HomeMy WebLinkAbout1975_TEXAS MUNICIPAL POWER AGENCY
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CONTRACT FOR DEVELOPMENT OF FUEL RESOURCES,
PLANNING ELECTRIC GENERATION FACILITIES AND
_ PERFORMING CERTAIN_ DUTIES
I
THIS INSTRUMENT embodies four separate contracts, which
for the most part are identical, in order that all parties
signatory will be apprised of all contents and under no
circumstance does one city assume an obligation, which under
the terms hereof, is assumed by another city. These contracts
are made and entered into as of the 1,3- day of September,
1975, the fir9t contract is by and between the TEXAS MUNICIPAL
POWER AGENCY (hereinafter called "Agency"), and the City of
Bryan (hereinafter called "Bryan"), and a second contract is
by and between the Agency and the City of Denton (hereinafter
called "Denton"), ani a third contract is by and between the
Agency and the C.lty of Garland (hereinafter called "Garland"),
and a fourth contract is by and between the Agency and the
City of Greenville (hereinafter called "Greenville"), each
of such cities; being a municipal corporation organized and
existing undei the Constitution and laws of the State of
Texas (hereinafter collectively called "cities" or "each
pity" or "the city"), and each of such parties being a
political subdivision of the State of Texas, and a body
politic and corporate.
W I T N E S S E T H
WHEREAS, under the provisions of Article 1435a, V.A.T.C.S.,
entities engaged in the generation, transmission, or distri-
bution of electric energy may join together as co-tenants or
co-owners in the planning, financing, acquisition, construction,
ownership, operation and maintenance of electric generating
units and plants, electric transmission lines and other
electric facilities; and may enter into agreements for the
planning, financing, acquisition, construction, ownership,
operation and maintenance of jointly owned and operated
electric facilities; and
WHEREAS, acting pursuant to Section 4(a) of Article
1435a, V.A.T.C.S., the Texas Municipal Power Agency has been
created and established as a municipal power a ency without
g
taxing power) as a separate municipal corporation, a political
subdivision of the State and a body politic corporate, and
such agency has and may exercise all of the powers which are
by Chapter 10 of Title 28, Revised Civil Statutes of Texas,
1925, as amended, and Article 1435a conferred upon a public
entity or entities; and
WHEREAS, the Agency is empowered to make contracts and
agreements with municipalities, political subdivisions of
the State, and public or private corporations or persons and
perform all acts necessary for the exercise of the full
powers invested in it; and
WHEREAS, by virtue of the foregoing, each of the parties
hereto is empowered to execute this contract; now, therefore,
THE PARTIES TO EACH CONTRACT, IN CONSIDERATION OF THE
MUTUAL AGREEMENTS AND UNDERTAKINGS HEREINAFTER SET FORTH,
HEREBY CONTRACT AND AGREE AS TOLLCTS:
ARTICLE I
SECTION 1.01: As the basis for its Eateriii~r ii,ty LLiO
contract, the parties to these several contracts each make
the following finuings uf iacc:
.
(a) The Cities of Bryan, Denton, Garland and Green-
ville and the Brazos Electric Power Cooperative, Inc.
(hereinafter collectively referred to as "entities"):
(1) each maintain its own electric generating
facilities to meet power and electric energy
requirements for its own electric system; and have
entered into a pooling agreement with each other
for the purpose of:
(i) effecting investment and operating
economies by pooling the use of reserve
electric capabilities and capacities; and
(ii) obtaining power during emergencies and
scheduled maintenance service; and
(2) are members of the Texas Interconnected
System so that the generation plus purchased power
will equal forecasted peak demands increased by
15% in order to provide the pro rata share of the
reserves required by the Texas Interconnected
System; and
(3) endeavor to carry a spinning reserve above
load requirements, as required by Texas Inter-
connected System; and
(4) have electrical systems which are connected
by more than 1900 miles of transmission lines
which extend southward from the Oklahoma border to
just north of Houston, as well as from Bryan to as
far west as Seymour with coordination of generation
and transmission now being provided by a central
dispatching center in Waco, Texas, (which center
coordinates the level of generation of each plant
and the control of the system transmission lines
and substations), and
(5) now have a basic transmission interconnection
between the parties which are provided through 69
and 136 kv transmission facilities of the Brazos
Electric Power Cooperative, Inc., and in some
instances direct connections between the parties
and privately owned utilities in the areas of
service.
(t) On a national level load growth for electric
systems has doubled approximately every 10 years but
the load growth of the entities' systems has almost
quadrupled in approximately 11 years, and the projected
power requirements of the entities indicate that additional
generating and transmission facilities will be required
each year of the next decade and a half in order to meet
peak demands needed by the year 1990; and
(c) It appears that small independent plants will not
meet the needs of the future (1) because of their
higher construction and operating costs which result in
power costs higher than for larger, more efficient
plants, and (2) larger plants woule provide for efficient
utilization of generation and transmission facilities,
increased reliai'lity and a reduction in multiple
planning and operating costs, and reduced environmental
problems; and
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(d) In connection with the plans of the parties hereto
to acquire and obtain additional generation facilities
it is apparent that a new supply of fuel will be required
since (J.) natural gas is the primary fuel source for
the generating facilities for each of the entities, and
(2) the supply of natural as as a fuel is of questionable
dependability and duration in the light of existing
supply contracts and the impending curtailment of
delivery and restrictions on the use of natural gas for
boilers; and (3) it is also apparent that the construction
of a large lignite fired generating plant by this
entity acting alone would not be economically feasible;
and
(e) n consideratio❑ of the load growth of the parties
indicates chat projectionf. --ould vary from the histor-
ical trends but sharing of capacity with other entities
will reduce the hazards of incorrect load projections
for the entity and judicious adjustment may be made in
the date for placing new joint faci.litics in service;
and
(f) It appears that there is a need to expand joint
efforts of the parties to include ito'. only the sharing
of the reserves but also the benefits of economic dis-
patch and savinggs in capital costs by the construction
of large units i.n a coordinated ple<<; and
(g) Petroleum products, particularly natural gas, have
increased in price from 3 to S times, and natural gas
curtailments have occurred on a random basis with
serious consequences in fuel supply problems by the
entity, and additional curtailments are being ordered
by various regulatory agencies and the increasing of
c*al production is a long slow process, and it is
hampered in part by environmental restrictions prohibiting
the use of coal and petroleum products with a high
sulphur content; and
(h) The uninterrupted and adequate supply of fuel is
essential to the continued operation of the generating
facilities which mandates the development of fuel
supplies controlled by the entities; and
(i) In tho investigation by the entities of certain
lignite deposits preliminary indications are that a
sufficient quantity of lignite exists to warrant the
construction of a lignite fired generating plant but
the information received to date requires additional
verification, and if the estimated quantities are
reasonably confirmed, additional expenditures will be
required to obtain options, royalty contracts, etc; and
(j) The lignite deposits might be of adequate quantity
and acceptable quality which could be utilized with
moderate problems of combustion and handling should it
be determined that the lignite exists in commercial
quantities; and
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(k) Consideration should be given to the desirability
of owning coal deposits in order to obtain a long term
supply or in the alternate, contractual arrangements
should be made with coal vendors who would indicate a
reasonable savings to the parties if ownership of such
resources and facilities necessary to mine and transport
the fuel can be properly financed and careful analysis
is required to determine the extent of capital funds
which would be needed to insure the dedication if
adequate reserves for long term utilization by the
process of disbursing substantial "front end money",
and other capital funds would be required or be better
expended for transmission, generation and transporta-
tion facilities (if given a higher priority) than
owning fuel resources; and
(1) The acquisition of fossil fuel resources at locations
other than the generating plant site will require
transportation of fuels from one or more geographical
locations in accordance with a particular state of the
art for each type of fuel whether it is solid, liquid
or gaseous; and
(m) Until such time as there is a definite commitment
for coal or lignite (either or both) resources and the
established magnitude of fuel to be transported in any
given year it is not possible to identify with accuracy
anticipated transportation costs; and
(n) It appears that additional investigations should
be made to determine whether various types of trans-
portation facilities could be leased, thereby increasing
the maintenance and operating expenses, or whether it
would be more economical to purchase such facilities;
and
(o) Nuclear generating plants both planned and under
construction have been subjected to vigorous opposition
causing substantial delays in the construction and
availability of electric energy; an,l
(p) The refinement, enrichment, conversion and fabrication
of nuclear fuel involves long lead time commitments
similar to developing new coal resources, and the cost
of one component of nuclear fuel (uranium) has almost
quadrupled in the past 3 years so that the supply of
domestic uranium is anticipated to be extremely tight
by 1980 so as to cause an increase in the price of such
fuel• however, nuclear generation may economically
supp~y a portion of entities' generation requirements;
and
(q) Transmission planning studies cannot be refined
until final generation plans have been completed and
sufficient information has been assembled to enable
preliminary transmission arrangements to be developed
and additional study is required in connection with
such transmission plans; and
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(r) Transmission costs involve the computation of
mileage as well as the number of substations which
would be required; and
(s) The planning of the expansion of electric generat-
ing facilities in the magnitude bring considered by the
parties requires an identification of potential water
resources which might be utilized for plant cooling,
the specific type of cooling system for which the plant
is designed determining to a large extent the cooling
requirements since the total water makeup requirements
could generally be expected to be between 1/2 and 1
gallon per kilowatt hour for evaporative and blowdown
losses; and
(t) The range of water utilization would also depend
upon whether the plant utilized crater for ito cooling
systems or whether dry towers were used where water is
utilized only for boiler blow-dowr,, and the variables
involved in the utilization of cooling vater requirements
indicate additional capital cost or annual operating
cost would vary so that a study is needed in order to
determine which is the most economical for the parties;
and
(u) Power f: ow analyses are needed in order to deter-
mine transmission requirements, and environmental and
economic consideracfons require the opportunities for
joint planning and coordinated development of trans-
mission with other area utilities; and
(v) The question arises whether combustion turbines shoOd
be added so of to relieve a portion of the deficiency
in capacity and energy for the period of 1978 through
1982 even with the increasing cost and reduced availability
of natural gas and liquid petroleum fuels but it would
be feasible to further investigate to determine if the
combustion turbines could be used as the initial building
block for the inE;taliation of combined cycle generating
facilities, bu. the type of combustion that should be
used will vary with the amount of time per year that it
will operate. The aiproach of adding a combustion
turbine with an existing unit requires detailed analysis
so that consideration may be given to the anticipated
life of the existing equippment in connection with the
cost analysis which must be developed, and it further
appears that steam pressure and temperature conditions
for existing turbinc- -ou13 affect the a9r__ and
cost that would be used; and
(w) The delegation of dispatch responsibility for the
resources of the parties to a central coordination
center would be an improvement in the overall economics
of operation although local conditions such as minimum
load restrictions on units, limitations on incoming
transmission line or transformer capabilities, and the
need to operate generation for voltage support might
place some constraintants on dispatching; and
t.
(x) Each entity will receive a benefit from the expenditures
which a:e to be made and for the services and work to
be performed under the provisions of this contract
since (1) each of the engineering studies are needed in
order that an informed judgment may be made as to the
extent that this entity should proceed with the proposed
joint endeavors, and such studies will also give this
governing body the information that is needed with
respect to some of its own operations so improvements
in procedures may be perfected, and (2) it is necessary
to acquire and develop new fuel sources which may be
used and utilized for generation, and it is essential
that a fuel supply be obtained and developed prior to
the determination of the location of proposed generating
units, and (3) the construction of the interconnection
with the private utilities and the transmission lines
to be constructed are needed to provide capabilities of
exchan ing electric capacity and energy between entities,
and (4~ storage facilities for an emergency fuel (in
the event of natural gas curtailment) are needed, and
(5) feasibility studies rust be made for the purpose of
obtaining financing for some of the above mentioned
facilities; and
(y) A nationally recognized consulting engineer has
extensively studied the Alternatives of independent and
joint action in obtaining generaO.ng and transmission
and developed estimates of the costs of both which show
savings ranging from $56,000,000 to $1,013,000,000 over
the period from 1983-1994 due to joint efforts.
The governing body of each of the cities signatory
specifically finds:
(i) the foregoing facts are true and recognizes that a
joint effort with the other entities is the best course
of action in meeting its power supply and transmission
requirements for the future; and
(ii) that the benefits to be received by such city will
be in excess of the costs which it is obligated to pay
hereunder (particularly since such costs are to be
shared by others); and
(iii) the engineering studies proposed to be made
hereunder relate to facilities which are required in
order for the electric light and power system of such
city to provide efficient service; and
(iv) the improvements proposed to be constructed or
acquired by the Agency hereunder are needed to insure
that electrical energy may be made available for use
and distribution by tfie electric light and power system
of such city and thereby provide adequate service to
the customers of the city's distribution system.
In the makin8 of findings herein, the parties are setting
forth a portior_ t= the reasons for the execution hereof, and the
same are not to be considered as representations upon which
tbird pertLpa hnyr. Any rioht to rely without independent
verification.
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SECTION 1.02: The parties signatory, in recognition of
the facts set -forth, believe there is a need for immediate
steps to be taken ii, the planning of a cooperative endeavor
under the provisions of Article 1435a, V.A.T.C.S., as well
as the necessitf for immediate steps to be taken in the
development of an adequate fuel supply for the proposed
generating facilities.
SECTION 1.03: The City agrees and covenants with the
Agency t at to t^Tie extent it may legally do so:
(a) The City will not hereafter make any expenditure
of funds for the purpose of constructing or acquiring additional
electric generating capabilities (including, improvements to
or extensions of presently existing generating facilities
which increase the rated capacity of such existing facilities
by more than 10% in any two year period) other than those
generating facilities under contract for construction or
under construction as of the date of this Agreement, or
other improvements (not additions to the plant) which have the
result of increasing the rated capacity of the generating
facilities to such an extent within such periods, unless:
(1) it has obtained the approval of the same as a
joint project from the governing bodies of the Agency
and the Texas Power Pool, Inc, (hereinafter called
the "Corporation"), or
(2) the governing bodies of either the Agency or the
Corporation fail to approve the same as a joint
project for a period of 90 days after written
notice is given to them by the City that the City
wishes to proceed with the project.
(b) The City will not hereafter make airy expenditure
for the purpose of constructing or acquiring additional
transmission facilities which will interconnect with any of
the facilities of the Cities or any joint projects which are
primt:rily for transmitting power to Brazos or the Cities
unless:
(1) it has obtained the approval of the same as
a joint project from the governing bodies of the
Agency and the Corporation, or
(2) the governing bodies of either the Agency or the
Corporation fail to approve the same as a joint
project for a period of 90 days after written
notice is given to them by the City that the City
wishes to pr,cLeed with the project.
(c) The City will not make any expenditure for the
acquisition of a fuel supply (other than natural gas, oil,
diesel) for its electric generating facilities unless:
(1) it has obtained the approval of the same as
a joint project from the governing bodies of the
Agency and the Corporation or
(2) the governing bodies of either the Agency or the
Corporation fail to approve the same as a joint
project for a period of 90 days after written
notice is given to them by the City that the City
wishes tc proceed with the project.
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(d) The City will not hereafter enter a contract for
the purchase by it of capacity or electric energy to meet
load plus reserves with any entity other than the Agency,
Brazos or the cities unless:
(1) it has first offered in writing for a period
of ten consecutive days to purchase such capacity
or energy from the Agency, Brazos or from one of
the cities (under the same terms and conditions),
and such offer has not been accepted in writing,
or
(2) Brazos and the other cities and the Agency
notify the City in writing, that no capacity or
energy is available in the quantity (under the
same terms and conditions) and for the period of
time requested by the City.
The provisions of this paragraph (d) have no application
to the purchase of capacity or energy (i) on an emergency or
stand-1y basis, or (ii) under a contract having a duration
of less than two years (including any renewals thereof), or
(iii) for power or energy incident to the construction and
testing of any facilities constructed by the Agency or its
agents, or (iv) on the basis of economic dispatch ["economic
dispatch" means the allocation of the total generation
required of the pool to alternate available sources in order
to achieve the best iossible pool economy consistent with
safe, effective ope-ttion. (Factors to s considered iu
determining the beat possible economies include line losses,
generator efficiencies, fuel costs, load limits of generators,
transmission line lead limits, purchase power costs, and
fuel, generation, acid purchased power contractual obligations)]
between the Cities, the Corporation, the Agene) and Brazos,
any or all, or (v) under the existing contract with Texas
Municipal Power Pool, Inc.
(e) The City will not hereafter enter a contract for
the sale by it of o;spacity or energy to an entity other than
the Agency, Brazos or the cities unless:
(1) it has first offered in writing for a period
of ten consecutive days to sell such capacity or
energy to the Agency, Brazos or to one of the
citieu (under the same terms and conditions), and
such offer has not been accepted in writing, or
(2) Brazos, the Agency, and the other cities
notify the City, in writing, that no capacity or
energy is required in the quantity (under the same
terms and conditions) and for the period of time
offered by the City.
The provisions of this paragrapPh (e) hr,ve no application
to the sale of capacity or energy (i) on an emergency or
stand-)y basis or (ii) on a contract having a duration of
less than two years (including any renewals thereof) or
(iii) for purchase of power incident to the construction and
testing u" any facilities constructed by the Agency or (iv)
the basis of economic dispatch between the Cities, the
Corporation, the Agency and Brazos, any or all, or (v) to
customers who are not Class 1 utilities (under F.Y.C. guidelines)
except at isolated points, ("isolated points" means a location
at which power and energy from a transmission or distribution
system of one entity is delivered as purchased power at the
distribution system of another entity, or to one of its
members, subsidiaries or customers), or (vi) to municipal
corporations that are not tLen interconnected with other
utility companies or (vii) under the existing contract with
Texas Municipal Power Pool ?.nc., or (viii) to another
distribution system which is •--Aned by a city, and operated by
the city seperately and aperr from the City a system,
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Y,
The purpose and intent of paragraph (e) is to prevent
Lhe sale of surplus electric energy or capacity by the City
to others than Brazos, the other cities or the Agency if
such energy or capacity (1) is required to meet the needs of
Brazos or the cities and (2) may be made available to them.
It is not intended to prevent the sale of electric energy or
capacity to regular customers of the City.
ARTICLE: II
SECTION 2.01: In connection with its undertakings
hereunder, eacci City represents as follows:
(a) In its capacity as a duly incorporated city of
Texas, it is empowered under applicable laws to
enter into the engagements prescribed for it under
this agreement and to perform all obligations
which may result therefrom and its governing body
has duly authorized execution of this agreement.
(b) It will timely pay to the Agency the full amount
it is required to pay under the provisions of this
contract for the services supplied by or work
performed by the Agency.
(c) That it will (i) plan, construct, maintain and
finance its electric transmission and distribution
system, and (ii) set and collect rates to customers
for electric service adequate to meet its obligations,
including those hereunder.
(d) That it will cuoperate with the Agency in the per-
formance of the duties and reaponfibilities assigned
to the Agency by this contract.
SECTION 2.02: Agency represents to the City and agrees
with aucF_party_t_hat it will do or will cause the following
to be done:
(a) prepare comprehensive plans for the generation
of ca,>acity and energy anl. the tr:•ismission thereof
to mutually agreed upon load centers. The planning
by the Agency shall be comprehensive in nature,
shall consider the sources of fuel and water, uses
thereof, recycling, pollution sources and pollution
abatement techniques;
(b) join in the performance of planning functions
and enter into planning agreements for such term
and upon such conditions as may be deemed desirable
so as to pro-vide coordinated planning on an area-
wide scale;
(e) evaluate the planning as facilities are completed;
(d) coordinate and monitor the design, construction
and operation of joint facilities;
(e) coordinate and monitor the economic dispatching
of generating facilities;
(f) pro,4ide accounting and cost allocation for above
activities.
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ARTICLE III
SECTION 3.01: The work to be done by the Agency, either
througgE fts*own representatives or authorized agents or
under contract with others, by virtue of this contract is
as follows:
(a) Fuel development:
Bryan lignite:
drilling, logging, coring, surveying,
testing and analysis to accurately
determine the quality and quantity of
the lignite deposits; acquisition of
land or interest therein.
The Agency shall retain such geologist
or fuel consulting firm (either or both)
as in its judgment is required to make
appropriate determinations (based on
such drilling, logs, corings, surveys
and analysis) as to whether such lignite
deposits are of commercially mineable
quality and quantity. The Agency shall
utilize bond proceeds only for the
acquisition of land or interest therein
as meet the criteria established by such
geologist or consultants.
The estimated budget submitted by the
Agency as guidelines for such proposed
uperation being as follows:
Estimated Short Term Item Estimated Cost
Paul Weir Studies $ 226,500
Aerial Surveying 95,000
Drilling and geological analyses 519,000
Land men 316,000
Lease options 40,000
Leases of land 60,000
Purchase options 25,000
Purchases of land 3,6000000
Lease conversion bonus 105,000
Geologist lease conversion fee 150,000
Preliminary engineerii,g studies 100,000
Environmental and air quality studies 150,000
Legal evaluation of deed, titles 50,000
Testing of cores, samples 35,000
Miscellaneous 100,000
$5,571,500
Other lignite:
drilling on exploratory basis and pre-
liminary le=sing (under terms and conditions
similar to those set forth with respect to Bryan
lignite)
$ 150,000
Western coA1:
negotiations and minor development expenses
in order to determine availability of
coal as a fuel supply.
$ 25,000 I
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r. s
(b) Engineering Studies:
Combustion turbines
Evaluation of alternates
simple cycle combustion turbines
regenerative cycle combustion turbines
combined cycle generation
combustion turbines ennnected to
supply waste heat to older existing
units
negotiation of firm power purchase
contracts with other suppliers of
electric energy
Preparation of feasibility study for financing
$ 50,000
Economic Dispatch:
Tests on performance of generating units of
the cities of Bryan, Denton, Garland, Greenville
and chL Brazos Electric Power Cooperative, Inc.;
study of existing power pools; studies in
engineering accounting, computer analysis
on accounting criteria; operating guidelines
and personnel.
$ 107,000
Comanche Peak Nuclear Plant:
Engineerins study on feasibility of 10%
participation in the plant.
$ 50,000
Village Bend Pumped Storage:
Project investigation under application hereto-
fore approved by the Federal Power Commission,
Phases lA and 1B only (the work prior ro
Project Evaluation Report).
$ 125,000
Microwave Cv uuunications System:
Path and site location studies and contruction
of the facilities.
r
$ 550,000
Transmission Planning Studies:
Evaluation of alternate transmission plans.
$ 40,000
.1 Texas Interconnected System Studies:
Gathering of data on load flow, short circuit,
power transfer, stability, etc.
f $ 5 , 000
Fuel Studies:
Development of a fuel management study,
(quaitities consumed, usage patterns etc.)
by computer analysis.
$ 10,000
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Cost of Service Studies:
A detailed study of all costs involved in
the generation and Lransmissiun of capacity
and energy,
$ 4,000
(c) Construction:
Interconnection with private utilities,
$1,084,000
Olinger-Greenville Transmission line -
additional connection of Greenville and Garland
for emergency power: engineering and pre-
liminary construction expense.
$1,000,000
(d) Acquisition of storage facilities for oil (emergency
fuel supply).
- $ 430,000
SECTION 3.02: The amounts hereinabove set forth are
those which ttFe Wgency feels are proper amounts for the
respective purposes; that the amounts shown are the approximate
anticipated expenditures through June, 1976.
SECTION 3.03: It shall be the duty of the Agency to
lk: amplify a ro eci budget of proposed capital expenditures as
maybe required by it so as to insure the foregoing project
' is accomplished, and the transfers of money from one item to
another may be made by the Agency, but no more than 25% of
i< t the amount budgeted for one item (listed in Section 3.J1) in
f excess of $50,000 nor more than 501 of the amount budgeted
,•jl for one item of $50,000 or less, may be transferred to one
;tw or more other items without approval of such transfer by the
Wei hted majority vote of the directors of the Agency as
yf I
j, welt as a weighted majority vote of the Agency's Board as
contemplated by the Rules and Regulations of the Agency.
SECTION 3.04: Any study made, including all preliminary
and final re orts, as a result of this contract shall be
made availab a to each city. Any facilities constructed or
acquired pursuant to this contract during their useful life,
t shall be the property of the Agency but shall be available
7f i for use by each city, subject to a charge for maintenance
and operating expenses (based upon the percent of the capacity
used) of such facility while being so utilized.
K
Any interest in land or fuel obtained as a result of
expenditures made pursuant to this contract shall be and
r, remain the property of the Agency, and fuel shall be made
1 ..available for use in the generation of electric energy as
eontetitplated by the remainder of this Section.
The parties hereto recognize that the purpose of this
age is to provide for certain preliminary expenses of
the Agency with the view that the .'agency will be in position
td,Acquire and construct (and provide fuel for) additional
r electric generation facilities so as to provide electric
energy to the cities and Brazos.
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For and in consideration of the agreements of the
F.~ cities and Brazos contained in the contracts being simultaneously
;b executed, the Agency has and does hereby agree to deliver to
Brazos and the cities energy produced by the electric generating
facilities that the Agency may hereafter acquire, utilizing
the fuel acquired under the provisions hereof, subject to
the limitations of this Section,
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41."M
The amount of electric energy made available to each of
the cities (and to Brazos under the contract mentioned) at
the bus bar of the Agency's generating facilities shall be
that amount of electric energy the value of which equals the
amount which has been paid by the cities and Brazos, respectively,
as debt service payments.
Such value of electric energy shall be determined on
the basis of cost of service studies with regard to producing
such energy (as determined by a registered professional
engineer employed by the Agency).
In the event the Agency does not acquire a generating
facility capable of utilizing the fuel acquired hereunder,
the Agency, upon the sale of such fuel, shall credit Brazos
and each of the cities with the proportionate share of the
receipts from such sale (based upon debt service payments
made by each such contracting party).
ARTICLE IV
SECTION 4.01: As used in this instrument, the term
"debt o t e gency" means the principal of, interest on,
reserve fund for, and any applicable redemption premium with
respect to the initial series of bonds of the Agency known
as 'TEXAS MUNICIPAL POWER AGENCY REVENUE BONDS, SERIES
1975," dated September 15, 1975, to be authorized in a principal
amount of not to exceed $10,625,000. The term does not
include any bonds or other obligations issued for the purpose
of refunding, cancelling, and in lieu of such Series 1975
bonds. The parties contemplate that a new contract will be
executed in the event such Series 1975 bonds are refunded or
if additional bond obligations are issued by the Agency
which pledge any income, revenues or payments received from
a city by the Agency.
SECTION 4.02: (a) For and in consideration of the
undertaRTHgs oFF-the Agency each City agrees that it will pay
to the Agency an amount of money for the payment of the
city's part of the (1) maintenance and operating expenses of
the Agency and (2) the debt of the Agency.
(b) The amount to be paid by each city for the payment
of such maintenance and operating expenses shall be as
follows:
.16 mills for each kilowatt hour of net energy for load
of that particular city's Electric System or Systems
during the fiscal year of the Agency. The term "net
energy for load" shall have the meaning set forth on
F.P.C. form, 12 E-1, page 5, Schedule I; i.e., the
system net generation plus energy received from others
minus energy delivered to others. The amount due from
each city shall be divided into 12 approximately equal
monthly payments based upon the estimated net energg
for load. Such estimate to be made as follows: (1~
on or before the first day of each fiscal year, the
utility director of each city shall file (with the
Executive Director of the Agency) a report containing
his estimate of the net energy for load for the such
city for the following 24 month period and from such
report the arithmetic average of the particular year
shall be determined (such report may a amended y the
utility director of a city not nore than twice in any
one fiscal year) and (2) the arithmetic average of net
energy for load of each particular city for the preceding
fiscal year of the Agency shall be calculated, and (3)
if the estimate of the utility director is not timely
-13-
filed the average of net energy for load on the historical
12 month period shall be used until such estimate is
filed but if the estimate is filed the higher of the
calculations obtained under (1) and (2) above shall be
used as the estimated net energy for load. Within 10
days of the close of a fiscal year, the Executive
Director of the Agency shall redetermine the amount which
should have been paid in the preceding fiscal year and
the additional amount due shall be billed to the city
or credit shall be given to the city on the billing
which becomes due October 15. If the additional amount
due from a city is more than 5% of the amount paid by
the city during the preceding year, an amount equal to
10% of the amount due shall be added to the statement
and shall be paid by it.
Such payments shall be made on or before the 15th dby
of each month (commencing October 15, 1975), and the
Agency covenants that money received under this agreement
will be used only for the purpose of paying its maintenance
and operating expenses and only for items or expenses
which have been included in a proper budget or budget
amendment (including a temporary budget).
The amount to be ppaid for each kilowatt hour of net
energy for load shall be subject to adjustment from time to
time in the following manner:
(1) It may be raised if the Agency notifies the City
that the amount of income being received for the payment of
maintenance and operating expenses is not sufficient for the
purpose and that the amount being collected from each entity
contracting with the Agency is being increased proportionately;
such notice shall show the basis of the adjustment (increase)
so as to provide not less than the amount budgeted for such
expenses during the then fiscal year and not more than 110%
of such budgeted amount. No raise in the amount due from an
entity shall be effective until such entity has received 30
days notice of the revision, but a city may delay paying the
increased amount until 60 days after the receipt of such
notice of revision provided (i) it notifies the Agency in
writing of its intention so to do and (ii) pays the amount
due from the effective date of the increase on such sixtieth
day.
(2) It shall be decreased if the amount received by
the Agency for the payment of the maintenance and operating
expenses exceeds 125% of the amount shown in the annual
budget therefor (for the then current fiscal year) and the
millags rate will be reduced so as to provide not less than
the amount budgeted annually for such expenses during the
then current fiscal year and not more than 110% of such
budgeted amount.
Any surplus (an amount in excess of 110% of the amount
budgeted for such expenses) shall be either:
+ (1) applied as a deduction from the amount due from
the City during the next succeeding month or months, or
(2) maintained as working capital by the Agency, as
directed by the entities who provided the funds. In the
able^ce of a direction beingg received from the City, money
supplied by the city shall be applied as a deduction from
the amount due from the City Any s,irplus which is in
excesd'of 125% of the amount shown in the budget for maintenance
and operating expenses shall be returned to the entities who
supplied the funds. The credits or repayment of funds shall
bo'given or made in the same proportion as the funds were
originally paid for such expenses,
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It shall be the duty of the Executive Director of the
Agency to make the calculations with respect to the rate per
mill to be collected for each kilovdtt hour of net energy
for load.
The payments to be made under this paragraph (b) shall
cease and terminate when three monthly payments have been
made after the debt of the Agency is paid off, cancelled or
refunded.
(c) The amount to be paid by a city for the amorti-
zation of the debt of the Agency (herein sometimes called
debt service payment) shall be in the amounts and be paid on
or before the date shown:
(1) by the City of Bryan:
Date of payment Amount
9-15-76 through 8-15-77 $30,184.67
9-15-77 through 8-15-78 32,006.17
9-15-78 through 8-15-79 320002.25
9-15-79 through 8-15-80 27,389.92
9-15-80 through 8-15-81 27,213.00
9-15-81 through 8-15-82 27,341.67
9-15-82 through 8-15-83 27,341.67
9-15-83 through 8-15-84 27,213.00
9-15-84 through 3-15-85 1,740.07
$232,452.42 X 12 $2,789,429.04
plus 19.37. of the frees of tiie pAyirtg agent bank (for the payment
of the principal of and interest on the bonds on the next interest
payment date) shall be paid on or before February 15 and August
15 of each year upon being invoiced by the Executive Director
of the Agency.
The foregoing payments include the city's portion of
the money required to be paid into the reserve fund in the
years 1977 through 1979 under the resolution authorizing the
issuance of the bonds described in Section 4.01.
(2) by the City of Denton:
Date of payment Amount
9-15-76 through 8-15-77 $231459.60
9-15-77 through 8-15-78 24,875.23
9-15-78 through 8-15-79 24.887.75
9-15-79 through 8-15-80 21,287.50
' 9-15-80 through B-15-81 21,150.00
9-15-81 through 8-15-82 21,250.00
9-15-82 through 8-15-83 21,250.00
9-15-83 through 8-15-84 21,150.00
9-15-84 through 8-15-85 1.352.42
$180,662.50 x 12 $2,167,950.00
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plus 15% of the fees of the paying agent bank (for the payment
Y<, of the principal of and interest on the bords on the next interest
payment dxie) small be laid on or before Febr.::ry 15 and :!ug~et
15 of each year upon be ng invoiced by the Executive Director
" of the Agtv.ey.
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The foregoing payments include the city's portion of
the money required to be paid into the reserve fund in the
years 1977 through 1979 under the resolution authorizing the
issuance of the bonds described in Section 4.01.
(3) by the City of Garland:
Date of payment Amount
9-15-76 throu-h 8-15-77 $52,080.42
9-15-77 through 8-15-78 55,223.09
9-15-78 through 8-15-79 55,250.91
9-15-79 through 8-15-80 47,258.25
9-15-80 through 6-15-81 46,953.00
9-15-81 through 8-15-82 47,175.00
9-15-82 through 8-15-83 47,1.75.00
9-15-83 through 8-15-84 46,953.00
9-15-84 through B-15-85 3,002.25
$401,070.84 x 12 a $4,812,850.08
plus 33.3% of the fees of the paying agent bank (for the payment
of the principal of and interest on the bonds on the next interest
payment date) shall be paid on or before February 15 and
August 15 of each year upon being invoiced by the Executive
Director of the Agency.
The foregoing payments include the city's portion of
the money required to be paid into the reserve fund in the
years 1977 through 1979 under the resolution authorizing the
issuance of the bonds described in Section 4.01.
(4) by the City of Greenville:
Date of payment Amount
9-15-76 through 8-15-77 $11,573.42
9-15-77 through 8-15-78 12,271.75
9-15-78 through B-15-79 12,277.92
9-15-79 through B-15-80 10,501.83
9-15-80 through 8-15-81 10.434.00
9-15-81 through 8-15-82 10,483.33
9-15-82 through 8-15-83 10,483.33
9-15-83 through 8-15-84 10,434.00
9-15-84 through 8-15-85 667.17
$ 89,126.75 x 12 - $1,069,521.00
plus 7.4% of the fees of the paying agent bank (for the
payment of the principal of and interest on the bonds on the
next interest payment (late) shall be paid on or before
February 15 and August 15 of each year upon being invoiced
by the Executive Director of the Agency.
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The foregoing payments include the city's portion of
the money required to be paid into the reserve fund in the
years 1977 through 1979 under the resolution authorizing the
issuance of the bonds described in Section 4.01.
Except as provided in Section 4.07, the debt service
payments under this contract shall cease and terminate when
the debt of the Agency is paid, refunded, or refinanced.
(d) In the event Brazos exercises its option to purchase
a total undivided interest in the project (so as to increase
the percentage of ownership from 3% up to 407. as permitted
in the Preliminary Participation Agreement), and bonds of
the Agency are retired, an adjustment in the debt service
payment shall be reduced in accordance with Exhibit A attached
hereto.
SECTION 4.03: Should the City fail to make any payment
at thee t~s rrein specified, interest on such amounts
shall accrue at the rate of ten per centum (10%) per annum
from the data such payment becomes due until paid in full
with interest as herein specified. In the event such
payment is not made within sixty (60) days from the date
such payment becomes due, the Agency may institute a proceeding
for mandamus or mandatory injunction requiring the payment
of the amount due and interest thereon, such action to be
instituted in a court of competent jurisdiction.
SECTION 4.04: The payments required to be made by the
City un er t e terms of this contract shall be due and
payable as herein specified, and the City shall have no
right of setoff, recoupment or counterclaim against such
payment. The Agency shall never have the right to demand
payment of any obligation assumed by the City out of funds
raised or to be raised by taxation. Any obligations assumed
or imposed on a party hereto shall never be construed as a
debt of such party of any kind as to require it under the
Constitution and laws of this Stair Lo IeVy and collect
taxes to discharge such obligation, it being expressly
understood by the parties hereto that the funds required for
all payments due by City are to be collected from the sources
refsrred to in the next succeeding section.
S['CTION 4.05: (a) The City represents and covenants
that a11- payments to be made by it hereunder shall consti-
tute "operating expenses" of its electric system which
serves the inhabitants of the city with the effect that the
obligation to make such payments from such utility system
revenues under this contract shall be an operating expense
as defined by Article 1113 of the Revised Civil Statutes of
Texas, 1925, as amended.
(b) The City further agrees to fix and collect such
rates and charges for such electric services to its customers
as will, in combination with any other funds legally available
and reasonably assured for the purpose, make possible the
prompt payment of all expenses of operating and maintaining
such electric system and all payments contracted hereunder.
SECTION 4.06: The Agency may pledge all or part of the
payments to be received from the City under Section 4.02 (c)
of this agreement to the payment of the debt of tho Agency
(as such term is defined in Section 4.01).
SECTION 4.07: (a) The parties recognize that a city
may not withdraw from the Agency if the same would impair
the obligation of contract. Should a city determine it
wishes to withdraw from the Agency, so the same may be again
created under applicable law, it shall. give notice. to the
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• Agency at least 90 days prior to its anticipated withdrawal.
(b) Such withdrawal (so as not to impair contractual
obligations) shall have the following effect upon the
rights of the city so withdrawing:
(1) The city shall, from and after the withdrawal
date specified in its notice, not be obligated to
make any further payments for which provision is
made in Section 4.02 (b), the maintenance and
operating expenses of the Agency.
(2) The city shall be obligated to continue to
make the payments required to be made under the
provisions of Section 4.02 (c), the debt service
payments, provided however, if such withdrawal is
prior to the time the debt of the Agency is paid,
the total amount to be paid by the withdrawing
city may be paid in a single payment in which
event the interest on the debt of the Agency
(which is included in the calculations set fortis
in Section 4.02 (c) hereof) shall be calculated to
the next interest payment date on the bonds of the
Agency. The payment by such withdrawing city of that part of
the principal amount of debt it is required to pay
plus interest to the next interest payment date
shall extinguish all liability of such city hereunder.
The parties further agree that if such withdrawal
of a city is accomplished prior to or simultaneously
with the delivery of any bonds (other than those
described in Section 4.01) the total amount due
from the city shall be paid in 30 equal semiannual
installments (the first due within six months), on
dates established by the Agency and under such
circumstances, the total amount to be paid by the
city shall be equal to that part of the principal
amount of dibt the city is required to pay plus
interest at the same effective rate as borne by
the Agency's bonds then being issued.
(3) The city withdrawing shall retain the rights
specified :n Section 3.04.
1403 hThe ereof shall not thereafter apply to such
withdrawing city.
ARTICLE V
SECTION 5.01: Each proposed annual budget of the
Agency and EacF--proposed amendment (unless the Board of
Directors of the Agei.cy determines the adoption of the
amendment is an emergency measure) shall be transmitted to
each city at least 10 days prior to the approval thereof by
the Board. A budget amendment adopted as an emergency measure
shall be immediately transmitted to the city. Any representative
of a city may appear before the Board of Directors of the
Agency to protest a particular budget item (its inclusion or
the amount thereof), and it shall be the duty of the Board
to consider such protest, and if the same is not granted
(and the budget item revised in accordance with the protest)
the Board shall spread upon its minutes the reason therefor
and supply a copy of such minutes to each city. The initial
budget of the Agency, attached hereto, is hereby approved by
each city executing this contract, but (except as provided
in Section 5.06) it shall not hereafter be necessary for any
city to approve the annual budget or amendments thereto.
SECTION 5.02: The annual budget of the Agency shall
F hares ter ave two major catagoriea, one of which shall be
for•Maintenance and Operating expenses and the other shall
be 'for Debt Service.
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Maintenance and operating expenses shall cover all
expenses of the Agency except what is included in (i) the
budget for Debt Service, and (ii) the Capital Project Budget.
Expenses which, under standard accounting practices, should
be included as expenditures on a capital project shall not
be included in the annual budget or amendment thereto as
maintenance and operating expenses unless the governing body
of each city approves a contrary treatment, provided however,
this pruvision shall be effective beginning with the budget
year 1976-1977.
The Debt Service portion of the annual budget shall
include all payments for the principal of and interest on
the bonds issued by the Agency as well as payments required
to be made for the payment and sectirity of such bonds (including
fees of the paying agent bank). The Executive Director of
the Agency (as its Budget Officer) shall compute the amount
actually required to meet such Debt Service requirements for
the ensuing fiscal year and such amount shall be the amount
budgeted for such purposes without further action being
taken.
SECTION 5.03: In the event a budget for the ensuing
fiscal year as not be,in adopted on or before the first day
of the fiscal year, the total amount budgeted for maintenance
and operating expenses for the preceding fiscal year shall
be the total amount of the temporary budget for such purposes
for the ensuing fiscal year. The temporary budget shall be
effective only until such time as a permanent budget has
been finally adopted and approved.
The Executive Director of the Agency shall be responsible
for the allocation for expenditure of the total amount of
the temporary budget until a permanent budget is adopted and
approved.
SECTION 5.04: A Capital Project budget is a budget of
expen lures For -the providing of specific projects except
that for the initial series of bonds all expenditures for
which provision is made in Section 3.01 shall constitute a
single capital project.
SECTION 5.05: The Agency covenants that it will operate
its faac Tres T-n an efficient and economical manner and
that it will follow prudent utility practices in the conduct
of its affairs.
SECTION 5.06: The parties hereto recognize that the
payment of-Th maintenance and operating expenses of the Agency
constitute a first char against the revenues of the Agency;
that it is the Agency Rich has the responsibility of operating
and maintaining its facilities so as to provide adequate
service, but that the cities need a measure of protection so
as to protect its citizens and rate structure against rapid
and unforeseen changes in the budget.
Accordingly, the parties agree that:
(1) Except as provided in paragraph (3), no amendments
or amendments to the operating budget of the Agency shall be
adopted in any one fiscal year which increase the estimated
annual payments of a particular city by more than 20% without
the approval of the governing body of each city whose pay+.enti
are so increased. In making such estimate, the Agency shall
utilize the higher of (1) the net energy for load of a
particular city for the preceding 12 months or (2) the
estimated net energy for load for a particular city as
} repared by the director of utilities of the particular city
~Y lor the following 12 zonthe it~'.e °9 t'imate r_~uired in Section
X. 4.02_(b) hereof, and the amount so determined shall be
€t` multiplied by the millage rate then in effect (at the time
of the budget amendment) under Section 4.02 (b).
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(2) Except as provided in paragraph (3), each subsequent
annual budget for maintenance and operating expenses may
increase the total amount budgeted for such purposes by no
more than 40% over the final approved budget of the prior
year without the prior approval of the governing body of
each city.
(3) If a weighted majority (as set forth in the Rules
and Regulations of the Agency) and six directors of the
Agency approve a budget or a budget amendment, the same
shall be effective.
For the purpose of this Section the annual operating
budget for 1975-1976 shall be considered as being entirely
for maintenance and operating expenses.
ARTICLE VI
SECTION 6.01: The parties hereto recognize that the
Agency was created for the purpose of providing electric
energy to pubii.c and private entities on a wholesale basis;
that it is not the purpose of the Agency to usurp the powers
of the cities or to enter into competition with them, and
that such limitation was the intent of certain provisions of
Section 4a (a) of the Act which provided for the creation of
the Agency.
The Agency covenants that during the term of this
agreement it will not engage in any utility business other
titan the generation, transmission, and sale or exchange of
electric energy to the participating public entities (the
cities) and to private entities who are joint owners with
the Agency of an electric generating facility located within
this State.
ARTICLE VII
SECTION 7.01: Subject to the third paragraph of this
Section; t~Fie oMgation of each City to promptly make all
prescribed payments shall commence on the date specified in
Section 4,02 and continue to be made on the dates therein
specified.
It is contemplated this contract will be executed by
and between the Agency and each of the Cities of Bryan,
Denton, Garland and Greenville, and that a similar contract
will be exeucted between the Agency (or the Corporation, its
Agent) and the Brazos Electric Power Cooperative; that the
,X" combined payments to the Agency b reason of such contracts
will be adequate to provide for the payment of (1) the
budgeted and anticipated administrative, maintenance and
operating expenses of the Agency, and (2) the debt of the
Agency during the time the same is outstanding,
At such time as (1) the Agency (or its Agent) has
executed contract of such import, and (2) copies therof
have been filed with each city, and (3) an official of the
Agency certifies that in his opinion such contractual obligation
meets the requirements of the preceding sentence, this
contract shall be fully operative and in force. When this
contract is fully operative and in force, the obliggation of
r each city to make the payments herein prescribed stall be
absolute, unconditional and not subject to revocation or
diminution in any manner,
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til
e _irv .3n64 nnfr aaaume by the execution hereof anv
obligation to pay any amounts to the Agency or others other
th3!? AR 1±!!rPin nrovided. Soecifically, a city does not
Yv .
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guarantee the payments of any amounts due from other entities,
the sole purpose of the preceding paragraph being to give
assurance to each City that the other entities have joined
in the cooperative endeavor.
SECTION 7.02: Subject to the provisions of Section
8.14 0o_ tTFe_Preliminary Participation Agreement, Lids contract
may be ci,anged and modified only with the consent of the
governing odies of the cities of Bryan, Denton, Greenville,
Garland and the Agency. Such modification may be requested
by any of such parties, in which event a joint meeting of
the governing `+odies or of their duly authorized and ap ointed
representdtives shall be held not less than fifteen (15~
days after the giving of such notice. At such joint meeting
the suggested changes or modifications shall be considered,
discussed and settled. No such change or modification may
be made which will affect adversely the payment when due of
all monies required to be paid by a City under the terms of
this contract and no such change will be effective which
affects adversely or causes a violation of any covenants
contained in the resolution or order authorizing the issuance
of the Agency's bonds.
If for any reason a City may desire additional studies,
services or the construction of any additional facilities
and same are within the legal and economic capabilities of
the Agency, provision therefor shall be made by means of a
supplement hereto, the terms of which are to be negotiated
between such City and the Agency. Nothing herein shall
restrict the power of the Agency to enter into additional
contracts with additional contracting parties provided the
revenues of this contract are not pledged or hypothecated in
any manner thereunder.
SECTION 7.03: This contract shall be subject to all
valid rules, regulations and laws applicable thereto, as
promulgated by the United Si:ates of America, the State of
Texas, or any other governmental body or agency having
lawful jurisdiction or any authorized representative or
agency of any of them.
SECTION 7.04: The City agrees that the A eILcy or its
Agent may wen permitted by existing easement) have such
easements over any easements, right-of-way or property held
by such City so that the facilities and required equipment
may be appropriately provided.
SECTION 7.05: (a) If for any reason of "force majeure"
any of-ItRe par-tea hereto shall be rendered unable wholly or
in part to carry out its obligations under th'.s agreement,
other than the obligation of the City to makq the payments
required under the terms of Article IY hereof, then If suet
party shall give notice and full particulars of such reasons
in writing to the other party within a reasonable time after
the occurrence of the event, or cause relied on, the obli-
gation of the party giving such notice, so far as it is
f. j affected by such "force majeure", shall be suspended during
,,-1 the continuance of the inability then claimed, but for no
s;T' longer period, and arty such parties shall endeavor to remove
4:~P or overcome such inability with all,reasonable dispatch,
#The term "force majeure" as employed herein shall mean acts
of God, strikes, lock-outs, or other industrial disturbances,
;_i acts of public enemy, orders or actions of any kind of the
Government of the United States or of the State of Texas or
any civil or military authority, insurrections, riots,
it
epidemics landslides, lightning, earthquakes, fires, hurricanes,
IF $torsss, floods, washouts drou hts, arrests, restraints of
ar~r gg
government and people, civil disturbances, explosions,
.
c ~I _21-
V4;
Y
breakage or accident to dams, machinery, pipelines, or
canals or other structures or machinery, on account of any
other cause not reasonably within the control of the party
claiming such inability. It is understood and agreed that
the settlement of strikes and lock-outs shall be entirely
within the discretion of the party having the difficulty,
and that the above requirement that any "force majeure"
shall be remedied with all reasonable dispatch shall not
require the settlement of strikes and lock-outs by acceding
to the demand of the opposing parties when such settlement
is unfavorable to it in the judgment of the party having the
difficulty.
(b) No damage shall be recoverable from Agency by
reason of the causes above mentioned.
SECTION 7.06: Any notice, request, demand, statement
or bilee viUed-for in this agreement shall be in writing
and shall be considered to have been duly delivered when
sent by registered or certified mail, addressed as follows:
Agency: Texas Municipal Power Agency
Forest Park Center
7111 Bosque Blvd.
Waco, Texas 76710
Attention: Executive Director
Cities: City of Bryan
P. 0, Box 1000
Bryan, Texas 77801
Attention: Mr, J. Louis Odle, City Manager
Cio:y of Denton
Civic Building
Denton, Texas 76201
Attention: Mr. Jim White, City Manager
City of Garland
P. 0. Box 189
Garland, Texas 75040
Attention: Mr, Charles Duckworth, City Manager
City of Greenville
P. 0. Box 1049
~ Greenville, TeXAA
Attention: Mr, Jim Deberry, City Manager
as the case may be, except that routine communications may
be sent by ordinary mail and except that either party, by
the filing of an appropriate written notice to the others,
i may specify some otFF.Ar i,.dividual to whom communications
thereafter are to be addressed.
SECTION 7.07: The Agency covenants that it will
` enforce tie oblgations of each City heretmder (aft well Rs
any obligations contained in similar contracts with additional
contracting party) as may be required to accomplish the
purpose of this contract. Either party may enforce any
tr obligations hereunder owed by it by the other party.
SECTION 7.08: The Agency and each City agree that in
the even oT deTault or threatened default in the payment of
1.,. principal of or interest on the debt of the Agency, any
court of competent jurisdiction upon petition of the holders
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;i. f'
of 25% of the principal amount of the then outstanding bonds
of the Agency shall appoint a receiver with authority to
collect and receive all resources pledged to the debt of the
Agency, enforce all rights arising from default, if any, by
any City, or additional contractiri; party, in making payment
under the agreement, employ and discharge agents and employees
of the Agency, take charge of the pledge,; funds on hand and
manage the proprietary affairs of the Agency without consent
or hindrance by the Agency. The court may further vest the
receiver with such powers and duties as the court may find
necessary for the protection of the :solders of the bonds.
SECTION 7.09: The parties hereto agree that if any of
the provFs-fons oT this contract contravene or be held invalid
under the laws of this State, Same shall not invalidate the
whole agreement but it shall be construed as though not
containing that particular provision and the rights and
obligations of the parties shall be construed and in force
accordingly.
SECTION 7.10: This contract shall terminate and be of
no force and effect ninety (90) days after the debt of the
Agency has been paid off, cancelled or refunded.
IN WITNESS WHEREOF, the parties hereto, acting under
authority of their respective governing bodies, have caused
this contract to be duly executed in several counterparts,
each of which shall constitute an original, all as of the
day and year first above written.
CITY OF BRYAN, TEXAS TEXAS MUNICIPAL POWER AGENCY
By: BY ~`id~
Mayor, ~;i o an, Texas es nt, board of rectors
ATTEST: ATTEST:
ecre ar City o ryan, ecretary, Board o D rec ors
CIO rd,'-
Texas
(City Seal) (Agency Seal)
CITY OF DENTON, TEXAS CITY OF GARLAND, TEXAS
By BY
4 K,
m7wo t 7 De 7d, 95 yor, City o Garland, Texas
ATTEST: ATTEST:
ecretary, Cy o enton •C ty Se et t ,
Texas Texas
(City Seal) (City Seal)
_29_
CITY OF GREENVILLE, TEXAS
By : L7!ll~f~ld~ -r
Ray-or, City ree e,
Texas
ATTEST:
tv Clerk, City of Greenville,
Texas
(City Seal)
THE STATE OF TEXAS ;
COUNTY OF BRAZOS ;
BEFORE ME, the undersigned authority, in and for the said
County on this day personally appeared MR. LLOYD JOYCE, Mayor
of the City of Bryan, Texas, knowr to me to be the person
whose name is subscribed to the foregoing instrument and known to
me to be the Mayor of the City of Bryan, Texas, and acknowledged
to me that he executed the same for the purposes and consideration
therein expressed and in the capacity therein stated as the act
and deed of said CITY OF BRYAN, TEXAS.
GIVEN UNDER MY HAND AND SEAT. OF OFFICE this the day of
r, 1975.
(Notary Seal) otary u ic, Brazos County, Texas
THE STATE OF TEXAS ;
COUNTY OF DENTON ;
BEFORE ME, the undersigned authority, in and for the
said County on this day personally apgeared MR. TOM JESTER,
Mayor of the City of Denton, Texas, known to me to be the
person whose name is subscribed to the foregoing instrument
and known to we to be the M- yor of the City of Denton, Texas,
and acknowledged to me that he executed the same for the
purposes and consideration therein expressed and in the
rapacity therein stated as the act and deed of said CITY OF
DENTON, TEXAS.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this the J
day of Sap"wbar, 1975.
0~1 ~6t~
_ I
t lie 0. 1- A
(Notary Seal)
Notary Pu 'c, Denton County, Texas
-24-
T
THE STATE OF TEXAS §
COUNTY OF DALLAS §
BEFORE ME, the undersigned authority, in and for the
said County on this day personally appeared MR. DON RAINES,
Mayor of the City of Garland, Texas, known to me to be the
person whose name is subscribed to the foregoing instrument
and known to me to be the Mayor of the City of Garland, Texas,
and acknowledged to me that he executed the same for the
purposes and consideration therein expressed and in the
capacity therein stated as the act and deed of said CITY OF
GARLAND, TEXAS.
Is GIVE NDE MY HAND AND SEAL OF OFFICE this the
day of 1975.
(Notary Seal) o Public, D as County, Texas
THE STATE OF TEXAS §
COUNTY OF HUNT §
BEFORE ME, the undersigned authority, in and for the
said County on this day personally appeared MR. CHARLES SIVLEY,
Mayor of the City of Greenville, Texas, known to me to be
the person whose name is subscribed to the foregoing instrument
and known to me to be the Mayor of the City of Greenville, Texas,
and acknowledged to me that he executed the same for the
purposes and consideration therein expressed and in the
capacity therein stated as the act and deed of said CITY OF
GREENVILLE, TEXAS.
GIVE PI DER MY HAND AND SEAL OF OFFICE this thesd
day of ~ 1975
(Notary Seal)
Notary Public, Hunt county exaT s
THE STATE OF TEXAS §
COUNTY OF Ac--:4 §
BEFORE ME, the undersigned authority, in and for the
said ounty on this day personally appeared exedLa/
fr. , President of the Board o rectors o
t e POWER AGENCY, known to me to be the
person whose name is subscribed to the foregoing instrument
and known to me to be the President of the Board of Directors of
TEXAS MUNICIPAL POWER AGENCY, and acknowledged to me that he
executed the same for the purposes and consideration therein
expressed and in the capacity therein stated as the act and
deed of said TEXAS MUNICIPAL POWER AGENCY.
GIVEN UNDER IIAt~D At:D SEAL OF OFFICE this the TO
day of Se r, 1975. SAN JORDAN
TAP MCC, iR"IfSCOUMTY
NotarySeal) Notary Public, r#TAV15 County, Texas
A /
-25-
,
Draft 42
EXIIIBIT "A" 9/16/75
TFXAS MUNICIPAL POWER AGENCY
Formulae To Be Used In Connection With
Debt Service Payment Adjustments -Brazos
Purchase Option
A. All funds received by Agency from Brazos shall be iiftnediately used
to reduce (tali) outstanding Bonds of Agency
B. Adjustments to Payment of Debt Service
1. Brazos Purchases Up To An Additional 17% of the Total Project
a. Debt service requirements are adjusted to eliminate
requirements of called Bonds.
b, New payments equal to a. times product of:
Brazos - 25.0;,
Bryan - 19.3';
Denton - 15.0;
Garland - 33.3
Greenville - 7.4<
2. Brazos Purchases Over An Additional 17% of the Total Project
a. Debt service requirements are adjusted to eliminate
requirements of called Bonds.
b. Brazos - New payments equal to a. times product of new
percentage calculated as follows:
r. = % of Agency's debt requirements to be paid by
Brazos
y = a of total project owned by Brazos
z = Total % of participation desired by Brazos
in total project (both owned 3 contracted)
X = (z/1-y) - (Y/1-y)
Example: Brazos purchases an additional 25% (owns 28% of
total project) of total project and wants total
participation to be equal to 40%
y = .~R
z=.40
X = (.40/1-.28} - (.28/1-.21)
x cri`n`r`v - . 3889
x .1667
C. Cities - Each City's new ;aynnents are equal to a. less b. times:
Bryan - 25.7'
Denton - 20.0',
Garland - 44.4%
Greenville - 9.91
-sr.
PA PA
1491E 1
1FtAS WOCUAI KPAR WENCT
1975_1916 RIXAT
ESTIMIf OF RM WES 9
Fool % _ DC E. Ibl. DFC. 4M FEI. Ku NAT JUNE _ JU1T _kID~ SEPT. TolAl
►revioeal3 autWlze4 $ s S f s s S t f 3 f s s
by MP (1) 49,000 49,780 95.70
swclerye of .15 mill
Wr hh (2) 53,300 S3,300 $3.300 51,700 DOW 51,700 53,3'b DOW 67,300 63.300 53.37) 57.)00 639.60
Short hen fteaecle9 (3) }.20 1.000 911.00
Total s 1D2,300H,:S0,7005 53.)W$ S).3005 53,3001 67,3001 $7.3005 53.3005 53,3005 53.3005 57,3005 S3.X69,919.30
ESTIIOETT OF
[i►fh01111RES
WA ANlals trot No., yt'
a1 dtrecuncf~
' ,Nee (1~ S I,SOOf I,SOOS I.SOOS I,SOOf 1,500E 4.5005 1.5005 <,SOOS 1,5005 1,5005 I.SOOs 1,5001 SI.Od
TM owatlos A
facllitie4 eape*Se 48.650 59,350 $0.150 49,380 49,650 17,660 17,950 45,900 48,40 45,9% 46.150 46.256 545,7
TI'I eaWedltures 49. DDO 49,700
elwsly authorized
VTWF y
Srttatal s 102,1505 113,550$ $4.EW$ $3.6005 $1,1805 52.1605 52,4805 60,4809 S2,950S 50.4SOS S0,7S0$ SO,Ms
SWt Ten financial 26). 7,000 271, 4.000 261, 7.OOa 1.239.003 1.111X000 Z, 176,0_ _ 561 000 587.000 698,000 201
Total $3,369,15p5i,78).SSOE1,321.65051,266,66051,165,18951,230,1605 616.M$ 636.41105 750,9505 60.4505 $0,7505 50,75059,939,1
t1-IOCAT101 TO KKKIts
a ze
ml expense authorized
►y 9115 f 15,000$ 15,900E $ s S f f t s S f S 70,
T1pi Oppeerratioe I rac. 20.000 20,ID0 28.000 20.100 20,101 2D,o6U 20.100 10.100 20.000 20.100 MJDO 20.000 240.
SWtO Tam Financial 4- a -a0- $ 'a •a
Total f 3S,IM 76,000$ 20.000E 20,100) 20.100$ t0.000$ 20.1005 20.170E to.000E 2iijk,$ 20.1005 20.000E 271,7
tME autwfzsd
by WA s R.500E 8.600 s s s t ( s s S s s s 17,1
1"1 Owatim I fic. 1.400 7.400 7.400 1.400 7.400 7.600 1.400 7.400 7.100 7.400 7.400 7.400 88,30
TVA Oaeratfeq 1.020 I,wO 1,020 t.On 1.020 1020 1.020 I.On I,OM 2,010 11020 I'm 12,2
"04 7" ri"=109 . 116- -a -0- -a -o• _•0- __00.__0_ a •a -0- _0__a
TMaI f 14,9209 17.020 f 1.420$ 8.420$ 6.420$ 9.120$ 6.420E 1,110$ 1,420$ 6,420E 6,420 /.4M 136,1
!e!t!S •
W1 tgeiw eethwiled
yr W* f S.lloof 6,800 S s f S $ $ $ f f Z f 1). 60
M7 OFeret%o a roc. E.350 9.340 5.350 9.340 1,350 $1140 SIM 6.310 6.750 6.)10 6.390 6,SN 64.1
vio /~e 61011 170 $70 970 670 970 910 $71 910 970 970 910 KO 11
flalrt Two rimming -0. a -0• -
TMa) s 13.1205 13,110 f 6.320E 6,310s 6.3205 6,314 6,3201 9,310$ Ix%$ 6,1161 6,310E E,310s 69, 30
Hr1 aM
1M1 Wee" aoehortaW S 1S,)0os Is'M f S f s f i f f s 3 s 30.
Mley OWrethen a fat. 13.630 13,630 0,810 11,439 DIM 13,340 1),83) 13,830 13,91) 13,830 1).tA IIA40 166.
1T71A
°~`+r att0o 2.M 2,050 2,050 2,059 1,050 1,950 1,050 2,050 1,050 1,060 2.050 2,050 24
srrtt7unct./ o--4_ -6
TOUT s 31,1006 )1,080 1 15,696E 1S,0605 is.ncs 15,890t Is,8d0E 1s,860s E5.190S 35.6905 Ism" ISAW tu,1
~aetlt• .
TMI aut9erfnd
6y TEl►A f 7.700E 3,300 f f f f f ( s f f f f i,
Ml 0►eratfw 6 Rc. 2.170 2,170 2,110 2,160 1.170 2.170 1,170 2.160 2.110 :.170 2,170 1,560 26,01
iNA 630 attee 460 460 660 460 460 460 460 460 460 460 460 460
awt°Tom rimming 4- •00 -0- _ - .5,_ -0- _0_ a_ a _7, _0
Trul f SAM 5,970 f 2,630$ 2,620$ RIMS 2,630) 1.634S 2,6201 ,,6301 2.630E j630$ 2,6101 30,1
i
a
TEXAS MUNICIPAL PO6,ER AGENCY
' Estimated Financing Requiremggn s For
First Ycar's. Activities la
Total Allocation
Facility/Activity Estimated TMPA Brazos
Cost 97.05 3.0%
1.• Fuel Development
T Bryan Lignite $ 51571,500 $ 5,404,355 $167,145
b. Other Lignite 159,000 145,500 40500
c, Western Coal 25 000 24,250 750
Subtotal 5,746,500 5,574,105 172 395
2. En ineerin Studies
a. as Turbines $ 50,000 $ 48,500 $ 19500
b. Economic Dispatch 101,000 103,790 39210
c. Comanche Peak 50,000 480500 11500
d. Pumped Stgp 4e 125,000 121,250 3,750
e. Microwave(( 11 550,000 533,500 16,500
f. Transmission 40,000 38,800 19260
g. TIS 5,000 4,850 150
h. Fuel Management 10,000 90700 300
i. Cost of Service 4 000 3 880 120
Subtotal 941,000 912 70 28.230
3. Construction
a. Interconnect with Private
Utilities $ 1,0,40000 ; 11052,480 ; 32,520
b. Olinger-Greenville line 1,000,000 973,000 330,000
c. Oil Storage Facility Acq. 430 000 417,100 12,900
Subtotal „ 2,514,000 2 438 580 75 420
.
Total Facility/Activity EsI.Costs $ 9,201,500 $ 8,925,455 $276,045
4. Cost of F`,nancin
a. egal b Fiscal (11) $ 106,250 $ 106,250 $ .0-
b. CApfto! zed Interest(c) 743,750 743,750 -0-
s. caritalized Reserve Fd.(d) 849 545 849 545 -0-
Subtotal
Grand Total ;10,901,045 $10,625,000 -276 045
lal Based on revised contrast prices
b Includes construction of facilities
c 12 months interest at 7%
d Equal to h of one average annual requirement (approximate)
9/10/75
AHE
L I
1
TABLE 2
EXPENDITURES PREVIOUSLY AUTHORIZED BY TMPP
TO BE SPENT IN NEXT TNO 14ONTHS (6)
DATE
EXPENDITURE AUTHORIZED ALLOCATED TO AMOUNT
Transmission Studies September 8 All ; 71500
Microwave Tower Site Options September 8 All 11000
Power Cost Allocation Study August 28 All 20,000
Lone Star Negotiations July 31 Cities 19,000
Pitts Gas Testing July 31 All 1,000
Economic Dispatch Phase 1 All 139200
Viil3ge Bend Phase IA July 31 All 259000
Bryan Lignite (Reserve fund) September 8 All 101000
TIS Research June 26 All 29000
S98,7D0
ALLOCATION TO HEHbEkS (7)
MEMBER ALLOCATION
Brazos ;30,900
Bryan 17,100
Denton 13,600
Garland 300500
Greenville b
;!98,700
4
f
ji
f
TPP,L ~ND(i4t~
IA6L[ 1
ROOT AMINISTCATION. ROOF FSS1OUl, OPERATING
AAD FACILITIES R1IDLCT _i82,___
OETWER 1975--SFPIMM 1974
POOL UN1OISTRA1104 OCT. IIdY. DEC- JAN. 716. WlR_ APR-. MAY JUNE _ JUti AUG. SEPT. IOTA' _
Salaries(9) 1 1,690 ( 12,250 1 12.250 1 11.430 6 17.480 S 17,430 f 1),480 1 13.480 $ 14.150 f 14.150 s 14.150 1 14,150 s 156,150
General OfrIC4 (10) 3.900 3,000 3.100 3.100 I'm ).Wo 1.700 7.3M 1.400 7,100 3.566 3.500 42.900
lraeel and aeetiats 2,000 2,000 2,100 2,100 2.200 i,2M 1,100 1.300 21400 2,400 2,610 2,500 22,000
Priatiag, trHatng, p,Etlu-
tlaas S S00 600 600 700 IM POO -8M 960 900 Loo _ 11000 9.000
SAtotal 117,050 6 17.750 6 18.0% 6 19,280 $ 19.:80 S 19,560 S 1!,680 6 19,860 S 20.250 S 20.850 6 21,150 S 21,150 S 2)5,050 i
PRORESSIOWa EVEICES AAA
STUDIES- _
1e9a1 fees (11) 1 10.000 6 10,000 S 10.000 I 8,0,10 S 8.000 S 6.000 S 6,CW s 4,003 1 4,000 3 4,000 S 4.000 s 4,000 S 11^0
Gat COON, toot (12) Sw 500 500 5M VA SOO 500 Soo SOO sw flow
T1S R4rtIc Ipatfes S00 Soo 500 SOO Sw S00 SOO No S00 500 Sw 500 6,000
1Wdtt and oral report 10,000 10,000
Railroad Camiss'Oa Nearlr4s
{13) 200. tw 200 200 200 200 200 200 200 200 200 200 1,400
pool laar 2,500 2,500
ri"W4 Tun Eape,ues 1,Ow 1,000 11000 1.Ow 1,000 I.Ow 1.000 1,000 $.aw
Lead and tsaeratlon studies 200 200 200 200 290 200 200 too 200 200 100 200 2.400
Elm stadtn 100 100 100 100 100 100 ]w 100 Wo 100 100 100 1,200
IN" and EdocatIM Sw So0 500 S00 SOO Soo 500 500 500 $00 SOO S00 6,000
Ref-tlatims 6 consultants 5,000 5,000 5.OM $.ODD 5,000 51000 5,000 51000 5,000 5,000 5,000 5,000 60,000
lliscollaneovt SWlIn 2.000 2.000 2Aw LOW LEE T.000 tl000 2,000 2.000 _ P,," 2.000 2.000 24.000
faatstal s 19.60 6 29.500 s 201000 1 191000 1 18,Ow s 16,000 s 16.000 S 14,Ow $ 1S,S.'V $ 13.000 S U,OOO 1 13,Ow S 205.6-90
7001 OPERATING ElnkA
Pool and Pitt$ OispatUtag 1 1,600 s 1,600 s 1,600 s 1,600 6 1.500 I LIDO S 1,600 s ),GOO s 1,600 s 1,600 s 1.600 s 1,600 s )9,tw
TMILITIES EIPME
Ireras Aa,e4 I 9,000 S 9.000 S 9.000 S 9,000 6 9,000 S 9.D00 $ 9.000 6 9,000 S I.Ow S 9,000 6 9.000 $ 1.000 6 106.000
Oil Tantael aperati0a 1.500 1i50Q I.SM 1 ~S00 _ 'soo _~Im .-1,-500 1,SOO 1,900 ,'SS00 5.500 ]1.000
Wotal s WSW S IO,SOO S 101500 S 10,Sw S 10.500 1 10,500 $ 10,500 s IO,SM S 10,500 S 10,500 110,SOO S 10,500 S 126,000
total 148.650 S $9,350 $ 50.150 f 49,380 s 49,680 1 47,660 S 47,980 S 47,960 6 48.450 $ 45,950 S 46,150 146.250 1 595.750
AttOC4lFdf 10 yKks(14)
Dram f 20.1w 1 20.100 s 20.000 s 20.100 s to.1w s 20,000 S 20.1 DO s 20 too s 20.000 s 20.100 3 20.100 S 20.000 s MON)
7,400 7,4DO 1,400 1.400 7.400 1.400 ' 7.400 7.400 7.500 7.400 1.400 7,400 I8,W4
. ! i~tge 6,350 5,710 S, 150 5,340 f.3SO 5,340 6:150 f, 340 5,350 5,340 6,350 f,NO $4,140
Garland 1),6)0 11,630 13,'40 13,830 13,930 17,840 :T,SM )1,170 1).840 11,830 13,430 11,840 1ts'"O
iroardlla 1,170 2,170 1,170 2,160 2,170 2,170 2,360 1,170 1,170 2,170 2,110 2,760 x,010
S 685,750
,
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FOOTNOTES
(1) Recent authorizations shown in Table 2.
(2) As contained in Cities-TMPA agreement.
(3) As shown in financing documents and Table 5.
(4) Allowance for miscellaneous expense of TMPA not contracted to TPPI.
(5) Short term financing is to be rolled into first long tern financing.
(6) Amounts shown in Pool minutes. Some costs not shown are included in
short term financing.
(7) Allocated on 1974 peak loads.
(8) Expenses not included in short-term financing.
(9) Assumes staff of 7 with cost of living increase in January and merit
increase in June.
(10) Assumes moving expenses for two plus addition of office furniture,
calculators, etc.
(11) Assumes decline in legal needs as organizational relationships are
firmed up.
(12) Continuing services after Lone Star negotiations.
(13) Possible future hearings.
(14) Allocated on 1975 energy.
(15) Assumes decline in deliverability. Price based on =1.524/mttu +
;.20 transportation through August, then $1.90 + $.30 transportation.
(16) Gas received but not paid for in 1974 and 1975.
(17) Based on 1974 peak loads.
(18) As shown in short-term financing documents.
(19) TMPA assumes previous costs of members in October.
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Draft&No. 3
a ~ ~ rl 10-3-75
F+
A RESOLUTION by the Board of Directors of the
Texas Municipal Power Agency, relating to the
authorization and issuance of $10,625,000 "TEXAS
MUNICIPAL POWER AGENCY REVEF''UE BONDS, SERIES
1975," dated September 15, 1975, for the purpose
of providing funds with which to discharge certain
costs and expenses oL the Agency in connection
with the acquisition or construction of certain
jointly owned electric facilities, and to provide
engineering, planning and financing expenses;
providing the terms and conditions and specifications
for such bonds; pledging certain revenues of the
Agency in payment of such obligations and interest
thereon; providing further recitals and covenants
incident and relevant to said bonds and the purposes
of this resolution.
WHEREAS, the Texas Municipal Power Agency has heretofore
been.created as a municipal power agency, a municipal cor-
poration, a political subdivision of the State and a body
politic and corporate, pursuant to the provisions of Chapter
166, Acts of the 63rd Legislature, Regular Session, 1973, as
amended by Chapter 143, Acts of the 64th Legislature, Regular
Session, 1975, (codified as Article 1435a, R.C.S., 1925, as amended); and
WHEREAS, it has been determined that this Agency should
proceed with the authorization and issuance and delivery of
an initial series of bonds in order that appropriate planning
may be provided and certain facilities may be acquired by
the Agency as a joint project by and between the Agency and
its constituent members (the Cities of Bryan, Denton, Garland
and Greenville) and the Brazos Electric Power Cooperative,
Inc., and this Board has determined that the Agency is fully
empowered to issue its revenue bonds for the nnrnngea and
under the provisions, conditions and in the manner hereinafter
set forth; therefore,
BE IT RESOLVED BY THE BOARD OF DIRECTORS OF TEXAS
MUNICIPAL POWER AGENCY:
ARTICLE I
Definition of Terms
SECTION 1.01: Definitions. Unless the context shall
indicate a contrary meaning or intent, the terms below
defined, for all purposes o: this resolution or any resolution
amendatory or supplemental thereto shall be construed, are
used and are intended to have meanings as follows:
(a) "accountant" or "certified public accountant" -A
certified public accountant or firm or corporation of certified
public accountants, selected by the Board, which individual
or firm or corporation has no substantial interest, direct
or indirect, in the Agency, and in the case of an individual
is not a director, officer or employee of the Agency, and in
the case of a firm or corporation does not have a partner,
director, officer or employee who is a director, officer or
employee of the Agency.
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(b) "Act" - Article 1435a, R.C.S., 1925, as amended.
(c) "Agency" - The Texas Municipal Power Agency (the
issuer) heretofore created and established pursuant to
the Act.
(d) "agreements" - (i) The certain agreement styled
"ContracL for Development of Fuel Resources, Planning Electric
Generation Facilities and Performing Certain
Duties" between the Agency and the Cities of Bryan,
Denton, Garland and Greenville, Texas, dated as of the
15th day of September, 1975, as the same may be
erea ter amended or supplemented, and (ii) the agreement
styled "Preliminary ?articipation Agreement" by and
between the Agency, the Texas Power Pool, Inc. and the
Brazos Electric Power Cooperative, Inc., dated as of
the 15th day of September, 1975, as the same may be
hereaer amended or supplemented.
•(e) "Board of Directors" or "Board" - The Board of
Directors of the Agency.
(f) "Bond Fund" - The Fund created under the provisions
of Section 5.03 of this resolution.
(g) "Bond Reserve Fund" or "Reserve Fund" - The Fund
created under Section 5.04 of this resolution.
(h) "Bonds" - The bonds which are authorized to be
issued by this resolution.
(i) "Construction Fund" - the Fund created under Section
5.07 of this resolution.
(j) "depository" - Such bank or banks at any time selected
by the Board of Directors to serve as depository of the Agency.
(k) "eligible securities" - Those securities which
under Section 5.08 hereof are declared eligible for investment
of funds herein established.
(1) "gross revenues" - The entire income and revenue
of the Agency, including all tolls, interest on investments,
rents, fees, charges and rates derived from the operation of
the system or ownership of its properties. The term does
not include payments (i) for an ownership interest in a
Joint Project, or (ii) received as a single payment from a
viciuber City of the A ency upon its withdrawal [as contemplated
by Section 4.07(b)(2~ of the agreement between the Agency
and the cities of Bryan, Denton, Garland and Greenville
described in paragraph (d)(i) of this Section), but otherwise
includes all money received by the Agency from any source.
(m) "Joint Project" - A project undertaken by the
Agency in cooperation with any other entity (a3 such term is
defined by the Act) where the Agency and such entity each
have an undivided ownership interest therein.
""aadatory Dedcmptien Fu,.!" - The s'6ecial fund
(n)
created and established in Section 5.06 of this resolution.
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(o) ''net revenues" - Gross revenues less operating and
maintenance expense.
(p) "operating and maintenance expense" - All expenses
incurred in the operation and maintenance of the system
including salaries, labor, materials and repairs necessary
to render safe and efficient service. The term shall include
all payments of the Agency for work done and performed for
it under contract, as well as current premiums on insurance
policies of every kind and nature, deposits made into any
special funds for self insurance, administrative, auditing
and other overhead expenses of the Agency.
(q) "payments for an ownership interest in a Joint
Project" - The payments received by the Agency from an
entity who has joined with the Agency in a Joint Project
whereby such entity acquires a greater ownership interest in
the Joint Project by the purchase from the Agency of a
portion of the Agency's ownership interest.
(r) "Revenue Fund" - The special furd created and
established under Section 5.02 of this resolution.
s (s) "system" - All properties owned or operated by or
on behalf of the Agency, and its interest in property used
or useful in the generation, transmission, distribution,
exchange, purchase or sale of electric power and energy, and
in the control, storing, distribution or sale of water,
including, but without limiting the generality of the foregoing,
dams, flood control facilities, reservoirs, canals, power
plants, transmission lines, Substations, transformers,
distribution lines, fuel supplies for use in generating
facilities proposed to be acquired or constructed by the
Agency, structures, lands, buildings, appurtenances and
facilities, and water rights, permits. easements, franchises
and leaseholds, and all improvements, replacements, renewals
and extensions of and additions to any of the foregoing at
any time made, including all transmission lines and distribution
lines and other facilities at any time owned by the Agency
or operated by the Agency in connection with the foregoing.
The ownership interest of the Agency in any Joint Projects
shall be considered a part of the system.
ARTICLE II
Bond Authorization and Specifications
SECTION 2.01: Authorization. In order to borrow the
sum of_T632MO for t e purpose of providing funds with
which to discharge certain costs and expenses of the Agency
in connection with the acquisition or construction of certain
jointly owned electric facilities, and to provide engineering,
planning and financing expenses, and acting pursuant co the
Constitution and lFws of the State of Texas, particu~.arly
the provisions of Article 1435a; R.C.S., 1925, as amended,
the Board of Directors has determined thst there shall be
issued and there is hereby ordered to be issued a series of
negotiable coupon bonds to be designated, "TEXAS MUNICIPAL
POWER AGENCY REVENUE BONDS, SERIES 1975 " dated September
15, 1975, in the principal sum of TEN MILLION SIX HUNDRED
TWENTY-FIVE THOUSAND DOLLARS ($10,625,000),
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SECTION 2.021: Data, Denomination, 11dLUlitie: and l:Aerest
Rates- e-"TE{PS 1tUCTPAL_T_b4R ACE9s✓1` FZEVENi11J-fsO1
=E1 S 1975," shall be dated September 15, 1575, shall he in
denomination of Five Thousand Dollars ($5,000) Each; shall
consist of two thousand one hundred twenty-five (2,125)
bond3 numbered consecutively from one (1) through two thousand
one hundred twenty-five (2,125); and shall become due and
payable serially on September 15 in each of the years in
accordance with the following schedule:
BOND NUMBERS
(All Inclusive) MATURITY AMOUNT
1 to 170 1977 $ 850,000
171 to 355 1978 925,000
356 to 555 1979 1,000,000
556 to 770 1980 1,075,000
771 to 1000 1981 1,150,000
1001 to 1250 1982 1,250,000
1251 to 1520 1983 1,350,000
1521 to 1810 1984 1,450,000
1811 to 2125 1985 1,575,000
SECTION 2.03: Interest. The bonds shall bear interest
from tie rdate Septem er 5, 1975) to September 15, 1977,
at the rate of SEVEN PER CENTUM ( 7 per
annum; from September 15, 137T,- to their respec[_fve maturity,
the bonds shall bear interest at the rate of EIGHT
PER CENTUH (__d_%) per annum, such interest to 'Ue evi ence
by proper coupons attached to each of said bonds and said
interest shall be payable on March 15, 1976, and semiannually
thereafter on September 15 and March 15 in ea^_h year.
SECTION 2.04: Pa in Oent. Both principal of and
interest on tfT -series o on s shall be payable whet, due,
in lawful money of the United States of America, without
exchange or collection charges to the owner or holder, at
Dallas Texas, (Paying Agent)
uuppon~presentat on an surren er o bonds or proper coupons.
SECTION 2.05: Prior Redemption. The Agency reserves
the r g3Wtto re eem a or any part of the outstanding bonds
at any time after all or any part of this series of bonds
become outstanding; provided, that at least thirty (30) days
prior to the date on which any of such bonds are to be
redeemed, a notice of such redempption, as authorized by the
Board of Directors, specifying the serial numbers and amount
of bonds to be redeemed shall be tiled with the paying agent
named in Section 2.04 Hereof. If by the date so fixed for
redemption the Agency shall have made available funds in
amounts sufficient to pay the bonds and accrued interest thereon
to the date of redemption pursuant to such notice and the
provisions hereof, the bends shall cease to bear interest on
and after the date so fixed for redemption and said bonds
shall not be regarded as being outstanding for any purpose
except for the purpose of receiving the funds so provided
for their payment.
SECTION 2.06: °orm. Tha fo.;., of t::c boa .s, f^cl:dire
the form or regTstra on certificate of the Comptroller of
Public Accounts of the State of Texas to be rimed thereon
and the forty of interest coupons to be attached thereto,
shall be respectively substantially as follows, to wit:
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NO. UNITED STATES OF tJIERICA $5,000
STATE OF TEXAS
TEXAS MUNICIPAL. POWER AGENCY
REVENUE BOND, SERIES 1975
The Texas Municipal Power Agency in the State of Texas
acknowledges itself indebted to and, FOR VALUE RECEIVED,
hereby promises to pay to the bearer hereof, as hereinafter
stated, on the t'lt`i'EEN'1'H DAY OF SEPTEMBER, the sum or
FIVE THOUSAND DOLLARS
($5,000) in lawful money of the United States of America,
with interest eheraon from the date hereof to maturity at
the rate of PER CENT al (
per annum, payable on March1 1976, and semiannua-ITy
thereafter on September 15 and March 15 in each year, and
interest falling due on or prior to maturity hereof is
payable only upon presentation and surrender of the interest
coupons hereto attached as they severally become due.
BOTH PRINCIPAL, of and interest on this bond shall be
payable at RERCANTILE NATIONAL BANK AT DALLAS, Dallas,
Texas without exchange or
co ect on Liarges to the owner orrh lder, and the said
Texas Municipal Power Agency is hereby held and firmly bound
to apply the pledged appropriated revenues to the prompt
payment of principal of and interest cn this bond at maturity
and to pay said principal and interest as they mature.
THIS BOND is one of a series of two thousand one hundred
twenty-five (2,125) serial bonds, ntinabered consecutively
from one (1) through two thousand one hundred twenty-five
(2,125), in denomination of five thousand dollars ($5,000)
each, aggregating TEN MILLION SIX HUNDRED TWENTY-FIVE
THOUSAND DOLLARS ($10,625,000) for the purpose of providing
funds with which to discharge certain costs and expenses of
the Agency in connection with the acquisLtion or construction
of certain jointly owned electric facilities, and to provide
engineering planning and financing expenses, all pursuant
to and consistent with the Constitution and laws of the
State of Texas relative thereto, including particularly the
provisions of Article 1435a, R.C.S., 1925, as amended, and a
resolution duly passed by the Board of Directors of said
Agency and duly recorded in the Minutes of said Board.
AS SPECIFIED in the resolution hereinabove mentioned,
the Agency reserves the right to redeem all or any part of.
the outstanding bonds of this series at any time all or any
part of such bonds become outstanding at the price of par
and accrued interest; PROVIDED, R04WEVER, that at least-
thirty (30) days prior to any interest payment date on which
any of such bonds are to be redeemed, a notice of such
redemption, as authorized by the Board of Directors, specifying
the serial numbers and amount of bonds to be redeemed, shall
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be filed with the paying agent herein named. If by the date
so fixed for redemption the Agency shall have made available
funds in amount sufficieit to -ay the bonds and accrued
interest thereon to the dLte of redemption pursuant to such
notice and the provisions hereof, the bonds shall cease to
bear interest on and after the date so fixed for redemption
and said bonds shall not be regarded as being outstanding
for any purpose except for the purpose of receiving the
funds so provided for their payment.
THE DATE of this bond in conformity with the resolution
above mentioned is September 15, 1975.
THE HOLDER hererof shall never have the right to demand
payment of this obligation out of any funds raised or to be
raised by taxation.
THIS BOciD and all Lunds of its series constitute special
revenue obligations of the Agency, each being payable as to
principal and interest solely from and equally secured by a
lien on and pledge of the Agency's system net revenues. As
provided in said resolution, no further bonds will be authorized
or issued under terms of the resolution or otherwise except
the Agency may issue refunding bonds equally secured by a
lien on and pledge of system net revenues on a parity with
the bonds of this series under the terms and conditions
provided in the aforemention(d resolution to which reference
is made for more complete details.
AND IT IS HEREBY CERTIFIED, RECITED, REPRESENTED AND
DECLARED that said Agency is a duly organized and legally
existing governmental agency and body 1o,,ltic and corporate,
organized under and by virtue of the Constituion and laws of
the State of Texas, to carry out the purposes of its creation;
that the issuance of this bond and the series of which it is
a part is duly authorized by law; that all acts, conditions
and things required to exist and be done precedent to and in
the issuance of this bond to render the same lawful and
valid have been properly done, have happened and have been
performed in regular and due time, form and manner as required
y the Constitution and laws of the State of Texas, and the
resolution hereinahove mentioned; that this series of revenue
bonds does not exceed any Constitutional or statutory limita-
tions; and that p•:ovision has been made for the payment of
the principal of andinterest on this bond and the series of
which it is a pdrt by an irrevocable pledge of the Agency's
system net revenues as aforestated.
IN TESTIMONY WHEREOF, the Board of Directors of the
Texas Municipal Power Agency, in accordance with the provisions
of Article 717j-1 R.C.S. of Texas, as amended, has caused
the seal of said Agency to be impressed or a facsimile
thereof to be printed hereon and this bond and its appurtenant
coupons to be executed in the name of and on behalf of the
Agency with the imprinted facsimile s4gnatures of its
President and Secretary, as of the 15th day of September,
' 1975.
TEXAS MUNICIPAL POWER AGENCY
By
rea ent
Board of Directors
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ATTEST:
ecretary
Board of Directors
(Form of Interest Coupon)
No.
On the fifteenth day of 19 unless
the bond hereinafter mentions s a ave been dT called
for prior redemption and payment of the redemption price
duly made or provided for, the Texas Municipal Power Agency,
a governmental agency and body politic any' corporate organized
and existing under the Constitution and laws of the State of
Texas, hereby promises to pay to the bearer hereof the
amount shown hereon out of funds specified in the bond to
which this coupon is attached (without right to demand
payment of this obligation out of funds raised or to be
raised by taxation), and in lawful money of the United
g
holder, without exchange
owner er or America,
the States
MERCANTILE NATIONAL SANK AT DALLAS,
Dallas, Texas sa- sum
e ng mont s merest ue t at ate on "TEXAS
MUNICIPAL-MY-AGENCY REVENUE BOND, SERIES 1975," dated
September 15, 1975. Bond No.
ecretary President
(Form of Comptroller's Certificate)
CERTIFICATE OF COMPTROLLER
OFFICE OF COMPTROLLER §
S REGISTER NO.
STATE OF TEXAS §
I HEREBY CERTIFY that there is on file and of record in
my office a certificate of the Attorney General of the State
of Texas approving this bond and the proceedings for the
issuance thereof and certifying that this bond and the pro-
ceedings for the issuance thereof have been examined by him
as required by law, and that he finds that this bond has
been issued in accordance with law and that it is a valid
and binding special obligation of Texas Municipal Power
Agency, payable from the revenues pledged to its payment by
and in the proceedings authorizing the same, and I do further
certify that this bond has this day been registered by me as
Comptroller.
WITNESS MY HAND AND SEAL OF OFFICE at Austin, Texas,
.fi omptro er o Pub is Accounts of
the State of Texas
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ARTICLE III
Execution, Approval, Registration - Bonds Negotiable -
Replacement of Bonds
SECTION 3.0;: Method of Execution. The corporate seal
of the gency may be impresse on eac of the bonds or, in
the alternative, a facsimile of such seal may be printed on
each of said bonds. In accordance with the provisions of
Article 717j-1, R.C.S., 1925, as amended, the bonds and
interest coupons appurtenant thereto may be executed by the
imprinted facsimile signatures of the President of the Board
of Directors of the Agency and its Secretary and execution
in such manner shall have the same effect as if such bonds
and coupons had been signed by the President and Secretary
in person by their manual signatures.
SECTION 3.02: A roval b Attorney General and Ra istration
b the - om-CCOler o u c Accounts. T e President o the
Board is hereby authorized to navecontrol and custody of
the bonds and all necessary records and proceedings pertaining
thereto pending their delivery to the purchasers thereof,
and the President, Vice President and other officers and
employees of the Agency are hereby authorized and instructed
to make such certifications, execute such instruments and
perform such acts as may be necessary to assure the proper
investigation, examination and approval thereof by the
Attorney General of the State of Texas, and their registration
by the State Comptroller of Public Accounts.
SECTION 3.03: Bonds Negotiable. The bonds constitute
negotiable instruments within e meaning of the Uniform
Commercial Code of the State of Texas. Each and every
successive holder of any such bonds, or of interest coupons
appertaining thereto, is conclusively presumed to forego and
renounce his equities in favor of subsequent holders for
value without notice and agree that such bond and said
interest coupons may be negotiated by delivery by any person
having possession however acquired.
SECTION 3.04: Replacement of Damaged, Destroyed, Lost
or Sto ern SonTs. The Agency may issue ones to be exchanged
or any theretofore lawfully issued and outstanding damaged
or mutilated bonds and as replacements for any theretofore
lawfully issued and outstanding destroyed, lost or stolen
bonds, all in accordance with and under conditions specified
or permitted by ArtlelP 715x, R.C.S. of Texas, relating to
the subject.
ARTICLE IV
Disposition of Bond Proceeds
The bonds shall be sold for cash and the proceeds
thereof deposited with the Agency depository. Transfers and
disbursements shall be made therefrom in the following
order:
(a) To the Bund Fund: the accrued interest received
upon the delivery of the bonds.
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(b) To the Bond Fund: such sum as when added to the
aforementioned accrued interest shall be sufficient to pay
interest which will become due on or before September 15,
1976.
(c) To the Bond Reserve Fund: the sum of $850,000.
(d) To the Construction Fund: the balance of such
proceeds.
ARTICLE V
Pledge - Creation and Administration of Funds
SECTION 5.01: Pledge. The bonds shall be and are
hereby ec area-co be payable solely from and equally secured
by an irrevocable lien on and pledge of the net revenues of
the Agency.
'SECTION 5.02: The Revenue Fund is hereby created and
estab s e w ti R_the depository. The gross income of the
Agency shall be deposited as received into the Revenue Fund.
Money on deposit in the Revenue Fund shall be used in the
following order of priority:
(1) For the payment of the operating and mainter.ance
expenses (as such term is herein defined) as the same shall
become due, and then
(2) For deposits into the Bond Fund (for the payment
of the principal of and interest on the bonds as tre same
become due), as required by Section 5.03, and then
(3) For deposits into the Reserve Fund (for the security
and payment of the bonds when there is a deficiercy of money
available for such purpose in the Bond Fund), as required by
Section 5.04, and then
(4) For any lawful purpose of the Agency.
Payments for an ownership interest in a Joint Project (which
are excluded from the definition of the term gross revenues)
shall be deposited as received in the Mandatory Redemption
Fund established by Section 5.06 hereof.
SECTION 5.03: Bond Fund. The Bond Fund is hereby
create an establis e w t MERCAh'TILE NAAT~IOnA C T
DALLAS, Dallas, Texas provi~ Mit such ac a s or
refuses to make investments in accordance with the provisions
of this resolution, the Board may designate another bank
(within the State of Texas) as custodian of said Fund.
From the moneys on hand in the Revenue Fund, the Agency
shall cause to be transferred to the Bond Fund an amount
sufficient to pay the princi al of and interest on bonds as
the same become due, and suc funds shall vc u-sCd fvr no
other purpose. All accrued interest received from the purchaser
of the bonds, together With an amount (out of bond proceeds)
F sufficient to pay the interest on the bonds (as the same
becomes uue uti ru,..:« 15 17,w, and September 15, 1976),
shall be deposited in the Bond Fund. Beginning on or before
October 10, 1976, and on or before the 10th day of each
ukonLh thereafter, there shall be deposited in said Fund a
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aura of money equal to not less than (I1 Uf[b-t~IC ll1u \.1/„12.
of the principal amount of the bond3 maturing on the next
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succeeding principal date, and (ii) one-sixth of the amount
of interest to become due on the next succeeding interest
payment- date, and such monthly deposits shall continue to be
made until such time as the Bond Fund and the Reserve Fund
contain a sum sufficient to pay the principal of and interest
on all bonds then outstanding to their final maturity. In
the event the amount on hand and available in the Reve;sue
Fund for transfer to the Bond Fund is insufficient to permit
the required deposit in full in accordance with the provisions
of this Section, then the amount of any deficiency shall be
transferred by the Agency to the Bond Fund from the Reserve
Fund.
SECTION 5.04: Reserve Fund. The Reserve Fund is
hereby created and estaoTis&e_J_ with the MERCANTILE NATIONAL BANK
AT DLAS. Dallas. Texas , provided t- a sued 5ank~
a sALor re uses to make investments in accordance with the
provisions of this resolution, the Board may designate
another bank (within the State of Texas) as custodian of
said Fund.
Upon the delivery of the bonds, the sum of $850,000 shall be
deposited in the Reserve Fund out of bond proceeds. On or
before the 10th day of October, 1976, and on or before the
10th day of each month thereafter, there shall be deposited
in the Reserve Fund, from money on hand in the Revenue Fund,
the sum of $23,585.00 and such monthly deposits shall continue
to be made until there is on hand in the Reserve Fund the
sum of $1,699,060. In the event money in the Reserve Fund
is utilized for the purpose for which the said Fund is
created and established (the payment of principal of and
interest on bonds when there is a deficiency in the Bond
Fund) the monthly deposits shall be resumed and continued
until the said sum of $1,699,060 has been accumulated therein.
In the event the money in the Reserve Fund is utilized for
the aforesaid purpose prior to the time the full amount of
the Reserve Fund is deposited therein, then the monthly
payments of $23,585 to replenish the Fund (as required by
the preceding sentence) shall be made in addition to the
monthly deposits required !~y the first sentence of this
paragraph.
SECTION 5.05: Limitations upon Deposits to the Bond
Fund a-n-d-tTFe Reserve "Ln Whenever the amount of moneys in
the Bond F un , together with the amount of moneys in the
Reserve Fund, shall be sufficient to pay the principal of
all bonds then outstanding upon their maturity dates and to
pay interest accrued and to accrue on such bonds to such
maturity dates, and shall be available for such purposes,
then and so long as such moneys shall continue to be available
and fully sufficient for such purposes, further transfer of
moneys from the Revenue Fund to the Bond Fund or Bond Reserve
Fund shall not be required. Whenever all bonds at the time
outstanding shall have been called for redemption and the
moneyys then in the Bond Fund, together with the moneys then
in tt►e Reserve Fund, shall be sufficient to pay the redemption
prigge of all such bonds (principal and accrued interest to
the date or dates specified for such redemption) and shall
be available for such purpose, then and so long as such
moneys shall continue to be available and fully sufficient
for such purpose, further transfers of moiieys to the Bond
Fund or to the Bond Reserve Fund shall not be required,
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If at any time the amount of cash and investment securities
in the Reserve Fund, valued at their purchase price, exceed
the amount then required to be accumulated therein ($1,699,060),
such excess may, in the Board's discretion, be transferred
either to the Revenue Fund or the Bond Fund, or used in the
purchase of the Agency's bonds on the open market at not to
exceed the par value therof, plus interest. Any bonds so
purchased shall be cancelled and retired.
Any amounts received as investment income of the Bond
Fund shall remain a part of such Fund and may be used to
:educe the next monthly deposit or deposits required to be
made to said Fund.
SECTION 5.06: Mandatory Redemption Fund. As provided
by SectFon-5.U2-zpayments for an ownership interest in a
Joint Project), and as provided in Section 5.07 (bond proceeds
in excess of 5% of the principal amount of the issue remaining
after the Joint Project is complete) moneys shall be deposited
in the Mandatory Redemption Fund. Additionally, money received
(if any) from a member city as a single payment upon the
withdrawal of such city [as contemplated by Section 4.07(b)(2)
of the agreement specified in Section 1.01(d)(i) hereof]
shall be deposited as received in the Mandatory Redemption
Fund,
Money in the Mandatory Redemption Fund shall he used
for the purpose of calling bonds for redemption on the first
interest payment date which occurs more than 45 days after
such funds are deposited in said fund, provided that nothing
herein shall be construed as prohibiting (i) the purchase of
bonds on the open market at a price of not to exceed par and
accrued interest or (ii) the redemption of bonds upon 30
days' notice (as pravidcd in Section 2.05).
it shall be the duty of the Board to provide for the appli-
cation of money in the Mandatory Redemption fund in accordance
with the provisions of this Section.
The paying agent shall be custodian of the Mandatory Re-
demption Fund.
SECTION 5.07: The Construction_ Fund. The Construction
Fund s ereby create an esta is e_dwith the
depository bank , prnvi e that site
an fails or refuses to make investments in accordance with
the provisions of this resolution, the Board may designate
another bank (within the State of Texas) as custodian of
said Fund.
' As provided in Section 4.01 above, all proceeds from
the sale of the Bonds not appropriated for purposes specified
in subparagraphs (a), (b) and (c) thereof shall be deposited
in said Construction Fund for use in paying Agency's costs
incident to the purpose of the financing. These funds may
be invested in eligible securities as directed by the Board
-i provided such investments shall mature on dates coinciding
as closely as practicable with dates when money may be
needed to pay acquisition and construction costs as estimated
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in schedules prepared by the Agency's Executive Director.
Earnings from such investments shall be retained in the
Construction Fund. When the Joint Project for which the
bonds are issued has been completed in accordance with
approved plans and when all amounts, including all proper
incidental expenses, shall have been paid, then any earnings
from such investments not expended in aid of construction
shall be deposited in the Bond Fund, provided that any
amount in excess of 5% of the principal amount of the issue
shall be deposited in the Mandatory Redemption Fund.
The Agency's Executive Director or its Treasurer shall,
from the Construction Fund, advance amounts needed to cover
costs of acquisition and construction of the Joint Project
in compliance and consistent with the provisions of the
agreements.
.SECTION 5.08: EliSible Securities. When used with
reference to amounts heI in the un s below identified,
those banking institutions designated as custodians of sdch
Funds shall, as directed by the Agency's Executive Director,
invest and reinvest such funds in securities hereby declared
eligible as follows:
(a) Bond Fund and Bond Reserve Fund provided for under
Section 5.03 and 5.04 hereof respectively - direct
obligations of the United States of America; obligations
which in the opinion of the Attorney General of the
United States are general obligations of the United
States and backed by its full faith and credit; obligations
guaranteed by the United States of America; evidences
of indebtedness of the Federal Land Banks, Fed--ral
Intermediate Credit Banks, Banks for Cooperatives,
Federal Home Loan Banks, Federal National Mortgage
Association; Participation Certificates in the Federal
Assets Financing Trust; bonds secured by the general
credit of t State of Texas; and Certificates of
Deposit of any bank or trust company which are fully
secured by obligations in which the Agency may invest
(under the provisions of this paragraph) to the extent
the Certificates of Deposit are not guaranteed by the
Federal Deposit Insurance Corporation.
(b) The Construction Fund provided for under Section
5.07 hereof - those securities listed in subparagraph
(a) above and in addition obligations issued or guaranteed
by any State of the United States or District of Columbia,
or any political subdivision of any such Stare or
District, provided such obligations are rated for
investment purposes at not less than A by Moody's
Investors Service, Inc. or by Standard & Poor's Corporation;
and repurchase agreements with solvent banking or other
financial institutions with respect to any of the obli-
gations or securities referred to in subparagraph (a)
above.
ARTICLE VI
No Additional Bonds
The Board covenants that no additional obligations
shall be issued by the Agency which pledge the net revenues,
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or any part thereof, during the time the bonds are outstanding,
provided the Agency shall retain the right to issue refunding
bonds to refund all or any part of its outstanding revenue
bonds as permitted by and in accordance with any lawful
method thereunto appertaining, it being provided, however,
that no refunding bonds shall be issued which (i) shall
enjoy a lien on system revenues superior to that possessed
by the Bonds or (ii) shall be made to mature or bear interest
in such manner or at such rates as will impair the security
or interfere with the timely payment of principal or interest
on bonds not refunded.
ARTICLE VII
Special Covenants
SECTION 7.01: Ca ital Additions - To Be Made Commercially
Orerat vie "T a Agency covenants that it will fait hfuull
carry out and perform all duties and responsibilities imposed
upon it under the terms of this resolution, and will otherwise
to the full extent of its lawful powers conduct its affairs
in a manner best calculated to advance the commencement and
completion of the Joint Project and all functionally relayed
parts once undertaken.
SECTION 7.02: Agencc To Punctually Discharge Obli ations
Of Se~ea7~nds. The Agency covenants an agrees it
w III duly an punctually pay or cause to be paid oat of
funds derived or to be derived from system revenues the
principal of the bond issue hereunder, and the interest
thereon, at the dates and places and in the manner mentioned
in such bonds and in the interest coupons thereto appertaining,
according to the true intent and meaning thereof, and that
it will faithfully do a:ad perform and at all times fully
observe any and all covenants, undertakings, stipulations
and provisions contained herein and in any band executed and
delivered hereunder.
SECTION 7.03: No Other Encumbrances 0 System Revenues.
Other EEa~or tFie payment of-t a Bonds, tfie: net revenues of
the system have not been pledged in a•:y manlier to the payment
of any debt or obligation of the Agency and otherwise the
system and its net revenues are free and clear of all encumbrances
whatsoever.
SECTION 7,04: Agency- A Governmental Agent. The
Agency represents that is a governmental aency and body
politic. and corporate, duly organized and existing under the
Constitution and laws of the State of Texas and that it is
duly authorized under the laws of the State of Texas to
construct, acquire, operate, maintain, repair, renew and
replace the system as herein mentioned and described and to
le.y and collect rates, tolls, rents, fees and other charges,
and to pledge its revenues and that all corporate action on
its part to that end has been duly and validly taken.
cf SECTION 7.05: Maintenance Of System - Engineer Inspection
„ And Rte, T~Agency covenants that the system an each
an every part thereof will be continuously operated by the
Agency (or on its behalf) in an efficient and economical
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wanner and will be kept in thorough repair and maintained in
a high state of operating efficiency and in such manner that
the interests of the people of the State of Texas and of the
bondholders ant of the Agency will be promoted; and the
Agency further covenants and agrees that it is duly authorized,
through its Board of Directors, to appoint such officers,
agents and employees, and to prescribe their duties and
terms of office, as may be proper and necessary to the
operation and maintenance of the system, in accordance with
its covenants hereunder, and to fix their compensation in an
amount sufficient to obtain the services of competent and
efficient persons in such positions; and that it will,
during the time any bonds are outstanding hereunder, select
and appoint and define the duties and fix the compensation
of all such officers, igents, and employees, particularly
such officers, agents and employees as are specifically
required to perform duties under this resolution. The
Agency agrees that it will cause its system and properties
to be inspected and its records relative to the operation
and maintenance thereof to be reviewed by an independent
engineer in each three-year period and to receive and consider
the report wh'.ch shall be furnished by such engineer and to
act upon his •ecommenaations, including those relating to
the amounts to be expended annually during the next ensuing
three (3) years for administration, operations and ordinary
maintenance.
SECTION 7.06: Maintenance of Rates and Charges. The
Agency expressly covenants to esta s an co ect rates
and other charges sufficient to produce revenues adequate
(a) to pay the operating and maintenance expenses of the
Agency, and (b) to pay the interest on and principal of all
bonds issued under the Act when and as the same shall become
due end ~ayable and (c) to ray the principal and interest on
any legs debt created by the Agency, and (d) to pay all
Bond Fund and Reserve fund (eitfter or both) payments
agreed to be made in respect of any such bonds, and payable
out of such revenues, when and as the same shall become due
and payable, and (e) to fulfill tha terms of any agreements
made with the holders of such bonds or with any person in
their behalf. Accordingly the Agency covenants that prig
to the adoption of its annual budget in each fiscal year it
will establish or maintain such schedules of rents, tolls,
rates and other charges for electric power and energy and
for any and all other commodities, services and facilities
to be furnished or supplied by it, on the basis of all
available information and experience and with due allowance
for contingencies, to produce in such succeeding fiscal year
revenues not only sufficient to pay all system operating and
maintenance expenses for that year but also sufficient to
provide all debt service requirements due in that year,
taking into consideration at that time, funds on hand in the
Rrvenue Fund available for and budgeted for the purpose of
servicing revenue bond debt requirements in the succeeding
fiscal year.
SECTtUN 7.u7: S stem insurance. The Agency covenants
that so long as any of the oon`ds authorized herein shall
remain outstanding or be unpaid, it will at all times insure
with responsible insurers such of its plants, structures,
buildings, stattons, substations, machinery, equipment,
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apparatus, dams and canals (it may hereafter acquire) as are
usually insured by corporations operating like properties,
or will create and maintain special funds for self-insurance
in such amounts and against such risks, or both, as may be
necessary to protect the interest of the bondholders. The
Agency further covenants and agrees that in the event of any
loss or damage it will repair or reconstruct the damaged
portion of the property and will apply the proceeds of the
insurance policies covering such loss solely for that purpose,
and that it will also apply moneys held in any such special
self-insurance fund for that purpose, including the payment
of all costs and expenses in connection therewith. Such work
of repair and reconstruction shall be done promptly after
such loss or damage shall occur, and shall continue until
such repair or reconstruction is completed. Any balance
remaining from the proceeds of insurance policies after all
such repairs and reconstruction have been completed and paid for,
shall be deposited in the Reverlie Fund. In the event an
independent engineer shall file with the general manager his
certificate certifying that the damaged or destroyed property
is not needed for operations in connection with the system
and therefore should not be repaired or reconstructed, the
proceeds of any insurance policies covering such loss or
damage shall be paid to the Agency for deposit in the Revenue
Fund.
The project manager shall make arrangements for insurance
coverage during the periods during which any construction
work and station work or any phase thereof shall be in
progress in accordance with the procedures for the F*ocuremen*-
of such insurance specified in the agreements.
SECTION 7.08: Books and Records. The Agency covenants
that proaer books of recan account will be kept in
which full, true and correct entries will be made of all
income, expenses and transactions of and in relation to the
egstem, and each and every part thereof, in accordance with
the agreements. On or before ninety (90) days after the
close of each fiscal year of the Agency, beginning with the
fiscal year ending in 1976, a statement showing the gross
income, the operating and maintenance expenses and the net
inco,;e of the Agency for the fiscal year then last expired,
and a balance sheet of the Agency as of the end of such last
fiscal year, all certified by an independent accountant,
will be supplied the underwriters of the Bonds, The Agency
further covenants and agrees that the s,fstem, and each and
every part thereof, and all books, records, accounts, documents
and vouchers relating to the construction, operation, maintenance,
repair, improvement and extension thereof, will at all times
be open to inspection of the bondholders and their representatives.
SECTION 7.09: Resolution not Subject to Substantive Shan es.
No changes or amendments shall alter the prow s ono ereo
ur the provisions of the agreements relating to th(e position
the Bonds are to enjo in the Agency's debt structure or the
amounts to be paid, the times of payment or sources of
payment. The bondholders shall be entitled to rely upon such
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provisions as protection of their rights and as assurances
of full payment and discharge of all obligations assumed by
the Agency under the terms of this resolution.
Nothing herein shall prohibit the amendment or modifi-
cation of
(i) this resolution, or
(ii) the agreements
if the effect of such amendment or modification relates to
the administration of the affairs of the Agency (other than
those enumerated) or if the same modifies or deletes the
negative covenants as contained in Sections 8.8, 8.4 or 8.10
of the agreement by and between the Agency, Brazos Electric
Cooperative, Inc. and the Texas Power Pool, Inc., and in
Section 1.03 of the agreement by and between the Agency and
its member cities.
SECTION 7.10: Expenses Budgeted. The Agency shall not
incur operating and maintenance expenses in any fiscal year
in excess of the amount provided therefor in the Agency's
budget for that fiscal year, as finally adopted.
SECTION 7.11: No Arbitrasee. The Agency certifiias that
based oacts, estimate`s aacircumstances expected t.o
exist on the date of the issue of the Bonds it is not reasonable
to anticipate that the prcceeds thereof will be used in a
manner which would cause them to be "arbitrage bonds" within
the meaning of Section 103(d) of the Internal Revenue Code
of 1954, as amended, or regulations thereunder applicable
thereto, and the officers of the Agen,:y charged with responsibilities
in the issuance of bonds are authorized and directed to
make, execute and deliver certifications as to facts, estimates
and circumstances in existence as of the date of the issue
of said Bends and stating whether there are any facts,
estimates or circumstances which would materially change the
Agency's present expectations. The covenants herein made
and the certifications herein authorized are for the benefit
of the holders from time to time of said Bonds and the
coupons appertaining thereto and may be relied upon by said
holders and by bond counsel for the Agency.
ARTICLE VIII
Ancillary Provisions
SECTION 8.01: Resolution Constitutes Contract. The
rovisrons of is re`soTut onsEa const tutu a contract as
between the Agency and the owners and holders from time to
time of the Bonds and shall remain irrepealable until all of
said bonds have been paid as to both principal and intcrest,
or shall have been refunded or until provision for payment
:•w shall be made by depositing in trust with the paying agent
all money required to pay all outstanding principal plus
interest to maturity or to the call date in the event all
such bonds have been called for redemption prior to maturity.
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SECTION 8.02: Default. In the event of default in the
payment of principal -oT or interest on the debt of the
Agency, any court of competent jurisdiction upon petition of
the holders of 25% of the principal amount of the then
outstanding bonds of the Agency shall appoint a receiver
with authority to collect and receive all resources pledged
to the debt of the Agency, enforce all rights arising from
default (if any) by any party contracting with the Agency,
including the failure to make payment under the agreements.
Such receiver may employ and discharge agents and employees
of the Agency, take charge of the pledged funds on hand and
manage the proprietary affairs of the Agency without consent
or hindrance by the Agency. The court may further vest the
receiver with such powers and duties as the court may find
necessary for the protection of the holders of the bonds.
SECTION 8.03: CUSIP Numbers. CUSIP numbers are to be
printed on theeondssere nauEForized. It is expressly
provided, however, that the presence or absence of CUSIP
numbers on the bonds shall be of no significance or effect
as regards the legality thereof, and neither the Agency nor
attorneys approving said bonds as to legality are to be held
responsible for CUSIP numbers incorrectly printed on the
bonds.
SECTION 8.04: Printed Legal Opinion on Bonds. The
urchasecs obligation to accept a very o t e bonds
herein authorized is subject to their being furnished a
final opinion of Messrs. Dumas, Huguenin, Boothman and
Morrow, Attorneys, Dallas, Texas, approving such bonds as to
their validity, said opinion to be dated and delivered as of
the date of delivery and payment for such bonds. Printing
of a true and correct copy of said opinion on the reverse
side of each of said bonds with appropriate certificate
pertaining thereto executed by facsimile signature of the
Secretary of the Agency is hereby approved and authorized.
SECTION 8.05: Confirmation of Sale. The Sala of the
` bonds herein authorized to MERCANTILI"MTIONAL BANK AT
DALLAS, Dallas, Texas, at the price of 99.25% of par value
plus accrued interest is hereby confirmed. Delivery of said
bonds shall be male to said purchaser as soon as may be
after the auoption of this resolution upon payment therefor
in accordance with the terms of sale.
PASSED AND ADOPTED, this the day of
1915.
~;s ent, oar o rectors
Texas Municipal Power Agency
ATTEST:
rectors
f Di
ecretary, ar o
Texas Municipal Power Agency
(Agency Seal)
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WtLPOPD W. NAMAN NAMAN, HOWELL, SMITH S CHASE
CULLLN (Mir"
MILTON N."OW(LL ATTORNEYS AT LAW MILTON L. MGWLLL
J. POO.I CT LC L
LOUIS S. MULOPOW 081•'966#
AL L LAN G[ II 1. 110 TEXAS CENYER
AIELPT W'TC Ni■
PAUL N- "ULE.PO P.O. SOX 1470
PCL WNITAA 1
0V L. IEAPRE7 GEORGE CHASE
11
wer o. LnADr WAco,TEXAS 76703 Or CO 1196
WLLLLT J. ILLR
CNAIILE( A. ■.AIIOw
LAART 0. LC"eNAN
LEO. DAVIs
JEL 111T P. CAMPICLL 117 7NHii
J. DANIEL PICITi
GEORGE LEE FLINT, JP.
cut November 2, 1976
tSTE°
Mr. Paul C. Isham
City Attorney
City of Denton
Municipal Building
Denton, Texas 76201
Re: Texas Municipal Power 1,gency
Dear ilr. Isham.
Because of the reduced roll of Brazos Electric Power Cooperative
in the various joint projects, as set forth in the enclosed copy of
a memorandum of agreement between Brazos and Texas municipal Power
Agency, it has been determined that the interest of the Cities should
be transferred directly to Texas Municipal Power Agency, rather than
to Texas Power Pool, Inc., as agent, as was originally contemplated.
Accordingly, the earlier ordinances will need to be repealed,
new ordinances enacted, and new deeds and assignments executed,
transferring title directly to Texas Municipal Power Agency.
We are enclosing the following:
1. Draft of a proposed ordinance which repeals the earlier
ordinance, and authorizes the transfer of assets directly to Texas
Municipal Power Agency.
2. Revised deed covering the oil terminal.
3. Revised assignment covering the other interests of the
Cities in the lignite fuel programs.
The Board of Directors of Texas Municipal Power Agency will be
meeting on November 18th, and we would like to have a certified
copy of the ordinance, and the executed deed and assignment returned
to us prior to that date.
NAMAN, HOWELL, 5141TH S CHASE
Mr. Paul C. laham -2- November 2, 1976
There ar,= a number of matters which must be attended to, bit
.j-; things no-d stand it is unclear who should act with respect to
th: variots matters since some of the title stands in Brazos as
trustee, some in TPPI, and some in the Cities. The enclosed
instruments should clear everything up and put Texas Municipal Power
Acency in a position to operate on behalf of the Cities as originally
intended.
The earlier deed and assignr»crts have not been recorded, and
will be discarded.
Please call if you have arty questions.
Yours very truly,
NAMAN, LL, SMITH b CHASE
BY
Alexander M. Haw
AMH:jc
Enclosures
C
AN ORDINANCE BY THE CITY COUNCIL OF THE
CITY OF RELATING TO THE
TRANSFER AND SALE OF CERTAIN PROPERTIES
AND PROPERTY RIGHTS BELONGING TO THIS
CITY TO THE TEXAS MUNICIPAL POWER AGENCY;
REPEALING AN ORDIt::~NCE OF ;
DECLARING AN EMERGENCY; AND RESOLVING OTHER
MATTERS IN CONNECTION THEREWITH AND PROVIDING
AN EFFECTIVE DATE.
WHEREAS, the TEXAS MUNICIPAL POWER AGENCY ("TMPA") has been
heretofore created and ei~cablished as a municipal corporation, a
political subdivision of the State of Texas, and a body politic and
corporate, by the Cities of Bryan, Denton, Garland and Greenville,
Texas ("The cities"), and
WHEREAS, Brazos Electric Power Cooperative, Inc., ("Brazos")
.and the Cities are the joint owners of that certain tract of land
in Hunt County, Texas, that is described in a deed in which they
are the grantees dated May 23, 1973, r:corded in Volume 729, Page
749 of the Deed Records of Hunt County, Texas, together with the
furl oil and truck terminal which is located thereon ("oil terminal"),
and
WHEREAS, pursuant to a common lignite fuel development plan
Brazos and the Cities, by and through lignite leases, options to
lease, exploration contracts :ind other instruments executed pursuant
to or in contemplation of a Lignite Joint Ownership Agreement dated
April 28, 1975, have conducted exploration for lignite and have
acquired jointly -ertain interests in real property in various
counties in Texas, and the lignite located in and under such real
AN ORDINANCE BY THE CITY COUNCIL OF THE
CITY OF RELATING TO THE
TRANSFER AND SALE OF CERTAIN PROPERTIES
AND PROPERTY RIGHTS BELONGING TO THIS
CITY TO THE TEXAS MUNICIPAL POWER AGENCY;
REPEALING AN ORDINANCE OF
DECLARING AN EMERGENCY; AND RESOLVING OTHER
MATTERS IN CONNECTION THEREWITH AND PROVIDING
AN EFFECTIVE DATE.
WHEREAS, the TEXAS MUNICIPAL POWER AGENCY ("TMPA") has been
heretofore created and established as a municipal corporation, a
political subdivision of the State of Texas, and a body politic an'l
corporate, by the Cities of Bryan, Denton, Garland and Greenville,
Texan ("The Cities"), and
WHEREAS, Brazos Electric Power Cooperative, Inc., ("Brazos")
and the Cities are the joint owners of that certain tract of land
in Hunt County, Texas, that is described in a deed in which they
are the grantees dated May 23, 1973, recorded in Volume 729, Page
749 of the Deed Records of Hunt County, Texas, together with the
fuel oil e.id truck terminal which is located thereon ("oil terminal"),
and
WHEREAS, pursuant to a common lignite fuel development plan
Brazos and the Cities, by and through lignite leases, options to
lease, exploration contracts and other instruments executed pursuant
to or in contemplation of a Lignite Joint Ownership Agreement dated
April 260 1975, have conducted exploration for lignite and have
acquired jointly certain interests in rcal property in various
counties in Texas, and the lignite located in and under such real
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property, in the name of Brazos Electric Power Cooperative as
Trustee for the Texas Municipal Power Pool, which agreement provides
that Brazos will not transfer or otherwise dispose of the interest
of a participant to such agreement without the written consent of
the participant, and
WHEREAS, TMPA, Brazos and Texas Power Pool, Inc. ("TPPI"),
entered into an agreement dated October 30, 1975, entitled "Pre-
liminary Participation Agreement" pursuant to which additional
exploration has taken place and interests have been acquired in
lignite through leases, options to lease or other instruments, with
title to such interests being held by TPPI as agent for TMPA and
Brazos, and TMPA and Brazos, and TPPI and Brazos have entered into
other agreements for the development of fuel resources, planning
electrical generation facilities, and performing certain services in
furtherance of the Lignite Joint Ownership Agreement and the Pre-
liminary Participation Agreement, and
WHEREAS, pursuant to the foregoing agreements and other joint
undertakings, the cities have acquired interests in real property,
(the "lignite properties") and have acquired the results of testing
and exploration for lignite*(the "exploration results"), and have
developed plans for the development of fuel resources and generation
facilities, (the "fuel development programs") and
WHEREAS, by Memorandum of Agreement dated September 16, 1976,
between TMPA and Brazos, Brazos has agreed to convey to TMPA the
interests of Brazos in the Oil Terminal, the lignite properties, the
exploration results, and the fuel development programs in exchange
for the reimbursement to Brazos for capital contributions made by
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Brazos to the various joint projects, and the assumption by VLPA of
all obligations of Brazos associated therewith, and
WHEREAS, TMPA t.as expressed a desire and willingness to acquire
the interest of the Cities and Brazos in the Oil Terminal, the
lignite properties, the exploration results, and the fuel development
programs in exchange for the reimbursement to all parties by TMPA
for the capital contributions made by each party to such projects, C
and the assumption of all obligations associated therewith, and all
of such parties have indicated an agreement that TKPA may better
administer, handle, and own such properties, and that lo:gal title
thereto should be vested in TMPA;
THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
SECTION 1. It is hereby found that the interest of the City in
the properties described in the preamble hereof:
(a) Could best be utilized and administered by Texas Municipal
Power Agency, that such use and administration by Texas
Municipal Power Agency would be a higher public use and a
paramo4sit public purpose since the same could by accomplished
at a savings to the City, but without adversely affecting
the rights of the City under its agreements with Texas
j Aunicipal Power Agency; and
(b) Are to be transferred by the voluntary action of this
City, rather than requiring Texas Municipal Power Agency
to exercise the power of eminent domain, and
(c) Are to be purchased by Texas Municipal Power Agency by the
payment to this City of all capital contributions made by
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this City to such joint projects, as heretofore agreed
upon, and the assumption of any obligations of this City
associated therewith, which the City Council finds will
represent replacement by property of equal value, and
(d) Are :iot to be used by this city for the purpose of pro-
viding, fuel. for the electric generating facilities of the
City (insofar as the lignite is concerned) since this City
has determined that lignite fired generation facilities
are not to be constructed by this City but may best be
constructed by Texas Municipal Power Agency for the
benefit of or use by all of the Cities mentioned in the
preamble hereof.
SECTION 2. At such time as conveyances, assignments on other
instruments of transfer have been prepared and approved by the City
Attorney, the Mayor is authorized to execute such instruments of
conveyance, assignment or transfer as may be necessary to convey,
assign and transfer to Texas Municipal Power'Agency the following:
(a) All right, title and interest of this City in the fuel oil
and truck terminal,
(b) The und'_vided interest of this City in the lignite prop-
erties whether through options for lignite leases or for
purchase of the fee title, lignite leases or purchases of
the fee title or other items, including all of such
interests in real property that have been acquired in the
name of Brazos Electric Power Cocperative, Inc., or Texas
Power Pool, Inc., as trustees or age,I.ts for this City,
I;
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{c) The undivided interest of this City in the Bryan lignite
fuel development program and the other fuel development
programs and in the exploration results involving, among
others, Van Zandt, Marion, Madison, Brazos, Grimes,
Burleson, Fayette, Wood, Hopkins and Franklin Counties,
Tex.is, including all logs, cores, surveys, tests, reports
and other information developed pursuant thereto, and
all claims, ii:terests, rights and causes of actior connecter
therewith.
SECTION 3. Brazos Electric Power Coopertive, Inc., and Texas
Power Pool, Inc., are hereby authorized, to the extent necessary, to
execute, on behalf of this City, conveyances, assignments or other
instruments of tFansfer to Texas Municipal Power Agency conveying,
assigning and transferring any =nterests they may hold as Trustee or
Agent for this City in any property or property rights described in
Section 2, above.
SFCTION 4. The conveyances, assignments and transfers to be
executed by the mayor pursuant to section 2, abova, shall be de-
livered to Texas Municipal Power Agency when payment is made to this
City of equal value, but pending such payment and delivery Texas
Municipal Power Agency, as ?gent for this City, is hereby iiuthorized
to use, manage and administer such property and property rights on
behalf of this City without further authorization than this oruinai,ce.
SECTION 5. Ordinance Number adopted the
day of It 14_1 is hereby repealed.
SECTION 6. All the recital+ and preamble hereinibove stated
are found.to be true and correct.
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SECTION 7. It is officially found and determined that this
meeting of the City Council is open to the public as required by law
and that public notice of the time, place and purpose of the meeting
was given as required by law. I
SECTION 8. The public importance of this measure and the fact
.that it is to the best interest of the City to accomplish the
transfers herein contemplated at the earliest possible date con-
stitutes and creates an c-urgency and an urgent public necessity,
requiring that any rule.providing for ordinances to be read more
than one time or at more than one meeting of the City Council be
suspended, and requiring that this ordinance be passed and take
effect as an emergency measure, and any such rules or provisions are
hereby suspended.
APPROVED and ADOPTED this day of , 1976.
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LIGNITE JOINT OWNERSHIP AGREEMENT
WHEREAS, the City of Bryan, Texas ("Bryan"), the City of Denton,
Texas ("Denton"), the City of Garland, Texas ("Garland"), the City of
Greenville, Texas ("Greenville") and Brazos Electric Power Coopera-
tive, Inc. ("Brazos") are the members of the Texas Municipal Power
Pool which was created by an Interchange Agreement dated September 23,
1963, as amended, and
WHEREAS, Bryan, Denton, Garland and Greenville are home rule
cities under the Constitution and laws of the State of Texas and
Brazos is a non-profit corporation organized as an electric coopera-
tive under the laws of the State of Texas, and
WHEREAS, Bryan, Denton, Garland, Greenville and Brazos ("Par-
ticipants") have their own electric generating, transmission and
distribution facilities at this time, but they are considering con-
structing and owning additional generating facilities jointly, and
WHEREAS, due to the shortage of natural gas and oil, fuel for
electric generating plants is difficult to find and is becoming more
expensive to acquire, and
WHEREAS, Participants balieve that they have located approxi-
mately 20,000 acres of lignite deposits ("Property"), which could be
used to fuel one or more electric generating plants, and
WHEREAS, Participants realize that their planning is not complete,
but they are fearful that any delay in leasing, or acquiring options
'to lease, the aforementioned Property will result in others leasing
the Property, and
WHEREAS, it appears that Participants have the requisite authority
to act jointly under the provisions of Article 1435a, V.A.T.C.S., in
planning, financing and acquiring electric generating facilities and
to this end have the authority to procure a fuel supply for generating
units to be constructed:
NOW, THEREFORE, Participants mutually agree as follows:
I. DESCRIPTION OF PROJECT:
1.1 The Pool Committee shall take all action that is neces-
sary to determine the exact location and quality of the lignite de-
posits in question j"Lignite").
1.2 The Participants, by and through options to lease and
leases, containing terms and conditions and in form satisfactory to
r ,
the Pool Committee, shall acquire the right to mine, remove and use
this Lignite, and, subject to adjustment as provided herein, shall own
the options to lease, the leases and their right, title and interest
in the Lignite as tenants in common, as follows:
(a) Bryan shall own and undivided 15.318 interest
therein;
(b) Denton shall own an undivided 11.908 interest
therein;
(c) Garland shall own an undivided 26.438 interest
therein;
(d) Greenville shall own an undivided 5.908 interest
therein; and
(e) Brazos shall own an undivided 40.468 interest
therein.
The Pool Committee shall take all action that is necessary to accom-
plish the purposes and intent of this Subsection 1.2 of this agreement.
1.3 As a matter of convenience to the Participants, any
options to lease and leases will be taken in the name of Brazos as
Trustee for the Texas Municipal Power Pool. Brazos agrees that it
will be holding record title for the benefit of the Participants in
the interests hereinabove provided, that it will not transfer or other-
wise dispose of the undivided interest of any Participant without
first securing the written consent of the Participant and that, upon
the written request of a Participant, it will transfer record title
to a Participant's undivided interest to the Participant.
1.4 It is hereby found and determined that the purchase of
land or interest therein as authorized to be done and performed here-
under is an emergency measure in the light of the need for fuel for
generating facilities; that the personal or professional services to
be rendered udder this agreement by test drilling and analysis of lig-
nite in order to determine the quantity and quality of the lignite to
be acquired by leases should proceed as quickly as possible; and that
all expenditures to be made by the Participants shall be paid from
current funds or bond funds of a Participant as a capital expenditure.
1.5 Considering the nature of the duties to be performed here-
under, initially the total amount to be expended unde- the provisions
hereof shall not exceed the sum of $275,000, this being composed of the
$125,000 approved by the Pool Committee on December 19, 1974, and the
$150,000 approved by the Pool Committee on March 27, 1975, but such
amount may be increased by unanimous approval of all of the Participants.
Provided, however, if one or more Participants disapprove of a pro-
-2-
posed increase, the remaining Participant or Participants may elect
to approve and pay the entire increase, such increase to be allocated
among the electing Participants in the ratio that the percentage own-
ership of each, as reflected in Subsection 1.2, bears to the total
aggregate percentages of all electing Participants. When the total
project costs have been determined, the percentage interests of the
Participants shall be adjusted in the manner specified in the last
sentence in Subsection 3.2. The original budget is attached hereto
and is hereby adopted and approved by the Participants. Any requests
of the Pool Committee for increases shall be supported by an amended
budget.- The Pool Committee may amend the original or amended budget
so long as such amendment does not increase the total amount of the
budget approved by the Participants. All expenditures shall be made
pursuant to the original budget or amended budget.
1.6 Subject to any limitations provided by this agreement or
general law, and in order to accomplish the purposes and intent of this
agreement, the Pool Committee may enter consulting and other agreements
for, on behalf of and in the name of the Participants and may designate,
from time to time, a project manager or successor project manager
("Project Manager") to act for and on behalf of the Pool Committee in
accomplishing the purposes and intent of this agreement. In order to
take action pursuant to this agreement, the Pool Committee shall follow
the procedure specified in the aforementioned Interchange Agreement
creating the Pool Committee.
II. COSTS OR PROJECT:
2.1 The project costs shall be shared by the Participants
in proportion to their ownership interests in the Lignite.
2.2 Each Participant shall pay its share of the project
costs in accordance with requests for funds submitted by the Pool
Committee. The Pool Committee shall prepare monthly project cost es-
timates and submit the same to the Participants at least forty-five
days prior to the beginning of the calendar month in question and the
Participants shall pay their portion of the project costs for such
calendar month at least thirty days prior to the beginning of such
calendar month. Such payments shall be made in such manner as desig-
nated by the Pool Committee. In the event delays occur which result
in the estimated expenditures not being made within the calendar
month in question, then the monthly estimates for subsequent months
shall be reduced aecordin4ly. Following completion of the project,
the fool Committee shall compute the total project costs and each
Participant shall promptly settle any balance that it owes. If at
any time it is determined that a Participant has made advances which
are greater or less than its share of the project costs, the differ-
ence shall be paid, refunded or credited promptly.
2.3 The Pool Committee shall maintain records reflecting
the payments by the Participants and the project costs paid by the
Pool Committee.
-3-
III. DEFAULTS:
3.1 For purposes of this Section III, the word "default"
shall mean the failure of any Participant to make any payment in the
time and manner provided by this agreement.
3.2 Each time a Participant defaults, the Pool Committee
shall give the non-defaulting Participants notice of the default. One
or more of the non-defaulting Participants, at any time prior to the
beginning of the calendar month in which the funds in question are to
be expended by the Pool Committee, may elect to make the payment
necessary to cover the default in question, the payment to be allo-
cated among the electing non-defaulting Participants in the ratio that
the percentage ownership of each as reflected in Subsection 1.2 bears
to the total aggregate percentages of all electing non-defaulting
Participants. When the total project costs have been determined, the
percentage interest of each Participant as reflected in Subsection 1.2
shall be reduced or increased, as the case may be, to the proportionate
part of the total project costs paid by it.
3.3 If, in the case of any default, none of the Participants
make the election called for in Subsection 3.2 of this agreement and
the defaulting Participant has not cured the default by the beginning
of the calendar month in which the funds in question are to be expended
by the Pool Committee, then' the project shall immediately be discon-
tinued and the same shall be liquidated for the benefit of all the
Participants as may best serve the interests of the non-defaulting
Participants.
3.4 Any Participant may dispute a request for funds by the
Pool Committee, provided that such Participant shall pay the disputed
payment under protest. The protest shall be in writing, shall ac-
company the disputed payment and shall specify the reasons upon which
the protest is based. Copies of such protest shall be mailed by such
Participant to all other Participants. Payments not made under pro-
test shall be deemed to be correct, except to the extent that audits
may reveal over or under payments by Participants, necessitating
adjustments. In the event it is determined that a Participant is
entitled to a refund of all or any portion of a disputed payment or
payments then the appropriate adjustments, refunds and payments shall
be made in accordance with such determination.
IV. TAXES:
In accordance with Subsection (3) of Section 4 of Article 1435a,
V.A.T.C.S., each Participant which is a private entity agrees to render
for ad valorem taxation its undivided fractional interest in the prop-
erty which, pursuant to this agreement, the Participants own jointly
and to pay all tams and assessments for which it is responsible pur-
suant to the terms of said statute.
-4-
V. WAIVER OF RIGHT TO PARTITION:
Each Participant hereto agrees to waiva any rights which it
may have to partition any component of the Lignite, whether by parti-
tion in kind or by sale and division of the proceeds, and further
agrees that it will not resort to any action in law or in equity to
partition such component, and it waives the benefits of all laws that
may now or hereafter authorize such partition for a term (i) i ch
shall be coterminous with this agreement, or (ii) which shall be for
such lesser period as may be required under applicable law.
VI. MORTGAGE AND TRANSFER OF INTERESTS:
6.1 Each Participant shall have the right at any time and
from time to time to mortgage, pledge, create or provide for a securi-
ty interest in or convey in trust all or a part of its ownership share
in the Lignite, together with an equal interest in this agreement, to
a trustee or trustees under deeds of trust, mortgages or indentures,
or to secured parties under a security agreement, as security for its
present or future bonds or other obligations or securities, and to any
successors or assigns thereof, without need for the prior written
consent of any other Participant, and without such mortgagee, trustee
or secured party assuming or becoming in any respect obligated to
perform any of the obligations of the Participant arising prior to
such time as such mortgagee, trustee or secured party obtains pos-
session of or assumes the right to exercise such Participant's rights
in respect of such ownership share, or after such possession or assump-
tion ceases.
6.2 Any mortgagee, trustee or secured party under present
or future deeds of trust, mortgages, indentures or security agreements
of any of the Participants and any successor or assign thereof, and
any receiver, referee or trustee in bankruptcy or reorganization of
any of the Participants, and any successor by action of law or other-
wise, and any purchaser, transferee or assignee of any thereof may,
without need for the prior written consent of the other Participants,
succeed to and acquire all of the rights, titles and interests of such
Participant in the Lignite and in this agreement, and may take over
possession of or foreclose upon said property, rights, titles and
interests of such Participant.
6.3 Each Participant shall have the right to transfer or
assign all or a part of its ownership in the Lignite, together with a
proportionate part of its rights under this agreement, to any of the
following without the need for prior written consent of any other
Participant:
(a) To any entity acquiring all of substantially
all of the electric utility properties and business of
such Participant; or
-5-
(b) To any entity merged or consolidated with
such Participant; or
(c) To any entity which is wholly-owned by such
Participant.
6.4 Except as otherwise provided in Subsections 6.1 and 6.2
hereof, any successor to the rightz, titles and interests of a Partici-
pant in the Lignite shall assume and agree in writing to fully perform
and discharge all of the obligations hereunder of such Participant, and
such successor shall notify each of the other Participants in writing
of such transfer, assignment or merger, and shall furnish to each Par-
ticipant evidence of such transfer, assignment or merger.
6.5 No Participant assigning or transferring an interest
under this Section VI or Section VII shall be relieved of any of its
obligations under this agreement and shall remain liable and obligated
for the performance of all of the terms and conditions of this agree-
ment, unless otherwise agreed by all of the remaining Participants.
VII. RIGHT OF FIRST REFUSAL:
7.1 Except as provided in Section VI hereof, should any
Participant, prior to the expiration of the period described in Sub-
section 7.10 hereof, desire to transfer its ownership in the Lignite,
or any part thereof, to any person, entity or another Participant,
ready, able and willing to acquire same, the Participant desiring to
make such transfer shall obtain a written offer from the prospective
transferee, setting forth the consideration and other terms of the
offer, and each of the other Participants shall have the right of
first refusal to acquire such interest on the basis of the following
consideration:
(a) If the offer is in cash, whether payable
in one payment or in installments, the amount of
the bona fide written offer from the prospective
transferee, payable as specified in the offer; or
(b) If the offer is not in cash but is in
securities having a readily ascertainable market
value, the fair market value of the securities
offered by the prospective transferee; or
(c) If the offer is neither in cash nor in
securities having a readily ascertainable market
value, the fair market value of the ownership in-
terest to be transferred.
7.2 At least oze hundred twenty (120) days prior to the
date on which the intended transfer is to be consummated, the Par-
-6-
ticipant desiring to transfer shall serve written notice of its in-
tention to do so upon all of the Participants. Such notice shall
contain the proposed date of transfer and the terms and conditions of
the transfer.
7.3 Each Participant shall have the option to acquire all
or Eny part of the interest to be transferred and shall exercise said
option by serving written notice of its intention upon the Participant
desiring to transfer and on the remaining Participants within sixty
(60) days after service of the written notice of intention to transfer
given pursuant to Section 7.2 hereof. Failure of a Participant to
exercise said option as provided herein within the time period speci-
fied shall be conclusively deemed to be an election not to exercise
said option.
7.4 If two or more of the Participants desire to acquire
parts aggregating more than all of such interest, unless otherwise
agreed, such interest shall be transferred in the ratio that the
percentage interest specified in Subsection 1.2 of each Participant
desiring to acquire bears to the total aggregate percentage interests
of all Participants desiring to acquire.
7.5 When the options to acquire all or any part of said
ownership interest have boon exercised, the Participants shall thereby
incur the following obligations:
(a) The Participant desiring to transfer the
ownership interest and the Participant or Partici-
pants having exercised the option to acquire all or
any portion of such ownership interest shall be
obligated to proceed in good faith and with due
diaigence to obtain all required authorizations
and approvals of such acquisition.
(b) The Participant desirinq to transfer such
ownership interest shall be obligated to obtain the
release of any lien encumbering the ownership in-
terest which is the subject of the transfer at the
earliest practicable date.
(c) The Participant or Participants raving
exercised the option to acquire such ownership in-
terest shall be obligated to perform all of the
terms and conditions required of them to complete
the acquisition of said ows.ersbip interest.
7.6 The acquisition of the ownership interest by the
Participant or Participants having elected to acquire the same shall
be fully consummated within sixty (60) days following the date upon
-7-
which all notices required to be given under this Section VIZ have
been duly served.
7.7 If the Participants receiving notice of the proposed
transfer fail to exercise their options to acquire all or some part
of the ownership interest to be transferred, the Partif:ipant desiring
to transfer such interest shall be free to transfer such interest, if
any, as may be left after the exercise of such options to the party
that made the offer referred to in Subsection 7.1 hereof upon the
terms and conditions set forth in said bona fide written offer. If
such transfer is not consummated by the proposed date of transfer
referred to in Subsection 7.2 hereof, the Participant desiring to
transfer said ownership interest must give another complete new right
of first refusal to the remaining Participants pursuant to the pro-
visions of this Section VII before such Participant shall be free to
transfer said ownership interest to another party.
7.8 The Participant or Participants who acquire an owner-
ship interest pursuant to this Section VII shall receive title to and
shall own the interest as tenants in common, subject to the same
rights, duties and obligations as are applied by this agreement to
the interest being transferred in the hands of the transferring Par-
ticipant.
7.9 Any party who may succeed to an ownership interest
pursuant to this Section VIZ shall specifically agree in writing with
the remaining Participants at the time of such transfer that it will
not transfer or assign all or any portion of such ownership interest
without complying with the terms and conditions of this Section Vii.
7.10 It is intended that the provisions of this Section VII
shall, to the full extent permitted by law, continue in effect and be
enforceable by the Participants, their successors and assigns, so long
as two or more of them continue to own an interest in the Lignite.
However, should it be finally determined by a court of competent
jurisdiction that Article I, Section 26 of the Constitution of the
State of Texas or any other constitutional provision, statute or rule
of common law of like import, is applicable to the rights created by
this Section VII, then the agreements contained in this Section VII
shall terminate and be of no further force and effect whenever twenty-
one (21) years less one day shall have elapsed after the death of the
last surviving descendant (living at the date of the earliest execu-
tion of this agreement on behalf of any of the Participants) of any
person signing this agreement in behalf of a Participant in any capacity.
VIII. PROJECT INSURANCE:
8.1 The Pool Committt hall determine the insurance co•ier-
ages, including the insurable v. :s, limits, deductibles, retentions
-8-
and other special terms, to be obtained during the periods covered by
and with respect to the project.
8.2 Each Participant, at its expense, shall have the right
to secure such additional or different insurance coverage as may be
required under any mortgage or contract provision, and, to the extent
practicable, such additional or different insurance coverage may be
effected through endorsements on policies issued pursuant to Subsec-
tion 8.1.
IX. RELATIONSHIP OF PARTICIPANTS:
9.1 The covenants, obligations and liabilities of the
Participants shall be several and not joint or collective. Each
Participant shall be individually responsible for its own covenants,
obligations and liabilities as herein provided. Except as provided
in Subsection 1.3 of this agreement, it is not the intention of the
parties to create, not shall this agreement be construed as creating,
a partnership, association, joint venture or trust, as imposing a
trust or partnership covenant, obligation or liability on or with
regard to any one or more of the Participants, or as tendering the
Participants liable as partners or trustees. No Participant or group
of Participants shall be under the control of or shall be deemed to
control any other Participant or the Participants as a group. No
Participant as such shall be the agent of or have a right or power to
bind any other Participant.
9.2 The Participants elect, under the authority of Section
761(a) of the Internal Revenue Code of 1954, to be excluded from the
application of all provisions of Subchapter K of Chapter 1 of Subtitle
A of the Internal Revenue Code of 1954. If the tax laws of the State
of Texas hereafter contain provisions similar to those contained in
Subchapter K of Chapter 1 of Subtitle A of the Internal Revenue Code
of 1954 under which a similar election is permitted, the Participants
agree to exercise such similar election. The Project Manager is
hereby authorized to file such evidence as may be necessary to give
effect to the election made in this Section 9.2.
X. ACQUISITION OF REAL PROPERTY INTERESTS:
Acquisition of the Lignite leases shall be based upon:
(a) title opinions by counsel, title insurance, or other title show-
ings or combinations of showings; and (b) such survey work and title
curative work as the Pool Committee in its judgment, reasonably exer-
cisel, shall deem necessary. The purchase price and all costs and
expenses incurred in connection with locating of the Lignite and the
acquisition of options to lease and leases, including, but not by
limitation, title insurance premiums, abstracters, attorneys, sur-
-9-
veyors, nominees and land agents fees,. title curative work, court
costs and recording fees, shall be project costs borne by the Par-
ticipants as provided in Subsections 2.1 and 2.2 hereof.
XI, MISCELLANEOUS:
11.1 This agreement shall be governed by the laws of the
State of Texas and shall apply to and bind all persons, firms, cor-
porations or entities claiming by, through or under of the Partici-
pants and upon any successor or assignee of any Participant.
11.2 This agreement shall become effective when it has been
duly executed and delivered on behalf of all of the parties hereto
and shall remain in force and effect, subject to prior termination by
unanimous agreement by all Participants, until the abandonment of and
final disposition of the Lignite.
11.3 Any notice, demand or request provided for in this
agreement shall be deemed properly served, given or made if delivered
in person or sent by registered or certified mail, postage prepaid, to
the Participants at the addresses specified below:
City of Bryan
P. 0. Box 3000
Bryan, Texas 77801 Attention: City Manager
City of Denton
Civic Center
Denton, Texas 76201 Attention: City Manager
City of Garland
P. 0. Box 189
Garland, Texas 75040 Attention: City Manager
City of Greenville
P. O. Box 1049
Greenville, Texas 75401 Attention: City Manager
Brazos Electric Power Cooperative, Inc.
2404 LaSalle
Waco, Texas 76701 Attention: General Manager
Any Participant may, at any time, by written notice to all other
Participarts, designate different or additional persons or different
addresses for the giving of notices hereunder.
11.4 Each Participant agrees, upon request by the other
Participants, to make, execute and deliver any and all documents and
writings of every kind reasonably requested or required to implement
this agreement.
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11.5 The captions and headings appearing in this agreement
are inserted merely to facilitate reference and shall have no bearing
upon the interpretation thereof.
11.6 Each te-,n, covenant and condition of this agreement is
deemed to be an independent term, covenant and condition, and the
obligation of any Participant to perform all of the terms, covenants
and conditions to be kept and performed by it is not dependent on the
performance of the other Participants of any or all of the terms,
covenants and conditions to be kept and performed by them.
11.7 In the event that any of the terms, covenants or
conditions of this agreement, or the application of any such term,
covenant or condition, shall be held invalid as to any person or
circumstance by any court having jurisdiction in the premises, the
remainder of such agreement, and the application of its terms, cov-
enants or conditions to such persons or circumstances shall not be
affected thereby.
11.8 The Participants do not intend to create rights in or
to grant remedies to any third party as a beneficiary of this agree-
ment or of any duty, covenant, obligation or undertaking established
therein.
11.9 Any waiver at any time by any Particpant of its rights
with respect to a default or any other matter arising in connection
with this agreement shall not be deemed a waiver with respect to any
subsequent default or matter.
11.10 This agreement may be supplemented, modified or
amended only by a written instrument executed by all of the Partici-
pants.
IN WITNESS WHEREOF, the Wrtias hereto haze caused this agreement
to be executed as of the 2p---',day of .C 1975.
CITY OF BRYAN
ATTEST: 6Y:
MAYOR
CITY OF DEWtN
ATTEST: J3
May
-11-
CITY OF GARLAND
ATTEST: BY:
Mayor
CITY OF GREENVILLE
ATTEST: BY:
Mayor
BRAZOS ELECTRIC POWER
COOPERATIVE, INC.
ATTEST: BY:
General Manager
c
-12-
RULES AND REGULATIONS OF
TEXAS MUNICIPAL P014ER A(,ENrY
ARTICLE I
OFFICES, NOTICES, PUBLIC RECORDS
Section 1: Principal Office. The principal office of the
Agency in the State of Texas shall he located in the City
of Waco. County of McLennan and may have other offices as the
Board may designate.
Section 2; Notice of Meetings. Written notice of the date,
hour, place and sut~ject cif each meeLiu}; of the Board and of
each Committee shall be given (1) to each member and (2) by
furnishing, such notice to the Secretary of State of the State
of Texas for posting on a bulletin board and (3) by furnishing
such notice to the County Clerk of McLennan County for posting
on a bulletin board in the County Courthouse, and (4) by posting
such notice in its administrative office.
The notice shall be furnished to the Secretary of State and
the County Clerk so it may be posted at least 72 hours preceeding
the day of the meeting, provided that in the event of an emergency
meeting or a meeting, caused by urgent public necessity, the notice
required to be posted shall be posted at least two hours before
the convening of the meeting. Additionally, notice of an
emergency meeting shall be given by telephone or telegraph to any
news media that has (1) filed a request for such information at
the main office of the Agency and (2) agreed to pay any and all
expenses incurred by the Agency in providing such notice.
A member of the Board or of a Committee may waive issuance
of notice of a meeting to himself by (1) an instrument in writing
(executed before or after the meeting) or,(2) by attendance at
the meeting.
Section 3: Meetings Public. All meetings of the Board or its
Committee s5-aIl be open-to the public, except in cases involving
the appointment, employment, evaluation, reassignment, duties,
discipline, or dismissal of a public officer or employee or to
hear complaints or charges egainst such officer or employee,
unless such officer of employee requests a public hearing, nor
shall the Board of any of itc Committees be required to deliberate
in open meetings regarding the development, or specific occasions
for implementation of security personnel or devices.
The public may be excluded from that portion of a meeting
during which a discussion is had with respect to the purchase,
exchange, lease, or value of real property, negotiated contracts
for prospective gifts or donations to the Agency, when such
discussion would (in the opinion of the Board or Committee) have
a detrimental effect on the negotiating position of the Agency
as between such body and a third person, firm or corporation.
Whenever any deliberations or any portion of a meeting are
closed to the public, no final action, decision, or vote with
regard to any matter considered in the closed meeting shall be
made except in a meeting which is open to the public after notice
has been given as herein required.
All or any 1part of the proceedings in any public meeting
may be recorded b.I any person in attendance by means of a tape
recorder or any other means of sonic reproduction.
Private consultor tions between the Agency and its attorney
are permitted in those instances in which the Agency seeks the
attorney's advice with respect to pending or contemplated
litigation. settlement offers, and matters where the duty of
counsel to his client, pursuant to the Code of Professional
Responsibilit- of the State Bar of Texas, clearly conflicts
with the right of the public to have such information under
applicable law.
Section 4: Custodian of Public Records. The General
Managers of the Agency ~i~ appoirite~ ore cted and if not,
the Secretary of the Board) shall be the custodian of all public
records of the Agency and the custodian shall be responsible for
the preservation and care of such public records. It shall be
the duty of the custodian of public records to see that the
public records are made Lvailable for public inspection and
copying; that the records are carefully protected and preserved
from deterioration, alteration, mutilation, loss, removal, or
destruction; and that public records are repaired, renovated, or
rebound when necessary to preserve them properly. When records are
no long currently in use, it shall be within the discretion of
the Agency to determine a period of time for which said records
will be preserved.
. Neither the custodian nor his agent who controls the use of
public records shall make any inquiry of any person who applies
for inspection or copying of public records beyond the purpose.
of establishing proper identification and the public records being
requested; and the custodian or his agent shall give, grant, and
extend to the person requesting public records all reasonable
comfort and facility for the full exercise of the right to examine
and review such records.
On application for public information to the custodian by
any person, the custodian shall promptly produce such information
for inspection or duplication, or both, in the offices of the
governmental body. If the information is in active u;e or in
storage and, therefore, not available at the time a person asks
to examine it, the custodian shall certify this fact in writing
to the applicant and set a date and hour within a reasonable time
when the record will be available. Nothing herein shall authorize
any person to remove original copies of public records from the
offices of the Agency without the written permission of the
custodian of the records.
In the event the custodian of records is of the opinion that
the records or information should not be supplied to the person
requesting them for review, he shall within a reasonable time,
no later than ten days, after receiving a written request for
the records, request a decinion from the Attorney General to
determine whether the information is privileged. The specific
information requested shall be supplied to the Attorney General
but shall not be disclosed until a final determination has been
made. .
No closed or executive meeting or session of the Board or
its Committees for any of the purposes for which closed or
executive meetings or sessions are authorized shall be held
t+i?less such body has first been convened in open meeting or
session for which notice has been given and during which open
meeting or session the presiding officer has publYcly announced
that n closed or executive meeting or session will be held and
identified the section or sections of Article 6252-17, V,A.T.C.S.
authorizing the holding of such closed or executive session.
Section S: Confidential Records. All information collected,
assembled, nr maim<ina~ by the Agency pursuant to law or
ordinance or in connection with the transaction of official
business is public information and available to the public during
normal business hours of the Agency, with the following exceptions
only:
(1) information deemed confidential by law, either
ConsLitutional, statutory, or by judicial decision;
(2) information in personnel files, the disclosure of which
would constitute a clearly unwarranted invasion of personal
privacy; provided, however, that all information in personnel
files of any individual employee of the Agency is to be made
available to that individual employee or his designated represen-
tative as is public information;'
(3) information relating to litigation of a criminal or
civil nature and settlement negotiations, to which the State or
political subdivision is, or may be, a party, or to which'an
officer or employee of the State or political subdivision, as a
• consequence of his office or employment, is or may be a party,
that the Attorney General or the respective attorneys of the
various political subdivisions has determined should be withheld
from public inspection;
(4) information which, if released, would give advantage to
competitors or bidders;
(S) information pertaining to the location of real or personal
property for public purposes prior to public announcement of
the prcject, and information pertaining to appraisals or purchase
price of real or personal property for public purposes prior to
the formal award of contracts therefor;
(6)' drafts and working papers involved in the preparation
of proposed legislation;
(7) matters in which the duty of the Attorney General of Texas
or an attorney of a political subdivision, to his client, pursuant
to the Rules and Canons of Ethics of the State Bar of Texas are
prohibited from disclosure, or which by order of a court are
prohibited from disclosure;
(8) private correspondence and communications of an elected
office holder relating to matters the disclosure of which would
constitute an invasion of privacy;
(9) trade secretA and commercial or financial information
obtained from a person and privileged or confidential by statute
or judicial decision;
(10) inter-agency or intra-agency memorandums or letters
which would not be available by law to a party other than one in
litigation with the Agency;
(11) geological and geophysical information and data including
maps concerning wells, except information filed in connection with
an application or proceeding before any governmental agency;
Section 6: Charges for Public Records. The cost to any
person requesting noncertified ph graph c reproductions of public
records comprised of pares up to legal size shall be the same as
prescribed by law for copies of documents obtained from the
Secretary of State of the State of texas.
Charges made for access to public records comprised in any
form other than up to standard si?ed page.9 or in computer record
banks, microfilm records, or other similar record keeping systems,
shall be set upon consultation between the custodian of the
records and the State Board of Control, giving due consideration
to the expenses involved in providing Lhe public records.
It shall be the policy of the Agency to provide suitable
copies of all public records within a reasonable period of time
after the date copies were requested.
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ARTICLE II
BOARD OF DIRECTORS
Section 1: General Powers. The business and affairs of
the corporation shall be managed by its Board of Directors.
Section 2: Regular Annual Meetings. Regular annual meetings
of the l;oai-d--oT Directors s-1ia T be hcl~ at 10 o'clock A.M. on the
last Thrusday of July. The annual meeting of the Board of Directors
shall be held at the principal office of the Agency.
Section 3: Special Meetings. Special meetings of the Board
of Directors may be caLleccf~y or at the request of the President
or a majority of the Directors. The person or persons authorized
to call special meetings of the Board of Directors may fix any
place, within the State of Texas, as the place for holding
any special meeting of the Board of Directors called by them.
If no designation is made, the place if the meeting shall be
the Principal Office o.`. the Agency.
SECTION 4: quorum. Except as provided in Section 5, five
of the Directors shad constitute a quorum for the transaction
of business at any meeting of the Board of Directors. The
affirmative vote of at least 5 Directors shall be required for
approval of any action.
SECTION 5: Extraordinary Major. (A) At least six (6)
Directors of the gem ncy sfi all constitute a quorum for the adoption
of:
(1) the operating budget of the Agency or an amendment
to the operating budget of the Agency, or
(2) a resolution, order, or other instrument which
approves a capital project, a preliminary capital project
budget, an amendment to a preliminary capital project budget,
a final capital project budget or an amendment to a final
capital project budget,
(3) a resolution, order, or other instrument which
approves the execution of a contract for the sale or exchange
of electric energy or other property of the Agency which has
a value in excess of $20,000,
(4) any amendment to these rules and regulations.
(B) For the purposes specified in paragraph (A) of this
Section, the affirmative vote of five (5) Directors shall be
required for adoption, provided however, at such time as
(1) any contract is executed by and between the Agency
and the Cities of Bryan, Denton, Garland, and Greenville, or
any of them (whereby the Agency is obligated to do or perform
services for such Cities [or any of them]) or
(2) the Agency is obligated to supply electric energy
in the future to such City or Cities in addition to the
affirmative vote of five (5) Directors the affirmative vote
of the required majority in interest of the parties (as
defined in paragraph (C) of this Section) shall be required.
ARTICLE III
OFFICERS
Section 1: Number. The officers of the Agency shall be a
Presiacn[, a Vice President, a Secretary - Treasurer and such
other officers and assistant officers as may be deemed necessary,
each of whom shall be elected by the Board of Directors. The
office of President and Vice President must be filled by a
Director of the Agency.
Section 2: Election and Term of Office. The officers of the
Agency shall be elected annually by the Board of Directors
at the first regular ing of the Eoard of Directors held after
April IS of each year .ach officer shall hold office until his
successor shall have -.n duly elected.
Section 3: Vacancies. A vacancy in any office of any officer.
may be filled by the IIoaid of Directors for the unexpired portion
of the term.
Section 4: The President. The President shall-be the
prime pa executive office~of the Agency, and, subject to the
control of the Board of Directors, shall in general supervise and
control all of the affairs of the Agency. lie shall when present
preside at all meetings of the Board of Directors. He may sign,
with the Secretary or any other proper officer of the Agency
authorized by the Board of Directors, any deeds, mortgages, bonds,
contracts, or other instruments which the Board of Directors has
authorized to be executed, except in cases where the signing and
execution shall be expressly delegated by the Board of Directors
to some other officer or agent of the Agency; and in general
shall perform all duties incident to the office of President and
other duties as may be prescribed by the Board of Directors.
Section S: The Vice President. In the absence of the
President or in the event o h s death, inability or refusal to
act, the Vice President shall perform the duties of the President,
and when so acting, shall have all the powers of and be subject to
all the restrictions upon the President, any' shall perform other
duties as may be assigned to him by the President or by the Board
of Directors.
Section b: Tae Secretary- Treasurer. The Secretary -
Treasure shall keep t e minutes o the Board of Directors meetings;
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see that all notices are duly given in accordance with the
provisions hereof and as required by law; be custodian of the
Agency records; keep a register of the post office address of the
Directors, and of the members of any committee appointed by the
Board of Directors. Such officer shall also have charge and
custody of and be responsible for all funds and securities of the
Agency; receive and give receipts for monies due and payable to
the Agency from any source, and deposit all monies in the name
of the Agency in the depositories selected in accordance with the
provisions of Article V of these by-laws; and perform all of the
duties as may be assigned to him by the President or by the
Board of Directors.
Section 7: Executive Director. The Board may elect to
appoint or employ an Executive Director as the Chief Administrative.
Officer of the Agency. Such officer, if appointed or employed
shall perform such duties as may be assigned by the Board or the
Executive Committee. The Executive Director may hold other
offices of the Agency except- the office of President or Vice
President.
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ARTICLE IV
COMMITTEES
Section 1: Executive Committee. The Board may establish
an Executive Committee composed n£ one director from each of the
Cities of Bryan, Denton, Garland and Greenville. The Executive
Committee may be assigned specified duties of the Board (except
those specified in Section 5 of Article II) between regular
meetings of the Board.
Section 2: Management Committee. The Board may establish a
separate Management ComitCee~et the operating of each Project
undertaken by the Agency. The Management Committee may operate
under the direction of the Board or the Executive Committee,
as determined by resolution of the Eoard.
Section 3: Other Committees. Other Committees not having
and exercising the authority he Board of Directors in the
management of the Agency may be designated by a resolution adopted
by a majority of the Directors present at a meeting at which a
quorum is present.
Section 4: Duration of Committees. Committees may be for
a speciTic Iength o time or may be otiadefinite duration.
Section 5: Term of Office. Each member of a Committee shall
continue as such or the duration of the committee or until his
successor is appointed, or the Committee is terminated, or
he is removed by the Board. Terms shall usually be of one year
duration although the Committee may be of longer duration.
Section 6: Chairman. One member of each Committee shall be
appointed cfFairman~y tt a Board.
Section Vacancies. Vacancies in the membership of any
Committee may be tilledby the Board.
Section 8: Quorum. Unless otherwise provided in the resolu-
tion o the Board o Directors designating a Committee, a
majority of the whole of such Committee shall constitute a quorum
and the act of a majority of the members present at a meeting at
which a quorum is present shall be the act of the Committee..
Section 4: Rules. Each Committee may adopt rules for its
o,4n government not inconsistent with these by-laws or with rules
adopted by the Board of Directors, or with instructions, if any,
contained in the resolution of the Board of Directors establishing
such Committee.
ARTICLE V
CONTRAC'T'S, LOANS, CHECKS AND DEPOSITS
Section 1: Contrncts. The Board of Directors may authorize
the execution and delivery of any instrument in the name of and
on its behalf.
Section 2: Checks, Drafts, Etc. All checks, drafts, or
other^orders or [he payment oT mon.y, notes or other evidences of
indebtedness issued in the name of the Agency shall be signed by
one officer or agent of the Agency and countersigned by another
person as shall be determined by resolution of the Board of
Directors.
Section 3: Deposits. All funds of the Agency not otherwise
employed shall be-deposited to the credit of the Agency in banks,
trust companies or other depositories as the Board of Directors
may select.
Section 4: Gifts. The Board of Directors, or a Committee,
or any oHicer or agent designated by the Board of Directors, may
accept on behalf of the Agency any contribution, gift, bequest,
or devise for the general purposes or for any special purpose of
the Agency. S•
ARTICLE VI
FISCAL YEAR
The fiscal year of the Agency shall be determined by
resolution of the Board of Directors.
ARTICLE VII
AMENDAMNTS
Amendments to these Rules and Regulations may be considered
at any meeting of the Board.
The undersigned Directors of the Agency do hereby certify
the above rules and regulations were duly adopted at the initial
meeting of the Board of Directors on the day of ,
1975.
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(C) 1-1;ijority in interest of the parties, as used in paragraph.
(B) of this Section 5 is determined as follows:
(1) the net usage of electric energy (kilowatt hours) of
each of the members shall be determined for the preceedii,g
12 month period ending on September 30 of each year.
(2) each individual Director attending the meeting
shall be entitled to cast a vote equal to 112 of the kilowatt
hours shown as the net usage of electric energy of the
particular city he represents.
(3) a vote of 51% of the kilowa_t hours of net usage
of electric energy of all members s'-all constitute a majority
in interest of the parties.
Section 6: Preliminary and Final Prot Budgets. A
preliminary capital budget shall be adopted by the Board at tie
time of the approval of a capital budget. Such preliminary budget
shall be the amount which it is anticipated (based upon the then
current estimates) will be expended for the construction and
testing of the capital project prior to the time it is accepted
by the Board or its duly authorized representative. The preliminary
capital budget (or each capital project) may be amended from time
to time as estimates are revised.
A final capital project budget on each capital project shall
be adopted by the Board when the entire capital project is
under contract to be constructed and shall be the amount which
(under the contracts) is to be expended for the construction and
Q testing of the capital project prior to the time it is accepted
by the Board or its duly authorized representative. Change
orders to such contracts (or additional contracts thereafter
executed with respect to such project) shall be considered as
amendments to the final project budget.
Section 7: Com ensation. Directors shall not receive any
compensation for their services, but a Director may be reimbursed
for expenses actually incurred in connection with the business
affairs of the Agency.
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BYLAWS
or
TEXAS POWER POOL, INC.
'Phu namu of this corporation, iLs corporate purpono and the term
of its existence are set forth in the Articles of Incorporation of
this corporation as filed with the Secretary of State of the State of
Texas, on the clay of _ , 1975, as the same may from
time to time be'amended. All rovisioiis of these Bylaws are subject
to the provisions of the Articles of Incorporation.
ARTICLE I
OFFICES
Section 1. Principal Office. The principL office of the cor-
poration in the Suite of Teas shall b! located in the City of Waco,
County of McLennan.
Section 2 Registered Office and Rcjistered Agunt. 'The regis-
tered office and agent of tiie corporation required by the Texas Non-
Profit Corporation Act to be maintained in the State of Texas shall be
as indicated by the Articles of Incorporation. The registered office
or the registered agent may be changed by notifying the Secretary of
State of tho State of Texas if such change is approved by a vote of a
majority of the Directors at a legally called meeting of the Board of
Directors.
Section 3. Other Offices. The corporation may have other offices,
either withi. or without the State of Texas, as the hoard of Directors
may desig;iate.
ARTICLE II
BOARD Or DIRECTORS
Section 1. General Powers. The business and affairs of the
corporation shall beminaged by its Board of Directors.
Section 2. Number, Tenure and Qualifications. The number of
directors of the corpor to ion shall be term (10). The Board of Di-
rectors named in the Articles of Incorporation shall serve as the
initial Board of Directors until the close of the first annual meeting
r
. A
Of Lhe Corporation, At Hie first annual moo Ling, Len (10) dirocLors
shall be clocbt 1, and those el-ocLcd ::h rill he the persuns who on that
date hold the ho:,iLion indicated for Lhat position as follows:
Place Number Posi.Lion held by such person
1 City Manager, Bryan, Texas
2 Uti.liLies Director, Bryan, Texas
3 City Manager, Denton, Texas
h Utilities Director, Denton, Texas
5 City Manager, Garland, Texas
G Utilities Director, Garland, Texas
7 City Manager, Greenville, Texas
8 Utilities Director, Greenville
Texas
9 General Manager of Brazos Electric
Power Cooperative, Inc.
10 Executive Assistant to General
Manager of Brazos Electric
Power Cooperative; Inc.
The person holding the position specified (either on a permanent or
acting basis) shall automatically be a number of the Board and hold
the place number specified unless (1) the governing body of the entity
he represents (a) designates another official or representative for
such entity by filing a certified copy of the resolution which desig-
nates another representative with the Secretary of the corporation,
(b) notifies the corporation the entity wishes to withdraw from fur-
ther participation in the governing of the corporation, or (2) the
person refuses to serve as evidenced by an instrument in writing.
A temporary vacancy in office in position 1 through 8 may be
filled by the Board of Directors of the Texas Municipal Power Agency,
and a vacancy in office in position 9 and 10 may be filled by the
General Manager of the Brazos Electric Power Cooperative, Inc., but a
person so named shall serve only until a permanent director is again
named or selected as provided in the preceding paragraph.
No Director of the corporation, by reason of his appointment by
an entity or person, shall be deemed to be acting as a representative
or agent of the entity so appointing the Director.
Section 3. Reqular Meetings. A regular annual meeting of the
Hoard of Directors shall be head without other notice than these •
Bylaws at 10:00 a.m. on the fourth Thursday in October of each year at
the Principal Office of the corporation. The Board of Directors may
provide, by resolution, the time and place, either within or without
the State of Texas for the holding of additional regular meetings
without other notice than such resolution.
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Section A. special Meeting,,. Special meetings of the board of
Directors may bo called by or at Lhc request of the President or a
majority of the Directors. The person or persons auLhorized Lo call
special meeLings of the Board of Directors may fix any place, either
within or without the State of Texas, as the place for holding any
special meeting of the Board of Directors called by them. If no
designation is made, the place of the meeting shall be the Principal
Office of the corporation.
Section 5. Notice. Notice of the place and time of any special
meeting of the Board-oC Directors shall tx: given, either in writing or
verbally, to each member of the Board at least four days prior to such
meeting; provided, however, if such notice is by mail, it shall be
given at least seven days prior to such meeting. If verbal notice is
given, it shall be deemed to have been given when the Director is
notified personally of the place and time of the meeting. If written
or printed notice is given, it shall be deemed to have been given when
actually delivered to the person or, if mailed, when deposited in the
United States mail addressed to the Director aL his or her address as
it appears on the appropriate records of the corporation, with postage
prepaid. A waiver of notice in writing signed by a Director entitled
to such notice, whether before or after the meeting, shall be'deemed
equivalent to the giving of such notice to such Director in a timely
manner. Any such signed waiver of notice shall be placed in the
minute book of the corporation. lfhe attendance of a Director at a
meeting shall constitute a waiver of notice of the meeting, except
where a Director attends a mceLing for the express purpose of ob-
jecting to the transaction of any business because the meeting is not
lawfully called or convened. Neither the business to be transacted
at, nor the purpose of, any regular or special meeting of the Board of
Directors need be specified in the notice or waiver of notice of the
meeting.
Section 6. Quorum. One more than a majority of the number of
dx*r~.cors fixed by Section 2 of this Article II shall constitute a
quorum for the transaction of business at any meeting of the Soard of
Directors.
Section 7. Manner of Actill Subject to the provisions of
Section 2 of Artie a Ii and Article IX of these Bylaws, the act of a
majority of the total number of Directors fixed by Section 2 of this
Article, at a meeting at which a quorum is present, shall be the act
of the Board of Directors.
Section 8. Waiver. Any action required to be taken at a meeting
of the members of the Board of Directors or a Committee created pur-
suant to Article IV may be taken without a meeting if a consent in
writing, setting forth the action to be taken, is signed by all the
members of the Board or Committee, as the case may be, that are en-
titled to vote with respect to the subject matter thereof. Such a
consent shall have the same force and effect as a unanimous vote.
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Section 9. Cc~m~>cnsalion. Directors shall not receive any com-
pensutica for the n= sci=viecs, but a Director may be re.imbursed for
expenses acLually incurred in connection with the business affairs of
the corporation.
ARTICLE III
OFFICERS
Section J. tdumber. Tho officers of the corporation shall be a
President, one or more Vice Presidents (thn number to be determined by
the Board of Directors), a Secretary, a Treasurer., an rxecutive Director
and such other officers and assistant officers as may be deemed neces-
sary, each of winom shall be elected by the Board of Directors. The
offices of President and Vice President only must be filled by a
Director of the corporation.
Section 2. Election and Term of.Officc. The officers of the
corporation shall be elected annually by the Board of Directors at the
annual mccLing of the Board of Directors. Each officer shall hold
office until his successor shall have been duly elected and shall have
qualified or until his death or until he shall resign, or until he
shall have been removed in the manner hereinafter provided.
Section 3. Removal. Any officer or agent elected or zppointed
by the Board of Directors may be removed by the Board of Directors
whenever there is shown a sufficient cause, and the best interest of
the corporation would be served, but such a removal shall be ti.ithout
prejudice to any contract rights of the person removed.
Section 4. Vacancies. A vacancy in an,,, office because of death,
resignation, removal, disqualification or otherwise, may be filled by
the Board of Directors for the unexpired portion of the term.
Section 5. The President. The President shall be the principal
executive officer of the corporation, and, subject to the control of
the Board of Directors, shall in general supervise and control all of
the affairs of the corporation. lie shall when pr-,sent preside at all
meetings of the Board of Directors. He may sign, with the Secretary
or any otlier proper officer of the corporation authorized by the Board
of Directors, any instruments which the Board of Directors I.as autho-
rized to be executed, except in cases where the signing and execution
shall be expressly delegated by the Board of Directors to some other
officer or agent of the corporation; and in general shall perform all
duties incident to the office of President and other duties as may be
prescribed by the Board of Directors.
Section o. The Vice Presidents. in the absence of the President
or in the event of his death, inability or refusal to act, the Vice
President (or in the event there be more than one Vice President, the
Vice Presidents in the order designated at the time of their election,
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or in Chu ab,ence of any designation, then in Lhe order of their
electiuu) shall perform the duties of Lhc ]'resident, and when so
acting, shall have all the mowers of and be subject to all L'he re-
stricCions upon Chu President, and shall perform other duties as may
be assigned to him by Lhe President, or by the Board of Directors.
Section 7. The Secretary. The Secretary shall J:cep the minutes
of the hoard of Dircalors_miielinys; see that all notices are duly
given in accordance with the provisions of these Bylaws or as required
by law; be custodian of the corpora Le records; keep a register of the
post office address of the directors, and of the members of any
committee appointed by resolution of the Board of Directors and in
general perform all duties incident to the office of Secretary and
other duties as may be assigned to him by the President or by the
Board of Directors. The Secretary shall also file notice of change of
the registered agent or registered office of the corporation with the
Secretary of State, and such other reports with such office as may be
required under the law.
Section 8. The Treasurer. The Treasurer shall have charge and
custody of and be responsible for. all funds and securities of the
corporation; receive and give receipts for monies due and payable to
the corporation from any source, and deposit all monies in tho name of
the corporation in the banks, trust companies or other depositories as
shall be selected in accordance with the provisions of Article V of
these Bylaws; and in general perform all of the dut`i'es incident to the
office of Treasurer and other duties as may be assigned to him by the
President or by the Board of Directors.
Section 9. The Executive Director. The Executive Director shall .
be the chief administrative offiicer of the corporation and in general
perform all of the duties incident to the office of chief adminis-
trative officer and other duties as may be assigned to him by the
President or by the Board of Directors.
Section 10. Restrictions on Pecuniary Benefits. No Director of
the corporation shall receive any cc.apertsatiai from the corporation if
hd or she is a member of the governing body of or an officer or em-
ployee of a political subdivision of the State of Texas with which the
corporation has a contractual or other business relationship.
ARTICLE IV
COMMITTEES
Section 1. Committees of Directors. The Board of Directors, by
resolution adopted by a majority of the directors in office, may
designate one or more committees, each of which shall consist of three
or more directors, which committees, to the extent provided in said
resolution, shall have and exercise the responsibilities assigned to
them by the Board of Directors.
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SucL.ion 2. Other Commi Uco.:7. OLher c:omm tLces way be designatcd
by a resolution adujilcil'hy ii inajuriLy of l•he director:: present at a
mccting at which a cluorum is pr.cscnt or by Lhc President if authorized
by a like resolution of the board of Directors. Such coimnitLeus may
be for a specific length of time or may be of indefinite duration, but
shall be for the performance of specific duties or functions.
Section 3. 2'erm of Office. Each member of a committee shall
continue as such for the durat.'ion of Lhe commi.L-tec or until his
succespor is appointed, or the conunitLee is terminated, or he is
removed by the authority by which appointed. 'Perms shall usually be
of one year duration although the committee may be of longer duration.
Section 4. Chairman. One member of each committee shall be
appointed chairman by the resolution of the Board of Directors creat-
ing the committee.
Section S. Vacancies. Vacancies.in the membership of any com-
mittee may be filled by appointment- made in the same mr.nner as pro-
.vided in the case of the original appointments.
Section 6. Quortun. Unless otherwise provided in the resolution
of the Board of Directors designating a committee, a majority of the
whole of sucli committee shall constitute a quorum and the act of a
majority of the members present at a meeting at which a quorum is
present shall be the act of the committee.
Section 7. Rules. Each committee may adopt rules for its own
government not inconsistent with these Bylaws or with rules adopted by
the Board of Directors, or with.instructions, if any, contained in the
resolution of the Board of Directors establishing such committee.
ARTICLE V
CONTRACT"S, LQ.,NS, CHECKS, DEPOSITS AND BORROWED FUNDS
Section 1. -Contracts. The Boari of Lirectors may authorize any
officer or officers, agent or agents, to enter into any contract or
execute and deliver any instrument in the name of and on behalf of the
corporation, and this authority may be general cr confined to specific
instances.
Section 2. Checks, Loans, Etc. All checks, drafts, or other
orders for the payment of money, notes or other evidences of indebt-
edness issura9 in the name of the corporation shall be signed by an
officer or cfficers, agent or agents of the corporation as shall be
determined by'resolution of the Board of Directors. In the absence of
such determination by the Board of Directors, such instruments shall
be sighed by the Treasurer or any assistant Treasurer and counter-
signed by the President or a Vice President of the corporation.
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Section 3, 1WposiLes. All fund; of tho corporat or not oLherwise
cmploycd !;hall beduj)osited to the crcdiL• of the corporation in
banks, truoL companies or other depositories as the Board of Directors
may select.
Section 4. Gifts. The Board of Directors, or a committee, or
any officer or agent iiesignated by the Board of Directors, may accept
on behalf of the corporation any contribution, gift, becluest, or
devise for the general purposes or for any special purpose of the
corporation.
Section 5. Borrowed Funds. The corporation shall not borrow
funds upon terms which provide for maLurity exceeding twelve months
and, even then, shall not borrow funds unless the corporation has
contractual agrecmcnt-s with one or more parties which will provide
the revenues to pay the debt within such twelve month period.
ARTICLE VI
BOOMS AND RECORDS
The corporation shall keep correct and complete books and records
of account and shall keep minutes of the proceedings of its Board of
Directors, and committees having any authority of the Board of'Di-
rectors and shall keep at its registered office or principal office in
this State a record of the members of the Board of Directors entitled
to vote.
ARTICLE VII
FISCAL YEAR
The giscal year of the corporation shall be determined by resolu-
tion of the Board of Directors.
ARTICLE VIII
DISTRIBUTION OF ASSETS
Upon dissolution of the corporation, the assets remaining after
satisfaction of all liabilities and obligations of the corporation and
after returning, transferring or conveying assets hold by the cor-
poration upon conditions requiring return, transfer or conveyance in
the event of dissolution, shall be distributed to the Cities of
Bryan, Denton, Garland and Greenville located in the State of Texas in
such undivided interests as the resolution to dissolve specifies.
ARTICLE IX
AMEND14ENTS
The Board of the corporation, at any legally called meeting, by
unanimous vote of the Directors then serving may (1) alter, amend or
repeal these Bylaws and adopt new Bylaws, or (2) dissolve the cor-
poration. The term "Directors then serving" as used in the preceding
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sentence mr.,uns all or L•he Directors of the corporation except those 1
who have noL- aLLendcd a mF_eting of Lhe Board for a period of ninety
(90) days or four (4) consecuLivo meetings (whichever is the longer
period), and such tern irLcludas Lhoso appointed to fill a temporary
vacancy under Article II, Section 2.
The undersigned Directors of tho corporation do hereby certify
the above Bylaws were duly adopted for the regulation of the affairs
of the corporation, at the initial wceting of the Board of Directors
on the day of 1975.
J. Louis Odle
Jack Ard
Jim White
Douglas F. Blackburn
Charles E Duckworth
Ed Krause
James DeBerry
Robert E. Nelson
Ross A. Seqrest
W. S. Robson
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ACCJIJIIJLY THi U'+')CtSiG'tEJ. AS SJ::!I zp4LAE(A'iY OF STATE• AND BY
VItiTJe, o~ r{i Air'iJttitY 'J:STF) I'I OVI UY L A4J HeReby ISSUES (HIS
CERrIFICarc avJ 1rrACtE3 4E14ETJ T'i: U111)LICA JtI31aAL•
-a DATED AUJ• 1-) S
t ~t • I
lTr Secretary or Slote
b•'4l ~l~j~.
4'
ARTICLES OF INCORPORA1.10N
OF
TEXAS POWER POOL, INC.
JIB, the undersigned natural persons of the age of twenty-one
years or more, at least two of tahom are citizens of the State of
Texas, acting as incorporators of a corporation under the Texas Non-
Profit Corporation Act, do hereby adopt the following Articles of
incorporation for such corporation:
ARTICLE ONE
The name of the corporation is "Texas Power Pool, Inc."
ARTICLE TWO
The. corporatior, is a non--profit corporation.
ARTICLE THREE
The period of its duration is perpetual.
ARTICLE FOUR
The Corporation is formed (at the request of the Board of Directors
of the Texas Municipal Power Agency, a municipal corporation and a
political subdivision of the State of Texas) for the purpose of con-
tracting with one or more entities (as such term is defined in Section
2 of Article 1435a, V.A.T.C.S.) who have joined together in the plan-
ning, financing, acquisition, construction, ownership, leasing, opera-
tion or maintenance of electric generating units and plants, electric.
transmission lines, related fuel supplies, and other electric facilities
pursuant to Article 1435a, V.A.T.C.S. whereby this corporation will
(i) perform certain personal or professional services, and (ii) do and
perform certain work for and on behalf of such entities, or (iii)
cause such services to be rendered or work to be performed, all as may
be sFeeified in the contract bj and between such corporation and said
entities.
ARTICLE FIVE
• The street address of the initial registered office is Forest
Park Center, 7111 Bosque DoulcNard, Waco, Texas 76710, and the name
of ito initial registered agent at such address is Paul it. Cunningham.
MUICLL' SIX
The corporation is to have no members, and its affairs shall be
managed by a Board of Directors.
The number of directors constiLuL•ing the initial hoard of Direc-
tors of the corporation is ten {10} and the names and addresses of the
persons who are to serve as the initial directors are:
NAIIE ADDRESS
J. Louis Odle 300 South Washington
Dryau, Texas 77801
Jack Ard 300 South Washington
Bryan, Texas 77801
Jim White 225 East McKinney,
Denton, Texas 76201
Douglas F. Blackburn 215 i?ast McKinncy
Denton, Texas 76201
Charles E. Duckworth 200 north 5th
Garland, Texas 75040
Ed Krause 200 North 5th
Garland, Texas 75040
James DeBerry 2821 Washington
Greenville, Texas 75401
Robert E. Nelson 2821 Washington
Greenville, Texas 75401
Ross A. Segrest 2404 LaSalle
Waco, Texas 76706
W. S. Robson 2404 LaSalle
Waco, Texas 76706
ARTICLE SEVEN
The name and address of each incorporator is:
NAME ADDRESS
`st Ross A. Segrest 2404 LaSalle
Waco, Texas 76706
r`. Paul n. Cunningham 7111 Basque Boulevard
Waco, Texas 76710
J. Rodney Lee 000 First National Building
Waco, Texas 7G701
ARTICLE EIGUT
' The corporation shall be primarily engaged in promoting the
caa.;aa .ood and'7cncral --Ifare of the people in the areas served
by the entities served by the corporation. No part of the income,
: .2-
• l.c:venu0li'llr iLL+ GL ilia CUS',"JOS tt1U11 0111Z.L lnll.l'!? tCT UY 1JC lla('.dUr
the benefit of Zlly privi•L-e purpose, but this provision ;hall riot
prevent the execution of employment contracts With alnployces of the
corporation on such terms as the Board of Directors may approve.
The Directors of the corporation shall scrv!- withouL compensation
but may be reimbursed for expenditures made by them in the conduct of
the business affairs of the corporation. A Director may not be an
employee of the corporation.
Upon dissolution or liquidation of the corporation, all assets
and properties belonging to the corporation shall be transferred and
conveyed to the political subdivision or subdivisions of the State of
Texas designated in the Bylaws of. the corporaLion at the 'time of such
dissolution or liquidation, eitier jointly or otherwise, as shall be
provided in said Bylaws, but if sucli provisions are not contained in
the Bylaws at such time, then all assets and properties shall be I
transferred and conveyed to the Cities of Bryan, Garland, Greenville 1
and Denton jointly.
ARTICLE 14I14C
No ntract or other transactions between the corporation and any
of its 1'.actors or officers (or any corporatiun or cntity :1. Khir?h
any of ' Berl are directly or indirectly interested as a share"older,
_ owner#' .'.rector, officer, official or otherwise) shall be invalid
solely -.cause of this relationship or because of the presence of such
director or officer at the meeting authorizing such contract or trans-
action, or his or her participation in such meeting or authorization
providing (1) the material facts of the relationship or interest of
each such director or officer are known or disclosed to the Board of
Directors and it nevertheless authorizes or ratifies the contract or"
transaction by a majority of the directors pres--nt, each such in-
terested director to be counted in determining whether a quorum is
present but not in calculating the majority necessary to carry the
vote and (2) the contract or transaction is fair to the corporation as
of the time it in authorized or ratified by the Bcard of Directors.
This provision shall not be construed to invalidate a contract or
transaction which would be valid in L,/c absence of this; provision.
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The corporation shall indeuuiify asiy dirccLor or officer or former
director or officer of the corporaL.ion for expoilses and costs (includ-
ing attorneys' fees) actually and necessarily incurred by him or her
in connection with any claim asserted against him or liar, by action in
court or otherwise, by reason of his or her being or having been such
director or officer, excepL in relation to matters as to which he or
she shall have been guilty of negligence or misconduct in respect of
the matter in indemnity is sought.
l oss `A. Scgres
n
Paul It. Cunningaam
4.7
Rodney L~C
THE STATE OF TEXAS X
COUNTY OF McLENNAN X
a Notary Public in and fort
McLennan ounty, -i'exas, do herG9by certify that on this the day
of cc! , 1975, personally appeared before me, Ross A. Segrest,
Paul R.'Cununningham and J. Rodney Lee, each of whom being first duly
sworn declared that he is one of the persons who signed the foregoing
document as an incorporator, and that the statements therein contained
are true.
IN WITNESS 1,711EP.EOF, I have hereunto set my hand and seal the day
and year first above written.
~ls1J_ ~
- Notary p,iht zc a and fdt
McLennan County, Texas
My commission expires June 1, 1977.
,
Draft No. 3
9-19-75
SPECIFICATION OF THE MANNER IN WHICH
PART OF THE MAINTENANCE AND OPERATING EXPENSES
OF THE CORPORATION WILL BE PAID BY THE AGENCY
THIS INSTRUMENT is a part of the contract made and
entered into as of the day of September, 1975, by and
between the Texas Municip'aower Agency (hereinafter called
"Agency"), a municipal corporation and a political subdivision
of the State of Texas, and the Texas Power Pool, Inc.,
(hereinafter called "Corporation"), a corporation heretofore
created and established under the Constitution and laws of
the State of Texas:
W I T N E S S E T H
WHEREAS, under the provisions of Article 1435a, V.A.T.C.S.,
entities engaged in the generation, transmission, or distribution
of electric energy may join together as co-tenants or co-
owners in the planning, financing, acquisition, construction,
ownership, operation and maintenance of electric generating
units and plants, electric transmission lines and other
electric facilities; and may enter into agreements for the
planning, financing, acquisition, construction, ownership,
operation and maintenance of jointly owned and operated
electric facilities; and
WHEREAS, acting pursuant to Section 4(a) of Article
1435a, V.A.T.C.S., the Texas Municipal Power Agency has been
created and established as a municipal power agency (without
taxing power) as a separate municipal corporation, a political
subdivision of the State and a body politic corporate, and
such agency has and may exercise all of the powers which are
by Chapter 10 of Title 28, Revised Civil Statutes of Texas,
1925, as amended, and Article 1435a conferred upon a public
entity or entities; and
WHEREAS, the Agency is empowered to make contracts and
agreements with municipalities, political subdivisions of
the State, and public or private corporations or persons and
perform all acts necessary for the exercise of the full
powers invested in it; now, therefore,
THE PARTIES HERETO, IN CONSIDERATION OF THEIR MUTUAL
AGREEMENTS AND UNDERTAKINGS HEREBY FURTHER CONTRACT AND
AGREE AS FOLLOW :
ARTICLE I
SECTION 1.01: The parties hereto have executed an
agreement known as a Preliminary Participation Agreement,
and this instrument is a part of that Agreement.
SECTION 1.02: The purpose of this contract is to make
provis oT n for a payment of a part of the maintenance and
operating expenses of the Corporation, and this contract
shall remain in force and effect during the time that the
debt of the Agency is outstanding and then continue in force
for a period of ninety (90) days and until three monthly
payments (for which provision is made by Section 2.02) have
been made.
.1 .
ARTICLE II
SECTION 2.01: As used in this instrument, the term
"debt oche Agency" means the principal of, interest on,
reserve fund for, and any applicable redemption premium with
resRect to the initial series of bonds of the Agency known
as 'TEXAS MUNICIPAL POWER AGENCY REVENUE BONDS, SERIES
1975," dated September 15, 1975, to be authorized in a
principal amount of not to exceed $10,625,000. The term
does not include any bonds or other obligations issued for
the purpose of refunding, cancelling, and in lieu of such
Series 1975 bonds. The parties contemplate that a new
contract will be executed in the event such Series 1975
bonds are refunded or if additional bond obligations are
issued by the Agency.
SECTION 2.02: For and in consideration of the undertakings
of the Zorporation hereunder, the Agency agrees it will make
payments to the Corporation of the following payments:
.15 mills for each kilowatt hour of net energy for load
of its member cities during the fiscal year of the
Agency. The term "net energy for load" shall have the
meaning set forth on F.P.C. form, 12 E-1, page 5,
Schedule I; i.e., the system net generation plus energy
received from others minus energy delivered to others.
The amount due from the Agency shall be divided into 12
approximately equal monthly payments based upon the
estimated net energy for load of the member cities.
Such estimate to be made as follows: (1) on or before
the first day of each fiscal year, the utility director
of each city shall file (with the Executive Director of
the Agency) a report containing his estimate of the net
energy for load for the such city for the following 24
month period and from such report the arithmetic average
of the particular year shall be determined (such report
may be amended by the utility director of a city not
more than twice in any one fiscal year) and (2) the
arithmetic average of net energy for load of each
particular city for the preceding fiscal year of the
Agency shall be calculated, and (3) if the estimate of
the utility director is not timely filed the average of
net energy for load on the historical 12 month period
shall be used until such estimate is filed but if the
estimate is filed the higher of the calculations obLained
under (1) _.id (2) above shall be used L, the estimated
net energy for load. Within 10 days of the close of a
fiscal year, the Executive Director of the Corporation
shall redetermine the amount which should have been
paid in the preceding fiscal year and the additional
amount due shall be billed to the Agency or credit
shall be given to the Agency on the billing which
becomes due October 15. If the additional amount due
from the Agency is more than 5% of the amount
paid by the Agency during the preceding year, an amount
equal to 10% of the amount due shall be added to the
statement and shall be paid by it.
_2_
;s
Such payments shall be made on or brfore the 15th day
of each month, commencing October 15, 1975, and the
Corporation covenants that :Honey received under this
agreement will be used only for the purpose of paying
its maintenance and operating expenses and only for
items or expenses which have been included in a proper
budget or budget amendment (including temporary budget).
The amount to be paid for each kilowatt hour of net
energy for load shall be subject to adjustment from time to
time in the following manner:
(1) It may be raised if the Corporation notifies the
Agency that the amount of income being received for the
payment of maintenance and operating expenses is not sufficient
for the purpose and that the amount being collected from
each entity contracting with the Corporation is being
increased proportionately; such notice shall show the bac:is
of the adjustment (increase) so as to provide not less than
the amount budgeted for such expenses during the then fiscal
year and not more than 110% of such budgeted amount. No
raise in the amount due from an entity shall be effective
until such entity has received 30 days notice of the revision,
but the Agency may delay paying the increased amount until
sixty (60) days after the receipt of such notice of revision
if the Agency has been notified a city has elected to delay
such payment for that period and the entire amount due
from the effective date of the increase will be paid on the
sixtieth day.
(2) it shall be decreased if the amount received by
the Corporation for the payment of the maintenance and
operating expenses exceeds 125% of the amount shown in the
budget therefor (for the then current fiscal year) and the
millage rate will be reduced so as to provide not less than
the amount budgeted for such expenses during the then current
fiscal year and not more than 110%vf such budgeted amount.
Any surplus (an amount in excess of 110% of the araount
budgeted for such expenses) shall be either:
(1) applied as a deduction from the amount due from
the Agency during the next succeeding month or months, or
(2) maintained as working capital by the Corporation,
as directed by the entities who provided the funds. In the
absence of a direction bein received from the Agency money
supplied by the Agency shall be applied as a deduction.from
the amount due from the Agency. Any surplus which is in
excess of 125% of the amount shown in the budget for maintenance
and operating expenses shall be returned to the entities who
supplied the funds. The credits or repayment of funds shall
be gly . or made in the a proportion as the funds were
originally paid for such expenses.
It shall be the duty of the Executive Director of the
Corporation to make the calculations with respect to the
. rate per mill to be collected for each kilowatt hour of net
energy for load.
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A '
SECTION 2,03: Should the Agency fail to make any
payment at the t mes herein specified, interest on such
amounts shall accrue at the rate of ten per centum (10%) per
annum from the date such payment becomes due until paid in
full with interest as herein specified. In the event such
payment becomes due, the Corporation may institute a proceeding
for mandamus or a mandaLury injunction requiring the payment
of the amount due and interest thereon, such action to be
instituted in a court of competent jurisdiction.
SECTION 2.04: The payments required to be made by the
Agency un er 5e`terms of this contract shall be due and
payable as herein specified, and the Agency shall have no
right of setoff, recoupment or counterclaim against such
payment. The Corporation shall never have the right to
demand payment of any obligation assumed by the Agency out
of funds raised or to be raised by taxation.
SECTION 2,05: The Corporation may not pledge all or
any part of-the payments to be received from the Agency
under this agreement, but this provision shall not be construed
as prohibiting the Corporation's pledge of such payments (or
part thereof) to the payment of a temporary bank loan made
to the Corporation:
(i) for the purpose of paying maintenance and operating
expenses of the Corporation, and
(ii) where the princi;al of and interest on the temporary
bank loan is due and payable:
(a) within 12 months, and
(b) does not exceed that amount scheduled to be
paid by the Agency and Brazos while the loan
is unpaid.
SECTION 2.06: (a) Agency represents and covenants that
all payments to be made by it hereunder shall constitute
"operating expenses" of its electric system.
(b) Agency further agrees to fix and collect such
rates and charges for utility services to its customers as
will, in combination with any other funds legally available
and reasonably assured for the purpose, make possible the
prompt payment of all expenses of operating and maintaining
its utility system and all payments contracted hereunder.
ARTICLE III
SECTION 3.01: Subject to the provisions of Sectior:
8.14 ool- e-Preliminary Participation Agreement, this contract
may be changed and modified only with the consent of the
governing bodies of the Corporation and the Agency. Such
modification may be requested by any of such parties, in
which event a joint meeting of the governing bodies or of
their duly authorized and appointed representative shall be
held not less than fifteen (15) days after the giving of
such notice. At such joint meeting the suggested changes or
modifications shall be considered, discussed and settled. No
such change or modification may be made which will affect
adversely the pa;^nent when due of all monies required to be
paid by the Agency :finder the terms of this contract and no
such change will be effective which affects adversely or
causes a violation of any covenants contained in the resolution
or order authorizing; the issuance of the Agency's bonds.
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it
SECTION 3.02: This contract shall be subject to all
valid rules, regulations and laws applicable thereto, as
promulgated by the United States of America, the State of
Texas, or any other governmental body or agency having
lawful jurisdiction or any authorized representative or
agency of any of them.
SECTION 3.03: (a) If for any reason of "force majeure"
any oFTt e-parties hereto shall be rendered unable wholly or
in part to carry out its obligations under this agreement,
other than the obligation of the Agency to make the payments
required under the terms hereof, then if such party shall
give notice and full particulars of such reasons in writing
to the other party within a reasonable time after the occurrence
of the event, or cause relied on, the obligation of the
party giving such notice, so far as it is affected by such
"force majeure", shall be suspended during the continuant,3'
of the inability then claimed, but for no longer period, and
any such parties shall endeavor to remove or overcome such
inability with all reasonable dispatch. The term "force
majeure" as employed herein shall mean acts of God, strikes,
lock-outs, or other industrial disturbances, acts of public
enemy, orders or actions of any kind of the Government of
the United States or of the State of Texas or any civil or
military authority, insurrections, riots, epidemics, landslides,
lightning, earthquakes, fires, hurricanes, storms, floods,
washouts, droughts, arrests, restraints of government and
people, civil disturbances, explosions, breakage or accident
to dams, machinery, pipelines, or canals or other structures
or machinery, on account of any other cause not reasonably
within the control of the party claiming such inability. It
is understood and agreed that the settlement of strikes and
lock-outs shall be entirely within the discretion of the
party having the difficulty, and that'the above requirement
that any force majeure shall be remedied with all reasonable
dispatch shall not require the settlement of strikes and
lock-outs by acceding to the demand of the opposing parties
when such settlement is unfavorable to it in the judgment of
the party having the difficulty.
(b) No damage shall be recoverable from the Corpora-
tion by reason of the causes above mentioned.
SECTION 3.04: Any notice, request, demand, statement
or bill providecr-for in t:i'.s agreement shall be in writing
and shall be considered to have been duly delivered when
sent by registered or certified mail, addressed as follows:
Agency: Texas Municipal Power Agency
Forest Park Center
7111 Bosque Blvd.
Waco, Texas 76710
Attention: Executive Director
Corporation: Texas Power Pool, Inc.
Forest Park Center
7111 Bosque Blvd.
Waco, Texas 76710
Attention: Executive Director
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5
as the case may be, except that routine commmunications may
be sent by ordinary mail and except that either party, by
the filing of an appropriate written notice to the others,
may specify some other individual to whom communications
thereafter are to be addressed.
SECTION 3.05: The Corporation covenants that it will
enforce Me obT gations of the Agency hereunder (as well as
any obligations contained in similar contracts with additional
contracting party) as may be required to accomplish the
purpose of this contract. Either party may enforce any
obligations hereunder owed by it by the other party.
SECTION 3.06: The parties hereto agree that if any of
the provisTo-ns oT this contract contravene or be held invalid
under the laws of this State, same shall not invalidate the
Y7:,ole agreement but it shall be construed as though not
containing that particular provision and the rights and
obligations of the parties shall be construed and in force
accordingly.
IN WITNESS WHEREOF, the parties hereto, acting under
authority of their respective governing bodies, have caused
this contract to be duly executed in several counterparts,
each of which shall constitute an original, all as of the
day and year first above written.
TEXAS POWER POOL, INC. TEXAS MUNICIPAL POWER AGENCY
By By
esi ent, ar o Directors President, Board o rectors
ATTEST: ATTEST:
Secretary, Boar o D rectors Secretary, Boar o rectors
(Corp. Seal) (Agency Seal)
THE STATE OF TEXAS X
COUNTY OF X
BEFORE ME, the undersigned authority, in and for the said
County on this day personally appeared
President of the Board of Directors of TEXAS POWER 70r. INC.$
known to me to be the person whose name is subscribed to the
k
F.
rj.
s
-b-
foregoing instrument and known to me to be the President of
the Board of Directors of TE"AS POWER POOL, INC, and acknow-
ledged to me that he executed the same for the purposes and
consideration therein expressed and in the capacity therein
stated as the act and deed of said Corporation.
GIVEN UNDER MY NAND AND SEAL OF OFFICE, this the
day of 1975.
Notary Public,
County, Texas
(Notary Seal)
THE STATE OF TEXAS X
COUNTY OF X
BEFORE ME, the undersigned authority, in and for the
said County on this day personally appeared
President of the oar o rectors
o the TEXAS MUNIMPA Zn7ER AGENCY, known to me to be the
person whose name is subscribed to the foregoing instrument
and known to me to be the President of the Board of Directors
of TEXAS MUNICIPAL POWER AGENCY, and acknowledged to me that
he executed the same for the purpose and consideration
therein expressed and in the capacity therein stated as the
act and deed of said TEXAS MUNICIPAL POWER AGENCY.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this the
day of 1475•
Notary Publ
County, Texas
(Notary Seal)
,k
i,
lam.
B-C
Draft No. 5
10-3-75
CONTRACT FOR THE PERFORMANCE OF CERTAIN DUTIES
THIS INSTRUMENT is part of a contract made and entered
into as of the day of September, 1975, by and between
the Brazos £lectr Power Cooperative, Inc. (hereinafter
called "Brazos"), a private corporation organized and existing
under the laws of the State of Texas and the Texas Power
Pool, Inc. (hereinafter called "Corporation" or "entity"), a
private corporation heretofore created and established under
the Constitution and laws of the State of Texas.
W I T N E S S E T H
WHEREAS, under the provisions of Article 1435a, V.A.T.C.S.,
entities engaged in the generation, transmission, or distribution
.of electric energy may join together as co-tenants or co-
owners in the planning, financing, acquisition, construction,
ownership, operation and maintenance of electric generating
units and plants, electric transmission lines and other
electric facilities; and may enter into agreements for the
planning, fina-.icing, acquisition, construction, ownership,
operation anO maintenance of jointly owned and operated
electric facilities; and
WHEREAS, acting pursuant to Section 4(a) of Article
1435a, V.A.T.C.S., the Texas Municipal Power Agency, the
Corporation and Brazos have executed a Preliminary Participation
Agreement pursuant to which the Corporation is to perform
certain duties and perform certain work on behalf of the
Participants; and
WHEREAS, this document is a part of the Preliminary
Participation Agreement since the same provides for payments
to be made to the Corporation by Brazos for work done and
performed by the Corporation under such agreement; therefore,
THE PARTIES HERETO, IN CONSIDERATION OF THEIR MUTUAL
AGREEMENTS AND UNDERTAKINGS, HEREBY CONTRACT AND FURTHER
AGREE AS FOLLOWS:
ARTICLE I
SECTION 1.01: Brazos and the Texas Municipal Power
Agency ave erete executed an instrument entitled, "Contract
.for Development of Fuel Resources and Planning Electric
Generating Facilities." The findings and representations of
Brazos as contained in Sections 1.01, 2.01 and 2.02 of that
part of the contract are reaffirmed and made a part of this
document by reference.
SECTION 1.02: The parties hereto recognize that the
contract mentioned in the preceding Section relates only to
the payment of the debt of the Agency; that the debt of the
Agency is payable only from the 'net revenues" of the Agency;
that is, after payment of the maintenance and operating
expenses of the Agency,
This contract shall remain in force and effect during
t' -
the time that the debt of the Agency is outstanding and then
continue in force for a period of ninety (90) days and until
three monthly payments (for which provision is made by
Section 2.02) have been made.
The parties recognize this document is a part of the
Preliminary Participation Agreement mentioned in the preamble
and is effective as a part of that document when executed by
the parties and approved by the Rural Electrification
Administration.
SECTION 1.03: As used in this instrument, the term
"debt-of he Agency" means the principal of, interest on, reserve
fund for and any applicable redemption premium with respect to the
initial series of bonds of the Agency known as "TEXAS
MUNICIPAL POWEk AGENCY REVENUE BONDS, SERIES 1975,"
dated September 15, 1975 to be authorized in a principal
amount of not to exceed 410,625,000. The term does not
include any bonds or other obligations issued for the purpose
of refunding, cancelling, and in lieu of such Series 1975
bonds.
ARTICLE II
SECTION 2.01: For and in consideration of the undertakings
of the orporat on, Brazos agrees it will me'.ce payments to
the Corporation of the following payments-.
.15 mills for each kilowatt hour of net energy for load
of Brazos during the fiscal year of the Agency. The
term "net energy for load" shall have the meaning set
forth on F.P.C. form, 12 E-1, page 5, Schedule I; i.e.,
the system net generation plus energy received from
others minus energy delivered to otters. The amount
due from Brazos shall be divided in to 12 approximately
equal monthly payments based upon the estimated net
energy for load of Brazos. Such estimate to be made as
follows: (1) on or before the first day of each fiscal
year, the chief engineer of Brazos shall file (with the
Executive Director of the Agency) a report containing
his estimate of the net energy for load for Brazos for the
following 24 month period and from such report the
arithmetic average of the particular year shall be
determined (such report may be amended by the chief
engineer of Brazos not more than twice in any one
fiscal year) and (2) the arithmetic average of net
energy for load of Brazos for the preceding fiscal year
of the Agency shall be calculated, and (3) if the
estimate of the said engineer is not timely filed the
average of net energy for load on the historical 12
month period shall be used until such estimate is
filed, but if the estimate is filed the higher of the
calculations obtained under (1) and (2) above shall be
used as the estimated net energy for load. Within 10
days of the close of a fiscal year, the Executive
Director of the Corporation shall redetermine the
amount which should have been paid in the preceding
fiscal year and the additional amount due shall be
billed to Brazos or credit shall be given to Brazos on
the billing which becomes due October 15. If the
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i
additional amount due from Brazos is more than 5% of
the amount paid by Brazos during the preceding year, an
amount equal to 10% of the amount cue shall be added to
the statement and shall be paid by it.
Such payments shall be made on or before the 15th day
of each month, commencing October 15, 1975, and the
Corporation covenants that money received under this
agreement will be used only for the purpose of paying
its maintenance and operating expenses and only for
items or expenses which have been included in a proper
budget or budget amendment (iucluding a temporary
budget).
The amount to be paid for each kilowatt hour of net
energy for load shall be subject to adjustment from time
to time in the following manner:
(1) It may be raised if the Corporation notifies
Brazos that the amount of income being received for the
payment of maintenance and operating expenses is not sufficient
for the purpose and that the amount being collected from
each entity contracting with the Corporation is being
increased proportionately; such notice shall show the basis
of the adjustment (increase) so as to proviO-i not less than
the amount budgeted for such expenses during the then fiscal
year and not more than 110% of such budgeted amount. No
raise in the amount due from an entity shall be effective
until such entity has received 30 days notice of the revision,
but Brazos may delay paying the increased amount until sixty
(60) days after the receipt of such notice of revision
provided (i) it notifies the Corporation of its intention so
to do and (ii) pays the amount due from the effective date
of the increase on such sixtieth day.
(2) it shall be decreased if the amount received by
the Corporation for the payment of the maintenance and
operating expenses exceeds125% of the amount shown in the
budget therefor (for the then current fiscal year) and the
millage rate will be reduced so as to provide not less than
the amount budgeted for such expenses during the then current
fiscal year and not more than 110% of such budgeted amount.
Any surplus (an amount in excess of 110% of the amount
budgeted for such expenses) shall be either:
(a) applied as a deduction from the amount due from
Brazos during the next succeeding month or months, or
(b) maintained as working capital by the Corporation,
as directed by the entities who provided the funds, In the
absence of a direction being received from Brazos, money
supplied by Brazos shall be applied as a deduction from the
amount due from Brazos. Any surplus which is'in excess of
1M of the amount shown in the budget for maintenance and
operating expenses shall be returned to the entities who
supplied the funds. The credits or repayment of funds shall
- -3-
• p
be given or made in the same proportion as the funds were
originally paid for such expenses.
It shall be the duty of the Executive Director of the
Corporation to make the calculations with respect to the
rate per mill to be collected for each kilowatt hour of net
energy for load.
SECTION 2.02: Should Brazos fail to make any payment
at the tTms min specified, interest on such amounts
shall accrue at the rate of ten per centum (10%) per annum
from the date such payment becomes due until paid in full
with interest as herein specified. In the event such
payment becomes due, the Corporation may institute a proceeding
for a mandamus or mandatory injunction requiring the payment
of the amount due and interest thereon, such action to be
instituted in a court of competent jurisdiction.
SECTION 2.03: The payments required to be made by
Brazos un the terms of this contract shall be due and
payable as herein specified, and Brazos shall have no right
of setoff, recoupment or counterclaim against such payment.
SECTION 2.04: (a) Brazos represents and covenants
that ot` Fe- than those payments made from other funds legally
available and reasonably assured for the purpose, all payments
to be made by it hereunder shall constitute "operating
expenses" of its electric system.
(b) Brazos further agrees to fix and collect such
rates and charges for utility services to its customers as
will, in combination wick any other funds legally available
and reasonably assured for the purpose, make possible the
prompt payment of all expenses of operating and maintaining
its utility system and all payments contracted hereunder.
SECTION 2.05: The Corporation may not pledge all or
any part or the payments to be received from Brazos under
this agreement, but this provision shall not be construed as
prohibiting the Corporation's pledge of such payments (or
part thereof) to the payment of a temporary bank loan made
to the Corporation:
(i) for the purpose of paying maintenance and operating
expenses of the Corporation, and
(ii) where the pr{ncipal of and interest on the temporary
bank loan is due and payable:
(a) within 12 months, and
(b) does not exceed that amount scheduled to be
paid by Brazos while the loan is unpaid.
t;
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.4.
s,
ARTICLE III
SECTION 3.01: Subject to the provision of Section 8.14
~,i theereIimi an y Participation Agreement, this contract
may be changed and modified only with the consent of the
governing bodies of the Corporation and Brazos. Such modification
may ba requested by either of the parties, in which event a
Joint meeting of the governing bodies or of their duly
authorized and appointed representatives shall be held not
less than fifteen (15) days after the giving of such notice.
At such joint meeting the suggested changes or modifications
shall be considered, discussed and settled. No such change
or modification may be made which will affect adversely the
payment when due of all monies required to be oald by Brazos
under the terms of this contract and no such change will be
effective which affects adversely or causes a violation of
any covenants contained in the resolution or order authorizing
the issuance of the Agency's bonds.
SECTION 3.02: Any notice, request, c'emand, statement
or bi provi33-for in this agreement shall be in rn iting
and shall be considered to have been duly delivered when
sent by registered mail, addressed as fOllo4,s:
Corporation: TEXAS POWER POOL, INC.
Forest Park Center
7111 Bosque Blvd.
Waco, Texas 76710
Attention: Executive Director
Brazos: BRAZOS ELECTRIC POWER COOPERATIVE, INC.
2404 La Salle Avenue
Waco, Texas 76701
Attention: Executive Vici Pres. and
Gen. Manager
as the case may be, except that routine communications may
be sent by ordinary mail and except that either party, by
the filing of an appropriate written notice to the others,
"y specify some other individual to whom communications
thereafter are to be addressed.
SECTION 3.03: The Corporation covenants that it will
enforce tfFie oUrgat£ons of Brazos hereunder (as well as sny
obligations contained in similar contracts with additional
contracting party) as may be required to accomplish the
purpose of this contract. Either party may enforce any
obligations hereunder owed by it by the other party.
;;ECTION 3.04: The parties hereto agree that if any of
the pro-v s one this contract.contravene or be held invalid
under the laws of this State, same,shall not invalidate the
whole Agreement but it shall be construed as though not
containing that particular provision and the rights and
obligations of the parties shall be construed and in force
accordingly.
FL
IN WITNESS WHEREOF, the parties hereto, acting under
authority of their respective governing bodies, have caused
this contract to be duly executed in several counterparts,
each of which shall constitute an original, all as of the
day and year first above written.
BRAZOS ELECTRIC POWER COOPERATIVE, INC. TEXAS POWER POOL, INC.
By BY
President, oai'T-o rectors President, oar o
Directors
ATTEST : ATTEST:
ecretary, Boar o Directors Secretary, ar o_
Directors
(Seal) (Seal)
THE STATE OF TEXAS 3
COUNTY OF S
BEFORE: ME, the undersigned authority, in and for the said
County on this day personally appeared
President of the Board of Directors of t e razos Electric ower
Cooperative, Inc, known to me to be the person whose name is
subscribed to the foregoing instrument and known to me to
be the President of the Board of Directors of the Brazos
Electric Power Cooperative, Inc. and acknowledged to me that
he executed the same for the purposes and considera0.on therein
expressed and in the capacity therein stated as the act and
deed of said Corporation,
GIVEN UNDER MY HAND AND SEAL OF OFFICE this the day
of 1975,
Notary Public
County, Texas
(Notary Seal)
BEFORE HE, the undersigned authority, in and for the said
County on this day personally appeared
President of the Board of Directors of the Texas ower Pool,
Inc., known to me to be the person whose name is subscribed
to the foregoing instrument and known to me to be the President
of the Board of Directors of Taxas Power Pool, Inc. and
acknowledged to me that he executed the same for the purpose
and consideration therein expressed r,t.d in the capacity therein
stated as the act and deed of said T.^xaa Power Pool, Inc,
GIVEN UNDER MY HAND ANL SEAL OF OFFICE this the day
of 1975.
,
otary Public
County, Texas
(Notary Seal) -6-
Draft No.
9-18-75
PRELIMINARY IARTICIPATION AGREEMENT
1. PARTIES: The parties to this agreement are; Texas
MunicipTIower Agency (hereinafter called "Agency"), the
Brazos Electric Power Cooperative, Inc. (hereinafter called
"Brazos"), and the Texas Power Pool, Inc. (hereinafter
called the "Corporation").
2. RECITALS: The Agency and Brazos, believing that electric
generaL2-'on and transmission facilities jointly constructed,
acquired and owned by them and operated for their benefit
will (1) produce substantial economies by reason of economy
of scale, and (2) lessen the environment impact, desire to
enter into this Preliminary Participation Agreement for pre-
liminary planning and investigation of the projects (as
herein set forth) in order for such parties to make a final
determination that the economies of joint action warrant
such cooperative endeavors and such parties have determined
that the construction of some transmission facilities and
the acquisition of a fuel oil terminal would be advantageous
as initial projects.
The Agency and Brazos recognize that the implementation
of a part of their understanding with each other can he
accomplished by their designation of a third party, he
Corporation, as the instrumentality through which some of
the administrative matters (as distinguished from policy
matters) may be best accomplished.
3. AGREEMENT: The parties recognize that the Agency must
comply wit t e provisions of the Internal Revenue Code in
order that the interest on the bonds issued by it will be
exempt from Federal Income taxes (not industrial development
bonds) and that Brazos must comply with the applicable rules
and regulations of Rural Electrification Administration. No
provisions of this or any subsequent contract shall be
construed as requiring any action to be taken by any party
which would cause such party to be in contravention of any
applicable laws, rules or regulations with which such
party must comply. In consideration of the mutual covenants
herein, the parties agree as follows:
4. DEFINITIONS: The following terms, when used herein,
shall have meanings specified:
Agency - the Texas Municipal Power Agency heretofore
created (by concurrent ordinances of the Cities)
as a municipal corporaticn and a political sub-
aivision of the State of Texas.
Brazos - The Brazos Electric Power Cooperative, Inc.,
a non-profit corporation organized and existing
under Article 1528a, V.A.T.C.S.
eitios -*The incorporated municipalities (each being
a home rule city) which created the Texas Municipal
Power Agency; i.e., the City of Bryan, the City of
Denton, the City of Garland, the City of Greenville,
each being located wholly within the State of Texas.
construction work - All environmental impact studies,
site evaluation, acquisition of the project,
engineering, design, construction, contract prepara-
tion, supervision, expediting, inspection, and
acquisition of land and rights-of-way for a
project.
corstruction work liability - Liah.'.lity of one of the
parties hereto for daoage suffered by anyone other
than a party to this Agrenmcmt which arises out of
-1-
construction work and is not discharged by
project insurance, and is not the result of willful
action,
Corporation the Texas Power Pool, Inc,, a non-profit
corporation heretofore created under the Constitution
and laws of the State of Texas. The corporation
is not a participant.
ecouamic dispatch - The allocation of the total genera-
tion required of the pool to alternate available
sources in order to achieve the best possible
pool economy consistent with safe, effective oper-
ation. I'Factors to be considered in determining
the best possible economies include lire losses,
generator efficiencies, fuel costs, lo&d limits of
generators, transmission line load limits, purchase
power costs, and fuel, generation, and purchased
power contractual obligations.)
engineering studies - Those studies which the Cities have
requested the Agency to obtain (which are further
identified in Section 6.3 hereof); which Brazos
also wishes to obtain (and which the Agency and Brazos
direct be performed in Section 6,3 hereof).
FPC Accounts - The accounts prescribed by the Federal
Power Commissi.,*i's "Uniform System of Accounts
PresQribed for Public Utilities and Licensees
(Class A and Class B)" in effect as of the date hereof,
as such system of accounts may be amended from time
to time as maintained in accordance with generally
accepted accounting principles.
.isolated points - a location at which power and energy
from a transmission or distribution system of one
entity is delivered as purchased power at the
distribution system of another entity, or to one
of its members, subsidiaries or customers.
land - real estate or interest therein (including the
right to mine, mineral interests or options to
purchase).
ownership interest - The percentage interest cf the parti-
cipants in the project. Each participant's per-
centage interest shall be equal to such participant's
ownership in the project at the applicable time
as contemplated by this Participation Agreement.
participant - A party hereto or other entity acquiring
an interest in the project in accordance with
this Participation Agreement.
project - (1) The acquisition of fuel resources which an
engineer determines would be suitable for use in
an electric generating unit, including all
preliminary or development expenses such as
drilling, 1o ging, surveying, testing, analysis,
the acquisition of land, minerals or any interest
therein, negotiations and all other expenses found
to be necessary or proper in the determination of
-2~
whether the fossil fuel then under consideration
is commercially mineable in quantity and quality
and the acquisition of such fuel resources found
so to be; and (2) the engineering studies; and
(3) the construction of interconnection facilities;
the engine~_-r4.ng studies and preliminary construction
expense (including right-of-way acquisition) for
the construction of the Olinger-Greenville
transmission line; communication facilities;
and (4) the acquisiton of storage facilites for
fuel oil (as an emergency fuel supply).
project agreements - This Participation Agreement, any
construction agreements and such other agreements
relating to the project, as the participants find
necessary or desirable to designate as project agree-
ments, as each of such agreements is originally
executed or as any of same may thereafter be supplemented
or amended.
project insurance - Policies of insurance to be procured
and maintained in accordance with Section 14 hereof.
project manager - The Participant or agent responsible
for the planifing, construction and operation of any
project or a part thereof in accordance with this
Participation Agreement and the project agreements.
Under this Agreement, the project manager for the
project shall be the Corporation or its assigned Agent.
station work - Operation, maintenance, use or repair of
the project (that part of the project described in
paragraphs (3) and (4) of the definition of such
term) subsequent to the time of the operation thereof,
including, though not by limitation,'all related
engineering, contrazt preparation, purchasing,
supervision, expediting, inspection, accounting,
testing, management and protection.
station work liability - Liability of one or more of the
parties hereto f,3r damage suffered by anyone other than
one of such parties which arises out of station work,
and is not discharged by project insurance, and is
not the result of willful action.
units of property - Units of property as described in the
Federal Power Commission's "List of Units of Property
for Uee in Connection with Uniform System of Accounts
prescribed for Public Utilities and Licensees" in
effect from time to time.
willful action - (A) Action taken or not taken by one of
the parties heret•7 at the direction of its governing
body or board, which action is knowingly or intention-
Ally taken or not taken with intent to cause injury
cr damage to anotlar.
(B) Action taken ur not taken by an employee of one
of the parties hereto, which action is intentionally
taken or not taken with intent to cause it►jury or
damage to another and which action or non-action
' -3-
is subsequently ratified by one of the parties hereto
employing such employee at the direction of its said
governing body or board.
(C) Willful action does not include intentional acts
or omissions of one of the parties hereto for which
one of the parties hereto is legally responsible
solely because of the master-servant relationship
between such pr--ty and its employees.
5. OVNERSHIP OF PROJECT:
5.1: The agency and Brazos shall acquire and, subject
to adjustments as provided herein, shall initially own an
undivided interest in the project as a tenant in common with
the other participant. Each party's respective undivided
interest being in the following percentages:
the Agency: 97%
Bravos: 3%
At the end of each fiscal year of the Agency, an audit
shall be made of the expenditures and payments to the Corpora-
tion c,r each other (in connection with the project) that
have becl made by the Agency and Brazos. Such audit shall
be made by an independent certified public accountant approved
.(prior to employmert) by the Agency and Brazos. Within 30
.days after completion of the audit, Brazos shall pay to the
Agency or the Agency shall pay to Brazos, any amount (plus
interest at the saroe effective rate of interest borne by
debt of the Agency) which the accountant finds is proper to
be paid so that the ownership in the project remains as set
forth herein. In the event the full amount due from one
tarty to the other is not paid (including interest thereon)
within such 30 day period, then the same shall be treated as
a transfer of a part of a party's interest in the project
under Sections 12.7 through 12.9 without the nec,ssity of
compliance with Sections 12.1 through 12.6. For purposes of
this Section, the end of the first fiscal year of the Agency
shall be the first fiscal year that contains at least 12
months.
5.2: During the time the debt of the Agency (defined
in Section 8.12) is outstanding and for a period of 24
consecutive months thereafter, Brazos may purchase and
acqui-:e from the Agency, and the Agency may sell and assign
to Brazos, additional total undivided ownership interest in
the project as a tenant in common so that the total undivided
interest of Brazos is equal to not sore than 40%. It shall
be the duty of the Agency to apply moneys it receives from
such sale in the proper manner so the bonds issued by the
Agency will not be classed as "arbitrage bonds" so as to
make interest on such bonds subject to taxation in the hands
of the holder..
Brazos shall give the Agency 90 days notice of its
intent to exercise suet option, which notice shall specify
the percentage cf ownership which Brazos then proposes to
acquire. Upon the giving and receipt of such notice:
(A) The parties shall proceed in good faith and with
due diligence to obtain all required authorizations and
approvals of such acquisition.
(B) The Agency shall obtain the release of any lien
encumbering the ownership interest which is the subject
of the transfer at the earliest practicable date.
(C) Brazos shall perform all of the terms and conditions
required of it to complete the acquisition of said
ownership interest.
The acquisition of the ownership interest by the
participant having elected to acquire the same shall be
fully consummated within seven (7) months following the date
upon which all notices required to be given under this
Article have been duly served.
The Agency represents and warrants that the execution
of this contract, including the granting of the option
herein provided has been approved by a weighted majority of
the Agency's Board as contemplated by the Rules and Regulations
of the Agency.
Only Pn undivided interest in the entire project may be
acquired, ')ut the instruments of conveyance may make provision
for only a portion of such interest to be subjected to liens
,of the Rural Electrification Administration if so required
by such Administration.
5.3: The option price to be paid by Brazos shall be
calculated as follows:
(a) the cost of the project shall be determined to the
date of the payment of the option price.
(b) the cost of the project (as so determined) shall
be multiplied by the percentage of ownership to be acquired
by Brazos (as specified in the notice of exercise of the
option).
(c) Brazos shall receive credit for principal payments
made by Brazos on the debt of the Agency as well as a propor-
tionate share of payments evade to the reserve fund created
for the security and Tayment of the debt of the Agency. The
extent to -which sis,:h credits shall be available is set forth
in Exhibit A hereto, which exhibit illustrates the manner in
which such credits shall be computed.
Unless otherwise agreed by the parties, the cost of the
project shall be determined by a certified public accountant
selected by the parties.
5.4: Upon payment of the option price in cash, Brazos
shall receive title to and shall own the interest as a
tenant: in common, subject to the same rights, duties and
obligations as are applied by this Agreem,nt and any other
existing agreements to the interest being transferred in the
hands of the transferring participant.
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I'
6. PROJECT MANAGER:
6.1: Each participant hereby appoints the project
manager as its agent, and the project manager shall undertake
as agent for the participants the responsibility for (1) the
performance and completion of the station work required by
this Participation Agreement, and (2) the completion of the
studies required hereunder, and (3) fuel development as
contemplated by this Agreement. The Corporation agrees to
assume the responsibilities imposed upon it by this Agreement.
6.2: Subject to this Participation Agreement, the
project manager shall:
(A) Provide for and obtain all studies (including
environmental impact studies and preliminary safety
analyses), permits and licenses necessary for the
construction and operation of the station work and
utilization of fuel obtained under the fuel development
program herein contemplated.
(B) Acquire the right-of-way or plant site for the
station work in accordance with the parameters set
forth in Section 19 hereof, and fuel supplies, such
acquisition to be for the initial oenefit, and at the
cost, of the participants in the proportions set forth
in Section S.
(C) Supply the participants with copies of all studies
made, license and permit applications filed and licenses
.and permits obtained.
(D) Obtain bids and negotiate proposals for the work
to be done and studies completed which are necessary
for the performance and completion of the project.
(E) Obtain bids and negotiate proposals from contractors
for the performance and completion of each compone-it of
construction work.
(F) Furnish participants with duplicate original
copies of all contracts with the contractors, subcontractors
and vendors.
(G) Arrange for the placement of project insurance
pursuant to Section 14 hereof.
(H) Investigate, adjust, and settle claims arising out
of or attrLbutable to construction work or station
work, including but not limited to any claim resulting
froca death or injury to persons or damage to property
for which payment shall not.be made on account of valid
and collectible project insurance or other valid and
collectible insurance, and present and prosecute claims
against any insurer or other party for losses and
damages in connection with construction work or station
work. The terms of this Section shall not include
-b-
claims involving willful action by the project manager.
The authorization from the Agency and Brazos shall be
obtained by the project manager before any claim or
combination of claims arising out of the same transaction
or incident is settled for more than One Thousand
Dollars, or the amount of any project insurance deductible,
whichever may be greater.
(I) Assist any insurer in the investigation, adjustment
and settlement of any loss or claim.
(J) Administer and enforce contracts in the name of
the project manager as agent for the participants.
(K) Comply or require compliance with (i) any and'all
laws and regulations applicable to the performance.of
construction work or station work, and (ii) the terms
and conditions of any contract- relating to construction
work or station work.
(L) Expend the funds advanced to the project manager
in accordance with the terms and conditions of this
Participation Agreement.
(M) Keep and maintain records of monies received and
expended, obligations incurred, credits accrued, estimates
of construction costs (excluding ad valorem taxes and
interest during construction) and contracts entered
into in the performance of construction work, and make
such records available for inspection by the participant
at reasonable times and places.
(N) Not suffer any liens in connection with construction
work or station work to remain in effect unsatisfied
against the project (other than liens permitted under
the project agreements, liens for taxes and assessments
not yet delinquent, 'icn:, for workmen's compensation
awards, and liens for labor and material not yet per-
fected); provider,, however, that the project manager
shall not be rer.uirpd to pay or discharge any such lien
as long as the project manager in good faith shall be
contesting the same which shall operate during the
pendency thereof to prevent 0±,5- collection or enforce-
cent of such lien so cont,toted.
(0) Provide each participant with all neces:.ary and
required records and information pertaining to the
performance of construction work, including a monthly
progress report.
(P) Keep each participant fully and promptly informed
of any known default under the provisions of this
Participation Agreement.
(Q) As soon as practicable after the commencement of
construction work, furnish each participant with a
detailed forecast of total construction costs. Said
forecast shall be revised and furnished to each parti-
cipant every three (3) months thereafter until completion
of construction work, provided, that any significant
changes in said forecast shall be submitted to each
participant as soon as practicable after such changes
become evident. In addition, and as soon as practi-
cable after commencement of construction work, furnish
each participant a detailed monthly forecast of each
participant's estimated expenditures for the succeeding
month for construction work, which said forecast shall
be furnished each participant monthly thereafter until
completion of construction work.
(R) Furnish each participant any information reroot:ably
available pertaining to construction work that will
assist said participant in r4.sponding to a request for
such information by any fedf:ral, state or local au~:hority.
(S) Use its best efforts i1 the performance of its
responsibilities hereunder ;-o effect the completion of
construction wo.k.
(T) Keep each participant fully and -)romptly advised
of the major developments ?.n connection with the performance
and completion of construction work.
(U) Conduct tests to verify that specified charac-
teristics of equipment items have been achieved and, if
necessary, make or arrange for final equipment modi-
fications to meet the specified requirenents thereof.
(V) Obtain and enforce any and all customary warranties
on equipment, facilities, and materials furnished for
the project.
(W) Perform or cause to be performed the station work
in accordance with generally accepted practices in the
electric utility industry as such practices may be
affected by the design and operational characteristics
of sues facilities.
(X) Execute, 3rforce, and comply with all contracts
entered into under this Agreement.
(Y'# Purchase and procure the equipment, apparatus,
machinery, tools, materials and supplies and spare
parts necessary for the performance of station work;
however, the project manager shall obtain approval from
the Agency and Brazos for any purchase costing mcrc
than $20,000,
(Z) Keep and maintain records of monies received ,nd
-8.
expended, obligations incurred, credits accrued, and
contracts entered into in connection with the performance
of station work and make such records available for
inspection by the participants at reasonable times and
places.
(AA) Keep each participant fully and promptly advised
of major changes in conditions or other major develop-
ments which affect the performance of station work, and
furnish each participant with copies of any notices
given or received pursuant to the project agreements.
(BB) Upon the request of any participant, provide such
participant a copy of any report, record, list, budget.
manual, accounting or billing summary, classification
of accounts or other documents or revisions of any of
the aforesaid items, all as prepared in accordance with
this Participation Agreement.
(CC) Establish, periodically review and from time to
time, revise and submit to Brazos and the Agency for
review and approval the following information:
Safety procedures for the protection of personnel,
for removing equipment and systems, including clearance
procedures for removing equipment from service for
inspection, test and maintenance.
(DD) Administer and enforce all project agreements with
third parties relating to station wo:'k.
(EE) Maintain plant charts and operating records on
joint project as may be required for reporting to
regulatory agencies having jurisdiction..
SECTION 6.3; The work to be done by the Corporation,
either tHrougFTts own representatives or authorized agents
of under contract with others, by virtue of this contract is
as follows:
(a) Fuel development:
Bryan lignite:
drilling, logging, coring, surveying,
testing and analysis to accurately
determine the quality and quantity of
the lignite deposits; acquisition of
land or interest therein.
The Corporation shall retain such geolo ist
or fuel consulting firm (either or both
as in its judgment is required to make
appropriate determinations (based on
such drilling, logs, corings, surveys
and analysis) as to whether such lignite
deposits are of commercially mineable
quality and quantity. The Corporation shall
utilize bond proceeds only for the
acquisition of land or interest therein
as meet the criteria established by
such geologist or consultants.
The estimated budget submitted by the
Agency and Brazos as guidelines for such
proposed operation being as follows:
-9-
Estimated "Short Term Item Estimated Cost
Paul 'weir Studies $ 226,500
Aerial Surveying 95,000
Drilling and geological analyses 184,000
Land men 95,000
Lease options 40,000
Leases of land 50,000
Purchase options 25,000
Purchases of land 3,600,000
Lease conversion bonus 105,000
Geologist lease conversion fes 150,000
Preliminary engineering studies 100,000
Environmental and air quality studies 150,000
Legal evaluation of deed, titles 50,000
Testing of cores, samples 35,000
Miscellaneous 100,000
$5,571,500
Other lignite:
drilling on exploratory basis and pre-
liminary leasing (under terms and conditions
similar to rh,se set forth with respect to Bryan
lignite) $ 150,000
Western coal:
negotiations and minor development expenses
in order to determine availability of
coal as a fuel supply..
$ 25,000
(b) Engineering Studies:
Combustion turbines
Evaluation of alternates
simple cycle combustion turbines
regenerative cycle combustion turbines
combined cycle generation
combustion turbines connected to
supply waste heat to older existing
units
negotiation of firm power purchase
contracts with other suppliers of
elec*_::iu energy.
Preparatir,n of feasibility study for financing
$ 50,000
Economic Dispatch:
Tests on performance of generating units of
the cities of Bryan, Denton, Garland, Greenville
and the Brazos Electric Power Cooperative. Inc.;
study of existing power pools; studies in
engineering accounting, computer analysis
on accountirg criteria; operating guidelines
and personnel.
4
107,000
~r
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Comanche Peak Nuclear Plant:
Engineering study on feasibility of 10%
participation in the plant.
$ 50,000
Village Bend Pumped Storage:
Project investigation under application hereto-
fore approved by the Federal Power Commission,
Phases lA and 1B only (the work prior to
Project Evaludtion Report).
$ 125,000
Microwave Communications System:
Path and site location studies and contruction
of the facilities.
$ 550,000
Transmission Planning Studies:
Evaluation of alternate transmission plans.
$ 40,000
Texas Interconnected System Studies:
Gathering of data on load flow, short circuit,
power transfer, stability, etc.
$ 5,000
Fuel Studies:
Development of a fuel management study,
(quantities consumed, usage patterns etc.)
by computer analysis.
$ 10,000
Cost of Service Studies:
A detailed study of all costs involved in
the generation and transmission of capacity
aiud energy.
$ 4,000
(c) Construction:
Interconnection with private utilities.
$1,084,000
Olinger-Creenville Transmission line -
additional connection of Greetnville and Garland
for ewergency power: engineering and pre-
liiuitnary construcliun expense.
$1,000,000
(d) Acquisition of storage facilities for oil (emergeney
fuel supply).
t 1,so,ooo
• . -11-
6.4: The amounts hereinabove set forth are those which
the Agency and Brazos feel are proper amounts for the purposes
set forth; that the amounts shown are the approximate anticipated
expenditures through June, 1976.
6.5: It shall be the duty of the Corporation to amplify
a project budget of proposed capital expenditures (for the
purposes mentioned in Section 6.3) as may be required by it
so as to insure the foregoing project is accomplished, and
the transfers of money from one item to another may be made
by the Corporation, but no more than 25% of the amount
budgeted for one budget item in excess of $50,000 nor more
than 50% of the amount budgeted for one item of $50,000 or
less, may be transferred to one or more other items without
approval of such transfer by the weighted majority of the
Agency's Board as contemplated by the Rules and Regulations
of the Agency and the governing body of Brazos.
6.6: Any study made, including all preliminary and
final reports, as a result of this contract shall be made
available to Brazos and the, Agency. Any facilities constructed
or acquired pursuant to this contract during their useful
life, shall be the property of the participants but shall be
available for use by them, subject to a charge for maintenance
and operating expenses (based upon the percent of the capacity
used) of such facility while being so utilized.
Any interest in lased or fuel obtained as a result of
expenditures made pursuant to this contract shall be and
remain the property of the participants, and fuel shall be
made available for use in the generation of electric energy
as contemplated by the remainder of this Section.
The parties hereto recognize that the purpose of this
agreement is to provide for certain preliminary expenses of
the participants with the view that the participants will be
in position to acquire and construct (and provide fuel for)
additional electric generation facilities so as to provide
electric energy to the participants.
For and in consideration of the agreements of Brazos
and the cities contained in the contracts being simultaneously
executed, the Agency has and does hereby agree to deliver to
Brazos and the cities energy produced by the electric generating
facilities that the Agency may hereafter acquire, utilizing
the fuel acquired under the provisions hereof, subject to
the limitations of this Section.
The amount of electric energy made available to each of
the participants at the bus bar of the generating facilities
shall be proportionate to their ownership interest.
In the event the participants do not acquire a generating
facility capable of utilizing the fuel acquired hereunder,
the participants, upon the sale-of such fuel, shall credit
the participants with the proportionate share of the receipts
from such sale (based upon their ownership interest).
. -12-
♦ J
1 7. CONSTRUCTION COSTS:
7.1: Construction costs shall consist of payments made
and obligations incurred (other than obligations for interest
during construction) for the account of construction work
and shall consist of, but not be limited to, the following:
(A) All costs of labor, services and studies performed
in connection with construction work, if authorized and
approved as provided herein.
(B) Payroll and other expenses of the project manager's
employees while performing construction work, including j
properly allocated labor loading charges, such as j
department overhead, time-off allowances, payroll
taxes, workmen's benefits and employee benefits,
(C) All components of construction costs, including
overhead costs associated with construction (excluding
any allowance for the project manager's administrative
and general expenses), costs of temporary facilities,
land and land rights, structures and improvements, and
equipment for the station work, in accordance with FPC
Accounts.
(D) All costs and expenses, including those of outside
consultants and attorneys, incurred by the project
manager for construction and operating certificates,
licenses and permits, and with respect to environmental
laws, rules and regulations, to land and water rights,
to fuel requirements and supply and the acquisition
thereof, and to the preparation of agreements relating
to construction work with entities other than the
participants or the Cities.
(E) Applicable costs of materials, supplies, tools,
machinery, equipment, apparatus, initial spare parts,
construction power and construction water in connection
with construction work, including rental charges.
(F) All costs of construction insurance, all costs of
any loss, damage or liability arising out of or caused
by construction work which are not satisfied under the
coverage of construction insurance, and the expenses
incurred in settlement of injury and damage claims,
including the costs of labor and related supplies and
expenses incurred in injury and damage activities (all
as referred to in FPC Account 925), because of any
claim arising out of or attributable to the construction
of station work, or the past or future performance or
nonperformance of construction work, including but not
limited to any claim resulting from death or injury to
.persons or damage to property.
-13-
(G) All federal, state or local taxes of any character
imposed upon construction work, except any tax assessed
directly against an individual participant unless such
tax was assessed to such individual participant on
behalf of both participants.
(N) All costs and expenses of enforcing or attempting
to enforce the provisions of construction insurance
policies, payment and performance bonds, and warranties
extending to project facilities.
7.2: In cases where the allocation of a cost item is
made between construction work and any other work, such
allocation shall be made on a fair and equitable basis in
accordance with established accounting procedures.
7.3: The project manager shall use the FPC Accounts to
account for construction costs in the final completion
report and any supplement thereto.
8. ADVANCES AND PAYMENTS TO PROJECT MANAGER; COVENANTS OF
PARTICIPANTS:
he participants shall, during the course of and
until the final completion of construction work, advance to
the project manager such funds as shall enable him to pay
construction costs estimated to become due within 30 days.
During the course of construction work, each participant
shall advance funds to the construction account to cover
estimated construction costs in proportion to its percentage
of ownership in the project.
8.2: During the course of the development of fuel
resources and during the time engineering studies are being
made, the participants shall advance to the project manager
such funds as shall then be required to be disbursed within
the ensuing 30 days (as shown on the budget for the proposed
expenditures) and such advances shall be made by the parti-
cipants in proportion to its percentage of ownership of the
project.
8.3: Funds shall be advanced by the participants to the
project manager in response to a request for finds within
five (5) working days after receipt by such participant of
the request for funds. Funds on hand will be invested to
the maximum extent possible. Net earnings or losses will be
allocated to the participants on the basis of funds ad-
vanced. Funds shall be requested as near to the date such
funds are required by the project manager as is practical
under the circumstances.
8.4: The sum of the advances by the participants hereunder
shall not exceed 100 per:ent of the total project costs
estimated to be expended during the period specified in the
request for funds.
8.5: Funds not advanced to the prcject manager on or
before the due date specified in Section 8.3 hereof shall be
payable with interest at the rate of 10% per annum.
8.6t If a participant shall dispute any portion of any
amount specified in a request for funds, the disputant shall
make the total payment specified in the request for funds
under protest as provided in Section 16.4 hereof.
8.7: When the total and final project costs have been
incurred and calculated, each participant shall pay any
deficit between total advances made by it and its share of
-14-
said total and final project costs or shall be reimbursed
for any credit between said total advances made by it and
its share of said total and final project costs by the other
participant.
8.8: In order to accomplish the purpose and intent of
the parties as expressed herein, the Agency agrees and
covenants with Brazos that to the extent it may legally do
so:
(a) The Agency will not hereafter make any expenditure
of funds for the purpose of constructing or acquiring additional
electric generating capabilities unless:
(1) it has obtained the approval of the same as a
joint project from the governing bodies of Brazos,
and the Corporation, o:
(2) the governing bodies of either Brazos or the
Corporation fail to approve the same as a joint
project for a period of 90 days after written
notice is given to them by Brazos
that the Agency wishes to proceed with the project.
(b) The Agency will not hereafter make any expenditure
for the purpose of constructing or acquiring additional
transmission facilities which will interconnect with any of
the facilities of the Cities or any joint projects which are
primarily for transmitting power to Brazos or the Cities
unless:
(1) it has obtained the approval of the same as
a joint project from the governing bodies of
Brazos, and the Corporation, or
(2) the governing bodies of either Brazos or the
Corporation fail to approve the same as a joint
project for a period of 90 days after written
notice is given to them by Brazos
that the Agency wishes to proceed with the project.
(c) The Agency will not make any expenditure for the
acquisition of a fuel supply (other than natural gas, oil,
diesel) for its electric generating facilities unless:
(1) it has obtained the approval of the same as
a joint project from the governing bodies of
Brazos, and the Corporation or
(2) the governing bodies of either Brazos or the
Corporation fail to approve the same as a joint
project for a period of 90 days after written
notice is given to them by the Agency or the
Corporation that the Agency wishes to proceed with
the project.
(d) The Agency will not hereafter enter a contract for
the purc:ase by it of capacity or energy to meet load plus
reserves with any entity other than Brazos or the cities
unless:
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M-
(1) it has first offered in writing for a period
of ten consecutive days to purchase such capacity
or energy from Brazos or from one of the cities
(under the same terms and conditions) and such
offer has not been accepted in wr?:inp,or
(2) Brazos or the cit4.es notify the Agency in
writing, that no capacity or energy is available
in the quantity (under the same terms and con-
ditions) and for the period of time requested by
the Agency.
The provisions of this paragraph (d) have no application
to the purchase of capacity or energy (i) on an emergency or
,stand-by basis, or (ii) under a contract having a duration
of less than two years (including any renewals thereof)-or
(iii) for power or energy incident to the construction and
testing of any facilities constructed by the Agency or its
agents, or (iv) on the basis of economic dispatch between
the Cities, the Corporation, the Agency and Brazos, any or
all.
(e) The Agency will not hereafter enter a contract for
the sale by it of capacity or energy to an entity other than
those who have an ownership interest with the Agency in
electric generating facilities, and even then not unless:
(1) it has first offered in writing for a period
of ten consecutive days to sell such capacity or
energy to Brazos or to one of the cities (under
the same terms and conditions) and such offer has
not been accepted in writing, or
(2) Brazos or the Corporation notify the Agency,
in writing, that no capacity or energy is required
in the quantity (under the same terms and con-
ditions) and for the period of time offered by the
Agency.
The provisions of this paragraph (e) have no application
to the sale of capacity or energy (i) on an emergency or
stand-by basis or (ii) on a contract having a duration of
less than two years (including any renewals thereof) or
(iii) for purchase of power incident to the cone*_ruc tion and
testing of any facilities constructed by the Agency or (iv)
the basis of economic dispatch between the Cities, the
Corporation, the Agency and Brazos, any or all, or (v) to
customers who are not Class 1 utilities (under F.P.C. guidelines)
except at isolated points.
The purpose and intent of paragraph (e) is to prevent
the sale of surplus electric energy or capacity by the
Agency to others than Brazos if such energy or capacity (1)
is required to meet the needs of Brazos or the cities and
(2) may be made available to Brazos or the cities. The
Agency recognizes the statute providing for its creation
restricts the manner in which it may sell or dispose of
electric energy as hereinabove set forth and covenants it
will comply with such law and that it will not, during the
term of this Agreement, sell or dispose of electric energy
-16-
s
to Brazos, any other electric cooperative, or others who (1)
are not member cities of the Agency or (2) who are not named
parties to this Agreement and who do not, at the time of the
delivery of electric energy, have an ownership interest in
electric generating facilities with the Agency.
8.9: In order to accomplish the purpose and intent of
the parties as expressed herein, and recognizing the limitation
imposed upon Brazos by the constraints of the laws, rules
and regulations applicable to it (as mentioned in Section
3), Brazos agrees and covenants with the Agency that to the
extent it may legally do so:
(a) Brazos will not hereafter make any expenditure of
funds for the purpose of constructing or acquiring additional
electric generating capabilities (including improvements to
or extensions of existing generating facilities which increase
the rated capacity of such existing facilities by more than
10% in any two year period) other than those generating
facilities under contract for construction or under construction
on the date of this agreement and other than the G and T
project (Atascosa-McMullen lignite units 1 and 2) and other
than improvements (not additions to the plant) which have
I the result of increasing the rated capacity of the generating
facilities to such an extent within such periods unless:
(1) it has obtained the approval of the same as a
joint project from the governing bodies of the
Agency, and the Corporation, or
(2) the governing bodies of either the Agency or
the Corporation fail to approve the same as a
joint project for a period of 90 days after written
notice is given to them by Brazos that Brazos
wishes to proceed with the project.
(b) Brazos will not hereafter make any expenditure for
the purpose of constructing or acquiring additional transmission
facilities which will interconnect with any of the facilities
of the Cities or any joint projects which are primarily for
transmitting power to the Agency or the Cities unless:
(1) it has obtained the approval of the same as
a joint project from the governing bodies of the
Agency, and the Corporation, or
(2) the governing bodies of either the Agency or
the Corporation fail to approve the same as a
joint project for a period of 90 days after written
notice is given to them by Brazos that Brazos
wishes to proceed with the project.
(c) Brazos will not make any expenditure for the
acquisition of a fuel supply (other than natural gas, oil,
diesel or lignite being acquired as fuel for the generating
facilities mentioned in paragraph (a) of this Section) for
its electric generating facilities unless:
(1) it has obtained the approval of the same as
a joint project from the governing bodies of the
Agency, and the Corporation or
(2) the governing bodies of either the Agency or
the Corporation fail to approve the same as a
joint project for a period of 90 days after written
notice is given to them by Brazos that Brazos
wishes to proceed with the project.
1 _l~_
(d) Except for isolated metering points to provide
energy and capacity from other entities Brazos will not
hereafter enter a contract for the purchase by it of capacity
or energy to meet load plus reserves with any entity other
than the Agency unless:
(1) it has first offered in writing for a period
of ten consecutive days to purchase such capacity
or energy from the Agency, or from one of the
cities (under the same-terms and conditions) and
such offer has not been accepted in writing, or
(2) the Agency notifies Brazos,
in writing, that no capacity or energy is available
in the quantity (under the same terms and con-
ditions) and for the period of time requested by
Brazos.
The provisions of this paragraph (d) have no application
to the purchase of capacity or energy (i) on an emergency or
stand-by basis, or (ii) under a contract having a duration
of less than two years (including any renewals thereof), or
(iii) under contracts with Texas Power and Light Company
(except that power purchased under Section 4.03 (a) entitled,
"Sates--Purchase of Firm Power and Energy") or contracts
with Brazos River Authority or the Southwest Power Administration
or renewals or extensions thereof or (iv) under the contract
which Brazos contemplates will be executed with South Texas
.Electric Cooperative, Inc, and Medina Electric Cooperative,
Inc. or (v) for power or energy incident to the construction
and testing of any facilities constructed under paragraph
(a) of this Section, or (vi) on the basis of economic dispatch
between the Cities, the Corporation, the Agency and Brazos,
any or all, or (vii) under the existing contract with Texas
Municipal Power Pool, Inc., or (viii)'from municipal corporations
that are not then interconnected with other utility companies.
(e) Except for isolated metering points to provide
firm energy and capacity to other entities, Brazos will
not hereafter enter a contract for the sale by it of capacity
or energy to an entity other than the Agency unless:
(1) it has first offered in writing for a period
of ten consecutive days to sell such capacity or
energy to the Agency, or to one of the cities
(under the same terms and conditions) and such
offer has not been accepted in writing, or
(2) the Agency notifies Brazos, in writing, that
no capacity or energy is required in the quantity
(under the same terms and conditions) and for the
period of time offered by Brazos.
The provisions of this paragraph (e) have no application
to tha Sala of capacity or energy (i) on an emergency or
stand-by basis or (ii) on a contract having a duration of
less than two years (including any renewals thereof), or
(iii) under the contracts with Texas Power and Light Company
'except that power purchased under Section 4.03 (a) entitled,
'Sales--Purchase of Firm Power and Energy") or contracts
with Brazos River Authority or the Southwest Power Administration
or extensions on thereof or (iv) under the contract which
Brazos contemplates will we executed with South Texas Electric
roopera*_ive, Inc. and Medina Electric Cooperative, Inc. or
(v) for purchase of power incident to the construction and
-18-
f
testing of any facilities constructed under paragraph (a) of
this Section, or (vi) on the basis of economic dispatch
between the Cities, the Corporation, the Agency and Brazos.
any or all, or (vii) under the existing contract with Texas
Municipal Power Pool, Inc. or (viii) to electric cooperatives
organized under Article 1528a or customers of Brazos who are
not Class 1 utilities (under F.P.C. guidelines) except at
isolated points, or (ix) to renewals of any contract which
Brazos (1) certifies was existing on the date of this agreement,
and (2) supplies in its original and renewed form to the
Corporation or (x) at isolated metering points or (xi) to
municipal corporations that are not then interconnected with
other utility companies.
The purpose and intent of paragraph (e) is to prevent
the sale of surplus electric energy or capacity by Brazos to
others than the Agency if such energy or capacity (1) is
required to meet the needs of the Agency or the cities and
(2) may be made available to the Agency. It is not intended
to prevent the sale of electric energy or capacity to regular
customers of Brazos.
8.10: The participants covenant with each other that
the responsibility of the operation of any facilities constructed
pursuant to this Agreement shall rest with the Corporation;
that all planning of joint projects will be done and performed
by the Corporation; that only projects approved and recommended
by the Corporation shall be considered as projects eligible
for joint action by the participant but nothing herein shall
be construed as a prohibition against the recommendation of
a project by Brazos or the Agency as contemplated by Sections
8.8 and 8.9 A party recommending a pool project under
_
SectiUIl 08.0^ Jr 10.9 oil"all Lvc ulccaucu' t0 have ..rpr_.,^ved the
same
8.11: No other entity may become a participant (other
than Brazos and the Agency) unless (1) it makes substantially
the same undertaking and agreements as contained in this
Agreement and (2) is approved as a participant by the governing
body of Brazos and the Agency.
8.12: As used in this instrument, the term "debt of
the Agency" means the principal of, interest on, reserve
fund for, and any applicable redemption premium with respect
to the initial series of bonds of the Agency [mown as "TEXAS
MUNICIPAL POWER AGENCY REVENUE BONDS, SF:'IES 1975,"
dated September 15, 1975, to be authoriz: -in a principal
amount of not to exceed $10,625,000. Th,; term does not
include any bonds or other obligations issued for the purpose
of refunding, cancelling, and in lieu of such Series 1975
bonds. The parties contemplate that a new contract will be
executed in the event such Series 1975 bonds are refunded or
if additional bond obligations are issued by the Agency
which pledge any income, revenues or payments received from
the Cities or Brazos by the Agency.
For and in consideration of the undertakings of the
Corporation, the Agency and Brazos each agree to pay its
proportionate share of the maintenance and operating expenses
of the Corporation.
-19-
For and in consideration of the undertakings of the
Agency hereunder, Brazos agrees to make payments to the
Agency as set forth in a separate instrument bearing the
same date as this instrument (and made a part hereof for all
purposes). The amount to be paid to the Agency by Brazos is
equal to 25% of the principal, interes!_ and reserve requirements
of the debt of the Agency. It is contemplated by the parties
that Brazos shall hereafter pay 25% of all principal, interest
and revenue requirements of bonds issued by the Agency and
that Brazos shall be entitled to 25% of the energy output of
the generating facilities of the Agency (such percentage
being subject to reduction only by reason of (i) the necessity
of the Agency to continue to comply with the provisions of
the Internal Revenue Code mentioned in paragraph 3 and (ii)
the acquisition of ownership interest by Brazos - as more fully
provided in Article V hereof and Section 4.02 (c) of the
instrument entitled, "Contract for the Development of Fuel
Resources, Planning Electric Generation Facilities and
Performing Certain Duties").
Unless otherwise previously agreed between Brazos
and the Cities the actual expenditures by the Corporation
for-Maintenance and operating expenses shall be paid from
funds supplied by the Agency and Brazos (under the provision
of the additional agreements hereafter mentioned) in the
same proportion as the ratio of the previous year's peak
loads for Brazos and the Cities, and the rate (mills per
kwh) to be paid by such parties (the payments of the city to
be made through the Agency) shall be identical. Further
agreements of the Agency and Brazos are set forth in separate
instruments bearing the same da':e as this instrument (and
-made a part of this agreement for all purposes).
8,13: The parties will operate their respective systems
so that power and energy will not flow from either of such
systems to any point outside of the State of Texas or from
any point outside of the State of Texas into either of them,
and will not interconnect their systems with any other
system to permit any such flow; provided, that tae covenant
contained in this paragraph shall not be effoctivs during
times when and to the extent that both partie:~ (-and those
not otherwise subject to the jurisdiction of ti,-! Federal
Power Commission as Public Utilities, who directly or indirectly
supply power and energy to, or directly or indirectly take
power and energy from, one or both of the parties hereto)
have been granted an exemption, with respect to any transmission
or sale of electric power and energy, by the Federal Power
Commission grader the authority granted to it in the Federal
Power Act or any amendment thereof, or by ocher act of
Congress, from becoming subject to the jurisdiction of the
Federal Power Commission or a successor Federal agency by
reason of engaging in the transmission or sale of electric
power and energy in interstate commerce.
operating conditions, whether normal, inadvertent or
emergency which, in the opinion of either party, may result
in jeopardizing the intrastate status of such party shall,
in addition to any remedies available to it at law or in
equity, be cause for such party suspending either the delivery
or the receipt of power and energy hereunder, or any portion
thereof, until the conditions causing such jeopardy have
been corrected to the satisfaction of the party affecting
such suspension, and it shall be the obligation of the other
party to correct the conditions causing such jeopardy with
due diligence. During the period of any such suspension.
the party affecting such suspension shall not be obligated
to deliver or to receive, as the case may be, power and
energy at the point or points of delivery affected by such
suspension, and the payment of all charges as well as the
assumption of all obligations relative thereto, as specified
herein shall be abated.
-20-
8.14: The parties hereto recognize that certain covenants
made herein (those made in Section 8.8 and 8.9) are made in
contemplation that covenants of similar import will be made
between the Agency and the cities under contracts by and
between the Agency and the cities (those made in Section
1.03 of a contract called "Contract for Development of Fuel
Resources, Planning Electric Generation Facilities and
Performing Certain Duties") which bears the same date as
this instrument.
By reason of the foregoing, the Agency covenants that
it will approve no modification of the provisions of the
aforesaid Sections of its contract with any of the cities
without the prior approval of Brazos, and further covenants
that it will not seek to amend or approve an amendment to
Section 8.8 or 8.9 hereof without the approval of each of
the cities.
The parties hereto further recognize that the payment
of the operation and maintenance expense of the Corporation
and the debt of the Agency is provided through (1) the
several contracts mentioned in Section 8.12 hereof and (2)
the contracts between the Agency and the cities which are
mentioned in the first paragraph of this Section (particularly
Section 4.02 of such contracts). The parties hereto agree
with each other that none of them, during the term of this
agreement, will approve any change in any of the Sections of
the contracts mentioned which provide for such payments of
the maintenance and operating expenses of the Corporation or
the Agency or the debt of the Agency without the prior
approval of Brazos, the Agency, the Corporation and each of
the cities.
9. ANNUAL BUDGETS:
9.1: At )east sixty (60) days before the lst day of
October of each year, the project manager shall prepare and
submit to the Agency and Brazos for their review and approval
a budget covering the maintenance and operating expenses of
the Corporation (including a budget for station work), as
well as the proposed capital expenditure budget for such
ensuing 12 month period.
9.2: In the event Brazos and the Agency have not each
approved a proposed budget for maintenance and operating
expenses of the Corporation by the first day of the fiscal
year, the total amount budgeted in the preceding fiscal year
for such purposes shall be the amount of the temporary
budget for the maintenance and operating expenses of the
Corporation. The temporary budget shall remain in force and
effect until Brazos and the agency have approved a budget.
The Executive Director of the Corporation shall be respon-
sible for the allocation for expenditure of the total amount of
the temporary budget until a permanent budget is adopted and approved.
9.3: Any information required from the participants by
the project manager in preparing the aforesaid proposed
budgets shall be supplied by the participants, if possible,
within fifteen (15) days following a request by the project
manager.
9.4: Any representative of Brazos or the Agency may
appear before the Board of Directors of the Corporation to
protest a particular budget item (its inclusion or the
amount thereof), and it shall be the duty of the Board to
consider such protest, and if the same is not granted (and
the budget item revised in accordance with the protest) the
-21-
Board shall spread upon its minutes the reason therefor and
supply a copy of such minutes to Brazos. The initial
budget of the Corporation, attached hereto, is hereby approved
by Brazos and the Agency.
9.5: The annual budget of the Corporation shall be for
maintenance and operating expenses and cover all expenses of
the Corporation except what is included in the Capital
Project Budget. Expenses which, under standard accounting
practices, should be included as expenditures on a capital
project shall not be included in the annual budget or amendment
thereto as maintenance and operating expenses unless the
governing body of Brazos and the Agency approve a contrary
treatment, provided however, this provision shall be effective
beginning with the budget year 1976-1977.
9.6: A Capital Project budget is a budget of expenditures
for the providing of specific projects except that for tine
initial series of bonds all expenditures for which provision
is made in 6,3 shall constitute a single capital project.
9.7: The Corporation covenants that it will operate
its facilities in an efficient and economical manner and
that it will follow prudent utility practices in the conduct
of its affairs,
10. TAXES:
10.1: To the extent the same may be taxable, each
participant shall render for ad valorem taxation its undivided
interest in the jointly owned property comprising the project
and shall otherwise use its best efforts to have any taxing
authority imposing any such taxes or assessments on the
project, or any interest or rights therein, assess and levy
taxes or assessments directly against the ownership or
beneficial interest said taxes or assessments are levied.
10.2: To the extent of any taxes or assessments collectible
against or with respect to each participant's interest in,
or pro rata share of, the purchase, use, ownership or beneficial
interest in the project, the same shall be the sole responsibility
of, and shall be paid by, the participant upon whose purchase,
use, ownership or beneficial interest said taxes or assessments
are levied.
10.3: If any property taxes or other taxes or assessments
are legally and properly levied or assessed other than
against each participant as contemplated in Section 10.1 and
10.2 hereof (that is, are levied or assessed in such a way
as to be dis roportionately collected from one or both
participants , such taxes or assessments shall be appor-
tioned between the participants in accordance with their
respective ownership interest,
10.4: The participant claiming exemption from any
taxes or assessments shall be responsible for and shall pay
all ex enses in connection with the sustaining or determination
of such claims and the other participant and the project
manager shall lend all reasonable cooperation in connection
with the filing of tax renditions and reports and in connection
g t under protest as ~
with the w.::cir of proust and paymcn ^ .,ay
be requested by each participant claiming an exemption. I
11, WAIVER Or RIGHT TO PARTITION, eiGRTGAGZ MID TRAtiSFER ~
OF INTEITST
11.1 Each participant hereto agrees to waive any
rights which it may have to partition any component of the
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project, whether by partition in kind or by sale end division
of the proceeds and further agrees that it will not resort
to any action in law or in equity to partition such component,
and it waives the benefits of all laws that may now or
hereafter authorize such partition for a term (i) which
shall be cuterminous with the co-tenancy agreement for such
component, or (ii) which shall be for such lesser period as
may be required under applicable law.
11.2: Each participant shall have the right at any
time and from time to time to mortgage, pledge, create or
provide for a security interest in or convey in trust all or
a part of its ownership share in the project, together with
an equal interest in this Participation Agreement and the
project agreements, to a trustee or trustees under deeds of
trust, mortgages or indentures, or to secured parties under
a security agreement, as security for its present or future
bonds or other obligations or securities, and to any successors
or assigns thereof, without need for the prior written
consent of the other participant, and without such mortgagee,
trustee or secured party assuming or becoming in any respect
obligated to perform any of the obligations of the participant
arising prior to such time as such mortgagee, trustee or
secured party obtains possession of or assumes the right to
exercise such participant's rights in respect of such ownership
share, or after such possession or assumption ceases.
11.3: Any mortgagee, trustee or secured party under
present or future deeds of trust, mortgages, indentures or.
security agreements of either of the participants and any
successor or assign thereof, and any receiver, referee or
trustee in bankruptcy or reorganization of either of the
participants, and any successor by action of law or other-
wise, and any purchaser, transferee or assignee of any
thereof may, without need for the prior written consent of
the other participant, succeed to and acquire all of the
rights, titles and interests of such participant in the
project and in this Participation Agreement and the project
agreements, and may take over possession of or foreclose
upon said property rights, titles and'interests of such
participant.
11.4: Each participant shall have the right to transfer
or assign all its ownership share in the project, together
with a proportionate part of its rights under this Partici-
pation Agreement and the project agreements, to any of the
following without the need for prior written consent of the
other participant:
(A) To any entity acquiring all or substantially
all of the electric utility properties and business of
such participant; or
(B) To any entity merged or consolidated with such
participant; or
(C) To any entity which is wholly owned by such participant.
11.5: Except as otherwise provided in Sections 11.2
and 11.3 hereof, any successor to the right, titles and
interests of a participant In the project shall assume and
agree in writing to fully perform and discharge all of the
obligations hereunder of such participant, and such sucessor
shall notify the other participant in writing of such transfer,
assignment or merger, and shall furnish to the other participant
evidence of such transfer, assignment or merger.
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11.6: No participant assigning or transferring an
interest under this or the following Section shall be relieved
of any of its obligations under this Participation Agreement
or the project agreements but shall remain liable and obligated
for the performance of all of the term.. and conditions of
this Participation Agreement and the project agreements,
unless otherwise agreed by the remaining participant.
12. RIGHT OF FIRST REFUSAL:
12.1: Except as provided in Section 11 hereof, should
say participant, prior to the expiration of the period
described in Section 11.1 hereof, desire to transfer its
ownership in the project to any person or entity, ready,
able and willing to acquire same, the participant desiring.
to make such transfer shall obtain a written offer from the
prospective transferee, setting forth the consideration and
other terms of the offer, and the other participants shall
have the right of first refusal to acquire such interest on
the basis of the following consideration:
(A) If the offer is in cash, whether payable in one
payment or in installments, the amount of the bona fide
written offer from the prospective transferee, payable
as specified in the offer; or
(B) If the offer is not in cash but is in securities
having a readily ascertainable market value, the fair
market value of the securities offered by the prospective
transferee; or
(C) If the offer is neither in cash nor in securities
having a readily ascertainable va.rket value, the fair
market value of the ownership interest to be transferred.
12.2: At least twelve (12) months prior to the date on
which the intended transfer is to be consummated, the
participant desiring to transfer shall serve written notice
of its intention to do so upon the other participants. Such
notice shall contain the proposed date of transfer and the
terms and conditions of the transfer.
12.3: The other participants shall have the option to
acquire the interest to be transferred and shall exercise
said option by serving written notice of its intention upon
the participant desiring to transfer within twelve (12)
months after service of the written notice of intention to
transfer given pursuant to Section 12.2 hereof. Failure of
the participants to exercise said option as provided herein
within the time period specified or the receipt of a written
notice that such participant elects not to exercise such
option shall be conclusively deemed to be an election not to
exercise said option so as to permit the intended transfer
to be accomplished.
r
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12,4: When the option to acquire said ownership has
been exercised, the participants shall thereby incur the
following obligations:
(A) The participant desiring to transfer the ownership
interest and the participants having exercised the
option to acquire such ownership interest shall be
obligated to proceed in good faith and with due diligence
to obtain all required authorizations and approvals of
such acquisition.
(B) The participant desiring to transfer such ownership
interest shall be obligated to obtain the release of
any lien encumbering the ownership interest which is
the subject of the transfer at the earliest practicable
date.
(C) The participants having exercised the option to
acquire such ownership interest shall be obligated to
perform all of.the terms and conditions required of it
to complete the acquisition of said ownership interest.
12.5: The acquisition of the ownership interest by the
participant having elected to acquire the same shall be
fully consummated within six (6) months following the date
upon which all notices required to be given under this
Section 12 have been duly served.
12.6: If the participants receiving notice of the
proposed transfer fail to exercise its option to acquire the
ownership interest to be transferred, the participant desiring
to transfer such interest shall be free to transfer such
interest, to the party that made the offer referred to in
Paid bona fide written offer. If such transfer is not
consummated by the proposed date of transfer referred to in
Section 12.7 hereof, the participant desiring to transfer
said ownership interest must give another complete new right
of first refusal to the other participant pursuant to the
pprovisions of this Section 12 before such participant shall
be free to transfer said ownership interest to another
party,
12,7: The participants who acquire an ownership interest
pursuant to this Section shall receive title to and shall
own the interest as a tenant in common, subject to the same
rights, duties and obligations as are applied by this Parti-
cipation Agreement and ty the project agreements to the
interest being transferred in the hands of the transferring
participant.
12.8: Any party who may succeed to an ownership interest
pursuant to this Section shall specifically agree in writing
with the remaining participants at the time of such transfer
that it will not transfer or assign all or any portion of
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such ownership interest without complying with the terms and
conditions of this Section 12,
12,9: The participants who acquire an ownership interest
pursuant to this Section shall acquire such proportion of
ownership of the participant desiring to transfer as may be
agreed upon by them.
13. DESTRUCTION OR ABANDONMENT:
13.1: If properties constituting the project should be
damaged or destroyed to the extent that the estimated cost
of repairs, replacement or reconstruction is not more than
one hundred percent (100%) of the aggregate amount of the
proceeds from property damage insurance carried and covering
the cost of the repairs, replacement or reconstruction, the
participants, unless otherwise unanimously agreed, shall
repair, replace or reconstruct that part of the project to
substantially the same general character or use of as original.
The participants shall share the costs of such repairs,
replacement or reconstruction in proportion to their ownership
in the project.
13.2: If property constituting the project (those
items specified as items 3 and 4 of the definition of the
term project) should be damaged or destroyed to the extent
that the estimated cost of repairs, replacement or reconstruction
is more than one hundred percent (100%) of the aggregate
amount of the proceeds from property damage insurance carried
and covering the cost of the repairs, replacement or reconstruction
of such project, the participants shall, upon agreement,
repair, replace or reconstruct such properties to substantially
the same general character or use as the original; provided,
however, that should the participants not agree to repair,
replace or reconstruct such project, then any participant
who does not agree to repair, replace or reconstruct shall
sell its interest therein to the participants desiring to
repair, replace or reconstruct such project for a price
equal to the selling participant's proportionate interest in
the salvage value thereof plus such participant's proportionate
cost, less depreciation at the maximum straight line rates
then applicable to like properties under the Federal income
tax law, in the interest in the project so sold.
13.3: Should the participants determine it is not
economically feasible to repair any damaged property or to
replace property which has been destroyed by reason of fact
that it is not economically feasible so to do or by reason
of,the fact that such properties are no longer needed, then
any insurance proceeds may be apportioned to the participants
in proportion to their ownership interests.
14. PROJECT INSURANCE:
14.1: The project manager shall recommend to the
Agency and Brazos, and the Agency and Brazos shall determine,
the insurance coverages, including the insurable values,
limits, deductibles, retentions and other special terms, and
the insurance carriers from which such insurance is to be
obtained during the periods covered by and with respect to
construction work and station work or any phases thereof,
14.2: All policies of project insurance shall:
(A) List as loss payees or additional insureds (as
their interest may appear) such mortgagees, trustees or
-2b.
secured parties as a participant, by written notice to
the project manager, may designate;
(B) Contain endorsements providing for positive notice
of cancellation to all parties listed as named or
additional insureds;
(C) Contain endorsements providing that the insurance
is primary insurance for all purposes; and
(D) Contain cross-liability endorsements for com-
prehensive bodily injury liability and property damage
liability coverages.
14.3: Each participant, at its expense, shall have the
right to secure such additional or different insurance
coverage as may be required under any mortgage or contract
provision, and, to the extent practicable, such additional
or different insurance coverage may be effected through
endorsements on policies of project insurance.
15. LIABILITY OF PARTICIPANTS TO EACH OTHER:
15.1: Participants shall have no remedies against the
other participant for tortious conduct arising out of the
ownership of the project, or any portion therof, or out of
construction work or station work except when the claim
results from willful action.
15.2: Remedies of a participant with respect to a
claim against the other participant shall be unimpaired by
this Participation Agreement when the claim does not arise
out of ownership of the project or any portion thereof, or
out of construction work or station work.
15.3: Each participant shall protect, indemnify, and
hold the other participant, and its directors, officers and
employees, free and harmless from and against any and all
claims, demands, causes of action, suits or.other proceed-
ings (including all costs in connection therewith and in
connection with the defense thereof, including attorneys'
fees) of every kind and character arising in favor of any of
that participant's electric customers (or anyone claiming
through that participant's electric customers) on account of
bodily injuries, death, damage to property or economic loss
in any way occurring, incident to, arising out of or in
connection with the furnishing of, or failure to furnish,
electric service to such customers, it being the intention
of this Section to impose on each participant the sole
responsibility for the defense and discharge of such claims,
demands, causes of action, suits or other proceedings brought
against one or both participants by a participant's customers
even when caused by the sole fault of the other participant.
Nothing in this Section shall impair the remedies of a
participant against the other participant preserved by
Sections 15.1 and 15.2 hereof.
16. DEFAULTS AND COVENANTS REGARDING OTHER AGREEMENTS:
16.1: Each participant hereby agrees that it shall pay
all monies and carry out all other duties and obligations
agreed to be paid or performed by it pursuant to all of the
terms and conditions set forth and contained in the project
agreements, and a default by either participant in the
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' r
covenants and obligations to be by it kept and performed
pursuant to the terms and conditions set forth and contained
in any of the project agreements shall be an act of default
under this Participation Agreement.
16.2: In the event of an alleged default by any participant
in any of the terms and conditions of the project agreements
concerning the advancement of funds, then, within ten (10)
days after written notice has been given by any nondefaulting
participant to the defaulting participant of the existence
and nature of the default, the nondefaulting participant
shall remedy such default by advancing the necessary funds
or commencing to render the necessary performance.
16.3: In the event of an alleged default by any parti-
cipant in any of the terms and conditions of the project
agreements and the giving of notice as provided in Section
16.2 hereof, the defaulting participant shall take all steps
necessary to cure such default as promptly and completely as
possible and shall pay promptly upon demand to the nondefaulting
participants the total amount of money or the reasonable
equivalent in money of nonmonetary performance, if any, paid
or made by such nondefaulting participants in order to cure
any default by the defaulting participant, together with
interest on such money or the costs of nonmonetary performance
at the rate of 10% per annum from the date of the expenditure
of such money or the date of completion of such nonmonetary
performance by such nondefaulting participant, or such
greater amount as may be otherwise provided in the proje
agreements.
16.4: In the event that any participant shall dispute
an asserted default by it, then such participant shall pay
the disputed payment or perform the disputed obligation, but
may do so under protest. The protest shall be in writing,
shall accompany the disputed paymF..c or precede the performance
of the disputed obligation, and s -L! specify the reasons
upon which the protest is based. A copy of such protest
shall be mailed by such participant to the other participants.
Payments not made under protest shall be deemed to be correct,
except to the extent that periodic or annual audits may
reveal over or under payments by participants, necessitating
adjustments. In the event it is determined that a protesting
participant is entitled to a refund of all or any portion of
a disputed payment or payments or is entitled to the reasonable
equivalent in money of nonmonetary performance of a disputed
obligation theretofore made, then, upon such determination,
the nonprotesting participants shall pay (in proportion to
their ownership shares) such amount to the protesting participant,
together with interest thereon at the rate of 10% per annum
from the date of payment or of the performance of a disputed
y obligation to the date of reimbursement. The determination
for which provision is made in the preceding sentence shall be
made by an independent certified public accountant or an
independent registered professional engineer named jointly
by the Agency and Brazos. .
16.5: In the event a default by either participant in
the payment or performance of an obligation under the project
agreements shall continue for a period of six (6) months or
more without having been cured by the defaulting participant
or without such participant having commenced or continued
action in good faith to cure such default, or in the event
the question of whether an act of default continues for a
period of six (6) months and the defaulting participant has
failed to cure such default or to commence such action
during said six (6) month period, then, at any time thereafter
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• and while said default is continuing, the nondefaulting
participant may, by written notice to the defaulting participant,
suspend the right of such defaulting participant to use or
utilize all or any part of the project, in which event:
(A) During the period that such suspension is in
effect, the nondefaulting participant shall bear all of
the operation and maintenance costs, insurance costs
and other expenses otherwise payable by the defaulting
participant under the project agreements,
(B) The defaulting participant shall be liable to the
nondefaulting participant for all costs incurred by
such nondefaulting participant together with interest
as provided in Section 16.3 hereof.
16.6: The rights and remedies of the participants set
forth in this Participation Agreement shall be in addition
to the rights and remedies of the participants set forth in
any other of the project agreements.
17. ACTIONS PENDING RESOLUTION OF DISPUTES: Pending the
resolution oany dispute by an accountant or engineer (Section
16.5) or by judicial proceedings, the project manager shall
proceed with the construction work or station work in a
manner consistent with this Participation Agreement and the
project agreements and with the best judgment of the project
manager, and the participants shall advance the funds required
to perform such construction work or station work in accordance
with the applicable provisions of the Participation Agreement
or the project agreements.
18. RELATIONSHIP OF PARTICIPANTS: The covenants, obligations
and liabilities o the part c pants shall be several and not
joint or collective. Each participant shall be individually
responsible for its own covenants, obligations and liabilities
as herein provided and as provided in the project agreements.
It is not the intention of the parties to create, nor shall
this Participation Agreement nor any of the project agreements
be construed as creating, a partnership, association, joint ven-
ture or trust, as imposing a trust or partnership covenant,
obligation or liability on or with regard to either of the
participants, or as rendering the participants liable as
partners or trustees. No participant shall be under the
control of or shall be deemed to control the other participant.
A participant as such shall not be the agent of or have a
right or power to bind the other participant.
19. ACQUISITION OF REAL PROPERTY I11TERESTS: The project
manager shall acquire, or cause to be acquired, in the name
of the Agency or Brazos, or both, by purchase or eminent
domain proceedings, such interest in land as may be approved
by the participants or a committee appointed by them.
Acquisition of the real property shall be based upon title
insurance prior to commencement of the construction work
thereon. The purchase price for all lands acquired and all
costs and expanses incurred in connection with the acquisition
of said lands, including, but not by limitation, title
insurance premiums, abstracters, attorneys, surveyors,
nominees and land agents' fees, title curative wor%, court
costs and recording fees, shall be construction costs and
borne by the participants as such. The purchase price for
all land acquired through voluntaryy conveyance shall be
approved by a committee appointed by the participants.
-29-
20, FORCE MAJEURE: (a) If for any reason of "force majeure"
any oEthe parties hereto shall be rendered unable wholly or
in part to carry out its obligations under this agreement,
other than the obligation of the participants to make the
payments required under the terms hereof (including the
agreements mentioned in Section 8.12), then if such party
shall give notice and full particulars of such reasons in
writing to the other party within a reasonable time after
the occurrence of the event, or cause relied on, the obli-
gation of the party giving such notice, so far as it is
affected by such "force majeure", shall be suspended during
the continuance of the inability then claimed, but for no
longer period, and any such parties shall endeavor to remove
or overcome such inability with all reasonable dispatch.
The term "force majeure" as employed herein shall mean acts
of God, strikes, lock-outs, or other industrial disturbances,
acts of public enemy, orders or actions of any kind of the
Government of the United States or of the State of Texas or
any civil or military authority, insurrections, riots,
epidemics, landslides, lightning, earthquakes, fires, hurricanes,
storms, floods, washouts, droughts, arrests, restraints of
government and people, civil disturbances, explosions,
breakage or accident to dams, machinery, pipelines, or
canals or other structures or machinery, on account of any
other cause not reasonably within the control of the party
claiming such inability. It is understood and agreed that
the settlement of strikes and lock-outs shall be entirely
within the discretion of the party havinfi the difficulty,
and that the above requirement that any 'force majeure"
shall be remedied with all reasonable dispatch shall not
require the settlement of strikes and lock-outs by acceding
to the demand of the opposing parties when such settlement
is unfavorable to it in the judgment of the party having the
difficulty.
(b) No damage shall be recoverable from participants
by reason of the causes above mentioned,
21. GOVERNING LAW: This agreement shall be governed by the
laws 31 the State of Texas, except as to matters exclusively
controlled by the Constitution and statutes of the United
States of America.
22. BINDING OBLIGATIONS: All of the respective covenants,
underta ngs an o gations of each of the participants set
forth in this Participation Agrvcment and in each of the
project agreements shall bind and shall be and become the
respective covenants and obligations of each such participant
and, to the extent permitted by law and the existing contracts
of the applicable participant, shall apply to and bind:
(A) All mortgagees, trustees and secured parties
under all present and future mortgages, indentures and
deeds of trust, security agreement and other financing
arrangements which are or may become a lien upon any of
the properties of such participant;
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(B) All receivers, assignees for the benefit of creditors,
bankruptcy trustees and referees of, or having control
or jurisdiction over, such participant;
(C) All other persons, firms, partnerships, corporations
or entities claiming by, through or under any of the
foregoing; and
(D) Any successors or assigns of any of those mentioned
above in this Section;
and shall be covenants and obligations running with each
participant's respective rights, titles and interest in the
project and with all of the rights and interest of each
participant under this Participation Agreement and the
project agreements, and shall be for the benefit of the
respective rights, titles and interests of the participants
and their respective successors and assigns, in and to the
project. It is the specific intention of this provision
that all such covenants and obligations shall be binding
upon any party which acquires any of the rights, titles and
interests of a participant in the project or in, to and under
this Participation Agreement or-any of the project agreements
and that all of the above-described persons and groups shall
be obligated to use such participant's rights, titles and
interest in the project or in, to or under this participation
Agreement or any of the project agreements for the purpose
of discharging the covenants and obligations under this
Participation Agreement and the project agreements.
23. PROJECT AGREEMENTS:
23.1: The participants hereto agree to negotiate in
good faith and to proceed with diligence to obtain and agree
upon all of the project agreements among the participants
and between the participants and other entities.
23.2: It is acknowledged by the participants that one
or more of the project agreements may contain provisions
which are in conflict with or contrary to the terms of this
Participation Agreement, and any such provision in a project
agreement executed subsequent to the execution of this
Participation Agreement shall be deemed to supersede, amend
or modify any conflicting or contrary provision contained
herein. The mutual agreement of the participants to super-
sede, amend or modify the terms hereof shall constitute the
legal consideration to support such change in the legal
rights and obligations of the participants.
24. ENVIRONMENTAL PROTECTION: '
24.1: In recognition of the need to provide for the
greatest feasible degree of environmental protection, the
participants hereby covenant with one another that in the
construction and operation of the project they shall install
and operate any needed air quality control equipment and
water quality control equipment.
24.2: The participants, in recognition of all appli-
cable Federal, State and local laws, orders and regulations
relating to environmental protection with which they intend
to and shall fully comply, and the continuing need for the
greatest feasible degree of environmental protection, hereby
affirm their understanding.
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24.2: The participants, in recognitio
24.3: The participants shall take appropriate measures
to minimize the effect of the project on the environment and
shall recognize and consider the ecology of the area in the
design of any part of the project.
25. TERM: This Participation Agreement shall become effec-
tive wren it has been duly executed but only when the agreements
mentioned in Section 8.12 have also been executed and are
likewise effective as a part of this Agreement,
This Participation Agreement shall remain in force and
effect until the debt of the Agency is paid off, cancelled
or refunded exxc~ept_ that part of the Agreement which relate£
the payment of maintenance and operating expenses of the
Corporation shall continue as therein provided and the
option granted in Section 5.2 shall survive such debt retirement,
26. INTEREST ACQUIRED IN THE NAME OF AN INDIVIDUAL PARTICIPANT:
ny part c pant which acquires in is name an interest,
in any real or personal property or a contractual right
which is part of the project shall acquire and hold same
subject to this Participation Agreement and any applicable
project agreem$nt, and shall transfer and assign an undivided
interest therein to the other participant so that the ownership
and rights of the participants in such property or contract
shall be as provided in this Participation Agreement or in
-'the applicable project agreements.
27. NOTICES:
27.1: Any notice, demand or request provided for in
this Participation Agreement or in the project agreements
shall be deemed properly served, given or made if delivered
in person or sent by registered or certified mail, postage
prepaid, to the participants at the addresses specified
below:
BRAZOS ELECTRIC POWER COOPERATIVE, INC.
2404 La Salle Avenue
Waco, Texas 76701
Attention: Executive Vice Pres, and Gen. Manager
TEXAS MUNICIPAL POWER AGENCY
Forest Park Center
7111 Bosque Blvd.
Waco, Texas 76710
Attention: Executive Director
TEXAS POWER POOL, INC..
Forest Park Center
7111 Bosque Blvd.
Waco, Texas 76710
Attention: Executive Director
27.2: A participant may, at any time, by written
notice to the other participant, designate different ov
additional persons or different addresses for the.giving of
notices hereunder.
' -3R-
1 27.3: The project manager shall provide to each parti-
cipant a copy of any notice, demand or request given or
received by it in connection with this Participation Agree-
ment or any of the project agreements.
28, MISCELLANEOUS PROVISIONS:
28.1: Each participant agrees, upon request by the
other participant, to make, execute and deliver any and all
documents and writings of every kind reasonably requested or
req,tired to implement this Participation Agreement and the
project agreements.
28.2: The captions and headings appearing in this
Participation Agreement and in the project agreements are
inserted merely to facilitate reference and shall have no
bearing upon the interpretation thereof.
28.3: Each term, covenant and condition of this
Participation Agreement and of the project agreements is
deemed to be an independent term, covenant and condition,
-and the obligation of any participant to perform all of the
terms, covenants and conditions to be kept and performed by
it is not dependent upon the performance by the other participant
of any or all of the terms, covenants and conditions to be
kept and performed by it.
28.4: In the event that any of the terms, covenants or
conditions of this Participation Agreement or of any of the
project agreements, or the application of any such term,
covenant or condition, shall be held invalid as to any
person or circumstance by any court having jurisdiction in
the ;remises, the remainder of such agreement, and the
application of its terms, covenants or conditions to such
persons or circumstances shall not be affected thereby.
28.5: The partic{.pants do not intend to create rights
in or to grant remedies to any third party as a beneficiary
of this Participation Agreement or a project agreement or of
any duty, covenant, obligation or undertaking established
therein.,
28.6: Any waiver at any time bya participant of its
rights with respect to a default or any other matter arising
in connection with this Participation Agreement or any'
project agreement shall not be deemed a waiver with respect
to any subsequent default or matter.
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,,1 ,
IN WITNESS WHEREOF, the parties hereto have caused
this Participation Agreement to be executed as of the
day of 1975.
TEXAS MUNICIPAL POWER AGENCY
By
President, ard of Directors
ATTEST:
Secretary, oar o Directors
(Agency Seal)
BRAZOS ELECTRIC POWER COOPERATIVE, INC.
By
res ent, Boar o rectors
ATTEST:
Secretary, ar o rectors
(Corp. Seal)
TEXAS POWER POOL, INC.
By
res ent, Boar o Directors
ATTEST
Secretary, oar o rectors
(Corp. Seal)
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,Y.
. Draft 12
EXHIBIT "A" 9/16/75
TEXAS MUNICIPAL POWER AGENCY
Fonnulae To Be Used In Connection With
Brazos Purchase Option Price
A: BRAZOS OPTION PRICE
1. Up to an additional 17% (No reduction in Brazos' debt service
percentage)
P - Option Price
A = % of total to be purchased
B = Total facility/activity costs expended to date option exercised
C = Total costs of financing
D = Interest paid to date option exercised less capitalized interest
E = Balance in Reserve Fund at date option exercised
F = Total principal payments on debt to date option exercised
P - .75 A rB +rC+04 + .25 A r6 +(C+D-E-F}~
L ` J L ` 97 J
Example: Purchase additional 10% of total on 9-1-78
A - .10 D = $1,632,000
B = $9,201,500 E = $1,415,545
C. = $1,699,545 F = $1,115,000
P = .75 F.10 P9 , 201,500 +A 6991545 + 1,632,000 - 1,415,545) +
L. 1.
.25 .10 P9,201,500 +(I 69; 515 + 1,632,000 - 1,415,545 - 1,775,0001
P = .75 (18:179676) + .25 (934,686)
P e $1,0711929
2. Above addition,;; 17% (Reduction in Brazos debt service percentage)
T = Option price
P x Option price for first 17% computed in accordance with 1.4bove
(A = .17)
•
A = % of total above 17% to be purchased
B - Total facility/activity costs expended to date of option
exercise
C - Total costs of financing
D = Interest paid to date of option less capitalized interest
E = Balance in Reserve Fund at time of option
F = Total principal payments made on debt to date of option
T = P + A r + C+D-E-F
( .;7
Example: Purchase additional 25% of total on 9-1-78.
P - Option price computed in accordance with 1. above where A = .17
A = .08 (.25-.17)
B = $9,201,500
C = $1,699,545
D = $1,632,000
£ = $1,415,545
F = $1,775,000
T = .75 .11 9,201,500 + (1,699,545 + 1,6329000 - 1,415,54 5 +
% .91
.25 .17 9,201,500 +6,699,545 + 1,632,000 - 1,415,545 - 1,775,000) +
.97
.08 9,201,500 +/1,699 1,6999545 + 1 632 000 - I y415,545 - 11775%. 0
.9/
T = .75 (11900,049) + .25 (19588,966) + .08 (99346,861)
T = $2,510,027
i
i
" Draft t2
EXHIBIT "S" 4/16/75
TEXAS MUNICIPAL PONFR AGENCY
Formulae To Be Used In Connection With
Debt Service Payment Adjustments -Brazos
Purchase Option
A. All funds received by Agency from Brazos shall be immediately used
to reduce (call) outstanding Bonds of Agency
B. Adjustments to Payment of Debt Service
1. Brazos Purchases Up To 4n Additional 17% of the Total Project
a. Debt service requirements are adjusted to eliminate
requirements of called Bonds.
b. New payments equal to a. times product of:
Brazos - 25.0%
Bryan - 14.3%
Denton - 15.0:
Garland - 33.3%
Greenville - 7.4%
2. Brazos Purchases Over An Additional 17% of the Total Project
a. Debt service requirements are adjusted to eliminate
requirements of called Bonds.
b. Brazos - New payments tqual to a. times product of new
percentage calculated as follows:
x = % of Agency's debt requirements to be paid by
Brazos
y = % of total project ovm ed by Brazos
z = Total % of participation desired by Brazos
in total project (both owned d contracted)
X = (2/1-y) - (y/1-y)
Example: Brazos purchases an additional 25% (owns 28% of
total project) of total project and wants total
participation to be equal to 40%
y = .28
z = .40
X = (.40/1-.28) - (.28/1-.28)
x = .5556 - .3689
x - .1667
J
• C. Cities - Each City's new payments are equal to a. less b. times:
Bryan - 25.7%
Denton - 20.0%
Garland - 44.4%
Greenville - 9.9%
TEXAS POWER POOL, INC. BUDGET
1
. t'?^t Ab'IMIS1t411710, nfVfsMU. CKAATIMi
• AM m I I IIIts WOCEI jlI
OCIOM 1175--UPUM90 1976
740 EDIIl111f IRATId KrMg. DEC_ JA11. E(l. 11011_ A". MAY J1ed JUST kX, ff /T. is.
1.lsr4et(1) f 1.61.0 117,750 $ 121250 S 13,454 f 1),180 1 U.45n I 93,464 1 7),160 1 14,150 s 22,21.1 { 111550 1 71,,50 latrsl Office (10) E,9Do 7.000
1.100 ).IDD ),no 1.700 7.)OO 1'.700 7.100 ).100 7.500 1,500 Travel end eeetln9s 2.000 7.000 7,100 2.100 2. no ?.NO ?1300
71)00 2,100 1.400 2,500 2,500 hu"lelSis=• 54161219, P AI kt- _ AA _ L" 5.00 600 900 100 700 000 no 900 _
S,Atotsl { 17,050 1 17,750 s 12,050 S it.m f 11,S6o 119.Sd0 1 11,680 s 19,060 S 20.950 120.K0 111.150 S 21.1Sr MESSIOIK EtKrA$ AND teµl feel Ut) IO.DoO S 70.000
S 10.000 6 1.000 9,000 S 6.000 S 6.000 4.000 1.000 I 1.000 1 6,000 1 1.000 its tenolunt (12) 500 Soo 600 Soo Soo 600 Soo SOO
Soo SOO Tlf prtklpetloe Soo $00 Soo 100 SOO Soo 900 500 fo0 Soo $00 500 Aw std sana11 report ID,OM
9eflrosd Caelssfeo lleuSn4l
200. 200 200 200 200 200 TOO tOO 200 200 100 100 tool)LSat 9,500 flotnte Ter Gpeut1,000 1,000 1.000 1,000
1,000 1.000 1,000 1,000 L144 1116 oteentlne tlodTes 200 200 no no no 200 200 200 too 200 no 200 2,4
MOT strip 100 100 100 100 100 100 too loo 100 too 100 100 16
9ncAOte sni Edbcstlr 600 Soo Soo 500 500 500 Soo 500 500 '500 $40 500 6,
k"tlstlen 9 consoluatf S,DDO 5.000 5.000 5.000 S,ODO $1000 $1000 $1000 6.000 5,000 5,000 5,000 60,
711sc411tnw4s SWdIeS 2.000 2,000 2.000 7,000 2.000 _ 2.000 2,000 2.000 2.000 2.000 _ 2.000 2.000 24.. Su9qu1 f 19,SOO S t9,SOO
S 20.000 S 111.000 f 19.000 S 16.000 1 16,000 114,000 J 15.500 1 1).000 1 17.000 S 1),9300 J 2451
' ~ OK AAIIOD Es K1ISt
fool lFd Fitts OllptlcRln$ 1 1,600 s 1.800 s 1.600 S 1.600 f 1,600 I 1,600 6 1.600 s ),600 f 1.600 S 1,600 1 1,600 s 1,600 s H
(ACltiflEf U1►f11SE
9eun Deed { 9,000 s 9.oc0 s 9,000 S 1,000 s $1000 1 11,000 s 1,000 S 9,000 1 9.000 f 9,000 S 9,00l, f 1.000 1 108,
Oil Tsrttal epvett" 1.500 I Ki. _1. SM SSW 1,500 11540 I .W 11600 ~ Soo 1.500 _j.sv, I,i00 Is,
SM4eu1 { IO,SCO S 70,500 s )0.100 S 10.500 f 10.s00 s IO,SOO S 10.500 s 10.500 f !0,500 s 70,500 s 19.700 s 10,500 1 116.
Tou) S 49,650 S 59.)50 I So.:oo $ 19.)10 S 49.660 S 47.660 6 47.960 f 0.900 S 16.150 $ 15,950 S 44,250 s 46,250 { SBS,>
All0UlT10,t TO 11E70Edf(t4)
~m 11o.100 s 20, too f 20.000 s 20.100 s 20,100 s 70,000 1.20 .1D0 s 20.100 120,000 s to.loo s 20,100 120,000 f 240.
7.400 7.100 7.400 1,400 74DO 7.400 7.400 7,400 7.4DO 7.400 7,400 7,100 q
! 6040 6,)50 6,11.0 3,756 1..140 S:YA 5,710 6,750 5,740 S.)SO 5,710 9.154 5.><0 N,1
WSW 13,930 1),930 1),610 1).670 17,00 1),6+0 17.930 1),930 11,640 17.8)0 1),670 2).640 1K,
rrleertlTl 2,110 2.170 9.170 1,160 11170 9.170 2.160 14110 2.110 2,170 MID 21160 K
r' ~
.
IJI.t Ilu, I
r
0;4,1,1;Ac'1' 1 ~(1R 111?VILlll'111:FJ'P 0Jl I LII{I, Itl:S11111:(a:,:,
FLANN'I1!(: L''r1(:ll,l''Jii5 AND
1'1:RI UR111IJi: CEWI-AlfJ D1lTJ li:i
T111S INSTI;1i*11'JIT emba(lics four sell-tVat:o cons which
for the mo:;t hart are idenlAval, in order I haL all parties I
sif;natory will be apprised of all content: and under no ,
r }',:tLion, which under
::;:xnnc
i.~
circumstance doe:; one city an obli
the terms herocif, is assumed by another city. These contracts
are ma,Je and I atorc:d itttu a, of Llle day of Scptcluber,
1975, the first contract is by and bEN-~ n the 'TEXAS EURICIVAL
POWER ACr:1,CY (herei;l.+fter called "Agency"), and Lhe City of
Bryan (hereinafter called "Io yanand a second contract is
by :uld beLweau LAW AJ;ency at,,t Litt City of DenLen (hcreinafter +
called "Denton"), and a third contract; is by and between the ~I
Ar:.cy and the Ciev of Carland (hereinafter called "Garland")
U ,
and a fourth contract is by and between the Agency and the t
City of Greenville (hereinafter called "Greenville"), each
of such cities beinf; a municipal corporation organized and
existing under the Constitution and laws of the State of
'texas (hereinafter collectively called "cities" or "each
city" or "the city"), and each of such parties being a
political subdivision of the State of Texas, and a body
politic and corporate.
i
W I T N E S S E T 11
_
Mii.:REAS, under tilt provisions of Article 1435a, V.A.T.C.S.,
entities engaged in the generation, transmission, or distri-
bution of electric energy may join together as co-tenants or
co-owners in the planning, financing, acquisition, construction,
ownership, operation and maintenance of electric generating
units and plants, electric transmission lines and other
elects:ic facilities; and may enter into agreements for the
planning, financing, acquisition, ,:w,str'uctiull, ownership,
operation and maintenance of jointly owned and operated
electric facilities; and
WHEREAS, acting pursuant to Section 4(a) of Article
1435a,"V.A.T.C.S., the Texas Municipal Power Agency has been
created and established as a municipal power agency (without
,
taxing power) as a separate municipal corporation, a political
subdivision of the State and a body politic corpora Le, and
such agency has and may exercise all of the powers which are I
by Chapter 10 of Title 28, Revised Civil Statutes of Texas,
1925, as amended, and Article 1435a conferred upon a public
entity or entities; and
WHEREAS, the Agency is empowered to make contracts and
agreements with municipalities, political subdivisions of
the State, and public or private corporations or persons and
perform all acts necessary for the exercise of the full
powers invested in it; and
MIEREAS, by virtue of the foregoing, each of the parties
hereto is empowered to execute this contract; now, therefore,
THE PARTIES TO EACH (`ONTRACT, IN CONSIDERATION OF THE
VUTUAL AGREENF.NTS AND UNDI:RTAKINCS 11 ERE' INAFTER SET FORTH,
1WRI:IIY CONTRACT AND ACRE F AS FOLLOWS:
ARTICLE. I
SECT_'_ION _1.01; AS the brlsia for iL:, entcrirrl; into thin
contn-A C, t~I pal•tlvs to Lhose sevet'al conLracts each malce
the following finding;:: 01 (act: t
r
1'hc Ci ti c s c•f Rrynn , Denton garland and Green- E:
ville and the Brazos ElOcLric 1'0%:.!r Coops,raLive. loc.
(hereinafter collectively referred to as "entities"):
(1) each maintain its own electric generating
facilities to meet power Mud electric energy
requirements for its own elccLric system; and have r
entered info a pooling agreement with each other
for the purpose of:
(i) effecting; investment and operating
economies by pooling the use of reserve e
electric capabilities and capacities; and
(ii) obtaining power during emergencies and
scheduled maintenance service; and f
(2) are members of the Texas Interconnected [
System so that the generation plus purchased power
will equal forecasted peak demands increased by
15% in order to provide the pro rata,share of the
reserves required by the Texas Interconnected
System; and
above
(3) endeavor to carry a spinning reserve a
load requirements, as required by Texas Inter-
connected System, and
(4) have electrical systems which are connected
by more than 1900 miles of transmission lines
which extend southward from the Oklahoma border to
just north of Houston, as well as from Aryan to as
far west as Seymour with coordination of generation
and transmission now being provided by a central
dispatching center in Waco, Texas, (which center
coordinates the level of generation of each plant
and the control of the system transmission lines
and substations), and
(5) now have a basic transmission interconnection
between the parties which are provided through 69
and 138 kv transmission facilities of the Brazos
Electric Power Cooperative, Inc., and in some
instances direct connections between the parties
and privately owned utilities in the arca-- of
service.
(b) On a national level load growth for electric
systems has doubled approximately every 10 years but
the load growth of the entities' systems has almost
quadrupled in approximately 11 years, and the projected
power requirements of the entities indicate that additional
generating and transmission facilities will be required
each year of the peak demands neededxbydthaedyvard19a half 90, andn order to meet
(c) it appears that small independent plants will not
meet the needs of the future (1) because of their
higher construcLion and operating; costs which result in
power costs higher rlian for larger, more efficient
plants, and (2) larger plants wonid provide for efficient
utilization of generation and tramsmission facilitieq,
increased reliability and a redsLion in multiple
planning and operating costs, an
problems; and
-2-
~i
i
~I
(d) In Cr,tuleetiun %-d Lh Lhe 1>l anS of the parts hereto
to acquire and obtai.u ndcJi.ti(,nal g;ener:ition facilitieS
it is apl„irent HULL: a new supply of fuel will be required 1r~
since (1) natural g;ns is Lbe primary fuel source for ;JI
the gencrntinl, ,ac.ilities for c.-Ch of the entities, and r
(7) the supply of natural gas as a fuel is of questiunublc
dependability and duration in the iig;hL of existing b
supply conLrncLS and the impending; curtaflmcnt of
delivery and restrictions on Ole use of natural gas for
boilers; and (3) it is also apparent that the constructiun
of a large lignite fired generating; plant by this ir{
entity acting alone would not be economically feasible;
and
(e) A consideration of the load growth of the parties
indicates that projections could vary from the histor-
ical treiids but sharing of capacity with other entities
will reduce the ha:cards of incorrect load projections
for the entity anti judicious adjustment may be made in
the date for placing new joint facilities in service;
and
(f) It appears that there is a need to expand joint
efforts of the parties to include not only the sharing
of the reserves but also the benefiLS of economic dis-
patch and savings in capital costs by the construction
of large units in a coordinated plan; and
(g) Petroleum products, particularly natural gas, have
increai:ed in price from 3 to S times, and natural gas
curtailments have occurred on a rando with the
serious consequences in fuel supply problems by
entity, and additional curtailments are being ordered
by various regulatory agencies and the increasing of
.coal production is a long slow process, and it is
highprohibiting
productsrestrictions
and petroleumenvironmental
these d of ncoalpart
sulphur content; and
(h) The uninterrupted and adequate supply of fuel is
essential to the continued operation of the generating
development of fuel
facilities nttentities; and
supplies controlled by the
(i) In the investigation by the entities of certain
lignito deposits preliminary indications are that a
sufficient quantity of lignite exists to warranz the
construction of a lignite fired generating plant but
the information received to date requires additional
verification, and if the csLim;.tcd quantities are
reasonably confirmed, additional expenditures will be
required to obtain options, royalty contracts, etc; and
(j) The lignite dcposlts might be of adequate quantity
and acceptable quality which could be utilized with f'
moderate problv!as of combucotion and hancll.ing; should it
be determined that thn lignite exists in commercial
quantities; and
.3_
I
i
( n:; idUrutic~i r,10U be V( '11 in lltc dr.sir,ibiIity
of owniul; .:uul dL•l)osits in order io ohLain a long term
supply or in Lhe alternate, contrrictual arrangements
should be viade wiLh coal vendors who would inelicate a
reasonable savings to the parties if ownership of such
resource:; rind facili.ti.es necessary to mine and transport
the fuel can be properly financed and careful analysis
is required to determine the extent of capital funds
which would be needed to insure the dv ication of
adequate reserves for long term utilization by the
process of disbursing substantial "front end money
and other capital funds would be required or be better
expcndud for transmission, generation and transporta-
tion facilities (if given a higher priority) than
owning fuel resources; and
(1) The acquisition of fossil fuel resources at locations
other than the generating plant site will require
transportation of fuels from one or more geographical
locations in accordance with a particular state of the
art for each type of fuel whether it is solid, liquid
or.gaseous; and
(m) Until such time as there is a definite commitment
for coal or lignite (either or L..Lh) resources and the
established magnitude of fuel to be transported in any
given year it is not possible to identify with accuracy
anticipated transportation costs; and
(n) it appears that additional investigations should
be made to determine whether various types of trans-
portation facilities could be leased, thereby increasing
the maintenance artd operating expenses, or whether it
would L.: more economical to purchase such facilities;
and
(o) Nuclear generating plants both planned and under
construction have been subjected to vigorous opposition
causing substantial delays in the construction and
availability of electric energy; and
(p) 'ihe refinement, enrichment, conversion and fabrication
of nuclear fuel involves long lead time commitments
similar to developing new coal resourcev, and the cost
of one component of nuclear fuel (uranium) has almost
quadrupled in the past 2 years so that the supply of
domestic uranium is anticipated to be extremely tight
by 1980 so as to cause an increase in the price of such
fuel; however, nuclear generation may economically
supply a portion of entities' generation requirements;
and
f (q) Transmission planning studies cannot be refined
until final generation plans have been completed and
sufficient information has been assembled to enable
preliminary transmission arrangements to be developed
and additional st'_'dy is rc•nniied in connection with
such transmission plans; and
-4-
(r) Tralls,mis::oil costs involve the complllation of
II1l leai,,c! aj well ZIS the nul',lber Of skihstat]ons Which
1,fVuld bC required; rind
(s) The plaililini; of the expansioli Of electric fenCraL-
ing facilities in the iii.q nituile being considered by the
parties requires an identification of potential water
resources which Wight be utilized for plant. cooling,
the specific type of cooling; sysl:enl for which the plant
is designed dctorminin- to a large extent the cooling
requirements since the total water makeup requirements
could generally be exp,~ctcd to be between 1/2 and 1
gallon per kilowatt hour for evaporative and blowdown
losses; and
(t) The range of water utilization would also depend
upon whether the plant utilized water for iLs cooling
systems or wheLh, r dry towers were used where water is
utilized only for boiler blow-down, and the variables
involved in the utilization of cooling water requirements
indicate additional capital cost or annual operating
cost would vary so that a study is needed in order to
determine which is the most economical for the parties;
and
(u) Power flow analyses are needed in order to deter-
mine transmission requirements, and environmental and
economic considerations require the opportunities for
joint planning and coordinated development of trans-
mission with other area utilities; and
(v) The question arises whether combustion turbines should
be added so as to relieve a portion of the deficiency
in capacity and energy for the period of 1978 through
1982 even with the increasing cost and reduced availability
of natural gas and liquid petroleum fuels but it would
be feasible to further investigate to determine if the
combustion turbines could be used as the initial building
block for the installation of combined cycle generating
facilities, but the type of combustion that should be
used will vary with the amount of t_me per year that it
will operate. The approach of adding a combustion
turbine with an existing unit requires detailed analysis
so that consideration may be given to the anticipated
life of the existing equipment in connection with the
cost analysis whiCi must be developed, and it further
appears that steam pressure and temperature conditions
for existing turbines would affect the approach and
cost that would be used; and
;w) The delegation of dispatch responsibility for the
resources of the parties to a central coordination
center would be an improvement in the overall economics
of operation although local conditions such as minimum
load restrictions on units, }imitations on incomin6
transmission line or transformer capabilities, and the
need to operate generation for voltage support might
- place: singe uonstraintants on dispatching; and
j
. t,
t.
s
-5-
4
1 1
(r.) I11('Il enLiLy tai 11 fcLaivc a bC n(fil frrnu Ilie c;:pcucliturr:,
%11)i C11 r11-c to Le i!.:Irlr :ind for the ::1-rvic(-s acid work to
be pcrf,unicd undrr the provirions of thi:; conLract
since (1) each of the engineering studios are needed in
order that. :.u Lnforilied judt-,mcnt may Ile m;rdc as to the
extent Lhat Li I is entity should proceed with the proposed
joint cndcavors, and such studies Will also FJv-- this
governin}; body the informaLiutl that i.:; needed With
respect, to sou:c of it.s Own operations so inlprovci:nents
in procudi-,res wny be perfected, nn(l ('l) it is necessary
to acquirt~ and drvclop new fuel sources which may be
used and citili•zv.d for generatinn, and it is c::sential
that a fuel supply 1)c obtained and developed prior to
the determillation of the location of proposed generating
units, and (3) the construction of the interconnection
with the private utilities and the transmission lines
to be constructed are needed to provide capabilities of
exchanging electric capacity and energy between entities,
and (4) storage facilities for an emergency fuel (in
the event of natural gas curtailment) are needed, and
(5) feasibiliLy studies must be made for the purpose of
obtaining financing for some of the above mentioned
facilities; and
(y) A nationally recognized consulting engineer has
extensively studied the alternatives of independent and
joint action in obtaining generating and transmission
and developed estimates of the costs of both which show
savings rarir;ing from $56,000,000 to $1,013,000,000 over
the period from 1983-1994 due to joint efforts.
The governing body of each of the cities signatory
specifically finds:
(i) the foregoing facts are true and recognizes that a
joint effort with the .)Lher entities is the best course
of action in meet:.,g its power supply and transmission
requirements for tko future; and
(ii) that the benefits to be received by such city will
costs obligated tto be P•rY
(particularly (particularly since which
hereunder
shared by others); and
(iii) the engineering studies proposed to be made
hereunder relate to facilities which are required in
order for the electric light and power system of such
city to provide efficient service; and
(iv) the improvements proposed to be constructed or
acquired by the Agency hereunder are ner_ded to insure
that electrical energy may be made available for use
and distribution by the electric light and power system
of such e-ity and thereby provide adequate service to
the custowers of the city':. distribution system.
In the ,Waking of findings h(-rein, the parties ore setting
forth a portion of Lhi: reasons for tIto execution hereof, and the
:;ana are not Lu be conjikl(red a:: rcl)resel1C1Atl.Ol1S tfpon VIlicl,
third parties have any L11;111. to rcl~ ::ithout independent
verification.
. I i
SM:{:'I'T(1P2 1.02: The parties y, in rrcop'iol n£
the fit CLS set. fufth, believe there is it nCCd Sur iu',nictliutt.
::tlp:i t-O ll L;:~.C~l ll: ll•" ~1 l'11:1: l:t', Uf ;f ~~~1'l'I'at 1~; l'i1(1 e(I ~~(1I
under the provisions of ArLicl.c 1/~:SSa, S., os well
as LhV necessity for iiuntediaLC steps to he taken !it Lhe
devcl.opn,cnt of an adequate £url supply for the proposed
geticratinc, faciIitiCS.
SECTitI*2 1.03: The City agrees and covenants with the
. .
Agency-that Lo _Ehe exLc'nt it elriy lel;:i],y to so:
(a) The City will not hereufter make any expendittire
of funds for the purpose of culstructinl; or acquiring additional
electric generating, capabilities (including improvements to
or exLeusions of presently existing reneraling faciliLi.es
which increase the rated capacity of such existing facilities
by more than 10'%, in any two year period) other than those
generating facilities under contract for construction or
under construcLion as of the date of this Agreement, or
other improvements (not additions to the plant) which have t:he
result of increasing the rated capacity of the generating
facilities Lo such an extent within such periods, unless:
(l) it has obtained the approval of the some as a
joint project from the Governing bodies of the Agency
and the Texas Power Pool, Inc. (hereinafter called
the "Corporation"), or
(2) the governing bodies of either the Agency or the
Corporation fail to approve the same as .t joint
project for a period of. 90 days after written
notice is given to them by the City that the City
wishes to proceed with the project.
(b) The City will not hereafter make any expenditure
for the purpose of constructing or acquiring additional
transmission facilities which will interconnect with any of
the facilities of the Cities or any joint projects which are
primarily for transmitting power to Brazos or the Cities
unless:
(1) it has obtained the approval of the same as
a joint project from the governing bodies of the
Agency and the Corporation, or
(2) the governing borlics of either the Agency or the
Corporation fail to approve the same as a joint
project for a period of 90 days after written
notice is given to them by the City that the City
wishes; to proceed with the project.
(c) The City will not ni.akc any expenditure for the
acquisition of a fuel sur,,ly (other than Natural pa,;, ai.l,
diesel) for its electric generating facilities unlu:;s:
(1) it has ob-twined the approval -I. Ole same as
a joint- project from Hie, L',ovcrni.ng bodic ; of LIOU
Agency and the Corporation ar
(2) the 'overllillP hodieS of either the Ag,cney or the
Corporation fail to approve the same as a joint
project for .t period of 90 days after written
notice is riven Co them by the C;.ty Lhat the City
2 1.y :;.•,,.,,..,I u,iil, Lho proiect.
-7-
(d) The (,i Ly t)i I I not herc:tti t el* enter :i coon r1cL for
Lho purc•iu1:;r. by j j. crl c;llulc i I y or CI cct r is ClWtl',y t o 111(201
]orl l plu:; resc,rve:; ~;ilh :uty c-lit ity 01ilul- Lhall Ole Ay,ency,
1Sroz()S or Lllc CiI.1C:; 11111 C-S,:
(1) it ha:; 1'i t-st of f( , d ill wri.ti u); for it period
of ten consecuLIVu 1i.ly:. Lu I.ur~: l,:l::c :;I: Ch r_:th:tc'iI
or unerpy from the Ap. ncy, bravos or Crow 0110 ui
tilt cities (uu(1cr thk- same Le,rms and cundi.ti0us),
and such offer has noL been :lCeepteci ill writilig,
or I
(2) B1'aros al)(l Ule other cit ics and the Agency
notify Ulc City in writing;, that no capacity or
energy is ;lvailablu ill Ll,o duanLity (under the
same terlis and conditiont;) and for Lhe period Lf
time requesLed by the City.
The provisions of this paragraph (1) hav~n no application
to the purchase of capacity or energy (i) emergency
stand-by basis, or (ii) under a contract- having a duration
of less 1_11111 Lwo ycars (including; any renc•lvals thereof), or
inciricnt to the construction and
(iii) for po;cer or energy
testing of -illy facilities constructed by the Agency or its
agents, or (i.v) on the basis of economic dispatch ("economic
dispatch" means the allocaLi_on of Lhe total generation
required ,f the pocl alternate available sources in order
Lo achieve ti,e best possible pool economy consistent with
safe, effective operation. (Factors to be considered in
determining the best possi.ble economies include line losses,
generator efficiencies, fuel costs, load limits of generators,
transmission linc.load limits, purchase power costs, and
fuel, generation, and purchased power contractual obligations)]
between the Cities, the Corporation, the Agency and Brazos,
any or all, or (v) under the existing contract with Texas
Municipal Power Pool, Inc.
.(e) The City gill not hereafter enter a contract for
the sale by it of capacity or energy to an entity other than
the Agency, Brazos or the cities unless:
(1) it has first offered in writing for a period
of ten consecutive days to sell such capacity or
energy to the Agency, Brazos or to one of the
cities (under the same terms and conditions), and
such offer has not been accepted in writing, or
(2) Brazos, the Agency: and the other cities
• notify the Cil.y, in wrttil,g, that no capacity or
energy is required in th, quantity (under the same
terms and condition;,) and for the period of time
offered by the City.
The pr.ovisi.oi_ of this paragraph (n)ahaee noacyloration
to the sale of capacity or energy
stand-)y basis or (ii) on a contract. Laving a duration of
less than two years (including any renewals thereof) or
(Iii) for purchase of power incident to file construction and
testing of any facilities con--lructed by the Agency or. (iv)
s the basis of economic dispatch +.r,.cwcen the Cities, the
Corporation, the Agency and Brazos, any or all, or (v) to
customers who are not class 1 utilities (under F,P.C. guideline
execPt at isolated points, ("isolated points" means a location
striUuti.O
at which power and energy from a transmission or di
system of one eut.ity is delivered as purchased power at the
distribution sysLCn, of another entity, or to one f` its
members, suUssidinries ov customers), or (vi) to 1 Ucipal
- corporations that :re not Lhcil intarcoXivcLed with other th
utility companies or (vii) under t,
,g r Texaa Municipal Power Pool, Inc., Or (viii) ind aother b
distribution system which is owned by a CiLY operated y
the city, seperatcly and apart from the City's system.
t 4tM s j4.; C ~ "i
1'110 , ,~po::( and inleiII :f paiapraI.!i (c) is LO I,i'('vetit
Lilt. ',nlc ul SUS 10 111.' 4 ict•I I ic. cnerl,y ur' 1a1+.1L i Ly by thu (iLy
I o l rs t Ji:,n I~ -+i:.,)r , t h,~ ii l Ii r c i c i r:: or t h(' Agen(, v i f
:;ucii I A'rgy or cr)paciLy ( I ) is required lip beet the nea,l:; of
llrazo:; ko, the e i I ies and (L) may hr T,~.Ide available to thetlt.
It is noL lnLeluied to prcvcItt 1.110 :,ale of el(:cLric cnerl;y or
capoc1Ly to rcl;ular custowurc, of the Ci,Ly.
ARTICLE I1
SP:CTION 2.0.1: In connection t.! t h i is undertakings
herclink er, cacli City repre::cnL as fel laws:
(a) In its capacity as a duly incorporated city of
Texas, it is empotrured Under applicable laws to
enter into the engal;c•mcnts prescribed for it under
this at{r, ,MUIIL and to perform all obligations
which m. result therefrom and iLS governing; body
has duly nutht i•rcd execuLiou of Lhis agreement.
(b) It will timely pay to the Agency the full amount
it is required Lo pay Wider the provisions of this
contract for the services supplied by or work
performed by the Agency.
(c) That it will (i) plan, construct, maintain and
finance its electric transmission and distribution
system, and (ii) set and collect rates to customers
for electric service adequate to meet its obligations,
including those hereunder.
(d) That it will cooperate with the Agency in the per-
formance of the duties and responsibilities assigned
to the Agency by this contract.
SECTION 2.02: Agency represents to the City and agrees
with suet party chat it will do or will cause the following
to be done:
(a) prepare comprehensive plans for the generation
of capaciLy and energy and the transtaission thereof
to mutually agreed upon load centers. The planning
by the Agency shall be comprehensive in nature,
shall consider t11e suurcc-s6F fuel and water, uses
thereof, recycling, pollution sources and pollution
abatement techniques;
(b) join in the performance of planning; function,
and enter into planning ag;raemencs for such tern
and upon such conditi -)tis as may be cleaned desirable
so as to provide cooidinaLed planning on an area-
wide scale;
(c) evaluate the planning as facilities are completed;
(d) coordinate arc! IuUill t 1l" L110 dL:sign, constiucti.on
and ope- ifion of joiWL f3cilit10r ;
coordinate and mmnil:or the economic dispatching
of genul'aLing facilities;
(f) provide accounting; end cost allocation for above
activities.
Sit*a::• '
C ,
' E
A1,T1t;f.E 111
Itl ill,: 1..,wk !u 1w dclnl' Ily Lho Agc11Cy, l'.iLIIUI'
YI1 „•r is i t -z, rhr, r •nt :~l i c I,1- nitt liori zoo ;i;lont r; nr i~
under colttract with other:;, by virtu(' ol. Chis contrilet is
as follows: M
(a) Fucl development: f
Brynn I i.l"11i te: f
drilling, loh,ginb, coring, surveying, It
tVSLiIII, and ruidlysis Lu accurately I.
dcLerulisie the quality and quanLity of p
the lignite deposits; acquisition of
land or inLcresL thcrt-ILL.
,
The Ap oncy sivill. retain such geologist
or fuel consulting firm (either or both)
as in its judl;illent is required to make
appropriate det:erminatiuns (based on
such drilling;, lobs, corIngs, surveys
aII I analysis) as to wlietl . r such lignite
deposits are of commercially mineable
quality and quantity. The Agency shall
utilize bond proceeds only for the f
acquisition of land or interest therein
OS meet the criteria established by such
geologist or consultants.
The estimated budget submitted by the
Agency as guidelines for such proposed
operation being as follows:
Estimated Short Term Item Estimated Cost i
Paul Wuir Studies $ 226,500 E
.Aerial Surveying 95,000 F
Drilling and geological analyses 519,000
Land men 316,000
Lease options 40,000
Leases of land 60,000
Purchase options 25,000
Purchases of land 3,600,000
Lease conversion bonus 105,000 `
I
Geologist lease conversion fee 150,0000
Preliminary engineering studies 100,000
Environmental and air quality studies 150,000
Legal evaluation of deed, titles 50,000
Testing of cores, samples 35,000
Miscellaneous 100,000
$5,571,500
Other lignite:
drilling on exploratory basis and pre-
liminary leasing (under terms and conditions
sinlllar to tlx)se set forth with respect to Bryan
lignite) 150,000
Western coal:
negotiations and minor development expeuscs
in order to dcteio,ine availability of
coal as a fuel supply.
$ 25,000
_10- t.
(I>) hnl;invL•rir:p, SLudieS:
olijlinr l ioll t urbine::
Ev:rlu,il i,,n of ril Prrnnf
simple cycle courlnrsLion tUl-hitleS
i~~,uuer.rliv.. LyclLl Lut.,1Ju::Lio,i LuLbiu.:.
cotnbined cycle l;cncration
conbustior: turbine„ connected to
supply tr:~stc heclt to older existinl;
uniLj
110%otiaLion of firm po,aer purchase
c•onLract:: with other suppliers of
electric energy
Prepai ation of f casibi li Ly study for financiL,t;
$ 50,000
Econowic Dispatch:
Tt-.';Ls on perforwance i,( generating units of
the cities of Bryan, Trenton, Garland,.Greenville
and the Brazos Electric Power Cooperative, Inc.;
study ,f existing power pools; studies in
engineering accounting, computer analysis
on accounting criteria; operating guidelines
and person::cl.
$ 107,000
Comanche Peak Nuclear Plant:
Engineering study on feasibility of 10%
participation in the plant.
$ 50,000
Village Bend Pumped Storage:
Project invcst:ip.,ation under application hereto-
fore approved by the Federal Power Commission,
Phas6s lA and 1B only (the work prior to
Project Evaluation Report).
$ 125,000
Microwave Communications System: '
Path and site location studies and contruction
of the facilities.
$ 550,000
Transmission Plannin}; Studies:
Evaluationr of alternate transmission plans.
$ 40,000
Texas Interconnected System Studies:
Gathering of data on load flew, short circuit,
power transfer, stability, etc.
$ 5,000
Fuel StIldies:
a fuel n;ar,ai c:,cnt study,
D ~ lopnient Of
(cru,rntities i.onsumed, usage patterns etc.)
by computer analysis.
$ 10,0U0
. a
Cu:;l of tviec udie::
A dtloilod iudy of :tll cu:;l:; involved in
It1(. i-,i•ni•r. t IIPI I ;tud II;lII:n,iw;i„n ut cnp,I' y
.,nd ruor)~,Y• .
$ 4,OOu
(c) Cu nsLIII I('I ion:
lnt.rcunuccliun With private lit iliLies,
$1 • O84 , 00(1
01 iu;;er-Cr.•envil le 'I'r;tu k'l;ii,lu 1 iltu -
;IddiLiuna! runncrLi1,:t o! Greenville and G;irland
for cnttrrt;ency puww-: eiipineering and prc-
liwiu;iay cunslructiun c:,pcusc.
$1,000,000
(d) Acgitisi tiun of sLur'a);e t;tci l i Lie:; f ,r oil (un,urt;cncy
fuel supiJly) .
$ 430,000
SECTION 3.02: The amounts hereinnbove set forth are
those %ahicli tF( Agency feels are proper amounts for the
respective purposes; that the amounts shown arc' the approximate
anticipated expenditures through June, 1976.
SECTION 3.03: It shall be the duty of the Agency to
aprodct budget ,f proposed (:tpital expenditures_as
ampliTy-
may be required by it so as to insure Lhe foregoing project
is accomplished, and Lhe transfers of money from one item to
another may be made by the Agency, but no more than 25% of
the amount budgeted for one item (listed in Section 3.01) in
excess of $50,000 nor more than 50% of the amount budgeted
for one item of $50,000 or less, ;nay 11-, transferred to one
or more other items without approval of such transfer by the
weighted majority vote of the directors of the Agency as
well as a weighted majority vote of the Agency's Board as
contemplated by the Rules and Regulations of the Agency,
SECTION 3.04: Any study made, including, all preliminary
and fin-al reports, as a result of this contract shall be
made available to each city. Any facilities constructed or
acquired pursuant to this contract during their useful life,
shall be the property Of the Agency but shall be available
for use by each city, subject to a charge for maintenance
and operating expenses (based upon the percent of the capacity
u:;ed) of such facility whil. being so utilized.
Any interest in land or fuel obtained ab a result of
expenditures made pursuant to this contract shall be and
remain the property of the A);ency, and fuel shall be made
available for use in the generation of electric energy as
contemplated by the remainder of this Section.
The nv fine Bret a rCC47. that the purpose of this'
agreement is to provide for certain preliminary expenses of
the Agency with the view that the Agency will be in position
to acquire and construct (and provide fuel for) additional
Lllvct-ric gencration facilities so as Lo provide electric
energy to the cities and Brazos.
For and in consLderati,n of the agreements of the
eiLies duii ULdZUS .:voL,ilued :n Lhe ccritraers being simultaueously
executed, LIic A&ciicy has and dues hcruLy agree to deliver to
Brazos ancf the cities energy produced by Lhe electric h,eticrating
facilities that the Agency may hereatler acquire, utilizing
the fuel acquired under the pruvisio, hcecol, :,ubjcCL Lo
the limitations of this .Section.
ti
TI l~ alnnt'li of V lurtrtc cuirl,: 1~1a111• nv;lilabl(~ to et1c11 of
L]IL' eiLic; (.rue; to I',ruru:; Unllt'r tbl- C11WF ICI w(-LlLiUrl(•11) aL
Lhi, bu:: bar o1 Lhv Al',cucy'., f',c14' I':ILiIIp, i IC LIiti:JL,IIJ, 1) L'
111.11 :11uLt11l' of (''1 Iris ('11(.1.f,y I11f-':':!1111` cif !•'117ch crlll'IIF 111 r'
M I 0i II It w1 li61 11.1:; 1.1cen h,)id by the CJ li a:; 111d L'razor;, 1'cSpactiVCl.y,
as debt acrv i C(! 11;1yv1etlt
Such valve of cloctrie -,nerpv shall be deterwined on
the bns;s of eels! of e;ervice sIII(lics t.illl regard to producinp,
such energy (,IS (Iciernlitlcd by a rc'};iSterCll I)rofUSS!Uual
eng;incer c:upluyuil by the A1,cocy).
In the event the Ai;crlcy does not acquire a generating;
facility' capal,.Lu o€ uLIiizinti Lhe fuel scquired I1c17011nLlcr,
the Agency, Upon the sale of such fuel, shall credit Brazos
and each of the cities wish the proportionate share of the
receipts from such sale (hasecl upon debt service payments
made by each suet! conLractitll; hu1 ty) .
ARTICLE IV
SECTION 4.01: As used in this insLruulent, the term
"debt u-fihe ~T1;.1icy" means the principal of, interest on,
reserve fund for, and any appl.icable redemptio-i premiiml with
respect to the initial scri.es of bonds of the E,gency ki,owij
as "TEXAS 1'!UNIC1PAL POh'Ek AGENCY REAIENIIE BONDS, SERIFS
1975," dated September 15, 1975, to be authorized in a principal
amount of not Lo exceed $10,625,000. The term does not
include any bonds or other obliE,itions issued for the purpose
of refunding, cancelling, and in l.icu of such Series 1975
bonds. The parties contemplate that a new contract will be
executed in the event such Series 1975 bonds are refunded or
if additional bond obligations are :ssued by the Agency
which pledge any income, revenues or payments received from
a city by the Agency.
SECTION 4.02: (a) For and in consideration of the
undertaking OT-L-hc Agency each City agrees that it will pay
to the Agency an amount of money for the payment of the
city's part of the (1) maintenance and operating expenses of
the Agency and (2) the debt of the Agency.
(b) The amount to be paid by cacti city for the payment
of such maintenance and operating expenses shall be as
follows:
.16 Mills for cacti kilowat : hour of net energy for load
of that part icul.ar city's lslect.ric System or Systen.s
during the fiscal ye.n: of th, Aj;c1x•y. '11ie tern, "net
energy for load" shall have the meaning set forth on
F.P.C. form, 12 E-1, page 5, Schedule 1; i.e., the
system net 1;encration plus energy received from others
minus energy delivered to others. The amount due from
each city shall be divided into 12 approximately equal J
monthly payments based upon the estimated net eneri,y 1
for lo.ld. SUCII est imate to be made as follows:
on or before the first-day of each fiscal year, the
utility dircr!'ir cll. each city shall file (with the
EXeCUtive Di,L Lor of the Agency) a report containing
his estimate: u!' the net energy for load for the such
city for the fclllocJing; 24 month period rend from such
report the arith[neLic average of the particular year
shall be detvrlninLd (such report may b.: amended by the
utility dir,,'tor of a city not tm>re thor. twice in any
one fiscal year) and (2) the arithmetic averag;o of net
enerf,y for goad of enCh pnrti.-uiar city for the prccedfilp,
fiscal year of the Agency ::hc,il be calculated, and (3)
if Lhu ,cLiul,Ilc of the utility dlrcctar i.; not Liracly
. -.3-
X14. '
Iiird Ihr ;1v11 r; 1).y of nc•I. (.nc1'I,y fill lU;rd nn 1he Ili :;(!)1'i C•11
12 1xn1L11 1) e111111 nhnl I IW tired uitl i 1 ::11"11 0:1 ilo;ltc i:;
f111d hilt if Ibc c::Litn:tLe iIilc11 Ilre IIiV,IWr of the
co 1 111 1 1 n 1 1 onII hl ;1 i rlr.(I under ( I ) ;1l1d (2) ahnvc :;h;t I 1 he
11Sed ;r:; Lhc L' iucnLud Ilk' 1. cnurl•,y lur' I0,Ad. 4lit11111 LU
J,,~,, ul Lki : u' 1 i u1,;1I n: I h~11• ~•11t i~t,
I)i rector of t be A);crlcy :;11;11'. t , .lct urmi ne t Ire anount which
;;hcnrlci ll;lv(,' IWc•+1 p;rid in the 11+ •11•,lin}, fio;Cal yc;tr ;1r1d
the ;1dd1Linnal :Ili)(Mnt due s;h;llI 1+c1 bill,-11 to the city
or (':cdiL :;11;11L be ) v•n tc [Iit' city nn the 1) illint;
which ht cor;cc: llue Oct 411,C•1 15. t f t he ;t(M i l i on;l l .irlnunt
clue fl-( )III a ci ty i s tn01-c I han 5'7, of the amount paid by
the c i ty (1uri 11)11 t lie precc(li.ug year I. an M)IOLML equal to
1.0% of the :llnnunt due :;hal l he added to the statement
and ,hall ha paid by if:.
Such payments ::hall be made on or before the 15th day
of cacll uwtlLh (co;nmeiioing October 15, 1.975), and the
Agency covenants that looney received under this al-reoment
will lit! u;ed only for the purpose of paying its maintctl:tnce
and opcratin,; expenses and 0111y for itcml5 or expenses
which have hecn itrcl.udeJ in a proper budget or budget
amendmlutrt ( Luclu(l ing a tcmlpornry budget) .
7'he aurount to be paid for each kiJnwatt hour of net
energy for load shah be subjecL Co ad-jusUmenl from tiu1,! to
time in-Ole fc)11owinf; manner:
(1) It may be raised if he Agem y notifies the City
that the amount of income beiub received for the payment of
maintenance and operating expenses is not sufficient for the
purpose and that the amount being collected from each entity
contracting with the Agency is being increased proportionately;
such notice sh;1'1 show the basis of the adjustment (increase)
so as to provide not less than the amount hu,l,-,eted for such
expenses during the then fiscal year and not more than 110%
Of such budgeted amount. No raise in th< amount due front an
entity shall be effecLivc. until such entity has received 30
days notice of the revision, but a city may delay paying the
increased amount until 60 days after the receipt of such
notice of revision pr,lvided (i) it notifies the Agency in
writing of its intent 1011 so to do and (ii) pays the amount
due frlun the effective date of tile increase on such sixtieth
day.
(2) It shall he decreased 11' L]te aulount received by
the Agency for the payment of the nv3intenance and operating
expenses exceeds 175% of the amount slwwn in the annual
budget therefor (tor the then currenL fiscal year) and the
millage rate will be r,.duced so as to provide not less Lhan
the amount budgeted atinu.llly for such expenses during the
then current fiscal year and not more than 110% of such
budgeted amount,
Any :nlrplus (_t;t ao+ount in excess of 110°/ of the amount
budgeted for such expenses) shall be either:
(1) applied as a deduction from the amount due from
the City during the IluxIL tinccecdiLlg mxulth or MAULL.hs, or
(2) wainLaincd as workin}; capitol by L?*-- Agency, as
directed by the cnLities who provided Lhe funds. LI the
absence of a direction bei1.4; received floe; il•e City, money
suppiicd by tile city sha1.1 be AIIIIIAL11 ;IS 'I deduction from
the arnount due from the City. Any gtprplus which is in
excess of 1254of the :mount shown in the budgeL for wailttctlance
and operating expenses shall be rcLwtied to the entities who
supplied the funds. The credit:: or rep;lynlcnt If fund:: s11111
be given or Made in the saute prop,,tioii a:; the funds were
originally paid for such expcvr:,u;.
- V,
' 11 :;I,11 l Jtc• I lice dud / ctl 1 li.' f';<,c•)•ul.lVC 1)11'trlnr I ltc
Ap.cncy t o f,:ikc I hr ra I r.tll,11 i,)11:; tai I li rr:ll)rcl to Llto I' l V prr
Ili I i to l w c (d I c•cted for onrh I:i ltw;il I hour I I' nut cncrl',y
for load.
The pa)Inenks ro 1w Ili,ulc under this pnragi%iph (b) shrill
cease alld terlnin;tt0 tiahk.-u tlucc monthly paynunl.s 1MV0. been
made after the dcl)L of the Al;cncy is paid off, cancelled or
refunded.
(c) The amount: to be pail by a city for Llte amorLi-
zation of the debt of the Aj,,,.,ncy (herein soUtCLillies a.•alled
debt ::urvice payinent) shall he in the :imounes and be paid on
or before Cho c:~tLc shown:
(1) by the City of Bryan:
Date of_pa )y c~L Amount
9-15-76 through 8-15-77 $30,184.67
9-15-77 through 8-15-78 32,006.17
9-15-78 through 8-15-79 32,002.25
9-15-79 through 8-15-80 27,389.91
9-15-80 throu:•h 8-15-81 27,213.00
9-15-81 through 8-1"-82, 27,341.67
9-15-82 through 8-1.5-83 27,341.67
9-15-83 throut;li 8-15-84 27,213.00
9-15-84 through 8-15-85 1,740.07
$232,452.42 X 12 = $2,789,429.04
plus 19.3% of the fees of the paying agent bank (for the payment
of the principal of and interest on the bonds on the next interest
payment date) shall be paid on or before February 15 and August
15 of each year upon being invoiced by the Executive Director
of the Agency.
The foregoing payments include the city's portion of
the mon.:y required to be paid into the reserve fund in the
years 1977 through 1979 under the resolution authorizing the
issuance of the buds described in Section 4.01.
(2) by the City of Denton:
Date of payment Amount
9-15-76 through 8-15-77 $23,459.60
9-15-71 through 8-15-78 24,875.23
9-15-78 through 8-1.5-79 24.887.75
9-15-79 through 8-15-80 21,287.50
9-15-80 through 8-15-81 21,150.00
9-15-81 through 8-15-82 21,250.00
9-15-82 throuyll 8-15-83 :'.1,250.00
9-1--83 through 8-15-84 21.,150.00
9-15-84 through 8-1.5-85 10352.42
$180,662.50 x 12 = $2,167,950.00
plus 15% of the fo.,. of the paying; agent bank (for the payment
of the principal of and in4eresL on the bonds on the next iutc__ t
paymrrnt date) shall be paid on or before February 15 and August
15 of each year upon being invoiced by the Executive Director
of the Agency.
-15-
9'11c foregoing. lnzyn!rnrti include the city's porLioli of
the money required to he paid iuuo the reserve fund in the
years 1917 throuf,h 1979 under Clio resolution outhuri;IJnf; the
issuance of the hOILCIs described in 'wction 4.01.
(3) by the City cif Garland:
Date of r3 Went Amount
9-15-76 through 8-15-77 $52,080.42
9-15-77 Llirouglu 8-15-78 55,223-09
9-15-78 through 8-1.5-79 55,250.83
9-15-79 through 8-15-80 47,258.25
9-15-80 through 8-3.5-81
9-15-81 through 8-15-82 47,175.00
9-15.82 through 8-15-83 47,175.00
9-15-83 through 8-15-84 46,953.00
9-15-84 through 8-15-85 3,002.25
$401,070.84 x 12 $4,812,850.08
plus 33.3% of the fees of the paying agent bark (ior the payment
of the principal of and interest on the bonds on the next interest
navment date) shall be paid on or before February 15 and
August 15 of each year upon being invoiced by the Executive
Director of the Agency.
The foregoing payments include the city's portion of
tY.a money required to be paid into the reserve fund in the
years 1977 through 1979 under the resolution authorizing the
. issuance of the bonds described in Section 4.01.
(4) by the City of Gr::enville:
Date of payment Amount
9-15-76 through 8-15-77 $11,573.42
9-15-77 through 8-L' t 12,271.15
9-15-78 through 8-1', 3 12,277.92
9-15-79 through 8-35-80 10,501.83
9-15-80 througlu 8-15-81_ 10,434.00
9-15-81 through E-15-82 10,483.33
9-15-82 through 8-15-83 10,483.33
9-15-83 thre:cgh 8-15-84 10,434.00
9-15-84 through 8-15-85 667.17
1 $ 89,126.75 x 12 = $1,069,521.00
plus 7.4% of the fees of.the p.cving agent bank (for the
?s'. *ayment of the principal of and interest on the bonds on the
next interest payment date) shall he paid on or before
February 15 and August 15 of each year upnr,being invoiced
- n.._,,UCI-.- Director of thu 11nnn.•v
%/Y 2
o ~r'
'T
_r
I'11, fclre;,~iti, pn~n~tul: inr.ludr Ilcccil}'':; Icortioit of
t he rrLrwy rcrlu i I cd l o hL. p't; 41 into I h ' t'c:nrrvL land i n l hu
ye'l I1 ; j'II Ihrr I11 l1 1977 u11d,•r IIto 1~I:;olklLiutt ,.nlLltor iziu}, the
1JJu:1IW..e ol. thC, 1,011d:: de:;itrtbed Su 5eL'L1 11 "1.01.
Except as picvi,ded 111 ttLcHo11 4.07, the debt: service
payment:: under this contract. :;h;11 l ce,lsv and L01-H1111,lLe wiled
the &bt-.. of the Agu1u•y i:: paid, refunded, or refinanced.
( d ) Tn the ,vent. Prazos excrrists i r s option to purclise
a total tindiviel,d interest in the pt:o'ject (su as to increa:ic
the perct~nLare of oealership from TY, up Lo 40% as perulit_Lvd
i11 the Preliminary I'articilt,II ioil Ap,rce cnt), and bonds of
the Agency ire r„t ived, an a1Jju1;Llneut in the debt service
pny.0'I1L shall be reduced ill accorJ,Mce wiLli 1:: hibit A aLLached
hereto.
SI:C'f10N 4.03: Should Litt: City fail to rialce any payment
at tilt t%incs licrcin :specified, inLere:;t on such amount:s
chat1 occr.uc aL the rate of Len per centuln (10%) per annurn
from the date such payment becomes due until paid in full
with interest as herein e,locificd, in the event such
payment is not made within sixty (60) days from the date
such payment becomes due, Hie Agency may institute a proceeding
for mandamus or mandatory irl.'t;,,ction requiring the payment
of the amount due and interes thereon, such action to be
institutL,i in a court of congteLent jurisdiction.
SECTION 4.04: The payments required to be made by the
City un er tlc ~crms of this contract shall be due and
payable as herein specified, and the City shall have no
right of setoff, recoupment or counterclaim agai.nst such
payment. The Agency shall never have the right to demand
l,ayment of any obligation assumed by the City out of funds
raised or Lo be raised by taxation. Any obligations assumed
or imposed on a party hereto shall never be construed as a
debt of such party of any kind as to require it under the
Constitution and laws of this State to levy and collect
taxes to discharge such obligation, it: being expressly
understood by the parties hereto that Lhe funds required for
all payments due by City are to be collected from the sources
referred to in the next succeeding section.
SECTION 4.05: (a) The City represents and covenants
that aTI-payrneii s to be made by it hereunder shall consti-
tute "operating expenses" of its electric sysi.em wliicli
serves the inhabitants of t11e city wiLlt the effect that the
obligation to make such payments from such utility system
revenues under this contract shall be an operating exl,.nse
as defined by Article 1113 of the kcVised Civil Status,-s of
Texas, 1425, as amended.
(b) The City further agrees to fix and collet .::.n
rates and charges for such electric services to its customers
as will, in coinbit,,iLi.on %Jth any other funds legally available
and reasonably assured for the purpose, make possible the
prompt payment of all . xpens_s of oporatin,,, and mai.nt•rtining
such electric sysL'cm and all payments contracted hereunder.
SECTION 4.06. 'file Agency may pledge all or part of the
ayment s'tu'lta ref i ved from the City under Section 4.02 (c)
payment'
of this agreciaent i of the payrctent of the debt of the Agency
(as such Lersn is, oulined in Section 4.01).
SECTION 4.07: (a) The parties recognize that a city
may n`t t'i idraw-from the Agency i f Lhe S;11110 would jjnpair
clt~t:' t .1 city drt rmino it
the vbliraLicll of conl.rac..
wishes to withdraw from the Agency, so the same mn)' lie again
created under applicablu law, it :hall give nuLice LO the
-17-
2A I, try at IrI, l 'lit dny:. 11I for to i untiti},,Ited witllh'aw:Il
(l,) ;;nrll t i I h.Irat:,I I (so a:: WL Lis i Iui,,i i t Cont pact tt;tl
0111 i,,nl inns) ::l1:.i 1. havl• thu t of 10win1; cfit'cL Ilpon Lltc 1
rit-,hU: ul IJIe c i Ly I
(l) 1Ile city s11;111, Iru:n iInd atLer the tji1 lldr++t,11
(lilts sliceil 11''l ill its no t. ice, lint he Oblil',a Lcd Lo
tI tII)y J' ILVIller payir,l'ntS for %011LCll 1) r0Vi.5i.11 is
,
I11.1de in Sec 1. i0n It .0Y (b) , Lh(, ill I iritcu:utcc rtntt
01wralln)>, cxpEU:cs of the A),,cncy. I
t
The city :.hall he oliiiaLed to continue to i
Inrlice the prty i• crl t s reg11 i t ed to LL! u1.,de under the i
provi::i,uns ul Section 11 .112 (c), the debt service
paywents , provided hut,uvci, i f such wi thdrawal, is i
prior to Lhe time the debt of the ;q ency is paid,
the total aur;iuut to be paid by the withdrawing 1
City vsy be paid in a Sint;IC paytrlcnt in which
event the inLcresL on the. debt of the Agency
(wl.' It is iru:luded in the calculations set forth
irl Let iVn 4.02 (c) Iu I . of) sh:Ill be calculated to
th:: next interest paymc•IIt (late on the bonds of the
Agency, The pclytnent by such withdrawing city of that part of
the principal anxount of debt it is required to pay
plus interest to the next interest payment date l
shall extinguish all liability of such city hereunder.
The parties ! urt:her agree tl)at if such withdrawal
of a city is accomplished prior to or simultaneously
with the delivery of any bonds (other than those
described in Section 4.01) the total amount due
from the city shall he paid in 30 equal semiannual
installments (the first due within six months), on
dates established by the Agency and under such
circumstances, the total amount to be paid by the
city shall be equal to that part of the principal
amnttnt of debt the city is required to pay plus
inter,.::t at the same effective rate as borne by
the A,,-ncv's bonds then being issued.
,
(3) The city withdrawing shall retain the rights
specified ill Section 3.04.
(4) The negative covenants (as contained in Section
1.03 hereof) shall not thereafter apply to such
withdrawing city.
ARTICLE V
SF.CTI014 5.01: Each proposed annual budget of the
Agency A10 caclilroposed amendment ('.mless the Board of
DiYCCtors of the Agency determines the adoption of the
amendment is an emergency measure) shall be transmitted to
each city at least 10 days prior to the approval thereof by
the Board. A budget amendment adopted as an emergency measure
shall be immediately transmitted to the city. Any representative
of a city u"y appear before the Board of Directors of the
Agency to protest a particular budget item (its inclusion or
the amount thereof), and i.t'shall be the duty of the Board
to consider such pvotf%st, and if the same is not granted
(and the budt,et itLm '(;vised in acc•Irdance with the protest)
the Board sh,Ill spread upon its minutes the reason therefor
and supply copy of such minutes to each city. The initial
budget of the Agency, atta lled herclo, is hereby approved by
each city executing this contract, but (except as provided
in Section 5.061 it shall not hereafter be necessary for any
city to approve Lite Annnal bu,lp;ct or amcndl.,--nts thereto.
SECTION 5.02: The annual budget of the Agency shall
hercaf teryluivi: two Iu,t}Ur C.1tll);orit':;, onr_ of twicin~lttshalI n be
' for rlaLnLcttaucc un(i Clpuratiu}; cxpcu;,c,:. 1'10(1
be for Debt Survice.
Illisil,'u.ltu'c rink 1,?~s rnl III}', s•>:~Tcu~ol: :,11.111 govt 1' :Itl.
„ '•„~1'isl. t:11 I I i i n' I us11'll i It (i) ' 1'c'
bt,•i; I 'Ira' U1'i ,'1 rv i l'1 ':Ini (i i) { IlU C:II, i t rl l 1't'cT }ccl l:ulil',rt ,
~I f 1, nn111'T sl ;lnd:srd nt i oust iup, i,ract ice:; : I10kL1 l
11c inCludt'11 :ss e i,cluiill3re:; un :1 Lrli I,ruivcI r,lt,r swL
1'11C'T'('I'f, :?n
111,• 1114L11000 ll. 1'L "'i " 1'
11 the t;oV'-rnin}; bn,ly i
Ii,:4lllt t'11~111CC :,lui UI?Legal lief; c;,: )'1.11 Y~"1:1 11 fu/•'~t YnV].dCd }lOl7 C'Vl`I', 1
1111 1)V''::I CrlnL[:l l' 1 1' !
U1 t'a C'il 6 { Y <li i
this, i,ruvit,i, n :;:Intl 11L' Liiel t 10 1112 inning; with the budge L
yL'ar 1976-19:7. t
['he Daht SerViCe portion of 1.110 nnnnnl hll'lt;et shall t
1•
i.nclud: -Ill payl;lc It;; fnr tht pl-iTirl pal of and :.nLeres on
Lhe buuds i r:rnieLl by t l,c Ai,unry a+: wall pays,: 1'Its requi red ?
to ],0 el.t(Ir for tllc P',yITrk„mkd ccl'I10iEXr'OUCillu.! Vi:AeetorinfludinC
E C.; of Liss p:tyinj; 1, n[
)
the Agency (:r:; its Audi;et Officer) shall Le amount
acLU:L11y required to s:,<:et: such Vt-bt SerJLre eq !
the ensuing fiscal year and such amount shall be the amount
bud-cLed for ::u~b pug{ galas Wi thouL further action boi ng E
I
taken.
SECTION 5_0 n3: In t,e event a bud}; et for the ensuing
fisca yeai-leas ot been adopt~o~nt o hude[~ed for maintenance
of the fiscal year, 1.110 total bL'
and operating e):peuscs for the preceding, fiscal year shall
be the total amount of the temporary buclget for such purposes
for the ensuing fitical year. The temporary budget shall be
effective only utitil such time as a permanent budget has
been finally adopted and approved.
The Executive Director of the Agency shall be responsible
for the allocation for expenditure of the total amount of 1
the temporary budget until a permanent budget is adopted and
1 approved.
SECTION 5.04: A• Capital Project budget isa budget of
expels tures i.o the providing of specific projects Pt
that for the initial series of bonds all expenditures for
which provision is made in Section 3.01 shall constitute a
single capital project.
SECTION 5.05: The Agency covenants that it will operate
its f,ici )ties _11 an efficient and economical manner and
that it will follow prudent utility practices in the conduct
of its affairs.
SCC'1'I01111 5.06: The partiics hereto recognize that the
pay-me of the inaiutcnr.nce and opel-aLiili; expenses of the Agency
constitute, a first char}',c ai;ain::t the revenues of the Agency;
that it is the Agency which has the responsibility of operating
and maintaining its facilities so as to piovide adequate
service, but that the cities need a measure of protection so
as to protect its citizens and rate ;LrucLure against rapid
and unforeseen changes in the budt;ut.
Accordinl;ly, the parcius agree that:
(1) Except as provided in paragraph (3), no amendments
or amendments to the operating bud-''eL of the Agency shall be
adopfcd in .^!~:y on 1 isrrrl year which increase the estilltaLed
annual payments of it particular city by more than 20% without
the approval of the governing i,udy oL each city whose paywonrs
l the A ns shall
, Y
. ]n Milking such estilnaLc, Se
are so incre_ise1
utilize the hiF,]Ier oi (1) Lhe net energy for load of a
particular ciLy for thn preceding, 12. m 1. Tmbs r (myths
estimated net e.nerily For load fOr a 1I
prepared by the director of UL11Ltic' of I.hc> p.Irtictrl:rr city
fnr the followlni; 12 months [tho :atim;ll e required in Sort i, 1
` 4.02 (h) hereof j , and the aukNunL NO dcLei''liuud shall be
tnultiplicd by the ulilla1;e rats- Lheu ?u of :ecC (uC the Leine
of the buJF,et iontidwent) under :,CCLi011 1:.02 (b) .
' f0-
1
i s,1
f'') I;scl 111 :I yr lv i l1, ll its I/,11 u;,r:lph i.l) , r.trh brI rIIIL HL
;sur,u Lnd;,cl ul lu.l i lII crI III rII nIocI iI i uy, c>:peu:;o:: u~.ly
i ncr, ,l ,c tI) t alt ell •Il .u nt blldl,l,l, d or :,Itch I)11 r13 oa, by Iln
i1J0J 111..11 ~I III; I.',1. tl'! Ill,l,l -d 1 411-'1 'I ilk- till- pl-1r
Vc^.Ir Uithrnll Lhl prior :ll,lirl~vrli of LL )%ovcrning; body uL
C"101 city.
1 f .1 1,0i i',hL ~d t11:l_juri l y fnrt.11 in I llu idles
and Rc);uIn tion.; of thl' AI',c•ncy) rln,l ::is directors of the
Agency lippruve a hud);eLor tt bLldt:vL .u111"11docill , Lhe :.auie
s!sail be cJ:foc'.L! VC.
For the llurl,l,;;r: of this Section I.hc annual operating
bud);(-L for 19.0-1.9/0 >:h,ll I be con::idcred as l)cing vnLircly
ui,r. r 1.111}; cr:}n:ltrcr.
for I:.:silit Ull:llli'u ;111d
ARTICLE V1
SI:CTIOId 6..71: The prtrLics hcreLo recognize that the
Agency wats crC,jL.cd foi the purpo:;12 of providing; electric
enerp,y to public and pri vaLe 0111 i L i c,s on a wholesale basis;
that it is not- th0 purpose of Lht~ A);ency to usurp the powers
of the cities or Lo enLer into conq,eti.tion with them, and
that such l.mitnt:i.on to the intcut of certain provisions of
Section 4a (a) of the Act. which provided for the creation of
the Agency.
The A,;ency covenants that during the term of this
agreement it will not engage Ln any utility business other
than the generation, transmission, and sale or exchange of
electric energy to the parLic'patin); public entities (the
cities) and to private entities who are joint owners with
the Agency of an electric generating facility located within
this State.
AnTICI,Ii V11
SECTION 7.01: Subject to the third paragraph of this
Section, t[:,: obligation of each City to promptly make all
prescribed payments shall commence on the date specified in
Section 4.02 and continue to be made on"the dates therein
specified.
It is contemplated this contract will be executed by
and between the Agency and each of the Cities of Bryan,
Denton, Garland and Greenville, and thaL a similar contract
will be exeuuted between the Agency (or the Corporation, its
Agent) and the Brazos Electric Power Cooperative; that the
combined paytnenLs to the Agency by reason of such contracts
will be adequate to provide for the payment of (1) the
budgeted and anLicipat.•,i admini..rraLive, maiuLenance and
operating expenses of Llte Agency, and (2) the debt of Lhe
Agency during the time the same is outstanding.
At such time as (1) t:he Agency (ir its Agent) has
executed contract- of such import, and (2) copies theruf
have been filed with etch city, tend (3) an official of the
Agency cerLifi.cs that in his opinion such contr.,:tual obligation
meets the. regttirewr-nts of the pr0:e(1L11); scnteo, C, this
contract shall b- t"Illy opol-OLivc ;Ind ir: for(:'. When this
i in fot•:(:, the: obli.,ati.on cf
contract i s f ut l y opu•ativc any
each i i.ty r(, wii ka Lhc lulywo?lt s herr` i n proSt'r i bed :011 11I b0
absoluLe, t+ncondi.tional and snot suh_jecL LU revocation or
1.. diminution in any manner.
A city does not a:,sur.e by thr execution horeof any
obligation to h'ly any any-)ants to (lie Ap,cncy or 00101'1 other
than ns herein provided. Spec'iii•.ally, a ciLy dour not
1
1 <
1',;ia 1-;II111'f` II1(! I,:I'ti l~l atb 111 ;Illlf ;I 'llllll (llll: lilil'I I]t 11 c'1• ,'Ili icl eS,
Lhe :1111' I„1i 1141:11' ul- the Ill I dint''. I' r,i,',r;lllh hl'in); to 1',ivr
it RI11,.11 WI, II c•rn•II Ly IIINI the otII r L'util i1-1; h;IVe j11 111l'd
in Lhe L I I O it a r; I L1 Vl' I'll d L:;I VU,- .
SECTION 7.0:' Subjc•c•r to tb provision:, of Sectiotl
ti. 14 cif IiII P101; ii ii-iry 1',, icipnti(In A)',rcclncnC, thi:, coIIIract
may be ch;ln,',oll ;IIILI wadi ri I (I oill y wi t h t h ' c•on::cnt of the
J;uvcrniIW; hOdIC!, of the ci l.ic':; Of Ise;nn, 1101111m, CrcelIvL1'0.,
CrlrInn(I -LnrI the' A -ily. 5n'll I uli ric:ll ioil 111.1y Ill' r(-kjlWS 1-4241
by any of such Iulrtios., ill tahirh Cvr'nL a jnint Neetilig of
the I;ovL'lninf; hnllies or of 1110 il• dally autllorir.cd and ;lppninted
repr(xl';It rlt. ivc; .Il:a 11 IW III.'11I Plat. IL's:; thAtl f i r1 ccn (1~)
days after Yhc !'iviu); of r;LICh novice. At such jnhir. m('criDg
the Sot;)~i-:,Leal chaull'I':; ot• UtWifictlciolls rha1.1 1)11 vonSiclercd,
discussed ;nld settled. 11o such change or mollification lnay
be tn;lde o:hicll will :ifFCCL. aclvcl rely the paywCIlL when due of
all monies required Lo be p;liLl t,y A City udder Lhe terln;~ of
Lf,i , ccneract and no such ch;In);e Will. be effective which
affeeLs aIdversely or cau sl s ;l viohlI iotl of any Covenllntd
contained in the resolution or order ,uthurizing the issuance
of the A6viicy': bululs.
If for any zcasnn a City Islay desire additional studies,
services or the construcLion of any additional fncilitiel_
and same are within the legal and economic capabilities cf
the Agency, provision therefor shall be nralde by means of a
supplentent hereto, the terms of which are to be negotiated
between such City and the Agency, Nothing herein shall.
restrict the power of Lhe A);ency to enter into additional
contracts wiLll additional contracting parties provided the
revenues of this contract are not pledged or hypothecated in
any manner thereunder.
SECTION 7.03: This contract shall be subject to all
valid rules, regulations and laws applicable thereto, as
promulgated by Lhe United States of America, the State of
Texas, or any other governmental body or agency having
lawful jurisdiction or any autlioriz~d representative or
agency of any of them.
SECTION 7.04: The City agrees that the Agency or its
Agent shay lateen ~er,llirced by exisriNt, easement) have such
easements over any easements, right-of-way or property held
by such City so that the facilities and required equipment
may be appropriately provided.
SECTION 7.05: (a) If for any reason of "force majeure"
any or 011, Eiarties hereto shall be rendered unable wholly or
in part to carry out. its obligations under this agreement, ti
other than the obligation of the City Lo make the payments
required under the terms of Article IV hereof, then if such
party shall give notice and full particulars of such reac.ans
in writing; to the other party within a reasonable time after
the occurrence of the event, or cause relied on, the obli-
gation of the party givin,; :;uch notice, so far as it is
affected by such "force nLijetirc", shall be suspended durin,'
tlt continuance of the final;ility 01;;:11 clailrcli, but for no ~
Icul;er pellod :iur Illy suc:l p<iCi I I: ;.Ii,I: L L iIt iai Vrl iai i i:IlniJu
or overcnma such , 11.161 ] i.i.v t i th all reasonable disnat:ch, i•
The term "force majelu•e" cis cwploycd herein shall mean acts
of God^ strikes, Joel:-ouLa, ut other indu:;Lriul. disLurbaltces,
acts LIZ public enLmly "tech ul ILt iou$ of any kind of the E
Government of Lhe smiled States or of the State of Texas o::
any civil or military authority, inl:urrections, riots,
1a11UL'W ll;,, la,LU5lidub, L.1 f,11111111t„ ua1 L11;1llaketi, flees, httrr le nes,
u torus:;, 1.UULIJ, Wa5llULlt l;, dL•ull),h LJ, al'I o:;LS, 17C;1Ll:a1Illt; LA
government and people, civil disturbona:cs, explo3ions,
-21.- F
hJlrt1::1};r .li ;Irt•i~ltlll. In tl;lrl:;, I'slcltinci 11ipulin,:;, nr i
f1:lll;Il:; tl1 111111: IStl'11: 11111) fllliLli ~11114'i ill! :11:01`11111 hi ;111`/ I
uthti c:ltl:;c uul. n.lilly 1,iIE1i 1 1'.. Ct'lll101 u! tltr p:tFI
1,, II {11 lil.. Tt- i lu1'If'1';;IIICI~ !11111 rd th:lt. l:
lllh ;cl f:ltt^, ul of :.t i i1,cs anll Iock-ouleh:iI L he eni,Ir,4`iy
Vi t Ifin i ht! dino rvI ion i.f the p:rrLy hnviti;,, t he di fl iculty,
atlti t.lult LIIv . hove T'cyit ireuunt LI;IL .ufy "1orcC ni.ljcure" t
:;!tall be rtl,u'd1Cd 1-1i1 11 1 t1. rr;lsunrll,it: di11:ILC11 :;hall not
rctivi rc t 11 f: Pi 1:14'111011 t 1,I stI- i}:c:; nuts incl.- oil L s by accedi'I),
to Lhe denlarld of the o111'usiu}; IlaiLiis t,.,,.1 ..:,11 ::ett.letrcnL t
is ulllavurablc Lo iL ill Lllc juJ;','arnt ol. '_110 parLy LaviIII; Ihr i
difficulty.
(b) No dcu,Ligc xlia.! I 'lo rccoverahlc 1'ro:! Al;ency 1,y
reason of Lhe cau:.es Zibove mcutiurted.
SECT TON 7.06: rlny notice, request, demand, sLa ttLlent
or bi provi"JUd fu• in 1.11ili al;rccr„cnL sh,,11 be in writing
and shall be clmsidored lu have hlrcrl duly dcli.vercd when
wilt by rc',isLcrcd urcorLified ul,lil, addresseJ ;15 follclws:
Al;oncy: Texas Municipal i .I,'er Agency
Forest Park CenLcr
71.11 Bosllue Blvd.
Waco, Texas 76710
Attention: Executive Director
s
Cities: City of Bryan
P. 0. Box 1000
Bryan, Texas 71801
Attention: Mr. J. Louis Odle, City Manager
City of Denton
Civic Building
Denton, Texas 76201
Attention: Mr. Jim White, City Manager
City of GI-rland
P. 0. Box 189
Garland, Texas 75040
Attention: Mr. Charles Duckworth, City Manager
City of Greenville
P. 0. Box 1049
Greenville, Texas
Attention: Mr. Jifit Deberry, City 113nager
as the case may he, except th;1t routine communications may
be sent by ordinary ma91 aitil except Lhnt either party, by
the filing of an appropriate written norice 1-u the others,
I1:;iy specify some cW -r individuaL to whom con:tixuTications
thereafter are to b.: addressed,
SEMI JO_N 7.01: VII Agency covenant's that it will
enforce tTtc oTJIi1;.lti.on, of each Citv hereunder (as wcLl as
JI Ily obligations Curt tailied in iW!Iat. coilIr;tk! ts with additional
contracting party) a:, may be t, Iluired Lo ac: tmplisli the
purpose of this contract. FitliLr party nary onforec any
oLll.gations hereumfor owed by it by the other party.
SI~CTION 7.011: The A1;eney and each Ci tv agree that in
the c'it or &M-tult or t.hreatorted defcnl]t ' 1 the payment of
principal of ur iiiL~:rext on Lh,, debt of the Ay;ency. mly
Court of compeLetiL juristlic i0:1 Ltpull pvtLLion of th, holder:!
-22
Of 2')'7.. of tllc ill incip::l ;1jnuo11L ul thr• Ihuu out:;tandinlumds
of t I I C A)P,t•ncy ::!1.111 :i1111niVIt . it 7'ec~iver with ;inthorily to
collrct_ ;,ijd rr (•1• i O n 1 1 1-1 nnrcc:; it l - <Ito t hr 0011 of the
Aguney, enforce ;111 riyja ari:Jny, fru111 def;mIt, i1: any, by
;111y LI1-y, 01. 0 111i( i_011:11 CUnL1.1Ci ill)p 11.11 Ly, 111 n.11..ilit:; 1,,1jn.14L
under the a);rtcJu tit, cn,1,]oy ;111(1 di,cllart',c a1;vr1LS and 01111,1")Ieer,
of the AfJ'11cy, t. kL' charl,c of 010 plc,l -,ed funds on hartd :011!
u,ana~ a L I I e pro1i1-i c't:11 y a t f:1i rs of L I w lt,Cncy wi thouut Von sVnt
or hincit.:111ce I,y LIKE AJf L'11, y, The COUI-L may further vast this
TllCeiVC'1' with . .'I1 pOWur:: Troll dUt i l; f: its the court: 111ny find
necessary for +-Ile protection of the holders of the bond::.
SE(:i'lON 7.09; The :).lrties lt(•reto agree that if any of
the prow) eii one cif thin cnnl Tact Contravene or be held im"'ll it]
under the laws of L11i.; Stat_. , sane s11a11 not invalidate the
whole apj-cetnent but it shall be construed as though not
containinf; that par.tic,Aar provisi0l, and the ril;hts and
obligations of the parties shall be construed ar13 in forco
",cordingly.
SECTIOPI 7.10: This contract Shall terwinate and be of
no fore and effect ninety (90) days after the debt of the
Agency has been paid off, cancelled or refunded.
1.14 WITNESS 1d11ERE0F, the u:lrties hereto, acting under
authority of their respective governing, bodies, have caused
this contract to be duly executed in several counterparts,
each of which shall constitute an original, all as of the
day and year first above written.
CITY OF BRYAN, TEXAS TEXAS MUNICIPAL POVER AGENCY
By: By
ayor, c].Ly or Bryan, Texas President, Boar o Directors
ATTEST: ATTEST:
City ecretary, LtT o -Bryan, Secretary, Boar o Directors
Texas
(City Seal) (Agency Seal)
CITY OF DENTON, TEXAS CITY OF GARLAND, TEXAS
By: By:_ -
Mayor, City off -Denton, Texas Mayor, City o F'C,7a-r '1'ex.1s
ATTEST: ATTFST:
ctati'y , sty o~~entoti` ~'ity SccrF tarY~ +.y o}~CazTrihT-
City
Texas Texas
(City Seal) (City sc!al)
.i
'i -23-
T - l
i'iyor, ('ity oT iti..;ri,viLlc ,
'fcxa^
Al°I'E 5'1'
City Cleo k, City of Greenville
'I' is a s
(City Seal)
THE STATE OF TEXAS §
COUNTY OF BI?AZOS §
BEFU 1-1H., the undersigned authority, in and for the said
County on this day person;aly appeared MR. LLOYD JOYCE, Mayor
of the City of Bryan, 'T'exas, known to Inc to be the person
whose name is subscribed to the foregoing; instrument and known to
me to be the Mayor of the City of Bryan, Texas, and acknowledged
to me that he exvcutc, the same for the purposes and consideration
therein expresso.! and in the capacity therein stated as the act
and deed of said CITY OF BRYAN, TEXAS.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this the _ day of
September, 1915.
(Notary Seal) 1Fotary Pumi1 c, Brazos County, Texas
THE STATE OF TEXAS §
COUNTY OF DENTON §
BEFORE ME, the undersigned authority, in and for the
said County on this day personally appeared MR. TOM JESTER,
Mayor of the City of DentJn. Texas, known to me to be the
person whose naive is subscribed to the foregoing instrument
and Imown to me to be the Mayor of the City of Denton, Texas,
and acknowledged to me that ',e executed the same for the
purposes and consideration titerein expressed and in the
e.al,ae ty therein stated as the act and dyed o[ said CrrY OF
DENTON, TEXAS.
GIVEN l'D`PER 14Y II.AND A11D SEAL 01' 0"FICE this the _
day of 4apteiuber, 3975..
(Notary Seal)
Noinry iTlic, colon Cciutity, fci.15
OF I III I:A
C(l INTY OF DALLAS §
I
I)I:I (lhli III E, tIIC IIt IJ(21-siI,,Ilc-d iut.hovi t y, in :in ,l for Lhr'
soil[ ColulLy on thiI; dny porr;<nl:illy appc:lrcd MR. DON RAINIES,
h.lyor of t.11 CiLy oE: Carlarld, Texas, I<nnirn to Ill(' Lo be Lite
pcrsoil t,I:oec nrlmc Lr; stll,scrihcd to Lho fUrcl;(,iII strllleetlt.
alld h1lo%,11 to Ito 11(' I I I c it:lyc.r (if I I I o CILy U1: G:lrlalld, TIs,
and ackno; I edl,ed t:o :1w that: he oxecuted the saws for the
purpose,, and consideration therein expressed .Ind in the
ca,,.tri ty Lh(•I'cin state 1 :tS tlic act and (Iced of said CITY OF
Gi1h~'.ANU, 'f 1S?:AS.
GIVEN ,INDFR MY IIAND AND SiEAI, OF OFFTC1: this the
day of ScpLLU:her, 1" 5.
(Notary Se,,l) Notary Public, D.I11as County, Texas
THE STATE OF TEXAS §
COUNTY OF 1:1,114T §
BEFORE ME, the ull,lersi.gncd authority, in and for thL•
said County on this clay personally appeared MR. CHARLES SIVI.EY,
Mayor of the City of Greenville, Texas, kno%,m to me to be
the person whose naula is sll,,scribed to the foregoing instrumen',
and known to me to be the Mayor of the City of Greenville, Texas,
and acknowledged to me that tie executed the sable for the
purposes and consideration therein expressed and in the
capacity therein stated as the act and deed of said CITY OF
GREEEIVILI,E, TEXAS.
GIVEN UNDER MY NAND AND SEAL OF OFFICE this the
day of September, 1975.
(Notary Seal) otary Pub-lic~, Hunt County, Texas
THE STATE OF TEXAS 4
COUNTY OF §
nEFORE I•IE, the undersipned allLtiori ty, in and for the
said County on this day personally appeared.
i=resident of the Board ol'l3-i~_cctors c?-
t ie ; PICTM.-POWIiR AGENCY, known to me to b: the
person whose name sul;scribcd to Lhc foregoLnl, itistrLtmvnt
,nd knowa to me to be Lite Presid<mt of Lhe Board of Directors of
TEXAS MUNICIPAI, POWER AGENCY, inc. acknowledged to me that Ile
e:-'ecoted the same for the purposes and consideration therein
exp:ceseri and in the capacity therein sta~.Ld as the act xnd
deed of said TEXAS '1UNICIPAI, 1'0%ER AGENCY
GIVEN I)NDER MY HAND ANI) SEAL OF OFFICE. thi ' Lite
day of St.ptembcr, 1975.
(Notary Meal)
oS_
I'i'I. 110, l;l Y
F'.; i1_iitt•I I iu,l„ i I, I p,it;,
1. Yt',r', A'Livilil'•(I
lu!,!1 _ AIII-C 1, 11
raciIit.A Livity Fsiil. 1r,1 II ',I'A Isla;~ls
J tII ,!.t II1 ~ G,•,ili,.i!.5 j•/(if
d. l:I'y :ll l i'.olltt' ;ll (dl } 141~,[,t)O 4,!'(1{)
b, other' I i(Ini,C 0
.;t' 0I
c, lhrsLcrn Coal , 315
~,rllllotal _G,,/4_ ,!'t .`7'1 _1(15
2. Fngin(wr•ill!1 Siutlirs
a. Cas lurilinc:. Lil,{ir:1 9. ~,f,i00 S,. ],~,f10
b. Iconnmic Uir.1Mtc11 1U7,(I:r,l ]{1: ,/90 3,210
1 (,On
C. ClrIm he Cook 60,0(1;1 4^,500 3 Y 5(1
d. f u~lh,~d Str t]2`,,UCI'.I ]'r'l M 3,'150
r;,tl,U~til 100 )G,!,DO
C, Illcro,ravc11 `1') 001) 38 800 ] ,200
f. fransllission 5,000 4,({5p 150
g. TIS :i00
h. Fuel "anagcmr.nt 10 ON 4,700
4 0i00 :j BgO IN
i, Cost of Service
Q-3
Subtotal 5341,111)tiT911,77Q b,2t0
3. Cons_t_ruct_ion
T--j-
. IntercOnnCCt 5'11111 Tr1V1tC I,O.~n,00'I v 3.)
lltiliLics
Glillj r-Greenville I,000,COO 41Y GO 12',900
00
- - -
• C. Oil Storage Facility- ncd. 43U,UrlU 4]%, I 00 ]_2 9
Subtotal 2.5I~l,ciil0 ~o-13,420
Total Facility/Activity Est-Costs 9,?01,500 3 8,9251455 S27b,045 .
4. Cost of Financing $
a. Legal R fiscal (]b) 1 Ub,2f0 ; 106,250 S -0-
b. Capitalized Interest(c) 743,750 743,750 -0-
c. Capitalized Reserve Fd.(d) 849,`'I: ft 49,545 -0-
Subtotal 1,(.99,545 1,699,545-0-
Gr4nd Total $10,90],015 SIO,C25,000 276,045
(a) Based on revised contract prices
jbj Includes construction of facilities
e12 month- interest at 7% (approximate)
d Equal to of one average annual requir~!ment (app'
9!l 11/75
A11 t:
rdLttJ'ur1)I ,r!I I L:,wrrtr.,r
tsurrrt tw f11n.'1s 3 rr rr
I LN-14 stn. 1„r;1
,x, C~1. hW, IIC. d't, f!I'. l:.N. 1.1 •).1r__-...'
_ S S S S t S S S
I 3 3 1
Prertnwlly aut 1,,+r tar $
, .r rr; tl,''1 4 ya,Ja
Surrhrre rf .1' III 1 :7,301 51,130 57,).17 57,)('4 5), u.r t1 r,r+a
tur t.h 51 tv] Sl,` 51,-'' $1,)',/3 7'd t 5 ,T1 3
(3) N
r r t 11.1 a fir m, 1"3
total $ 1GJ1,70. C-OS 53,31 , S3. VOS 51 1: ay S1, 10.11 51,1;45 SI,INtl SI, W4 51.)M 53,3W3 0,1%;o S,').DL4
tsf1,41C Or -
1 n'r hn!P Drt '
ytaer, Itt Cu,. 1,fi'r'r 4.W$. 4,W$ 4 14,5M 1 4!%11 1.'day 4. Wj$ 4,'1'111 4,5045 4,SW$ i,:".'7
/ru (17 S .5frS .
]rV tnq 4
1,011tiea r.p. nst 4's, G'3 5'1,3.+1 S:r,1S9 45,1 -0 <5,4.10 1A 45,550 44,250 IG,2`.~ !~'"3'-t I
IPP t-,r,W
prenw4ly wt7.,r lrc-1
by Irr2
1.'lo/a1 5 102.5503 I11.5Sa3 54,65:5 S1.ffU'S S4 .l.ti'3 5.1.1405 !?.4k-3 1 D,Itlo1 '.0,/545 S0.)5a SD, ::y w.. r••'
h7 ,n'.1 01',x41 9,/'-0,f!rt
Short Tire fin.rCie) ),1LJit~J 3.273,04 1.'rti I j' 1, 1~ 3 111_,x'_`7 117 _ NO
Sho -
Total 11.36t,15C11113ar.s50St, 7.1 ,i.4 N,21,M1 ,t.IL ,13.111,21 „I U1 Gl'u 6et 0GX4 ?S0,5L0$ +".450S WA01 G0.)SC15 ,'l1.454
N 1,f{_+_11GY TO 'I Ms
IN:DS
:('71 ts.wss authDrittd $ 5 s 1 S 5 s 5 -•,1 ~.5f4
r.,,w. 2571
TPpr O;eratioa,l rlr, N. (-00 1 0) ?0.0-0 20,1(0 20,1 c') 20,OW 20,1"1 "'Iw 2Dp,DOD ?0ee, -1-ro 2 0,1t0i
T0'A Optratlott .0- _O- _0_ .D- -r- •0- .n__
Sbw'. Itn I Iz✓Klrq
lout S i5, 3003 36.0701 mm's 20.I00s nycs 2D,ODOy 2D, IOBS 20,100$ 20.r'xIS 20. 1023 ?0,1K~s 20,Cti9; 271,7M
WE [st.eese outht-efled
s S S S f t7,1M
ty TITA f 8,5703 8,603 S 1 S S 3 S.
T?Fl Operation 1 Ira. 7,400 7,4(10 7.404 7,100 1,10.0 7,40.1 7,404 7.100 7,4'.10 7.400 ?'DO 7'0 0 It,2li
WA c2ew1tit 1,020 1,020 ),0:0 1.020 I,MO 1,0}0 1,0%0 1.1'20 1,010 1,0.0 1 0. M 1,
Short Tom flaanolaq '0-'0' _a 0--._=0_..._-_0. '0__-a •0
Total s 1619205 111020 S 8.4205 8,4205 6,1203 6,420$ 8.4.o$ $.an$ 8,4NI$ 8,4305 8,4205 1,4201 IIR.14C
T►P] [apema authDrt+ed
by IVA f 6.1003 6,100 f f 1 1 1 $ 3 S f 5 S 13.(,L4
IPP] Operatlan s rac, 6,350 5,110 5,150 5,340 5.750 S,IM 5,750 6,34D 5,350 5,340 5.350 5,310 64,140
WA OgerattIm 510 SJ9 9)D 9J0 510 WD 930 970 97D 910 970 970 )1.010
ShxtTerm limalKln[ •4• -b- _0_,J~" .-D-. _•o-_ •D- -0- •__a
Total S 17,120f 17,110 S 6,3205 6,7105 6.3"O5 6,3103 6,;m1 6,1101 6.3205 6,1105 6.3tOf 6,)IOS 89,38E
Grlaad
1?Pl 6spease wwrited
" f 1 t S S f 5 f 50,500
►3r T)FA S 15,300$ 15,200 s $ $
11P1 Operettoo S rac. l7.RJ0 17,8)0 17,640 17,670 17,9:0 131140 17.R:ti1 11,830 I1.n40 11,830 p,830 ]3.840 IfiL•(jrtO
WA &?tr#t xua ?,050 ?,9A 2,050 ?,050 ?,V:7 2,0'A ?,-;,7 2.0-'0 rg'a ?,059 ?.050 ?.050 24,4-0
Short tern, f trufs4y ^_0- •0- _0_.0- _0_.__-~ .--_117_ •0' ------a _-O_~D__-Q-_
Total S 31,1COf 31,060 $ 15.65'05 15.?ZDf 1S.L%$ 35,8905 15,7371uS 15,41803 15,8973 IS." 15,8601 IS,1003 ?21,:
tretavlllr •
Tltf r.pease wtt"faed
►y WA s .3,)1+05 ).300 s f S S $ $ f S f s 1 0.600
1PPI Operation 1 Fat. t,l7J ?,110 :,I7D ?,76D 2,lIu 2,170 ?,17D tjo 7,770 2,110 2.17) ?.IGO 16,110
TWA Operatfoa Ito 4W 460 450 400 ILO CO 4W 4w 440 409 00 S,57D
Short lers Flubeia9 •0• -01, ._.~0-_".~O_~•D_,_-_0-Total s 5,9304 S,9)O s 2,601 2,6703 2,6715 2,610 2,00 ?,6201 ?,6)03 ?,()DS
2.(.)Ds 2,670$ M,1)O
r'
II!
it",{'i C 7
CX('i i'UI I'.a i S {"ICl'1{' I Y 111111101 1Yf U 1:Y '111H'
~,I f „n17~r~ A.} I r~' ATI'1) lfl AI;fNIHf
Transnission Studies Sc-pLcolbC,• it All $ 7,500
Sc ~tun!u r ti Al 1 1,OU(I
I!irro,ruvr 1"Owc!r Site Options i g0,Ci00
Poy:.r Cost Allocatil.n Study Aualu,L 2es All
]9,OU0
Luna Stur ti_;otiatiuns July 31 Ci l i us
1`.II 1,UUU
Pitts Gas Testinn July 31 All 13,200
Economic Uicpitch Phase 1 July 31 All 25,000
village (tei d H ase lA 10 000
ll
Bryan Lignite (I;escrve fund) s(ytcriher S AAll
Ti5 Research June 26 -
$9(3,700
ALLOCATION 10 MM-O lS (7)
AI-LOCAT 10;1
MEMBER
$30,904
Brazos
17,100
Bryan
13,000
Denton
30,500
6a rl a nd
6,600
Greenville
$93,700
,t
I`
~ r
E{ J
N1 ill";
ft IP.IF I.",._.l l' TIIL:Ir I'l',
r' T r r I r'1 I'1. hr ,..,E Ilrr r r:•, I'.1T !",f .M 11Y 7.:n. Sftl, 1. I.
'.},r lrr{vl 3 7 r'.rt 1 17 S 1'.'%"1 S 11,1'1 3 11.1R S 11, 1~r S 11,E 'I 3 11,Etq S 11,1`0 3 14 I'M S 14,1"0 S 11,1!41 3 Ire, I' I '
r. .,rl .IA Se,l1 2,t. ',1 l.L,~ 7,') .I,ql ,'1 7,;117 1,?.1 2.1 2. F:°7 7.110 7.!.;d, 7,''h1 7: ,r i~1 1
I, (A 1% tra l„1.i7, 1".tll(a- 1,17 f1.1 crI 71%'I 7DI h:1] 7,V 'I 9i X1 1 , 1 CXM
5vll,lrl S 17,!.'0 S 17,7'b 3 1:1 ,o'.,!r S 11,770 3 i7, Y'D S 19,'50 f 11 ,I74 S 19,1;;0 S 70,k'A S 7U,f':S9 $ 21,00 S 21,350
ErLd[Si!UD+t E1fi A'IS A!,0
Ir;ll frrl (ill Ild. U.1 S In,( 11 } 8 CrJ S L,fq } 6.0'1 S L,4J1 S S 4.r'.l3 1,r C1 S 1.1.'!) $ 4.1i 7
L+S rLnlvllYrt 11'5 !.rU I "I rl SIX; 4aa S. Cr 500 !.I,I 'J.rl :UI
l l',r llr iy l[l.,r, 5'J 5inl !"0 5'.N t~l ~;+J :bl 50.1 Y:) 5111 SDJ1 G,L
av.lx[ a,J •'..,ral r,r IJ.L'r) IU,f ':;r
1'~11ra:1 Cv ,u stl:a 1'. !r legs
(Ill r 2i0 :40 2Jn 2,1 2X 711, 2(11 7rH) ?ro OJ 700 t
f m,1 ,In•r 7,5oJ 2,'.'-1
Fin 1^w. Tray Ca It n;ti 1.1'.,,1 1,000 I,ltii1 I,G'x1 1,1 J7 l,rk'^ I,fKVI LfK'0 f.l'+tl
Iw1 ed ernrrctloa sL J1rs 7u7 ?(.U 7~1r1 71!0 XQ ?.X' 7n3 740 700 700 7PO 2C'0 7,1 1
i>:'T sh_It.s 7"1 Ir1 Y ' I"1 I'J 1^'1(':a IrI 1+'1 100 1(P) Ir) ,
GLCt,ha anJ CJ~r rt l.n !oJ 'n'-0 5rA S'.J S:w sw SW LDO L!a 5C'0 !00 SN) L,I `J
1,S'dlations 6 ad,sull ar.tl 5.670 S,C,rJ 5.t. iR 5,00) 5,111 5,Gj l. (j, K1 5,(IM 5,0'00 5,OW S,LUJ 5.000
NIS,,Ilanravs SIU31.s 7,(yl 7,n_+1 _irn,) _7,In.y 7,r.:.) _7,(+.w ~.frf:!. __~aftb. _?,(rill __~.pW _2,L ll,) 7i0_s~
: uM1tot.1 S f9 :07 S i!.`,kl S 7u.n%J f I:t ,U,q 3 11,0::9 3 1L.t~'.' 1 IG,(dJ 1 11.VQ S 15,5`4 S 13,000 S 77,Mh $ 11.000 S ;15,577 1[.
ial i_,_FS?Ri4! { "
f i,Dl All
7wl arJ flits DI spat A Ing 3 1,Ulf) S S.VX) S 1,tt4 S 1,010 3 1,LCh } I,LU7 3 1,1'10 !I.CM } I." } ).C00 S 1,4'X1 } 1,600 S 1'i,7ta
I?
I7.CILISI CT f1PEf!5[
1
lraim O"J S 4.0'10 S 5 .I 3 9,!X'6'3 9,RD3 S 9.v.) S 9,f+J0 3 M4,1 ( 9.NV S 9,x00 } 9,000 S 9,060 S 9'(0) 3 111,":41 #
011 Stminal aperatfcn ',11'0 ,_1rsnJ, I, 500 Ia5?) __1, V.) _laYlO __1,'_,41 __)15(X1 _1iSC!1 ._1;500 _11500 1 500 _.._3a,rLA
Sebtctal 3 101`,03 3 10,500 3 IU.SD) 3 1D. SW S 19.500 } 10,50 S 1D.1W S 10,507 S 10.94 $ 10.5;10 S 10,500 S IiL,( .1
1oU1 S 48.6.0 S !9.750 S 50.150 $ 19,340 f 130 S 47.UO 3 47,940 $ 47,9k9 f 16.650 3 0,959 $ <G,750 S 46.250 S tU5,75D E
At LOCATIr71110 Ni 11_05(!/)
grams ".100 s 20.170 S 20.Ura1 S 20,100 (29,10 S 70,!x,1 3 20,100 3 70.1100 00 $ 20,0(0 S 2'.4~ $ 2'.S O 3 27' _
w 7b9 ,r„?!)
PY14 7.4OD 7.600 7,1x0 7,4!X0 7,11(3 1,4'.tU 7,1 '0 7, ,
1,nlon S." 5,710 5,3'0 S111J 5,350 5,);0 5,3'43 5,110 5,050 5,)10 5,750 5,750
C4rla,J 13.83D 13,8)0 13., -j 11 ,030 17,670 MEW 1),k?0 13,830 21,110 13,030 1J.k70 11.017 Ilt,rtJ
Wela+flL 7,1)0 2,170 2,110 2.160 2.170 2,170 2,1w 2,119 71170 2,170 2.170 2,160 1Lyy1D SF
} !t%5LD
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(t 1 f,si,llmc's st ff 7 , ?II cost of living increa_.fc in Jinuary and merit
incrca -'c ill J'.lr
{10) A"-I ~,rc I'i:rlvill!l exfenws for- t%:,, 'MIS addition ur office furl,iture,
cilll.ulaturs, etc. r
(11) Assum.os decline in legal needs as organizat.i(•nal relationships are
firmed up. ~
!12) Continuing services after Lone Star negotiations. i
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(13) Possible future hearings.
(14) Alincated on 1475 energy.
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(15) llsst!mes decline in deliverability. Price based on $1.524 mml v
$.20 transiN:rldtion through August, Ulcn 1-1.90 .1 $.30 tronsp i"I"t C"n.
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(10' Gas received Lut not paid for in 1974 and 1975. i
(17) Cased cn 1974 peak lords.
(1B) As shorn in short-tern financing documents. t
(19) TWPA assumes previous costs of numbers in Octohcr.
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f.X1IIi31T Draft 12
9/1G,15
TEXAS MUNICIPAL POY,ER AGENCY
Foraarlae To Re Used In Connection With
Debt Service I'ayniL:nt AdjusUneuts - I91'dLOS -
Purchase Option
A. All funds received by Agency fran Brazos shall be immediately used
to reduce (call) outstanding Bonds of Agency
0. Adjustments to Payment of Debt Service
1. Brazos Purchases Up To An Additional 17,", of the Total Project
a. Debt service requirements are adjusted to eliminate
requirements of called Bonds.
b. New payments equal to a. times product of:
Brazos - 25.0%
Bryan - 19.3%
Denton - 15.00
Garland - 33,3%
Greenville - 7.4% -
2. Brazos Purchases Over An Additional 17% of the Total Project
a. Debt service requirements are adjusted to eliminate
requirements of called Bonds.
b. Brazos - New payments equal to a. times product of new
percentage calculated as follows:
x = % of Agency's debt requirements to be paid by
Brazos
y - % of total project owned by Brazos
z = Total % of participation desired by Brazos
in total project (both owned b contracted)
X ° (z/1-Y) - (Yl1-Y)
Example: Brazos purchases an additional 25% (owns 28% of
total project) of total project and wants total
participation to be equal to'40%
y = .28
Z = .40
x = .5556 - .3889
x = .1667
• -4
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C. Cities - Each City's mi payments are equal to a. less b, times:
Bryan - 25.7:'.
Denton - 24.Ox
Garland - 44.4%
Greenville - 9.9%
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