2010-137
ORDINANCE NO. 201 0-13 7
AN ORDINANCE OF THE CITY OF DENTON, TEXAS APPROVING AND
AUTHORIZING THE "AMENDMENT TO POWER SALES CONTRACT BETWEEN
TEXAS MUNICIPAL POWER AGENCY, CITY OF BRYAN, TEXAS, CITY OF DENTON,
TEXAS, CITY OF GARLAND, TEXAS, AND CITY OF GREENVILLE, TEXAS";
AUTHORIZING THE CITY MANAGER TO ACT ON THE CITY' S BEHALF IN
EXECUTING THE "AMENDMENT TO POWER SALES CONTRACT BETWEEN TEXAS
MUNICIPAL POWER AGENCY, CITY OF BRYAN, TEXAS, CITY OF DENTON, TEXAS,
CITY OF GARLAND, TEXAS, CITY OF GREENVILLE, TEXAS" TOGETHER WITH ANY
AND ALL NECESSARY SUPPORTING DOCUMENTS; TO TAKE SUCH OTHER AND
FURTHER ACTIONS AS ARE NECESSARY IN ORDER TO EFFECTUATE AND
FINALIZE THE AFORESAID AGREEMENT; CONDITIONING THE APPROVAL OF THIS
ORDINANCE UPON THE ACCEPTANCE AND APPROVAL BY EACH OF THE
GOVERNING BODIES OF TEXAS MUNICIPAL POWER AGENCY, AND THE CITIES OF
BRYAN, GARLAND AND GREENVILLE, TEXAS; AND TO TAKE SUCH FURTHER
ACTIONS AS ARE NECESSARY IN ORDER TO EFFECTUATE AND FINALIZE THE
AFORESAIIID AGREEMENT TO TMPA AND ITS THREE OTHER MEMBER CITIES;
AUTHORIZING THE DELIVERY OF THE AFORESAIIID AGREEMENT TO TMPA AND
ITS THREE OTHER MEMBER CITIES; AUTHORIZING THE EXPENDITURE OF ANY
FUIVDS THEREFOR; AND DECLARING AN EFFECTIVE DATE.
WHEREAS, the City of Denton, Texas is a Member City of Texas Municipal Power
Agency ("TMPA"), a Joint Powers Agency; said entity was formed by Texas Municipal Power
Agency and its Member Cities, the Cities of Bryan, Denton, Garland and Greenville, Texas on
September 1, 1976; said Power Sales Contract entered into on September 1, 1976 was amended
twice, most recently on November 5, 1997; and
WHEREAS, disputes have arisen over various issues regarding the operations of TMPA;
and in December 2009, TMPA and its four Member Cities, Bryan, Denton, Garland and
Greenville, Texas reached a global settlement regarding the disputes, and have each approved
and entered into a"Global Compromise Settlement Agreement;" which settles their differences
and disposes of numerous Civil Actions as well as numerous proceedings at the Public Utilities
Commission of Texas; and
WHEREAS, it is appropriate and in the best interests of the City, and for TMPA and the
other three TMPA Member Cities, to execute this "Amendment to Power Sales Contract between
Texas Municipal Power Agency, City of Bryan, Texas, City of Denton, Texas, City of Garland,
Texas, City of Greenville, Texas;" to reflect their mutual agreement as to future transmission
financing; and NOW THEREFORE,
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS:
SECTION 1. The recitals in the preamble are true and correct.
SECTION 2. The City Manager is hereby authorized to execute and deliver the
"Amendment to Power Sales Contract between Texas Municipal Power Agency, City of Bryan, -
City of Denton, City of Garland, City of Greenville, Texas;" a copy of which agreement is
attached hereto as Exhibit "A," incorporated herewith by reference.
SECTION 3. The City Manager is hereby authorized to execute and deliver any other
and further documents related to the said "Amendment to Power Sales Contract between Texas
Municipal Power Agency, City of Bryan, City of Denton, City of Garland, City of Greenville,
Texas" as are necessary to effectuate, finalize and deliver said Agreement.
SECTION 4. This ordinance shall be and become effective immediately upon and after
its adoption and approval; provided however, that Texas Municipal Power Agency, and the
Cities of Bryan, City of Garland, and City of Greenville have each approved said Agreement.
d ~vu,
PASSED AND APPROVED this the ~ day of 92010.
,
MÁRK A~,BLTRRŌLTGHS?,'M~Á~YŌR
;
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
~
By:
APPROVED AS TO LEGAL FORM:
ANITA BLTRGESS, CITY ATTORNEY
~
By:
_
AMENDMENT TO POWER SALES CONTRACT
BETWEEN
TEXAS MUNICIPAL POWER AGENCY
AND
CITY OF BRYAN, TEXAS
CITY OF DENTON, TEXAS
CITY OF GARLAND, TEXAS
CITY OF GREENVILLE, TEXAS
This Amendment to Power Sales Contract (this "Amendment"), made and entered into as
of Amendment Date (as hereinafter defined), by and between the Texas Municipal Power
Agency, a municipal corporation and political subdivision of the State of Texas and herein
referred to as the "Agency" and the City of Bryan, Texas, the City of Denton, Texas, the City of
Garland, Texas and the City of Greenville, Texas, each of which cities is a municipal corporation
of the State of Texas and a home rule city, and herein collectively called the "Cities" and
individually called "City."
WHEREAS, the Agency and the Cities entered into that certain Power Sales Contract
(the "Power Sales Contract") made and entered into as of the 1st day of September, 1976, which
Power Sales Contact was amended by and between the Agency and the Cities as of the 1 st day of
September, 1976 and again as of the 5th day of November, 1997 (such amendments together
with the Power Sales Contract being herein called the "Contract"); and
WHEREAS, the Agency and the Cities have agreed in the Global Compromise and
Settlement Agreement, effective December 17, 2009, to use their best efforts to implement a
transmission financing program; and
WHEREAS, the Agency and the Cities desire to amend the Contract to provide for the
creation of an electric transmission facility financing structure that will permit the Agency to
finance and/or refinance electric transmission facilities in a manner that (i) will permit the
issuance of bonds and other obligations that are secured on and after the Debt Discharge Date (as
hereinafter defined) by Agency transmission revenues and (ii) will not result in the extension of
the Contract beyond the final date all debt other than Transmission Debt as defined herein
matures, which is currently anticipated to be September 1, 2018, notwithstanding the term of
such bonds or obligations; and
WHEREAS, the Agency and the Cities mutually agree to the amendment of the Contract
for the purposes and upon the terms hereinafter provided; and
WHEREAS, the Agency has obtained the consents and given the notices required to be
obtained or given prior to entering into this Amendment; and
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WHEREAS, the "Amendment Date" shall be, assuming the approval and execution of
this Amendment by the Agency and each of the Cities, the date that this Amendment is executed
by the last party to execute this Amendment; and
WHEREAS, the modifications made by this Amendment are by their express terms
effective as of the Amendment Date and affect only bonds and other obligations that may be
issued after the Amendment Date; and
WHEREAS, as a result of the foregoing, no modification effected by this Amendment
affects, and in particular, no modification effected by this Amendment adversely affects, the
rights and interests of any of the bondholders, noteholders, insurers, credit banks and other
beneficiaries or interested persons or entities having interests in the Agency's outstanding Bonds
or Subordinated Indebtedness (collectively, the "Interested Parties") and, more specifically, no
modification effected by this Amendment adversely affects the security of the Interested Parties
by lessening the amount to be paid to the Agency by the Cities or any other person or entity
under the Contract, or by changing the source or nature of such payment; and
WHEREAS, the Cities hereby reaffirm their respective commitments to the Agency and
to the holders of the outstanding Bonds or Subordinated Indebtedness to provide the payments
required under the Contract to assure that the obligations of the Agency are timely paid in
accordance with the provisions of the Contract;
NOW, THEREFORE, in consideration of the mutual undertakings herein contained, the
Agency and each of the Cities hereby agree as follow:
ARTICLE I
Section 1.1. Section 1 of the Contract is hereby amended to read as follows:
Section 1: Term of Contract. This Contract shall become effective upon the
delivery to the Agency of the proceeds of the initial series of Bonds. Subject to
the provisions of Sections 16 and 19 hereof, this Contract shall remain in effect
for a period of thirty-five (35) years from the date hereof or until such time as all
of the Debts of the Agency shall have been paid (or provision for such payment
shall have been made), whichever is later; provided, however, that the term of any
Bonds or Subordinated Indebtedness issued after the Amendment Date and
determined by the Board at the date of its authorization to be Transmission Debt
shall not be considered in determining the term of this Contract and shall not
extend the term of this Contract, notwithstanding the stated duration of such
Transmission Debt.
Section 1.3. Section 2 of the Contract is hereby amended to add the following
definitions:
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(c) "Amendment Date" shall have the same meaning as set forth in the amendment to
this Contract that provided for the issuance of Transmission Debt.
0) "Debt Discharge Date" shall mean the date of final payment or discharge
of all Bonds and Subordinated Indebtedness other than indebtedness issued after
the Amendment Date to finance or refinance Transmission Facilities, which at the
time of its issuance is designated by the Board as Transmission Debt.
(w) "Transmission Debt" shall mean all bonds, debt or other obligations issued
by the Agency on or after the Amendment Date that are (i) made payable and
secured, effective the later of the Debt Discharge Date or the date of issuance of
such bonds, debt or other obligations, by a pledge of all or any part of the
Transmission Revenues, and not secured by any payments made to the Agency by
the Cities under this Contract, and (ii) with respect to which the Board finds that
such bonds, debt or other obligations are issued solely for the purpose of
financing the acquisition, construction, improvement, expansion, equipment,
operation or other costs of Transmission Facilities for which the Agency is
authorized by law to incur debt and/or the refinancing thereof; provided, however,
that any such bonds, debt or other obligations issued prior to the Debt Discharge
Date and designated by the Board as Transmission Debt may be issued as
Subordinated Indebtedness if the proceedings authorizing such bonds, debt or
other obligations provide that on and after the Debt Discharge Date such bonds,
debt or other obligations shall become secured by all or part of the Transmission
Revenues, and not be obligations of the System or be secured by any payments
made to the Agency by the Cities under this Contract.
(x) "Transmission Facilities" shall mean all electric transmission and/or
transformation facilities wherever located and` acquired and/or constructed and
owned by the Agency, including, without limitation, such facilities owned in fee
simple in their entirety or in an indivisible ownership interest or other ownership
interest.
(y) "Transmission Revenues" shall mean the gross revenues produced by or
otherwise allocable to the Transmission Facilities, excluding any revenues from
payments made to the Agency by the Cities under this Contract.
Section 1.4. Section 2 of the Contract is hereby amended to change the letter
designations of the definitions therein to accommodate the addition of the definitions provided in
Section 1.3 of this Amendment.
Section 1.5. Section 12(g) of the Contract is hereby amended to read as follows:
(g) No Bonds, Subordinated Indebtedness, Special Contract Obligations or
Transmission Debt shall be issued or incurred without the prior approval of the
Board of Directors of the Agency, and no Transmission Debt shall be issued or
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incurred unless the Agency shall have obtained an opinion from bond counsel,
selected by it, that the issuance of such Transmission Debt will not, in and of
itself, extend the term of this Contract, notwithstanding the stated duration of such
Transmission Debt.
Section 1.6. Section 22 of the Contract is hereby amended to read as follows:
Section 22: Dissolution of the Agency. At such time as the Debts of the Agency
have been paid or. provision made therefor pursuant to Article XI of the Bond
Resolution and all Transmission Debt has been paid or provision made therefor in
accordance with applicable law or contract, and the Agency is dissolved, each
City who has not made an election under Section 13 or withdrawn under Section
16 shall be entitled to an undivided interest in the properties of the Agency in
proportion to the amount paid to the Agency under this Contract.
ARTICLE II
Section 2.1. All other terms, provisions, conditions and obligations of the Contract shall
remain in full force and effect, and said Contract, as amended hereby, shall be construed together
as a single contractual agreement.
Section 2.2. The Amendments made hereby shall be effective upon the Amendment
Date.
[Signature page follows]
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TEXAS MUNICIPAL POWER AGENCY
By: ~
Date:
ATTEST::
CITY OF BRYAN, TEXAS
By:
Date:
ATTEST:
By:
CITY OF DENTON, TEXAS
By:
Date:
ATTEST:
By:
Page 5
TEXAS MUNICIPAL POWER AGENCY
By: _
Date:
ATTEST:
By:
CITY OF BRYAN, TEXAS
By:
Date: - 3 -
ATTEST:
By:`
CITY OF DENTON, TEXAS
By: _
Date:
ATTEST:
By:
Page 5
TEXAS MUNICIPAL POWER AGENCY
By: _
Date:
ATTEST:
By:
CITY OF BRYAN, TEXAS
By: _
Date:
ATTEST:
By:
CITY OF DENTON, TE S
By:
Date: M 2 ,
A EST:
By: AI&IA
Page 5
ATTEST:
By:
0)
ATTEST:
By:
ATTEST:
By:
CITY OF GREENVILLE, TEXAS
By: _
Date:
GEUS, ACTING ON BEHALF OF THE
CITY OF GREENVILLE PURSUANT TO
ITS CHARTER
By:
Don Bolin
Chairman, Board of Trustees of
Electric Utility Board
Date:
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CITY OF GARLAND, TEXAS
ATTEST:
By:
AU
By:
ATTEST:
By:
By: _
Date:
CITY OF GR~jEENVILLE, TEXAS
By:~ 9-( .g•Dl ►V
Date: G Z - lot o
GEUS, ACTING ON BEHALF OF THE
CITY OF GREENVILLE PURSUANT TO
ITS CH
By:
Don Bolin
Chairman, Board of Trustees of
Electric Utility Board
Date: 6-43- 1010
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