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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
Current Report
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (date of earliest event reported) - February 22, 2005
TXU ELECTRIC DELIVERY COMPANY
(Exact name of registrant as specified in its charter)
TEXAS 333-100240 75-2967830
(State or other jurisdiction (Commission File (I.R.S. Employer
of incorporation) Number) Identification No.)
Registrant's telephone number, including Area Code - (214) 486-2000
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[] Written communications pursuant to Rule 425 under the
Securities Act (17 CFR 230.425)
[] Soliciting material pursuant to Rule 14a-12 under the
Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
On February 22, 2005, TXU Electric Delivery Company (the "Company")
entered into a settlement agreement (the "Agreement") with a steering committee
of cities served by the Company on behalf of 110 cities party to the Agreement
(collectively, the "Cities"). In 2004, the city councils of 23 of the Cities
passed resolutions requiring the Company to file with those cities information
that demonstrated good cause for showing that the Company's transmission and
distribution rates should not be reduced (the "Actions"). The Agreement provides
a compromise and settlement to resolve the issues raised in the Actions.
Under the terms of the Agreement, among other things:
o the Company agreed to file a system-wide rate case (the "Rate
Case") at the Public Utility Company of Texas no later than July
1, 2006 (based on a test year ending December 31, 2005) unless the
Cities and the Company mutually agree that such a filing is
unnecessary;
o the Cities agreed to abate or dismiss the Actions;
o the Company agreed to pay $8.5 million to the Cities by the later
of March 31, 2005 or two weeks after receiving notice from the
Cities that certain of the Cities have abated or dismissed the
Actions and certain other of the Cities have approved the
Agreement;
o the Company agreed to pay certain expenses of the Cities related
to the Actions (limited to $100,000) and the Rate Case (limited
to $2.0 million);
o in addition, the Company agreed, beginning March 31, 2006 and
annually thereafter, to pay $8.0 million to the Cities until the
Cities breach their obligations under the Agreement or the date
upon which the tariffs approved in the Rate Case become effective
on a temporary or permanent basis;
o the Company and the Cities agreed to work towards improved
relationships with respect to, among other things, streetlight
management processes, relocations of the Company's facilities in
public rights of way, franchise issues and undergrounding of new
or existing utility facilities. The Company expects any material
costs associated with these activities to be recoverable in
tariffs.
In the fourth quarter of 2004, the Company recorded a $21 million ($14
million after-tax) charge for estimated settlement payments related to the
Actions. The estimate includes the offer of similar terms to other cities served
by the Company who were not a party to the Agreement. Based on the terms of the
Agreement, the Company believes the estimate was reasonable and does not
anticipate any material additional charges.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
following registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
TXU ELECTRIC DELIVERY COMPANY
By: /s/ Stan Szlauderbach
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Name: Stan Szlauderbach
Title: Senior Vice President
and Controller
Dated: February 28, 2005
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