R-524-6-84_
RESOLUTION NO. 524-6-84(R)
CERTIFICATE FOR
RESOLUTION AUTHORIZING AND DIRECTING THE EABCUTION OF THE "UPPER EAST
FORK G&MEWATER INTERCEPTOR SYSTEM CONTRACT" WITH NORTH TEXAS 10NICIPAL
TVATER DISTRICT AMID aIHERS, AMID PROVIDIlZG FOR THE EFFECT OF SAID
RESOLUTION AND CONTRACT
THE STATE OF TEXAS
COUNTY OF COLLIN
CITY OF ALLEN
We, the undersigned officers of the City of Allen, Texas, hereby certify
as follows:
1. The City Council of the
REGULAR MEETING ON THE
the roll was called of the duly
Council, to -wit:
Marty Hendrix,
Joe Farmer
G. Ward Paxton
Rex Womack
City Secretary
City of Allen convened in
21ST DAY OF JUNE, 1984, at the City Hall, and
constituted officers and members of said City
Donald P. Rodenbaugh, Mayor
J. M. McClure
Dennis Offutt
Jim 6Tolfe
and all of said persons were present, except the following absentees:
NONE, thus constituting a quorum. 6iereupon, among other business, the
following was transacted at said Meeting: a written
RESOLUTION AUTHORIZING AM DIRECTING THE EXECUTION OF THE "UPPER
EAST FORK VASTEWATER INTERC'E TOR SYSTEM C014TRACT" WITH NORTH TEXAS
MUNICIPAL 1,TATER DISTRICT AND OTHERS, AND PROVIDING FOR THE EFFECT OF
SAID RESOLUTION AND CONTRACT
was duly introduced for the consideration of said City Council and duly read.
It was then duly moved and seconded that said Resolution be adopted and
passed; and, after due discussion, said motion, carrying with it the adoption
and passage of said Resolution, prevailed and carried by the following record
vote:
AYES: Rodenbaugh, McClure, Wolfe, Farmer, and Womack.
NAYS: Paxton and Offutt.
2. That a true, full, and correct copy of the aforesaid Resolution
adopted and passed at the Meeting described in the above and foregoing para-
graph is attached to and follows this Certificate; that said Resolution has
been duly recorded in said City Council's minutes of said Meeting; that the
above and foregoing paragraph is a true, full, and correct excerpt from said
City Council's minutes of said Meeting pertaining to the adoption and passage
of said Resolution; that the persons named in the above and foregoing para-
graph are the duly chosen, qualified, and acting officers and members of said
City Council as indicated therein; and that each of the officers and members
of said City Council was duly and sufficiently notified officially and per-
sonally, in advance, of the time, place, and purpose of the aforesaid Meeting,
and that said Resolution would be introduced and considered for adoption and
passage at said Meeting; and that said Meeting was open to the public, and
public notice of the time, place, and purpose of said Meeting was given, all
as required by Vernon's Ann. Civ. St. Article 6252-17.
3. That the Mayor of said City of Allen has approved, and hereby ap-
proves, the aforesaid Resolution; that the Mayor and the City Secretary of
said City have duly signed and authenticated said Resolution; and that the
Mayor and the City Secretary of said City hereby declare that their signing of
this Certificate shall constitute the signing and authentication of the
attached and following copy of said Resolution for all purposes.
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City c�bcretary o •
(CITY SEAL)
CERTIFICATE FOR
RESOLUTION AUTHORIZING AND DIRECTING TILE EXECUTION OF THE "UPPER EAST
FORK WASTEWATER I]NTERCEPT`OR SYSTEM CONTRACT" WITII NORTH TEXAS PIUNICIPAL
WN= DISTRICT AND OT[IEILS, AND PROVIDING FOR THE EFFECT OF SAID
RESOLUTION AND C014TTACT
THE STATE OF TEXAS
COUNTY OF COLLIN
CITY OF ALLEN
We, the undersigned officers of the City of Allen, Texas, hereby certify
as follows:
1. The City Council of the
REGULAR MEETING ON THE
the roll was called of the duly
Council, to -wit:
Marty Hendrix,
Joe Farmer
G. Ward Paxton
Rex Womack
City Secretary
City of Allen convened in
21ST DAY OF JUNE, 1984, at the City Hall, and
constituted officers and members of said City
Donald P. Rodenbaugh, Mayor
J. M. McClure
Dennis Offutt
Jim Vblfe
and all of said persons were present, except the following absentees:
NONE, thus constituting a quorum. Whereupon, among other business, the
following was transacted at said Meeting: a written
RESOLUTION AUTHORIZING AND DIRECTING THE EXECUTION OF THE "UPPER
EAST FORK W70TEWATER INTERCEPTOR SYSTEM CONTRACT" WITH NORTH TEXAS
MUNICIPAL `ITER DISTRICT AND OTHERS, AMID PROVIDING FOR THE EFFECT OF
SAID RESOLUTION AND CONTRACT
was duly introduced for the consideration of said City Council and duly read.
It was then duly moved and seconded that said Resolution be adopted and
passed; and, after due discussion, said motion, carrying with it the adoption
and passage of said Resolution, prevailed and carried by the following record
vote:
AYES: Rodenbaugh, McClure, Wolfe, Farmer, and Womack.
NAYS: Paxton and Offutt.
2. That a true, full, and correct copy of the aforesaid Resolution
adopted and passed at the Meeting described in the above and foregoing para-
graph is attached to and follows this Certificate; that said Resolution has
been duly recorded in said City Council's minutes of said Meeting; that the
above and foregoing paragraph is a true, full, and correct excerpt from said
City Council's minutes of said Meeting pertaining to the adoption and passage
of said Resolution; that the persons named in the above and foregoing para-
graph are the duly chosen, qualified, and acting officers and members of said
City Council as indicated therein; and that each of the officers and members
of said City Council was duly and sufficiently notified officially and per-
sonally, in advance, of the time, place, and purpose of the aforesaid Meeting,
and that said Resolution would be introduced and considered for adoption and
passage at said Meeting; and that said Meeting was open to the public, and
public notice of the time, place, and purpose of said Meeting was given, all
as required by Vernon's Ann. Civ. St. Article 6252-17.
3. That the Mayor of said City of Allen has approved, and hereby ap-
proves, the aforesaid Resolution; that the Mayor and the City Secretary of
said City have duly signed and authenticated said Resolution; and that the
Mayor and the City Secretary of said City hereby declare that their signing of
this Certificate shall constitute the signing and authentication of the
attached and following copy of said Resolution for all purposes.
SIGNED AND SEALED the 21st day
City S&retary
11
(CITY SEAL)
of June, 1984.
MT
�, N�- - `
RESOLUTION NO. 524-6-84(R)
RESOLUTION AUTHORIZING AND DIRECTING THE EXECUTION OF
THE "UPPER EAST FORK WASTEWATER INTERCEPTOR SYSTEM
CONTRACT" WITH NORTH TEXAS MUNICIPAL WATER DISTRICT
AND OTHERS, AND PROVIDING FOR THE EFFECT OF SAID
RESOLUTION AND CONTRACT
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ALLEN:
SECTION I
That, for and on behalf of the City of Allen, the Mayor of
the City of Allen is hereby authorized and directed to sign,
deliver, and otherwise execute, and the City Secretary of the
City of Allen is hereby authorized and directed to sign,
attest, and seal, the "Upper East Fork Wastewater Interceptor
System Contract" (the "Contract") with North Texas Municipal
Water District and others in substantially the form and sub-
stance attached to this Resolution and made a part hereof for
all purposes.
SECTION 2
That, upon its execution by the parties thereto, the
Contract shall be binding upon the City of Allen in accordance
with its terms and provisions.
SECTION 3
That this Resolution shall take effect and be in full
force and effect from and after the date of its adoption and
passage, and it is so resolved; and all ordinances and resolu-
tions of the City of Allen in conflict herewith are hereby
amended or repealed to the extent of such conflict, and all
such ordinances and resolutions, and any contracts or agree-
ments or parts authorized thereby, shall be of no further force
or effect upon execution of the Contract to the extent of any
such conflict.
UPPER EAST FORK WASTEWATER INTERCEPTOR SYSTEM CONTRACT
THE STATE OF TEXAS
NORTH TEXAS MUNICIPAL WATER DISTRICT
THIS UPPER EAST FORK WASTEWATER INTERCEPTOR SYSTEM CON-
TRACT (the "Contract") made and entered into as of the day
of , 1984 (the "Contract Date"), by and among NORTH
TEXAS MUNICIPAL WATER DISTRICT (the "District"), an agency and
political subdivision of the State of Texas, being a conserva-
tion and reclamation district created and functioning under
Article 16, Section 59, of the Texas Constitution, pursuant to
Chapter 62, Acts of the 52nd Legislature of the State of Texas,
Regular Session, 1951, as amended (the "District Act"), and the
following:
CITY OF ALLEN, IN COLLIN COUNTY, TEXAS,
CITY OF McKINNEY, IN COLLIN COUNTY, TEXAS,
CITY OF PLANO, IN COLLIN COUNTY, TEXAS, and
CITY OF RICHARDSON, IN DALLAS AND COLLIN COUNTIES, TEXAS
(collectively the "Initial Contracting Parties").
W I T N E S S E T H:
WHEREAS, each of the Initial Contracting Parties is a duly
created city and political subdivision of the State of Texas
operating under the Constitution and laws of the State of
Texas; and
WHEREAS, the District and the Initial Contracting Parties
are authorized to enter into this Contract pursuant to the
District Act, Chapter 30, Texas Water Code, Vernon's Ann. Tex.
Civ. St. Article 4413(32c) (the "Interlocal Cooperation Act"),
and other applicable laws; and
WHEREAS, the District presently owns and operates a
regional Wastewater treatment system serving the Initial Con-
tracting Parties in the area of the upper East Fork of the
Trinity River in Dallas and Collin Counties, Texas, (the
"Treatment System"); and
WHEREAS, the District presently serves the Initial Con-
tracting Parties under various "Trinity East Fork Regional
1
Wastewater System Contracts" (the "Treatment Contracts") now in
effect, but the present Treatment System does not include, and
by the Treatment Contracts the Treatment System is prohibited
from including, any facilities required to transport Wastewater
to the Point of Entry of any Initial Contracting Party into the
District's Treatment System; and
WHEREAS, the District proposes to acquire and construct
facilities which will not be part of the Treatment System, but
which will consist of facilities required to transport Waste-
water of the Initial Contracting Parties to their respective
Points of Entry into the Treatment System; and
WHEREAS such Wastewater transportation facilities (herein-
after called the "Interceptor System") are described in a
report of Shimek, Jacobs & Finklea, Consulting Engineers,
Dallas, Texas, dated November, 1983; and
WHEREAS, such report, including all amendments and supple-
ments thereto made prior to the execution of acquisition and
construction contracts for the Interceptor System and as
changed by change orders entered after acquisition and con-
struction contracts for the Interceptor System have been
executed, is hereinafter called the "Engineering Report"; and
WHEREAS, it is expected by the parties hereto that as soon
as practicable after the execution of this Contract the Dis-
trict will issue Bonds payable from and secured by Annual
Payments made under this Contract by the Initial Contracting
Parties to provide the Interceptor System.
NOW, THEREFORE, in consideration of the mutual covenants
and agreements herein contained, the District agrees to use its
best efforts to issue its Bonds and to provide the Wastewater
transportation services of the Interceptor System to the
Initial Contracting Parties under this Contract, and to use its
best efforts to acquire and construct the Interceptor System,
upon and subject to the terms and conditions hereinafter set
forth, to -wit:
Section 1. DEFINITION OF TERMS. The following terms and
expressions as used in this Contract, unless the context
clearly shows otherwise, shall have the following meanings:
(a) "Additional Contracting Party" means any party not
defined as one of the Initial Contracting Parties with which
the District makes a contract similar to this Contract for
providing services of the Interceptor System, provided that
after execution of any such contract such party shall become
one of the Contracting Parties for all purposes of this Con-
tract, unless otherwise specifically provided herein.
(b) "Adjusted Annual Payment" means the Annual Payment,
as adjusted during or after each Annual Payment Period, as
provided by this Contract.
(c) "Annual Payment" means the amount of money to be paid
to the District by each of the Contracting Parties during each
Annual Payment Period as its proportionate share of the Annual
Requirement.
(d) "Annual Payment Period" means the District's Fiscal
Year, which currently begins on October 1 of each calendar year
and ends on the last day of September of the next calendar
year, and the first Annual Payment Period under this Contract
shall be the period of October 1, 1984, through September 30,
1985.
(e) "Annual Requirement" means the total amount of money
required for the District to pay all Operation and Maintenance
Expenses of the Interceptor System, to pay the debt service on
its Bonds, to pay or restore any amounts required to be de-
posited in any special, contingency, or reserve funds required
to be established and/or maintained by the provisions of the
Bond Resolutions, all as further described in this Contract.
(f) "Bond Resolution" means any resolution of the Dis-
trict which authorizes any Bonds.
(g) "Bonds" means bonds hereafter issued by the District,
whether in one or more series or issues, and the interest
3
thereon, to acquire and construct the Interceptor System,
and/or subsequently to improve and/or extend the Interceptor
System, and any bonds issued to refund any Bonds or to refund
any such refunding bonds.
(h) "Contracting Parties" means the "Initial Contracting
Parties", as defined in the first paragraph of this Contract,
together with any other party or parties which hereafter
becomes one of the Contracting Parties by becoming an Addi-
tional Contracting Party.
(i) "Contracting Party" means any one of the Contracting
Parties.
(j) "Engineering Report" means the "Engineering Report"
as defined in the preamble to this Contract.
(k) "Interceptor System" means collectively the Waste-
water transportation facilities described in the Engineering
Report, and all improvements and additions to and extensions,
enlargements, and replacements of such facilities which are
acquired and constructed by the District in order to receive
and transport Wastewater of the Contracting Parties to their
respective Points of Entry into the Treatment System. However,
and notwithstanding the foregoing, said term includes only
those facilities which are acquired or constructed with pro-
ceeds from the sale of Bonds issued, or payments made, pursuant
to this Contract. Said term does not include any part of the
Treatment System or any facilities acquired or constructed by
the District with the proceeds from the issuance of "Special
Facilities Bonds", which are hereby defined as being revenue
obligations of the District which are not secured by or payable
from Annual Payments made under this Contract and similar
contracts with Additional Contracting Parties, and which are
payable solely from other sources.
(1) "Operation and Maintenance Expenses" means all costs
and expenses of operation and maintenance of the Interceptor
System, including (for greater certainty but without limiting
the generality of the foregoing) repairs and replacements for
4
which no special fund is created in the Bond Resolutions,
operating personnel, the cost of utilities, the costs of
supervision, engineering, accounting, auditing, legal services,
supplies, services, administration of the Interceptor System,
including the District's general overhead expenses attributable
to the Interceptor System, insurance premiums, equipment
necessary for proper operation and maintenance of the Inter-
ceptor System, and payments made by the District in satisfac-
tion of judgments resulting from claims not covered by the
District's insurance arising in connection with the operation
and maintenance of the Interceptor System. The term also
includes the charges of the bank or banks and other entities
acting as paying agents and/or registrars for any Bonds. The
term does not include depreciation.
(m) "Treatment Contracts" means the "Treatment Contracts"
as defined in the preamble to this Contract, and includes all
contracts, and all amendments thereto or replacements thereof,
heretofore or hereafter entered into between or among the
Contracting Parties and the District with respect to the
Treatment System, with such existing contracts being described
as follows:
Trinity East Fork Regional Wastewater System Contract,
dated as of October 1, 1975 among the Cities of
Mesquite and Plano and the District.
City of Richardson -Trinity East Fork Regional Wastewater
System Contract dated as of January 9, 1978, between the
City of Richardson and the District.
City of Allen -Trinity East Fork Regional Wastewater
System Contract, dated as of August 24, 1978, between
the City of Allen and the District, and
City of McKinney -Trinity East Fork Regional Wastewater
System Contract, dated as of August 29, 1979, between
the City of McKinney and the District.
(n) "Treatment System" means the District's "Treatment
System" as defined in the preamble to this Contract, and
includes all facilities acquired, constructed, or operated by
the District pursuant to the Treatment Contracts.
5
(o) "Wastewater" means Sewage, Industrial Waste, Munici-
pal Waste, Recreational Waste, and Agricultural Waste, together
with Properly Shredded Garbage and such Infiltration Water that
may be present, all as defined in the Texas Water Code.
Section 2. CONSULTING ENGINEERS; CONSTRUCTION OF INTER-
CEPTOR SYSTEM. The District and the Contracting Parties agree
that Shimek, Jacobs & Finklea shall be the Consulting Engineers
for Interceptor System, provided that the Consulting Engineers
may be changed at the option of the District. The District
agrees to use its best efforts to acquire and construct the
Interceptor System, and agrees that the Interceptor System will
be acquired and constructed in general accordance with the
Engineering Report. It is anticipated that such acquisition
and construction will be financed by the District through the
issuance of one or more series or issues of its Bonds payable
from and secured by Annual Payments made under this Contract,
and the District agrees to use its best efforts to issue its
Bonds for such purpose. The proceeds from the sale and de-
livery of such Bonds also will be used for the payment of the
District's expenses and costs in connection with the Inter-
ceptor System and the Bonds, including, without limitation, all
financing, legal, printing, and other expenses and costs
related to the issuance of such Bonds and the Interceptor
System.
Section 3. QUANTITY AND POINTS OF ENTRY. (a) In con-
sideration of the payments to be made by each Contracting Party
under this Contract, during each Annual Payment Period during
which the Interceptor System is in operation, each Contracting
Party shall or may discharge into the Interceptor System, at
its Point or Points of Entry hereinafter described, all of the
Wastewater which is required, or permitted to be, discharged
into the District's Treatment System by such Contracting Party
under the Treatment Contracts, subject to the restrictions
hereinafter stated; and provided that each such Contracting
N
Party must transport such Wastewater to its Point or Points of
Entry into the Interceptor System.
(b) The maximum rate at which Wastewater is discharged by
each Contracting Party at its Point or Points of Entry into the
Interceptor System shall not exceed for a period of sixty
minutes a rate which, if continued for a period of twenty-four
hours would equal 3.50 times such Contracting Party's estimated
average daily contributing flow of Wastewater into the Treat-
ment System for the then current Annual Payment Period. The
total quantity of Wastewater discharged into the Interceptor
System shall never exceed the amount which the Interceptor
System and the Treatment System are capable of receiving,
treating, and disposing, unless approved by the District,
subject to terms and conditions to be established by the
District. Notwithstanding the foregoing, no Contracting Party
shall ever make any discharge into the Interceptor System or
the Treatment System which would cause them to be overloaded or
be in violation of its permits from the State of Texas and/or
the United States of America.
(c) Wastewater meeting the quality requirements of
Section 4 of this Contract will be received into the Inter-
ceptor System at the Points of Entry, respectively, to be
established pursuant to mutual agreement between the District
and the affected Contracting Party. Additional Points of Entry
may be established by mutual agreement between the District and
a Contracting Party in the future if such additional Points of
Entry are determined by the District to be beneficial to the
Interceptor System.
(d) It is the intention of the Contracting Parties that
the Interceptor System shall be acquired, constructed, ex-
tended, and improved so that at all reasonable times it will be
capable of receiving and transporting all eligible Wastewater
of each Contracting Party which such Contracting Party is
required or permitted to discharge into the District's Treat-
ment System pursuant to the Treatment Contracts, and that the
7
District will from time to time issue its Bonds in such amounts
as are, within its judgment and discretion, sufficient to
achieve such results. It is further the intention of the
Contracting Parties that the District shall issue or use its
best efforts to issue its Bonds for such purpose, and to
provide improvements, enlargements, and extensions to the
Interceptor System as needed, for the Initial Contracting
Parties, and as needed by Additional Contracting Parties.
Section 4. QUALITY. Each Contracting Party shall dis-
charge into the Interceptor System only such Wastewater as it
is required or permitted to discharge into the District's
Treatment System, and will not discharge into the Interceptor
System any wastes prohibited by the Treatment Contracts.
Section 5. METERING OF WASTEWATER. The District will
furnish, install, operate, and maintain at its expense the
necessary equipment and devices of standard type required for
measuring properly all Wastewater discharged into the Dis-
trict's Treatment System by each Contracting Party, respect-
ively, under the Treatment Contracts. Such meters and other
equipment shall remain the property of the District. Each
Contracting Party shall have access to such metering equipment
at all reasonable times for inspection and examination, but the
reading, calibration, and adjustment thereof shall be done only
by employees or agents of the District in the presence of a
representative of the affected Contracting Party or Parties if
requested by such Contracting Party or Parties. All readings
of meters will be entered upon proper books of record main-
tained by the District. Upon written request any Contracting
Party may have access to said record books during reasonable
business hours. Not more than three times in each year of
operation, the District shall calibrate its meters, if re-
quested in writing by the affected Contracting Party or Parties
to do so, in the presence of a representative of such Contract-
ing Party or Parties, and such parties shall jointly observe
1.9
any adjustments which are made to the meters in case any
adjustment is found to be necessary. If, for any reason, any
meters are out of service or out of repair, or if, upon any
test, the percentage of inaccuracy of any meter is found to be
in excess of five (5%) per cent, registration thereof shall be
corrected for a period of time extending back to the time when
such inaccuracy began, if such time is ascertainable, and if
not ascertainable, then for a period extending back one-half
(1/2) of the time elapsed since the date of the last calibra-
tion, but in no event further back than a period of six (6)
months. Any Contracting Party may, at its option and its own
expense, install and operate a check meter to check each meter
installed by the District, but the measurement for the purpose
of this agreement shall be solely by the District's meters,
except as in this Section specifically provided to the con-
trary. All such check meters shall be of standard make and
shall be subject at all reasonable times to inspection and
examination by any employee or agent of the District, but the
reading, calibration, and adjustment thereof shall be made only
by the Contracting Party or Parties, except during any period
when a check meter may be used under specific written consent
by the District for measuring the amount of Wastewater de-
livered into the Treatment System, in which case the reading,
calibration, and adjustment thereof shall be made by the
District with like effect as if such check meter or meters had
been furnished or installed by the District.
Section 6. UNIT OF MEASUREMENT. The unit of measurement
for Wastewater discharged into the Interceptor System and the
Treatment System shall be 1,000 gallons, U. S. Standard Liquid
Measure.
Section 7. LIABILITY FOR DAMAGES AND RESPONSIBILITY FOR
WASTEWATER. Liability for damages arising from the transporta-
tion, delivery, reception, treatment, and/or disposal of all
Wastewater discharged into the Interceptor System hereunder
i
shall remain in each Contracting Party to its Point or Points
of Entry, respectively, into the Interceptor System, and title
to such Wastewater shall be in such Contracting Party to such
Point or Points, and upon passing through Points of Entry
liability for such damages shall pass to the District. As
between the District and each Contracting Party, each party
agrees to indemnify and to save and hold the other party
harmless from any and all claims, demands, causes of action,
damages, losses, costs, fines, and expenses, including reason-
able attorney's fees, which may arise or be asserted by anyone
at any time on account of the transportation, delivery, recep-
tion, treatment, and/or disposal while title to the Wastewater
is in such party, or on account of a prohibited discharge by a
Contracting Party. The District has the responsibility as
between the parties for the proper reception, transportation,
treatment, and disposal of all Wastewater discharged into the
Interceptor System, but not for prohibited discharges dis-
charged by any party at any Point of Entry.
Section 8. OTHER CONTRACTS. (a) The District reserves
the right to enter into contracts to provide the Wastewater
transportation services of the Interceptor System to Additional
Contracting Parties under contracts similar to this Contract,
subject to the requirements concerning "minimums" and other
matters as hereinafter provided; provided, however, that prior
to or concurrently with becoming an Additional Contracting
Party under this Contract such party must enter into a Treat-
ment Contract with the District in connection with the Treat-
ment System. Each contract with any Additional Contracting
Party shall comply with the requirements of this Contract,
shall substantially restate the essential provisions of this
Contract, and shall be structured to be similar hereto to the
fullest extent applicable and practicable, with such additions
or changes as are necessary to meet the actual circumstances,
with the effect that each Additional Contracting Party will
10
substantially adopt the provisions of this Contract, as supple-
mented and necessarily changed by its contract. However, the
District shall not obligate itself to receive Wastewater into
the Interceptor System from any future Additional Contracting
Party if, in the judgment and discretion of the District, such
obligation would jeopardize the District's ability to meet its
obligation to receive and transport Wastewater discharged into
the Interceptor System by prior Contracting Parties, including
specifically the Initial Contracting Parties.
(b) Notwithstanding the foregoing a party may become an
Additional Contracting Party only in the following manner and
under the following conditions:
(i) A formal request must be submitted to the
District by the proposed Additional Contracting Party
furnishing information on the area to be served, a de-
scription of existing facilities, and the latest annual
audit of such proposed Additional Contracting Party's
waterworks and/or sewer systems, if any.
(ii) Such proposed Additional Contracting Party must
provide funds for any necessary engineering studies if
funds are not available therefor from the appropriate
Federal or State agencies. The preliminary studies must
determine or estimate, for the ensuing five year period,
the size and type of any proposed improvements, enlarge-
ments, or extensions to the Interceptor System to serve
such Additional Contracting Party, their estimated cost,
and estimated flows of Wastewater, so as to enable the
District to ascertain or estimate the requirements of the
proposed Additional Contracting Party for the ensuing five
year period.
(iii) After all preliminary data is developed, the
Board of Directors of the District shall call for a
hearing on the matter and notify all Contracting Parties
to review the request of the proposed Additional
11
Contracting Party. The Board of Directors of the District
then shall determine if the proposed Additional Contract-
ing Party should become an Additional Contracting Party.
If so determined, the Board of Directors then may author-
ize the District to enter into the required contract with
such Additional Contracting Party as provided in this
Contract, and may authorize any Bonds required in connec-
tion with such Additional Contracting Party.
(iv) Each such contract with an Additional Contract-
ing Party must provide for minimum payments under its
contract, on the basis of estimated annual minimum flows
into the District's Treatment System, that would provide
amounts annually at least sufficient, as determined by the
District, to pay that portion of the annual Operation and
Maintenance Component of the Annual Requirement which is
attributable to that part of the Interceptor System
provided by the District to serve such Additional Con-
tracting Party, and to pay that portion of the Bond
Service Component of each Annual Requirement attributable
to Bonds issued within five years from the date of such
contract to acquire or improve any new and additional
facilities for the Interceptor System to serve in whole or
in part such Additional Member City, plus a percentage of
the Bond Service Component of each future Annual Require-
ment for all then outstanding Bonds equal to the then
estimated percentage of use by such proposed Additional
Contracting Party of any portion of the then existing
Interceptor System.
(c) It is further recognized and agreed that in the
future the District may provide services of the Interceptor
System to parties which are not Additional Contracting Parties,
provided that all such services of the Interceptor System to
parties which are not Additional Contracting Parties shall in
all respects be subordinate to the prior rights of the
12
Contracting Parties, and all contracts or other arrangements
relating to such services shall recognize, and be made subordi-
nate to, such prior rights.
Section 9. FISCAL PROVISIONS. (a) Subject to the terms
and provisions of this Contract, the District will provide and
pay for the cost of the acquisition and construction of all
Interceptor System facilities, by using its best efforts to
issue its Bonds in amounts which will be sufficient to accom-
plish such purposes, and the District will own and operate the
Interceptor System. It is acknowledged and agreed that pay-
ments to be made under this Contract and similar contracts with
Additional Contracting Parties, if any, will be the basic
source available to the District to provide the Annual Require-
ment, and that, in compliance with the District's duty to fix
and from time to time revise the rates of compensation or
charges for services of the Interceptor System rendered and
made available by the District, the Annual Requirement will
change from time to time, and that each such Annual Requirement
shall be allocated among the Contracting Parties as hereinafter
provided, and that the Annual Requirement for each Annual
Payment Period shall be provided for in each Annual Budget and
shall at all times be not less than an amount sufficient to pay
or provide for the payment of:
(A) An "Operation and Maintenance Component" equal to the
amount paid or payable for all Operation and Mainte-
nance Expenses of the Interceptor System; and
(B) A "Bond Service Component" equal to:
(1) the principal of, redemption premium, if any,
and interest on, its Bonds, as such principal,
redemption premium, if any, and interest become
due, less interest to be paid out of Bond
proceeds or from other sources if permitted by
any Bond Resolution, and all amounts required to
redeem any Bonds prior to maturity when and as
13
provided in any Bond Resolution; and
(2) the proportionate amount of any special,
contingency, or reserve funds required to be
accumulated and maintained by the provisions of
any Bond Resolution; and
(3) any amount in addition thereto sufficient to
restore any deficiency in any of such funds
required to be accumulated and maintained by the
provisions of any Bond Resolution.
Section 10. ANNUAL BUDGET. Each Annual Budget for the
Interceptor System shall always provide for amounts sufficient
to pay the Annual Requirement. On or before July 1 of each
fiscal year during the term of this Contract, commencing with
July 1, 1984, the District shall furnish to each Contracting
Party a preliminary estimate of the Annual Payment required
from each Contracting Party for the next following Annual
Payment Period. Not less than forty days before the commence-
ment of each such Annual Payment Period under this Contract
the District shall cause to be prepared as herein provided its
preliminary budget for the Interceptor System for the next
ensuing Annual Payment Period, which budget shall specifically
include the Operation and Maintenance Component and the Bond
Service Component. A copy of such preliminary budget shall be
filed with each Contracting Party together with an estimated
schedule of monthly payments to be made by each Contracting
Party. The preliminary budget shall be subject to examination,
at reasonable times during business hours, at the office of the
City Secretary of each Contracting Party. If no protest or
request for a hearing on such preliminary budget is presented
to the District within thirty days after such filing of the
preliminary budget by one or more Contracting Parties or by the
owners of a minimum of 25% in principal amount of the Bonds
then outstanding, the preliminary budget for the Interceptor
System shall be considered for all purposes as the "Annual
14
Budget" for the next ensuing Annual Payment Period. But if
protest or request for a hearing is duly filed, it shall be the
duty of the District to fix the date and time for a hearing on
the preliminary budget, and to give not less than ten days
notice thereof to the Contracting Parties. An appropriate
Committee of the District shall consider the testimony and
showings made in such hearing and shall report its findings to
the Board of Directors of the District. The Board of Directors
may adopt the preliminary budget or make such amendments
thereof as to it may seem proper. The budget thus approved by
the Board of Directors of the District shall be the Annual
Budget for the next ensuing Annual Payment Period. The Annual
Budget may be amended by the District at any time to transfer
from one division thereof to another funds which will not be
needed by such division. The amount for any division, or the
amount for any purpose, in the Annual Budget may be increased
through formal action by the Board of Directors of the District
even though such action might cause the total amount of the
Annual Budget to be exceeded; provided that such action shall
be taken only in the event of an emergency or special circum-
stances which shall be clearly stated in a resolution at the
time such action is taken by the Board of Directors. Certified
copies of the amended Annual Budget and resolution shall be
filed immediately by the District with each Contracting Party.
Section 11. PAYMENTS BY CONTRACTING PARTIES. (a) For
the Wastewater transportation services to be provided to the
Contracting Parties under this Contract, each of the Contract-
ing Parties agrees to pay, at the time and in the manner
hereinafter provided, its proportionate share of the Annual
Requirement, which shall be determined as herein described and
shall constitute a Contracting Party's Annual Payment. Each of
the Contracting Parties shall pay its part of the Annual
Requirement for each Annual Payment Period directly to the
District, in monthly installments, on or before the 10th day of
15
each month, in accordance with the schedule of payments fur-
nished by the District, as hereinafter provided.
(b) For each Annual Payment Period each Contracting
Party's proportionate share of the Annual Requirement shall be
a percentage obtained by dividing the number of gallons of
contributing flow of Wastewater estimated to be discharged into
the District's Treatment System by such Contracting Party
pursuant to the Treatment Contracts during such Annual Payment
Period, as determined by the District after consultation with
such Contracting Party, by the aggregate total number of
gallons of contributing flow of Wastewater estimated to be
discharged into the District's Treatment System by all Con-
tracting Parties pursuant to the Treatment Contracts during
such period, as determined by the District after consultation
with all of the Contracting Parties. All such payments for
each Annual Payment Period shall be made in accordance with a
written schedule of payments for the appropriate Annual Payment
Period which will be supplied to each of the Contracting
Parties by the District. At the close of each Annual Payment
Period the District shall determine the actual metered number
of gallons of contributing flow of Wastewater discharged into
the District's Treatment System by each Contracting Party
pursuant to the Treatment Contracts during said period and
determine each Contracting Party's actual percentage of the
Annual Requirement by dividing such Contracting Party's actual
metered contributing flow into the Treatment System by the
actual metered contributing flow of all Contracting Parties
into the Treatment System. Each Contracting Party's Adjusted
Annual Payment shall be calculated by multiplying each such
Contracting Party's redetermined percentage times the actual
Annual Requirement. The difference between the amounts which
actually have been paid by each Contracting Party and the
amounts actually due from such Contracting Party hereunder
shall be applied as a credit or a debit to such Contracting
16
Party's account with the District and shall be credited or
debited to such Contracting Party's next monthly payment or
payments, or as otherwise agreed between the District and the
affected Contracting Party, provided that all such credits and
debits shall be made in a timely manner not later than the end
of the next following Annual Payment Period.
(c) Notwithstanding the provisions of (b), above, and as
an exception thereto, it is agreed that if, during any Annual
Payment Period, the estimated and/or actual metered contribut-
ing flow of Wastewater into the District's Treatment System of
any Contracting Party pursuant to the Treatment Contracts is,
for any reason whatsoever, less than the minimum amount herein-
after prescribed and provided for it, such Contracting Party
shall pay its share of each Annual Requirement as if its
estimated and/or actual metered contributing flow of Wastewater
into the District's Treatment System pursuant to the Treatment
Contracts were such minimum amount. However, if such Contract-
ing Party's estimated and/or actual metered contributing flow
of Wastewater into the District's Treatment System is equal to
or in excess of such minimum amount, its share of all of each
Annual Requirement shall be calculated on the basis of esti-
mated and actual contributing flow as provided in (b), above.
All contracts with Additional Contracting Parties shall provide
for equitable minimums similar to those provided for below.
Such minimums shall be fixed in amounts as required by Section
8(b) hereof, as determined by the District, and also shall be
at least sufficient, as determined by the District, to assure
an initial annual payment by such Additional Contracting Party
for not less than the amount of its estimated contributing flow
of Wastewater into the District's Treatment System during the
first year of service under such contract. For the purpose of
calculating the minimum percentage of each Annual Requirement
for which each Initial Contracting Party is unconditionally
liable, without offset or counterclaim (also see Section 14
17
hereof), the contributing flow of Wastewater into the Dis-
trict's Treatment System of each Initial Contracting Party
pursuant to the Treatment Contracts, during each Annual Payment
Period, shall be deemed to be not less than the minimum amount
(regardless of whether or not such amount was actually dis-
charged into the District's Treatment System pursuant to the
Treatment Contracts) specified for such Initial Contracting
Party as follows:
City of Allen: gallons
City of McKinney:
City of Plano:
gallons
gallons
City of Richardson: gallons
(d) Notwithstanding the foregoing, the Annual Require-
ment, and each Contracting Party's share thereof shall be
redetermined, after consultation with each of the Contracting
Parties, at any time during any Annual Payment Period, to the
extent deemed necessary or advisable by the District, if:
(i) The District commences furnishing services of the
Interceptor System to an Additional Contracting Party
or Parties;
(ii) Unusual, extraordinary, or unexpected expenditures
for Operation and Maintenance Expenses are required
which are not provided for in the District's Annual
Budget for the Interceptor System or in any Bond
Resolution;
(iii) Operation and Maintenance Expenses are substantially
less than estimated;
(iv) The District issues Bonds which require an increase
in the Bond Service Component of the Annual Payment;
or
(v) The District receives either significantly more or
significantly less revenues or other amounts than
those anticipated.
18
(e) During each Annual Payment Period all revenues
received by the District from providing services of the Inter-
ceptor System to parties which are not Contracting Parties,
shall (i) first be credited to the Operation and Maintenance
Component of the Annual Requirement, and (ii) then any remain-
der credited to the Bond Service Component of the Annual
Requirement, with the result that such credits under (i) and
(ii), respectively, shall reduce, to the extent of such
credits, the amounts of such Components, respectively, which
otherwise would be payable by the Contracting Parties pursuant
to the method prescribed in (b) and (c), above. The District
may estimate all such credits which it expects to make during
each Annual Payment Period in calculating each Annual Payment.
(f) Each Contracting Party hereby agrees that it will
make payments to the District required by this Section on or
before the 10th day of each month of each Annual Payment
Period. If any Contracting Party at any time disputes the
amount to be paid by it to the District, such complaining party
shall nevertheless promptly make such payment or payments, but
if it is subsequently determined by agreement or court decision
that such disputed payments made by such complaining party
should have been less, or more, the District shall promptly
revise and reallocate the charges among all Contracting Parties
in such manner that such complaining party will recover its
overpayment or the District will recover the amount due it.
All amounts due and owing to the District by each Contracting
Party or due and owing to any Contracting Party by the District
shall, if not paid when due, bear interest at the rate of ten
(10) percent per annum from the date when due until paid. The
District shall, to the extent permitted by law, discontinue the
services of the Interceptor System to any Contracting Party
which remains delinquent in any payments due hereunder for a
period of sixty days, and shall not resume such services while
such Contracting Party is so delinquent. It is further
19
provided and agreed that if any Contracting Party should remain
delinquent in any payments due hereunder for a period of one
hundred twenty days, and if such delinquency continues during
any period thereafter, such Contracting Party's minimum amount
of gallons of Wastewater specified and described in (c), above,
shall be deemed to have been zero gallons during all periods of
such delinquency, for the purpose of calculating and redeter-
mining the percentage of each Annual Payment to be paid by the
non -delinquent Contracting Parties, and the District shall
redetermine such percentage on that basis in such event so that
the non -delinquent Contracting Parties collectively shall be
required to pay all of the Annual Requirement. However, the
District shall pursue all legal remedies against any such
delinquent Contracting Party to enforce and protect the rights
of the District, the other Contracting Parties, and the owners
of the Bonds, and such delinquent Contracting Party shall not
be relieved of the liability to the District for the payment of
all amounts which would have been due hereunder, in the absence
of the next preceding sentence. It is understood that the
foregoing provisions are for the benefit of the owners of the
Bonds so as to insure that all of the Annual Requirement will
be paid by the non -delinquent Contracting Parties during each
Annual Payment Period regardless of the delinquency of a
Contracting Party. If any amount due and owing by any Con-
tracting Party to the District is placed with an attorney for
collection, such Contracting Party shall pay to the District
all attorneys fees, in addition to all other payments provided
for herein, including interest.
(g) If, during any Annual Payment Period, any Contracting
Party's Annual Payment is redetermined in any manner as pro-
vided or required in this Section, the District will promptly
furnish such Contracting Party with an updated schedule of
monthly payments reflecting such redetermination.
20
Section 12. SPECIAL PROVISIONS. (a) The District will
continuously operate and maintain the Interceptor System in an
efficient manner and in accordance with good business and
engineering practices, and at reasonable cost and expense.
(b) The District agrees to carry fire, casualty, public
liability, and other insurance on the Interceptor System for
purposes and in amounts which ordinarily would be carried by a
privately owned utility company owning and operating such
facilities, except that the District shall not be required to
carry liability insurance except to insure itself against risk
of loss due to claims for which it can, in the opinion of the
District's legal counsel, be liable under the Texas Tort Claims
Act or any similar law or judicial decision. Such insurance
will provide, to the extent feasible and practicable, for the
restoration of damaged or destroyed properties and equipment,
to minimize the interruption of the services of such facili-
ties. All premiums for such insurance shall constitute an
Operation and Maintenance Expense of the Interceptor System.
(c) It is estimated that the Interceptor System will be
placed in operation as soon as practicable. It is expressly
understood and agreed, however, that any obligations on the
part of the District to acquire, construct, and complete the
Interceptor System and to provide the services of the Inter-
ceptor System to the Contracting Parties shall be (i) con-
ditioned upon the District's ability to obtain all necessary
permits, material, labor, and equipment, and upon the ability
of the District to finance the cost of the Interceptor System
through the actual sale of the District's Bonds and (ii)
subject to all present and future valid laws, orders, rules,
and regulations of the United States of America, the State of
Texas, and any regulatory body having jurisdiction.
(d) The District shall never have the right to,demand
payment by any Contracting Party of any obligations assumed by
it or imposed on it under and by virtue of this Contract from
21
funds raised or to be raised by taxes, and the obligations
under this Contract shall never be construed to be a debt of
such kind as to require any of the Contracting Parties to levy
and collect a tax to discharge such obligation.
(e) Each of the Initial Contracting Parties, respect-
ively, represents and covenants that all payments, including
indemnity payments, to be made by it under this Contract shall
constitute reasonable and necessary "operating expenses" of its
combined waterworks and sewer system, as defined in Vernon's
Ann. Tex. Civ. St. Article 1113, and that all such payments
will be made from the revenues of its combined waterworks and
sewer system. Each of the Contracting Parties, respectively,
represents and has determined that the services to be provided
by the Interceptor System are absolutely necessary and essen-
tial to the present and future operation of its combined water
and sewer system, and that the Interceptor System constitutes
the reasonable and necessary method for transporting its
Wastewater into the District's Treatment System, and, accord-
ingly, all payments required by this Contract to be made by
each Contracting Party shall constitute reasonable and neces-
sary operating expenses of its combined water and sewer system
as described above, with the effect that the obligation to make
such payments from revenues of such combined water and sewer
system shall have priority over any obligation to make any
payments from such revenues of principal, interest, or other-
wise, with respect to all bonds or other obligations heretofore
or hereafter issued by such Contracting Party.
(f) Each of the Contracting Parties agrees throughout the
term of this Contract to continuously operate and maintain its
combined waterworks and sewer system and to fix and collect
such rates and charges for water and sewer services and/or
sewer services to be supplied by its combined waterworks and
sewer system as aforesaid as will produce revenues in an amount
equal to at least (i) all of the expenses of operation and
22
maintenance expenses of such system, including specifically its
payments under this Contract, and (ii) all other amounts as
required by law and the provisions of the ordinances or resolu-
tions authorizing its revenue bonds or other obligations now or
hereafter outstanding, including the amounts required to pay
all principal of and interest on such bonds and other obliga-
tions.
Section 13. FORCE MAJEURE. If by reason of force majeure
any party hereto shall be rendered unable wholly or in part to
carry out its obligations under this Contract, other than the
obligation of each Contracting Party to make the payments
required under Section 11 of this Contract, then if such party
shall give notice and full particulars of such force majeure in
writing to the other parties within a reasonable time after
occurrence of the event or cause relied on, the obligation of
the party giving such notice, so far as it is affected by such
force majeure, shall be suspended during the continuance of the
inability then claimed, but for no longer period, and any such
party shall endeavor to remove or overcome such inability with
all reasonable dispatch. The term "Force Majeure" as employed
herein shall mean acts of God, strikes, lockouts, or other
industrial disturbances, acts of public enemy, orders of any
kind of the Government of the United States or the State of
Texas, or any Civil or military authority, insurrection, riots,
epidemics, landslides, lightning, earthquake, fires, hurri-
canes, storms, floods, washouts, droughts, arrests, restraint
of government and people, civil disturbances, explosions,
breakage or accidents to machinery, pipelines or canals,
partial or entire failure of water supply, or on account of any
other causes not reasonably within the control of the party
claiming such inability.
Section 14. UNCONDITIONAL OBLIGATION TO MAKE PAYMENTS.
Recognizing the fact that the Contracting Parties urgently
require the facilities and services of the Interceptor System,
23
and that such facilities and services are essential and neces-
sary for actual use and for standby purposes, and recognizing
the fact that the District will use payments received from the
Contracting Parties to pay and secure its Bonds, it is hereby
agreed that each of the Contracting Parties shall be uncon-
ditionally obligated to pay, without offset or counterclaim,
its proportionate share of the Annual Requirement, as provided
and determined by this Contract (including the obligations for
paying for "minimums" as described in Section 11 hereof),
regardless of whether or not the District actually acquires,
constructs, or completes the Interceptor System or is actually
operating or providing services of the Interceptor System to
any Contracting Party hereunder, or whether or not any Con-
tracting Party actually uses the services of the Interceptor
System whether due to Force Majeure or any other reason whatso-
ever, regardless of any other provisions of this or any other
contract or agreement between any of the parties hereto. This
covenant by the Contracting Parties shall be for the benefit of
and enforceable by the holders of the Bonds and/or the Dis-
trict.
Section 15. TERM OF CONTRACT; MODIFICATION; NOTICES;
STATE OR FEDERAL LAWS, RULES, ORDERS, OR REGULATIONS. (a)
This Contract shall be effective on and from the Contract Date,
and this Contract shall continue in force and effect until the
principal of and interest on all Bonds shall have been paid,
and thereafter shall continue in force and effect during the
entire useful life of the Interceptor System.
(b) Modification. No change, amendment, or modification
of this Contract shall be made or be effective which will
affect adversely the prompt payment when due of all moneys
required to be paid by each Contracting Party under the terms
of this Contract and no such change, amendment, or modification
shall be made or be effective which would cause a violation of
any provisions of any Bond Resolution.
24
(c) Addresses and Notice. Unless otherwise provided
herein, any notice, communication, request, reply, or advice
(herein severally and collectively, for convenience, called
"Notice") herein provided or permitted to be given, made, or
accepted by any party to any other party must be in writing and
may be given or be served by depositing the same in the United
States mail postpaid and registered or certified and addressed
to the party to be notified, with return receipt requested, or
by delivering the same to an officer of such party, or by
prepaid telegram when appropriate, addressed to the party to be
notified. Notice deposited in the mail in the manner herein-
above described shall be conclusively deemed to be effective,
unless otherwise stated herein, from and after the expiration
of three days after it is so deposited. Notice given in any
other manner shall be effective only if and when received by
the party to be notified. For the purposes of notice, the
addresses of the parties shall, until changed as hereinafter
provided, be as follows:
If to the District, to:
North Texas Municipal Water District
P. O. Drawer C
Wylie, Texas 75098
If to the Initial Contracting Parties, as follows:
City of Allen
One Butler Circle
Allen, Texas 75002
City of McKinney
130 South Chestnut
McKinney, Texas 75069
City of Plano
1520 Avenue K
Plano, Texas 75074
City of Richardson
411 W. Arapaho Road
Richardson, Texas 75080
The parties hereto shall have the right from time to time and
at any time to change their respective addresses and each shall
have the right to specify as its address any other address by
25
cumulative. Recognizing however, that the District's under-
taking to provide and maintain the services of the Interceptor
System is an obligation, failure in the performance of which
cannot be adequately compensated in money damages alone, the
District agrees, in the event of any default on its part, that
each Contracting Party shall have available to it the equitable
remedy of mandamus and specific performance in addition to any
other legal or equitable remedies (other than termination)
which may also be available. Recognizing that failure in the
performance of any Contracting Party's obligations hereunder
could not be adequately compensated in money damages alone,
each Contracting Party agrees in the event of any default on
its part that the District shall have available to it the
equitable remedy of mandamus and specific performance in
addition to any other legal or equitable remedies (other than
termination) which may also be available to the District.
Notwithstanding anything to the contrary contained in this
Contract, any right or remedy or any default hereunder, except
the right of the District to receive the Annual Payment which
shall never be determined to be waived, shall be deemed to be
conclusively waived unless asserted by a proper proceeding at
law or in equity within two (2) years plus one (1) day after
the occurrence of such default. No waiver or waivers of any
breach or default (or any breaches or defaults) by any party
hereto or of performance by any other party of any duty or
obligation hereunder shall be deemed a waiver thereof in the
future, nor shall any such waiver or waivers be deemed or
construed to be a waiver of subsequent breaches or defaults of
any kind, character, or description, under any circumstances.
Section 18. VENUE. All amounts due under this Contract,
including, but not limited to, payments due under this Contract
or damages for the breach of this Contract, shall be paid and
be due in Collin County, Texas, which is the County in which
the principal administrative offices of the District are
27
at least fifteen (15) days' written notice to the other parties
hereto.
(d) State or Federal Laws, Rules, Orders, or Regulations.
This Contract is subject to all applicable Federal and State
laws and any applicable permits, ordinances, rules, orders, and
regulations of any local, state, or federal governmental
authority having or asserting jurisdiction, but nothing con-
tained herein shall be construed as a waiver of any right to
question or contest any such law, ordinance, order, rule, or
regulation in any forum having jurisdiction.
Section 16. SEVERABILITY. The parties hereto specifical-
ly agree that in case any one or more of the sections, subsec-
tions, provisions, clauses, or words of this Contract or the
application of such sections, subsections, provisions, clauses,
or words to any situation or circumstance should be, or should
be held to be, for any reason, invalid or unconstitutional,
under the laws or constitutions of the State of Texas or the
United States of America, or in contravention of any such laws
or constitutions, such invalidity, unconstitutionality, or
contravention shall not affect any other sections, subsections,
provisions, clauses, or words of this Contract or the applica-
tion of such sections, subsections, provisions, clauses, or
words to any other situation or circumstance, and it is in-
tended that this Contract shall be severable and shall be
construed and applied as if any such invalid or unconstitu-
tional section, subsection, provision, clause, or word had not
been included herein, and the rights and obligations of the
parties hereto shall be construed and remain in force accord-
ingly.
Section 17. REMEDIES UPON DEFAULT. It is not intended
hereby to specify (and this Contract shall not be considered as
specifying) an exclusive remedy for any default, but all such
other remedies (other than termination) existing at law or in
equity may be availed of by any party hereto and shall be
26
located. It is specifically agreed among the parties to this
Contract that Collin County, Texas, is the place of performance
of this Contract; and in the event that any legal proceeding is
brought to enforce this Contract or any provision hereof, the
same shall be brought in Collin County, Texas.
IN WITNESS WHEREOF, the parties hereto acting under
authority of their respective governing bodies have caused this
Contract to be duly executed in several counterparts, each of
which shall constitute an original, all as of the day and year
first above written, which is the date of this Contract.
NORTH TEXAS MUNICIPAL WATER DISTRICT
BY
President, Board of Directors
ATTEST:
Secretary, Board of Directors
(DISTRICT SEAL)
CITY OF ALLEN, TEXAS
BY 0
Mayor
ATTEST:
ma-� �"N-L:�a4
City S retary
(CITY SEAL)
ATTEST:
City Secretary
(CITY SEAL)
CITY OF McKINNEY, TEXAS
BY
Mayor
28
ATTEST:
City Secretary
(CITY SEAL)
ATTEST:
City Secretary
(CITY SEAL)
CITY OF PLANO, TEXAS
BY
Mayor
CITY OF RICHARDSON, TEXAS
BY
- Mayor
29
NORTH TEXAS MUNICIPAL; WATER DISTRICT
REGIONAL WATER SUPPLY FACILITIES AMENDATORY CONTRACT
THE STATE OF TEXAS
NORTH TEXAS MUNICIPAL WATER DISTRICT :
THIS AMENDATORY CONTRACT (the "Contract") made and entered
into as of the 1st day of AUGUST, 1988 (the "Contract Date"),
by and between NORTH TEXAS MUNICIPAL WATER DISTRICT (the
"District"), a conservation and reclamation district and
political subdivision of the State of Texas, created and
functioning under Article 16, Section 59, of the Texas Consti-
tution, pursuant to Chapter 62, Acts of the 52nd Legislature,
Regular Session, 1951, as amended (the "District Act"), and the
following:
CITY OF FARMERSVILLE, IN COLLIN COUNTY, TEXAS,
CITY OF FORNEY, IN KAUFMAN COUNTY, TEXAS,
CITY OF GARLAND, IN DALLAS COUNTY, TEXAS
CITY OF McKINNEY, IN COLLIN COUNTY,
CITY OF MESQUITE, IN DALLAS COUNTY, TEXAS,
CITY OF PLANO, IN COLLIN AND DENTON COUNTIES, TEXAS,
CITY OF PRINCETON, IN COLLIN COUNTY, TEXAS,
CITY OF RICHARDSON, IN DALLAS AND COLLIN COUNTIES, TEXAS,
CITY OF ROCKWALL, IN ROCKWALL COUNTY, TEXAS, and
.CITY OF ROYSE CITY, IN ROCKWALL AND COLLIN COUNTIES, TEXAS,
CITY OF WYLIE, I
(collectively the "Initial Contracting Parties").
W I T N E S S _ET H
WHEREAS, each of the Initial Contracting Parties is a duly
incorporated city and political subdivision of the State of
Texas operating under the Constitution and laws of the State of
Texas; and
1
,F . it V
Initial Contracting Parties and do not affect the unconditional
obligations of such parties with respect to the System and
Bonds; and
WHEREAS, it is expected by the parties hereto that after
the execution of this Contract, Bonds for parts of the Projects
will be issued as soon as deemed advisable and necessary by the
District.
NOW, THEREFORE, in consideration of the mutual covenants
and agreements herein contained, the District agrees to use its
best efforts to acquire, construct, and complete the Projects
and other System facilities, when and as the District deems it
advisable, and to supply treated water to Contracting Parties
and others from the System, upon and subject to the terms and
conditions hereinafter set forth, and, subject to the provi-
sions of Section 13(b) and (c) hereof, the District and the
Initial Contracting Parties agree that each of the eleven
presently existing treated water supply contracts described
above between the District and the Initial Contracting Parties
are hereby amended, modified, combined, and consolidated so as
henceforth to be in their entirety and for all purposes as
follows, to -wit:
Section 1. DEFINITION OF TERMS. The following terms and
expressions as used in this Contract, unless the context
clearly shows otherwise, shall have the following meanings:
5
NORTH TEXAS MUNICIPAL WATER DISTRICT
REGIONAL WATER SUPPLY FACILITIES AMENDATORY CONTRACT
THE STATE OF TEXAS
NORTH TEXAS MUNICIPAL WATER DISTRICT :
THIS AMENDATORY CONTRACT (the "Contract") made and entered
into as of the 1st day of AUGUST, 1988 (the "Contract Date"),
by and between NORTH TEXAS MUNICIPAL WATER DISTRICT (the
"District"), a conservation and reclamation district and
political subdivision of the State of Texas, created and
functioning under Article 16, Section 59, of the Texas Consti-
tution, pursuant to Chapter 62, Acts of the 52nd Legislature,
Regular Session, 1951, as amended (the "District Act"), and the
following:
CITY OF FARMERSVILLE, IN COLLIN COUNTY, TEXAS,
CITY OF FORNEY, IN KAUFMAN COUNTY, TEXAS,
CITY OF GARLAND, IN DALLAS COUNTY, TEXAS
CITY OF MCKINNEY, IN COLLIN COUNTY, TEXAS,
CITY OF MESQUITE, IN DALLAS COUNTY, TEXAS,
CITY OF PLANO, IN COLLIN AND DENTON COUNTIES, TEXAS,
CITY OF PRINCETON, IN COLLIN COUNTY, TEXAS,
CITY OF RICHARDSON, IN DALLAS AND COLLIN COUNTIES, TEXAS,
CITY OF ROCKWALL, IN ROCKWALL COUNTY, TEXAS,
CITY OF ROYSE CITY, IN ROCKWALL AND COLLIN COUNTIES, TEXAS, and
CITY OF WYLIE, IN COLLIN COUNTY, TEXAS
(collectively the "Initial Contracting Parties").
W I T N E S S E T H
WHEREAS, each of the Initial Contracting Parties is a duly
incorporated city and political subdivision of the State of
Texas operating under the Constitution and laws of the State of
Texas; and
1
WHEREAS, the District and the Initial Contracting Parties
are authorized to enter into this Contract pursuant to the
District Act, Vernon's Ann. Tex. Civ. St. Article 4413(32c)
(the "Interlocal Cooperation Act"), and other applicable laws;
and
WHEREAS, the District presently owns water rights in Lavon
Reservoir on the East Fork of the Trinity River in Collin
County, Texas, and owns and operates other water supply and
treatment facilities which serve the Initial Contracting
Parties (the "Existing System"); and
WHEREAS, the District has duly issued and delivered the
following described bonds (the "Outstanding Bonds") which were
issued to acquire and construct, and to refund bonds issued to
acquire and construct, the Existing System:
North Texas Municipal Water District Water System Revenue
Bonds, Series 1985, dated August 1, 1985, now outstanding
in the aggregate principal amount of $78,967,321.45; and
North Texas Municipal Water District Water System Revenue
Bonds, Series 1987, dated March 1, 1987, now outstanding
in the aggregate principal amount of $24,565,000; and
WHEREAS, the District presently supplies and sells treated
water from the Existing System to the Initial Contracting
Parties under eleven separate treated water supply contracts,
including various amendments thereto, now in effect; and it is
acknowledged and agreed that the Existing System is inadequate
to provide known future treated water requirements of the
Initial Contracting Parties, thus making this Contract
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necessary to enable the District to acquire and construct
additional treated water supply and treatment facilities and
make it possible for the District to supply such requirements;
and
WHEREAS, the existing treated water supply contracts
recognize that the District has assumed the responsibility for
supplying all treated water needs of the Initial Contracting
Parties; and
WHEREAS, each of said existing treated water supply
contracts originally was dated as of December 12, 1953, except
for the City of Richardson contract originally dated as of
April 7, 1965, and each is similar in form and substance, and
such contracts, including all amendments thereto, collectively
presently provide the principal source and security for the
payment of the District's Outstanding Bonds; and
WHEREAS the District proposes to acquire, construct, and
complete additional surface water supply and treatment facili-
ties from the following additional sources: Lake Texoma on the
Red River, Cooper Dam and Reservoir in Hopkins and Delta
Counties, Texas, a proposed new Bonham Dam and Reservoir in
Fannin County, Texas, and other facilities wherever located to
enable the District to supply treated water as needed to
Contracting Parties and others (the "Projects"); and
WHEREAS, it is deemed necessary and advisable by the
parties hereto that each of the eleven separate existing
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treated water supply contracts, and amendments thereto, between
the District and each Initial Contracting Party be amended and
completely replaced with this single Contract so that the
entire relationship between the District and all of the
Initial Contracting Parties with respect to the System and the
Bonds (as such terms are hereinafter defined) will be set forth
in this Contract; and
WHEREAS, it is specifically represented, certified, and
covenanted by the District that none of the amendments or
modifications to the aforesaid existing treated water supply
contracts with the Initial Contracting Parties which will occur
as a result of entering into this Contract will in any way have
an adverse affect on the operation of the System or the rights
of the owners of any Bonds; and that this Contract will provide
security for the owners of -all Bonds and obligate the Initial
Contracting Parties to make and assume unconditional specific
payments with respect to the System and the Bonds; and
WHEREAS, the provisions of this Contract are similar in
concept, essence, and intent to the provisions of the aforesaid
existing treated water supply contracts and basically restate,
reorganize, and expand same, including certain clarifications
and updating, and establishing certain billing procedures and
adjustments between the parties with respect to the use of, and
payments with respect to, treated water from the System, which
billing procedures and adjustments are solely between the
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Initial Contracting Parties and do not affect the unconditional
obligations of such parties with respect to the System and
Bonds; and
WHEREAS, it is expected by the parties hereto that after
the execution of this Contract, Bonds for parts of the Projects
will be issued as soon as deemed advisable and necessary by the
District.
NOW, THEREFORE, in consideration of the mutual covenants
and agreements herein contained, the District agrees to use its
best efforts to acquire, construct, and complete the Projects
and other System facilities, when and as the District deems it
advisable, and to supply treated water to Contracting Parties
and others from the System, upon and subject to the terms and
conditions hereinafter set forth, and, subject to the provi-
sions of Section 13(b) and (c) hereof, the District and the
Initial Contracting Parties agree that each of the eleven
presently existing treated water supply contracts described
above between the District and the.Initial Contracting Parties
are hereby amended, modified, combined, and consolidated so as
henceforth to be in their entirety and for all purposes as
follows, to -wit:
Section 1. DEFINITION OF TERMS. The following terms and
expressions as used in this Contract, unless the context
clearly shows otherwise, shall have the following meanings:
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(a) "Additional Contracting Party" means any party not
defined as one of the Initial Contracting Parties with which
the District makes a contract similar to this Contract for
supplying treated water from the System, provided that after
execution of any such contract such party shall become one of
the Contracting Parties for all purposes of this Contract.
(b) "Annual Payment" means the amount of money to be paid
to the District by each of the Contracting Parties during each
Annual Payment Period as its proportionate share of the Annual
Requirement.
(c) "Annual Payment Period" means the District's fiscal
year, which currently begins on October 1 of each calendar year
and ends on September 30 of the next following calendar year,
but which may be any twelve consecutive month period fixed by
the District; and the first Annual Payment Period under this
Contract shall be the period of October 1, 1988, through
September 30, 1989.
(d) "Annual Requirement" means the total amount of money
required for District to pay all Operation and Maintenance
Expenses of the System, and to pay the Bond Service Component
of the Annual Requirement as described in Section 9(a) hereof,
including debt service on its Bonds, and any sums required to
pay or restore any amounts required to be deposited in any
special or reserve funds required to be established and/or
maintained by the provisions of the Bond Resolutions.
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.4. .
(e) "Bond Resolution" means any resolution of the Dis-
trict which authorizes any Bonds.
(f) "Bonds" means the outstanding Bonds listed in the
preamble to this Contract, and all bonds hereafter issued by
the District, whether in one or more series or issues, and the
interest thereon, to acquire, construct, complete, improve,
and/or extend the System or any System facilities, including
the Projects, and/or otherwise to improve or extend the System,
and any bonds issued to refund any Bonds or to refund any such
refunding bonds.
(g) "Contracting Parties" means the "Initial Contracting
Parties", as defined in the first paragraph of this Contract,
together with any other party or parties which hereafter
becomes one of the Contracting Parties by becoming an Addition-
al Contracting Party.
(h) "Contracting Party" means any one of the Contracting
Parties.
(i) "District" means the "District" as defined in the
preamble to this Contract.
(j) "Existing System" means the "Existing System" as
defined in the preamble to this Contract.
(k) "MGD" is an abbreviation for "million gallons of
water per day" and means a quantity of water during a period of
time expressed for convenience in terms of an average annual
daily quantity during an Annual Payment Period. The value of 2
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MGD, for example, is calculated as follows: two million
gallons multiplied by the number of days in an Annual Payment
Period.
(1) "Operation and Maintenance Expenses" means all
reasonable costs and expenses of operation and maintenance of
the System, including (for greater certainty but without limit-
ing the generality of the foregoing) repairs and replacements,
operating personnel, the cost of utilities, the amounts
required to pay the U.S. Army Corps of Engineers or any other
federal, state, or local agency for water storage rights or
other interests in water in any reservoir, or for the purchase
of water, or for the use or operation of any property or
facilities, the costs of supervision, engineering, accounting,
auditing, legal services, insurance premiums, supplies,
services, administration of the System, and equipment necessary
for proper operation and maintenance of the System, and
payments made by District in satisfaction of judgments
resulting from claims not covered by District's insurance
arising in connection with the acquisition, construction,
operation, and maintenance of the System. The term also in-
cludes the charges of the bank or banks acting as paying agents
and/or registrars for any Bonds. The term does not include
depreciation.
(m) "Outstanding Bonds" means the Outstanding Bonds, as
defined in the preamble to this Contract.
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(n) "Projects" means the "Projects" as defined in the
preamble to this Contract.
(o) "System" means collectively the Existing System and
the Projects, and all of the District's existing water rights,
and water storage, treatment, transportation, distribution, and
supply facilities, including all dams, reservoirs, and other
properties or interests therein wherever located, which hereto-
fore have been acquired or constructed with the proceeds from
the sale of the Outstanding Bonds, or the bonds refunded by
same, or with any other bonds or other obligations of the
District payable from and secured by a lien on and pledge of
any part of the revenues of the System, or with revenues from
said System, together with all future improvements, enlarge-
ments, extensions, and additions to any of the foregoing, and
all future new facilities and/or water rights, which are
acquired or constructed with the proceeds from the sale of any
Bonds or revenues from the System, and any water supply or
treatment facilities which are deliberately and specifically,
at the option of the District, made a part of the System by
resolution of the Board of Directors of the District, and all
repairs to or replacements of the System. Said terms do not
include any District facilities which provide wastewater
treatment or disposal services, or solid waste disposal servic-
es, of any kind. Said terms do not include any facilities
acquired or constructed by the District with the proceeds from
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the issuance of "Special Facilities Bonds", which are hereby
defined as being revenue obligations of the District which are
not issued as Bonds (as hereinbefore defined), and which are
payable from any source, contract, or revenues whatsoever other
than revenues from the System.
(p) "treated water" means potable water treated to the
standards of quality specified in Section 5 of this Contract.
Such term does not include non -potable water such as wastewater
or other non -potable water derived, treated, or produced from
any source by any Contracting Party.
(q) "Water Year" means the period of August 1 of each
calendar year through July 31 of the next following calendar
year.
Section 2. CONSTRUCTION OF PROJECTS. The District agrees
to use its best efforts to issue its Bonds, payable from Annual
Payments under this Contract, to acquire and construct the
Projects and other System facilities when and as needed, as
determined by the District, to supply treated water to all
Contracting Parties. It is anticipated that such acquisition
and construction will be in phases and that each phase will be
financed by the District through the issuance of one or more
series or issues of its Bond$; and the District agrees to use
its best efforts to issue its Bonds for such purpose. Bonds
also may, at the discretion of the District, be issued to
refund any Bonds, and be issued to improve and/or extend
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any System facilities. The proceeds from the sale and delivery
of the Bonds may be used to fund debt service reserve funds or
contingency funds and interest during construction to the
extent deemed advisable by the District, and for the payment of
all of the District's expenses and costs in connection with any
Projects or other System facilities and the Bonds, including,
without limitation, all financing, legal, printing, and other
expenses and costs related to the Bonds and the Projects and
other System facilities.
Section 3. QUANTITY. (a) The District agrees to sell
and to deliver treated water under this Contract to each
Initial Contracting Party, respectively, at its Point or Points
of Delivery as described in Section 6 hereof, and each Initial
Contracting Party agrees to take at its Point or Points of
Delivery all treated water required for use by such Initial
Contracting Party during the term of this Contract, including
all treated water for such Initial Contracting Party's own use
and for distribution to all customers served by such Initial
Contracting Party's treated water distribution system, whether
inside or outside its boundaries. It is specifically provided,
however, that after the Contract Date, no Contracting Party
shall enter into, renew, or amend with regard to volume of
water to be supplied, any agreement to supply any such treated
water for use outside its boundaries or the area of its statu-
tory extraterritorial jurisdiction unless each such agreement
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is approved by the Board of Directors of the District (which
approval shall not be unreasonably withheld) and made subject
and subordinate in all respects to the water requirements of
all of the Contracting Parties collectively. No Contracting
Party shall become a party to any contract for the sale of
treated water which would violate or be inconsistent with the
provisions of this Contract, and all such contracts shall
recognize the priority of treated water use as provided in this
Contract. It is the intention of the parties hereto that the
System shall be the sole and exclusive source of all treated
water supply for each of the Contracting Parties. However,
notwithstanding the foregoing provisions of this subsection
(a), if, after the Contract Date, any Contracting Party should
legally and finally annex or consolidate with any territory
which has a source of treated water supply other than from such
Contracting Party, then the District and such Contracting Party
are authorized to, and may, negotiate and enter into agreements
which would allow the continued use of such other source within
such annexed territory upon such terms and conditions as are
mutually agreeable to the District and such Contracting Party,
and as an exception to the foregoing requirements with respect
to exclusivity. The District will use its best efforts to
furnish and remain in position to furnish treated water suffi-
cient for all reasonable treated water requirements of each
Contracting Party, but its obligation shall be limited to the
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amount of treated water available to it from the System; and
provided that the maximum rate of delivery shall be consistent
with the capacities and abilities of System facilities, and
shall not exceed the amounts fixed on an equitable and uniform
basis by the Board of Directors of the District. The District
agrees to use its best efforts to issue its Bonds in amounts
necessary to acquire, construct, maintain, improve, and extend
the entire System, including the Projects and other System
facilities, so as to enable the District to furnish such
treated water. As between the Contracting Parties, if treated
water from the System must be rationed such rationing shall,
within the limits permitted by law, be done by the District on
the basis of the relative actual total amount of all treated
water from the entire System taken by each such Contracting
Party, respectively, during the last preceding Annual Payment
Period in which rationing among said parties was not necessary.
(b) If the District is at any time during the term of
this Contract unable to supply all the treated water require-
ments of the Contracting Parties for any reason, or if it
should become apparent that the District will become unable to
supply the Contracting Parties with their water requirements,
and any Contracting Party determines that it is necessary to
procure treated water from sources other than the District,
then such Contracting Party shall give written notice to the
District of its intention and desire to procure treated water
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from sources other than the District, and its reasons therefor.
Unless, within sixty (60) days from the receipt by the District
of such written notice, the District shall object to such
procurement (such objection to be evidenced by a resolution
adopted by a vote of a majority of all members of the Dis-
trict's Board of Directors), then such Contracting Party may
proceed to procure such treated water from other sources at its
sole cost, and without any liability for damages accruing in
favor of or against the District by reason thereof. However,
such Contracting Party shall nevertheless continue to be
obligated to take from the District and pay for all treated
water at any time available to such Contracting Party from the
District's System up to the full treated water requirements of
such Contracting Party. In no event shall the taking of
treated water from a source other than the District relieve any
Contracting Party from making all payments due the District
under this Contract. Further, all Contracting Parties shall at
all times have the right to secure treated water from any
possible source (i) in any emergency when the District is
unable to deliver treated water from the System because of any
"Force Majeure" as defined in this Contract, or (ii) in any
other emergency situation, as determined by a Contracting Party
for a period not to exceed thirty days, or for any longer
period approved in writing by the District. Notwithstanding
the foregoing provisions of this Contract, any Contracting
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7
Party also may purchase treated water from a source other than
the System, if the District determines that such purchase is in
the best interests of the District and the Contracting Parties
and gives written approval to such purchase; and in such case,
for the purposes of this Contract, the District shall be deemed
to be the constructive purchaser of such water and such water
shall be deemed to be System water, and the District shall
either pay for said water on behalf of such Contracting Party
or reimburse such Contracting Party for the cost of such water,
and such Contracting Party shall pay the District for such
water the same as if it were regular System water.
Section 4. OTHER CONTRACTS. (a) The District reserves
the right to supply treated water from the System to Additional
Contracting Parties under contracts similar to this Contract,
subject to the requirements concerning "minimums" as provided
in Section 9(c) hereof. Each contract with any Additional Con-
tracting Party shall comply with the requirements of this
Contract, shall substantially restate the essential provisions
of this Contract, and shall be structured to be similar hereto
to the fullest extent applicable and practicable, with such
additions or changes as are necessary to meet the actual
circumstances, with the effect that each Additional Contracting
Party will in effect adopt the provisions of this Contract, as
supplemented and necessarily changed by its contract.
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(b) It is recognized and agreed that the District now has
many System water supply contracts with entities other than the
Initial Contracting Parties, which contracts will remain in
full force and effect, in accordance with their terms and
provisions, after the Contract Date. The District shall
enforce the aforesaid existing water supply contracts during
the entire terms thereof, unless any such contract is replaced
by a contract with an Additional Contracting Party hereunder.
Upon the expiration of each such contract with any party the
District thereafter may sell water to such party only on the
basis that it is a new customer with respect to System water.
(c) It is further recognized and agreed that in the
future the District may sell any water from the System to
parties which are not Additional Contracting Parties, provided
that all such future sales of water from the System to parties
which are not Additional Contracting Parties shall, within the
limits permitted by law, in all respects be subordinate to the
prior rights of the Contracting Parties to water from the
System, and all such sales and contracts relating thereto shall
recognize, and be made subordinate to, such prior rights.
(d) It is recognized and agreed that concurrently with
the execution of this Contract the District and the City of
Garland will execute a separate agreement with respect to raw
industrial water to be taken directly by Garland from Lavon
Reservoir for use as cooling water for its steam electric
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generating plant. Such agreement will substantially restate
and completely replace the rights and obligations of the
parties with respect to raw industrial water from Lavon Reser-
voir under the presently existing additions and modifications
dated November 6, 1964, and August 7, 1973, respectively, to
the original treated water contract dated December 12, 1953,
between the District and Garland. After the execution of said
separate agreement, it will constitute the sole agreement
between said parties with respect to raw industrial water in
Lavon Reservoir, and this Contract will constitute the sole
agreement between said parties with respect to treated water
from the System.
Section 5. QUALITY. The water to be delivered by the
District and received by each Contracting Party shall be
treated water from the System. Each Initial Contracting Party
has satisfied itself that such water will be suitable for its
needs, but the District is obligated to treat such water so as
to meet the standards of all State and Federal agencies having
jurisdiction over water quality. The District and the Con-
tracting Parties shall cooperate, each within its legal powers,
in preventing, to the extent practicable, the pollution and
contamination of the reservoirs and watersheds from which
System water is obtained.
Section 6. POINTS OF DELIVERY. The Point or Points of
Delivery for each Initial Contracting Party shall be the Point
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or Points of Delivery applicable to it under its present
treated water supply contract with the District, or at any
other Point or Points of Delivery mutually agreed upon between
the District and such Initial Contracting Party. Each -Con-
tracting Party shall construct, maintain, and operate, at its
own cost and expense, all facilities and equipment necessary to
receive and take all treated water delivered to it under this
Contract.
Section 7. MEASURING EQUIPMENT.
(a) District shall furnish, install, operate, and main-
tain at its own expense at each Point of Delivery of each
Contracting Party the necessary equipment and devices of
standard type for measuring properly the quantity of treated
water delivered under this agreement. Such meter or meters and
other equipment so installed shall remain the property of
District. Each Contracting Party shall have access to such
metering equipment at all reasonable times, but the reading,
calibration, and adjustment thereof shall be done only by the
employees or agents of the District. For the purpose of this
agreement the original record or reading of the meter or meters
shall be the journal or other record book of District in its
office in which the records of the employees or agents of
District who take the reading are or may be transcribed. Upon
written request of any Contracting Party, District will send it
a copy of such journal or record book, or permit it to have
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access to the same in the office of District during reasonable
business hours.
Not more than once in each calendar month, on a date as
near the end of such calendar month as practical, District
shall calibrate its meters if requested in writing by a Con-
tracting Party to do so, in the presence of a representative of
the Contracting Party, and the parties shall jointly observe
any adjustments which are made to the meters in case any
adjustments shall be necessary, and if the check meters herein-
after provided for have been installed, the same shall also be
calibrated by Contracting Party in the presence of a represen-
tative of District and the parties shall jointly observe any
adjustment in case any adjustment is necessary. If any Con-
tracting Party shall in writing request District to calibrate
its meters and District shall give the Contracting Party notice
of the time when any such calibration is to be made and a
representative of the Contracting Party is not present at the
time set, District may proceed with calibration and adjustment
in the absence of any representative of the Contracting Party.
If a Contracting Party or the District at any time ob-
serves a variation between the delivery meter or meters and the
check meter or meters at that Contracting Party's Point or
Points of Delivery, if any such check meter or meters shall be
installed, such party will promptly notify the other party, and
the District and such Contracting Party shall then cooperate to
procure an immediate calibration test and joint observation of
any adjustment and the same meter or meters shall then be
adjusted to accuracy. The party performing the test shall give
the other party forty-eight (48) hours' notice of the time of
all tests of meters so that the other party may conveniently
have a representative present.
If upon any test, the percentage of inaccuracy of any
metering equipment is found to be in excess of two per cent
(2%), registration thereof shall be corrected for a period
extending back to the time when such inaccuracy began, if such
time is ascertainable, and if such time is not ascertainable,
then for a period extending back one-half (�) of the time
elapsed since the last date of calibration, but in no event
further back than a period of six (6) months. If for any
reason any meters are out of repair so that the amount of water
delivered to a Contracting Party cannot be ascertained or
computed from the reading thereof, the water delivered through
the period such meters are out of service or out of repair
shall be estimated and agreed upon by the District and such
Contracting Party upon the basis of the best data available.
For such purpose, the best data available shall be deemed to be
the registration of any check meter or meters if the same have
been installed and are accurately registering. Otherwise, the
amount of water delivered during such period may be estimated
(i) by correcting the error if the percentage of the error is
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ascertainable by calibration tests or mathematical calculation,
or (ii) estimating the quantity of delivery by deliveries
during the preceding periods under similar conditions when the
meter or meters were registering accurately.
Any Contracting Party may, at its option and its own
expense, install and operate a check meter to check each meter
installed by District, but the measurement of water for the
purpose of this agreement shall be solely by District's meters,
except in the cases hereinabove specifically provided to the
contrary. All such check meters shall be of standard make and
shall be subject at all reasonable times to inspection and
examination by any employee or agent of District, but the
reading, calibration and adjustment thereof shall be made only
by the Contracting Party, except during any period when a check
meter may be used under the provisions hereof for measuring the
amount of water delivered, in which case the reading, calibra-
tion, and adjustment thereof shall be made by District with
like effect as if such check meter or meters had been furnished
or installed by District.
Section 8. UNIT OF MEASUREMENT. The unit of measurement
for treated water delivered under this Contract shall be 1,000
gallons of water, U.S. Standard Liquid Measure.
Section 9. PRICES AND TERMS; PAYMENTS BY CONTRACTING
PARTIES. (a) Annual Requirement and Proportionate Payment.
21
It is acknowledged and agreed that payments to be made under
this Contract and any similar contracts with Additional Con-
tracting Parties will be the primary source available to the
District to provide the Annual Requirement, and that, in
compliance with the District's duty to fix and from time to
time revise the rates of compensation or charges for water sold
and services rendered and made available by the District, the
Annual Requirement will change from time to time, and that each
such Annual Requirement shall be allocated among the Contract-
ing Parties as hereinafter provided, and that the Annual
Requirement for each Annual Payment Period shall at all times
be not less than an amount sufficient to pay or provide for the
payment of:
(A) An "Operation and Maintenance Component" equal
to the amount paid or payable for all Operation
and Maintenance Expenses of the System; and
(B) A "Bond Service Component" equal to:
(1) the principal of, redemption premium, if
any, and interest on, its Bonds, as such
principal, redemption premium, if any,
and interest become due, less interest to
be paid out of Bond proceeds or from other
sources if permitted by any Bond Resolution,
and all amounts required to redeem any Bonds
prior to maturity when and as provided in
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any Bond Resolution; and
(2) the proportionate amount of any special,
reserve, or contingency funds required to be
accumulated and maintained by the provisions of
any Bond Resolution; and
(3) any amount in addition thereto sufficient
to restore any deficiency in any of such
funds required to be accumulated and
maintained by the provisions of any Bond Reso-
lution.
It is agreed that for the treated water supply to be provided
to Contracting Parties under this Contract and similar con-
tracts, each of the Contracting Parties shall pay, at the time
and in the manner hereinafter provided, its proportionate share
of the Annual Requirement, which shall be determined as hereaf-
ter described and shall constitute a Contracting Party's Annual
Payment. Each of the Contracting Parties shall pay its propor-
tionate share of the Annual Requirement for each Annual
Payment Period directly to the District, in approximately equal
monthly installments, or before the 10th day of each month.
(b) Calculation of Proportionate Payments; Rates. For
each Annual Payment Period each Contracting Party's proportion-
ate share of the Annual Requirement shall be a percentage
obtained by dividing the minimum amount specified and calculat-
ed for it for such period, in accordance with sub -section (c)
23
of this Section 9, by the aggregate minimum amounts specified
and calculated for all Contracting Parties for such period in
accordance with said sub -section (c). Thus the base "rate" per
1,000 gallons of treated water which each Contracting Party
must pay for treated water during any Annual Payment Period may
be calculated and expressed by dividing the dollar amount of
such Contracting Party's proportionate share of the Annual
Requirement by the number of 1,000 gallons contained within its
specified minimum amount for such Annual Payment Period. All
such payments for each Annual Payment Period shall be made in
accordance with a schedule of payments for the appropriate
Annual Payment Period which will be supplied to each of the
Contracting Parties by the District.
(c) Minimums. For the purpose of calculating the minimum
amount of each Annual Requirement for which each Initial
Contracting Party is unconditionally liable, without offset or
deduction (also see Section 10(g)), each Initial Contracting
Party, during each Annual Payment Period, shall be deemed to
have taken and used the minimum annual average daily amount of
System treated water (regardless of whether or not such amount
is or was actually taken or used) specified for such Initial
Contracting Party as follows:
for each of the Initial Contracting Parties, respectively,
a minimum amount, expressed in MGD, during each Annual
Payment Period, equal to the greater of:
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(1) .898 MGD for the City of Farmersville
1.159 MGD for the City of Forney
32.476 MGD for the City of Garland
4.433 MGD for the City of McKinney
15.806 MGD for the City of Mesquite
28.688 MGD for the City of Plano
.634 MGD for the City of Princeton
19.760 MGD for the City of Richardson
2.633 MGD for the City of Rockwall
.523 MGD for the City of Royse City
1.186 MGD for the City of Wylie, or
(2) the maximum number of MGD actually taken from
the System by such Initial Contracting Party
during any previous Water Year (as hereinbefore
defined) during the term of this Contract; it
being agreed and understood that any use of
System water in any Water Year by any Initial
Contracting Party in excess of (i) the minimum
amount specified for it in clause (1), above, or
(ii) as determined in accordance with this
clause (2), will establish a new minimum amount
to be effective for the next following Annual
Payment Period and thereafter until any pre-
viously increased minimum amount is further
25
exceeded in any subsequent Water Year, with each
such increase in minimums to be effective for
the next following Annual Payment Period and
thereafter until further increased in accordance
with this clause (2) .
Notwithstanding the foregoing provisions of this sub-
section (c), if any portion of an Initial Contracting Party's
minimum amount is attributable to treated water sold or deliv-
ered to an entity outside of its boundaries, pursuant to a
treated water supply contract, and (i) if such entity should
become an Additional Contracting Party and such treated water
supply contract be terminated, or (ii) if such treated water
supply contract with such Initial Contracting Party otherwise
should be terminated and in lieu thereof such entity should
enter into a treated water supply contract with the District as
permitted in Section 4 hereof, then such Initial Contracting
Party's minimum amount for the next Annual Payment Period and
thereafter shall be reduced by the maximum MGD previously taken
by said entity from such Initial Contracting Party during any
previous Water Year pursuant to such terminated treated water
supply contract with such Initial Contracting Party.
All contracts with Additional Contracting Parties shall
provide for equitable minimums similar to those provided for
above. Such minimums shall be fixed in amounts at least
sufficient, as determined by the District, to assure an initial
26
Annual Payment by each Additional Contracting Party for not
less than the amount of its estimated use of treated water
during the first year of service under such contract.
(d) Excess Water Charges. It is further agreed that, in
addition to the amounts required to be paid by Contracting
Parties pursuant to sub -sections (a), (b), (c), and (e) of this
Section 9, if any Contracting Party during any Water Year uses
System treated water in excess of the minimum amount applicable
to it for the Annual Payment Period which commenced during such
Water Year, then such Contracting Party shall pay an "Excess
Water Charge" equal to that part of the Operation and Mainte-
nance Expenses (electric power, chemicals, and other similar
costs) directly attributable to supplying such excess treated
water to such Contracting Party, all as determined by the
District. Such Excess Water Charge shall be billed by the
District to such Contracting Party as soon as practicable after
the end of such Water Year and shall be paid to the District as
soon as practicable thereafter, and in all events prior to the
beginning of the next Annual Payment Period. Such Excess Water
Charges shall be credited to and be used for paying part of the
Operation and Maintenance Expenses for the then current Annual
Payment Period and reduce to the extent of such credits the
amounts which otherwise would be payable by the Contracting
Parties during such then current Annual Payment Period.
(e) Redetermination of Annual Requirement. Each Con-
tracting Party's share of the Annual Requirement shall be
redetermined, after consultation with each of the Contracting
Parties, at any time during any Annual Payment Period, to the
extent deemed necessary or advisable by the District, if:
(i) The District commences supplying System treated
water to an Additional Contracting Party or Parties;
(ii) Unusual, extraordinary, or unexpected expendi-
tures for Operation and Maintenance Expenses are
required which are not provided for in the Dis-
trict's Annual Budget for the System or in any
Bond Resolution;
(iii) Operation.and Maintenance Expenses are substan-
tially less than estimated;
(iv) The District issues Bonds which require an in-
crease in the Bond Service Component of the
Annual Payment; or
(v) The District receives either significantly more
or significantly less revenues or other amounts
than those anticipated.
(f) Other Revenues. During each Annual Payment Period
the revenues derived from sales of System water, other than
sales of treated water to Contracting Parties, shall be credit-
ed to and be used for paying part of the Annual Requirement in
the manner determined by the District, with the result that
28
such credits shall reduce, to the extent of such credits, the
amounts which otherwise would be payable by the Contracting
Parties pursuant to the methods prescribed in sub -sections (a)
(b), (c), and (e), above. The District shall estimate all such
credits which it expects to make during each Annual Payment
Period in calculating each Annual Payment.
(g) Annual Budget. On or before the first day of the
fourth calendar month prior to the beginning of each Annual
Payment Period hereafter the District shall furnish each
Contracting Party with a tentative or preliminary estimated
schedule of the monthly payments to be made by such party to
the District for the ensuing Annual Payment Period. On or
before the first day of the second calendar month prior to the
beginning of each Annual Payment Period hereafter the District
shall furnish each Contracting Party with an updated estimated
schedule of the monthly payments to be made by such Party to
the District for the next ensuing Annual Payment Period. Prior
to the first day of each Annual Payment Period hereafter the
District shall furnish each Contracting Party with a final
estimated schedule of the monthly payments to be made by such
Party to the District for the next ensuing Annual Payment
Period, together with the supporting budgetary data showing the
basis for arriving at such schedule. Any surplus budgeted
funds remaining on hand at the end of any Annual Payment Period
shall be used during the following Annual Payment Period and
W
reduce in the manner determined by the District, to the extent
of any such surplus funds, the amounts which otherwise would be
payable by the Contracting Parties under sub -sections (a), (b),
(c), and (e), above. Each Contracting Party hereby agrees that
it will make such payments to the District on or before the
10th day of each month of such Annual Payment Period. If any
Contracting Party at any time disputes the amount to be paid by
it to the District, such complaining party shall nevertheless
promptly make such payment or payments, but if it is subse-
quently determined by agreement or court decision that such
disputed payments made by such complaining party should have
been less, or more, the District shall promptly revise and
reallocate the charges among all Contracting Parties in such
manner that such complaining party will recover its overpayment
or the District will recover the amount due it.
(h) Delinquencies. All amounts due and owing to the
District by each Contracting Party or due and owing to any
Contracting Party by the District shall, if not paid when due,
bear interest at the rate of ten (10) percent per annum from
the date when due until paid. The District shall, to the
extent permitted by law, suspend delivery of water from the
System to any Contracting Party which remains delinquent in any
payments due hereunder for a period of sixty days, and shall
not resume delivery of water while such Contracting Party is so
delinquent. It is further provided and agreed that if any
30
Contracting Party should remain delinquent in any payments due
hereunder for a period of one hundred twenty days, and if such
delinquency continues during any period thereafter, such
Contracting Party's minimum amount of MGD as described in
sub -section (c), above, shall be deemed to have been zero MGD
during all periods of such delinquency, for the purpose of
calculating and redetermining the percentage of each Annual
Payment to be paid by the non -delinquent Contracting Parties.
However, the District shall promptly pursue all legal remedies
against any such delinquent Contracting Party to enforce and
protect the rights of the District, the other Contracting
Parties, and the owners of the Bonds, and such delinquent
Contracting Party shall not be relieved of the liability to the
District for the payment of all amounts which would have been
due hereunder, in the absence of the next preceding sentence.
It is understood that the foregoing provisions are for the
benefit of the owners of the Bonds so as to insure that all of
each Annual Requirement will be paid by the non -delinquent
Contracting Parties during each Annual Payment Period regard-
less of the delinquency of a Contracting Party. If any amount
due and owing by any Contracting Party to the District is
placed with an attorney for collection, such Contracting Party
shall pay to the District all attorneys fees, in addition to
all other payments provided for herein, including interest.
31
(i) Updated Schedules of Payment. If, during any Annual
Payment Period, any Contracting Party's Annual Payment is
redetermined as provided in this Section, the District will
promptly furnish such Contracting Party with an updated sched-
ule of monthly payments reflecting such redetermination.
Section 10. SPECIAL CONDITIONS AND PROVISIONS. (a)
Operation and Maintenance of System. The District will contin-
uously operate and maintain the System in an efficient manner
and in accordance with good business and engineering practices,
and at reasonable cost and expense. By executing this Contract
the Initial Contracting Parties waive any and all claims, as
against each other, to any preferential right or entitlement to
the capacity or use of specific water sources of the District.
The District recognizes its right and duty to operate the
various facilities of the System in the most prudent and
economical manner for the benefit of all the Contracting
Parties. The District shall exercise loyalty, good faith, and
fair dealing relating to all System activities undertaken by
the District as between the District and the Contracting
Parties.
(b) Permits, Financing, and Applicable Laws. It is
understood that any obligations on the part of the District to
acquire, construct, and complete the Projects and other System
facilities and to provide treated water from the Projects and
other System facilities to the Contracting Parties shall be (i)
conditioned upon the District's ability to obtain all necessary
32
permits, material, labor, and equipment, and upon the ability
of the District to finance the cost of the Projects and other
System facilities through the actual sale of the District's
Bonds and (ii) subject to all present and future valid laws,
orders, rules, and regulations of the United States of America,
the State of Texas, and any regulatory body having jurisdic-
tion.
(c) Title to Water; Indemnification. Title to all
treated water supplied to each Contracting Party shall be in
the District up to each Point of Delivery, at which point title
shall pass to the receiving Contracting Party. The District
and each of the Contracting Parties shall save and hold each
other party harmless from all claims, demands, and causes of
action which may be asserted by anyone on account of the
transportation and delivery of said water while title remains
in such party. Notwithstanding any other provision of this
Contract, it is specifically provided that water obtained or
resulting from the wastewater treatment operations of any
Contracting Party shall be under the sole and exclusive domin-
ion, control, and ownership of such Contracting Party and the
District shall have no right, title, or interest in or claim
against such water of any nature whatsoever.
(d) Payments Solely From Revenues. The District shall
never have the right to demand payment by any Initial Contract-
ing Party of any obligations assumed by it or imposed on it
under and by virtue of this Contract from funds raised or to be
raised by taxes, and the obligations under this Contract shall
33
never be construed to be a debt of such kind as to require any
of the Initial Contracting Parties to levy and collect a tax to
discharge such obligation.
(e) Operating Expenses of Initial Contracting Parties.
Each of the Initial Contracting Parties represents and cove-
nants that all payments to be made by it under this Contract
shall constitute reasonable and necessary "operating expenses"
of its waterworks system, in accordance with Vernon's Ann.
Tex. Civ. St. Articles 1113 and 4413(32c). It is further
recognized that the waterworks system of each Initial Contract-
ing Party is presently combined with its sewer system in
accordance with law for operating and financing purposes. Each
of the Initial Contracting Parties, respectively, represents
and has determined that the treated water supply to be obtained
from the System, including the Projects and other System
facilities, is absolutely necessary and essential to the
present and future operation of its waterworks system and is
the only available and adequate source of supply of treated
water therefor. Accordingly, the payments required by this
Contract to be made by each Initial Contracting Party shall
constitute reasonable and necessary operating expenses of its
waterworks system and shall be made as provided by law, includ-
ing the aforesaid Articles 1113 and 4413(32c). In accordance
with said Article 1113, such payments shall have priority over
the payment of principal of and interest on all bonds and other
34
similar obligations heretofore or hereafter issued by any
Initial Contracting Party.
(f) Initial Contracting Parties' Rates For Water and
Sewer System Services. Each of the Initial Contracting Parties
agrees throughout the term of this Contract to continuously
operate and maintain its combined waterworks and sewer system,
and to fix and collect such rates and charges for water and
sewer services to be supplied by its combined waterworks and
sewer system as aforesaid as will produce revenues in an amount
equal to at least (i) all of its payments under this Contract
and (ii) all other amounts required to be paid from said
revenues by law and the provisions of the ordinances or resolu-
tions authorizing its revenue bonds or other obligations now or
hereafter outstanding.
(g) Initial Contracting Parties' Unconditional Obliga-
tions. Recognizing the fact that the Initial Contracting
Parties urgently require the facilities and services of the
System, and that such facilities and services are essential and
necessary for actual use and for standby purposes, and recog-
nizing the fact that the District will use payments received
from the Initial Contracting Parties to pay and secure the
Bonds, it is hereby agreed that each of the Initial Contracting
Parties shall be unconditionally obligated to pay, without
35
offset or deduction, its proportionate share of each Annual
Requirement, as provided and determined by this.Contract
(including the obligations for paying for "minimums" as
described in Section 9 (c) hereof), regardless of whether or
not the District actually acquires, constructs, or completes
the Projects or other System facilities or is actually deliver-
ing water from the System to any Contracting Party, or whether
or not any Contracting Party actually receives or uses water
from the System whether due to Force Majeure or otherwise, and
regardless of any other provisions of this or any other con-
tract or agreement between any of the parties hereto. This
covenant by the Initial Contracting Parties shall be for the
benefit of, and enforceable by, the owners of the Bonds as well
as the District.
Section 11. FORCE MAJEURE. If by reason of force majeure
any party hereto shall be rendered unable wholly or in part to
carry out its obligations under this Contract, other than the
obligation of each Contracting Party to make the payments
required under Section 9 of this Contract, then if such party
shall give notice and full particulars of such force majeure in
writing to the other parties within a reasonable time after
occurrence of the event or cause relied on, the obligation of
the party giving such notice, so far as it is affected by such
force majeure, shall be suspended during the continuance of the
inability then claimed, but for no longer period, and any such
36
party shall endeavor to remove or overcome such inability with
all reasonable dispatch. The term "Force Majeure" as employed
herein shall mean acts of God, strikes, lockouts, or other
industrial disturbances, acts of public enemy, orders of any
kind of the Government of the United States or the State of
Texas, or any Civil or military authority, insurrection, riots,
epidemics, landslides, lightning, earthquake, fires, hurri-
canes, storms, floods, washouts, droughts, arrests, restraint
of government and people, civil disturbances, explosions,
breakage or accidents to machinery, pipelines or canals,
partial or entire failure of water supply, or on account of any
other causes not reasonably within the control of the party
claiming such inability.
Section 12. INSURANCE. The District agrees to carry and
arrange for fire, casualty, public liability, and/or other
insurance, including self insurance, on the System for purposes
and in amounts which, as determined by the District, ordinarily
would be carried by a privately owned utility company owning
and operating such facilities, except that the District shall
not be required to provide liability insurance except to insure
itself against risk of loss due to claims for which it can, in
the opinion of the District's legal counsel, be liable under
the Texas Tort Claims Act or any similar law or judicial
decision. Such insurance will provide, to the extent feasible
and practicable, for the restoration of damaged or destroyed
37
properties and equipment, to minimize the interruption of the
services of such facilities. All premiums for such insurance
shall constitute an Operation and Maintenance Expense of the
System.
Section 13. TERM AND EFFECT OF CONTRACT. (a) This
Contract shall, upon execution by the District and all of the
Initial Contracting Parties, be effective as of the Contract
Date, and this Contract shall continue in force and effect
until all Bonds and all interest thereon shall have been paid
or provided for, and thereafter shall continue in force and
effect during the entire useful life of the System. The
requirement for making the Annual Payments as prescribed in
Section 9 of this Contract shall commence as of October 1,
1988. Until October 1, 1988, payments for treated water shall
continue to be made to the District by the Initial Contracting
Parties in accordance with the eleven separate existing treated
water supply contracts, and amendments thereto, between the
District and the Initial Contracting Parties.
(b) It is specifically agreed and understood that this
Contract, as of the Contract Date, will supersede all of the
contracts, agreements, and arrangements between each of the
parties hereto with respect to the System and treated water
from the System and the Bonds, and that this Contract, as of
the Contract Date, will completely amend and supersede all such
contracts, agreements, and arrangements with respect to the
38
System and treated water from the System and the Bonds, and
will constitute the sole agreement between the parties hereto
or any of them with respect to the System and treated water
from the System and the Bonds; and all such previous contracts,
agreements, and arrangements shall be void and shall be of no
force or effect, except for payments due and liabilities
accrued thereunder prior to October 1, 1988, and except as
provided in subsections (a) and (c), of this Section 13, and
except that the "AGREEMENT BETWEEN THE NORTH TEXAS MUNICIPAL
WATER DISTRICT AND THE CITY OF McKINNEY FOR AN ADDITIONAL POINT
OF DELIVERY", authorized by said City's resolution adopted
September 2, 1986, and the District's resolution adopted
December 18, 1986, shall be and remain in full force and effect
until its expiration, and said City shall make payments to the
District thereunder in addition to those required under this
Contract, with such additional payments to be treated and
applied as "other revenues" in accordance with Section 9(b) of
this Contract.
(c) It is recognized by the parties to this Contract that
the eleven previous treated water supply contracts, and amend-
ments thereto, between the District and the Initial Contracting
Parties, respectively, which are being amended hereby, together
with the proceedings relating thereto, previously have been
submitted to an Attorney General of Texas, along with bonds of
the District heretofore issued, as provided in the District
39
Act, and that an Attorney General, in his certificates and
opinions relating to such bonds, found that such contracts were
made in accordance with the Constitution and laws of the State
of Texas, and that they are valid and enforceable in accordance
with their terms and provisions. Further, an Attorney General
approved each of such contracts, with the effect that pursuant
to the provisions of the District Act such contracts "shall be
valid and binding and shall be incontestable for any cause".
In order to protect the rights of the owners of the Bonds and
the parties to this Contract, it is specifically agreed and
understood by the parties to this Contract that, any provisions
of this Contract to the contrary notwithstanding, if for any
reason whatsoever this Contract, or any part of this Contract
significantly affecting the rights of the owners of the Bonds,
should be held to be invalid or unconstitutional, or in contra-
vention of any law or any constitutional provisions, then the
foregoing contracts shall be construed and deemed to be and to
have been in full force and effect at all times to the extent
required to protect the rights of the owners of the Bonds and
the parties to such contracts. It is further agreed and
understood by the parties to this Contract that this Contract
is amendatory in nature and is not intended to, and does not,
abrogate the rights of the owners of any Bonds, and is not
intended to, and does not, affect adversely in any way the
security therefor, but is intended to and does confirm the
40
security therefor, substantially restate, clarify, carry
forward, update, improve, and extend the provisions of the
previous contracts.
Section 14. MODIFICATION. No change or modification of
this Contract shall be made which will affect adversely the
prompt payment when due of all moneys required to be paid by
any Contracting Party under the terms of this Contract or any
similar contract, and no such change shall be effective which
would cause a violation of any provisions of any Bond Resolu-
tion. No change or modification of this Contract shall be'made
without the written consent of all parties hereto.
Section 15. REGULATORY BODIES AND LAWS. This Contract is
subject to all applicable Federal and State laws and any
applicable permits, ordinances, rules, orders, and regulations
of any local, state, or federal governmental authority having
or asserting jurisdiction, but nothing contained herein shall
be construed as a waiver of any right to question or contest
any such law, ordinance, order, rule, or regulation in any
forum having jurisdiction.
Section 16. NOTICES. Unless otherwise provided herein,
any notice, communication, request, reply, or advice (herein
severally and collectively, for convenience, called "Notice")
herein provided or permitted to be given, made, or accepted by
any party to any other party must be in writing and may be
41
given or be served by depositing the same in the United States
mail postpaid and registered or certified and addressed to the
party to be notified, with return receipt requested, or by
delivering the same to an officer of such party, or by prepaid
telegram when appropriate, addressed to the party to be noti-
fied. Notice deposited in the mail in the manner hereinabove
described shall be conclusively deemed to be effective, unless
otherwise stated herein, from and after the expiration of three
days after it is so deposited. Notice given in any other
manner shall be effective only if and when received by the
party to be notified. For the purposes of notice, the ad-
dresses of the parties shall, until changed as hereinafter
provided, be as follows:
If to the District, to:
North Texas Municipal Water District
P. O. Drawer C
Wylie, Texas 75098
If to the Initial Contracting Parties, as follows:
City of Farmersville
303 S. Main
Farmersville, Texas 75031
City of Forney
101 E. Main Street
Forney, Texas 75126
City of Garland
200 N. Fifth Street
P. O. Box 469002
Garland, Texas 75040
City of McKinney
P. O. Box 517
McKinney, Texas 75069
42
City of Mesquite
711 N. Galloway
Mesquite, Texas 75149
City of Plano
P. O. Box 860358
Plano, Texas 75086-0358
City of Princeton
306 N. Front Street
Princeton, Texas 75077
City of Richardson
411 W. Arapaho Road
Richardson, Texas 75080
City of Rockwall
205 W. Rusk
Rockwall, Texas 75087
City of Royse,City
P. O. Drawer A
Royse City, Texas 75089
City of Wylie
P. O. Box 428
Wylie, Texas 75098
The parties hereto shall have the right from time to time and
at any time to change their respective addresses and each shall
have the right to specify as its address any other address by
at least fifteen (15) days' written notice to the other parties
hereto.
Section 17. SEVERABILITY. The parties hereto specifi-
cally agree that in case any one or more of the sections, sub-
sections, provisions, clauses, or words of this Contract or the
application of such sections, subsections, provisions, clauses,
or words to any situation or circumstance should be, or should
be held to be, for any reason, invalid or unconstitutional,
43
under the laws or constitutions of the State of Texas or the
United States of America, or in contravention of any such laws
or constitutions, such invalidity, unconstitutionality, or
contravention shall not affect any other sections, subsections,
provisions, clauses, or words of this Contract or the applica-
tion of such sections, subsections, provisions, clauses, or
words to any other situation or circumstance, and it is in-
tended that this Contract shall be severable and shall be
construed and applied as if any such invalid or unconstitu-
tional section, subsection, provision, clause, or word had not
been included herein, and the rights and obligations of the
parties hereto shall be construed and remain in force accord-
ingly.
Section 18. REMEDIES UPON DEFAULT. It is not intended
hereby to specify (and this Contract shall not be considered as
specifying) an exclusive remedy for any default, but all such
other remedies (other than termination) existing at law or in
equity may be availed of by any party hereto and shall be
cumulative. Recognizing however, that the District's under-
taking to provide and maintain a supply of water hereunder is
an obligation, failure in the performance of which cannot be
adequately compensated in money damages alone, the District
agrees, in the event of any default on its part, that each
Contracting Party shall have available to it the equitable
remedy of mandamus and specific performance in addition to any
44
r
other legal or equitable remedies (other than termination)
which may also be available. Recognizing that failure in the
performance of any Initial Contracting Party's obligations
hereunder could not be adequately compensated in money damages
alone, each Initial Contracting Party agrees in the event of
any default on its part that the District shall have available
to it the equitable remedy of mandamus and specific performance
in addition to any other legal or equitable remedies (other
than termination) which may also be available to the District.
No waiver or waivers of any breach or default (or any breaches
or defaults) by any party hereto or of performance by any other
party of any duty or obligation hereunder shall be deemed a
waiver thereof in the future, nor shall any such waiver or
waivers be deemed or construed to be waiver of subsequent
breaches or defaults of any kind, character, or description,
under any circumstances.
Section 19. VENUE. All amounts due under this Contract,
including, but not limited to, payments due under this Contract
or damages for the breach of this Contract, shall be paid and
be due in Collin County, Texas, which is the County in which
the principal administrative offices of the District are
located. It is specifically agreed among the parties to this
Contract that Collin County, Texas, is a principal place of
performance of this Contract; and in the event that any legal
45
proceeding is brought to enforce this Contract or any provision
hereof, the same shall be brought in Collin County, Texas.
IN WITNESS WHEREOF, the parties hereto acting under au-
thority of their respective governing bodies have caused this
Contract to be duly executed in several counterparts, each of
which shall constitute an original, all as of the day and year
first above written, which is the date of this Contract.
NORTH S MUNICIPAL WAT DISTRICT
BY_.��
4164&ee
resident Board of Directors
ATTEST:
.tom
Secretary, Board of Directors
APPROVED AS TO FORM AND LEGALITY:
Attorneys for the District
(DISTRICT SEAL)
CITY OF FARMERSVILLE, TEXAS
BY
Mayor
ATTEST:
AZA4�4)
City Secret 2ft
46
(CITY SEAL)
ATTEST:
-,Jkd-& 0,��
ty 8ecretary
(CITY SEAL)
ATTEST:
City Secretary
(CITY SEAL)
AND LEGALITY:
CITY OF FORNEY, TEXAS
C� J ,,<?, -t�
Mayor
APPROVED AS TO FORM AND LE ITY:
City Attorney
m:
G LAND, TEXAS k k)ll &
Mayor
47
AS TO; FOWTWQ/ LEGALITY:
ty Atto
ATTEST:
C414'y Secretary
CITY OF McKINNEY, TEXAS
BY
Mayor
(CITY SEAL)
CI
ATTEST:
ity Secret ry
(CITY SEAL)
BY
APPROVED AS TO FORM AND LEGALITY:
ty Attorney
CITY OF PLANO, TEXAS
BY —J 9L�
Mayor
48
c
ATTE T:
Ci y Secre dry
(CITY SEAL)
APPROVED AS TO FORM AND LEGALITY:
Nify Attorney
CITY OF PRINCETON, TEXAS
BY
ayor
ATTEST:
AZ.IPG
If '141
'City Secretary
APPROVED AS TO FORM AND LEGALITY:
City Att rney
z
(CITY SEAL)
CITY OF RICHARDSON, TEXAS
BY
Mayor
ATTEST:
gauAx'l
City Secretary
(CITY SEAL)
APPROVED AS TO FORM AND LEGALITY
— (�� ;;� "Zz?x
City Attorn
ATTEST:
a-, �-rl dd4p
C' y Secr tary
(CITY SEAL)
ATTEST:
City Secretary
(CITY SEAL)
CITY OF ROCKWALL, TEXAS
BY e
Mayor
APPROVED TO FORM AND LEGALITY
City Attorney
CITY OF ROYSE CITY EXAS
Mayor
APPROV S TO FORM AND LEGALITY:
City Attorney
CITY , TEXAS
r
50
ATTEST:
't Se r a y
APPROVED AS TO FORM AND LEGALITY
(CITY EE L) S
EAL
l E, TEP
�� /, 4e5�11�4
111
City Attorney
51
.�;4 �v Ftl�
RESOLUTION NO. 524-6-84(R)
CERTIFICATE FOR
RESOLUTION AU'T'HORIZING AND DIRECTING TITS FA=ION OF 711E "UPPER EAST
FORK WASM�V= INTERCEPTOR SYSTEM CONrRAC-r" WIT11 NORTH TEXAS tIUNICIPAL
WATER DISTRICT AND OTHERS, AMID PROVIDING FOR THE EFFECT OF SAID
RESOLUTION AND CONTRACT
THE S= OF TEXAS
COUNTY OF COLLIN
CITY OF ALIT
We, the undersigned officers of the City of Allen, Texas, hereby certify
as follows:
1. The City Council of the City of Allen convened in
REGULAR MEETING ON THE 21ST DAY OF JUNE, 1984, at the City Hall, and
the roll was called of the duly constituted officers and members of said City
Council, to -wit:
Marty Hendrix, City Secretary Donald P. Rodenbaugh, Mayor
Joe Farmer J. M. McClure
G. Ward Paxton Dennis Offutt
Rex ikmack Jim 4"Tolfe
and all of said persons were present, except the following absentees:
NOTE, thus constituting a quorum. 4uliereupon, among other business, the
following was transacted at said Meeting: a written
RESOLUTION AUTHORIZING AND DIRECTING THE E ]TION OF THE "UPPER
FAST FORK 19MEWATER INTERCEPTOR SYSMI CO MACT" WITH NORTH TEXAS
MUNICIPAL «ITER DISTRICT AND (ME RS, AND PROVIDING FOR THE EFFECT OF
SAID RESOLUTION AMID CON'T'RACT
was duly introduced for the consideration of said City Council and duly read.
It was then duly moved and seconded that said Resolution be adopted and
passed; and, after due discussion, said motion, carrying with it the adoption
and passage of said Resolution, prevailed and carried by the following record
vote:
AYES: Rodenbaugh, McClure, Wolfe, Farmer, and Womack.
NAYS: Paxton and Offutt.
2. That a true, full, and correct copy of the aforesaid Resolution
adopted and passed at the Meeting described in the above and foregoing para-
graph is attached to and follows this Certificate; that said Resolution has
been duly recorded in said City Council's minutes of said Meeting; that the
above and foregoing paragraph is a true, full, and correct excerpt from said
City Council's minutes of said Meeting pertaining to the adoption and passage
of said Resolution; that the persons named in the above and foregoing para-
graph are the duly chosen, qualified, and acting offic�xs and members of said
City Council as indicated therein; and that each of the officers and members
of said City Council was duly and sufficiently notified officially and per-
sonally, in advance, of the time, place, and purpose of the aforesaid Meeting,
and that said Resolution would be introduced and considered for adoption and
passage at said Meeting; and that said Meeting was open to the public, and
public notice of the time, place, and purpose of said Meeting was given, all
as required by Vernon's Ann. Civ. St. Article 6252-17.
3. That the Mayor of said City of Allen has approved, and hereby ap-
proves, the aforesaid Resolution; that the Mayor and the City Secretary of
said City have duly signed and authenticated said Resolution; and that the
Mayor and the City Secretary of said City hereby declare that their signing of
this Certificate shall constitute the signing and authentication of the
attached and following copy of said Resolution for all purposes.
IGlirS 21st day of June, 1984.
City retary Mayor
(CITY SEAL)
RESOLUTION NO. 524-6-84(R)
RESOLUTION AUTHORIZING AND DIRECTING THE EXECUTION OF
THE "UPPER EAST FORK WASTEWATER INTERCEPTOR SYSTEM
CONTRACT" WITH NORTH TEXAS MUNICIPAL WATER DISTRICT
AND OTHERS, AND PROVIDING FOR THE EFFECT OF SAID
RESOLUTION AND CONTRACT
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ALLEN:
SECTION I
That, for and on behalf of the City of Allen, the Mayor of
the City of Allen is hereby authorized and directed to sign,
deliver, and otherwise execute, and the City Secretary of the
City of Allen is hereby authorized and directed to sign,
attest, and seal, the "Upper East Fork Wastewater Interceptor
System Contract" (the "Contract") with North Texas Municipal
Water District and others in substantially the form and sub-
stance attached to this Resolution and made a part hereof for
all purposes.
SECTION 2
That, upon its execution by the parties thereto, the
Contract shall be binding upon the City of Allen in accordance
with its terms and provisions.
SECTION 3
That this Resolution shall take effect and be in full
force and effect from and after the date of its adoption and
passage, and it is so resolved; and all ordinances and resolu-
tions of the City of Allen in conflict herewith are hereby
amended or repealed to the extent of such conflict, and all
such ordinances and resolutions, and any contracts or agree-
ments or parts authorized thereby, shall be of no further force
or effect upon execution of the Contract to the extent of any
such conflict.
.upm F, -Am, F �)Ni i!t,fi'I'r,4J�i'I'rii1 i i� i i;r ► r;r r� ►i, �; i i,r� ►iri nt��.�i,
THE STATE OF TEXAS
NORTH TEXAS MUNICIPAL WATER DISTRICT
THIS UPPER EAST FORK WASTEWATER INTERCEPTOR SYSTEM CON-
TRACT (the "Contract") made and entered into as of the day
of , 1984 (the "Contract Date"), by and among NORTH
TEXAS MUNICIPAL WATER DISTRICT (the "District"), an agency and
political subdivision of the State of Texas, being a conserva-
tion and reclamation district created and functioning under
Article 16, Section 59, of the Texas Constitution, pursuant to
Chapter 62, Acts of the 52nd Legislature of the State of Texas,
Regular Session, 1951, as amended (the "District Act"), and the
following:
CITY OF fAI;ILEN, IN COLLIN COUNTY, TEXAS,
CITY OF McKI_NNEY, IN COLLIN COUNTY, TEXAS,
CITY OF PLANO, IN COLLIN COUNTY, TEXAS, and
CITY OF RICHARDSON, IN DALLAS AND COLLIN COUNTIES, TEXAS
(collectively the "Initial Contracting Parties").
W I T N E S S E T H:
WHEREAS, each of the Initial Contracting Parties is a duly
created city and political subdivision of the State of Texas
operating under the Constitution and laws of the State of
Texas; and
WHEREAS, the District and the Initial Contracting Parties
are authorized to enter into this Contract pursuant to the
District Act, Chapter 30, Texas Water Code, Vernon's Ann. Tex.
Civ. St. Article 4413(32c) (the "Interlocal Cooperation Act"),
and other applicable laws; and
WHEREAS, the District presently owns and operates a
regional Wastewater treatment system serving the Initial Con-
tracting Parties in the area of the upper East Fork of the
Trinity River in Dallas and Collin Counties, Texas, (the
"Treatment System"); and
WHEREAS, the District presently serves the Initial Con-
tracting Parties under various "Trinity East Fork Regional
1
Wastewater System Contracts" (the "Treatment Contracts") now in
HI I HO , 11111 1 lii, I l I i loo 1111.111 1I�'HI ►.iii 111d ho, 1111114, will
by the Treatment Contracts the Treatment System is prohibited
from including, any facilities required to transport Wastewater
to the Point of Entry of any Initial Contracting Party into the
District's Treatment System; and
WHEREAS, the District proposes to acquire and construct
facilities which will not be part of the Treatment System, but
which will consist of facilities required to transport Waste-
water of the Initial Contracting Parties to their respective
Points of Entry into the Treatment System; and
WHEREAS such Wastewater transportation facilities (herein-
after called the "Interceptor System") are described in a
report of Shimek, Jacobs & Finklea, Consulting Engineers,
Dallas, Texas, dated -November, 1983; and
WHEREAS, such report, including all amendments and supple-
ments thereto made prior to the execution of acquisition and
construction contracts for the Interceptor System and as
changed by change orders entered after acquisition and con-
struction contracts for the Interceptor System have been
executed, is hereinafter called the "Engineering Report"; and
WHEREAS, it is expected by the parties hereto that as soon
as practicable after the execution of this Contract the Dis-
trict will issue Bonds payable from and secured by Annual
Payments made under this Contract by the Initial Contracting
Parties to provide the Interceptor System.
NOW, THEREFORE, in consideration of the mutual covenants
and agreements herein contained, the District agrees to use its
best efforts to issue its Bonds and to provide the Wastewater
transportation services of the Interceptor System to the
Initial Contracting Parties under this Contract, and to use its
best efforts to acquire and construct the Interceptor System,
�I upon and subject to the terms and conditions hereinafter set
I
forth, to -wit:
2
I
Section 1. DEFINITION OF TERMS. The following terms and
expressions as used in this Contract, unless the context
clearly shows otherwise, shall have the following meanings:
(a) "Additional Contracting Party" means any party not
defined as one of the Initial Contracting Parties with which
the District makes a contract similar to this Contract for
providing services of the Interceptor System, provided that
after execution of any such contract such party shall become
one of the Contracting Parties for all purposes of this Con-
tract, unless otherwise specifically provided herein.
(b) "Adjusted Annual Payment" means the Annual Payment,
as adjusted during or after each Annual Payment Period, as
provided by this Contract.
(c) "Annual Payment" means the amount of money to be paid
to the District by each of the Contracting Parties during each
Annual Payment Period as its proportionate share of the Annual
Requirement.
(d) "Annual Payment Period" means the District's Fiscal
Year, which currently begins on October 1 of each calendar year
and ends on the last day of September of the next calendar
year, and the first Annual Payment Period under this Contract
shall be the period of October 1, 1984, through September 30,
1985.
(e) "Annual Requirement" means the total amount of money
required for the District to pay all Operation and Maintenance
Expenses of the Interceptor System, to pay the debt service on
its Bonds, to pay or restore any amounts required to be de-
posited in any special, contingency, or reserve funds required
to be established and/or maintained by the provisions of the
Bond Resolutions, all as further described in this Contract.
(f) "Bond Resolution" means any resolution of the Dis-
trict which authorizes any Bonds.
(g) "Bonds" means bonds hereafter issued by the District,
whether in one or more series or issues, and the interest
3
thereon, to acquire and construct the TnterceptoT System,
wld/ul- puliaequolil_ I y Lu 1111i,i uve aiid/ur exLend Llie 1 iiLei ueptur
System, and any bonds issued to refund any Bonds or to refund
any such refunding bonds.
(h) "Contracting Parties" means the "Initial Contracting
Parties", as defined in the first paragraph of this Contract,
together with any other party or parties which hereafter
becomes one of the Contracting Parties by becoming an Addi-
tional Contracting Party.
(i) "Contracting Party" means any one of the Contracting
Parties.
(j) "Engineering Report" means the "Engineering Report"
as defined in the preamble to this Contract.
(k) "Interceptor System" means collectively the Waste-
water transportation facilities described in the Engineering
Report, and all improvements and additions to and extensions, -
enlargements, and replacements of such facilities which are
acquired and constructed by the District in order to receive
and transport Wastewater of the Contracting Parties to their
respective Points of Entry into the Treatment System. However,
and notwithstanding the foregoing, said; term includes only
those facilities which are acquired or constructed with pro-
ceeds from the sale of Bonds issued, or payments made, pursuant
to this Contract. Said term does not include any part of the
Treatment System or any facilities acquired or constructed by
the District with the proceeds from the issuance of "Special
Facilities Bonds", which are hereby defined as being revenue
obligations of the District which are not secured by or payable
from Annual Payments made under this Contract and similar
contracts with Additional Contracting Parties, and which are
payable solely from other sources.
(1) "Operation and Maintenance Expenses" means all costs
and expenses of operation and maintenance of the Interceptor
System, including (for greater certainty but without limiting
the generality of the foregoing) repairs and replacements for
4
H
which no special fund is created in the Bond Resolutions,
operating personnel, the cost of utilities, the costs of
supervision, engineering, accounting, auditing, 1_egal services,
supplies, services, administration of the interceptor System,
including the District's general overhead expenses attributable
to the Interceptor System, insurance premiums, equipment
necessary for proper operation and maintenance of the Inter-
ceptor System, and payments made by the District in satisfac-
tion of judgments resulting from claims not covered by the
District's insurance arising in connection with the operation
and maintenance of the Interceptor System. The term also
includes the charges of the bank or banks and other entities
acting as paying agents and/or registrars for any Bonds. The
term does not include depreciation.
(m) "Treatment Contracts" means the "Treatment Contracts"
as defined in the preamble to this Contract, and includes all
contracts, and all amendments thereto or replacements thereof,
heretofore or hereafter entered into between or among the
Contracting Parties and the District with respect to the
Treatment System, with such existing contracts being described
as follows:
Trinity East Fork Regional Wastewater System Contract,
dated as of October 1, 1975 among the Cities of
Mesquite and Plano and the District.
City of Richardson -Trinity East Fork Regional Wastewater
System Contract dated as of January 9, 1978, between the
City of Richardson and the District.
City of Allen -Trinity East Fork Regional Wastewater
System Contract, dated as of August 24, 1978, between
the City of Allen and the District, and
City of McKinney -Trinity East Fork Regional Wastewater
System Contract, dated as of August 29, 1979, between
the City of McKinney and the District.
(n) "Treatment System" means the District's "Treatment
�- System" as defined in the preamble to this Contract, and
includes all facilities acquired, constructed, or operated by
the District pursuant to the Treatment Contracts.
G0
1
(U) "WApI_PW0tP1 " 111Pallq SIPWaye, 111dU1aLr1a1 Waste, Municl-
pal Waste, Recreational Waste, and Agricultural Waste, together
with Properly Shredded Garbage and such Infiltration water that
I
, may be present, all as defined in the Texas Water Code.
Section 2. CONSULTING ENGINEERS; CONSTRUCTION OF INTER-
(WTOR SYSTFM- ThP Pj;j1-i*J qn(l l ll� lil,j I'gl-1-lp§ qf. rj"
that Shimek, Jacobs & Finklea shall be the Consulting Engineers
for Interceptor System, provided that the Consulting Engineers
I may be changed at the option of the District. The District
0
s agrees to use its best efforts to acquire and construct the
p Interceptor System, and agrees that the Interceptor System will
be acquired and constructed in general accordance with the
I
Engineering Report. It is anticipated that such acquisition
and construction will be financed by the District through the
I issuance of one or more series or issues of its Bonds payable
from and secured by Annual Payments made under this Contract,
I and the District agrees to use its best efforts to issue its
Bonds for such purpose. The proceeds from the sale and de-
livery of such Bonds also will be used for the payment of the
District's expenses and costs in connection with the Inter-
ceptor System and the Bonds, including, without limitation, all
financing, legal, printing, and other expenses and costs
related to the issuance of such Bonds and the Interceptor
System.
Section 3. QUANTITY AND POINTS OF ENTRY. (a) In con-
sideration of the payments to be made by each Contracting Party
under this Contract, during each Annual Payment Period during
' which the Interceptor System is in operation, each Contracting
I
0 Party shall or may discharge into the Interceptor System, at
I its Point or Points of Entry hereinafter described, all of the
I Wastewater which is required, or permitted to be, discharged
into the District's Treatment System by such Contracting Party
i
under the Treatment Contracts, subject to the restrictions
hereinafter stated; and provided that each such Contracting
I
S
I
I
I
6
u
Party must transport such Wastewater to its Point or Points of
Entry into the Interceptor System.
(b) The maximum rate at which Wastewater is discharged by
each Contracting Party at its Point or Points of Entry into the
Interceptor System shall not exceed for a period of sixty
minutes a rate which, if continued for a period of twenty-four
hours would equal 3.50 times such Contracting Party's estimated
average daily contributing flow of Wastewater into the Treat-
ment System for the then current Annual Payment Period. The
total quantity of Wastewater discharged into the Interceptor
System shall never exceed the amount which the Interceptor
System and the Treatment System are capable of receiving,
treating, and disposing, unless approved by the District,
subject to terms and conditions to be established by the
District. Notwithstanding the foregoing,.no Contracting Party l+
shall ever make an`yd scharge into the Interceptor System or
the Treatment System which would'cause them to -be overloadedyor
be in violation of its permits from the State of Texas and/or
the United States of America.
(c) Wastewater meeting the quality requirements of
Section 4 of this Contract will be received into the Inter-
ceptor System at the Points of Entry, respectively, to be
established pursuant to mutual agreement between the District
and the affected Contracting Party. Additional Points of Entry
may be established by mutual agreement between the District and
a Contracting Party in the future if such additional Points of
Entry are determined by the District to be beneficial to the
Interceptor System.
(d) It is the intention of the Contracting Parties that
the Interceptor System shall be acquired, constructed, ex-
tended, and improved so that at all reasonable times it will be
' capable, of receiving and transporting all eligible Wastewater
i of each Contracting Party which such Contracting Party is
required or permitted to discharge into the District's Treat-
ment System pursuant to the Treatment Contracts, and that the
I
7
A
+v
f
i
District will from time to time issue its Bonds in such amounts
I as are, within its judgment and discretion, sufficient to
i
achieve such results. It is further the intention of the
Contracting Parties that the District shall issue or use its
I best efforts to issue its Bonds for such purpose, and to
provide improvements, enlargements, and extensions to the
0 Interceptor System as needed, for the Initial Contracting
Parties, and as needed by Additional Contracting Parties.
Section 4. QUALITY. Each Contracting Party shall dis-
charge into the Interceptor System only such Wastewater as it
is required or permitted to discharge into the District's
Treatment System, and will not discharge into the Interceptor
System any wastes prohibited by the Treatment Contracts.
s
Section 5. METERING OF WASTEWATER. The District will'
furnish, install, operate, and maintain at its expense the
necessary equipment and devices of standard type required for
measuring properly all Wastewater discharged, into the Dis-
trict's Treatment System by each Contracting Party,- respect-
ively, under the Treatment Contracts. Such meters and other
equipment shall remain the property of the District. Each
Contracting Party shall have access to such metering equipment
at all reasonable times for inspection and examination, but the
reading, calibration, and adjustment thereof shall be done only
by employees or agents of the District in the presence of a
I representative of the affected Contracting Party or Parties if
requested by such Contracting Party or Parties. All readings
of meters will be entered upon proper books of record main-
tained by the District. Upon written request any Contracting
Party may have access to said record books during reasonable
business hours. Not more than three times iii each year of
operation, the District shall calibrate its meters, if re-
quested in writing by the affected Contracting Party or Parties
I to do so, in the presence of a representative of such Contract-
ing Party or Parties, and such parties shall jointly observe
I
8
U
any adjustments which are made to the meters in case any
adjustment is found to be necessary. If, for any reason, any
meters are out of service or out of repair, or if, upon any
test, the percentage of inaccuracy of any meter is found to be
in excess of five (5%) per cent, registration thereof shall be
corrected for a period of time extending back to the time when
such inaccuracy began, if such time is ascertainable, and if
11.
not ascertainable, then for a period extending back one-half
(1/2) of the time elapsed since the date of the last calibra-
tion, but in no event further back than a period of six (6)
months. Any Contracting Party may, at its option and its own
expense, install and operate a check meter to check each meter
installed by the District, but the measurement for the purpose
of this agreement shall be solely by the District's meters,
except as in this Section specifically provided to the con-
trary. All such check meters shall be of standard make and
shall be subject at all reasonable times to inspection and
examination by any employee or agent of the District, but the
reading, calibration, and adjustment thereof shall be made only
by the Contracting Party or Parties, except during any period
when a check meter may be used under specific written consent
by the District for measuring the amount of Wastewater de-
livered into the Treatment System, in which case the reading,
calibration, and adjustment thereof shall be made by the
District with like effect as if such check meter or meters had
been furnished or installed by the District.
Section 6. UNIT OF MEASUREMENT. The unit of measurement
for Wastewater discharged into the Interceptor System and the
Treatment System shall be 1,000 gallons, U. S. Standard Liquid
Measure.
Section 7. LIABILITY FOR DAMAGES AND RESPONSIBILITY FOR
WASTEWATER. Liability for damages arising from the transporta-
tion, delivery, reception, treatment, and/or disposal of all
Wastewater discharged into the Interceptor System hereunder
U
shall remain in each Contracting Party to its Point or Points
of Entry, respectively, into the Interceptor System, and title
to such Wastewater shall be in such Contracting Party to such
Point or Points, and upon passing through Points of Entry
liability for such damages shall pass to the District. As
between the District and each Contracting Party, each party
agrees to indemnify and to save and hold the other party
harmless from any and all claims, demands, causes of action,
damages, losses, costs, fines, and expenses, including reason-
able'attorney's fees, which may arise or be asserted by anyone
at any time on account of the transportation, delivery, recep-
tion, treatment, and/or disposal while title to the Wastewater
is in such party, or on account of a prohibited discharge by a
Contracting Party. The District has the responsibility as
between the parties for the proper reception, transportation,
treatment, and disposal of all Wastewater discharged into the
Interceptor System, but not for prohibited discharges dis-
charged by any party at any Point of Entry.
Section 8. OTHER CONTRACTS. (a) The District reserves
the right to enter into contracts to provide the Wastewater
transportation services of the Interceptor System to Additional
Contracting Parties under contracts similar to this Contract,
subject to the requirements concerning "minimums" and other
matters as hereinafter provided; provided, however, that prior
to or concurrently with becoming an Additional Contracting
Party under this Contract such party must enter into a Treat-
ment Contract with the District in connection with the Treat-
ment System. Each contract with any Additional Contracting
Party shall comply with the requirements of this Contract,
shall substantially restate the essential provisions of this
Contract, and shall be structured to be similar hereto to the
fullest extent applicable and practicable, with such additions
or changes as are necessary to meet the actual circumstances,
with the effect that each Additional Contracting Party will
10
substantially adopt the provisions of this Contract, as supple-
MPntod and nPcQssari c1140ged I,s, i rp rpnI I: 11q, vgl ; I_h
District shall not obligate itself to receive Wastewater into
the Interceptor 'System from any future Additional Contracting
Party if, in the judgment and discretion of the District, such
obligation would jeopardize the District's ability to meet its
obligation to receive and transport Wastewater discharged into
the Interceptor System by prior Contracting Parties, including
specifically the Initial Contracting Parties.
(b) Notwithstanding the foregoing a party may become an
Additional Contracting Party only in the following manner and
under the following conditions:
(i) A formal request must be submitted to the
District by the proposed Additional Contracting Party
furnishing information on the area to be served, a de-
scription of existing facilities, and the latest annual
audit of such proposed Additional Contracting Party's
waterworks and/or sewer systems, if any.
(ii) Such proposed Additional Contracting Party must
provide funds for any necessary engineering studies if
funds are not available therefor from the appropriate
Federal or State agencies. The preliminary studies must
determine or estimate, for the ensuing five year period,
the size and type of any proposed improvements, enlarge-
ments, or extensions to the Interceptor System to serve
such Additional Contracting Party, their estimated cost,
and estimated flows of Wastewater, so as to enable the
District to ascertain or estimate the requirements of the
proposed Additional Contracting Party for the ensuing five
year period.
(iii) After all preliminary data is developed, the
Board of Directors of the District shall call for a
hearing on the matter and notify all Contracting Parties
to review the request of the proposed Additional
11
Contracting Party. The Board of Directors of the District
then shall determine if the proposed Additional Contract-
ing Party should become an Additional Contracting Party.
If so determined, the Board of. Directors then may author-
ize the District to enter into the required contract with
such Additional Contracting Party as provided in this
Contract, and may authorize any Bonds required in connec-
tion with such Additional Contracting Party.
(iv) Each such contract with an Additional Contract-
ing Party must provide for minimum payments under its
contract, on the basis of estimated annual minimum flows
into the District's Treatment System, that would provide
amounts annually at least sufficient, as determined by the
District, to pay that portion of the annual Operation and
Maintenance Component of the Annual Requirement which is
attributable to that part of the Interceptor System
provided by the District to serve such Additional Con-
tracting Party, and to pay that portion of the Bond
Service Component of each Annual Requirement attributable
to Bonds issued within five years from the date of such
contract to acquire or improve any new and additional
facilities for the Interceptor System to serve in whole or
in part such Additional Member City, plus a percentage of
the Bond Service Component of each future Annual Require-
ment for all then outstanding Bonds equal to the then
estimated percentage of use by such proposed Additional
Contracting Party of any portion of the then existing
Interceptor System.
(c) It is further recognized and agreed that in the
future the District may provide services of the Interceptor
System to parties which are not Additional Contracting Parties,
provided that all such services of the Interceptor System to
parties which are not Additional Contracting Parties shall in
all respects be subordinate to the prior rights of the
12
Contracting Parties, and all contracts or other arrangements
relating to such services shall. recognize, and be made siabo:rda.-
tidtt W, suuh vtlul tlyhLs.
Section 9. FISCAL PROVISIONS. (a) Subject to the terms
and provisions of this Contract, the District will provide and
pay for the cost of the acquisition and construction of all
Interceptor System facilities, by using its best efforts to
issue its Bonds in amounts which will be sufficient to accom-
plish such purposes, and the District will own and operate the
Interceptor System. It is acknowledged and agreed that pay-
ments to be made under this Contract and similar contracts with
Additional Contracting Parties, if any, will be the basic
source available to the District to provide the Annual Require-
ment, and that, in compliance with the District's duty to fix
and from time to time revise the rates of compensation or
charges for services of the Interceptor System rendered and
I
made avail i le by the District, the Annual Requirement will
change from time to time, and that each such Annual Requirement
shall be allocated among the Contracting Parties as hereinafter
provided, and that the Annual Requirement for each Annual
Payment Period shall be provided for in each Annual Budget and
shall at all times be not less than an amount sufficient to pay
or provide for the payment of:
(A) An "Operation and Maintenance Component" equal to the
amount paid or payable for all Operation and Mainte-
nance Expenses of the Interceptor System; and
(B) A "Bond Service Component" equal to:
(1) the principal of, redemption premium, if any',
and interest on, its Bonds, as such principal,
redemption premium, if any, and interest become
due, less interest to be paid out of Bond
proceeds or from other sources if permitted by
any Bond Resolution, and all amounts required to
redeem any Bonds prior to maturity when and as
13
provided in any Bond Resolution; and
(2) the proportionate amount of any special,
contingency, or reserve funds required to be
aqc)w11akPd qnd m0nkOnO
any Bond Resolution; and
(3) any amount in addition thereto sufficient to
restore any deficiency in any of such funds
required to be accumulated and maintained by the
provisions of any Bond Resolution.
Section 10. ANNUAL BUDGET. Each Annual Budget for the
Interceptor System shall always provide for amounts sufficient
to pay the Annual Requirement. On or before July 1 of each
fiscal year during the term of this Contract, commencing with
July 1, 1984, the District shall furnish to each Contracting
Party a preliminary estimate of the Annual Payment required
from each Contracting Party for the next following Annual
Payment Period. Not less than forty days before the commence-
ment of each such Annual Payment Period under this Contract
the District shall cause to be prepared as herein provided its
preliminary budget for the Interceptor System for the next
ensuing Annual Payment Period, which budget shall specifically
include the Operation and Maintenance Component and the Bond
Service Component. A copy of such preliminary budget shall be
filed with each Contracting Party together with an estimated
schedule of monthly payments to be made by each Contracting
Party. The preliminary budget shall be subject to examination,
at reasonable times during business hours, at the office of the
City Secretary of each Contracting Party. If no protest or
request for a hearing on such preliminary budget is presented
to the District within thirty days after such filing of the
preliminary budget by one or more Contracting Parties or by the
owners of a minimum of 25% in principal amount of the Bonds
then outstanding, the preliminary budget for the Interceptor
System shall be considered for all purposes as the "Annual
14
Budget" for the next ensuing Annual Payment Period. But if
p1 4_►I_ppl m I a1111t,141 1 411 n Ilan► I ►iq 1A 41111y I' I lad, It, alfa I ) lip 1110
duty of the District to fix the date and time for a hearing on
the preliminary budget, and to give not less than ten days
notice thereof to the Contracting Parties. An appropriate
Committee of the District shall consider the testimony and
showings made in such hearing and shall report its findings to
the Board of Directors of the District. The Board of Directors
may adopt the preliminary budget or make such amendments
thereof as to it may seem proper. The budget thus approved by
the Board of Directors of the District shall be the Annual
Budget for the next ensuing Annual Payment Period. The Annual
Budget may be amended by the District at any time to transfer
from one division thereof to another funds which will not be
needed by such division. The amount for any division, or the
amount for any purpose, in the Annual Budget may be increased
through formal action by the Board of Directors of the District
even though such action might cause the total amount of the
Annual Budget to be exceeded; provided that such action shall
be taken only in the event of an emergency or special circum-
stances which shall be clearly stated in a resolution at the
time such action is taken by the Board of Directors. Certified
copies of the amended Annual Budget and resolution shall be
filed immediately by the District with each Contracting Party.
Section 11. PAYMENTS BY CONTRACTING PARTIES. (a) For
the Wastewater transportation services to be provided to the
Contracting Parties under this Contract, each of the Contract-
ing Parties agrees to pay, at the time and in the manner
hereinafter provided, its proportionate share of the Annual
Requirement, which shall be determined as herein described and
shall constitute a Contracting Party's Annual Payment. Each of
the Contracting Parties shall pay its part of the Annual
Requirement for each Annual Payment Period directly to the
District, in monthly installments, on or before the 10th day of
15
each month, in accordance with the schedule of payments fur-
nished by the District, as hereinafter provided.
(b) Por each hnnuai payment- Period each Contracting
Party's proportionate share of the Annual Requirement shall be
a percentage obtained by dividing the number of gallons of
contributing flow of Wastewater estimated to be discharged into
the District's Treatment System by such Contracting Party
pursuant to the Treatment Contracts during such Annual Payment
Period, as determined by the District after consultation with
such Contracting Party, by the aggregate total number of
gallons of contributing flow of Wastewater estimated to be
discharged into the District's Treatment System by all Con-
tracting Parties pursuant to the Treatment Contracts during
such period, as determined by the District after consultation
with all of the Contracting Parties. All such payments for
each Annual Payment Period shall be made in accordance with a
written schedule of payments for the appropriate Annual Payment
Period which will be supplied to each of the Contracting
Parties by the District. At the close of each Annual Payment
Period the District shall determine the actual metered number
of gallons of contributing flow of Wastewater discharged into
the District's Treatment System by each Contracting Party
pursuant to the Treatment Contracts during said period and
determine each Contracting Party's actual percentage of the
Annual Requirement by dividing such Contracting Party's actual
metered contributing flow into the Treatment System- by the
actual metered contributing flow of all Contracting Parties
into the Treatment System. Each Contracting Party's Adjusted
Annual Payment shall be calculated by multiplying each such
Contracting Party's redetermined percentage times the actual
Annual Requirement. The difference between the amounts which
actually have been paid by each Contracting Party and the
amounts actually due from such Contracting Party hereunder
shall be applied as a credit or a debit to such Contracting
16
Party's account with the District and shall be credited or
debited to such Contracting Party's next monthly payment or
payments, or as otherwise agreed between the District and the
affected Contracting Party, provided that all such credits and
debits shall be made in a timely manner not later than the end
of the next following Annual Payment Period.
(c) Notwithstanding the provisions of (b), above, and as
an exception thereto, it is agreed that if, during any Annual
Payment Period, the estimated and/or actual metered contribut-
ing flow of Wastewater into the District's Treatment System of
any Contracting Party pursuant to the Treatment Contracts is,
for any reason whatsoever, less than the minimum amount herein-
after prescribed and provided for it, such Contracting Party
shall pay its share of each Annual Requirement as if its
estimated and/or actual metered contributing flow of Wastewater
into the District's Treatment System pursuant to the Treatment
Contracts were such minimum amount. However, if such Contract-
ing Party's estimated and/or actual metered contributing flow
of Wastewater into the District's Treatment System is equal to
or in excess of such minimum amount, its share of all of each
Annual Requirement shall be calculated on the basis of esti-
mated and actual contributing flow as provided in (b), above.
All contracts with Additional Contracting Parties shall provide
for equitable minimums similar to those provided for below.
Such minimums shall be fixed in amounts as required by Section
8(b) hereof, as determined by the District, and also shall be
at least sufficient, as determined by the District, to assure
an initial annual payment by such Additional Contracting Party
for not less than the amount of its estimated contributing flow
of Wastewater into the District's Treatment System during the
first year of service under such contract. For the purpose of
calculating the minimum percentage of each Annual Requirement
for which each Initial Contracting Party is unconditionally
liable, without offset or counterclaim (also see Section 14
17.
hereof), the contributing flow of Wastewater into the Dis-
trict's Treatment System of each Initial Contracting Party
pursuant to the Treatment Contracts, during each Annual Payment
Period, shall be deemed to be not less than the minimum amount
(regardless of whether or not such amount was actually dis-
charged into the District's Treatment System pursuant to the
Treatment Contracts) specified for such Initial Contracting
Party as follows:
City of Allen: gallons
City of McKinney: gallons
City of Plano: gallons
City of Richardson: gallons
(d) Notwithstanding the foregoing, the Annual Require-
ment, and each Contracting Party's share thereof shall be
redetermined, after consultation with each of the Contracting
Parties, at any time during any Annual Payment Period, to the
extent deemed necessary or advisable by the District, if:
(i) The District commences furnishing services of the
Interceptor System to an Additional Contracting Party
or Parties;
(ii) Unusual, extraordinary, or unexpected expenditures
for Operation and Maintenance Expenses are required
which are not provided for in the District's Annual
Budget for the Interceptor System or in any Bond
Resolution;
(iii) Operation and Maintenance Expenses are substantially
less than estimated;
(iv) The District issues Bonds which require an increase
in the Bond Service Component of the Annual Payment;
or
(v) The District receives either significantly more or
significantly less revenues or other amounts than
those anticipated.
IA
(e) During each Annual Payment Period all revenues
received by the District from providing services of the Inter-
I.Ophil AV41 fsln hi I+Nl 1 1P4 wliwh flip 11111 (`1+111 IAO 111(( Nfil I !"At
shall (i) first be credited to the Operation and Maintenance
Component of the Annual Requirement, and (ii) then any remain-
der credited to the Bond Service Component of the Annual
Requirement, with the result that such credits under (i) and
(ii), respectively, shall reduce, to the extent of such
credits, the amounts of such Components, respectively, which
otherwise would be payable by the Contracting Parties pursuant
to the method prescribed in (b) and (c), above. The District
may estimate all such credits which it expects to make during
each Annual Payment Period in calculating each Annual Payment.
(f) Each Contracting Party hereby agrees that it will
make payments to the District required by this Section on or
before the 10th day of each month of each Annual Payment
Period. If any Contracting Party at any time disputes the.
amount to be paid by it to the District, such complaining party
shall nevertheless promptly make such payment or payments, but
if it is subsequently determined by agreement or court decision
that such disputed payments made by such complaining party
should have been less, or more, the District shall promptly
revise and reallocate the charges among all Contracting Parties
in such manner that such complaining party will recover its
overpayment or the District will recover the amount due it.
All amounts due and owing to the District by each Contracting
Party or due and owing to any Contracting Party by the District
shall, if not paid when due, bear interest at the rate of ten
(10) percent per annum from the date when due until paid. The
District shall, to the extent permitted by law, discontinue the
services of the Interceptor System to any Contracting Party
which remains delinquent in any payments due hereunder for a
period of sixty days, and shall not resume such services while
such Contracting Party is so delinquent. It is further
19
provided and agreed that if any Contracting Party should remain
delinquent in any payments due hereunder for a period of one
hundred twenty days, and if such delinquency continues during
any period thereafter, such Contracting Party's minimum amount
of gallons of Wastewater specified and described in (c), above,
��� shall be deemed to have been zero gallons during all periods of
such delinquency, for the purpose of calculating and redeter-
mining the percentage of each Annual Payment to be paid by the
non -delinquent Contracting Parties, and the District shall
redetermine such percentage on that basis in such event so that
the non -delinquent Contracting Parties collectively shall be
required to pay all of the Annual Requirement. However, the
District shall pursue all legal remedies against any such
delinquent Contracting Party to enforce and protect the rights
of the District, the other Contracting Parties, and the owners
of the Bonds, and such delinquent Contracting Party shall not
be relieved of the liability to the District for the payment of
all amounts which would have been due hereunder, in the absence
of the next preceding sentence. It is understood that the
foregoing provisions are for the benefit of the owners of the
Bonds so as to insure that all of the Annual Requirement will
be paid by the non -delinquent Contracting Parties during each
Annual Payment Period regardless of the delinquency of a
Contracting Party. If any amount due and owing by any Con-
tracting Party to the District is placed with an attorney for
collection, such Contracting Party shall pay to the District
all attorneys fees, in addition to all other payments provided
for herein, including interest.
(g) If, during any Annual Payment Period, any Contracting
Party's Annual Payment is redetermined in any manner as pro-
vided or required in this Section, the District will promptly
furnish such Contracting Party with an updated schedule of
monthly payments reflecting such redetermination.
20
I
Section 12. SPECIAL PROVISIONS. (a) The District will
continuously operate and maintain the Interceptor System in an
efficient manner and in accordance with good business and
engineering practices, and at reasonable cost and expense.
(b) The District agrees to carry fire, casualty, public
liability, and other insurance on the Interceptor System for
purposes and in amounts which ordinarily would be carried by a
privately owned utility company owning and operating such
facilities, except that the District shall not be required to
carry liability insurance except to insure itself against risk
of loss due to claims for which it can, in the opinion of the
District's legal counsel, be liable under the Texas Tort Claims
Act or any similar law or judicial decision. Such insurance
will provide, to the extent feasible and practicable, for the
restoration of damaged or destroyed properties and equipment,
to minimize the interruption of the services of such facili-
ties. All premiums for such insurance shall constitute an
Operation and Maintenance Expense of the Interceptor System.
(c) It is estimated that the Interceptor System will be
placed in operation as soon as practicable. It is expressly
understood and agreed, however, that any obligations on the
part of the District to acquire, construct, and complete the
Interceptor System and to provide the services of the Inter-
ceptor System to the Contracting Parties shall be (i) con-
ditioned upon the District's ability to obtain all necessary
permits, material, labor, and equipment, and upon the ability
of the District to finance the cost of the Interceptor System
through the actual sale of the District's Bonds and (ii)
subject to all present and future valid laws, orders, rules,
and regulations of the United States of America, the State of
�1" Texas, and any regulatory body having jurisdiction.
(d) The District shall never have the right to_demand
payment by any Contracting Party of any obligations assumed by
it or imposed on it under and by virtue of this Contract from
21 J
funds raised or to be raised by taxes, and the obligations
under this Contract shall never be construed to be a debt of
such kind as to require any of the Contracting Parties to levy
and collect a tax to discharge such obligation.
(e) Each of the Initial Contracting Parties, respect-
ively, represents and covenants that all payments, including
indemnity payments, to be made by it under this Contract shall
constitute reasonable and necessary "operating expenses" of its
combined waterworks and sewer system, as defined in Vernon's
Ann. Tex. Civ. St. Article 1113, and that all such payments
will be made from the revenues of its combined waterworks and
sewer system. Each of the Contracting Parties, respectively,
represents and has determined that the services to be provided
by the Interceptor System are absolutely necessary and essen-
tial to the present and future operation of its combined water
and sewer system, and that the Interceptor System constitutes
the reasonable and necessary method for transporting its
Wastewater into the District's Treatment System, and, accord-
ingly, all payments required by this Contract to be made by
each Contracting Party shall constitute reasonable and neces-
sary operating expenses of its combined water and sewer system
as described above, with the effect that the obligation to make
such payments from revenues of such combined water and sewer
system shall have priority over any obligation to make any
payments from such revenues of principal, interest, or other-
wise, with respect to all bonds or other obligations heretofore
or hereafter issued by such Contracting Party.
(f) Each of the Contracting Parties agrees throughout the
term of this Contract to continuously operate and maintain its
combined waterworks and sewer system and to fix and collect
such rates and charges for water. and sewer services and/or
sewer services to be supplied by its combined waterworks and
sewer system as aforesaid as will produce revenues in an amount
equal to at least (i) all of the expenses of operation and
22
maintenance expenses of such system, including specifically its
payments under this Contract, and (ii) all other amounts as
required by law and the provisions of the ordinances or resolu-
tions authorizing its revenue bonds or other obligations now or
hereafter outstanding, including the amounts required to pay
all principal of and interest on such bonds and other obliga-
tions.
Section 13. FORCE MAJEURE. If by reason of force majeure
any party hereto shall be rendered unable wholly or in part to
carry out its obligations under this Contract, other than the
obligation of each Contracting Party to make the payments
required under Section 11 of this Contract, then if such party
shall give notice and full particulars of such force majeure in
writing to the other parties within a reasonable time after
occurrence of the event or cause relied on, the obligation of
the party giving such notice, so far as it is affected by such
force majeure, shall be suspended during the continuance of the'
inability then claimed, but for no longer period, and any such
party shall endeavor to remove or overcome such inability with
all reasonable dispatch. The term "Force Majeure" as employed
herein shall mean acts of God, strikes, lockouts, or other
industrial disturbances, acts of public enemy, orders of any
kind of the Government of the United States or the State of
Texas, or any Civil or military authority, insurrection, riots,
epidemics, landslides, lightning, earthquake, fires, hurri-
canes, storms, floods, washouts, droughts, arrests, restraint
of government and people, civil disturbances, explosions,
breakage or accidents to machinery, pipelines or canals,
partial or entire failure of water supply, or on account of any
other causes not reasonably within the control of the party
claiming such inability.
Section 14. UNCONDITIONAL OBLIGATION TO MAKE PAYMENTS.
Recognizing the fact that the Contracting Parties urgently
require the facilities and services of the Interceptor System,
23
and that such facilities and services are essential and neces-
H?II 1l I III W l Ilii 1 Ili i mid I III Id mill1h,I, Iilll pilil-1,, 111111 1 w -likIll( f IIIEI
the fact thnL Ilit, DInLi.-1cL wi.l J use paymciiLn received from the
Contracting Parties to pay and secure its Bonds, it is hereby
agreed that each of the Contracting Parties shall be uncon-
ditionally obligated to pay, without offset or counterclaim,
its proportionate share of the Annual Requirement, as provided
and determined by this Contract (including the obligations for
paying for "minimums" as described in Section 11 hereof),
regardless of whether or not the District actually acquires,
constructs, or completes the Interceptor System or is actually
operating or providing services of the Interceptor System to
any Contracting Party hereunder, or whether or not any Con-
tracting Party actually uses the services of the Interceptor
System whether due to Force Majeure or any other reason whatso-
ever, regardless of any other provisions of this or any other
contract or agreement between any of the parties hereto. This
covenant by the Contracting Parties shall be for the benefit of
and enforceable by the holders of the Bonds and/or the Dis-
trict.
Section 15. TERM OF CONTRACT; MODIFICATION; NOTICES;
STATE OR FEDERAL LAWS, RULES, ORDERS, OR REGULATIONS. (a)
This Contract shall be effective on and from the Contract Date,
and this Contract shall continue in force and effect until the
principal of and interest on all Bonds shall have been paid,
and thereafter shall continue in force and effect during the
entire useful life of the Interceptor System.
(b) Modification. No change, amendment, or modification
of this Contract shall be made or be effective which will
affect adversely the prompt payment when due of all moneys
required to be paid by each Contracting Party under the terms
of this Contract and no such change, amendment, or modification
shall be made or be effective which would cause a violation of
any provisions of any Bond Resolution.
24
(c) Addresses and Notice. Unless otherwise provided
herein, any notice, communication, request, reply, or advice
(herein severally and collectively, for convenience, called
"Notice") herein provided or permitted to be given, made, or
accepted by any party to any other party must be in writing and
may be given or be served by depositing the same in the United
States mail postpaid and registered or certified and addressed
to the party to be notified, with return receipt requested, or
by delivering the same to an officer of such party, or by
prepaid telegram when appropriate, addressed to the party to be
notified. Notice deposited in the mail in the manner herein-
above described shall be conclusively deemed to be effective,
unless otherwise stated herein, from and after the expiration
of three days after it is so deposited. Notice given in any
other manner shall be effective only if and when received by
the party to be notified. For the purposes of notice, the
addresses of the parties shall, until changed as hereinafter
provided, be as follows:
�l If to the District, to:
North Texas Municipal Water District
P. 0. Drawer C
Wylie, Texas 75098
If to the Initial Contracting Parties, as follows:
City of Allen
One Butler Circle
Allen, Texas 75002
City of McKinney
130 South Chestnut
McKinney, Texas 75069
City of Plano
1520 Avenue K
Plano, Texas 75074
City of Richardson
411 W. Arapaho Road
Richardson, Texas 75080
The parties hereto shall have the right from time to time and
at any time to change their respective addresses and each shall
have the right to specify as its address any other address by
25
at least fifteen (15) days' written notice to the other parties
hereto.
(d) State or Federal Laws, Rules, Orders, or Regulations.
This Contract is subject to all applicable Federal and State
laws and any applicable permits, ordinances, rules, orders, and
regulations of any local, state, or federal governmental
authority having or asserting jurisdiction, but nothing con-
tained herein shall be construed as a waiver of any right to
question or contest any such law, ordinance, order, rule, or
regulation in any forum having jurisdiction.
Section 16. SEVERABILITY. The parties hereto specifical-
ly agree that in case any one or more of the sections, subsec-
tions, provisions, clauses, or words of this Contract or the
application of such sections, subsections, provisions, clauses,
or words to any situation or circumstance should be, or should
be held to be, for any reason, invalid or unconstitutional,
under the laws or constitutions of the State of Texas or the
United States of America, or in contravention of any such laws
or constitutions, such invalidity, unconstitutionality, or
contravention shall not affect any other sections, subsections,
provisions, clauses, or words of this Contract or the applica-
tion of such sections, subsections, provisions, clauses, or
words to any other situation or circumstance, and it is in-
tended that this Contract shall be severable and shall be
construed and applied as if any such invalid or unconstitu-
tional section, subsection, provision, clause, or word had not
been included herein, and the rights and obligations of the
parties hereto shall be construed and remain in force accord-
ingly.
Section 17. REMEDIES UPON DEFAULT. It is not intended
hereby to specify (and this Contract shall not be considered as
specifying) an exclusive remedy for any default, but all such
other remedies (other than termination) existing at law or in
equity may be availed of by any party hereto and shall be
26
cumulative. Recognizing however, that the District's under-
taking to provide and maintain the services of the Interceptor
System is an obligation, failure in the performance of which
cannot be adequately compensated in money damages alone, the
District agrees, in the event of any default on its part, that
each Contracting Party shall have available to it the equitable
remedy of mandamus and specific performance in addition to any
other legal or equitable remedies (other than termination)
which may also be available. Recognizing that failure in the
performance of any Contracting Party's obligations hereunder
could not be adequately compensated in money damages alone,
each Contracting Party agrees in the event of any default on
its part that the District shall have available to it the
equitable remedy of mandamus and specific performance in
addition to any other legal or equitable remedies (other than
termination) which may also be available to the District.
Notwithstanding anything to the contrary contained in this
Contract, any right or remedy or any default hereunder, except
the right of the District to receive the Annual Payment which
shall never be determined to be waived, shall be deemed to be
conclusively waived unless asserted by a proper proceeding at
law or in equity within two (2) years plus one (1) day after
the occurrence of such default. No waiver or waivers of any
breach or default (or any breaches or defaults) by any party
hereto or of performance by any other party of any duty or
obligation hereunder shall be deemed a waiver thereof in the
future, nor shall any such waiver or waivers be deemed or
construed to be a waiver of subsequent breaches or defaults of
any kind, character, or description, under any circumstances.
Section 18. VENUE. All amounts due under this Contract,
including, but not limited to, payments due under this Contract
or damages for the breach of this Contract, shall be paid and
be due in Collin County, Texas, which is the County in which
the principal administrative offices of the District are
27
located. It is specifically agreed among the -parties to this
Contract that Collin County, Texas, is the place of performance
of this Contract; and in the event that any legal proceeding is
brought to enforce this Contract or any provision hereof, the
same shall be brought in Collin County, Texas.
IN WITNESS WHEREOF, the parties hereto acting under
authority of their respective governing bodies have caused this
Contract to be duly executed in several counterparts, each of
which shall constitute an original, all as of the day and year
first above written, which is the date of this Contract.
NORTH TEXAS MUNICIPAL WATER DISTRICT
BY
President, Board of Directors
ATTEST:
Secretary, Board of Directors
(DISTRICT SEAL)
CITY OF ALLEN, TEXAS
BY 0
Mayor
ATTEST:
La,4 4,
%v
L�4
City S retary
(CITY SEAL)
ATTEST:
City Secretary
i
(CITY SEAL)
CITY OF McKINNEY, TEXAS
BY
Mayor
28
4.
ATTEST:
City Secretary
�•..� (CITY SEAL)
ATTEST:
City Secretary
(CITY SEAL)
CITY OF PLANO, TEXAS
BY
Mayor
CITY OF RICHARDSON, TEXAS
BY
Mayor
29