2007/10/17 Council Agenda Packet

L, materials available for audit at the District during normal business hours. This obligation shall continue for the term of the existing FERC license and any renewal, extension or new license, or until the provisions of Article IV, Section 2, of the 1960 Agreement are amended or terminated, whichever is sooner. C. PAYMENT BY CITY 1. The City agrees to pay the District the nonrefundable sum of$5,000,000.00 within 30 days of the Execution Date of this Supplemental Agreement. 2. The City also agrees to pay the District the additional sum of$5,000,000.00, in 2007 dollars, as adjusted for changes in the Consumer Price Index up to the date of the issuance by the FERC and acceptance by the District of a new FERC license for the Project.Payment of this sum by the City is contingent upon the District accepting a future license for the Project. This additional sum, as adjusted for changes in the Consumer Price Index, shall be due within 30 days of the City's receipt of notice from the District that it has accepted the license for the Project, including notice of the adjusted principal amount owed. 3. The actual principal amount to be paid by the City upon the District's acceptance of the license shall be the sum of$5,000,000.00 adjusted from the base period until the District's acceptance of the license by an amount established by reference to the"Consumer Price Index—All Urban Consumers,All Items, U.S. City Averages, 1982-1984=100"published by the Bureau of Labor Statistics of the United States Department of Labor, Bureau of Labor Statistics(the "Consumer Price Index"). The base period shall be the month ending February 28, 2007("Base Period"). If the Consumer Price Index for the month ending when the license is accepted is greater than the Consumer Price Index for the Base Period, the payment owed by the City shall be increased by the amount obtained by multiplying the payment owed by a fraction,the numerator of which is the Consumer Price Index for the month ending when the license is accepted by the District and the denominator of which is the Consumer Price Index for the Base period. It is acknowledged that data to determine ongoing adjustments to the Consumer Price Index necessarily lags behind real time and may not be available to provide a published Index adjustment for the entire period prior to the date of District acceptance of the FERC license. Because the parties require an objective calculation to determine the actual principal amount to be paid by the City to the District, as adjusted by the Consumer Price Index,the parties agree as follows: for any period between the date of the last published monthly Consumer Price Index adjustment and the date of District acceptance of the new FERC license, the applicable Index adjustment shall be equal to the average of the published Consumer Price Index adjustments for the three month period immediately prior to the date of license acceptance. 4