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HomeMy WebLinkAboutRES 2003-029 RESOLUTION NO. 2003-29 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF GRAPEVINE, TEXAS APPROVING AND AUTHORIZING EXECUTION OF A "SUPPLY AGREEMENT" WITH A RETAIL ELECTRIC PROVIDER, APPOINTING AUTHORIZED REPRESENTATIVE(S) AND PROVIDING AN EFFECTIVE DATE WHEREAS, the Houston-Galveston Area Council Energy Purchasing Corporation (the Corporation") is a non-profit political subdivision, as defined in Chapter 304 of the Texas Local Government Code; and, WHEREAS, the Corporation is authorized to negotiate on behalf of its members for the purchase of electricity, make contracts for the purchase of electricity, purchase electricity, and take any other action necessary to purchase electricity for use in the public facilities represented by it; and, WHEREAS, the City of Grapevine has adopted a resolution authorizing participation in the Corporation; and, WHEREAS, the Corporation has negotiated and contracted with TXU Energy as the sole Retail Electric Provider and has entered into a contract with the REP referenced in the attached Supply Agreement; and, WHEREAS, the City Of Grapevine, a Buyer, is in agreement with the REP in the attached Supply Agreement; and, WHEREAS, the Political Subdivision acknowledges that Final Pricing will be provided at the time of the execution of the Supply Agreement; and, WHEREAS, the Political Subdivision has reviewed the Supply Agreement with the selected REP (the "Supply Agreement"), a copy of which is presented with this Resolution as Exhibit "A" and is incorporated herein by reference, and wishes to enter into such agreement provided that the Final Pricing is acceptable to the City Manager or Assistant City Manager. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF GRAPEVINE, TEXAS: Section 1. That the Supply Agreement attached as Exhibit "A" made a part thereof is hereby approved and adopted. Section 2. That the City Manager or Assistant City Manager is hereby designated as "Authorized Representative", with full power and authority to execute said Supply Agreement, and take all other actions deemed necessary or appropriate to consummate the transaction authorized by this Resolution. Section 3. That this resolution shall take effect from and after the date of its passage. PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF GRAPEVINE, TEXAS on this the 2nd day of September, 2003. APPROVED: William D. Tate Mayor ATTEST: Lin a Huff *610 City Secretary APPROVED AS TO FORM: John F. Boyle, Jr. City Attorney RES. NO. 2003-29 2 EXHIBIT TO , 1P Page __L__ of , g I=xtidbit t% ixu,r, ,4 E nergy Energy Purchasing Corporation • BASE CONTRACT FOR SUPPLY OF ELECTRICITY This Base Contract for the Supply of Electricity("Base Contract");and(i)any other attachments,exhibits or appendices to this Base Contract (including Exhibit "A"), together with (ii) any.Transaction Confirmation for Supply of Electricity (Transaction Confirmation") (including,as appropriate,one or more Price Sheets)as may be hereafter agreed to(collectively the"Agreement), is entered into by and between TXU ENERGY RETAIL COMPANY LP,a Texas limited.partnership(Seller")and [BUYER'S'FPL'L *G$N E,eINSERTED HERE], a [STATE:IN IM,tl . t AL.ENTITY FORMED 11S ,11E ] tri,E;'OF,4EGAL"EN'JTI S RTED EREJ("Buyer"), and shall constitute the agreement for the supply Of electricity to each Point of Delivery designated by an Electric Service Identifier (hereinafter individually an"ESI ID"or collectively the-"ESI IDs")of Buyer set forth in Exhibit"A"attached hereto: A"Price Sheet(s)"is a document(s)containing a description of the method for determining charges payable by Buyer to Seller for electricity supplied pursuant to this Agreement for specified ESI'IDs.A condition precedent for the effectiveness of this Agreement shall be the execution of a separate Transaction Confirmation and the appropriate Price Sheet(s), and agreement by the Parties on the terms contained in Exhibit"A"to this Base Contract.Seller and Buyer may hereinafter be referred to individually as a"Party"and collectively as the"Parties". The applicable Tariff(s)for Retail Delivery Service(the"Tariff')of the appropriate transmission and distribution utility(the"TDSP")serving Buyer's Premises is incorporated herein to the same extent as if fully set forth,and the Parties acknowledge that as a matter of law they are bound by the terms and conditions of the Tariff. All capitalized terms not defined herein shall have the meaning as set forth in the Tariff. The proaforma Tariff, as adopted by the Public Utility Commission of Texas (the "PUCT"), may currently be found at the PUCT's website at www.puc.state.tx.us,as Appendix IV of the Substantive Rules Applicable to Electric Service Providers. I. SUBJECT MATTER AND QUANTITY.Seller shall sell and cause delivery of,to the Seller Point of Delivery,and Buyer shall purchase and receive, at the TDSP Point of Delivery for each ESI ID, and for use only at the associated Premise(s), all of Buyer's non-residential electricity requirements for the Premise(s). A "Premise" is a tract of land or real estate or related commonly used tracts, including buildings and other appurtenances thereon, which is listed on Exhibit"A." A Premise may have one or more TDSP Points of Delivery. "Seller Point of Delivery" herein shall mean the point where Seller's supplier's conductors are connected to the TDSP's conductors. "TDSP" herein shall mean a transmission and/or distribution provider under the jurisdiction of the Public Utility Commission of Texas ("PUCT")that owns and maintains a transmission or distribution system for the delivery of energy; including a Municipally owned utility or Rural Electric Cooperative. "TDSP Point of Delivery" herein shall mean the point where TDSP's conductors are connected to Buyer's conductors at or near Buyer's Premises. II. PERFORMANCE ASSURANCE AND CREDIT REQUIREMENTS. [This Article has been deleted intentionally.] III. TERM. The "Agreement Term"shall be the time period, as referred to in the Transaction Confirmation, during which the prices contained in the Price Sheet(s)are and'shall remain in force. IV. CALCULATION AND PAYMENT OF CHARGES. 4.1 For each Transaction Confirmation then in effect, Seller will invoice Buyer for electricity delivered to the Premise(s) during each monthly billing cycle of the Agreement Term, and for any other amounts due from Buyer to Seller hereunder in accordance with the applicable Price Sheet; provided, however, in the event Buyer's aggregated consumption under any Transaction Confirmation in any calendar month exceeds the aggregated calendar-month quantities listed in the applicable Exhibit "A-1" by more than the percentage specified in such Transaction Confirmation, Seller shall have the option to price such excess quantities at 105.0% of the then current Retail Market Price. Provided such is not the result of a force majeure event or Seller's default hereunder, if Buyer's aggregated consumption under any Transaction Confirmation in a month is less than the aggregated calendar-month quantities listed in the applicable Exhibit "A-1" by more than the percentage specified in such Transaction Confirmation, then, in addition to paying in accordance with the applicable Price Sheet for those quantities actually taken, Buyer agrees to pay Seller the positive amount, if any, calculated as follows: [(100% minus the percentage specified in such Transaction Confirmation) multiplied by (the aggregated quantities on the applicable Exhibit "A-1'j for the applicable month minus the aggregated quantities consumed by Buyer under such Transaction Confirmation during the month), the "Shortfall Quantity"] multiplied by [(the contracted price from the applicable Price Sheet) minus (95% of the then current Retail Market Price for the Shortfall Quantity)]. "Retail Market Price" for purposes of this Section 4.1 only shall be: the weighted average of the ERCOT market clearing price for energy for all congestion zones in the applicable month; plus (a) all charges associated with (i) Ancillary Services, (ii) Line Losses, (iii) Unaccounted for Energy, and (iv) ERCOT administration fees; and (b) any new charges established by the Independent System Operator that load serving Qualified Scheduling Entities are required to pay. For purposes of this paragraph 4.1,Seller reserves the right to allocate measured consumption to the calendar month for any ESI IDs not installed with an interval demand recorder("IDR"). FILENAME INSERTED HERE] CONFIDENTIAL EXHIBIT_. TO --4% Page —at._ of 4.2 In the event that an iDR must be installed at any Point of Delivery in order to provide multi-part pricing, if such IDR has not been installed prior to the commencement of the Agreement Term, Seller reserves the right to calculate prices based upon the appropriate deemed load profile(as obtained by Seller from the PUCT)until such IDR-can be installed. 4.3 To the fullest extent allowed by law,in the event,for any reason whatsoever,Seller is ever determined to be, or has been, Buyer's electricity supplier for a•period after the expiration or termination of a Transaction Confirmation, but before the beginning of a replacement Transaction Confirmation or the switch to another supplier,then Seller may charge,and Buyer agrees to pay, for all such electricity so delivered to each ESI ID during each such billing cycle, a price per kWh equivalent to, at Seller's option for each billing cycle, (i)Seller's then current"standard list price offer,"or(ii)the monthly retail market rate for the applicable ERCOT congestion zone [i.e., the product of(a) the average of the ERCOT market clearing prices of energy(adjusted to a per kWh basis)for the applicable ERCOT congestion zone for each on-peak hour of each week-day of the calendar month in which the applicable billing cycle began (provided that no market clearing price is to be valued at less than $20/MWh ($0.02/kWh) for purposes of this calculation), and (b) 130%]. 4:4 In the event that Buyer changes4any point of delivery to a different delivery service voltage level than the voltage level in place at the time the applicable Price Sheet became effective,Seller retains the right to adjust the contracted price from the applicable Price Sheet for that ESI ID(s)accordingly. Buyer will not install baseload generation to service the Premise(s)without providing Seller written notification at least 120 calendar days prior to the anticipated date that the generation will come on line. 4.5 Buyer shall pay the invoiced amount on or before the due date which shall be specified in Article II of the Transaction Confirmation,or Buyer shall notify Seller on or before such invoice due date if Buyer disputes any part of the invoice together with Buyer's reasons (however, Buyer's payment of an invoice and/or failure to dispute an invoice by the due date, in and of itself, shall not constitute a waiver by Buyer of Buyer's right to contest later the correctness of such invoice), but the undisputed portion shall remain due and payable on the due date. All past due amounts (including any disputed amounts withheld which are subsequently found to have been payable), shall accrue interest at a rate equal to(i) one percent(1%) per month, or(ii)the highest rate allowed by law, whichever is the lesser,from the date such payment was due until the same is paid. 4.6 In the event that Buyer gives notice of a disputed invoice as set forth in Section 4.5 above, the Parties shall,for a period of thirty calendar days following Seller's receipt of that notice, pursue diligent, good faith efforts to resolve the dispute. Following resolution of the dispute,any amount found payable,including interest shall be paid within thirty calendar days. 4.7 If Buyer notifies Seller in writing of a justifiable concern regarding the accuracy of an invoice hereunder, Seller shall make available to Buyer during normal business hours the records in Seller's possession reasonably necessary for Buyer to verify the accuracy of its bill. Provided, however, neither Party may request any adjustment or correction of any statement or payment unless written notice of such request for adjustment or correction is furnished within twenty-four months of the payment due date for which such adjustment or correction is requested. It is understood and agreed that information and records in Seller's possession that are provided pursuant to this section 4.7 constitute proprietary and confidential information of Seller, the release of which could hinder or harm Seller's competitive position; therefore, such information and records are not intended to constitute public information under the Texas Public Information Act and shall not be released by Buyer, unless determined otherwise by the Texas Attorney General or a court of competent jurisdiction. However, nothing in this section shall require Buyer to bring a legal challenge in any court to seek to overturn a ruling by the Texas Attorney General's Office or a court requiring disclosure pursuant to the provisions of the Public Information Statutes, but Buyer(i)shall cooperate and assist Seller in the event Seller should bring such a challenge and(ii)make no disclosure until when and if Seller's challenge has been finally denied. All information and records provided hereunder constitutes the property of Seller, and such information and records,and copies thereof, as well as all notes taken therefrom, shall be returned to Seller promptly after the resolution of any invoice accuracy concerns. 4.8 Payments may be made by check, wire transfer, direct debit or electronic data interchange (on terms reasonably acceptable to both Parties), and notwithstanding anything to the contrary contained herein, must be received by the receiving Party on or before the end of the time period specified in Article II of the Transaction Confirmation. The address to which payments are to be made shall be as set forth in the Transaction Confirmation. For Buyer to pay Seller other than by check, Buyer needs to obtain required information/agreements with Seller. 4.9 Buyer agrees that it shall abide and be bound by the Agreement through the end of the Agreement Term and shall not,during the Agreement Term, claim any right to pricing based upon the Price to Beat. "Price to Beat" shall mean a price for electricity, as determined pursuant to the Public Utility Regulatory Act, Section 39.202, charged by an affiliated retail electric provider to eligible customers. However, in the event that Buyer, as a matter of law, should ever have the right to claim Price to Beat and thereby terminates this Agreement, Buyer agrees to pay to Seller, the positive amount, if any, calculated as follows: (all quantities of electricity attributable to all Premises from the date of termination of this Agreement through the end of the Agreement Term)multiplied by(the contracted price from the applicable Price Sheet minus 95.0%of the then current retail market value for such quantities). 4.10 In the event Buyer ever takes electricity exceeding the Maximum kW for any Premise(s), each time it does so Buyer shall pay the Over Capacity Charges as stated in the applicable Price Sheet. "Maximum kW"for each Premise, if any,will be set forth on Exhibit "A",and shall be recorded at the TDSP Point of Delivery. tF E;INSERTED HERE] CONFIDENTIAL EXHIBIT...i4 fid . °q Past of S 4.11 Buyer represents and warrants that as a political subdivision of the State of Texas it is exempt from state sales taxes pursuant to section 151.309 of the Texas Tax Code. (Information pertaining to such exemption shall be provided to Seller as requested.) Therefore, Seller,to the extent that it is riot required to pay such taxes,will not flow through to Buyer the costs of such taxes hereunder. 4.12 For purposes of this Section and Sections 6.2, 6.3, 8.3 and 12.2,the current Market Value shall mean the price that Seller would reasonably be able to obtain from the sale of the unpurchased/liquidated quantities. Seller shall have a duty to use commercially reasonable efforts to obtain a commercially reasonable price for the sale of such quantities. V. METERING EQUIPMENT.The supply of electricity to Buyer at the TDSP Point(s)of Delivery shall be measured by the TDSP, or its successor, utilizing its Metering Equipment in accordance with its Tariff. Unless the accuracy of the Metering Equipment is disputed by notice given by either Party to the other,the Metering Equipment shall be deemed to be accurate. If notice is given (unless otherwise agreed), Seller shall request the TDSP to examine Metering Equipment in accordance with the Tariff. If such test by the TDSP finds that the Metering Equipment was inaccurate, suitable adjustment shall be made in the accounts rendered by Seller,and within a reasonable period following that determination,the Metering Equipment shall be re-calibrated or replaced by the TDSP or its successor. If such test finds the Metering Equipment to be accurate within the said limits,the Metering Equipment shall be deemed to be accurate and the cost of moving,testing,and replacing the Metering.Equipment shall be paid by the Party who issued the notice. If it is discovered that any reading of the Metering Equipment.or translation of the readings into charges have been incorrect, then the amount of money due to and from Seller shall be paid forthwith. If appropriate meter reading personnel cannot gain access to read the Metering Equipment, or the Metering Equipment fails to register correctly the amount of electricity supplied, or the readings are not communicated to Seller by the TDSP in time for whatever reason, Seller shall reasonably estimate the quantity of the electricity consumed.and Buyer shall pay the charges for the estimated amounts subject to any adjustments which may be necessary following the reading. Buyer shall notify Seller of any dispute or query regarding the Metering Equipment made by the TDSP. Seller is not responsible for damage to.the Metering Equipment unless caused by Seller's negligence. VI. BUYER'S ELECTRICITY NEEDS. 6.1 Both Parties will work in good faith during the Agreement Term to reasonably accommodate and assist Buyer with the management of its electricity needs at the Premises. For example, if Buyer desires to add or delete existing Premises,or to extend the Agreement Term, both Parties will work in good faith to mutually agree upon the terms and conditions that are economically viable to both Parties. However, notwithstanding the previous language, nothing contained herein shall be construed as to deny or diminish the economic benefit of this Agreement to either Party, and neither Party shall be under.any obligation whatsoever to agree to a modification that would have such result. In the event that the TDSP experiences difficulties which cause interruptions in service to Buyer,Seller will take reasonable actions in working with the TDSP and Buyer in an attempt to have service restored to the Buyer. 6.2(a)Buyer shall have the limited right to add or delete ESI ID number(s)from an Agreement without modifying the aggregated quantities of electricity set forth on the applicable Exhibit"A", so long as(i)the cumulative total quantities of electricity attributable to such additional ESI ID(s)do not exceed five percent(5.0%)of the aggregated quantities listed on such Exhibit"A"or(ii)the cumulative total quantities of electricity attributable to such deleted ESI ID(s)do not exceed five percent(5.0%)of the aggregated quantities listed on such Exhibit"A". Notwithstanding anything to the contrary contained herein, Buyer may only add or delete ESI ID number(s)associated with guard lights, lighting,and other such Premise(s)from an Agreement once per calendar month. (b)In the event that Buyer desires to add an ESI ID numbers(s)to an Agreement,it shall notify Seller in writing at least thirty(30)calendar days prior to the desired effective date of each such addition. Seller and Buyer shall agree upon the quantities of electricity that are applicable to each added.ESI ID number,and Seller will examine the request in order to determine whether such addition would result in Buyer being outside of the tolerance range set forth above. In the event that any addition(s)would have such a result,then Buyer shall be required to purchase(for the remaining Agreement Term)an additional quantity of electricity necessary to avoid such a result, at the then current market based price as reasonably determined by Seller. In such event,the applicable Exhibit"A" shall be modified to reflect the additional quantities so purchased effective as of the effective date of the requested addition,and Seller thereafter will utilize Exhibit"A"as modified in determining whether any future requests to add or delete under such Agreement would result in Buyer being outside the tolerance range set forth above. (c) In the event that Buyer desires to delete an ESI ID number(s)from an Agreement, it shall notify Seller in writing at least thirty(30) calendar days prior to the desired effective date of each such deletion, Seller and Buyer shall agree upon the quantities of electricity that are applicable to each deleted ESI ID number, and Seller will examine the request in order to determine whether such deletion would result in Buyer being outside of the tolerance range set forth above. In the event that any deletion(s)would have such a result, then Buyer shall be required to liquidate (for the remaining Agreement Term) those quantities necessary to avoid such a result(the "Liquidated Quantities"), and Buyer agrees to pay Seller the positive amount, if any, calculated as follows: the Liquidated Quantities multiplied by(the price that Buyer would have paid for the Liquidated Quantities through the end of the Agreement Term according to the applicable Price Sheet, minus ninety five percent(95%)of the then current Market Value). Buyer shall pay such amount, if any, to Seller within thirty(30)days of the date of liquidation. In such event,the applicable Exhibit"A"shall be modified to reflect the quantities so deleted effective as of the effective date of the requested deletion, and Seller thereafter will utilize Exhibit "A" as modified in determining whether any future requests to add or delete under such Agreement would result in Buyer being outside the tolerance range set forth above. (d) In the event Buyer sells or leases a particular Premise or Premises, without selling, or leasing all of the Premises, and the new owner or lessee of the applicable Premise(s) (i)is willing to sign a new contract with Seller upon virtually identical terms and conditions FILENAME INSERTED HRE) CONFIDENTIAL EXHIBIT_ TO Xit.4'07,0)--3--019 Page g of as the Agreement between Buyer and Seller, (ii)is deemed creditworthy by Seller, and (iii)the new owner or lessee and Seller can legally enter into such a contract in accordance with the rules and regulations of the PUCT and is both a government entity and participating member of the HGAC Energy Providing Corporation,then, upon final execution of the new contract by Seller and the new ' owner or lessee,the applicable Premise ESI ID numbers will be deleted from the applicable Agreement and their associated quantities eliminated from Exhibit"A" effective as of the effective date of the sale or lease, and neither Party will owe any compensation to the other. In the event that the new owner or lessee (i) is unwilling to sign a contract with SeIle upon virtually identical terms and conditions, (ii)is not reasonably deemed creditworthy by Seller,or(iii)the new owner or lessee a 1 Seller cannot legally enter into the contract,then the quantities attributable to the applicable ESI IC) numbers shall be liquidated in accordance with Section 6.2(c)above, and Exhibit"A"shall be modified to reflect such deletion of such Premise(s)and the Liquidated Quantities effective as of the Effective date of the sale or lease. In either event,Seller thereafter will utilize Exhibit"A"as modified in determining whether any future requests to add or delete under such Agreement would result in Buyer being outside the tolerance range set forth above. (e)In the event Buyer reduces, but does not eliminate,its operations at a particular Premise or Premises through the remainder of the Agreement Term, Buyer shall have the right to delete the quantities of electricity attributable to the reduction in operations at such Premise(s) from the effective date of the reduction through the end of the Agreement Term (the "Reduced Operations Liquidated Quantities")from the applicable Agreement without triggering a termination of such Agreement. If Buyer desires to exercise such right with regard to a Premise(s), Buyer shall notify Seller in writing at least thirty calendar days prior to the effective date. Upon the exercise of such right,the Parties agree to settle with regard to such Reduced Operations Liquidated Quantities as follows: (A)in the event the current Market Value of the Reduced Operations Liquidated Quantitiesis greater than the price Buyer would have paid for the Reduced Operations Liquidated Quantities as calculated on the applicable Price Sheet(the"Unpurchased Price"), then Seller shall give Buyer credit against future purchases under this Agreement in the amount equal to: the Reduced Operations Liquidated Quantities multiplied by ninety-five percent(95.0%)of(such current Market Value minus the Unpurchased Price); (B)in the event the Unpurchased Price is more than the current Market Value of the Reduced Operations Liquidated Quantities,then Buyer shall pay to Seller the amount equal to:the Reduced Operations Liquidated Quantities multiplied by one hundred five percent(105.0%)of(Unpurchased Price minus such current Market Value). Buyer shall pay such amount, if any, to Seller within thirty (30) days of the date of liquidation. Upon such liquidation,the applicable Exhibit"A"shall be modified to reflect the deletion of the liquidated quantities effective as of the effective date of the requested reduction,and Seller thereafter will utilize Exhibit"A"as modified in determining whether any future requests to add or delete under such Agreement would result in Buyer being outside the tolerance range set forth above. VII. BUYER'S REMEDIES PRIOR TO TERMINATION In the event that during the Agreement Term, Seller ever should fail to deliver sufficient quantities of electricity to the TDSP for delivery to Buyer, or fail to schedule the delivery of electricity to Buyer by the TDSP, Buyer and Seller recognize that (i) the TDSP, per the TDSP's Tariff responsibilities, nevertheless is obligated to deliver sufficient electricity to satisfy Buyer's needs and(ii)Seller shall settle with ERCOT,at no cost or expense to Buyer,with respect to the purchase of electricity to cover any such failure. VIII. TERMINATION OF AGREEMENT. 8.1 Events of Default. A material breach of this Agreement includes: (a) the failure of either Party to make any payment due to the other Party pursuant to the terms hereof; (b)the failure of a Party to comply with any other material term of this Agreement; (c)a Party becomes or declares that it is insolvent or bankrupt, or becomes or declares that it is the subject of any proceedings, or takes any action whatsoever, relating to its bankruptcy, liquidation or insolvency, or is not generally paying its debts as they become due; (d) a Party fails to comply with any federal, state or local law, regulation, rule or order that causes a material adverse effect upon this Agreement, either Party or either Party's performance of its obligations described in this Agreement; (e) if Buyer enters into another electricity supply agreement for any Premise(s)with another retail energy provider that covers any period during the Agreement Term; or.(f)if Buyer sells, leases, closes or otherwise conveys or assigns any Premises) in which the electricity sold hereunder is utilized, without the prior written consent of Seller in accordance with Sections 6.1,6.3,or 14.2 hereof. If either Party commits a material breach of this Agreement, the non-breaching Party shall give written notice to the breaching Party that describes the breach in reasonable detail ("Original Notice"). The non-breaching Party may, in its sole discretion, and without prejudice to any other rights under this Agreement,at law,or in equity,terminate this Agreement(i)thirty calendar days after providing a notice of such breach in the event the breach pertains to item(a)in this paragraph above and the breaching Party fails to cure the breach before the end of such time period, or(ii)effective immediately in the event the breach pertains to items(c), (e), or(f)in this paragraph above,or(iii)thirty calendar days after providing a notice of such breach if the breaching Party fails to cure any breach other than one related to(a), (c), (e), (f), or(g) above(the"Early Termination Date"). 8.2. Remedies Upon Termination. (a) If Seller terminates this Agreement due to a material breach by Buyer as described in this Article VIII,Seller shall transfer Buyer to the POLR. Upon termination of this Agreement by Buyer due to a material breach of Seller,Buyer shall have the right to select any other REP as its electricity provider. (b) Pursuant to the revised PUCT rules that forbid a retail electric provided from switching a delinquent paying customer to the POLR and notwithstanding anything in the Agreement to the contrary,Seller shall have the right to order the TDSP to disconnect electric service to Buyer's Premise(s) if the Agreement is terminated pursuant to item (a) in Section 8.1 (with the requisite notice and opportunity to cure)due to a material breach of Buyer in failing to make payment due to Seller. However,Seller shall not have the right to order the TDSP to disconnect electric service (i) for the non-payment of amounts that are subject to a bona fide dispute under the Agreement, (ii)prior to termination of the Agreement or(iii)for a termination of the Agreement due to a material breach reason other than non-payment. tE1t NAME INSERTED HERE] CONFIDENTIAL EXHIBIT— A�3- �. TO Page _. of . 8.3 Calculation of Seller's Damages. In the event that this Agreement is terminated by Seller pursuant to Section 8.1,the Parties agree, that in addition to all amounts Buyer may owe Seller prior to the termination, Seller's damages shall be the positive amount, if any calculated as follows: (all remaining unpurchased quantities of electricity reflected on Exhibit"A"for all ESI IDs through the end of the Agreement Term)multiplied by(the price that Buyer would have paid for the unpurchased quantities through the end of the Agreement Term according to the applicable Puce Sheet, minus the current Market Value for the unpurchased quantities at the time of termination); plus (all reasonable direct costs and expenses incurred by Seller). Such amount shall be immediately due and payable within thirty calendar days following such termination:.The current Market Value in this instance shall mean the price that Seller would reasonably be able to obtain from a bona-fide third party if entering into a contract with another customer with similar pricing factors as Buyer for the unpurchased quantities, and for the remaining term after the Early Termination Date through the end of the Agreement Term. Seller shall have a duty to use commercially reasonable efforts to mitigate its damages. . 8.4 Calculation of Buyer's Damages. In the event that this Agreement is terminated by Buyer pursuant to Section 8.1,the Parties agree, that in addition to all amounts Seller may owe Buyer prior to the termination, Buyer's damages shall be the positive amount, if any calculated as follows: (all remaining unpurchased quantities of electricity reflected on Exhibit"A"for all ESI IDs through the end of the Agreement Term) multiplied by (the current retail market cost for the unpurchased quantities at the time of termination, minus the price that Buyer would have paid for the unpurchased quantities through the end of the Agreement Term according to the applicable Price Sheet);plus (all reasonable direct costs and expenses incurred by Buyer); minus all amounts Buyer may owe Seller for electricity . consumed by Buyer prior to the Early Termination Date. Such amount shall be immediately due and payable within thirty calendar days following such termination.The current retail market cost in this instance shall mean the price Buyer would have to pay if entering into a commercially competitive contract with another REP for the same quantities and ESI IDs, and for the remaining term after the Early Termination.Date through the end of the Agreement Term. The price offered by the POLR,or any REP's standard list price offer,shall not be used to calculate Buyer's damages. Buyer shall have a duty to use commercially reasonable efforts to mitigate its damages. 8.5 Non-appropriation. Buyer and Seller agree that in the event that Buyer is not able to allot or appropriate sufficient funds, for Buyer's fiscal year(s) subsequent to the initial fiscal year during the term of this Agreement, to continue the purchase of the total. quantity of electricity covered by the Agreement and has no legally available funds for the purchase of services to perform functions similar to those performed under this Agreement,Buyer may terminate this Agreement at the end of Buyer's then current fiscal year by giving ninety(90)days written notice to Seller and enclosing therewith a sworn statement that the foregoing conditions exist. In this sole event,Buyer shall not be obligated to make contract payments beyond the end of the then current fiscal year. Furthermore, Buyer covenants and represents to Seller that: (a) Buyer has budgeted and has available for the current fiscal year sufficient funds to comply with its obligations under this Agreement; (b) There are no circumstances presently affecting Buyer that could reasonably be expected to adversely affect its ability to budget funds for the payment of all sums due under this Agreement; (c) Buyer believes that funds can be obtained in amounts sufficient to make all contract payments during the full term of this Agreement and intends to make all required contract payments for the full term of this Agreement; (d) Buyer covenants that it will do all things within its power to obtain, maintain and properly request and pursue funds from which contract payments may be made, specifically including in its annual budget requests amounts sufficient to make contract payments for the full term of this Agreement; (e) Buyer will not give priority in the appropriation of funds for the acquisition or use of additional energy services; (f) If any funds are appropriated for electricity costs, such funds shall be applied first to the cost of electricity to be provided pursuant to this Agreement and that any such funds shall not be used to pay for electric power from any other electric power provider for the accounts covered in this Agreement;and (g) Buyer agrees to notify Seller in writing of such non-appropriation at the earliest practicable time subsequent to the failure to appropriate. As of the termination date under this Section 8.5, Seller shall have no further duty to supply electricity to Buyer and shall move service for Buyer's Premises to the POLR on the date of termination for non-appropriation. IX. FORCE MAJEURE. If either Party is unable to perform its obligations, in whole or in part, due to an event of force majeure as defined herein, then the obligations of the affected Party (other than the obligations to pay any amounts arising prior to the force majeure event)shall be suspended to the extent made necessary by such event. The term "Force Majeure" shall mean any act or event that is beyond the claiming Party's control (and which could not be reasonably anticipated and prevented through the use of reasonable measures), including, without limitation,the failure of the TDSP to receive,transport deliver, or otherwise perform, unless due to the failure of the Party claiming Force Majeure to perform such Parry's obligations hereunder,and an event of Force Majeure of Seller's suppliers.The Party suffering the event of Force Majeure shall give written notice of such event of Force Majeure in reasonably full particulars to the other Party, as soon as reasonably possible. Any such event of Force Majeure shall, so far as possible, be remedied with all reasonable dispatch. It is understood and agreed that the settlement of strikes or lockouts will be entirely within the discretion of the Party having the difficulty, and that the above requirement of the use of diligence in restoring normal operating conditions will not require the settlement of strikes or lockouts by acceding to the terms of the opposing party when such course is inadvisable in the discretion of the Party having the difficulty. Neither financial distress nor the inability of either Party to make a profit or avoid.a financial loss shall be deemed a Force Majeure event, nor shall(i)changes in the market prices of fuel, energy,or electricity, or(ii)a Party's financial inability to perform its obligations under this Agreement,constitute an event of Force Majeure hereunder. X. WARRANTIES AND LIMITATIONS OF LIABILITIES. [FiL NAMPliggRTEb fiERE] CONFIDENTIAL • EXHIBIT_.I TO Page of 4' 10.1 Seller hereby warrants to Buyer that at the time of delivery of electricity hereunder it will have good title and/or the right to sell such electricity,and that such electricity will be free and clear of all liens and adverse claims.Title will pass to Buyer at the TDSP Point of Delivery. EXCEPT AS PROVIDED FOR IN THE FIRST SENTENCE OF THIS PARAGRAPH, SELLER EXPRESSLY DISCLAIMS ' AND MAKES NO WARRANTIES, WHETHER WRITTEN OR VERBAL, WHETHER EXPRESS, IMPLIED, OR STATUTORY, INCLUDING, WITHOUT LIMITATION, ANY EXPRESS, IMPLIED, OR STATUTORY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. 10.2 UNLESS OTHERWISE EXPRESSLY PROVIDED.HEREIN, ANY LIABILITY UNDER THIS AGREEMENT WILL BE LIMITED TO DIRECT ACTUAL DAMAGES AS THE SOLE AND EXCLUSIVE REMEDY,AND ALL OTHER REMEDIES OR DAMAGES AT LAW OR IN EQUITY ARE WAIVED. NEITHER PARTY WILL BE LIABLE FOR CONSEQUENTIAL, INCIDENTAL, SPECIAL, PUNITIVE, EXEMPLARY OR INDIRECT DAMAGES, INCLUDING LOST PROFITS OR OTHER BUSINESS INTERRUPTION DAMAGES, WHETHER IN TORT OR CONTRACT, UNDER ANY INDEMNITY PROVISIONS OR OTHERWISE IN CONNECTION WITH THIS AGREEMENT.. THE LIMITATIONS IMPOSED ON REMEDIES AND DAMAGE MEASUREMENT WILL BE WITHOUT REGARD TO CAUSE, INCLUDING NEGLIGENCE OF ANY PARTY,WHETHER SOLE,JOINT,CONCURRENT,ACTIVE OR.PASSIVE;PROVIDED NO SUCH LIMITATION SHALL APPLY TO DAMAGES RESULTING FROM THE WILLFUL MISCONDUCT OR GROSS NEGLIGENCE OF ANY PARTY. Xl. NOTICES. All notices required or permitted under this Agreement shall be in writing and shall be deemed to be delivered when deposited in the United States mail (first class as to all notices other than disconnection, termination and/or material breach notices, and registered or certified as to all disconnection,termination and/or material breach notices), postage prepaid,when deposited with an overnight delivery service, prepaid to the applicable Buyer's address shown in the Transaction Confirmation, and Seller's address as shown in the Transaction Confirmation, or to such address as either Party may from time to time designate as the address, or in the case of hand delivery,when delivered to a representative of either Party by a representative of the other Party. XII. APPLICABLE LAW AND REGULATIONS. 12.1 This Agreement is subject to all applicable laws, regulations,rules and orders,except both Parties agree that it is their intention to agree to terms and conditions different from those set forth in the"Customer Protection Rules for Retail Electric Service"as amended, or as may be amended in the future(the "Customer Rules")currently beginning with Section 25.471 of the PUCT's Substantive Rules Applicable to Electric Service Providers. In the event that there is any conflict between the terms contained in this Agreement and the Customer Rules, this Agreement shall control. The Parties expressly acknowledge that certain terms and Conditions addressed in the Customer Rules may not be provided for or referred to in this Agreement, and, in such event, it is the intent of the Parties that such terms and conditions are not applicable to the Parties. 12.2 In the event a judicial decision, order, new law or regulation, or a change in any law or regulation, requires a change in the method by which prices are calculated under this Agreement,or materially and directly affects a Party's ability to perform its obligations hereunder, then the Party that is negatively affected shall have the right to notify the other Party, within thirty calendar days after becoming aware of such detrimental change. The Parties shall use their best efforts to negotiate a modification to the terms of this Agreement so as to mitigate the impact of the event. If, after twenty calendar days beyond the date of notice, the Parties have been unable to negotiate a mutually satisfactory modification to the terms of this Agreement,either Party shall have the right to terminate this . Agreement upon ten calendar days prior written notice to the other Party. If such right to terminate is not exercised within forty-five calendar days after the date of the original notice hereunder,then the right to terminate this Agreement shall be waived with respect to the particular event. In the event of a termination pursuant to this Section 12.2,the Parties agree to settle as follows: (a) in the event the current Market Value of all remaining quantities of electricity reflected on Exhibit"A"after such termination date through the end of the Agreement Term("the Liquidated Quantities"), as reasonably determined by Seller, is greater than the price Buyer would have paid for the Liquidated Quantities as calculated on the applicable Price Sheet(the"Unpurchased Price"),then Seller shall pay to Buyer the amount equal to: the Liquidated Quantities multiplied by (such current Market Value minus the Unpurchased Price); (b) in the event the Unpurchased Price is more than the current Market Value of the Liquidated Quantities, as reasonably determined by Seller, then Buyer shall pay to Seller the amount equal to: the Liquidated Quantities multiplied by (the Unpurchased Price minus such current Market Value). 12.3 Seller agrees to maintain all necessary certifications and comply with all necessary requirements in order to maintain its status as an authorized REP. 12.4 In the event Buyer utilizes, under the provisions of Article IX,Article XII, or in any other manner, its inherent powers as a political subdivision of the State of Texas in order to circumvent in any way the terms and provisions of this Agreement or the intent of this Agreement,it shall be responsible for contract damages caused by such action. XIII.RESPONSIBILITY. 13.1. Buyer assumes full responsibility for electric energy on Buyer's side of the TOSP Point of Delivery, and agrees, to the fullest extent allowed by law, to and shall hold harmless Seller, its parent company and all of its affiliates, and all of their respective officers, directors, shareholders, associates, employees, servants, and agents(hereinafter collectively referred to as"Seller Group"),from and against all claims, losses, expenses, damages, demands, judgments, causes of action, and suits of any kind (hereinafter collectively referred to"Claims"), including Claims for personal injury, death, or damages to property,occurring on Buyer's side of the TDSP Point of Delivery,arising out of or related to the electric power and energy and/or Buyer's performance under this Agreement. LFILENAmEiNtErMilettEl CONFIDENTIAL EXHIBIT_A TO Page 13.2 Seller assumes full responsibility for electric energy on Seller's side of the Seller Point of Delivery, and agrees to and shall hold harmless Buyer, its officials, associates,employees,servants, and agents(hereinafter collectively referred to as"Buyer Group"), from and against all Claims,including Claims for personal injury,death,or damages to property occurring on Seller's side of the Seller Point of Delivery,arising out of or related to the electric power and energy and/or Seller's performance under the Agreement. . XIV. MISCELLANEOUS. 14.1 Choice of Law/Venue.THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS WITHOUT GIVING EFFECT TO ANY CONFLICT OF LAWS PRINCIPLES WHICH OTHERWISE MIGHT BE APPLICABLE.THE PARTIES RECOGNIZE THAT THIS AGREEMENT IS PERFORMABLE IN PART IN DALLAS COUNTY. 14.2 Assignment. In the event that Buyer conveys legal title to all of the Premises to the same entity, Buyer may request from Seller the right to assign its rights and obligations under the Agreement to the new owner of the Premises,and in such event, Seller shall not • unreasonably withhold its consent.Any purported assignment without Seller's prior written consent shall be null and void. Buyer shall not have any right whatsoever to assign this Agreement to any party that is not the owner of all of the Premises, and any purported assignment shall be null and void. Seller may not assign this Agreement to another party, without the prior written consent of Buyer, which consent shall not be unreasonably withheld. Any purported assignment without Buyer's prior written consent shall be null and void.This Agreement shall inure to and be binding upon the Parties hereto,and their respective successors and assigns. 14.3 Entirety of Agreement. It is the intention of the Parties that the Agreement shall contain all terms, conditions, and protections in any way related to, or arising out of, the sale and purchase of the electricity, and supersedes all prior agreements, whether written or oral.This Agreement may not be modified or amended except in writing,duly executed by the Parties hereto. 14.4 Counterparts. This Agreement may be executed in multiple original counterparts, all of which shall constitute one and the same Agreement. 14.5 Duty of Good Faith. Both Parties shall have a duty of good faith and fair dealing with regard to this Agreement 14.6 Waiver of Rights. A waiver by either Party of any breach of this Agreement, or the failure of either Party to enforce any of the terms and provisions of this Agreement,will not in any way affect, limit or waive that Party's right to subsequently enforce and compel strict compliance with the same or other terms or provisions of this Agreement.Except to the extent necessary to enforce Seller's rights under this Agreement, nothing in this Agreement shall constitute or be interpreted to constitute a waiver of Buyer's statutory and common-law immunity defenses, including sovereign and/or governmental immunity and qualified and/or official immunity; it being intended that such immunities shall in all respects(except as provided above)be preserved. 14.7 Third Party Rights. Nothing in this Agreement shall create, or be construed as creating, any express or implied rights in any person or entity other than the Parties. 14.8 Survival. No termination or cancellation of this Agreement will relieve either Party of any obligations under this Agreement that by their nature survive such termination or cancellation; including:but not limited to,all warranties,obligations to hold harmless,obligations to pay for electricity taken,and obligations for any breaches of contract. 14.9 Further Assurances. Buyer and Seller agree to provide such information,execute and deliver any instruments and documents and to take such other actions as may be necessary or reasonably requested by the other Party which are not inconsistent with the provisions of this Agreement and which do not involve the assumptions of obligations other than those provided for in this Agreement,in order to give full effect to this Agreement and to carry out the intent of this Agreement. 14.10 Confidentiality. Seller acknowledges that Buyer is a governmental body that is subject to public information laws, including Chapter 552 of the Texas Government Code, which requires Buyer to release any information that is defined as or deemed to be public (the"Public Information Statutes"). Subject to any Public Information Statute or related order,rule or regulation requiring disclosure, Buyer agrees to keep all terms and provisions of this Agreement, and any information and records in Seller's possession that are provided under this Agreement, confidential and not to disclose the terms of the same to any third parties without the prior written consent of Seller. It is understood and agreed that the foregoing constitutes proprietary and confidential information of Seller, the release of which could hinder or harm Seller's competitive position, and therefore is not intended to constitute public information under the Texas Public Information Act and shall not be released by Buyer, unless determined otherwise by the Texas Attorney General or a court of competent jurisdiction. However, nothing in this section shall require Buyer to bring a legal challenge in any court to seek to overturn a ruling by the Texas Attorney General's Office or a court requiring disclosure pursuant to the provisions of the Public Information Statutes, but Buyer(i)shall cooperate and assist Seller in the event Seller should bring such a challenge and (ii)make no disclosure until when and if Seller's challenge has been finally denied. 14.11 Forward Contract. This Agreement and the transactions hereunder will constitute "forward contracts" as defined in Section 101(25) of the U. S. Bankruptcy Code ("Bankruptcy Code"). The Parties agree that (I) Seller is a "forward contract merchant" as defined in Section 101(26)of the Bankruptcy Code, (ii)the termination rights of the Parties will constitute contractual rights to liquidate •transactions, (iii)any payment related hereto will constitute a"settlement payment"as defined in Section 101 (51A)of the Bankruptcy Code,and(iv)Sections 362,546,553,556,and 560 of the Bankruptcy Code shall apply to the Parties. • (FILENAME INSEa:retr EREJ CONFIDENTIAL EXHIBIT TO 44iale-,"*". • Page of 14.12Authonzation. At such time as a Transaction Confirmation [including applicable Price Sheet(s)] are executed pursuant to this Agreement, Buyer authorizes Seller to become Buyer's retail electric provider for the.duration of the Agreement Term set forth in the Transaction Confirmation. Buyer authorizes Seller to act as Buyer's agent for the sole purpose to effect any change, if necessary, and Buyer shall direct its current retail electric provider to work with Seller to make this change happen. Buyer represents to Seller that Buyer is legally authorized to change the retail electric provider for all of the Premises and that Buyer's aggregated electric loads covered by this contract have an aggregated peak demand greater than one megawatt. 14.13 Severability. If any portion of this Agreement,or application thereof to any person or circumstance, shall be held legally invalid, the remainder shall not be affected and shall be valid and enforced to the fullest extent permitted by law or equity. 14.12 Aggregator Fees. Seller shall bill and collect from Buyer for HGAC Energy Purchasing Corporation("HGAC")Aggregation Fees with respect to the purchase of Electricity under these terms and conditions ("Aggregation Fees"). Seller shall remit all Aggregation Fee collections received during each calendar month to HGAC on or before the twentieth (20th)business day of the following calendar month. Payments received from Buyer shall be deemed to be payments of Seller and TDSP charges then due, then of Aggregation Fees. 14.13 Aggregator Review. Buyer understands and acknowledges that any deviations from the standard terms and conditions negotiated by HGAC on behalf of Buyer shall be subject to the prior review and consent of HGAC. The Parties have signed this Base Contract for Supply of Electricity document, acknowledging their agreement to its provisions as of ,200 . [BUYER SFULL'IEGAL%NAME INSERTED:;HEREj TXU ENERGY RETAIL COMPANY a[STATE][LEGAL ENTITY] a Texas limited partnership By: TXU Energy Retail Management Company LLC Its general partner By: By: Name: Name: Title: Title: Date: Date: "Buyer" "Seller" 1#.1L..NkMEINSERTED HERE] CONFIDENTIAL EXHIBIT._ TO fx. A of 4.01443-021 EXHIBIT A Page _I_ of ____L__ To the BASE CONTRACT FOR SUPPLY OF ELECTRICITY For purposes of this resolution, this document serves as Exhibit"A". Upon execution of the Supply Agreement, Exhibit"A" to the Base Contract will identify each of the meters covered under the proposed contract with an Electric Service Identifier. The final Exhibit"A" is not complete as of the date of this resolution authorizing the City Manger or Assistant City Manager to execute the Supply Agreement. EXHIBIT 19/ TO ,fix A .x ES ASWAV EXHIBIT A-1 Page —/ of To the BASE CONTRACT FOR SUPPLY OF ELECTRICITY For purposes of this resolution, this document serves as Exhibit "A-1". Upon execution of the Supply Agreement, Exhibit"A-1" to the Base Contract will identify the specific rates and charges under the proposed contract. The final Exhibit "A-1" is not complete as of the date of this resolution authorizing the City Manger or Assistant City Manager to execute the Supply Agreement.