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R-01-06-14-16A1 - 6/14/2001and OA\ WPDOCS \RESOLUTI \R10614A1.WPD /eC RESOLUTION NO. R- 01- 06- 14 -16A1 A RESOLUTION OF THE CITY OF ROUND ROCK, TEXAS APPROVING THE ARTICLES OF INCORPORATION AND THE BYLAWS OF GOVERNMENTAL AGGREGATION PROJECT, INC., A POLITICAL SUBDIVISION CORPORATION; ACCEPTING MEMBERSHIP IN SAID CORPORATION; APPOINTING A REPRESENTATIVE TO SERVE ON BEHALF OF THE CITY OF ROUND ROCK; APPROVING PAYMENT OF AN INITIAL MEMBERSHIP FEE; AND ESTABLISHING AN EFFECTIVE DATE. WHEREAS, Chapter 303 of the Texas Local Government Code, entitled "Energy Aggregation Measures for Local Governments ", allows political subdivisions to form a political subdivision corporation to act as an agent to negotiate the purchase of electricity, or to likewise aid or act on behalf of the political subdivisions for which the corporation is created, with respect to their own electricity use for their respective public facilities, and WHEREAS, Governmental Aggregation Project, Inc. ( "GAP ") is a political subdivision corporation organized under said Chapter, and WHEREAS, the negotiation for electricity by the corporation should result in lower electricity costs to the City of Round Rock, and WHEREAS, the City of Round Rock seeks to become a member of GAP, WHEREAS, the Bylaws of GAP require an initial membership fee of $1,000.00, Now Therefore BE IT RESOLVED BY THE COUNCIL OF THE CITY OF ROUND ROCK, TEXAS THAT, Section 1: The recitals contained in the preamble of this Resolution are determined to be true and correct and are hereby adopted as part of this Resolution. Section 2: The Articles of Incorporation and Bylaws of GAP, a political subdivision corporation, attached hereto and incorporated herein for all purposed as Exhibits A and B respectively, are hereby approved. Section 3: The City of Round Rock accepts membership in GAP. Section 4: The City of Round Rock approves payment of an initial membership fee of $1,000.00 in accordance with Article 5 of the Bylaws. Section 5: The City of Round Rock hereby appoints Robert L. Bennett, Jr., City Manager, to serve as the City of Round Rock's representative to the corporation and to act on the City of Round Rock's behalf. Section 6. All Resolutions and parts thereof in conflict herewith are hereby expressly repealed insofar as they conflict herewith. Section 7. This Resolution shall take effect immediately from and after its adoption and it is accordingly so resolved. The City Council hereby finds and declares that written notice of the date, hour, place and subject of the meeting at which this Resolution was adopted was posted and that such meeting was open to the 2 public as required by law at all times during which this Resolution and the subject matter hereof were discussed, considered and formally acted upon, all as required by the Open Meetings Act, Chapter 551, Texas Government Code, as amended, and the Act. RESOLVED this 14th day of June, 2001. ATTEST: J LAND, City Secretary 3 City of Round Rock, Texas MAY -29 -2001 09:46 CITY OF ROUND ROCK 5122107097 P.18/22 ARTICLES OF INCORPORATION OF GOVERNMENTAL AGGREGATION PROJECT, INC. ARTICLE ONE The corporation will conduct business under the name Governmental Aggregation Project, Inc. ARTICLE TWO The period of its duration is perpetual ARTICLE THREE The corporation is a non-profit political subdivision corporation authorized by Section 303.001 of Chapter 303, Texas Local Government Code, entitled "Energy Aggregation Measures for Local Governments," as amended ( "Chapter 303 "). ARTICLE FOUR The corporation has been organized for the purposes of purchasing electricity, aiding or acting on behalf of its members with respect to their own electricity use for their respective public facilities and negotiating on behalf of its members for the purchase of electricity, making contracts for the purchase of electricity, and taking any other actions necessary to purchase electricity for use in the public facilities of the political subdivision or subdivisions represented by the corporation as authorized by Chapter 303, Section 303.001(d), and for all other purposes as may be permitted by law for political subdivision corporations. These Articles have been approved by the governing body of each political subdivision for which the corporation is created. ARTICLE FIVE The street address for the corporation's initial registered office is Arboretum Great Hills Center, 9600 Great Hills Trail, Suite 150W, Austin, Texas 78759, and the registered agent for the corporation at this address is Clarence A. West. ARTICLE SIX The corporation shall have political subdivisions as members. Membership shall be determined under the terms and conditions provided in the corporation's bylaws. ARTICLE SEVEN 1 f� EXHIBIT 1 MAY -29 -2001 09:46 The direction and management of the affairs of the corporation and the control and disposition of its properties and 'funds shall be vested in a Board of Directors composed of such number of persons, but not less than three, as may be fixed by the bylaws. Until changed by the bylaws, the original number of directors shall be three (3). The names and addresses of the persons who are to serve as Directors of the corporation until their successors are duly elected and qualified are: 1. Jeff Braun City Manager City of Rosenberg 2110 Fourth Street / P.O.Box 32 Rosenberg, TX 77471 -0032 2. James Thurmond City Manager City of Missouri City 1522 Texas Parkway Missouri City, TX 77459 3. Andres Garza, Jr., City Manager City of Wharton 120 East Caney Street Wharton, TX 77488 CITY OF ROUND ROCK 5122187097 P.19/22 ARTICLE EIGHT The bylaws of the corporation shall be adopted by the Board of Directors and shall be approved by the governing body of each political subdivision Member for which the corporation is created. 1 . Jeff Braun City Manager City of Rosenberg 2110 Fourth Street / P.O. Box 32 Rosenberg, TX 77471 -0032 2. James Thurmond City Manager City of Missouri City ARTICLE NINE The names and addresses of the incorporators are: 2 MRY -29 -2001 09 :47 1522 Texas Parkway Missouri City, TX 77459 3. Andres Garza, Jr., City Manager City of Wharton 120 East Caney Street Wharton, TX 77488 CITY OF ROUND ROCK 5122187097 P.20/22 The undersigned incorporators, all of whom are over the age of eighteen (18) and are citizens of the State of Texas, sign these Articles of h corporation subject to the penalty imposed by Article 9.03A, Texas Non -Profit Corporation Act. ROSENBERG MISSOURI CITY WHARTON 3 Jeff Braun City Manager James Thurmond City Manager Andres Garza, Jr. City Manager CITY OF By: CITY OF By: CITY OF By: MAY -29 -2001 09:47 BEFORE ME, a notary public, on this day personally appeared Jeff Braun, City Manager of the City of Rosenberg, Texas, known to me to be the person whose name is subscribed to the foregoing document and, being by me first duly sworn, declared that the statements therein contained are true and correct. 2001. Given under my hand and seal of office this day of COUNTY OF FORT BEND 1 CITY OF ROUND ROCK 5122187097 P.21/22 THE STATE OF TEXAS I COUNTY OF FORT BEND State of Texas THE STATE OF TEXAS Notary Public, BEFORE ME, a notary public, on this day personally appeared James Thurmond, City Manager of IVTissouri City, Texas, known to me to be the person whose name is subscribed to the foregoing document and, being by me first duly sworn, declared that the statements therein contained are true and correct. Given under my hand and seal of office this day of , 2001. State of Texas 4 Notary Public, MAY -29 -2001 09:47 CITY OF ROUND ROCK 5122187097 P.22/22 THE STATE OF TEXAS 1 COUNTY OF WHARTON 1 BEFORE ME, a notary public, on this day personally appeared Andres Garza, Jr., City Manager of Wharton, Texas, known to me to be the person whose name is subscribed to the foregoing document and, being' by roe first duly sworn, declared that the statements therein contained are true and correct. Given under my hand and seal of office this day of , 2001. 111409\0001\ARTINCGOVOI.wpd . State of Texas 5 Notary Public, TOTAL P.22 MAY-29-2001 09:41 CITY OF ROUND ROCK 5122187097 P.04/22 BYLAWS OF GOVERNMENTAL AGGREGATION PROJECT, INC. ARTICLE 1. Name and Purpose 1.1 Name. This corporation shall be known as Governmental Aggregation Project, Inc. 1.2 Purpose. The corporation has been organized for any and all lawful business for which corporations may be organized under the Texas Non Profit Corporations Act, for the purposes of purchasing electricity, aiding or acting on behalf of its Members with respect to their own electricity use for their respective; public facilities and negotiating on behalf of its Members for the purchase of electricity, making contracts for the purchase of electricity, and taking any other actions necessary to purchase electricity for use in the public facilities of the political subdivision or subdivisions represented by the corporation, for the purposes of acting as a local cooperative organization to purchase goods and ancillary services for its members, in accordance with Texas Local Government Code, Chapter 303, entitled, "Energy Aggregation Measures for Local Governments," Section 303.001(d), and for all other purposes as may be permitted by law for political subdivision corporations.; ARTICLE 2. Board of Directors 2.1 Composition. There shall be a Chair and a Vice Chair on the board and such other directors as required for the performance of duties. 2.2 Powers. The affairs of the Corporation shall be managed by the Board of Directors, which may exercise all such powers of the corporation and do all such lawful acts and things as are not prohibited by statute, by the Articles of Incorporation of the Corporation, or by these Bylaws. By tfustration and without limitation, included among the powers of the Board of Directors is the power to negotiate the purchase of electricity, aid or act on behalf of the political subdivisions for which the corporation is created, make contracts for the purchase of electricity, purchase electricity, and take any other action necessary to purchase electricity for use in the public facilities of the political subdivision or subdivisions represented by the Corporation; provided, however, no Member shall be obligated under any such contract unless the Member approves such contract. 2.3 Number, Tenure and Qualification (a) Directors shall be elected to the Board at annual meetings of the Members as hereinafter described from a slate presented by the Board and from nominations by Members. Nominations for membership on the Board made by Members shall not be considered at any meeting of the Members unless such nomination has been presented in writing, signed by the Member or Members proposing the same, and filed with, the Secretary of the Corporation at least sixty (60) days prior to the date of the meeting at which said nominations are to be considered, except for the first elected Board, as described in Subsections (b) and (c) -1- EXHIBIT MRY -29 -2001 09:42 CITY OF ROUND ROCK 5122187097 P.07/22 below, which shall require thirty (30) days' prior notice. From the nominations so made and no others, and from the slate presented by the Board, Directors shall be elected, and the person or persons receiving the highest number of votes shall be declared elected. If the election of Directors shall not be held on the day designated herein for any annual meeting of the Members, or at any adjournment thereof the Board shall cause the election to be held at a special meeting of the Members, which shall be convened as soon thereafter as is possible. (b) The initial Board of Directors shall consist of three directors, as designated, in Article Seven of the Articles of Incorporation (`Initial Board"). Such Initial Board shall serve until their successors are duly elected and qualified. On or before December 31, 2001, the Metnbers shall elect from its Members an elected Board, with the number of elected Board Members, as determined by the Initial Board by September 1, 2001. The number of Directors may be increased or decreased by resolution of the Board, but no decrease shall have the effect of shortening the term of an incumbent Director. (c) The first elected Directors shall serve until December 31, 2003. The subsequent Board Member Selection Process will be determined by the first elected Board based upon an equitable and fair manner that allows all Members to have representation and must be established before June 1, 2003. The directors elected as a result of using the subsequent Board Member Selection Process shall serve two (2) year staggered terms with directors serving in place numbers that are odd elected in odd numbered years and those serving in place numbers that are even elected in even numbered years. (d) Except for the Initial Board, each Director of the Board must be an official or full time salaried employee of a Member. Any Director who is an official or full-time salaried employee of an entity that ceases to be a Member participant of the Corporation, and any Director who ceases to bean official or full -time salaried employee of a Member, shall be automatically disqualified to serve as a Director, and the position shall become vacant, such vacancy to be filled in the manner provided in Section 2.5 of this Article 2. 2.4 Reinoval. Directors may be removed from office, with or without cause, by an affirmative vote of the majority of the Members then entitled to vote at an election of the Directors at an annual meeting of the Members or a in meeting called expressly for that purpose; provided, no action to remove any Director shall be sufficient unless written notice that such action is to be considered shall have been given to all Members by the Chairman or Secretary at least sixty (60) days before the meeting. 2.5 Vacancies. Any Director may resign at any time by giving written notice to the Secretary of the Corporation. Such resignation shall take effect at the time specified therein; and, unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective. Any vacancy occurring in the Board may be filled by the affirmative vote of a majority of the remaining Directors though less than a quorum. A Director elected to fill a vacancy shall be elected for the unexpired term of his or her predecessor in office. Any place on the Board to be filled by reason of an increase in the number of Directors shall be filled by the affirmative vote of a majority of the Directors then in office. A Director chosen to fill a position resulting from an increase in the number of Directors shall hold office until the next annual meeting of -2- MAY -29 -2001 09:42 CITY OF ROUND ROCK 5122187097 P.08/22 Members, at which time a successor shall be elected to serve until the expiration date set for his or her designated place. 2.6 Regular Meetings. A regular meeting of the Board shall be held annually in conjunction with the annual meeting of Members, for the purpose of organization, election of officers, and consideration of any other business that properly may come before the Board. The Board may provide, by resolution, the time and place for the holding of additional regular meetings. 2.7 Special Meetings. Special: meetings of the Board may be called by the Chairman of the Board or at the written request of any two Directors. The person or persons authorized to call special meetings of the Board may fix the place for holding any special meeting of the Board so called. If no place is fixed, the place of meeting shall be the principal office of the Corporation in Texas. 2.8 Voting, Quorums. A majority of the number of Directors described in by Section 23 shall constitute a quorum for the transaction of business. The act of the majority of the Directors present at a meeting at which a quorum is present shall be the act of the Board, provided, however, the Board may, by resolution, delegate any of its powers in whole or in part, temporarily or permanently, to any Director or committee of Directors then acting; any such delegation shall be by written instrument filed in the records of the Corporation 2.9 Notice of Meetings. Notice for board meetings shall be provided to all Directors and Members either by mail not less than seventy-two (72) hours before the date of the meeting, by telephone, telegram, e-mail or telecopy on twenty -four (24) hours notice or on such shorter notice as the person or persons calling such meeting may deem necessary or appropriate in the circumstances. 2.10 Informal Action by Directors. Any action required to be taken at a meeting of the Directors, or any other action which may be taken at a meeting of the Directors, may be taken without a meeting if a consent or Consensus in writing, setting forth the action so taken, shall be signed by all of the Members with;respect to the subject matter thereof Such consent or consents shall have the same force and effect as a unanimous vote of the Directors. 2.11 Compensation. Duly elected or appointed Directors cha11 serve without compensation, but shall be reimbursed for costs of travel, meals, lodging and incidental expenses while on official business for the Corporation. 2.12 Reliance on Professionals and Experts. Directors are authorized to rely on information, opinions, reports and statements, including financial statements and other financial data, prepared or presented by others to the fullest extent permitted by applicable law. 2.13 Executive Committee. The Chairman of the Board may appoint an Executive Committee of the Board to handle the affairs of the Board when regular or special Board meetings are not in session, with such functions as may be designated to the Executive Committee by the Board through a resolution properly adopted. The Executive Committee may consist of the Chairman, Vice - Chairman, and one or two other Directors as designated by the Chairman. -3- MAY -29 -2001 09:43 (b) (c) (d) (f) (g) CITY OF ROUND ROCK 5122187097 P.09/22 ARTICLE 3. Officers • 2.14 Other Committees. The Chairman is authorized to form any committees as needed in order to assist the Board with its information gathering and deliberations, 2.15 Specific Powers and Duties. The Board, in addition to other powers and duties herein conferred, imposed, and authorized by law, shall have the following powers and duties: (a) It shall catty out all of the duties necessary for the proper operation and administration of the Corporation on behalf of the Members and to that end shall have all of the powers necessary and desirable for the effective administration of the affairs of the Corporation. It shall be authorized to contract with any qualified individual, firm or organization to perform any of the functions necessary for the effective administration or operation of the Corporation, or to provide for the fiscal protection of the Corporation or in keeping with its fiduciary responsibilities as Directors. It may hire attorneys, accountants, consultants, or such other professional persons that it may deem necessary aid to or for the Corporation. Those persons shall be paid as provided in the contract for hire as executed by the Chairman of the Board. It shall have the general power to make and enter into all contracts, leases and agreements necessary or convenient to carry out any of the powers granted under these bylaws or by any other law. (e) It shall provide for an annual audit of the books of the Corporation to be supplied to the Membership within 120 days following the close of each Corporation Year, or as soon thereafter as practicable. It shall have the authority to terminate membership of any Member that fails to abide by the reasonable requirements of the Board concerning payment of annual dues or aggregation fees as provided in Article 5, cooperate with any of the agents hired to provide administrative services on behalf of the Board, or takes any other action that may be detrimental to the Corporation. It may collect interest on all past due accounts not to exceed the amounts allowed under applicable law. 3.1 Generally. The Board shall elect from among their number a Chairman of the Board and a Vice - Chairman of the Board. The Board shall designate a Secretary, who may or may not be a Director, to keep the minutes and the records of the Board. The Board may appoint such other officers, assistant officers, committees and agents, including a treasurer, assistant secretaries and assistant treasurers, as they may consider necessary, who shall be chosen in such manner and hold their offices for such terms and have such authority and duties as may from time to time be determined by the Board. No person may simultaneously hold two offices. In all cases where the -4- MAY -29 -2001 09:43 CITY OF ROUND ROCK 5122187097 P.10/22 duties of any officer, agent or employee are not prescribed by the bylaws or by the Board, such officer, agent or employee shall follow the orders and instructions of the Chairman of the Board. 3.2 Election; Tenure. The Chairman of the Board, the Vice - Chairman, and the Secretary shall be elected at the organizational meeting of the Board. If the election of officers shall not be held at such meeting, such election shall be held as soon thereafter as a meeting may be conveniently convened. Other officers may be chosen by the Directors at such meeting or at any other tine. Each officer shall hold office until the first of the following occur: until his or her successor shall have been duly elected and shall have qualified; or until his or her death; or until he or she shall resign; or until he or she shall be disqualified pursuant to these bylaws; or until he or she shall have been removed in the manner hereinafter provided. 3.3 Removal Any officer or agent may be removed by majority vote of the entire Board for cause or without cause whenever in its judgment the best interests of the Corporation will be served thereby. Neither notice nor a hearing need be given to any officer or agent proposed to be so removed. Election or appointment of an officer or agent shall not in itself create contract rights. 3.4 Vacancies. A vacancy in any office, however occurring, may be filled by the Board for the unexpired portion of the term. 3.5 Powers and Duties of the Chief Executive Officer. The Chairman of the Board shall be the Chief Executive Officer of the Corporation. Subject to the control of the Board and the Executive Committee, the Chief Executive Officer shall have general executive charge, management and control of the properties, business and operations of the Corporation with all such powers as may be reasonably incident to such responsibilities; may agree upon and execute all leases, contracts, evidences of indebtedness and other obligations in the name of the Corporation; and shall have such other powers and duties as designated in accordance with these bylaws and as from time to time may be assigned to him or her by the Board. He or she shall preside at all meetings of the Members and of the Board. 3.6 Vice - Chairman. The Vice - Chairman shall assist the Chairman and shall perform such duties as may be assigned to him or her by the Chairman or by the Board. In the absence of the Chairman, the Vice- Chairman shall have the powers and perform the duties of the Chairman In addition, the Vice - Chairman shall have such other powers and duties as from time to time may be assigned to him or her by the Chairman or by the Board. 3.7 Secretary. The Secretary shrill- (a) keep the minutes of the proceedings of the Members, the Executive Committee and the Board; (b) see that all notices are duly given in accordance with the provisions of these bylaws or as required by law; (c) be custodian of the records and of the seal of the Corporation and affix the seal to all documents when authorized by the Board; (d) keep at the Corporation's principal place of business within the State of Texas a record containing the names and addresses of all Members; and (e) in general, perform all duties incident to the office of Secretary and such other duties as from time to tie may be assigned to him or her by the Chairman or by the Board. -5- MRY -29 -2001 09:43 CITY OF ROUND ROCK 5122187097 P.11 /22 3.8 Executive Director, Other Officers. The Board may select and appoint an Executive Director and any other employees to serve at the pleasure oldie Board. At the discretion of the Board, the Executive Director may be an independent contractor or an employee of the corporation. The Executive Director and any other such employees duly selected and appointed employees shall receive such compensation and other benefits as the Board may determine, and, additionally shall be entitled to reimbursement of expenses for attendance at official meetings of and official functions for the Corporation. ARTICLE 4. Membership 4.1 Eligibility. Any political subdivision of the State of Texas that approves the Articles of Incorporation and these Bylaws by ordinance, resohnion, or order adopted by the governing body of the political subdivision and that purchases electricity for one or more of their respective public facilities is eligible for membership in Governmental Aggregation Project, Inc., subject to the right of the Board to determine eligibility and conditions of membership, and subject further to the authority of the Board to terminate membership of any Member as provided herein, or in any agreement made between the Member and the Corporation. 4.2 Representation. Each Member shall appoint, by formal action by its governing body, a representative to act for it at the meetings of Members and shall give to the chair of the Board of Directors in writing the name of the person thus appointed. Only appointed representatives may act on behalf of Members in the conduct of business of the corporation. If at any time, a Member withdraws from participation or otherwise has its membership status terminated, that Member shall no longer have a representative in the Membership, on the Board, or on any committee of the Corporation. Each Representative will serve until a successor appointed. 4.3 WithdrawaL Any Member may withdraw from participation in the activities of the Corporation at any time upon thirty (30) days notice, whereupon it shall cease to be a Member, shall cease to be entitled or obligated to participate in the activities of all committees and subcommittees of the Board of Directors and shall have no further obligations as a Member; provided, however, that if such notice is given more than thirty (30) days after such Member's receipt of its statement of annual dues, fees and expenses for a fiscal year, the Member chill be obligated to pay for the full fiscal year within which such termination is effective. 4.4 Voting Rights. Voting rights are limited to Members. Each Member shall be entitled to use one vote at any regular or special meeting of the Members upon all matters of business, which vote or votes may be exercised in person or by mail by a representative of the Member duly authorized in writing; provided, however, that proxy and cumulative voting shall be prohibited. 4.5 Annual Meetings. The annual meeting of the Members shall be held at a time and on a date selected by the Chairman of the Board, with written notice to each Member, for the purpose of electing Directors, receiving the annual report from the Board, and for the transaction of such other business as may come before the meeting. lithe day fixed for the annual meeting shall be a -6- MRY -29 -2001 09:44 CITY OF ROUND ROCK 5122187097 P.12/22 legal holiday in the State of Texas, such meeting shall be held on the next succeeding business day. 4.6 Special Meetings. Special meetings of the Members, for any purpose, unless otherwise prescribed by statute, may be called by the Board, and shall be called by the Chairman of the Board or by the Secretary at the request of not less than one -tenth (1 /10) of all of the outstanding Members of the Corporation. 4.7 Place of Meeting. The Board may designate the place for any annual meeting or for any special meeting called by the Board. If no designation is made, or ifa special meeting shall be called otherwise than by the Board, the place of meeting shall be the principal office of the Corporation in Texas, 4.8 Notice of Meeting: Voting by Ballots Forwarded by Mail. (a) Written or printed notice stating the place, day and hour of the meeting, and, in case of a special meeting, the purposes for which the meeting is called, shall be delivered, not less than ten (10) nor more than fifty (50) days before the date of the meeting (either personally or by mail), by or at the direction of the Chairman of the Board or the Secretary to each Member entitled to vote at such meeting. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail so addressed, with postage thereon prepaid. In order that Members may vote by mail, each notice of meeting shall include a ballot containing each issue to be voted at that meeting and instructions as to the date by which such ballot must be postmarked in order for the vote to be counted. (b) Whenever notice is required in this Section 4.8 of Article 4, a waiver thereof in writing signed by the Member, whether before, at, or after the time stated therein, shall be equivalent to such notice. By attending a meeting, a Member waives objections to lack of notice or defective notice of such meeting unless the Member, at the beginning of the meeting, objects to the holding of the meeting or the transacting of business at the meeting. Further, a Member waives objection to consideration at such meeting of a particular matter not within the purpose or purposes described in the meeting notice unless the Member objects to considering the matter when it is presented. 4.9 Quorum. A quorum for the election of Directors, and conducting normal business at all meetings of the Members shall be twenty-five percent of the Members present in person or voting by mail 4.10 Informal Action by Members. Any action required to be taken at a meeting of the Members, or any other action which may be taken at a meeting of the Members, may be taken without a meeting ifa consent or consents in writing, setting forth the action so taken, shall be signed by all of the Members with respect to the subject matter thereof Such consent or consents shall have the same force and effect as a unanimous vote of the Members. ARTICLE 5. Funding -7- MRY -29 -2001 09:44 CITY OF ROUND ROCK ARTICLE 6. Indemnification 5122187097 P.13/22 i 5.1 Generally. Funding of the corporation shall be by member political subdivisions through the assessment of dues or through an aggregation fee charged per kilowatt - hour, or a combination of both as determined appropriate by the Board of Directors. 5.2 Initial Membership Fee. The initial membership fee shall be $1,000.00, however no Member shall be required to pay such fee until there are five (5) or more Members. Such fee shall reimburse all Board approved costs incurred in the initial creation and organizational meeting administering the corporation, not to exceed $10,000.00. To the extent all costs have been reimbursed, any funds remaining shall be a credit as to future aggregation fees. 5.3 Board Authority. The Board shall have the authority to establish membership dues, an aggregation fee, or both, to be applicable to all Members of the Corporation based upon a projected budget as approved by the Board, the draft of which has been provided to the Members at least seven (7) days before the Board meets to vote on such budget. Such draft may be provided by fax or e-mail message to the Members. The budget, as adopted, shall be substantially sitrular to the draft as provided to the Members, without an overall change of greater than 15 %. The Board may amend such dues and fees only after notice to all Members, based upon a revised and approved budget. The Board shall have the authority to establish appropriate penalties that may be 'assessed against a Member for failure to pay the dues, aggregation fee, or both, established by the Board. 5.4 Statements. Membership fees will be billed annually (other than the Initial Membership Fee); statements for other fees and expenses will be provided monthly as needed. Due dates for fees and expenses will be determined by the Board. 5.5 Books and Records. All Members of the corporation will have access to the books and records of the corporation, including financial statements and budgets; however, the Board of Directors may adopt policies that provide reasonable protection against the unnecessary disclosure of information to individual employees. 6.1 Liability. A Director, officer, employee or agent of the Corporation who performs his or her duties in good faith, in a manner he or she reasonably believes to be in the best interests of the Corporation, and with such care as an ordinarily prudent person in a like position would use under similar circumstances, shall not have any liability by reason of being or having been a Director, officer, employee or agent of the Corporation and shall not have any liability for any action taken by any employee, agent or independent contractor selected with reasonable care, or for any loss incurred through the investment of or failure to invest monies of the Corporation or any Trust Account. No Director, officer, employee or agent shall be liable for any action taken or omitted by another Director, officer, employee or agent. 6.2 INDEMNIFICATION. EACH PERSON WHO AT ANY TIME SHALL SERVE, OR SHALL HAVE SERVED, AS A DIRECTOR, OFFICER, EMPLOYEE OR AGENT OF THE CORPORATION, OR ANY PERSON WHO, WHILE A DIRECTOR, OFFICER, EMPLOYEE -8- MAY-29-2001 09:45 CITY OF ROUND ROCK 5122187097 P.14/22 OR AGENT OF THE CORPORATION, IS OR WAS SERVING AT ITS REQUEST AS A DIRECTOR, OFFICER, PARTNER, VENTURER, PROPRIETOR, TRUSTEE, EMPLOYEE, AGENT OR SIMILAR FUNCTIONARY OF ANOTHER FOREIGN OR DOMESTIC CORPORATION, PARTNERSHIP, JOINT VENTURE, SOLE PROPRIETORSHIP, TRUST EMPLOYEE BENEFIT PLAN OR OTHER ENTERPRISE, SHALL BE ENTITLED TO INDEMNIFICATION AS, AND TO THE FULLEST EXTENT, PERMITTED BY ARTICLE 1396 2.22A OF THE TEXAS NON PROFIT CORPORATION ACT OR ANY SUCCESSOR STATUTORY PROVISION, AS FROM TIME TO TIME AMENDED, SUCH ARTICLE OR SUCCESSOR PROVISION, AS SO AMENDED, BEING INCORPORATED IN FULL IN THESE BYLAWS BY REFERENCE. THE FOREGOING RIGHT OF INDEMNIFICATION SHALL NOT BE DEEMED EXCLUSIVE OF ANY OTHER RIGHTS TO WHICH THOSE TO BE INDEMNIFIED MAY BE ENTITLED AS A MATTER OF LAW OR UNDER ANY AGREEMENT, VOTE OF DISINTERESTED DIRECTORS, OR OTHER ARRANGEMENT. IT IS EXPRESSLY ACKNOWLEDGED THAT THE INDEMNIFICATION PROVIDED IN THIS ARTICLE COULD INVOLVE INDEMNIFICATION FOR NEGLIGENCE OR UNDER THEORIES OF STRICT LIABILITY. 6.3 Advance Payment. The right to indemnification conferred in this Article W shall include the right to be paid in advance or reimbursed by the Corporation the reasonable expenses incurred by a person of the type entitled to be indemnified under Section 2 who was, is or is threatened to be made a named defendant or respondent in a proceeding in advance of the final disposition of the proceeding and without any determination as the person's ultimate entitlement to indemnification; provided, however, that the payment of such expenses incurred by any such person in advance of the final disposition of a proceeding, shall be made only upon delivery to the Corporation of a written affirmation by such Director or officer of his or her good faith belief that he or she has met the standard of conduct necessary for indemnification under this Article 6 and a written undertaking, by or on behalf of such person, to repay all amounts so advanced if it shall ultimately be determined that such indemnified person is not entitled to be indemnified under this Article 6 or otherwise. 6.4 Appearance as a Witness. Notwithstanding any other provision of this Article 6, the Corporation may pay or reimburse expenses incurred by a Director or officer in connection with his or her appearance as a witness or other participation in a proceeding involving the Corporation or its business at a time when he or she is not a named defendant or respondent in the proceeding. 6.5 Non-Exclusivity of Rights. The right to indemnification and the advancement and payment of expenses conferred in this Article 6 shall not be exclusive of any other right which a Director or officer or other person indemnified pursuant to this Article 6 may have or hereafter acquire under any law (common or statutory), provision of the Articles of Incorporation of the Corporation or these Bylaws, agreement, vote of shareholders or disinterested Directors or otherwise. 6.6 Savings Claa e. If this Article 6 or any portion hereof shall be invalidated on any MAY -29 -2001 09:45 CITY OF ROUND ROCK 5122187097 P.15/22 ground by any court of competent jurisdiction, then the Corporation shall nevertheless indemnify and hold harmless each Director,1 officer or any other person indemnified pursuant to this Article VI as to costs, charges and expenses (including attorneys' fees), judgments, fines and in amounts paid in settlement with respect to any action, suit or proceeding, whether civil, criminal, administrative or investigative, to the full extent permitted by any applicable portion of this Article VI that shall not have been invalidated and to the fullest extent permitted by applicable law. ARTICLE 7. Code of Conduct 7.1 Policy and Purposes. (a) • It is the policy of the Corporation that Directors and officers conduct themselves in a manner consistent with sound business and ethical practices; that the public interest always be considered in conducting corporate business; that the appearance of impropriety be avoided to ensure and maintain public confidence in the Corporation; and that the Board establish policies to control and manage the affairs of the Corporation fairly, impartially, and without discrimination. (b) This Code of Ethics has been adopted as part of the Corporation's Bylaws for the following purposes: (a) to encourage high ethical standards in official conduct by Directors and corporate officers; and (b) to establish guidelines for such ethical standards of conduct. 7.2 Conflicts of Interest. (a) Except as provided in subsection (c), a Director or officer is prohibited from participating in a vote, decision, or award of a contract involving a business entity or real property in which the Director or the officer has a substantial interest, if it is foreseeable that the business entity or real property will be economically benefitted by the action. A person has a substantial interest in a business (i) if his or her ownership interest is ten percent or more of the voting stock or shares of the business entity or ownership of $15,000 or more of the fair market value of the business entity, or (ii) if the business entity provides more than ten percent of the person's gross income. A person has a substantial interest in real property if the interest is an equitable or legal ownership with a fair market value of $2,500 or more. An interest of a person related in the first degree by affinity (marriage relationship) or consanguinity (blood relationship) to a Director or officer is considered a substantial interest. (b) If a Director or a person related to a Director in the first degree by affinity or the first degree by consanguinity has a substantial interest in a business entity or real property that would be pecuniarily affected by any official action taken by the Board, such Director, before a vote or decision on the matter, shall file an affidavit stating the nature and extent of the interest. The affidavit shall be filed with the Secretary of the Board. (c) A Director who has a substantial interest in a business entity that will receive a pecuniary benefit from an action of the Board may vote on that action if a majority of the Board has a similar interest is the same action or Wall other similar business entities in the Corporation wID receive a pecuniary benefit. (d) An employee of a public entity may serve on the Board.7.3 Acceptance of Gifts. No Director or officer shall accept any benefit as consideration for any decision, opinion, -10- MRY -29 -2001 09:46 (d) CITY OF ROUND ROCK 5122187097 P.16/22 recommendation, vote or other exercise of discretion in carrying out official acts for the Corporation. No Director or officer shall solicit, accept, or agree to accept any benefit from a person known to be interested in or likely to become interested in any contract, purchase, payment, claim or transaction involving the exercise of the Director's or officer's discretion. As used here, a benefit does not include: (a) a fee prescribed by law to be received by a Director or officer or any other benefit to which the Director or officer is lawfully entitled or for which he or she gives legitimate consideration in a capacity other than as a Director or officer, (b) a gift or other benefit conferred on account of kinship or a personal, professional or business relationship independent of the official status of the Director or officer; (c) an honorarium in consideration for legitimate services rendered above and beyond official duties and responsibilities if (1) not more than one honorarium is received from the same person in a calendar year, (2) not more than one honorarium is received for the same service; and (3) the value of the honorarium does not exceed $50 exclusive of reimbursement for travel, food, and lodging expenses incurred by the Director or officer in performance of the services; • a benefit c of f ood, lodging, transportation, or entertainment accepted as a guest if reported as may be required by law. • 7.4 Bribery. A Director or officer shall not intentionally or knowingly offer, confer or agree to confer on another, or solicit, accept, or agree to accept from another: (a) any benefit as consideration for the Director's or officer's decision, opinion, recommendation, vote, or :other exercise of discretion as a Director or officer; (b) any benefit as consideration for the Director or officer's decision, vote, recommendation, or otherexercise of official discretion in a judicial or administrative proceeding; or (c) any benefit as consideration for a violation of duty imposed by law on the Director or officer. 7.5 Notice. No Director or officer shall appoint, or vote for, or confirm the appointment to any office, position, clerkship, employment or duty, of an person related within the second degree by affinity or within the third degree of consanguinity to the Director or officer so appointing, voting or confirming, or to any other Director or officer. This provision shall not prevent the appointment, voting for, or confirmation of any person who shall have been -11- MRY -29 -2001 09:46 11 1 4 0 910 0011BYLA W SGO VO Lwpd CITY OF ROUND ROCK 5122187097 P.17/22 continuously employed in any such office, position, clerkship, employment or duty at least thirty (30) days prior to the appointment of the Director or officer so appointing or voting. ARTICLE 8. Miscellaneous Provisions 8.1 Fiscal Year. The fiscal year for the Corporation shall begin on and end on . This fiscal year shall also be referred to as the Corporation Year. 8.2 Seal The seal of the Corporation shall be such as from time to time may be approved by the Board. 8.3 Gender. References herein to the masculine gender shall also refer to the feminine in all appropriate cases, and vice versa 8.4 Appropriations and Grants. The Corporation clwll have the power to request and accept any appropriation, grant, contrlhution, donation, or other form of aid from the federal government, the State, any political subdivision, or municipality in the State, or from any other source. 8.5 Amendments. These bylaws may be amended by the Board after notice of the proposed amendments has been mailed to each Director of the Board at least ten (10) days prior to the day of the meeting to consider same. The Board shall recommend such changes as it deems necessary or desirable from time to time. Any amended Bylaws shall be signed by the Chairman and attested to by the Secretary. A copy of any amendment shall be mailed immediately after its adoption to each Member. 8.6 Conflicts of Interest. Each Director, committee member and subcommittee member shall have an affirmative duty to disclose to the Board of Directors, the committee or subcommittee (as the case may be) any actual or potential conflicts of interest between such Director, committee member or subcommittee member, and the Corporation where, and to the extent that, such conflicts or potential conflicts directly or indirectly affect any matter that comes before the Board of Directors, or any committee or subcommittee. -12- DATE: June 8, 2001 SUBJECT: City Council Meeting — June 14, 2001 ITEM: 16.A.1. Consider a resolution approving the Articles of Incorporation and Bylaws of the Governmental Aggregation Project, Inc., and accepting membership in said corporation. The resolution enables the City's participation in a political subdivision corporation that will act as an agent to negotiate the purchase of electricity for City facilities. Resource: Bob Bennett, City Manager David Kautz, Finance Director History: Electric deregulation in Texas is currently scheduled to occur on January 1, 2002. At that time the City will no longer deal with TXU as we know it for electrical power. We will purchase electricity from Retail Electric Providers (REPs). Under the electric restructuring law passed during the 1999 Texas legislative session, cities and other political subdivisions may create entities, called political subdivision corporations, to aggregate (combine) electric loads and contract for the purchase of electric power from REPs in the soon- to -be- deregulated retail electric market. Public Comment: N/A Sponsor: N/A Aggregation is a method by which cities and other political subdivisions may work together to achieve maximum price advantage by maximizing their aggregated electric load requirements. Funding: Cost: Initial Membership Fee is $1,000; additional costs will be established by the Corporation Board and will be paid as annual dues or fees by members of the corporation or in the cost of electricity. Source of Funds: Operating funds Outside Resources: CCG Consulting, Inc. (Consultant to the Corporation) Impact/Benefit: Participation in an aggregation group enables the City to increase its options for achieving the best electric power package. At this point, the City is not contracting for electric power but is participating in the bid process with the aggregation group. Selection of a Retail Electric Provider (REP) will be done later in the year (probably October). At that time, the City may stay with the aggregation group and its REP or contract with an REP on its own. 1 El'ectricAggregation Bulletin Volume 1, Number 3 GAP Meeting. The Government Aggregation Project (GAP) has been incorporated by the cities of Missouri City, Rosenberg and Wharton. The GAP is taking a balanced approach to achieving long -term energy and financial savings, by analyzing each member's energy usage history, aggregating their needs with those of compatible agencies, and managing individual and group electric loads, on an ongoing basis. While the GAP will not be the largest volume aggregation group at the opening of the deregulated market in Texas, it is our view that volume alone will not insure the best bids. The GAP will offer services and benefits that will increase the membership steadily over time. Please call Paul S, at 512- 231 -8400 for additional information. Read Your Contract CAREFULLY. It may seem easier to have a competitive supplier's agent explain their service contract, than to work with an independent expert, however, these agreements are generally complex, and customers should pay careful attention to the clauses dealing with termination for cause, termination for convenience, and force majeure, to ensure that their interests are fully protected. By so doing, the customer can avoid future supply problems, and legal costs. Here is a case in point: A competitive retail electric provider (REP), active in both California and Texas, was recently sued by two major customers in California, who allege that the REP defaulted on supply contracts with them so that it could sell their power for more money elsewhere. After a federal judge ordered the REP to restore service to the customers, the REP filed an appeal for an emergency stay. The REP claimed entitlement as a publicly traded company to further its own economic interest by returning the customers to regular utility service. The customers are both in the final year of four -year, fixed -price contracts that obligate the REP to sell power to them for 5% less than the price cap set in the 1996 California deregulation law. The REP dropped the customers on February 1, 2001 and shifted them back to financially troubled Pacific Gas & Electric and Southem California Edison. While the State of California buys wholesale power at a loss to serve these customers, the REP has sold their power on the spot market, at much higher prices. The REP is making the customers whole by ensuring their 5% cost reduction for the remainder of the term of their contracts, claiming that this satisfies their obligations. The customers claim that the REP's actions expose them to risk of blackouts and could greatly increase their future power costs. Texas Retail Choice Pilot Update. The Public Utility Commission has released a price comparison as shown on the Electricity Facts Label provided by various REPs during the Pilot Program. The price per kWh in the TXU service territory ranges from a low of 8.020 for 1500 kWh to 10.0¢. TXU's April price is 8.67¢. In Reliant's services territory the price per kWh ranges from 9.5¢ to 10.130 for 1500 kWh, while Reliant's April price is 10.330. The contract terms vary widely in both service territories. CCG Energy Solutions is conducting a research project for electric utilities with Xenergy/Kema Consulting, Cambridge, MA. The project will provide information for utilities CCG's mission is to provide traditional and cutting edge solutions that support the long -term success of our clients in the competitive energy and telecommunications environment. that are considering providing competitive telecommunications services. CCG will continue to partner with Xenergy where it makes sense for our current clients. Successful Energy Management. We at CCG Energy Solutions encourage our clients to recognize electric deregulation as an opportunity to benefit from new value -added services and products from competitive suppliers. We recognize that the benefits from deregulation will increase over time if agencies begin to carefully monitor their energy usage and costs, and take cost - effective steps to reduce consumption and manage loads. The three main aspects of a successful long - term energy strategy are: Analysis — The most important criterion for success is understanding your current situation. CCG conducts strategic reviews of utility accounts to identify competitive opportunities for our clients. We also audit and evaluate the condition of facilities and operations, to identify productive opportunities for reducing costs. — Joining with other complementary agencies can help a customer to satisfy utility needs and access value -added services at lower cost. CCG assists its customers by conducting gap analyses of existing operations, recommending vendors to provide products and services, and performing Cost/Benefit analyses to determine the optimum choice. — Competitive benefits must be managed over the long term. CCG performs contract compliance audits, and assists its clients to develop competitive business processes. We can help you to develop and finance an energy conservation or load management project, and set up a program to verify the cost savings. We can also manage the strategic outsourcing of operations and maintenance service, and other service functions. Update Your LoanSTAR Audit. In 1992 -93, the Governor's Energy Office offered the LoanSTAR audit program to political subdivisions in Texas. Funded using Oil Overcharge monies. LoanSTAR provided free energy audits and reimbursement for the implementation of recommended conservation projects in the facilities of over 100 cities, counties, and school districts. Despite the documented potential for cost - effective savings -a project's Simple Payback had to be less than 4 years, many public agencies that received the free audit declined to implement their energy conservation projects, due to restricted internal funding. CCG Energy Solutions can assist participants in the original LoanSTAR program to update their audit reports, and implement cost - effective energy management projects. Our team will review the existing report and adjust the findings to account for new facilities and changes in energy cost. We can assist with the bid and construction processes, and verify savings. CCG's Energy Solutions WWW Site. Please go to http: / /www.c- c- g.com/ to access the site. We will archive bulletins, presentations, frequently asked questions as well as links to other sites that relate to specific projects. CCG's mission is to provide traditional and cutting edge solutions that support the long - term success of our clients in the competitive energy and telecommunications environment RESOLUTION NO. A RESOLUTION APPROVING THE ARTICLES OF INCORPORATION AND BYLAWS OF GOVERNMENTAL AGGREGATION PROJECT, INC., A POLITICAL - SUBDIVISION CORPORATION; ACCEPTING MEMBERSHIP IN SAID CORPORATION; APPOINTING A REPRESENTATIVE TO SERVE ON BEHALF OF [IDENTIFY ENTITY]; APPROVING PAYMENT OF AN INITIAL MEMBERSHIP FEE; AND ESTABLISHING AN EFFECTIVE DATE. WHEREAS, Chapter 303 of the Texas Local Government Code, entitled "Energy Aggregation Measures for Local Governments," allows political subdivisions to form a political subdivision corporation to act as an agent to negotiate the purchase of electricity, or to likewise aid or act on behalf of the political subdivisions for which the corporation is created, with respect to their own electricity use for their respective public facilities; and WHEREAS, Govemmental Aggregation Project, Inc. ( "GAP ") is a political subdivision corporation organized under said Chapter; and WHEREAS, the negotiation for electricity by the corporation should result in lower electricity costs to [IDENTIFY ENTITY]; and WHEREAS, the [IDENTIFY ENTITY] seeks to become a Member of GAP; and WHEREAS, the By -Laws of GAP require an initial membership fee of $1,000.00; NOW THEREFORE, BE IT RESOLVED BY THE [IDENTIFY THE GOVERNING BODY] OF [IDENTIFY ENTITY]: Section 1. The recitals contained in the preamble of this Resolution are determined to be true and correct and are hereby adopted as a part of this Resolution. Section 2. The Articles of Incorporation and Bylaws of GAP, a political subdivision corporation, attached hereto and incorporated herein for all purposes as Exhibits A and B respectively, are hereby approved. Section 3. [IDENTIFY ENTITY] accepts Membership in GAP. Section 4. [IDENTIFY ENTITY] approves payment of an initial membership fee of $1,000.00 in accordance with Article 5 of the Bylaws. Section 5. [IDENTIFY ENTITY] hereby appoints [IDENTIFY ONE POSITION, ie. -t- below, which shall require thirty (30) days' prior notice. From the nominations so made and no others, and from the slate presented by the Board, Directors shall be elected, and the person or persons receiving the highest number of votes shall be declared elected. If the election of Directors shall not be held on the day designated herein for any annual meeting of the Members, or at any adjournment thereof, the Board shall cause the election to be held at a special meeting of the Members, which shall be convened as soon thereafter as is possible. (b) The initial Board of Directors shall consist of three directors, as designated, in Article Seven of the Articles of Incorporation ( "Initial Board "). Such Initial Board shall serve until their successors are duly elected and qualified. On or before December 31, 2001, the Members shall elect from its Members an elected Board, with the number of elected Board Members, as determined by the Initial Board by September 1, 2001. The number of Directors may be increased or decreased by resolution of the Board, but no decrease shall have the effect of shortening the term of an incumbent Director. (c) The first elected Directors shall serve until December 31, 2003. The subsequent Board Member Selection Process will be determined by the first elected Board based upon an equitable and fair manner that allows all Members to have representation and must be established before June 1, 2003. The directors elected as a result of using the subsequent Board Member Selection Process shall serve two (2) year staggered terms with directors serving in place numbers that are odd elected in odd numbered years and those serving in place numbers that are even elected in even numbered years. (d) Except for the Initial Board, each Director of the Board must be an official or full time salaried employee of a Member. Any Director who is an official or full-time salaried employee of an entity that ceases to be a Member participant of the Corporation, and any Director who ceases to be an official or full -time salaried employee of a Member, shall be automatically disqualified to serve as a Director, and the position shall become vacant, such vacancy to be filled in the manner provided in Section 2.5 of this Article 2. 2.4 Removal. D may be removed from office, with or without cause, by an affirmative vote of the majority of the Members then entitled to vote at an election of the Directors at an annual meeting of the Members or a in meeting called expressly for that purpose; provided, no action to remove any Director shall be sufficient unless written notice that such action is to be considered shall have been given to all Members by the Chairman or Secretary at least sixty (60) days before the meeting. 2.5 Vacancies. Any Director may resign at any time by giving written notice to the Secretary of the Corporation. Such resignation shall take effect at the time specified therein; and, unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective. Any vacancy occurring in the Board may be filled by the affirmative vote of a majority of the remaining Directors though less than a quorum. A Director elected to fill a vacancy shall be elected for the unexpired term of his or her predecessor in office. Any place on the Board to be filled by reason of an increase in the number of Directors shall be filled by the affirmative vote of a majority of the Directors then in office. A Director chosen to fill a position resulting from an increase in the number of Directors shall hold office until the next annual meeting of -2- Members, at which time a successor shall be elected to serve until the expiration date set for his or her designated place. 2.6 Regular Meetings. A regular meeting of the Board shall be held annually in conjunction with the annual meeting of Members, for the purpose of organization, election of officers, and consideration of any other business that properly may come before the Board. The Board may provide, by resolution, the time and place for the holding of additional regular meetings. 2.7 Special Meetings. Special meetings of the Board may be called by the Chairman of the Board or at the written request of any two Directors. The person or persons authorized to call special meetings of the Board may fix the place for holding any special meeting of the Board so called. If no place is fixed, the place of meeting shall be the principal office of the Corporation in Texas. 2.8 Voting, Quorums. A majority of the number of D described in by Section 2.3 shall constitute a quorum for the transaction of business. The act of the majority of the Directors present at a meeting at which a quorum is present shall be the act of the Board, provided, however, the Board may, by resolution, delegate any of its powers in whole or in part, temporarily or permanently, to any Director or committee of Directors then acting; any such delegation shall be by written instrument filed in the records of the Corporation. 2.9 Notice of Meetings. Notice for board meetings shall be provided to all Directors and Members either by mail not less than seventy-two (72) hours before the date of the meeting, by telephone, telegram, e-mail or telecopy on twenty-four (24) hours notice or on such shorter notice as the person or persons calling such meeting may deem necessary or appropriate in the circumstances. 2.10 Informal Action by Directors. Any action required to be taken at a meeting of the Directors, or any other action which may be taken at a meeting of the Directors, may be taken without a meeting if a consent or consensus in writing, setting forth the action so taken, shall be signed by all of the Members with respect to the subject matter thereof. Such consent or consents shall have the same force and effect as a unanimous vote of the Directors. 2.11 Compensation. Duly elected or appointed Directors shall serve without compensation, but shall be reimbursed for costs of travel, meals, lodging and incidental expenses while on official business for the Corporation. 2.12 Reliance on Professionals and Experts. Directors are authorized to rely on information, opinions, reports and statements, including financial statements and other financial data, prepared or presented by others to the fullest extent permitted by applicable law. 2.13 Executive Committee. The Chairman of the Board may appoint an Executive Committee of the Board to handle the affairs of the Board when regular or special Board meetings are not in session, with such functions as may be designated to the Executive Committee by the Board through a resolution properly adopted. The Executive Committee may consist of the Chairman, Vice - Chairman, and one or two other Directors as designated by the Chairman. 2.14 Other Committees. The Chairman is authorized to form any committees as needed in order to assist the Board with its information gathering and deliberations. 2.15 Specific Powers and Duties. The Board, in addition to other powers and duties herein conferred, imposed, and authorized by law, shall have the following powers and duties: (a) It shall carry out all of the duties necessary for the proper operation and administration of the Corporation on behalf of the Members and to that end shall have all of the powers necessary and desirable for the effective administration of the affairs of the Corporation. (b) (g) It shall be authorized to contract with any qualified individual, firm or organization to perform any of the functions necessary for the effective administration or operation of the Corporation, or to provide for the fiscal protection of the Corporation or in keeping with its fiduciary responsibilities as Directors. (c) It may hire attorneys, accountants, consultants, or such other professional persons that it may deem necessary aid to or for the Corporation. Those persons shall be paid as provided in the contract for hire as executed by the Chairman of the Board. (d) It shall have the general power to make and enter into all contracts, leases and agreements necessary or convenient to carry out any of the powers granted under these bylaws or by any other law. (e) It shall provide for an annual audit of the books of the Corporation to be supplied to the Membership within 120 days following the close of each Corporation Year, or as soon thereafter as practicable. (f) It shall have the authority to terminate membership of any Member that fails to abide by the reasonable requirements of the Board concerning payment of annual dues or aggregation fees as provided in Article 5, cooperate with any of the agents hired to provide administrative services on behalf of the Board, or takes any other action that may be detrimental to the Corporation. It may collect interest on all past due accounts not to exceed the amounts allowed under applicable law. ARTICLE 3. Officers 3.1 Generally. The Board shall elect from among their number a Chairman of the Board and a Vice - Chairman of the Board. The Board shall designate a Secretary, who may or may not be a Director, to keep the minutes and the records of the Board. The Board may appoint such other officers, assistant officers, committees and agents, including a treasurer, assistant secretaries and assistant treasurers, as they may consider necessary, who shall be chosen in such manner and hold their offices for such terms and have such authority and duties as may from time to time be determined by the Board. No person may simultaneously hold two offices. In all cases where the -4- duties of any officer, agent or employee are not prescribed by the bylaws or by the Board, such officer, agent or employee shall follow the orders and instructions of the Chairman of the Board. 3.2 Election; Tenure. The Chairman of the Board, the Vice - Chairman, and the Secretary shall be elected at the organizational meeting of the Board. If the election of officers chat( not be held at such meeting, such election shall be held as soon thereafter as a meeting may be conveniently convened. Other officers may be chosen by the Directors at such meeting or at any other time. Each officer shall hold office until the first of the following occur: until his or her successor shall have been duly elected and shall have qualified; or until his or her death; or until he or she shall resign; or until he or she shall be disqualified pursuant to these bylaws; or until he or she shall have been removed in the manner hereinafter provided. 3.3 Removal. Any officer or agent may be removed by majority vote of the entire Board for cause or without cause whenever in its judgment the best interests of the Corporation will be served thereby. Neither notice nor a hearing need be given to any officer or agent proposed to be so removed. Election or appointment of an officer or agent shall not in itself create contract rights. 3.4 Vacancies. A vacancy in any office, however occurring, may be filled by the Board for the unexpired portion of the term. 3.5 Powers and Duties of the Chief Executive Officer. The Chairman of the Board shall be the Chief Executive Officer of the Corporation. Subject to the control of the Board and the Executive Committee, the Chief Executive Officer shall have general executive charge, management and control of the properties, business and operations of the Corporation with all such powers as may be reasonably incident to such responsibilities; may agree upon and execute all leases, contracts, evidences of indebtedness and other obligations in the name of the Corporation; and shall have such other powers and duties as designated in accordance with these bylaws and as from time to time may be assigned to him or her by the Board. He or she shall preside at all meetings of the Members and of the Board. 3.6 Vice - Chairman. The Vice - Chairman shall assist the Chairman and shall perform such duties as may be assigned to him or her by the Chairman or by the Board. In the absence of the Chairman, the Vice - Chairman shall have the powers and perform the duties of the Chairman. In addition, the Vice- Chairman shall have such other powers and duties as from time to time may be assigned to him or her by the Chairman or by the Board. 3.7 Secretary. The Secretary shall: (a) keep the minutes of the proceedings of the Members, the Executive Committee and the Board; (b) see that all notices are duly given in accordance with the provisions of these bylaws or as required by law; (c) be custodian of the records and of the seal of the Corporation and affix the seal to all documents when authorized by the Board; (d) keep at the Corporation's principal place of business within the State of Texas a record containing the names and addresses of all Members; and (e) in general, perform all duties incident to the office of Secretary and such other duties as from time to tie may be assigned to him or her by the Chairman or by the Board. -5- 3.8 Executive Director, Other Officers. The Board may select and appoint an Executive Director and any other employees to serve at the pleasure of the Board. At the discretion of the Board, the Executive Director may be an independent contractor or an employee of the corporation. The Executive Director and any other such employees duly selected and appointed employees shall receive such compensation and other benefits as the Board may determine, and, additionally shall be entitled to reimbursement of expenses for attendance at official meetings of and official functions for the Corporation. ARTICLE 4. Membership 4.1 Eligibility. Any political subdivision of the State of Texas that approves the Articles of Incorporation and these Bylaws by ordinance, resolution, or order adopted by the governing body of the political subdivision and that purchases electricity for one or more of their respective public facilities is eligible for membership in Governmental Aggregation Project, Inc., subject to the right of the Board to determine eligibility and conditions of membership, and subject further to the authority of the Board to terminate membership of any Member as provided herein, or in any agreement made between the Member and the Corporation. 4.2 Representation. Each Member shall appoint, by formal action by its governing body, a representative to act for it at the meetings of Members and shall give to the chair of the Board of Directors in writing the name of the person thus appointed. Only appointed representatives may act on behalf of Members in the conduct of business of the corporation. If at any time, a Member withdraws from participation or otherwise has its membership status terminated, that Member shall no longer have a representative in the Membership, on the Board, or on any committee of the Corporation. Each Representative will serve until a successor appointed. 4.3 Withdrawal. Any Member may withdraw from participation in the activities of the Corporation at any time upon thirty (30) days notice, whereupon it shall cease to be a Member, shall cease to be entitled or obligated to participate in the activities of all committees and subcommittees of the Board of Directors and shall have no further obligations as a Member; provided, however, that if such notice is given more than thirty (30) days after such Member's receipt of its statement of annual dues, fees and expenses for a fiscal year, the Member shall be obligated to pay for the full fiscal year within which such termination is effective. 4.4 Voting Rights. Voting rights are limited to Members. Each Member shall be entitled to use one vote at any regular or special meeting of the Members upon all matters of business, which vote or votes may be exercised in person or by mail by a representative of the Member duly authorized in writing; provided, however, that proxy and cumulative voting shall be prohibited. 4.5 Annual Meetings. The annual meeting of the Members shall be held at a time and on a date selected by the Chairman of the Board, with written notice to each Member, for the purpose of electing Directors, receiving the annual report from the Board, and for the transaction of such other business as may come before the meeting. If the day fixed for the annual meeting shall be a -6- legal holiday in the State of Texas, such meeting shall be held on the next succeeding business day. 4.6 Special Meetings. Special meetings of the Members, for any purpose, unless otherwise prescribed by statute, may be called by the Board, and shall be called by the Chairman of the Board or by the Secretary at the request of not less than one -tenth (1 /10) of all of the outstanding Members of the Corporation. 4.7 Place of Meeting. The Board may designate the place for any annual meeting or for any special meeting called by the Board. If no designation is made, or if a special meeting shall be called otherwise than by the Board, the place of meeting shall be the principal office of the Corporation in Texas. 4.8 Notice of Meeting: Voting by Ballots Forwarded by Mail. (a) Written or printed notice stating the place, day and hour of the meeting, and, in case of a special meeting, the purposes for which the meeting is called, shall be delivered, not less than ten (10) nor more than fifty (50) days before the date of the meeting (either personally or by mail), by or at the direction of the Chairman of the Board or the Secretary to each Member entitled to vote at such meeting. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail so addressed, with postage thereon prepaid. In order that Members may vote by mail, each notice of meeting shall include a ballot containing each issue to be voted at that meeting and instructions as to the date by which such ballot must be postmarked in order for the vote to be counted. (b) Whenever notice is required in this Section 4.8 of Article 4, a waiver thereof in writing signed by the Member, whether before, at, or after the time stated therein, shall be equivalent to such notice. By attending a meeting, a Member waives objections to lack of notice or defective notice of such meeting unless the Member, at the beginning of the meeting, objects to the holding of the meeting or the transacting of business at the meeting. Further, a Member waives objection to consideration at such meeting of a particular matter not within the purpose or purposes described in the meeting notice unless the Member objects to considering the matter when it is presented. 4.9 Quorum. A quorum for the election of Directors, and conducting normal business at all meetings of the Members shall be twenty -five percent of the Members present in person or voting by mail. 4.10 Informal Action by Members. Any action required to be taken at a meeting of the Members, or any other action which may be taken at a meeting of the Members, may be taken without a meeting if a consent or consents in writing, setting forth the action so taken, shall be signed by all of the Members with respect to the subject matter thereof. Such consent or consents shall have the same force and effect as a unanimous vote of the Members. ARTICLE 5. Funding -7- 5.1 Generally. Funding of the corporation shall be by member political subdivisions through the assessment of dues or through an aggregation fee charged per kilowatt -hour, or a combination of both as determined appropriate by the Board of Directors. 5.2 Initial Membership Fee. The initial membership fee shall be $1,000.00, however no Member shall be required to pay such fee until there are five (5) or more Members. Such fee shall reimburse all Board approved costs incurred in the initial creation and organizational meeting administering the corporation, not to exceed $10,000.00. To the extent all costs have been reimbursed, any funds remaining shall be a credit as to future aggregation fees. 5.3 Board Authority. The Board shall have the authority to establish membership dues, an aggregation fee, or both, to be applicable to all Members of the Corporation based upon a projected budget as approved by the Board, the draft of which has been provided to the Members at least seven (7) days before the Board meets to vote on such budget. Such draft may be provided by fax or e-mail message to the Members. The budget, as adopted, shall be substantially similar to the draft as provided to the Members, without an overall change of greater than 15 %. The Board may amend such dues and fees only after notice to all Members, based upon a revised and approved budget. The Board shall have the authority to establish appropriate penalties that may be assessed against a Member for failure to pay the dues, aggregation fee, or both, established by the Board. 5.4 Statements. Membership fees will be billed annually (other than the Initial Membership Fee); statements for other fees and expenses will be provided monthly as needed. Due dates for fees and expenses will be determined by the Board. 5.5 Books and Records. All Members of the corporation will have access to the books and records of the corporation, including financial statements and budgets; however, the Board of Directors may adopt policies that provide reasonable protection against the unnecessary disclosure of information to individual employees. ARTICLE 6. Indemnification 6.1 Liability. A Director, officer, employee or agent of the Corporation who performs his or her duties in good faith, in a manner he or she reasonably believes to be in the best interests of the Corporation, and with such care as an ordinarily prudent person in a like position would use under similar circumstances, shall not have any liability by reason of being or having been a Director, officer, employee or agent of the Corporation and shall not have any liability for any action taken by any employee, agent or independent contractor selected with reasonable care, or for any loss incurred through the investment of or failure to invest monies of the Corporation or any Trust Account. No Director, officer, employee or agent shall be liable for any action taken or omitted by another Director, officer, employee or agent. 6.2 INDEMNIFICATION. EACH PERSON WHO AT ANY TIME SHALL SERVE, OR SHALL HAVE SERVED, AS A DIRECTOR, OFFICER, EMPLOYEE OR AGENT OF THE CORPORATION, OR ANY PERSON WHO, WHILE A DIRECTOR, OFFICER, EMPLOYEE -8- OR AGENT OF THE CORPORATION, IS OR WAS SERVING AT ITS REQUEST AS A DIRECTOR, OFFICER, PARTNER, VENTURER, PROPRIETOR, TRUSTEE, EMPLOYEE, AGENT OR SIMILAR FUNCTIONARY OF ANOTHER FOREIGN OR DOMESTIC CORPORATION, PARTNERSHIP, JOINT VENTURE, SOLE PROPRIETORSHIP, TRUST EMPLOYEE BENEFIT PLAN OR OTHER ENTERPRISE, SHALL BE ENTITLED TO INDEMNIFICATION AS, AND TO THE FULLEST EXTENT, PERMITTED BY ARTICLE 1396 2.22A OF THE TEXAS NON PROFIT CORPORATION ACT OR ANY SUCCESSOR STATUTORY PROVISION, AS FROM TIME TO TIME AMENDED, SUCH ARTICLE OR SUCCESSOR PROVISION, AS SO AMENDED, BEING INCORPORATED IN FULL IN THESE BYLAWS BY REFERENCE. THE FOREGOING RIGHT OF INDEMNIFICATION SHALL NOT BE DEEMED EXCLUSIVE OF ANY OTHER RIGHTS TO WHICH THOSE TO BE INDEMNIFIED MAY BE ENTITLED AS A MATTER OF LAW OR UNDER ANY AGREEMENT, VOTE OF DISINTERESTED DIRECTORS, OR OTHER ARRANGEMENT. IT IS EXPRESSLY ACKNOWLEDGED THAT THE INDEMNIFICATION PROVIDED IN THIS ARTICLE COULD INVOLVE INDEMNIFICATION FOR NEGLIGENCE OR UNDER THEORIES OF STRICT LIABILITY. 6.3 Advance Payment. The right to indemnification conferred in this Article VI shall include the right to be paid in advance or reimbursed by the Corporation the reasonable expenses incurred by a person of the type entitled to be indemnified under Section 2 who was, is or is threatened to be made a named defendant or respondent in a proceeding in advance of the final disposition of the proceeding and without any determination as the person's ultimate entitlement to indemnification; provided, however, that the payment of such expenses incurred by any such person in advance of the final disposition of a proceeding, shall be made only upon delivery to the Corporation of a written affirmation by such Director or officer of his or her good faith belief that he or she has met the standard of conduct necessary for indemnification under this Article 6 and a written undertaking, by or on behalf of such person, to repay all amounts so advanced if it shall ultimately be determined that such indemnified person is not entitled to be indemnified under this Article 6 or otherwise. 6.4 Appearance as a Witness. Notwithstanding any other provision of this Article 6, the Corporation may pay or reimburse expenses incurred by a Director or officer in connection with his or her appearance as a witness or other participation in a proceeding involving the Corporation or its business at a time when he or she is not a named defendant or respondent in the proceeding. 6.5 Non - Exclusivity of Rights. The right to indemnification and the advancement and payment of expenses conferred in this Article 6 shall not be exclusive of any other right which a Director or officer or other person indemnified pursuant to this Article 6 may have or hereafter acquire under any law (common or statutory), provision of the Articles of Incorporation of the Corporation or these Bylaws, agreement, vote of shareholders or disinterested Directors or otherwise. 6.6 Savings Clause. If this Article 6 or any portion hereof shall be invalidated on any -9- ground by any court of competent jurisdiction, then the Corporation shall nevertheless indemnify and hold harmless each Director, officer or any other person indemnified pursuant to this Article VI as to costs, charges and expenses (including attorneys' fees), judgments, fines and in amounts paid in settlement with respect to any action, suit or proceeding, whether civil, criminal, administrative or investigative, to the full extent permitted by any applicable portion of this Article VI that shall not have been invalidated and to the fullest extent permitted by applicable law. (b) ARTICLE 7. Code of Conduct 7.1 Policy and Purposes. (a) It is the policy of the Corporation that Directors and officers conduct themselves in a manner consistent with sound business and ethical practices; that the public interest always be considered in conducting corporate business; that the appearance of impropriety be avoided to ensure and maintain public confidence in the Corporation; and that the Board establish policies to control and manage the affairs of the Corporation fairly, impartially, and without discrimination. (b) This Code of Ethics has been adopted as part of the Corporation's Bylaws for the following purposes: (a) to encourage high ethical standards in official conduct by Directors and corporate officers; and (b) to establish guidelines for such ethical standards of conduct. 7.2 Conflicts of Interest. (a) Except as provided in subsection (c), a Director or officer is prohibited from participating in a vote, decision, or award of a contract involving a business entity or real property in which the Director or the officer has a substantial interest, if it is foreseeable that the business entity or real property will be economically benefitted by the action. A person has a substantial interest in a business (i) if his or her ownership interest is ten percent or more of the voting stock or shares of the business entity or ownership of $15,000 or more of the fair market value of the business entity, or (ii) if the business entity provides more than ten percent of the person's gross income. A person has a substantial interest in real property if the interest is an equitable or legal ownership with a fair market value of $2,500 or more. An interest of a person related in the first degree by affinity (marriage relationship) or consanguinity (blood relationship) to a Director or officer is considered a substantial interest. If a Director or a person related to a Director in the first degree by affinity or the first degree by consanguinity has a substantial interest in a business entity or real property that would be pecuniarily affected by any official action taken by the Board, such Director, before a vote or decision on the matter, shall file an affidavit stating the nature and extent of the interest. The affidavit shall be filed with the Secretary of the Board. (c) A Director who has a substantial interest in a business entity that will receive a pecuniary benefit from an action of the Board may vote on that action if a majority of the Board has a similar interest in the same action or if all other similar business entities in the Corporation will receive a similar pecuniary benefit. (d) An employee of a public entity may serve on the Board.7.3 Acceptance of Gifts. No Director or officer shall accept any benefit as consideration for any decision, opinion, -10- recommendation, vote or other exercise of discretion in carrying out official acts for the Corporation. No Director or officer shall solicit, accept, or agree to accept any benefit from a person known to be interested in or likely to become interested in any contract, purchase, payment, claim or transaction involving the exercise of the Director's or officer's discretion As used here, a benefit does not include: (a) a fee prescribed by law to be received by a Director or officer or any other benefit to which the Director or officer is Lawfully entitled or for which he or she gives legitimate consideration in a capacity other than as a Director or officer, (b) a gift or other benefit conferred on account of kinship or a personal, professional. or business relationship independent of the official status of the Director or officer; (c) an honorarium in consideration for legitimate services rendered above and beyond official duties and responsibilities if. (1) not more than one honorarium is received from the same person in a calendar year; (2) not more than one honorarium is received for the same service; and (3) the value of the honorarium does not exceed $50 exclusive of reimbursement for travel, food, and lodging expenses incurred by the Director or officer in performance of the services; (d) a benefit consisting of food, lodging, transportation, or entertainment accepted as a guest if reported as may be required by law. 7.4 Bribery. A Director or officer shall not intentionally or knowingly offer, confer or agree to confer on another, or solicit, accept, or agree to accept from another: (a) any benefit as consideration for the Director's or officer's decision, opinion, recommendation, vote, or other exercise of discretion as a Director or officer; (b) any benefit as consideration for the Director or officer's decision, vote, recommendation, or other exercise of official discretion in a judicial or administrative proceeding; or (c) any benefit as consideration for a violation of duty imposed by law on the Director or officer. 7.5 Notice. No Director or officer shall appoint, or vote for, or confirm the appointment to any office, position, clerkship, employment or duty, of an person related within the second degree by affinity or within the third degree of consanguinity to the Director or officer so appointing, voting or confirming, or to any other Director or officer. This provision shall not prevent the appointment, voting for, or confirmation of any person who shall have been -11- continuously employed in any such office, position, clerkship, employment or duty at least thirty (30) days prior to the appointment of the Director or officer so appointing or voting. ARTICLE 8. Miscellaneous Provisions 8.1 Fiscal Year. The fiscal year for the Corporation shall begin on and end on . This fiscal year shall also be referred to as the Corporation Year. 8.2 Seal. The seal of the Corporation shall be such as from time to time may be approved by the Board. 8.3 Gender. References herein to the masculine gender shall also refer to the feminine in all appropriate cases, and vice versa. 8.4 Appropriations and Grants. The Corporation shall have the power to request and accept any appropriation, grant, contribution, donation, or other form of aid from the federal government, the State, any political subdivision, or municipality in the State, or from any other source. 8.5 Amendments. These bylaws may be amended by the Board after notice of the proposed amendments has been mailed to each Director of the Board at least ten (10) days prior to the day of the meeting to consider same. The Board shall recommend such changes as it deems necessary or desirable from time to time. Any amended Bylaws shall be signed by the Chairman and attested to by the Secretary. A copy of any amendment shall be mailed immediately after its adoption to each Member. 8.6 Conflicts of Interest. Each Director, committee member and subcommittee member shall have an affirmative duty to disclose to the Board of Directors, the committee or subcommittee (as the case may be) any actual or potential conflicts of interest between such Director, committee member or subcommittee member, and the Corporation where, and to the extent that, such conflicts or potential conflicts directly or indirectly affect any matter that comes before the Board of Directors, or any committee or subcommittee. 111409 \0001 \BYLAW SGO V O l .wpd -12- BYLAWS OF GOVERNMENTAL AGGREGATION PROJECT, INC. ARTICLE 1. Name and Purpose 1.1 Name. This corporation shall be known as Governmental Aggregation Project, Inc. 1.2 Purpose. The corporation has been organized for any and all lawful business for which corporations may be organized under the Texas Non Profit Corporations Act, for the purposes of purchasing electricity, aiding or acting on behalf of its Members with respect to their own electricity use for their respective public facilities and negotiating on behalf of its Members for the purchase of electricity, making contracts for the purchase of electricity, and taking any other actions necessary to purchase electricity for use in the public facilities of the political subdivision or subdivisions represented by the corporation, for the purposes of acting as a local cooperative organization to purchase goods and ancillary services for its members, in accordance with Texas Local Government Code, Chapter 303, entitled, "Energy Aggregation Measures for Local Governments," Section 303.001(d), and for all other purposes as may be permitted by law for political subdivision corporations. ARTICLE 2. Board of Directors 2.1 Composition. There shall be a Chair and a Vice Chair on the board and such other directors as required for the performance of duties. 2.2 Powers. The affairs of the Corporation shall be managed by the Board of Directors, which may exercise all such powers of the corporation and do all such lawful acts and things as are not prohibited by statute, by the Articles of Incorporation of the Corporation, or by these Bylaws. By illustration and without limitation, included among the powers of the Board of Directors is the power to negotiate the purchase of electricity, aid or act on behalf of the political subdivisions for which the corporation is created, make contracts for the purchase of electricity, purchase electricity, and take any other action necessary to purchase electricity for use in the public facilities of the political subdivision or subdivisions represented by the Corporation; provided, however, no Member shall be obligated under any such contract unless the Member approves such contract. 2.3 Number, Tenure and Qualification. (a) Directors shall be elected to the Board at annual meetings of the Members as hereinafter described from a slate presented by the Board and from nominations by Members. Nominations for membership on the Board made by Members shall not be considered at any meeting of the Members unless such nomination has been presented in writing, signed by the Member or Members proposing the same, and filed with the Secretary of the Corporation at least sixty (60) days prior to the date of the meeting at which said nominations are to be considered, except for the first elected Board, as described in Subsections (b) and (c) General Manager, City Manager, Operations Manager, etc.] to serve as [IDENTIFY ENTITY's representative to the corporation and to act on [IDENTIFY ENTITY's] behalf Section 6. All Resolutions and parts thereof in conflict herewith are hereby expressly repealed insofar as they conflict herewith. Section 7. This Resolution shall take effect immediately from and after its adoption and it is accordingly so resolved. Signed this 111409 \0001\RESOLUO2.wpd day of , 2001. Mayor ATTEST: Secretary -2- ARTICLES OF INCORPORATION OF GOVERNMENTAL AGGREGATION PROJECT, INC. ARTICLE ONE The corporation will conduct business under the name Governmental Aggregation Project, Inc. ARTICLE TWO The period of its duration is perpetual. ARTICLE THREE The corporation is a non -profit political subdivision corporation authorized by Section 303.001 of Chapter 303, Texas Local Government Code, entitled "Energy Aggregation Measures for Local Governments," as amended ( "Chapter 303 "). ARTICLE FOUR The corporation has been organized for the purposes of purchasing electricity, aiding or acting on behalf of its members with respect to their own electricity use for their respective public facilities and negotiating on behalf of its members for the purchase of electricity, making contracts for the purchase of electricity, and taking any other actions necessary to purchase electricity for use in the public facilities of the political subdivision or subdivisions represented by the corporation as authorized by Chapter 303, Section 303.001(d), and for all other purposes as may be permitted by law for political subdivision corporations. These Articles have been approved by the governing body of each political subdivision for which the corporation is created. ARTICLE FIVE The street address for the corporation's initial registered office is Arboretum Great Hills Center, 9600 Great Hills Trail, Suite 150W, Austin, Texas 78759, and the registered agent for the corporation at this address is Clarence A. West. ARTICLE SIX The corporation shall have political subdivisions as members. Membership shall be determined under the terms and conditions provided in the corporation's bylaws. ARTICLE SEVEN 1 The direction and management of the affairs of the corporation and the control and disposition of its properties and funds shall be vested in a Board of Directors composed of such number of persons, but not less than three, as may be fixed by the bylaws. Until changed by the bylaws, the original number of directors shall be three (3). The names and addresses of the persons who are to serve as Directors of the corporation until their successors are duly elected and qualified are: 1 . Jeff Braun City Manager City of Rosenberg 2110 Fourth Street / P.O. Box 32 Rosenberg, TX 77471 -0032 2. James Thurmond City Manager City of Missouri City 1522 Texas Parkway Missouri City, TX 77459 3. Andres Garza, Jr., City Manager City of Wharton 120 East Caney Street Wharton, TX 77488 1 . Jeff Braun City Manager City of Rosenberg 2110 Fourth Street / P.O. Box 32 Rosenberg, TX 77471 -0032 2. James Thurmond City Manager City of Missouri City ARTICLE EIGHT The bylaws of the corporation shall be adopted by the Board of Directors and shall be approved by the governing body of each political subdivision Member for which the corporation is created. ARTICLE NINE The names and addresses of the incorporators are: 2 1522 Texas Parkway Missouri City, TX 77459 3. Andres Garza, Jr., City Manager City of Wharton 120 East Caney Street Wharton, TX 77488 The undersigned incorporators, all of whom are over the age of eighteen (18) and are citizens of the State of Texas, sign these Articles of Incorporation subject to the penalty imposed by Article 9.03A, Texas Non -Profit Corporation Act. ROSENBERG MISSOURI CITY WHARTON 3 Jeff Braun City Manager James Thurmond City Manager Andres Garza, Jr. City Manager CITY OF By: CITY OF By: CITY OF By: 2001. COUNTY OF FORT BEND 1 THE STATE OF TEXAS 1 COUNTY OF FORT BEND 1 BEFORE ME, a notary public, on this day personally appeared Jeff Braun, City Manager of the City of Rosenberg, Texas, known to me to be the person whose name is subscribed to the foregoing document and, being by me first duly swam, declared that the statements therein contained are true and correct. Given under my hand and seal of office this day of State of Texas THE STATE OF TEXAS 1 Given under my hand and seal of office this State of Texas 4 day of , 2001. Notary Public, BEFORE ME, a notary public, on this day personally appeared James Thurmond, City Manager of Missouri City, Texas, known to me to be the person whose name is subscribed to the foregoing document and, being by me first duly sworn, declared that the statements therein contained are true and correct. Notary Public, COUNTY OF WHARTON 1 1 1 1 4 09100 0 11ARTINCGOVOl .wpd THE STATE OF TEXAS BEFORE ME, a notary public, on this day personally appeared Andres Garza, Jr., City Manager of Wharton, Texas, known to me to be the person whose name is subscribed to the foregoing document and, being by me first duly sworn, declared that the statements therein contained are true and correct. Given under my hand and seal of office this State of Texas 5 day of , 2001. Notary Public,