4305 Santa Fe Avenue, Vernon, CA, 90058
CityofVernon.org
VPU CAPACITY RESERVATION AGREEMENT
This Capacity Reservation Agreement (“Capacity Reservation Agreement”) establishes the terms on which the City of Vernon, a California charter City and California municipal corporation (the “City”), Vernon Public Utilities Department (“VPU”) will offer, and the undersigned customer (“Customer”) will make, a reservation (“Reservation”) for a specified number of megawatts (“MW”) of electric capacity, subject to the conditions described herein. VPU and Customer are sometimes referred to herein individually as “Party” and together as the “Parties.” Customers eligible to execute this Capacity Reservation Agreement are VPU’s existing or prospective commercial and industrial customers who have received a “Will Serve” letter from VPU for between 3.5 MW and 99 MW of electric capacity to serve their Property (“Eligible Customers”).
RECITALS
WHEREAS, Customer has requested, and has received, a “Will Serve” letter from VPU on […], serving as confirmation that VPU is able to provide […] megawatts (“MW”) of electrical capacity at […] (the “Property”).
WHEREAS, Customer requires additional assurance that VPU will provide, as a firm and binding commitment and reservation of, such electrical capacity to the Property at the time electric service is needed by or called by Customer and/or Customer’s tenants and/or licensees.
WHEREAS, Customer is relying on such assurance, reservation, and commitment in developing and improving the Property.
WHEREAS, VPU is able to provide such additional assurance through this Capacity Reservation Agreement, wherein VPU will guarantee, for a specified term, the availability of the requested electrical capacity to the Property to Customer in exchange for payment of a Capacity Reservation Charge.
NOW, THEREFORE, the Parties agree as follows:
AGREEMENT
Will Serve Letter – The terms contained within VPU’s Will Serve Letter, appended to this Capacity Reservation Agreement, are incorporated by reference into this Capacity
Reservation Agreement. To the extent the terms set forth therein conflict with this Capacity Reservation Agreement, the terms and conditions of this Capacity Reservation Agreement shall control and prevail.
Capacity Reservation – “Capacity Reservation” refers to VPU’s commitment hereby to provide a specified number of MW of electric capacity to the Property for a specified term.
Capacity Reservation Cap – Customer may elect to reserve up to […] MW of electric capacity from City to the Property.
Customer Reservation Election – Customer elects to reserve […] of electric capacity for a term of up to five (5) years, and VPU hereby makes a firm and binding commitment to reserve for, and deliver to, Customer and its affiliates, such electric capacity. The Customer Reservation Election shall be for one (1) year, and shall automatically renew for an additional one-year term, for up to four additional oneyear terms, unless Customer provides VPU with a written notice (a) modifying its Capacity Reservation Election for the next one-year term, at least thirty (30) days before the end of the then-current term; or (b) terminating this Agreement, at least thirty (30) days before the end of the then-current term.
Capacity Reservation Charge – In exchange for the Capacity Reservation, Customer will pay an annual Capacity Reservation Charge of […]/MW times the amount of MW set forth in the Customer Reservation Election. Customer’s Capacity Reservation Charge rate (per MW) will not change for the duration of the term of executed Capacity Reservation Agreement.
Billing of Capacity Reservation Charge – Payment of the initial one-year Capacity Reservation Charge is due no later than thirty (30) days after the execution of this Capacity Reservation Agreement. At least thirty (30) days before the scheduled expiration of each subsequent one-year Capacity Reservation Election, VPU will deliver to Customer an invoice for the Capacity Reservation Charge for the next renewal of the Customer Reservation Election. The invoiced Capacity Reservation Charge shall be paid by Customer at the commencement of each successive oneyear term of the Customer Reservation Election unless Customer provides a written notice of termination at least thirty (30) days before the commencement of the successive one-year Customer Reservation Election.
Electric Service – This Capacity Reservation Agreement does not include the provision of Electric Service to the Property by VPU. As explained in the Will Serve Letter, Electric Service will be provided by VPU in accordance with the VPU Rules for Electric Service and in accordance with applicable land-use approvals and City requirements.
Term/Termination – This Capacity Reservation Agreement shall terminate under the following circumstances:
a. the Parties mutually agree in writing to terminate this Capacity Reservation Agreement; or
b. Five (5) years have elapsed from the execution of this Capacity Reservation Agreement.
Effect of Termination - In the event of termination, the Parties shall be relieved of all liability hereunder.
VPU’s Representation – VPU hereby represents and warrants to Customer that, as of the date this Capacity Reservation Agreement is executed and delivered by VPU and over the Term of this Capacity Reservation Agreement: (i) VPU has (and will continue to have) available for the potential future use by Customer the electrical capacity constituting the Capacity Reservation set forth in the paragraph above (named Customer Reservation Election) and (ii) VPU has not (and over the Term shall not) reserve, sell, transfer or commit such power to any third party which conflicts with the commitment and reservation made herein (or enter into any transaction or waiver whose effect would be to cause VPU to be unable to fulfill its covenants and agreements herein as and when required).
Governing Law – This Capacity Reservation Agreement shall be governed by and construed in accordance with the laws of the State of California, without giving effect to any choice of law or conflict of law provisions or rule of any jurisdiction that would cause the substantive laws of any other jurisdiction to apply.
Superseding Effect – This Capacity Reservation Agreement supersedes all prior oral or written agreements or understandings between the parties with respect to the subject matter hereof.
Assignment – This Capacity Reservation Agreement may not be assigned without the non- assigning party’s prior written consent, such consent not to be unreasonably withheld.
Notices - Any notice, request, demand, or determination provided by a Party pursuant to this Capacity Reservation Agreement will be in writing. Notices will be delivered as follows:
To VPU/City: City of Vernon
4305 Santa Fe Avenue
Vernon, CA 90058
To Customer: [Name]
[Address]
A Party may from time to time change its address or designee for notification purposes by giving the other prior notice of the new address or designee and the date upon which it will become effective.
Limitation of Liability - NEITHER PARTY WILL BE LIABLE TO THE OTHER PARTY FOR INDIRECT,
CONSEQUENTIAL, INCIDENTAL, COLLATERAL, EXEMPLARY OR PUNITIVE DAMAGES,
INCLUDING LOST PROFITS, REVENUE, GOODWILL, SAVINGS (REAL OR ANTICIPATED),
REGARDLESS OF THE FORM OF THE ACTION OR THE THEORY OF RECOVERY, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
Jurisdiction and Venue - The Parties agree that for any controversy or claim arising out of or relating to this Agreement, or the breach thereof, brought by either Party, each Party irrevocably agrees that any legal action, suit or proceeding brought by it in any way relating to any dispute must be brought solely and exclusively in the state or federal courts in and for the State of California, Los Angeles County. The Parties irrevocably accept and agree to submit to the sole and exclusive jurisdiction of each of the aforesaid courts, generally and unconditionally with respect to any action, suit or proceeding brought by it or against it by the other Party. The Parties further agree to irrevocably waive their right to trial by jury.
Miscellaneous. The Parties incorporate the recitals set forth above into this Capacity Reservation Agreement. Nothing in this Capacity Reservation Agreement shall confer any rights upon any person other than the Parties hereto and each such Party’s respective heirs, successors and permitted assigns. This Capacity Reservation Agreement may not be amended, modified, varied or supplemented except by an instrument in writing signed by VPU and Customer. This Capacity Reservation Agreement constitutes the entire agreement between the Parties relating to the subject matter hereof and supersedes and replaces any provisions on the same subject contained in any other agreement between the Parties, whether written or oral, prior to the date of the original execution hereof. If any particular provision or portion of this Capacity Reservation Agreement shall be adjudicated to be invalid or unenforceable, such provision or portion thereof shall be deemed amended to the minimum extent necessary to render such provision or portion valid and enforceable, and such amendment will apply only with respect to the operation of such provision or portion in the particular jurisdiction in which such adjudication is made. This Capacity Reservation Agreement may be executed in any number of counterparts and each such counterpart shall be deemed an original agreement for all purposes.
IN WITNESS WHEREOF, the Parties hereto have caused this Capacity Reservation Agreement to be executed by their respective representatives, thereunto duly authorized.
[CUSTOMER NAME], a [Insert State and Corporate Form]
By: ___________________________
Name: _______________________
Title: __________________________
ACCEPTED AND AGREED to this day of __________________
CITY OF VERNON,
a California charter City and California municipal corporation By: ___________________________
Name: _______________________
Title: __________________________
ACCEPTED AND AGREED to this day of __________________
Attest:
_____________________________
[Insert Name], City Clerk
Approved as to form:
_____________________________
[Insert Name], City Attorney