From: To: Subject: Date:

Cestari, Kenneth Richardson, Susan RE: tax exempt bonds (Vogtle) Friday, December 11, 2009 1:54:47 PM

Orrick is going to explain to me why the guarantee will not cause the bonds to be taxable. After the call I will inform them that they will need to prepare a memo. Kenneth C. Cestari Attorney Advisor Loan Guarantee Program U.S. Department of Energy Room 4B-122 1000 Independence Avenue SW Washington, DC 20585 Tel - 202.287.5523 Mobile - 202.306.7889 Kenneth.Cestari@hq.doe.gov -----Original Message----From: Richardson, Susan Sent: Friday, December 11, 2009 1:53 PM To: Cestari, Kenneth Subject: RE: tax exempt bonds (Vogtle) w whom? -----Original Message----From: Cestari, Kenneth Sent: Friday, December 11, 2009 1:35 PM To: Richardson, Susan Subject: FW: tax exempt bonds (Vogtle) Susan - Let me know if you would like to join in on a 3:00 PM call re tax exempt bonds. Ken Kenneth C. Cestari Attorney Advisor Loan Guarantee Program U.S. Department of Energy Room 4B-122 1000 Independence Avenue SW Washington, DC 20585 Tel - 202.287.5523 Mobile - 202.306.7889 Kenneth.Cestari@hq.doe.gov -----Original Message----From: Cestari, Kenneth Sent: Friday, December 11, 2009 1:34 PM To: 'Lyon, Carl' Cc: Whitcombe, Nicholas; Fuller, Jim; mrapaport@nixonpeabody.com; jill.toporek@gs.com; Colyar, Kelly Subject: RE: tax exempt bonds (Vogtle) 3:00 PM Works for me. Kenneth C. Cestari

Susan Richardson GPC Correspondence 189

Attorney Advisor Loan Guarantee Program U.S. Department of Energy Room 4B-122 1000 Independence Avenue SW Washington, DC 20585 Tel - 202.287.5523 Mobile - 202.306.7889 Kenneth.Cestari@hq.doe.gov -----Original Message----From: Lyon, Carl [mailto:cflyon@orrick.com] Sent: Friday, December 11, 2009 1:04 PM To: Cestari, Kenneth Cc: Whitcombe, Nicholas; Fuller, Jim; mrapaport@nixonpeabody.com; jill.toporek@gs.com Subject: RE: tax exempt bonds (Vogtle) Ken, We would like to have a conference call to discuss this and the reasons why these guidelines are not violated by our transaction. Would 3 PM work for you? If so please use the following dial in: 888-327-8914 9842591# Carl F. Lyon Partner ORRICK, HERRINGTON & SUTCLIFFE LLP tel 212-506-5180 fax 212-506-5151 mobile cflyon@orrick.com www.orrick.com -----Original Message----From: Cestari, Kenneth [mailto:Kenneth.Cestari@hq.doe.gov] Sent: Friday, December 11, 2009 11:57 AM To: Lyon, Carl Cc: Cestari, Kenneth; Whitcombe, Nicholas Subject: FW: tax exempt bonds (Vogtle) Importance: High Carl - To follow up on our conversation, please see below and focus on item (5) below (linkages to of federal guarantees to tax exempt obligations). From Treasury: Section b4 of the IRS Code, b4 b4 the interest on obligations that are b4 , indicates that, with certain exceptions,

b6

b4

b4

b4

b4

b4

b4

b4

b4

b4

Below from OMB: See OMB Circular A-b4

b4

- http://www.whitehouse.gov/omb/circularsb4

b4

which provides as follows: II. BUDGET AND LEGISLATIVE POLICY FOR b4

b4

Susan Richardson GPC Correspondence 190

2. Form of Assistance. REFERENCES:

b4

Statutory Federal b4 Direct or indirect b4

b4 b4 b4 b4 b4

, b4 U.S.C. b4 b4
b4

b4

Internal Revenue Code (Section b4

b4 b4 b4

b4 b4 b4 b4 generally thought that the cost to the b4 b4 b4 b4 b4 b4 b4

to the Government. It is b4 The Internal Revenue Code provides some exceptions to this requirement; see Section 149(b) of the Internal Revenue Code for further details.

b4 b4 b4 b4 b4

b4 b4 b4 b4 b4

b4 b4 b4 b4

b4 b4 b4

b4 b4 b4

b4

To preclude the possibility that Federal agencies will b4 indirectly, agencies will: (1) b4

b4

b4

, either directly or

b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4

b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4

b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4

b4

(2) provide that b4

b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4

b4 b4 b4 b4 b4 b4 b4

b4 b4 b4 b4 b4

b4 b4 b4 b4 b4
;

b4 b4 b4 b4 b4
(3) b4 (4) b4 (5) b4

; and . For example, such b4 covering a portion b4 b4 to be b4 b4 . Therefore,

b4

b4 of the cost. In such cases, the Federal b4 b4 b4 b4 b4 b4 b4 b4 b4 b4 b4

Where a large degree of b4

is, in effect, b4

b4 b4

b4 b4

b4

b4

b4

b4

the use of direct loans.

b4

b4

b4

b4

=========================================================== IRS Circular 230 disclosure: To ensure compliance with requirements imposed by the IRS, we inform you that any tax advice contained in this communication, unless expressly stated otherwise, was not intended or written to be used, and cannot be used, for the purpose of (i) avoiding tax-related penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any tax-related matter(s) addressed herein.

Susan Richardson GPC Correspondence 191

=========================================================== NOTICE TO RECIPIENT: THIS E-MAIL IS MEANT FOR ONLY THE INTENDED RECIPIENT OF THE TRANSMISSION, AND MAY BE A COMMUNICATION PRIVILEGED BY LAW. IF YOU RECEIVED THIS EMAIL IN ERROR, ANY REVIEW, USE, DISSEMINATION, DISTRIBUTION, OR COPYING OF THIS E-MAIL IS STRICTLY PROHIBITED. PLEASE NOTIFY US IMMEDIATELY OF THE ERROR BY RETURN E-MAIL AND PLEASE DELETE THIS MESSAGE FROM YOUR SYSTEM. THANK YOU IN ADVANCE FOR YOUR COOPERATION. For more information about Orrick, please visit http://www.orrick.com/ ===========================================================

Susan Richardson GPC Correspondence 192