Exhibit 10.15

Seventh Amended and Restated Rent Supplement

(ERCOT Transmission Lease)

February 22, 2017

 

This Seventh Amended and Restated Rent Supplement (this “Seventh Amended
Supplement”) between Sharyland Distribution & Transmission Services, L.L.C.
(“Lessor”) and Sharyland Utilities, L.P. (“Lessee”) is executed and delivered on
February 22, 2017, to memorialize supplements to the ERCOT Transmission Lease
(as defined below), effective as of January 1, 2017. Capitalized terms used
herein that are not otherwise defined will have the meanings assigned to them in
the ERCOT Transmission Lease.  

WHEREAS, Lessor and Lessee are Parties to a Lease Agreement (ERCOT Transmission
Assets) dated December 1, 2014 (as amended from time to time in accordance with
its terms, the “ERCOT Transmission Lease”);

WHEREAS, on December 31, 2016, the Parties executed a Sixth Amended and Restated
Rent Supplement (ERCOT Transmission Lease) effective as of January 1, 2017 (the
“Sixth Amended Supplement”);

WHEREAS, the Incremental CapEx for 2016 was different than expected by the Sixth
Amended Supplement and the Parties wish to effect a Rent Validation (as set
forth in Section 3.2(c) of the ERCOT Transmission Lease) and to amend and
restate the Sixth Amended Supplement to memorialize the effect of such
difference; and

WHEREAS, as a result of this Rent Validation, a one-time payment set forth below
is owed by Lessee and will be paid within 30 days after execution hereof.

NOW THEREFORE, in consideration of the premises and for other good and valuable
consideration, the receipt of which is hereby acknowledged, the Parties hereto
agree to the following:

1.The Sixth Amended Supplement is hereby amended and restated in its entirety as
set forth below.

2.The ERCOT Transmission Lease, except as supplemented by this Seventh Amended
Supplement, shall remain in full force and effect.

Incremental CapEx:

 

 

 

2014

$ 18,470,677

 

2015

$ 22,517,350

 

2016

2017

$   9,050,252*

$   4,553,684**

 

* Represents the “validated” aggregate amount of 2016 Incremental CapEx, i.e. a
Rent Validation has occurred pursuant to Section 3.2(c) of the ERCOT
Transmission Lease, and, as part of this Rent Validation, the Parties have
restated the aggregate amount of 2016 Incremental CapEx placed in service,
consisting of (i) the amount of 2016 Incremental CapEx placed in service as of
the balance sheet date reflected in Lessee’s first 2016 Regulatory Order (“First
2016 CapEx”); (ii) the amount of 2016 Incremental CapEx placed in service as of
the balance sheet date reflected in Lessee’s second 2016 Regulatory Order
(“Second 2016 CapEx”); and (iii) the amount of 2016 Incremental CapEx placed in
service throughout the remainder of 2016 (“2016 Stub-Year CapEx”), together with
the  weighted average in-service dates of 2016 Incremental CapEx and the
effective dates for the first and second 2016 Regulatory Orders. A “Regulatory
Order” is defined as either (i) the PUCT’s approval of Lessee’s

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application for updated wholesale transmission rates or (ii) final resolution or
settlement of a rate case applicable to Lessee’s transmission rates. The
aggregate amount of 2016 Incremental CapEx has been restated to $9,050,252 with
a weighted average in-service date of May 1, 2016.  The aggregate amount of
estimated 2016 Incremental CapEx included in the Sixth Amended Supplement was
$9,237,495, with a weighted average in-service date of June 1, 2016.  The
Parties placed in service an aggregate of $5,178,973 of First 2016 CapEx, which
was included in the first 2016 Regulatory Order that became effective on June
13, 2016; an aggregate of $1,386,576 of Second 2016 CapEx, which was included in
the second 2016 Regulatory Order that became effective on September 22, 2016;
and an aggregate of $2,484,702 of 2016 Stub-Year CapEx, which has not yet been
included in a Regulatory Order. The amount of First 2016 CapEx included in the
Sixth Amended Supplement was $4,244,655, the amount of Second 2016 CapEx
included in the Sixth Amended Supplement was $2,068,871 and the amount of 2016
Stub-Year CapEx included in the Sixth Amended Supplement was $2,905,968. As set
forth in the Sixth Amended Supplement, the Parties expected the first 2016
Regulatory Order to be effective on June 1, 2016, the second 2016 Regulatory
Order to be effective on October 1, 2016, and the first 2017 Regulatory Order to
be effective on March 1, 2017.

 

** Represents the aggregate amount of Incremental CapEx the Parties expect to be
placed in service in 2017. Rent supplements with respect to this Incremental
CapEx were agreed to and memorialized as part of the Sixth Amended Supplement.
Of the 2017 Incremental CapEx, $0 is expected to be in service as of the balance
sheet date reflected in Lessee’s first 2017 Regulatory Order (“First 2017
CapEx”), an aggregate of $4,553,684 is expected to be in service as of the
balance sheet date reflected in Lessee’s second 2017 Regulatory Order (“Second
2017 CapEx”), and $0 is expected to be placed in service throughout the
remainder of 2017 (“2017 Stub-Year CapEx”) and to be included in the first 2018
Regulatory Order.  The Parties expect the First 2017 CapEx, Second 2017 CapEx,
and 2017 Stub-Year CapEx, collectively, to have a weighted average in-service
date of June 1, 2017.  The Parties expect the first 2017 Regulatory Order to be
effective on May 1, 2017, the second 2017 Regulatory Order to be effective on
March 1, 2018, and the first 2018 Regulatory Order to be effective on June 1,
2018.  The Parties agree that any Rent Validation (within the meaning of the
ERCOT Transmission Lease) with respect to First 2017 CapEx, Second 2017 CapEx,
or 2017 Stub-Year CapEx will use the actual effective dates of the applicable
Regulatory Order (to the extent known), but will otherwise be determined in
accordance with Section 3.2(c) of the ERCOT Transmission Lease.

 

Lessee CapEx:

 

 

 

2014

$ 0

 

2015

$ 0

 

2016

2017

$ 0

$ 0

 

Base Rent:

 

 

 

2014

$   484,276

 

2015

$2,477,452

 

2016

$4,601,290#

 

2017

$4,780,089##

 

2018

$5,016,364###

 

2019

$4,916,159

 

2020

$4,742,435

 

2021

$4,576,851

 

2022

$4,414,163

 

# Represents the “validated” amount of 2016 Base Rent, i.e. a Rent Validation
has occurred pursuant to Section 3.2(c) of the ERCOT Transmission Lease and, as
part of this Rent Validation, the amount of 2016 Base Rent has been
restated.  The amount of 2016 Base Rent included in the Sixth Amended Supplement

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was $4,547,412 comprised of 2016 Base Rent payments of (i) $355,151 on the 15th
day of each month beginning on March 15, 2016 through August 15, 2016 (with
respect to January 2016 through June 2016); (ii) $396,049 on the 15th day of
each month beginning on September 15, 2016 through December 15, 2016 (with
respect to July 2016 through October 2016), with the increase in monthly Base
Rent reflecting First 2016 CapEx and commencing July 1, 2016, which was 30 days
after the expected approval of Lessee’s first 2016 Regulatory Order; and (iii)
$416,155 on each of January 15, 2017 and February 15, 2017 (with respect to
November 2016 and December 2016), with the increase in monthly Base Rent
reflecting Second 2016 CapEx and commencing November 1, 2016, which was 30 days
after the expected approval of Lessee’s second 2016 Regulatory Order.  The first
2016 Regulatory Order and the second 2016 Regulatory Order were effective June
13, 2016, and September 22, 2016, respectively.  Lessee owes Lessor $53,878 (the
difference between the amount set forth as Base Rent above and the aggregate
amount of monthly Base Rent set forth in this footnote), in validated Base Rent,
and will make the validation payment set forth under “Validation Payment” below
within 30 days of the date hereof.  

 

## Lessee will make a monthly 2017 Base Rent payment of $398,341 on the 15th day
of each month beginning on March 15, 2017 through June 15, 2017 (with respect to
January 2017 through April 2017).  Lessee will then make a 2017 Base Rent
payment of $398,341 on the 15th day of each month beginning on July 15, 2017
through February 15, 2018 (with respect to May 2017 through December 2017), with
the increase in monthly Base Rent reflecting 2016 Stub-Year CapEx and commencing
May 1, 2017, which is the expected date of the approval of Lessee’s first 2017
Regulatory Order.  

 

### Lessee will make a monthly 2018 Base Rent payment of $386,092 on the 15th
day of each month beginning on March 15, 2018 through April 15, 2018 (with
respect to January 2018 through February 2018).  Lessee will then make a 2018
Base Rent payment of $424,418 on the 15th day of each month beginning on May 15,
2018 through July 15, 2018 (with respect to March 2018 through May 2018), with
the increase in monthly Base Rent reflecting Second 2017 CapEx and commencing
March 1, 2018, which is 30 days after the expected approval of Lessee’s second
2017 Regulatory Order.  Lessee will then make a 2018 Base Rent payment of
$424,418 on the 15th day of each month beginning on August 15, 2018 through
February 15, 2019 (with respect to June 2018 through December 2018), with the
increase in monthly Base Rent reflecting 2017 Stub-Year CapEx and commencing
June 1, 2018, which is the expected date of the approval of Lessee’s first 2018
Regulatory Order.  

 

Percentage Rent Percentages:

 

 

 

2014

35.8%

 

2015

35.1%

 

2016

31.1% #

 

2017

28.2%

 

2018

27.2%

 

2019

26.2%

 

2020

25.3%

 

2021

24.4%

 

2022

23.5%

 

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# Represents the “validated” percentage applicable to 2016 Percentage Rent, i.e.
a Rent Validation has occurred pursuant to Section 3.2(c) of the ERCOT
Transmission Lease and, as part of this Rent Validation, the 2016 percentage has
been restated.  The 2016 percentage included in the Sixth Amended Supplement was
31.1% (i.e., even though the percentage has not changed it has been “validated”
pursuant to this Rent Validation).

 

Annual Percentage Rent

 

 

Breakpoints:

 

 

 

2014

$   484,276

 

2015

$2,477,452

 

2016

$4,664,546#

 

2017

$4,804,290*

 

2018

$5,016,364**

 

2019

$4,916,159

 

2020

$4,742,435

 

2021

$4,576,851

 

2022

$4,414,163

 

# Represents the “validated” 2016 Annual Percentage Rent Breakpoint, i.e. a Rent
Validation has occurred pursuant to Section 3.2(c) of the ERCOT Transmission
Lease and, as part of this Rent Validation, the 2016 Annual Percentage Rent
Breakpoint has been restated.  The 2016 Annual Percentage Rent Breakpoint
included in the Sixth Amended Supplement was $4,608,413.

 

* The 2017 Annual Percentage Rent Breakpoint reflects the assumptions set forth
above regarding the timing of the first 2017 Regulatory Order and the second
2017 Regulatory Order, as well as the amount of First 2017 CapEx and Second 2017
CapEx.

 

** The 2018 Annual Percentage Rent Breakpoint reflects the assumptions set forth
above regarding the timing of the first 2017 Regulatory Order, the second 2017
Regulatory Order, and the first 2018 Regulatory Order, as well as the amount of
First 2017 CapEx, Second 2017 CapEx, and 2017 Stub-Year CapEx.

 

Revenues Attributable to

 

 

Lessee CapEx:

 

 

 

2014

$ 0

 

2015

$ 0

 

2016

$ 0

 

2017

$ 0

 

2018

$ 0

 

2019

$ 0

 

2020

$ 0

 

2021

$ 0

 

2022

$ 0

 

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Validation Payment:  As a result of the validation described above, pursuant to
Section 3.2(c) of the ERCOT Transmission Lease, Lessee will pay Lessor $36,806,
within 30 days following execution hereof, of which $53,878 is attributable to
validated Base Rent and $(17,072) is attributable to the validation of
Percentage Rent.

 

ERCOT Transmission Rate

 

Allocation:

before October 3, 2014:  0%

 

between October 3, 2014 and March 31, 2015: 2.1%

 

between April 1, 2015 and October 31, 2015: 2.1%

 

between November 1, 2015 and June 13, 2016: 3.6%

 

between June 13, 2016 and September 22, 2016:  4.1%

 

between September 23, 2016 and April 30, 2017:  3.6%

 

between May 1, 2017 and February 28, 2018:  3.6%

 

starting March 1, 2018:  3.6%

 

 

Term of Rent Supplement:

Expires 12/31/22

 

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The Parties have executed this Seventh Amended Supplement to the ERCOT
Transmission Lease as of the date set forth above.

 

 

 

SHARYLAND UTILITIES, L.P.

 

 

 

 

By:

/s/ Greg Wilks

 

Name:

Greg Wilks

 

Title:

Chief Financial Officer

 

 

 

 

SHARYLAND DISTRIBUTION &

 

TRANSMISSION SERVICES, L.L.C.

 

 

 

 

By:

/s/ Brant Meleski

 

Name:

Brant Meleski

 

Title:

Chief Financial Officer

 

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ERCOT Transmission Lease