CC Resolution No. 1519 2842
RESOLUTION NO. 1519
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS,
APPROVING AND AUTHORIZING EXECUTION OF A "SUPPLY AGREEMENT"
WITH A RETAIL ELECTRIC PROVIDER, APPROVING INITIAL PROPOSAL
PRICING; APPOINTING AUTHORIZED REPRESENTATIVES; AND PROVIDING
FOR THE EFFECTIVE DATE THEREOF.
WHEREAS, H-GAC Energy Purchasing Corporation(the "Corporation") is a non-profit political
subdivision corporation, as defined in Chapter 303 of the Texas Local Government Code (to be codified
effective September 1,2001 as Chapter 304);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 of the political subdivisions represented by
it; and
WHEREAS, the City Council of the City of Baytown (the "Political Subdivision") has adopted a
resolution authorizing participation in the Corporation; and
WHEREAS,the Corporation has negotiated and contracted with various Retail Electric Providers
(each a "REP") and has entered into a contract with the REP referenced in the attached Supply
Agreement; and
WHEREAS, the Member, as a Buyer, has selected the REP referenced in the attached Supply
Agreement; and
WHEREAS, the Corporation has received and distributed to its members the initial proposal
pricing("Initial Pricing")of the REP and the Political Subdivision has reviewed the Initial Pricing,which
is incorporated herein by reference; and
WHEREAS, the Political Subdivision acknowledges that the Initial Pricing is not binding on the
REP but will be updated during a subsequent time period to be announced by the Corporation, at which
time final closing pricing(the"Final Pricing")will be announced; and
WHEREAS, the Political Subdivision has reviewed a Supply Agreement with the selected REP
(the "Supply Agreement"), a copy of which is attached hereto as Exhibit"A"and incorporated herein by
reference for all intents and purposes, and wishes to enter into such agreement provided that the Final
Pricing does not exceed the Initial Proposal Pricing;NOW THEREFORE
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN,TEXAS:
Section 1: The Supply Agreement with the Initial Proposal Pricing made a part thereof is
hereby approved and adopted.
Section 2: The following officers, officials or employees of the Political Subdivision are
hereby designated as "Authorized Representatives," with full power and authority to execute the Supply
Agreement, so long as the Final Pricing is less than or equal to the Initial Proposal Pricing, exclusive of
any regulated rates subject to change, which the Political Subdivision has elected, and take all other
actions deemed necessary or appropriate to consummate the transaction authorized by this Resolution.
2843
Signature:
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Printed Name: Monte Mercer
Title: City Manager
Tele: (281)420-6501
Fax: (281)420-5891
E-mail: mmercerna.baytown.ore
Signature:
—� c
Printed Name: Fred Pack
Title: Director of Public Works and Utilities
Tele: (281)420-5312
Fax: (281)420-5322
E-mail: ftpack@baytown.org
Section 3: This resolution shall take effect immediately from and after its passage by the City
Council of the City of Baytown.
INTRODUCED, READ and PASSED,by the affirmative vote of the City Council of the City of
Baytown this the a day of November, 2001.
Act, C eee'
PETE C.ALFARO,Mayor
ATTEST: (/
G -W. S ]THI City Clerk
APPROVED AS TO FORM:
#GNACIO RAMIREZ, SR.,Ck Attorney
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2
SUPPLY AGREEMENT
November 5, 2001
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TERMS AND CONDITIONS FOR SUPPLY OF ELECTRICITY
These Terms and Conditions for the Supply of Electricity ("Terms"), together with any
Offer for Supply of Electricity ("Offer') and any other attachments, exhibits or appendices (including, as
appropriate,one or more Price Sheets)as may be hereafter agreed to by Buyer(the term Buyer includes its
employees and/or agents as appropriate), and Seller (the term Seller includes its assignees and/or as
appropriate its employees,agents and/or subcontractors),shall constitute the"Agreement'for the supply of
electricity to the Premise(s) of Buyer set forth in Exhibit "A" attached hereto. Seller and Buyer may
hereinafter be referred to individually as a "Party" and collectively as the "Parties'. "Premise(s)" herein
shall mean the designated (in Exhibit"A") property or facilities and associated metered account(s)identified
by an Electric Service Identifier ("ESI"), which is a unique and permanent identifier assigned to each
Premise(s). 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
Premises and shall contain the Offer Price. A condition precedent for the effectiveness of the Agreement
shall be the execution of a separate Offer, and agreement by the Parties on the terms contained in Exhibit
"A"and the appropriate Price Sheet(s).
I. SUBJECT MATTER AND QUANTITY. Seller shall sell and cause delivery, and Buyer shall purchase and
receive at the Point of Delivery,for use only at the Premise(s), Buyefs non-residential electricity requirements
set forth on Exhibit"A"attached hereto. "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 Rum]
Electric Cooperative. "Point of Delivery" herein shall mean the point where TDSP's conductors are
connected to Buyers conductors at or near Buyers Premises.
11. [This Section has been deleted intentionally]
III. TERM. The"Agreement Term" shall be the time period, as referred to in the Offer, during which the
prices contained In the Price Sheets are and shall remain in force.
IV. AGREEMENT RENEWAL/PRICE RENEGOTIATION. If Buyer and Seller have not agreed to new
pricing and terms prior to thirty calendar days before the expiration of the then current Offer, and Buyer has
not arranged for electricity from another supplier prior to the expiration of such Offer, then, effective upon
expiration of the Offer and until Buyer arranges for electricity with another supplier or under a new Offer with
Seller, Seller agrees to sell and deliver and Buyer agrees to purchase and receive electricity under terms
and prices of Sellers then current Standard List Pace Offer applicable to businesses of same or similar
nature as Buyer. "Standard List Price Offer herein shall mean the Sellers pace charged to customers
purchasing electricity without a valid Offer for the Supply of Electricity. The Standard List Price Offer may
change from time to time at the discretion of Seller.
V.CALCULATION AND PAYMENT OF CHARGES.
5.1 Seller will invoice Buyer for electricity delivered to the Premise(s)during each monthly billing cycle of the
Agreement Tenn, and for any other amounts due from Buyer to Seller hereunder, in accordance with the
applicable Price Sheet, provided, however, In the event Buyer Is a water district, a municipal utility district, a
public utility distinct, a water control improvement disrict, all other types of special districts, or has at the time
this Agreement is entered into, twenty five percent(25.0%) or more of Its total electric load Is attributable to
water pumping load, and(a)takes total quantities of electricity(attributable to all Premise(s)hereunder)in any
month that are in excess of one hundred twenty-five percent (125.0%)of the aggregated quantities listed in
0+ Exhibit"A",thenSeller shall have the option to price such excess quantities at 105.0%of the then current retail
market value or(b)takes quantities of electricity in a month that are less than seventy five percent(75.0%)of
the aggregated quantities listed in Exhibit"A"(provided
tssut�cth is not the result of a force majeure event)then,in
�pp H-GAC Energy Purchasing Corporation A Page I of 13
addition to paying for those quantities actually taken in accordance with the applicable Price Sheet, Buyer
agrees to pay Seller the positive amount, if any,calculated as follows: (75.0%of the aggregated quantities on
Exhibit"A"for the applicable month minus the aggregated quantities actually used by Buyer during the month,
the"Shortfall Quantity")multiplied by(the contracted price from the applicable Price Sheet minus 95.0%of the
then current retail market price for the Shortfall Quantity)."Retail Market Price"for purposes of this paragraph
5.1 only shall be: the weighted average of the ERCOT market clearing price for energy for each congestion
zone 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.
5.2 If Buyer has more than one Premise, the monthly billing cycle may vary for different Premises, and may
not coincide with a calendar month. In the event that an interval demand recorder("IDR")must be installed at
any Premise, 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.
5.3 Buyer shall pay the invoiced amount on or before the due date specified in the Offer,and/or notify Seller
within ten business days of the invoice date if Buyer disputes any part of the invoice together with Buyer's
reasons for disputing the invoice(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 part shall remain due and payable. In the event that Buyer
gives notice of such dispute,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. If the Parties are unable to resolve a
disputed invoice during that thirty day period,Seller may require,in the event it is subsequently determined that
Buyer should pay Seller all or part of the disputed amount,that Buyer pay interest on such amount, 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 originally due until the same is paid. Following resolution of the dispute,any amount
found payable(including interest)shall be paid within thirty calendar days.If Buyer fails to pay any amount due
(including any disputed amount withheld which is subsequently found to have been payable),Seller may,at its
option, pursue any or all of the following actions or remedies:(a)accrue interest on the unpaid portion at a rate
equal to that described earlier in this paragraph,from the date such payment is due until the same is paid, or
(b)transfer Buyer to the provider of last resort("POLR").POLR shall be defined as a retail electric provider that
has been designated by the PUCT to provide a basic, standard retail service package to requesting or
defaulting customers.
5.4 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(24)months of the date of the statement or payment for which such
adjustment or correction is requested.
5.5 If this Agreement is terminated for any reason (including where Buyer terminates in accordance with
Section VII)and Buyer does not arrange for a new electricity supply agreement with Seller or another supplier,
Seller, until Buyer arranges for a new electric supply agreement with Seller or another supplier, may (in
addition to other remedies)charge Buyer for any electricity used at the Premise(s)after the effective date of the
termination, and subject to these Terms, at Seller's then current Standard List Price Offer applicable to
businesses of same or similar nature as Buyer.This sub-clause shall survive termination of this Agreement.
5.6 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 dates specified in Article II of the Offer. The address to
which payments are to be made shall be as set forth in the Offer. For Buyer to pay Seller other than by
check, Buyer needs to obtain required information/agreements with Seller. If Buyer fails to pay the invoiced
amount to Seller by the Due Date,and such amount is not disputed as provided in Section 5.3 the undisputed
invoiced amount will accrue interest at the rate of 12% per year,and,in addition,Seller may pursue,but is not
required to pursue, available legal remedies for collection of the unpaid invoice and late-payment interest
charges,including termination of the Agreement in accordance with the procedures set forth in Article VI I.
5.7 In the event Buyer ever takes electricity exceeding the Maximum kW for each 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 is set forth on Exhibit"A",and shall be recorded at the TDSP Point of Delivery.
H-GAC Energy Purchasing Corporation Page 2 of 13
` 5.8 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.
VI.METERING EQUIPMENT.
6.1 The supply of electricity to Buyer at the TDSP Delivery Point(s) shall be measured by Metering
Equipment. "Metering Equipment"herein shall mean any and all equipment required for the measurement
of demand, energy, reactive demand or reactive energy and the times during which said demand or energy
is consumed. 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)the Metering Equipment shall be examined within a reasonable period by the TDSP in accordance
with the applicable Substantive Rules of the PUCT. If such test finds that the inaccuracy of the registration
of kWh or kW at normal loads exceeds that allowed by ANSI standard C.12, 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 entity that installs, validates, registers, and
maintains the physical meter required on a Premise to measure customer usage. 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.
6.2 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 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 Sellers negligence.
VII . TERMINATION OF AGREEMENT.
7.1 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, provided, however, that notwithstanding the foregoing or
anything else to the contrary in this Agreement,Supplier may not terminate this Agreement for non-payment
by Buyer of an undisputed invoiced amount unless the undisputed invoiced amount remains unpaid for thirty
(30) days after the due date; (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 is taking 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 affect 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 Premises)with another retail energy provider
that covers any period during the Agreement Term;or(f)if Buyer,except as provided in paragraphs 7.2 and
14.3 below, sells, leases, closes or otherwise conveys or assigns any Premise(s) in which the electricity
sold hereunder is utilized. 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
right under this Agreement,at law,or in equity,terminate this Agreement(1)by providing an additional notice
if the breaching Party does not pay all amounts due and owing set forth in the Original Notice within ten
calendar days of the date of the Original Notice, or (ii) effective immediately in the Original Notice in the
event the breach pertains to(c),(e),or(f)in this paragraph above,or(iii)by providing an additional notice if
the breaching Party fails to cure any breach other than one related to (a), (c), (e), or (f) in this paragraph
above within thirty calendar days of the date of the Original Notice.
7.2 (a) In the event Buyer sells, closes, or leases a particular Premise, without selling, closing, or
leasing all of the Premises, Buyer shall have the right to delete that particular Premise and the quantities of
electricity attributable to that Premise through the end of the Agreement Term (the"Liquidated Quantities")
from this Agreement without terminating the Agreement(a"Premise Buyout Option"). If Buyer desires to
exercise a Premise Buyout Option with regard to a Premise, Buyer shall notify Seller in writing at least thirty
H-GAC Energy Purchasing Corporation Page 3 of 13
calendar days prior to the effective date. Upon the exercise of a Premise Buyout Option, in the event a new
owner of the applicable Premise (i) is willing to sign a new contract with Seller upon the same terms and
conditions as Buyer's contract, (ii)is deemed creditworthy by Seller, and (ill)the new owner and Seller can
legally enter into such a contract in accordance with the rules and regulations of the PUCT, then the
Premise will be deleted from this Agreement and neither Party will owe any compensation to the other. In
the event that the new owner (1) is unwilling to sign a contract with Seller upon the same terms and
conditions, (ii) is not reasonably deemed creditworthy by Seller, or (ill) the new owner and Seller cannot
legally enter into the contract, then Buyer agrees to pay Seller the positive amount, N 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 95.0%of
the then current retail market price). Buyer shall pay such amount, if any,to Seller within twenty days of the
date of liquidation. Exhibit "A" shall be modified to reflect the deletion of such Premise and its Liquidated
Quantities, and all other terms and conditions of this Agreement shall remain in full force and effect with
respect to the remaining Premises.
(b) In the event Buyer reduces its operations at a Premise, Buyer shall have the right to delete
the quantities of electricity attributable to the reduction In operations at such Premise from the effective date
of the reduction through the end of the Agreement Term(the"Reduced Operations Liquidated Quantities")
from this Agreement without terminating the Agreement. If Buyer desires to exercise such right with regard
to a Premise,Buyer shall notify Seller in writing at least thirty calendar days prior to the effective date. Upon
the exercise of such right, Buyer agrees to pay Seller the positive amount, if any, calculated as follows:the
Reduced Operations Liquidated Quantities multiplied by (the price that Buyer would have paid for the
Reduced Operations Liquidated Quantities through the end of the Agreement Term according to the
applicable Price Sheet,minus 95.0%of the then current retail market price for the liquidated quantities). Buyer
shall pay such amount, if any, to Seller within twenty days of the date of liquidation. Exhibit "A" shall be
modified to reflect the deletion of the liquidated quantities, and all other terms and conditions of this
Agreement shall remain in full force and effect.
(c)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. Since it is not possible to foresee
the evolution of the deregulated power industry in Texas, various reasonable options for Buyer to achieve
this are evolving and under development by Seller. For example, if Buyer desires to contract for additional
electricity, 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.
7.3 (a) In the event that this Agreement is terminated by Seller pursuant to Section 7.1Lthe 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"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 Price
Sheet, minus the current retail market price for the unpurchased quantities at the time of termination)plus(all
reasonable costs and expenses incurred by Seller). Such amount shall be immediately due and payable within
thirty calendar days following such termination.The current retail market price 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 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.
(b) In the event that this Agreement is terminated by Buyer pursuant to Section 7.1 jhe 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" through the end of the Agreement Term) multiplied by (the current retail market price 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 costs and expenses incurred by Buyer). Such amount shall be immediately due and
payable within thirty calendar days following such termination.The current retail market price In this instance
shall mean the price Buyer would have to pay if entering Into a contract with another Retail Electric Provider
("REP")for the same quantities,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
H-GAC Energy Purchasing Corporation Page 4 of 13
used to calculate Buyer's damages. Buyer shall have a duty to use commercially reasonable efforts to
mitigate its damages.
7.4 Buyer may terminate this Agreement, on a prospective basis, in the event of non-appropriation of
funding for this Agreement by Buyer's Goveming Body. Buyer agrees, to the full extent allowed by Texas
law, that if any funds are appropriated for electricity costs, such funds shall be applied first to the cost of
electricity provided pursuant to this Agreement. Buyer agrees to notify the REP in writing of such non-
appropriation at the earliest practicable time subsequent to the failure to appropriate, and as of Buyer's
termination date, Seller shall have no further duty to supply Electricity to Buyer and shall move service for
the Accounts to the POLR as established by the PUCT on the date of termination for non-appropriation.
VIII . 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 shall be suspended to
the extent made necessary by such event. The term "force majeure" means any cause not within the
control of the Party claiming relief,including,but not limited to,Acts of God,including magnetic disturbances
but not including extremes of temperature alone; arrests, orders,directives, restraints and requirements of
the govemment and governmental agencies, either federal or state (excluding Buyer), civil or military; civil
disorder; strikes or labor disputes; failure, repair or change of or obstruction in electric power lines,
equipment or machinery; the failure of the TDSP to receive, transport, or deliver, or otherwise perform,
unless due to the failure of the Party claiming force majeure to perform such Party's obligations hereunder;
an event of force majeure of Seller's supplier(s)or with Buyer's electrical equipment at Buyer's Premises; or
any other cause which by the exercise of reasonable diligence such Party could not have prevented or is
unable to overcome. 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 Parry's financial inability to perform its obligations under this Agreement, constitute an
event of Force Majeure hereunder.
IX. WARRANTIES AND LIMITATIONS OF LIABILITIES.
9.1 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.
9.2 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, 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.
X . 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, registered or certified),
postage prepaid, when deposited with an ovemight delivery service, prepaid to the applicable Buyer's
address shown in the attached Exhibit"A".and Seller's address as shown in the Offer,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; provided, however, except for
payments of amounts due hereunder, either Party may provide such items hereunder by electronic mail or
facsimile to the other Party at the applicable telephone number shown on the current Offer, and further
provided, the original copy of such item shall be sent to the other Party within three business days
thereafter.
H-GAC Energy Purchasing Corporation Page 5 of 13
XI . APPLICABLE LAW AND REGULATIONS.
11.1 This Agreement is subject to all applicable laws,regulations,rules and orders.
11.2 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 attempt 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.
11.3 Seller agrees to maintain all necessary certifications and comply with all necessary PUCT and/or
ERCOT requirements in order to perform its obligations under this Agreement.
11.4 Notwithstanding anything contained in this Agreement,Buyer shall not attempt to utilize,under the
provisions of this Section XI or Section Vlll,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.
XII . FAILURE OR TEMPORARY DISCONTINUANCE OF SUPPLY.
12.1 The supply of electricity may be disconnected in the event of Force Majeure in respect of this
Agreement; or if at TDSP's discretion it is necessary to do so for any of the following reasons: (a)to avoid
danger; or because failure to disconnect the supply of electricity would or might involve TDSP being in
breach of applicable regulations or laws; or to avoid interference with the supply of electricity to another
person which TDSP reasonably believes may be caused or result from Buyer's equipment or device used at
the Premise(s);or to enable TDSP or TDSP's representatives to inspect, maintain or repair any part of the
equipment or the Distribution System; or in case of accident or other emergency affecting or likely to affect
the Distribution System or any other system through which(directly or indirectly)Seller or TDSP receives or
supplies electricity;or(b)because Buyer's electric connections or systems are deemed by TDSP to present
a hazard.
12.2 In the event that the supply of electricity to Buyer's Premises is interrupted due to the material breach
by Seller of its contractual obligations under this Agreement and not due to (i)a force majeure event, (ii)as
provided in paragraph 12.1 above, or (Ili) the failure of Buyer to comply with its obligations under this
Agreement,then,in the event Buyer is required to purchase replacement electricity from a third party during
such interruption, Seller shall be liable for the positive amount, if any, calculated as follows:the quantities so
interrupted by Seller multiplied by[the then current retail market price(or the POLR price if Buyer was unable
to purchase electricity from another retail electricity provider) minus the contracted price from the applicable
Price Sheet].
XIII. RESPONSIBILITY.
13.1 Buyer Responsibility. Buyer assumes full responsibility for electric energy furnished to Buyer at and on
Buyer's side of the Point of Delivery, and agrees,to the full extent allowed by law, to 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 Point of Delivery and upon the Premise(s),arising out of or related
to the electric power and energy and/or Buyer's performance under the Agreement.
13.2 Seller Responsibility. Buyer acknowledges and understands that (i) Seller never obtains physical
possession or control of the electricity, (ii)Seller does not own nor have control of the electric transmission
wires and equipment, and that they are owned and/or controlled by the TDSP, (ill) all meter reading, and
repair services will be provided by employees or agents of the TDSP, (iv)all responsibilities and liabilities of
the TDSP are set forth in the tariff regulations as approved by the PUCT, and (v)the employees and agents
of the TDSP are not employees or agents of Seller. Seller shall not have any obligation whatsoever to
indemnify, defend, nor hold harmless Buyer, its parent company and all of its affiliates, and all of their
respective officers, directors, shareholders, associates, employees, servants, and agents (hereinafter
H-GAC Energy Purchasing Corporation Page 6 of 13
collectively referred to as"Buyer Group"),against any Claims,on either side of the Point of Delivery,arising
out of or in any way related to the electricity and/or the delivery thereof, including, without limitation, the
actions of the TDSP and its employees and agents, except in the event, and only in the event, that such
Claims are the direct result of the sole negligence and/or intentionally wrongful act of an employee,or agent
under the exclusive control,of Seller.
XIV. MISCELLANEOUS.
14.1 TDSPs. Buyer and Seller agree to all terms and conditions(adopted pursuant to statutes,regulations
or other lawful authority) of the TDSPs that provide electricity delivery services to the Premise(s) or other
Buyer facilities,which may from time to time be amended,are made part of this Agreement.
14.2 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
CONFLICTS OF LAW PRINCIPLES WHICH OTHERWISE MIGHT BE APPLICABLE.
14.3 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 assign this Agreement to another party, with 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.
14.4 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.It is also the intention of the Parties to agree to
terms of service different than those that would otherwise apply under the Substantive Rules of the Public
Utility Commission of Texas "Customer Protection Rules for Retail Electric Service", Sections 25.471 -
25.485, and 25.491 - 25.492. The Parties expressly acknowledge that certain terms, conditions, and
protections addressed in such sections 25.472 - 25.485, and 25.491 - 25.492 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, conditions,
and protections are not applicable to the Parties. Neither Party may assert any claim that any term,
condition, and/or protection contained in Sections 25.472 - 25.485 and 25.491 - 25.492 of the Rules is
inconsistent with any term,condition,and/or protection contained in the Agreement and,therefore,applies to
the Parties.This Agreement may not be modified or amended except in writing,duly executed by the Parties
hereto. Buyer warrants that the information supplied by it pursuant to this Agreement is true and shall
remain so throughout the term of the Agreement unless varied by agreement.
14.5 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 enforce and compel strict compliance with the same or other terms or provisions of this
Agreement.
14.6 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.
14.7 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 and obligations of indemnity.
14.8 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.
14.9 Distribution System. Distribution System herein shall mean any system for the distribution of electricity
through which the electricity to be provided by Seller to Buyer is provided or passed to the Premise(s).
Seller's obligations under this Agreement are subject to the maximum capacity and any other design feature
of Buyer's Premise or Connection. Buyer shall contact Seller in accordance with all applicable legal
H-GAC Energy Purchasing Corporation Page 7 of 13
requirements, and otherwise reasonably in advance, if Buyer proposes to make any significant change to
Buyer's connection, electric lines or electrical equipment, install or operate generating equipment or do
anything else that could affect the Distribution System or require alterations to Buyer's Connection. Each of
the Parties undertakes to comply with Buyer's TDSP's Tariff for Distribution Service.
14.10 Delivery of Electricity. Seller does not guarantee against irregularities or interruptions, it being
understood that occasional irregularities and interruptions by the TDSP may occur. Buyer is responsible for
installing and maintaining protective devices as recommended or required by the then current edition of the
National Electric Code and other such devices as are necessary to protect equipment or process during
irregular or interrupted service including,but not limited to voltage and wave form irregularities.
14.11 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, Seller and Buyer
agree to keep all terms and provisions of this Agreement confidential and not to disclose the terms of the
same to any third parties; provided, however, each Party shall have the right to make such disclosures, if
any,to governmental agencies and to its own agents,attorneys, auditors,accountants and shareholders as
may be reasonably necessary. If disclosure is sought through process of a court, or a state or federal
regulatory agency, the Party from whom the disclosure is sought shall resist disclosure through all
reasonable means and shall immediately notify the other Party to allow it the opportunity to participate in
such proceedings.
14.12 Resale of Seller's Electric Service. Buyer may not use supply of electricity provided by Seller except
for the purpose specified in the Price Sheet under which Buyer receives supply of electricity. Buyer may not
resell or otherwise dispose of supply of electricity unless as provided by statute or as specifically provided
for in the Price Sheet.
14.13 Authorization. At such time as executed Offer and Price Sheet(s) are attached hereto, Buyer
authorizes Seller to become Buyer's new retail electric provider in place of Buyer's current retail electric
provider for the duration of the Agreement Term set forth in the Offer. Buyer authorizes Seller to act as
Buyer's agent to effect the change,and Buyer directs 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.
14.14 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.
14.15 Agareaator 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 (2&)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 the
Aggregation Fee.
14.16 Aggregator Review. Buyer understands and acknowledges that any deviations from the standard
Terms and Conditions for Supply of Electricity negotiated by HGAC on behalf of Buyer shall be subject to
the prior review and consent of the HGAC.
14.17 Buyer is a Member of the HGAC Energy Purchasing Corporation. Seller is basing the indicative price
on the attached price sheet upon assumptions as to the aggregated load and associated load factor of all
Members of the Corporation. A condition precedent to the effectiveness of this Agreement is satisfaction of
certain load and load factor criteria as agreed to between Seller and the HGAC Energy Purchasing
Corporation. In the event that such criteria,as established in Section 1.b of the Agreement between H-GAC
Energy Purchasing Corporation and TXU Energy Services, are not satisfied, then Seller shall not sign this
Agreement and it shall be null and void ab initio.
14.18 Buyer shall notify seller of any ESIs that have any significant load shifting capabilities so Seller may
offer multipart pricing for that Premise.
H-GAC Energy(Purchasing Corporation Page 8 of 13
AIMN The Parties have signed this Terms and Conditions for Supply of Electricity document,
acknowledging their agreement to its provisions as of , 200_.
TXU ENERGY SERVICES COMPANY
By: By:
Name: Name:
Title: Title:
Date: Date:
"Buyer" "Seller"
H-GAC Energy Purchasing Corporation Page 9 of 13
Exhibit A
List of Member Buyers' Accounts
H-GAC Energy Purchasing Corporation Page 10 of 13
Exhibit B
Pricing Sheet
TXU Energy Services
Price Sheet
Terms and Conditions for Supply of Electricity#
This Price Sheet is only valid in association with and shall remain subject to the Terms and Conditions for
Supply of Electricity ("Terms") and Offer for Supply of Electricity referenced above and is contingent
upon Customer's acceptance of the Offer prior to the Offer Expiration Date. This Price Sheet is applicable
to the Customer ESI number(s)identified on Exhibit A of the Terms.
Monthly Prices shall equal the sum of (i) the Monthly Standing Charge set forth below; plus (ii) the
applicable per kWh charges set forth below for the electricity;plus(iii)all costs and expenses of any nature
whatsoever that are charged by the Transmission and Distribution Service Provider ("TDSP") for the
transmission and/or distribution of the electricity, as well as any other charges of the TDSP that are
attributable to the Customer Account numbers, including, without limitation, charges for reactive power;
plus (iv) all other tariffs, rates, riders, fees, and charges, charged by the TDSP or another party, that are
mandated, levied, assessed, allowed, or approved by the Texas Public Utility Commission and all other
governmental or regulatory authorities,on or with respect to the acquisition,sale,delivery, and purchase of
the electricity; plus (v) all federal, state, and local taxes, of any nature whatsoever, imposed by all
governmental and regulatory authorities, on or with respect to the acquisition, sale, delivery, and purchase
of the electricity, including Seller's Texas Gross Receipts Tax on the sale of electricity to Buyer;plus (vi)
the Over Capacity Charge set forth below, if applicable;plus(vii)an aggregation fee of$0.00045 per kWh
actually consumed by Buyer collected by Seller on behalf of and paid to HGAC Energy Purchasing
Corporation.
Charge Amount
Monthly Standing Charge $5 per service point
All kWh $0. per kWh
$0. per kWh for delivery,excluding
TDSP Delivery Charges reactive power,based upon current estimate*;
Monthly rice will be based upon actual charges.
Tariffs,rates,riders,fees,and charges other than To be determined,varies by service point
those included in TDSP delivery charges above
All applicable taxes To be determined,varies by jurisdiction
Over Capacity Charge $-0-per kW
Buyer shall notify seller of any ESIs that have any significant load shifting capabilities so Seller may
offer multipart pricing for that Premise.
The costs and expenses charged by the TDSP for delivery services may fluctuate during the Agreement
Term,as will other applicable taxes,tariffs,riders,fees,and charges.
* For reference purposes only. This is the current estimate of the average TDSP standard
delivery costs, excluding charges for reactive power, special metering, or other
miscellaneous TDSP charges.
H-GAC Energy Purchasing Corporation Page 11 of 13
Exhibit C
OFFER FOR THE SUPPLY OF ELECTRICITY
Contract/Plan#:
BUYER: SELLER: TXU Energy Services Company
1601 Bryan Street, 70'Floor
Dallas,Texas 75201
Phone: Phone: (214) 875-1000
Fax: Fax: 214 875-1001
L The Primary Term for each Premise, identified in Exhibit A, shall
CONTRACT TERM commence upon the date of the first reading of the meter(s) on each
respective Premise by the TDSP after , or as soon thereafter as
practicable, and shall end for each Premise upon the date of the first reading
of the respective Premise meter s by the TDSP after
II. Net 30 days.
PAYMENT TERMS
III. No initial deposit required.
DEPOSIT AMOUNT
IV.
BILL PRESENTMENT METHOD
V.
PAYMENT METHOD
VI. Toll free number (800)725-7920 for 24 hour emergency outage and
STANDARD SERVICES customer service, available 7 a.m. to 7 p.m. on normal business days;
Assigned customer service representative, billing analyst, and assigned
rofessional account manager.
ViI. Not Applicable
CUSTOM SERVICES
VIII. Not Applicable
SPECIAL PROVISIONS
Ix $ per kWh
AVERAGE COST PER KWH*
X. TERMS AND CONDITIONS THIS OFFER FOR THE SUPPLY OF ELECTRICITY INCLUDES
THE TERMS AND CONDITIONS FOR THE SUPPLY OF
ELECTRICITY, WHICH SHALL BE SEPARATELY EXECUTED BY
BUYER AND SELLER AND WILL BE PART OF THIS CONTRACT.
BY SIGNING BELOW,BOTH PARTIES HEREBY ACKNOWLEDGE ACCEPTANCE OF THIS
OFFER FOT THE SUPPLY OF ELECTRICITY.
Buyer Signature: Seller Signature:
Name(Please print): Name(Please print):
Kevin Bohn
Position: Position:
Vice President
Date: Date:
*Estimated.Actual cost will vary with actual delivery charges from your transmission and distribution
provider and actual consumption patterns. This cost does not include applicable taxes.
H-GAC Energy Purchasing Corporation Page 12 of 13
Exhibit D
FORM LETTER-AUTHORIZATION FOR RELEASE OF ELECTRIC UTILITY DATA
TO BE SIGNED BY MEMBER BUYER ON ITS LETTER HEAD
[Date]
TXU Energy Services Company
1601 Bryan Street
Dallas,Texas 75201
Re: Account Data for Accounts listed in Attachment
[Attach relevant portion of Exhibit A for description of Accounts]
This letter is to serve as authorization to release to , or H-GAC Energy
Purchasing Corporation all information relative to our account(s) listed in the attachment,
including but not limited to service, load history, load profiles, rates, payment history,
billing data and billing determinants. This request for release is valid for one (2) years
from the date of this letter with respect to and five (5)years from the date of this
letter with respect to H-GAC.
Very truly yours,
[Member Buyer Representative Signature]
[Title of Member Buyer's Representative]
H-GAC Energy Purchasing Corporation Page 13 of 13