined coordination with DMP's gas scheduling activity. DMP is referenced in paragraph 6(c) of the Recitals. If FERC Staff takes the position that DMP's conduct is beyond the scope of this Agreement, we need to assess whether DMP faces any standalone exposure. Raise with Christine Pham at the next call. Also confirm whether the waiver extends to potential Section 316A penalty actions against named individuals in their personal capacity — the current formulation ("acting in their capacity as such") may not cover personal-capacity claims.
G. Effect of Agreement
37.  This Agreement resolves all claims by FERC Staff against Respondents arising from or relating to the conduct described in this Agreement during the Relevant Period. Upon the Effective Date, the non-public investigation in Docket No. IN23-7-000 shall be closed with respect to the Respondents named herein, subject to the terms and conditions of this Agreement, including the Compliance Monitoring Period and the cooperation commitment set forth in Section III.E.
38.  This Agreement does not resolve, and shall not be construed to resolve or preclude, any claims, actions, or proceedings that may be brought by any other federal or state regulatory agency, any law enforcement authority, any Regional Transmission Organization or Independent System Operator, or any private party arising from or relating to the conduct described herein or any other conduct by Respondents. Nothing in this Agreement shall be construed as a determination by any agency other than the Commission regarding the lawfulness or propriety of Respondents' conduct.
> [MARGINAL NOTE — C. Bloom, 1/26/2024]: Standard limitation — this only binds FERC Staff, not other agencies (e.g., DOJ, CFTC, state attorneys general). Note for client awareness in the board memo. MISO's Market Monitoring obligations are separate and MISO may independently refer matters to other agencies. However, we have no indication that any other agency is investigating DPT's trading activity at this time.
H. Binding Effect and Successors
39.  This Agreement shall be binding upon Respondents and their respective successors, assigns, and transferees. In the event of any corporate reorganization, merger, acquisition, change of control, or similar transaction involving DEH or DPT (a "Change of Control"), Respondents shall provide written notice to Commission Staff at least thirty (30) calendar days prior to the effective date of such transaction. For purposes of this Agreement, "Change of Control" means (i) the acquisition by any person or group of persons, directly or indirectly, of more than fifty percent (50%) of the voting equity interests in DEH or DPT, or (ii) any merger, consolidation, or other business combination transaction in which DEH or DPT is not the surviving entity, or (iii) any sale or transfer of all or substantially all of the assets of DEH or DPT.
40.  Any successor, assign, or transferee of Respondents shall be bound by the terms and conditions of this Agreement to the same extent as Respondents, and Respondents shall ensure that the terms of this Agreement are incorporated into any transaction or agreement effecting a Change of Control.
> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: Confirm this is acceptable to Pendleton Capital Partners (27% equity holder in DEH) and Greenvale Infrastructure Fund III (19% equity holder in DEH). Any potential exit or secondary sale by institutional investors should not trigger the Change of Control notice requirement. I have defined "Change of Control" to require acquisition of more than 50% voting equity, which should address this concern. A secondary sale by Pendleton or Greenvale of their minority stakes would not trigger the notice requirement under this definition. Confirm with Martin Llewellyn.
I. Breach and Remedies
41.  In the event that Commission Staff reasonably determines that Respondents have breached any material term or condition of this Agreement, including any provision of the Compliance Plan, Commission Staff shall provide Respondents with written notice specifying the nature of the alleged breach in reasonable detail (a "Breach Notice").
42.  Respondents shall have thirty (30) calendar days from receipt of a Breach Notice to cure the alleged breach to the reasonable satisfaction of Commission Staff (the "Cure Period"). Minor or inadvertent deviations from the Compliance Plan that are promptly identified and corrected by Respondents shall not constitute a material breach of this Agreement.
43.  If Respondents fail to cure the alleged breach within the Cure Period, or if the breach is not reasonably susceptible to cure, Commission Staff may, in its discretion:
(a) Seek to enforce the terms of this Agreement before the Commission;
(b) Seek additional civil penalties from the Commission for the breach of this Agreement; and/or
(c) Petition the Commission to reopen the investigation in Docket No. IN23-7-000 with respect to the underlying conduct described in Section II of this Agreement.
44.  Nothing in this Section III.I shall limit or restrict any other rights or remedies available to Commission Staff under the Federal Power Act, the Commission's regulations, or applicable law.
> [MARGINAL NOTE — C. Bloom, 1/26/2024]: I have added the cure period (paragraph 42) and the "minor or inadvertent deviations" carve-out. These are important protections — without the cure period, a technical compliance hiccup (e.g., a late quarterly report) could theoretically trigger reopening of the entire investigation. The "minor or inadvertent" language appears in the Cascade Grid Partners consent agreement (Docket No. IN21-11-000) and should be acceptable to Staff. Confirm with Christine Pham.
J. Confidentiality.  
45.  The terms of this Agreement, once approved by the Commission, shall be public and shall be published in accordance with the Commission's customary practice for consent agreements and stipulations approved by Commission order.
46.  The underlying investigative record, including all documents produced by Respondents during the investigation, transcripts of investigative testimony, Commission Staff's work papers and analysis, and all communications between the Parties during the investigation and settlement negotiations, shall remain non-public and confidential and shall be subject to the protections of 18 C.F.R. § 1b.9 and any other applicable provisions of the Commission's regulations regarding the confidentiality of enforcement investigations. Neither the Commission nor Commission Staff shall publicly disclose any portion of the non-public investigative record except as required by law or as necessary to enforce the terms of this Agreement.
> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: Confirm that the Commission order approving the Agreement will be published but the investigative file remains non-public per Part 1b. This is standard treatment. The consent agreement itself will be appended to the Commission's public order. The investigative record (including the 187,000 documents produced, testimony transcripts, and Staff's Preliminary Findings letter) remains non-public. Note: if the consent agreement is approved, the Commission's order will typically include a summary of the allegations and the terms of the settlement, but not the full investigative record.
K. Governing Law
47.  This Agreement shall be governed by and construed in accordance with federal law, including the Federal Power Act, 16 U.S.C. §§ 791a et seq., and the regulations of the Commission promulgated thereunder.
L. Entire Agreement
48.  This Agreement, together with Appendix A (Enhanced Compliance Plan), which is attached hereto and incorporated herein by reference, constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations, and discussions, whether oral or written, between the Parties relating to the subject matter hereof.
49.  No amendment, modification, or waiver of any provision of this Agreement shall be effective unless set forth in a writing signed by all Parties or their duly authorized representatives.
M. Counterparts.  
50.  This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. Facsimile and electronic signatures, including signatures transmitted in Portable Document Format (PDF) by electronic mail, shall be deemed original signatures for all purposes.
IV. SIGNATURE BLOCKS
IN WITNESS WHEREOF, the Parties have executed this Stipulation and Consent Agreement as of the dates set forth below.
FOR THE STAFF OF THE OFFICE OF ENFORCEMENT OF THE FEDERAL ENERGY REGULATORY COMMISSION:
By: ________
Name: Christine Pham
Title: Senior Attorney, Division of Investigations
Office of Enforcement Federal Energy Regulatory Commission 888 First Street NE Washington, D.C. 20426
Date: ________
> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: Confirm whether Margaret Hollowell (Director, Division of Investigations) needs to sign as well, or whether Christine Pham's signature alone is sufficient for Staff. In the Vitanova Trading consent agreement (Docket No. IN22-4-000), both the lead attorney and the Division Director signed. In the Cascade Grid Partners consent agreement (Docket No. IN21-11-000), only the lead attorney signed. Ask Christine Pham to confirm the appropriate signatory protocol.
FOR DUNMORE ENERGY HOLDINGS LTD.:
By: ________
Name: Martin Llewellyn
Title: General Counsel
Dunmore Energy Holdings Ltd. 2200 Post Oak Boulevard, Suite 3100 Houston, Texas 77056
Date: ________
> [MARGINAL NOTE — C. Bloom, 1/26/2024]: Confirm with Martin Llewellyn whether Gavin Harcourt (as CEO) or the Board of Directors also needs to authorize execution. Given the penalty amount ($4.75 million), this likely requires Board resolution under DEH's organizational documents (specifically, the Amended and Restated Articles of Association, Section 7.4(c), which requires Board approval for settlements and litigation expenditures exceeding $2.5 million). Coordinate with Martin to ensure a Board resolution authorizing execution of the Agreement is obtained prior to the target execution date of January 31, 2024. Draft Board resolution for Martin's review.
FOR DUNMORE POWER TRADING LLC:
By: ________
Name: Martin Llewellyn
Title: Authorized Representative
Dunmore Power Trading LLC 2200 Post Oak Boulevard, Suite 3100 Houston, Texas 77056
Date: ________
> [MARGINAL NOTE — H. Brinkley, 1/26/2024]: DPT is a wholly owned subsidiary of DEH — confirm that Martin Llewellyn has authority to sign for DPT as well, or whether separate authorization from DPT's managing member (DEH) is required. Review DPT's LLC Agreement (Section 3.2, Manager Authority). Alternative: Derek Sung, SVP of DPT, could sign for DPT if Martin is only authorized to sign for DEH. Confirm organizational authority with Martin by end of week.
APPROVED AS TO FORM — COUNSEL FOR RESPONDENTS:
By: ________
Name: Catherine Bloom
Title: Partner
Calderwood & Harkness LLP 1001 Fannin Street, Suite 4200 Houston, Texas 77002
Date: ________
V. APPENDIX A — ENHANCED COMPLIANCE PLAN
Cross-Reference and Summary
Appendix A to this Stipulation and Consent Agreement is the Enhanced Compliance Plan, which is a separate document prepared in coordination with Ridgeway Compliance Solutions LLC and is incorporated by reference into this Agreement. The Enhanced Compliance Plan is attached hereto and made a part hereof for all purposes.
The Enhanced Compliance Plan includes the following key provisions, which are summarized below for reference. In the event of any inconsistency between this summary and the detailed provisions of Appendix A, the provisions of Appendix A shall control.
(a) Duration. The Compliance Monitoring Period shall be thirty-six (36) months from the Effective Date, ending approximately February 9, 2027, based on the anticipated Effective Date.
(b) Chief Compliance Officer. Jennifer Caulfield shall serve as Respondents' Chief Compliance Officer, reporting directly to the Board of Directors of DEH.
(c) Annual Compliance Training. All trading personnel shall complete a minimum of sixteen (16) hours of compliance training per calendar year, covering the anti-manipulation provisions of the Federal Power Act and the Commission's regulations, market rules and tariff requirements, and internal compliance policies and procedures.
(d) Quarterly Compliance Audits. Ridgeway Compliance Solutions LLC, under the direction of Dr. Carolyn Whitford, Founder and Managing Director, shall conduct quarterly compliance audits of Respondents' trading operations and submit audit reports to the Chief Compliance Officer and Commission Staff concurrently.
(e) Automated Trade Surveillance Systems. Respondents shall implement and maintain automated trade surveillance systems designed to detect potential market manipulation patterns in the MISO and SPP wholesale electricity markets.
(f) Quarterly FERC OE Reporting. Respondents shall submit quarterly written reports to the Commission's Office of Enforcement for the duration of the Compliance Monitoring Period.
(g) Annual CEO/CCO Certification. The Chief Executive Officer (Gavin Harcourt) and the Chief Compliance Officer (Jennifer Caulfield) shall each execute an annual written certification of compliance.
> [MARGINAL NOTE — C. Bloom, 1/26/2024]: Final Appendix A will be the Enhanced Compliance Plan document prepared separately by C&H in coordination with Ridgeway Compliance Solutions. Current working draft of Appendix A is dated January 19, 2024 (v.3). Ensure consistency between this cross-reference summary and the final compliance plan. Hannah — please run a comparison of this summary against the January 19 draft of Appendix A and flag any inconsistencies before we circulate to FERC Staff. Target: attach final Appendix A to the executed Agreement by January 31, 2024.
VI. C&H INTERNAL ANNOTATIONS AND REVIEW NOTES
[INTERNAL — NOT FOR DISTRIBUTION TO FERC STAFF]
> [OVERALL ASSESSMENT — Catherine Bloom, Partner, Calderwood & Harkness LLP, 1/26/2024]: > > This draft reflects the terms agreed on January 24, 2024: > > - Civil penalty: $4.75 million (paid in two installments) > - Disgorgement: waived entirely > - Compliance plan: 36-month Enhanced Compliance Plan with independent monitor > - Neither admit nor deny: comprehensive protective provision > > Total monetary resolution: $4,750,000. This represents a reduction of approximately $26,050,000 (84.6%) from FERC Staff's initial demand of $30,800,000 (consisting of $18.0 million civil penalty + $12.8 million disgorgement). > > Key open items: > > 1. Confirm FERC Staff accepts our proposed "neither admit nor deny" formulation, including the additions to paragraphs 29–31. > 2. Confirm scope of Staff waiver re: named individuals (Kyle Renfro, Anastasia Petrov, Derek Sung) and whether the waiver extends to Dunmore Midstream Partners LP. > 3. Confirm cure-period language in breach provision (paragraph 42) and "minor or inadvertent deviations" carve-out. > 4. Confirm Staff accepts "shall not be unreasonably withheld" language in compliance plan modification provision (paragraph 28). > 5. Coordinate Board authorization with Martin Llewellyn — Board resolution required for settlement exceeding $2.5 million per DEH Articles of Association, Section 7.4(c). > 6. Finalize Appendix A (Enhanced Compliance Plan) — current working draft v.3 dated January 19, 2024. > > Target execution date: January 31, 2024. > Anticipated FERC order: early February 2024 (estimated February 9, 2024).
> [CIRCULATION PLAN — Hannah Brinkley, Associate, Calderwood & Harkness LLP, 1/26/2024]: > > Proposed next steps: > > 1. Internal review complete by COB Monday, January 29, 2024. > 2. Send clean and redline versions to Christine Pham (FERC Staff) on Tuesday, January 30, 2024. > 3. Copy Martin Llewellyn (Dunmore General Counsel) on all correspondence with Staff. > 4. Copy Alan Ngo (C&H billing department) for billing purposes — Matter No. 1016-00004. > 5. Flag for Catherine Bloom: schedule call with Christine Pham for January 30 or 31 to discuss open items identified above.
CONFIDENTIAL — ATTORNEY WORK PRODUCT — ATTORNEY-CLIENT PRIVILEGED COMMUNICATION Calderwood & Harkness LLP | 1001 Fannin Street, Suite 4200 | Houston, Texas 77002 C&H Matter No. 1016-00004 | Billing Code: 71420.00001
In the Matter of
Dunmore Energy Holdings Ltd. | Docket No. IN23-7-000
and
Dunmore Power Trading LLC

PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT ATTORNEY-CLIENT PRIVILEGED COMMUNICATION

UNITED STATES OF AMERICA BEFORE THE FEDERAL ENERGY REGULATORY COMMISSION

I. CAPTION AND INTRODUCTORY PARAGRAPH

UNITED STATES OF AMERICA BEFORE THE FEDERAL ENERGY REGULATORY COMMISSION

STIPULATION AND CONSENT AGREEMENT

II. RECITALS

III. TERMS AND CONDITIONS

IV. SIGNATURE BLOCKS

FOR DUNMORE ENERGY HOLDINGS LTD.:

FOR DUNMORE POWER TRADING LLC:

VI. C&H INTERNAL ANNOTATIONS AND REVIEW NOTES

Record

Parties

Dates

Amounts