Loading...
HomeMy WebLinkAboutContract 33925 CITY SECRETARY r C' CONTRACT NO. `Q D AGREEMENT FOR SALE OF TREATED WATER This Agreement for Sale of Treated Water ("Agreement") is entered into by and between Johnson County Special Utility District, a conservation and reclamation district located in Johnson, Hill, Ellis, and Tarrant Counties, Texas, created under Section 59, Article XVI, Texas Constitution (the "District") and the City of Fort Worth, a Texas home-rule municipality located in Tarrant, Denton and Wise Counties, Texas (the ARTICLE I RECITALS A. Clark Briscoe Company, LTD, a Texas limited partnership ("Owner is developing approximately 194.044 acres of land located in the City's extraterritorial jurisdiction in Tarrant County, Texas, shown on Exhibit A and more particularly described in Exhibit B (the "Development") as a portion of a residential subdivision known as "The Bridges", and has requested the District to provide retail water service to the Development. B. The Development is located within Certificate of Convenience and Necessity ("CCN") No. 10081 issued to the District by the Texas Commission on Environmental Quality, pursuant to which the District is to be the retail provider of a continuous and adequate supply of water to the Development. C. The City has obtained at its own expense, and now owns, operates and maintains facilities for processing and distributing a supply of surface water, and is authorized to furnish and deliver treated water, both inside and outside its corporate boundaries. D. The District has considered its various alternatives for obtaining a water supply for its retail water service to the Development under its CCN and has elected to seek to obtain water from the City. E. The City and the District have reached a mutually satisfactory agreement by which the District may purchase a supply of treated water from the City to serve the Development. F. The City will provide retail wastewater service to the Development at the outside- City rate established by the City Council from time to time (M &C C-21564). G. The remainder of The Bridges is located within the City of Crowley and is not subject to this Agreement. NOW, THEREFORE, for and in consideration of the mutual agreements, covenants, and conditions hereinafter set forth,the Parties contract and agree as follows: ' 786165All _ 2 ` F! \3 � r JOHNSON COUNTY SPECIAL UTILITY DISTRICT '�, � �' WATER SUPPLY CONTRACT ��ti �" � 'Page ARTICLE II DEFINITIONS "Agreement" means this Agreement for Sale of Treated Water between the City and the District. "Annual Consumption" means the total quantity of water purchased under the terms of this Agreement by the District during the City's Fiscal Year as determined by the difference in the annual October Meter readings. "Average Dail"means the total Annual Consumption divided by 365 days. "C�"means the City of Fort Worth, Texas, a home-rule municipality. "City Council"means the City Council of the City. "City Review Fees" means any fees and charges applicable to the review and approval of plans relating to the construction of Infrastructure according to the fee schedule adopted by the City Council and in effect on the date of submittal of such plans. "Cil, Utility Standards" means all City fire protection requirements for water line sizing, number of connections, minimum water pressure and number of fire hydrants and all City standards for design, location, construction, operation and maintenance of water Infrastructure. expressly including without limitation the following: (a) Subdivision Regulations; (b) CFA Policy; (c) Policy and Procedure for Processing Water and Wastewater Projects for Design and Construction(1999); and (d) General Contract Documents and Specifications for Water Department Projects "Customer System" means all water mains and distribution facilities (whether owned by the District or third parties) within the Development and on the District's side of the Meter shown on Exhibit C, from and beyond the Point of Delivery of treated water by the City. "Development" means that certain approximately 194.044-acre tract located in the City's extraterritorial jurisdiction in Tarrant County, Texas shown on Exhibit A and more particularly described in Exhibit B, consisting of a portion of The Bridges subdivision. "Director"means the City Water Department Director or designee. "District" means Johnson County Special Utility District, a conservation and reclamation district located in Johnson, Hill, Ellis, and Tarrant counties, created under Section 59, Article XVI, Texas Constitution. "Effective Date"means the effective date as defined in Section 10.02. 786165_3 z{+.�`•c U gi5' JOHNSON COUNTY SPECIAL UTILITY DISTRICT �� WATER SUPPLY CONTRACT Page 2 "ETJ" means the extraterritorial jurisdiction of the City as defined by the Texas Local Government Code, as amended, being an unincorporated area presently extending five miles from the City's corporate limits, excluding other incorporated municipalities and their respective extraterritorial jurisdictions. "Fiscal Year" means the City's fiscal year from October 1 through September 30. "Fort Worth System" means the City's water treatment and distribution system. "Infrastructure" means all water facilities, equipment or related improvements necessary to serve the Development, whether located within or outside the Development. "Maximum Day Demand" means the maximum quantity of water used by the District during one calendar day of the City's Fiscal Year. "Maximum Hour Demand" means the maximum quantity of water used by the District during the one hour of the year that more water passed through the Meter serving the District than during any other hour of the City's Fiscal Year, multiplied by 24 hours. "Metering Facilities" means all facilities associated with metering the water provided hereunder, excluding the Meter, and including without limitation continuous flow chart recording devices and telemetering equipment connected with the City's SCADA control center. "Meter"means the eight (8") inch meter located at the Point of Delivery shown on Exhibit C. "MGD"means million gallons per day. "Notice"means notice as defined in Section 13.02 of this Agreement. "Parties" means the City and the District, their successors and their assigns, as permitted by this Agreement. "Party" means, individually, the City or the District, their successors and their assigns, as permitted by this Agreement. "Point of Delivery" means the meter vault connection to the District's side of the Meter installed by the District in accordance with Section 3.01 of this Agreement. "Rate of Use Charge" means the charge determined for the Maximum Day Demand in excess of Average Daily Use and the Maximum Hour Demand in excess of Maximum Day Demand rates of use. "Raw Water Charge" means the rate per 1,000 gallons for out-of-district raw water charged to the City by the Tarrant Regional Water District, as such rate may be adjusted, plus eight percent (8%) of said rate, representing the City's system losses of four percent (4%), and the street rental charge of 4%. 786165_3 JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page 3 "System Cost" means the operating expense and capital related cost incurred by the City pursuant to the provision of water treatment and transmission to the wholesale class of water customers. Such costs are to be collected by the City as a component of the annual cost of providing wholesale water service. "TCEQ"means the Texas Commission on Environmental Quality or its successor state agency. "Treatment, Pumping and Transmission Charge" means that part of the rate charged for 1,000 gallons used, regardless of rate of use. This charge shall include the maintenance and operation costs and the capital facilities cost on the part of the production and transmission system related to annual use. "Volume Charge" means the combined Treatment, Pumping and Transmission Charge and the Raw Water Charge. ARTICLE III WATER SUPPLY, USE AND STORAGE 3.01 Supply of Treated Water. The City agrees to furnish and sell to the District treated water of potable quality meeting all applicable governmental standards, delivered under the normal operating pressure prevailing in the Fort Worth System at the Point of Delivery. The District agrees to accept delivery under the conditions of this Agreement and to pay for such water in accordance with the terms herein. The District's sole connection to the Fort Worth System shall be at the Point of Delivery, which shall be located adjacent to Floyd Hampton Road on the western boundary of the Development as shown on Exhibit C. 3.02 Sale and Use Within Development Only. The District may not sell or transfer any water furnished by the City under this Agreement to any connections outside the Development or for any use outside of the Development. The City is under no obligation to sell or otherwise deliver any treated water to the District except pursuant to all of the terms and conditions this Agreement 3.03 Backflow Prevention. Prior to the delivery of any water by the City pursuant to this Agreement, the District, at its sole expense, shall install a backflow prevention device commensurate with the degree of hazard as specified by the TCEQ immediately after the Meter on the District's side, as reflected in Exhibit C. The District, at its sole expense, shall maintain the backflow prevention device in accordance with TCEQ and City standards. 3.04 Tarrant Regional Water District Contract. In accordance with the terms of City Secretary Contract No. 12720 between the City, City of Arlington, City of Mansfield, Trinity River Authority and the Tarrant County Water Control and Improvement District No. 1, a water control and improvement district created under authority of Article XVI, Sec. 59 of the Texas Constitution, now known as the Tarrant Regional Water District, this Agreement shall be deemed subordinate in all respects to the water requirements of the contracting parties as specified in Section 3 of that Contract No. 12720. 786165_3 JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page 4 3.05 Conservation. If the City shall ration the use of water throughout its corporate limits or issue water conservation measures or restrict the use of water in any way, the City shall notify the District, which shall immediately impose and enforce the same rationing, conservation measures, or restrictions to the use of water within the Development. ARTICLE IV METER AND METERING FACILITIES 4.01 Construction and Title. All water furnished by the City under this Agreement shall be measured by an eight inch (8") Meter equipped with continuous flow, chart-recording devices, and telemetering equipment connected with the City's control center. The District shall construct and install or cause to be constructed and installed the Meter, Metering Facilities and appurtenances. All construction shall be in accordance with plans and specifications meeting City standards and shall be approved by the City in writing prior to the commencement of construction. Upon acceptance of the Meter, Metering Facilities and appurtenances, the City shall own and have title to such equipment, along with the exclusive right to use, operate and maintain such equipment. 4.02 Operation and Maintenance. Upon acceptance of the Meter, Metering Facilities and appurtenances, the City shall pay all costs associated with the operation and maintenance of such equipment and shall pay for the repair and replacement of such equipment as necessary, excluding upsizing of the Meter. Such costs, as well as charges for repair and replacement of the telelink line and microwave transmitter and the power to operate same, shall be a System Cost. The Meter will be properly sealed, and the seal shall not be broken unless representatives of both Parties have been notified and given a reasonable opportunity to be present. 4.03 Service and Calibration. City shall test for accuracy, and service and calibrate if necessary, the Meter no less than once during each twelve (12) month period. Copies of the results of such calibration and all related information shall be provided to the District. 4.04 Access to Facilities. The District shall have access to the Meter and Metering Facilities at all reasonable times; provided, however, that any reading, calibration or adjustment to such equipment shall be done by employees or agents of City, or other mutually approved third party calibration agent, in the presence of representatives of the District and City, if so requested by the District. The City shall notify the District at least seventy-two (72) hours in advance of the date and time for any calibration and the District may observe the calibration. 4.05 Corrections. Upon any calibration, if it is determined that the accuracy envelope of the Meter is found to be lower than ninety-five percent (95%) or higher than one hundred five percent (105%) expressed as a percentage of the full scale of the Meter, the registration of the flow as determined by the defective Meter shall be corrected for a period extending back to the time such inaccuracy began, if such time is ascertainable; or, if such time is not ascertainable, then for a period extending back one-half (1/2) of the time elapsed since the date of the last calibration, but in no event further back than a period of six (6) months. � �l� Vau, "urI Av 786165_3 JOHNSON COUNTY SPECIAL UTILITY DISTRICT �� WATER SUPPLY CONTRACT Page 5 4.06 Out of Service Meter. If the Meter used to determine the flow of treated water to the District is out of service or out of repair so that the amount of water metered cannot be ascertained or computed from the reading thereof, the water delivered during the period the Meter is out of service or out of repair shall be estimated upon the extrapolation of past patterns of flow for that Meter location under similar conditions. ARTICLE V METER READING, BILLING AND PAYMENT 5.01 Meter Readiniz and Access. The City will read the Meter at monthly intervals. The City and the District shall have free access to read the Meter daily, if either so desires. It shall be the duty of City and the District to give immediate Notice, each to the other, should the Meter or Metering Facilities be found not functioning properly and, upon such Notice, the City shall promptly repair such equipment. 5.02 Access to Records. The City will maintain all data obtained from Meter readings in its usual and customary manner. The District shall have access to such records during reasonable business hours and shall be furnished with monthly readings for the Meter. 5.03 Billing. The City shall render bills for water service to the District monthly. All such bills shall be due and payable by the District not more than thirty (30) days from the billing date. The bills will show current charges, as well as past-due charges, if any. Past-due charges shall be the total amount unpaid from all prior billings as of the current billing date. Payments received by the City shall first be applied to the past-due charges,if any,and thereafter to the current charges. A review of water usage amounts by the District for the past twelve (12) months shall be made during the presentation of the October bill each year. The October statements shall be prepared so as to reflect any and all Rate of Use Charges that have not been previously billed and paid. A copy of the rate of flow charts or other records showing the Maximum Day Demand and the Peak Hour Rate of the year shall be furnished to the District with the October billing. 5.04 Disputes. If the District disputes a bill and is unable to resolve the difference informally, the District shall notify the Director in writing. The Director and the District shall use their best efforts to resolve the disputed bill; however, dispute of a bill is not grounds for non- payment. In the event a payment is not paid as specified in this Agreement, a finance charge of ten percent (10%) per annum will be calculated from the date that the payment was required to be made. The District shall be reimbursed by the City for any payments determined to be overpayments. ARTICLE VI OWNERSHIP,LIABILITY AND INDEMNIFICATION 6.01 Water Quality, Additional Water Sources. The City shall deliver water that meets all state and federal water quality requirements to the Point of Delivery. If the District obtains water for use within the Development from any source other than the City, the City makes no representation that the treated water to be delivered to the District will properly mix with water that the District obtains from other sources. The District assumes all responsibility and liability 786165_3 JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page 6 for any combining or mixing of water delivered by the City that is combined or mixed with water from any other District sources. The City's sole responsibility is to provide the District with water of a quality that meets state and federal drinking water standards at the Point of Delivery. From the Point of Delivery on, the District is solely responsible for meeting state and federal drinking water quality standards. The District shall notify the Director in writing before obtaining water for the Development from any source other than the City. 6.02 Liability and Ownership. Ownership of and liability for the water shall remain with the City until the water passes through the Point of Delivery. The District assumes all liability and responsibility for, together with ownership of, the water after it passes through the Point of Delivery, including but not limited to liability for mixing, transportation and quality of water. In addition, repair and maintenance of the Customer System shall be the District's responsibility and the City has no liability or responsibility for maintenance and operation of the Customer System. No provision of this Agreement shall be construed to create any type of joint or equity ownership of any property or any partnership or joint venture, and the District's payments (whether past, present, or future) shall not be construed as granting the District partial ownership of, pre-paid capacity in, or equity in the Fort Worth System. 6.03 Indemnity by District. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DISTRICT AGREES TO INDEMNIFY AND DEFEND THE CITY, ITS OFFICERS, ELECTED OFFICIALS, EMPLOYEES, AGENTS, ATTORNEYS, CONSULTANTS, CONTRACTORS, SUCCESSORS AND ASSIGNS (COLLECTIVELY, `INDEMNITEES") WITH REGARD TO ANY AND ALL CLAIMS, LOSSES, DAMAGES, LIABILITIES, LIENS, FINES, SUITS, JUDGMENTS, ADMINISTRATIVE PROCEEDINGS, REMEDIATION OR CORRECTIVE ACTION REQUIREMENTS, ENFORCEMENT ACTIONS,AND ALL COSTS AND EXPENSES INCURRED IN CONNECTION THEREWITH(INCLUDING, BUT NOT LIMITED TO, ATTORNEYS' FEES, COSTS OF INVESTIGATION AND EXPENSES, INCLUDING THOSE INCURRED BY CITY IN ENFORCING THIS INDEMNITY), DIRECTLY ARISING OUT OF, CAUSED BY OR RESULTING FROM (IN WHOLE OR IN PART) ANY BREACH OF THIS AGREEMENT BY THE DISTRICT,ITS OFFICERS,EMPLOYEES AND AGENTS OR ANY CONNECTION OF THE CUSTOMER SYSTEM TO THE FORT WORTH SYSTEM(COLLECTIVELY,"LIABILITIES"). 6.04 Indemnityby City. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE CITY AGREES TO INDEMNIFY AND DEFEND THE DISTRICT, ITS OFFICERS, ELECTED OFFICIALS, EMPLOYEES, AGENTS, ATTORNEYS, CONSULTANTS, CONTRACTORS, SUCCESSORS AND ASSIGNS (COLLECTIVELY, "INDEMNITEES") WITH REGARD TO ANY AND ALL CLAIMS, LOSSES, DAMAGES, LIABILITIES, LIENS, FINES, SUITS, JUDGMENTS, ADMINISTRATIVE PROCEEDINGS, REMEDIATION OR CORRECTIVE ACTION REQUIREMENTS, ENFORCEMENT ACTIONS,AND ALL COSTS AND EXPENSES INCURRED IN CONNECTION THEREWITH(INCLUDING, BUT NOT LIMITED TO, ATTORNEYS' FEES, COSTS OF INVESTIGATION AND EXPENSES, INCLUDING THOSE INCURRED BY THE DISTRICT IN ENFORCING THIS INDEMNITY), DIRECTLY ARISING OUT OF, CAUSED BY OR RESULTING FROM (IN WHOLE OR IN PART) ANY BREACH OF THIS AGREEMENT BY THE CITY, ITS OFFICERS, EMPLOYEES AND AGENTS (COLLECTIVELY, "LIABILITIES"). 786165_3 JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page 7 ARTICLE VII REPORTS AND AUDIT 7.01 Required Records. The District shall provide the following data to the City upon 30 days Notice: A. Actual number of customer accounts within the Development consuming directly or indirectly from the Customer System; B. Classification of domestic and nondomestic accounts within the Development by number and percentage of accounts consuming directly or indirectly from Customer System; and C. The District's water usage within the Development from all sources other than the Fort Worth System, including, but not limited to, ground water, other surface water,and water supply agreements with other entities. 7.02 Inspection and Audit. The City and the District shall maintain all records and accounts related to this Agreement for a period of five (5) years. Each Party shall at all times, upon Notice, have the right at reasonable times to examine and inspect said records and accounts during normal business hours; and further, if required by any law, rule or regulation, make said records and accounts available to federal and/or state auditors. ARTICLE VIII RATES AND CHARGES 8.01 Rates Charted Pursuant to this Agreement. The Parties agree that the rates charged pursuant to this Agreement will be calculated using the methodology set forth in this Article VIII, which also serves as the basis for the wholesale water rates that the City charges to each municipality that is a wholesale water customer of the City, pursuant to each of their separate contracts. The majority of the City's contracts with its municipal wholesale customers will expire in 2010 and the City expects to enter into negotiations for new wholesale contracts("New Contracts") with such customers. If the New Contracts include a rate methodology("New MethodoloQy")that differs from that contained herein,then at the time that five or more of such New Contracts are fully executed, the District and the City expressly understand and agree that the rate methodology described herein will be automatically superceded and replaced to adopt the New Methodology contained in the New Contracts used to calculate the rates for those wholesale customers of the City who are municipalities, and such will then be used to calculate rates charged pursuant to this Agreement. 8.02 Cost of Service Studies. Wholesale water rates will be based upon cost-of-service rate studies performed by independent utility rate consultants. The independent utility rate consultant shall be selected by the Director from a list of five qualified firms submitted to the Director by the Fort Worth Water System Advisory Committee. The cost of such studies shall be a System Cost. All cost-of-service studies shall be conducted utilizing the utility cost basis of 786165_3 JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page 8 determining revenue requirements applicable to the wholesale customer class. A detailed wholesale cost-of-service water rate study was performed for the Fiscal Year beginning October 1, 2005. An additional detailed wholesale cost-of-service water rate study will be performed for the Fiscal Year beginning October 1, 2008, using the same methodology of the previous rate study. In the Fiscal Years between detailed rate studies, the City will perform a wholesale water rate study using the same methodology as the last detailed rate study, and will utilize the actual operating data for the twelve month period ending September 30th of the prior year, adjusted for all known and measurable changes in cost data that may have occurred since the last audited financial statement. Such adjustments should allow for year-end trending and the spreading of non-recurring expenses over an appropriate benefit period. 8.03 Allocation and Distribution of Cost. The cost-of-service for the wholesale class shall include allocated reasonable and necessary operation and maintenance expense, depreciation expense and a fair and reasonable return on allocated capital facilities. To determine the allocation and distribution of costs to the wholesale customer class,the independent utility rate consultant shall consider at least the following factors: total volume, rate of flow, metering, and customer-related costs such as accounting, billing, and monitoring. The Capital-related costs will consist of depreciation expense and return on original cost rate base. The rate base shall consist of all allocated capital facilities, net of depreciation and contributions, and shall include construction work in progress, a reasonable allowance for working capital, and a reasonable inventory of materials and supplies necessary for the efficient operation of the Fort Worth System. Records of the original cost and the accumulated depreciation of all capital facilities shall be maintained in the Fort Worth Fixed Asset Tracking System. These records shall be available for inspection at the City's Water Department during reasonable business hours upon request by the District. 8.04 Rate of Return. The City shall be allowed an adequate opportunity to earn a reasonable rate of return. The return shall be sufficient to assure confidence in the financial soundness of the City's utility, shall be adequate to maintain and support its credit, shall enable it to raise the money necessary for the proper discharge of its public duties, and shall be equal to the weighted average imbedded cost of outstanding debt plus one and one-half percent(1-1/2%). 8.05 Initial Rate. The initial rates for this Agreement shall be those adopted by the City Council and effective on October 1, 2005,which are as follows: Treatment, Pumping and $0.6829 per 1,000 gallons Transmission Charge withdrawn by the District Raw Water Charge $0.6775 per 1,000 gallons Annual charge per MGD of $104,348 per MGD Maximum Day Demand in excess of Average Daily Use 786165_3 JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page 9 Maximum Hour Demand in excess $27,043 per MGD of the Maximum Day Demand Service Charge $25.00 per month per meter 8.06 Raw Water Charge. The Raw Water Charge shall be equal to the rate per 1,000 gallons for out-of-district raw water charged to the City by the Tarrant Regional Water District, plus eight percent (8%) of said rate, representing the City's system losses of four percent (4%) and the street rental charge of four percent (4%), and shall be charged for the amount of water furnished by the City at the Point of Delivery. Adjustments to the Raw Water Charge shall be made whenever the Tarrant Regional Water District adjusts the rate per 1,000 gallons charged to the City. 8.07 Annual Payment. The annual payment to the City for water used by the District will be computed based on all water delivered by the City to the District during the current Fiscal Year using rates charged pursuant to this Agreement. For purposes of calculating the annual payment, the current year will be the Fiscal Year during which the water usage occurred. However, the minimum annual payment will be the greater of the following: (a) The charges calculated by applying the current Volume Charge to Annual Consumption, the appropriate Meter reading and billing charge, and the Rate of Use Charge for the current Fiscal Year; or (b) The current Fiscal Year Volume Charge, the appropriate Meter reading and billing charge, and the current Fiscal Year Rate of Use Charge applied to the average of the Maximum Day Demand above Average Daily Use and the average of the Maximum Hour Demand above Maximum Day Demand for the most recently completed three Fiscal Years. The most recently completed three Fiscal Years will include the current Fiscal Year; or (c) Twelve thousand dollars ($12,000). The total annual payment for water by the District shall be related to the annual and peak volumes used by the District during the Fiscal Year, as determined by meters, flow recording devices or other approved methods, subject to the annual payment provisions set forth above. The October bill for September usage shall reflect any necessary adjustment to the annual payment due to actual rates of withdrawal from the Fort Worth System. 786165_3 JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page 10 Example: The rate used in the example is based on the District not being in Tarrant Regional Water District and water being withdrawn at one metering station, and the Volume Charge and Rate of Use Charges in effect until September 30,2006. Usage Monthly Rate Service Month Consumption Volume of Use Charge Total Oct. 1,000,000 $1,359.40 $1,687.35 $25 $ 3,071.75 Nov. 1,000,000 1,359.40 1,687.35 25 3,071.75 Dec. 1,000,000 1,359.40 1,687.35 25 3,071.75 Jan. 1,000,000 1,359.40 1,687.35 25 3,071.75 Feb. 1,000,000 1,359.40 1,687.35 25 3,071.75 March 2,000,000 2,718.80 1,687.35 25 4,431.15 April 3,000,000 4,078.20 1,687.35 25 5,790.55 May 3,000,000 4,078.20 1,687.35 25 5,790.55 June 3,000,000 4,078.20 1,687.35 25 5,790.55 July 3,000,000 4,078.20 1,687.35 25 5,790.55 August 4,000,000 5,437.60 1,687.35 25 7,149.95 Subtotal 23,000,000 $31,266.20 $8,560.85 $275 50,102.05 Sept. 3,000,000 4,078.20 3,532.93 25 7,636.13 26,000,000 $35,344.40 $22,093.78 $300 $57,738.18 Prior Year Rate of Use Calculation(for use in estimated monthly Rate of Use Charge) Average Daily Use for the prior year = 60,000 gallons Maximum Day Demand for the prior year = 175,000 gallons Maximum Hour Demand for the prior year = 480,000 gallons Maximum Day Demand above Average Daily Use = 115,000 gallons Maximum Hour Demand above Maximum Day Demand = 305,000 gallons Monthly Excess Maximum Day and Hour Payment Calculation .115 mg X $104,348 = $12,000.02 (Maximum day) .305 mg X $27,043 = 8,248.12 (Maximum hour) Total $20,248.14 Monthly Rate of Use Payment(Total Divided by 12)=$1,687.35 A. The annual payment calculation will be computed on the basis of the current year maximum usage rates or the average of the maximum usage rates of the most recent three Fiscal Years, whichever is greater. In Example A, the current year exceeds the average of the most recent three Fiscal Years. 786165_3 JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page 11 Current Year Rate Of Use Calculation Average Daily Use for the year = 71,233 gallons Maximum Day Demand for the current year = 200,000 gallons Maximum Hour Demand for the current year = 520,000 gallons Maximum Day Demand above Average Daily Use = 128,767 gallons Maximum Hour Demand above Maximum Day Demand = 320,000 gallons Fiscal Year Average of Most Recent Three Years CURRENT FY FY FY 2005 2004 Maximum Day Demand above Average Daily Use 128,767 115,000 130,000 Maximum Hour Demand above Maximum Day Demand 320,000 305,000 325,000 Three year average of Maximum Day Demand above Average Daily Use 124,589 Three year average of Maximum Hour Demand above Maximum Day Demand 316,667 The District's annual payment will be based on the greater of the current year maximum usage rates or the average of the maximum usage rates of the most recent three Fiscal Years. Annual Payment Calculation FY 2006 Rates (Based on Current Year Data) 26,000 X $ 1.3594 $35,344.40 .1288 mg X $104,348 13,440.02 .3200 mg X $27,043 8,653.76 12X 1 X$25 300.00 Total Annual Payment $57,738.18 Previous Billings for October through August Usage 50,102.05 October Billing for September Usage $ 7,636.13 B. Example of computation when the average of the maximum usage rates of the most recent three Fiscal Years is greater than the current Fiscal Year rate of use: 786165_3 JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page 12 Current Year Rate of Use Calculation Average Daily Use for the current year = 71,233 gallons Maximum Day Demand for the current year = 200,000 gallons Maximum Hour Demand for the current year = 520,000 gallons Maximum Day Demand above Average Daily Use = 128,767 gallons Maximum Hour Demand above Maximum Day Demand = 320,000 gallons Fiscal Year Average of Most Recent Three Years CURRENT FY FY FY 2005 2004 Maximum Day Demand above Average Daily Use 128,767 130,234 130,000 Maximum Hour Demand above Maximum Day Demand 320,000 323,010 325,000 Three year average of Maximum Day Demand above Average Daily Use 129,667 Three year average of Maximum Hour Demand above Maximum Day Demand 322,670 The District's annual payment will be based on the greater of the current Fiscal Year maximum usage rates or the average of the maximum usage rates of the most recent three Fiscal Years. Annual Payment Calculation FY 2006 Rates (Based on average of most recent three years) 26,000 X $1.3594 $35,344.40 .1297 mg X $104,348 13,533.94 .3227 mg X $27,043 8,726.78 12 X 1 X$25 300.00 Total Annual Payment $ 57,905.12 Previous Billings for October through August Usage 50,102.05 October Billing for September Usage $7,803.07 8.08 Monthly Payment. Except as provided for in Section 8.09 below, the monthly payment will be the greater of either one thousand dollars ($1,000) or a sum equal to the Volume Charge for the actual volume of water taken plus one twelfth(1/12)of the sum of the estimated Rate of Use Charges and the appropriate Fiscal Year charges for meter reading and billing. For purposes of estimating the rate of use payments, the current Fiscal Year Rate of Use Charges will be applied to the prior Fiscal Year's Maximum Day Demand, Maximum Hour Demand and Av aga Dail), CITY NU21 X11%u's� 786165_3 pppq ea•,^n a JOHNSON COUNTY SPECIAL UTILITY DISTRICT 7 . ''OINK,K, 1210 WATER SUPPLY CONTRACT PRoe 13 8.09 Adjustment of Rates. The District agrees that the City shall have the right to unilaterally adjust the rates charged for the water services provided pursuant to this Agreement, from time to time, so long as the adjustment is based on the agreed methodology set forth in this Agreement and in effect pursuant to Section 8.01,and otherwise in compliance with this Agreement and the rate is equal to the rate charged by the City to its municipal wholesale customers. The District's agreement that the City has the right to unilaterally adjust the rates charged pursuant to this Agreement is an essential part of the consideration given by the District in exchange for the City's entering into this Agreement to provide wholesale water service to the Development. , and without which consideration the City would not have provided wholesale water service to the District, either by entering into this Agreement or otherwise. 8.10 Minimum Revenue Collection. The District agrees, throughout the term of this Agreement,to fix and collect such rates and charges for water service to be supplied as will produce revenues in an amount equal to at least all of its operation and maintenance expenses of the Customer System, including specifically its payments and obligations under this Agreement. ARTICLE IX IMPACT FEES 9.01 Initiation of Fees. At such time as the District installs water meters to provide service to the Development pursuant to this Agreement, the District shall be responsible for paying to the City all Impact Fees for each new or enlarged water connection within the Development, based upon the size of the water meter. 9.02 Quarterly Payments. Payments of Impact Fees under this Article IX shall be sent to the City within 30 days of the close of each quarter of the year, beginning with the quarter ending September 30, 2006. Such quarterly payments shall include Impact Fees for each new or enlarged connection for water for which application has been made within the Development during the preceding quarter of the year, except for the first payment which may be for more less than one quarter. 9.03 Reporting Requirements. The District shall provide the City with such information that relates to the making of new or enlarged connections within the Development as may be requested by the Director, including information required to be provided by this Agreement. 9.04 Audit. On an annual basis, City has the right to audit any records of the District that relate to new and enlarged connections. 9.05 Use of Impact Fees. City shall use all impact fees only in accordance with Chapter 395, Texas Local Government Code. 9.06 Commencement of Service. The District shall not commence water service to any customer within the Development until such customer provides the District with a receipt evidencing proof of payment of wastewater impact fees to the City. 786165_3 JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page 14 ARTICLE X TERM AND RELATED PROVISIONS 10.01 Term of Agreement. This Agreement shall be for a term of at least ten years from the Effective Date, unless terminated by mutual agreement or for cause pursuant to Section 10.03. The City has the right at any time between July 18, 2015 and July 18, 2021, to exercise the option to buy the water distribution system for the Development from the District, pursuant to Article XII and the Buy-Out Option Contract attached as Exhibit D; provided, however, the closing shall not occur prior to July 18, 2016. If, by July 18, 2016, the City has not exercised the buy-out option or given the District at least one year's written Notice that it will not exercise the buy-out option, this Agreement will automatically be extended and will terminate on the first to occur of. (i) the effective date of the City's purchase of the water distribution system for the Development from the District; (ii) one year after the City sends Notice to the District that it will not exercise the buy-out option; (iii) or July 18, 2022. 10.02 Effective Date. This Agreement, together with all terms and conditions and covenants, shall be effective July 18, 2006. 10.03 Termination. This Agreement may be terminated in whole or in part by the mutual consent of the District and the City, and the Agreement shall terminate on any such mutually agreed date. Further, notwithstanding anything contained herein to the contrary, any material breach by the District in the performance of any of the duties or the obligations assumed by it hereunder, or to faithfully keep and perform any of the terms, conditions and provisions hereof, shall be cause for termination of this Agreement by the City in the manner set forth in this Section 10.03. If the District commits a material breach, then, except as provided in Sections 10.04, 10.05 and 10.06, the City shall deliver to the District ninety (90) days Notice of its intention to terminate this Agreement, including in such Notice a reasonable description of the breach. If within said ninety (90) days the District fails or refuses to cure such material breach to the City's satisfaction, the City shall have the right, with one (1) year additional advance Notice to the District, to declare this Agreement terminated, and the Agreement will immediately expire at the end of such Notice period. The City shall give Notice to the District immediately upon acceptance of the cure of any breach. A material breach of this Agreement includes, but is not limited to: (a) Failure to pay any bill, charge or fee as provided for in this Agreement; (b) Making any connection to the Fort Worth System at any point except the Point of Delivery; (c) Failure to provide City ingress and egress for purposes of operation and maintenance of any Metering Facility; and (d) Failure to comply with Section 4.01 786165_3 JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page 15 10.04 Failure to Impose Conservation Measures. If the City rations the use of water throughout its corporate limits, issues water conservation measures or restricts the use of water in any way pursuant to Section 3.05, and the District fails or refuses to impose and enforce the same rationing, conservation measures or restrictions within the Development, unless supplemented by the District's own water system, the District shall be in material breach of this Agreement. The 90-day Notice provision contained in Section 10.03 shall not apply and the Director, in his or her sole discretion, shall provide Notice to the District of the deadline for curing such breach. If the District fails or refuses to cure such breach within the stated time, the City shall have the right, with nine (9) months additional advance Notice to the District, to declare this Agreement terminated, and the Agreement will immediately expire at the end of such Notice period, notwithstanding the expiration or rescission of the rationing, conservation measures or restrictions during such six-month period. The City shall give Notice to the District immediately upon acceptance of the cure of any breach. 10.05 Failure to Prevent Backflow. The Notice and cure provisions set out in Section 10.03 do not apply to a breach of Section 3.03. The City shall have the right to terminate this Agreement without further Notice if the District commits a breach of Section 3.03 and fails to cure such breach after reasonable Notice and opportunity to cure. 10.06 Successive Breaches of the Same Provision. Irrespective of whether a breach hereof is a material breach or a non-material breach, and irrespective of any cure of such breach, a second breach of the same shall entitle the City, after one (1) year Notice to the District, to declare this Agreement terminated, and this Agreement shall immediately expire at the end of such Notice period. 10.07 Effect of Termination. In event of termination of this Agreement pursuant to this Article X, except to the extent provided in Section 10.08, all rights, powers, and privileges of the District hereunder shall cease and immediately terminate upon the expiration date. 10.08 Surviving Provisions. As part of, or in addition to, survival rights to which the Parties may be entitled in law or equity, the following provisions shall survive following termination or expiration of this Agreement for any reason: (a) any payment obligation of any Party under the terms of this Agreement up to the date of termination; (b) Section 6.03 (Indemnity) (c) Article VII (Reports and Audit); (d) Article XI (Construction, Operation and Maintenance of Infrastructure ); and (e) Article XIII (Miscellaneous). ARTICLE XI CONSTRUCTION, OPERATION AND MAINTENANCE OF INFRASTRUCTURE 11.01 Infrastructure Standards. All Infrastructure shall be constructed in compliance with this Article XI and: (1) the City Utility Standards including standards for fire hydrants, except for water meters which may be constructed in accordance with District standards; (2) rules and regulations of the TCEQ; and (3) rules and regulations, if any, of the District ("Infrastructure Standards"). 786165_3 JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page 16 11.02 Conflicts. In the event of any conflict between the City Utility Standards and any other standards, rules, or regulations listed above, the City Utility Standards shall control unless otherwise agreed in writing by the Director. 11.03 Additional Construction Standards for Water Utility Infrastructure. The water utility Infrastructure serving the Development must be constructed using the same type, or a compatible type, of meters, valves, meter boxes and service lines used by the City for its municipal water system; provided, however, that automated meter reading ("AMR")-compatible may be used. 11.04 Plan Review by City_. Construction shall not begin until the plans and specifications have been reviewed and approved by the City and any applicable City Review Fees have been paid. 11.05 Inspections. The District shall inspect the Infrastructure to ensure the Infrastructure is constructed in compliance with Section 11.01. The District shall notify the Infrastructure Review Section in the City's Department of Engineering at least three (3) business days before final inspection of the Infrastructure. The City has the right, but not the obligation, to inspect and test the Infrastructure at any time and to be present at the final inspection. 11.06 Operation and Maintenance of Infrastructure. The District shall cause all Infrastructure, once it is constructed, to be operated and maintained in compliance with the Infrastructure Standards. 11.07 As-Built Drawinjzs. The District shall be responsible for the delivery of as-built drawings for all Infrastructure to the City's Engineering Department within 30 days after final inspection. ARTICLE XII CERTIFICATE OF CONVENIENCE AND NECESSITY; PURCHASE OF FACILITIES Pursuant to Certificate of Convenience and Necessity No. 10081, the District has the right and obligation to provide retail water service to the Development. The City may, in its sole discretion, seek to become the certificated provider of retail water service to the Development at any time between July 18, 2016 and July 18, 2021. To effectuate any transfer of retail water service from the District to the City, the Parties will execute the Buy-out Option Contract attached hereto as Exhibit D, pursuant to which the District agrees to the transfer of water service rights to the City and further agrees to convey the Development's water distribution system to the City upon City's exercise of the buy-out option. The District agrees not to contest any applications filed by the City at the TCEQ for a new or amended water certificate of convenience and necessity to effectuate the transfer of retail water service rights to the Development. The District shall cooperate and assist the City to the extent reasonably necessary in obtaining any regulatory approvals required to effectuate such transfer of water utility service rights from the District to the City. 786165_3 JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page 17 ARTICLE XIII MISCELLANEOUS 13.01 Governing Law, Jurisdiction and Venue. THIS AGREEMENT MUST BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, AS THEY APPLY TO CONTRACTS PERFORMED WITHIN THE STATE OF TEXAS AND WITHOUT REGARD TO ANY CHOICE OF LAW RULES OR PRINCIPLES TO THE CONTRARY. THE PARTIES ACKNOWLEDGE THAT THIS AGREEMENT IS PERFORMABLE IN TARRANT COUNTY, TEXAS AND HEREBY SUBMIT TO THE JURISDICTION OF THE COURTS OF TARRANT COUNTY, AND HEREBY AGREE THAT ANY SUCH COURT SHALL BE A PROPER FORUM FOR THE DETERMINATION OF ANY DISPUTE ARISING HEREUNDER. 13.02 Notice. Any notices, approvals, or other communications required to be given by one Party to another under this Agreement(a "Notice") shall be given in writing addressed to the Party to be notified at the address set forth below and shall be deemed given: (a) when the Notice is delivered in person to the person to whose attention the Notice is addressed; (b) when received if the Notice is deposited in the United States Mail, certified or registered mail, return receipt requested, postage prepaid; (c) when the Notice is delivered by Federal Express, UPS, or another nationally recognized courier service with evidence of delivery signed by any person at the delivery address; or (d) five business days after the Notice is sent by FAX (with electronic confirmation by the sending FAX machine) with a confirming copy sent by United States mail within 48 hours after the FAX is sent. If any date or period provided in this Agreement ends on a Saturday, Sunday, or legal holiday, the applicable period for calculating the Notice shall be extended to the first business day following the Saturday, Sunday, or legal holiday. For the purpose of giving any Notice, the addresses of the Parties are set forth below. The Parties may change the information set forth below by sending Notice of such changes to the other Party as provided in this section. To the City: City of Fort Worth, Texas 1000 Throckmorton Street Attn: City Secretary Fort Worth, Texas 76102 FAX: (817) 392-6196 City of Fort Worth, Texas 1000 Throckmorton Street Attn: City Manager Fort Worth, Texas 76102 FAX: (817) 392-6134 786165_3 JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page 18 City of Fort Worth, Texas 1000 Throckmorton Street Attn: Water Director Fort Worth, Texas 76102 FAX: (817) 392-2398 To the District: Johnson County Special Utility District PO Box 509 Attn: General Manager Cleburne,TX 76033 FAX: (817) 641-6916 13.03 City Consent and Approval. In any provision of this Agreement that provides for the consent or approval of the City staff or City Council, such consent or approval may be withheld or conditioned by the staff or City Council at its sole discretion. 13.04 Consent Required for Assignment and Binding on Successors and Assigns. All of the terms of this Agreement shall be binding upon, inure to the benefit of, and be severally enforceable by and against each Party to this Agreement, individually, and such Party's respective personal representatives, successors, trustees, receivers, and assigns. However, no Party shall assign this Agreement without the written consent of each of the other Party, which consent shall not be unreasonably withheld. It is specifically intended that this Agreement and all terms, conditions and covenants herein shall survive a transfer, conveyance or assignment occasioned by the exercise of foreclosure of lien rights by a creditor or a Party hereto, whether judicial or non judicial. 13.05 Amendment. This Agreement may be amended only with approval of the governing bodies of the City and the District. 13.06 No Waiver. Any failure by a Party to insist upon strict performance by any other Party of any material provision of this Agreement shall not be deemed a waiver thereof, and the Parties shall have the right at any time thereafter to insist upon strict performance of any and all provisions of this Agreement. No provision of this Agreement may be waived except by writing signed by the Party waiving such provision. Any waiver shall be limited to the specific purposes for which it is given. No waiver by any Party hereto of any term or condition of this Agreement shall be deemed or construed to be a waiver of any other term or condition or subsequent waiver of the same term or condition. 13.07 Severability. The provisions of this Agreement are severable and, in the event any word, phrase, clause, sentence, paragraph, section, or other provision of this Agreement, or the application thereof to any person or circumstance, shall ever be held or determined to be invalid, illegal, or unenforceable for any reason, and the extent of such invalidity or unenforceability does not cause substantial deviation from the underlying intent of the Parties as expressed in this Agreement, then such provision shall be deemed severed from this Agreement 786165_3 JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page 19 with respect to such person, entity or circumstance, without invalidating the remainder of this Agreement or the application of such provision to other persons, entities or circumstances, and a new provision shall be deemed substituted in lieu of the provision so severed which new provision shall, to the extent possible, accomplish the intent of the Parties as evidenced by the provision so severed. 13.08 Captions. Captions and headings used in this Agreement are for reference purposes only and shall not be deemed a part of the Agreement. 13.09 Interpretation. The parties acknowledge that each Party and, if it so chooses, its counsel have reviewed and revised this Agreement and that the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement or any amendments or exhibits hereto. As used in this Agreement, the term "including" means "including without limitation" and the term "days" means calendar days, not business days. Wherever required by the context, the singular shall include the plural, and the plural shall include the singular. Each defined term herein may be used in its singular or plural form whether or not so defined. 13.10 Conspicuous Provisions. The Parties acknowledge that the provisions of this Agreement that are set out in bold, CAPITALS (or any combination thereof) satisfy the requirements for the express negligence rule and/or are conspicuous. 13.11 No Third Party Beneficiary. This Agreement is solely for the benefit of the Parties, and neither the City nor the District intends by any provision of this Agreement to create any rights in any third-party beneficiaries or to confer any benefit upon or enforceable rights under this Agreement or otherwise upon anyone other than the City and the District. 13.12 Force Majeure. No Party shall be considered to be in default in the performance of any of the obligations hereunder(other than obligations of either Party to pay costs and expenses) if such failure of performance shall be due to an uncontrollable force beyond the control of the Parties, including but not limited to, the failure of facilities, flood, earthquake, tornado, storm, fire, lightning, epidemic, war, riot, civil disturbance or disobedience, labor dispute, labor or material shortage, sabotage, or restraint by a court order or public authority, which by the exercise of due diligence and foresight such Party could not have reasonably been expected to avoid. Either Party rendered unable to fulfill any obligation by reason of an uncontrollable force shall exercise due diligence to remove such inability with all reasonable dispatch. In the event the proper operation of the Fort Worth System, as a result of the above, requires the City to temporarily interrupt all or part of the services to the District,no claims for damage shall be made by the District against the City. 13.13 Emer ems. During a temporary emergency condition created by unforeseeable mechanical failure or by unprecedented high rate of water usage such as might result from a major fire or a major water main break, it may be necessary that water be withdrawn from the Fort Worth System at a rate of usage in excess of that required for the Development's usual peak requirements. It is agreed that extra Rate of Use Charges that would normally be applicable shall not apply for such bona fide emergency withdrawals provided that the City is notified in writing within 48 hours 0FF1C1y� ac, °('r .Sv 786165_3 1L� JOHNSON COUNTY SPECIAL UTILITY DISTRICT U WATER SUPPLY CONTRACT age 10 J. LLA of the occurrence of an emergency condition. In any event, the Volume and Rate of Use Charges for all water delivered shall be due and payable as described elsewhere herein. 13.14 Applicable Laws. This Agreement is subject to all applicable federal and state laws and any applicable permits, amendments, orders, or regulations of any state or federal governmental authority having or asserting jurisdiction, but nothing contained herein shall be construed as a waiver of any right to question or contest any such law, order, rule or regulation in any forum having jurisdiction. 13.15 Access to Facilities. Upon prior Notice to the District by the City, any employee of the City bearing proper credentials and identification shall be given access to the Development as may be necessary for the purpose of inspections and observation,measurements, sampling and testing and/or auditing, in accordance with the provisions of this Agreement. The District may elect to accompany the City's representative. 13.16 Incorporation of Exhibits by Reference. All exhibits attached to this Agreement are incorporated into this Agreement by reference for the purposes set forth herein, as follows: Exhibit A Map of the Development Exhibit B Legal description of the Development Exhibit C Map showing the Development's Point of Delivery into the Fort Worth System, Meter, and backflow prevention device Exhibit D Buy-Out Option Contract Each Party has caused this Agreement to be executed by its duly authorized representative in multiple copies on the date or dates indicated below. r(ATTEST: CIT=H RTH kzcl�k/A By: Marty HendriA0 Marc A. Ott,Assl ant Ci ei City Secretary APPROVED AS TO FORM AND C,-aiao4 LEGALITY: Contract Authorization <�M 1� .�( AQ1 L NOU Christa L pez, Assistant ' Attomey Date ATTEST: JOHNSON COUNTY SPECIAL UTILITY DISTRICT By: t1A A I � IVI I A.,, Dist ct Se etary Terry Kelley eneral anage Office ager 786165_3 JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page 21 Exhibit A Map of the Development EXHIBIT A TO JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page I E X H I B I T A I lm MUM o I I _ � I I t2: a � I e� --p Z s Exhibit B Legal Description of the Development Being a 194.044 acre tract in the J. Armendaris Survey, Abstract No. 1767, the U. Mendoza Survey, Abstract No. 994 and the Pinckney Caldwell Survey, Abstract No. 363, Tarrant County, Texas and being a westerly portion of that 332.896 acre tract of land described in a deed to Tlh Realty Investments Ltd. and recorded in Volume 13229, Page 60, Deed Records, Tarrant County, Texas. Said 194.044 acre tract is more particularly described as follows: Beginning at a highway monument found at the northwest corner of said 332.896 acre tract, in the east line of Floyd Hampton Road and at the southwest corner of a 11.015 acre tract described in a deed to the State of Texas and recorded in Volume 12683, Page 110, said deed records; Thence easterly with the northerly line of said 332.896 acre tract and the southerly line of said 11.015 acre tract the following calls: N 45 degrees 35 minutes 31 seconds E, 70.94 feet to a highway monument found; S 89 degrees 35 minutes 25 seconds E, 355.17 feet to a highway monument found at the beginning of a compound curve to the left; 1,336.17 feet with the arc of the first part of said compound curve to the left to a highway monument found. The first part of said compound curve to the left has a radius of 5,879.58 feet, a central angle of 13 degrees 01 minute 15 seconds and a long chord which bears N 83 degrees 53 minutes 57 seconds E, 1,333.30 feet; 262.62 feet with the arc of the second part of said compound curve to the left to a highway monument found. The second part of said compound curve to the left has a radius of 1,926.86 feet, a central angle of 7 degrees 48 minutes 33 seconds and a long chord which bears N 73 degrees 29 minutes 03 seconds E, 262.42 feet; N 78 degrees 15 minutes 13 seconds E, 59.70 feet to a point in the line dividing the City of Crowley and the Extra Territorial Jurisdiction of the City of Fort Worth, described in Joint Resolutions and Agreements 1230 and 1827; Thence S 00 degrees 00 minutes 27 seconds E with the line dividing the City of Crowley and the Extra Territorial Jurisdiction of the City of Fort Worth, 4,072.16 feet to a point in the southerly line of said 332.896 acre tract; Thence with the southerly lines of said 332.896 acre tract the following calls: N 89 degrees 28 minutes 47 seconds W, 379.37 feet; S 00 degrees 25 minutes 07 seconds W 613.53 feet to a broken up concrete r r monument; EXHIBIT B TO JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page 1 N 89 degrees 45 minutes 23 seconds W, 586.85 feet to the southeast corner of a 14.999 acre tract described in a deed to Morris Daniel Jr. and Deanna Daniel and recorded in Volume 13679, Page 306, said deed records; Thence with the easterly and northerly lines of said 14.999 acre tract the following calls: N 00 degrees 22 minutes 06 seconds E, 566.53 feet; N 89 degrees 45 minutes 23 seconds W, 1,059.73 feet; N 38 degrees 55 minutes 42 seconds W, 108.78 feet to a point at the northwest corner of said 14.999 acre tract, in the westerly line of said 332.896 acre tract, in the easterly line of Floyd Hampton Road and at the beginning of a curve to the left; Thence with the westerly line of said 332.896 acre tract and the easterly line of Floyd Hampton Road the following calls: 49.10 feet with the arc of said curve to the left. Said curve has a radius of 109.40 feet, a central angle of 25 degrees 42 minutes 54 seconds and a long chord which bears N 13 degrees 39 minutes 13 seconds E, 48.69 feet; N 00 degrees 47 minutes 42 seconds E, 808.30 feet; N 00 degrees 37 minutes 18 seconds W, 400.00 feet; N 00 degrees 47 minutes 42 seconds E, 2,493.26 feet to the point of beginning and containing 194.044 acres. EXHIBIT B TO JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page 2 E X H I B I T C o o N W x a o C. w Z W� a 0 my z O K� ppI sT 5 O o�u � ei �v � a � _ \III 1` .. JilIII l \ \ Jill 141 Till ` 1 J ; �j� j o Z F fill L, Illi 1 O w�r f,r. Jill co bt cd CITY OF CROWLEY II I ! $ It I I B Jill CROWLEY CITY LIKIT LINE_ 11 CROWLEY CPfY LBUT LINE S a FOZ WORTH ETJII —� OR— T�'Lr" Ld 0 It gg $ Ilii I a Z W W " Ln U a I o I I 1or w I I 1 \ rtl1 O I r Z 11 a \ W N X11 aLi \ 3NI7 M ,Of 9NI1SIX3 3N17 M ,Of 9N(SIX3 / / 3Nf1`M „Of 3 / \ a w IU W D O I }< F a Z J JO w<;= 5_j V~i0 Z�W U 0. u a aaoum Exhibit D Buy-Out Option Contract EXHIBIT D TO JOHNSON COUNTY SPECIAL UTILITY DISTRICT WATER SUPPLY CONTRACT Page 1 BUY-OUT OPTION CONTRACT This Buy-Out Option Contract ("Contract") is entered into by and betwe6:n the City of Fort Worth, Texas (the "Cily"), a home-rule municipality located in Tarrant, Denton, and Wise Counties, Texas, and Johnson County Special Utility District, a conservation and reclamation district located in Johnson, Hill, Ellis and Tarrant Counties, Texas, created undt;r Section 59, Article XVI, Texas Constitution(the"District"). RECITALS A. The Parties to this Contract are also parties to that "Agreement for Sale of Treated Water" City Secretary Contract No. (the "Water Agreement"). B. The Water Agreement governs the provision of water service to approximately 194.044 acres owned by Clark Briscoe Development Company, a Texas limited partnership, in Tarrant County, Texas, in the City's extraterritorial jurisdiction, as shown on Exhibit A and more particularly described in Exhibit B attached to this Contract, consisting of a portion of The Bridges subdivision(the "Development"). C. Article XII of the Water Agreement provides that the Parties will enter into this Contract to effectuate the future transfer of retail water service to the Development from the District to the City, at the City's option and under the conditions set forth in that agreement. NOW THEREFORE, for and in consideration of the mutual agreements, covenants, and conditions hereinafter set forth,the Parties contract and agree as follows: ARTICLE I SELLER AND PURCHASER 1.01 "Effective Date"means the effective date of this Contract as defined in Section 6.12. 1.02 "Party" means, individually, the City or the District, and any permitted successors and assigns. 1.03 "Purchaser" means the City. 1.04 "Seller" means the Johnson County Special Utility District and any of its permitted assigns. 1.05 Other Defined Terms. Unless otherwise defined below, capitalized terms in this Contract shall have the same respective meanings as are ascribed to them in the Water Agreement. BUY-OUT OPTION CONTRACT ARTICLE II PROPERTY, GRANT AND EXERCISE OF OPTION 2.01 Grant of Option. Subject to the terms and conditions set forth in this Contract, Seller GRANTS to Purchaser an Option to purchase and accept from Seller, for the Purchase Price, all of Seller's right, title and interest in and to the Property, as it may now exist, or be acquired or constructed by Seller at any time during the Option Period, and consisting of the following: a. all water distribution facilities, including meters, above ground tanks, pump stations and other equipment, fixtures, improvements or appurtenances used to provide water service to the Development, and located inside the Development (collectively, "Water Facilities"); b. all easements and rights-of-way inside the Development associated with the Water Facilities (the "Easements"); C. any tract of land within the Development owned by Seller and in use for the operation of the Water Facilities (the"Land"); d. copies of account records and information for existing customers served by the Water Facilities (the "Account Information"); and e. surveys, plans and specifications in Seller's possession or control that relate to the Water Facilities (the "Documents"). 2.02 Propel1y. The items listed in Section 2.01 above are collectively called the "Property." 2.03 Exercise of Option. Unless the Parties agree in writing to an earlier date, Purchaser may exercise the Option at any time between June 27, 2015 and June 27, 2021 ("the Option Period"). 2.04 Exercise Notice. Whenever Purchaser desires to exercise the Option as to the Property, Purchaser must provide Notice to Seller during the Option Period ("Exercise Notice"). The date on which Purchaser sends the Exercise Notice is called the "Oution Exercise Date." 2.05 Information to Purchaser. Within thirty (30) days following the Option Exercise Date, Seller shall provide to Purchaser true and complete copies of all written information that it possesses (other than privileged communications or attorney work-product) with regard to the Property, including but not limited to: environmental studies and reports; any permits required for the Water Facilities; all agreements granting or conveying the Easements; thc; Documents; and a complete and itemized inventory of any of the Property that is not described or shown by the Documents. Seller shall have a continuing duty to supplement such information until the Closing Date. BUY-OUT OPTION CONTRACT Page 2 2.06 Prohibited Encumbrance. Seller may not enter into any agreement to sell, transfer, mortgage, lease, or grant any preferential right to purchase (including but not limited to any option, right of first refusal, or right of first negotiation) with respect to, or otherwise encumber all or any portion of,the Property before Closing ("Prohibited Encumbrance"), unless such Prohibited Encumbrance is cured and removed at or before Closing. 2.07 Memorandum of Option. Seller and Purchaser shall execute and record, in the form attached as Exhibit C to this Contract, a "Memorandum of Buy-Out Option Contract" in the Tarrant County Real Property Records within thirty (30) days after the Effectiv{; Date. ARTICLE III PURCHASE PRICE AND OPTION CONSIDERATION 3.01 Purchase Price. The City will deposit all impact fees paid to the City for water connections within the Development in a separate account and will invest such fees along with other City funds. If the Option is exercised pursuant to this Contract, the consideration ("Purchase Price") for the entirety of the Property purchased will be an amount equal to such impact fees and all interest earned by the City on such funds. On or before March 31 of each year during the term of this Agreement, the City will provide to the District an accounting of all water impact fees paid to the City during the previous fiscal year for water conn,:ctions within the Development, together with an accounting of all interest accrued thereon. 3.02 Time of Payment. The Purchase Price is payable in cash at the Closing. 3.03 Consideration. As consideration for Seller's holding the Property available for purchase during the Option Period, Purchaser has paid Seller $100 ("Independent Option Consideration"), which Seller may retain, even if this Contract is terminated. Tht: Independent Option Consideration does not apply to the Purchase Price. ARTICLE IV SURVEY,INSPECTION AND TITLE COMMITMENT 4.01 Survey during Option Period. From time to time during the Option Period, Purchaser shall have the right to obtain, at Purchaser's expense, a current, on-thy;-ground land title survey ("Survey") of all or any portion of the Property made by a duly licensed surveyor reasonably acceptable to the Seller. 4.02 Inspection during Option Period. From time to time during the Option Period, Purchaser shall have the right to obtain an inspection at Purchaser's expense, including an appraisal of real and personal property ("Inspection"), of all or any portion of the Property, for purposes of assessing the physical and operational condition of the Property. 4.03 Title Examination duringthe he Option Period. During the Option Period, Purchaser shall have the right to obtain, at Purchaser's expense, an examination of any or all of the real property records related to the Land and the Easements ("Title Commitment"), including any and all instruments constituting an exception or restriction upon the title or easement rights of Seller. BUY-OUT OPTION CONTRACT Page 3 4.04 Approval Period and Title. If Purchaser chooses to have a Survey. Inspection or Title Commitment of all or any portion of the Property during the Option Period, Purchaser may, after it has delivered its Exercise Notice, deliver to Seller a Notice of its written objections to anything contained therein. Seller shall, in good faith, attempt to satisfy such objections before Closing; but Seller shall not be required to incur any cost to do so, except with respect to any Prohibited Encumbrance, which must be removed or cured before Closing. For all objections except the Prohibited Encumbrances, if Seller is unable to satisfy such other objections on or before the Closing date, or if, for any reason, Seller is otherwise unable to convey title in accordance with Section 5.02(b) below, then Purchaser, as its sole and exclusive remedy hereunder, may (a) waive such objections and accept the Property in its condition at the time of Closing, with such title to the Property as Seller is able to convey; (b) elect to exclude from the purchase any portion of the Property that it deems to be affected by its objections and accept such title to the remainder of the Property as Seller is able to convey or(c) withdraw the Exercise Notice in its entirety, and its corresponding exercise of the Option, but preserie its right to exercise the Option at a later date within the Option Period. The Purchaser may enforce by specific performance the Seller's obligation under Section 2.06 to remove any Prohibited Encumbrance. ARTICLE V CLOSING 5.01 Time of Closing. The closing ("Closing") of the sale of the Property by Seller to Purchaser will occur on or before ninety (90) days after the Option Exercise Date, or at such other time as the Parties may mutually determine, except that in no event shall the Closing occur before June 27, 2016 ("Closing Date"). 5.02 Requirements of Seller. For all of the Property that is the subject of the Option Notice, unless excluded by Purchaser pursuant to Section 4.04, Seller shall deliver or cause to be delivered to Purchaser at Closing all of the following: (a) a Bill of Sale and Ass..gnment, fully executed and acknowledged by each Seller as its interests may appear, conveying;, transferring, and assigning to Purchaser all of Seller's right, title, and interest in and to the Water Facilities, the Account Information, and the Documents; (b) a Special Warranty Deed executed and acknowledged by Seller, conveying to Purchaser fee simple title to the Land and subject to all matters of record; (c) an Assignment of Easements, executed and acknowledged by Seller as its interests may appear, conveying, transferring, and assigning to Purchaser all of Seller's right, title, and interest in and to the Easements; (d) evidence reasonably satisfactory to :Purchaser that the person(s) executing the Closing documents on behalf of Seller has full right, power, and authority to do so; and (e) any other document reasonably necessary to consummate the transaction. 5.03 Requirements of Purchaser. Purchaser shall deliver or cause to b_- delivered to Seller at Closing the following: (a) immediately available funds in an amount equal to the Purchase Price; and (b) evidence reasonably satisfactory to Seller the person executing any Closing documents on behalf of Purchaser has full right,power, and authority to do so. BUY-OUT OPTION CONTRACT Page 4 5.04 Termination of Leases. Upon completion of the Closing, Seller shall terminate, as of the Closing Date, any and all leases and operating agreements between it and zmy third-party covering any portion of the Property purchased. 5.05 Purchaser's Remedies. If Seller fails or refuses to sell the Property at the Closing, then the Purchaser, at its sole option, is entitled to (ii) enforce specific performance of Seller's obligations under this Contract; (ii) withdraw its Exercise Notice and its corresponding exercise of the Option, but preserve its right to exercise the Option at a later date within the Option Period; or(iii) exercise any other right or remedy available to Purchaser at law or in equity. ARTICLE Vim, MISCELLANEOUS 6.01 Form of Easement within the Development. Before entering into piny Easement, Seller shall submit to Purchaser for its review and approval (which approval by Purchaser shall not be unreasonably withheld) Seller's proposed forms of Easement for water lin;,s and related facilities and appurtenances. Among other things, the Easement forms must provide that the underlying land owner of the servient tenement consents in advance to any future assignment of such Easement by Seller to Purchaser. After Purchaser has approved the forms of Easements, Purchaser's prior written consent will not be required for any new Easement that: Seller enters into under the approved forms. Nevertheless, Seller must send to Purchaser copies; of each fully executed and recorded Easement within thirty(30)days after such Easement is executed. 6.02 Other Forms. In case of a dispute as to the form of any document required by this Contract,unless otherwise required by the Agreement,the current form prepared by the State Bar of Texas shall be conclusively deemed reasonable. 6.03 Notice. Any notices, approvals, or other communications required to be given by one Party to another under this Contract (a "Notice") shall be given in writing addressed to the Party to be notified at the address set forth below and shall be deemed given: (a)when the Notice is delivered in person to the person to whose attention the Notice is addressed; (b) when received if the Notice is deposited in the United States Mail, certified or registered mail, return receipt requested, postage prepaid; (c) when the Notice is delivered by Federal Express, UI'S,or another nationally recognized courier service with evidence of delivery signed by any person at the delivery address; or (d) five business days after the Notice is sent by FAX (with electronic confirmation by the sending FAX machine) with a confirming copy sent by United States mail within 48 hours after the FAX is sent. If any date or period provided in this Contract ends on a Saturday, Sunday, or legal holiday, the applicable period for calculating the Notice shall be extended to the first business day following the Saturday, Sunday, or legal holiday. For the purpose of giving any Notice, the addresses of the Parties are set forth below. The Parties may change the information set forth below by sending Notice of such changes to the other Party as provided in this Section 6.03. BUY-OUT OPTION CONTRACT Page 5 To the City: City of Fort Worth, Texas Attn: City Secretary 1000 Throckmorton Street Fort Worth, Texas 76102 FAX: (817) 392-6196 City of Fort Worth, Texas Attn: City Manager 1000 Throckmorton Street Fort Worth, Texas 76102 FAX: (817) 392-6134 City of Fort Worth, Texas Attn: Water Director 1000 Throckmorton Street Fort Worth, Texas 76102 Fax: (817) 392-2398 To the District: Johnson County Special Utility District Attn: General Manager P. O. Box 509 Cleburne, Texas Fax: (817) 641-6916 6.04 City Consent and Approval. Except as provided by Section 6.01 of this Agreement, in any provision of this Contract that provides for the consent or approval of the City staff or City Council, such consent or approval may be withheld or conditioned by the staff or City Council at its sole discretion. 6.05 Binding Effect and Assignment. This Contract, and the Option granted herein, shall inure to the benefit of and bind the Parties hereto and their respective heirs, representatives, successors and assigns. Assignment of this Contract is permitted only under the same terms,and to the same extent as assignment of the Water Agreement. Further, this Contract must be assigned at the same time and to the same entity as the Water Agreement. 6.06 Amendment. This Contract may be amended only with the written consent of the Parties and with approval of the governing bodies of the City and the District. 6.07 Severability. The provisions of this Contract are severable. In the event any word, phrase, clause, sentence, paragraph, section, or other provision of this Contract, or the application thereof to any person or circumstance, shall ever be held or determined to be invalid, illegal, or unenforceable for any reason, and the extent of such invalidity or unenforceability does not cause substantial deviation from the underlying intent of the Parties as expressed in this BUY-OUT OPTION CONTRACT Page 6 Contract, then such provision shall be deemed severed from this Contract with respect to such person, entity or circumstance, without invalidating the remainder of this Contract or the application of such provision to other persons, entities or circumstances, and a new provision shall be deemed substituted in lieu of the provision so severed which new provision shall, to the extent possible, accomplish the intent of the Parties as evidenced by the provision so severed. 6.08 Interpretation. The Parties acknowledge that each Party and, if it so chooses, its counsel have reviewed and revised this Contract and that the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be: employed in the interpretation of this Contract or any amendments or exhibits hereto. As used in this Contract, the term "including" means "including without limitation" and the term "days" means calendar days, not business days. Wherever required by the context, the singular shall include the plural, and the plural shall include the singular. Each defined term herein may be used in its singular or plural form whether or not so defined. 6.09 Survival. Any portion of this Contract not otherwise consummated at the Closing will survive the Closing of this transaction as a continuing agreement by and between the Parties. 6.10 Counterpart Originals. This Contract may be executed in multiple counterparts, each of which shall be deemed to be an original. 6.11 Incorporation of Exhibits by Reference. All exhibits attached to this Contract are incorporated into this Contract by reference for the purposes set forth herein, as follows: Exhibit A Map of the Development Exhibit B Legal description of the Development Exhibit C Memorandum of Buy-Out Option Contract 6.12 Effective Date. The Effective Date of this Contract is July 18, 2006. SELLER ATTEST: JOHNSON COUNTY SPECIAL UTILITY DISTRICT QDis ct Seq#tary By: &"/4WVAA� Off ce M ager Terry el e G neral anage Date: BUY-OUT OPTION CONTRACT Page 7 STATE OF TEXAS § COUNTY OF § BEFORE ME, THE UNDERSIGNED AUTHORITY, on this day personally appeared Terry Kelley, general manager of Johnson County Special Utility District, known to me to be the person and officer whose name is subscribed to the foregoing instrument, and acknowledged to me that he executed the same for the purposes and consideration therein expressed, in the capacity therein stated, and as the act and deed of said district. GIVEN UNDER MY HAND AND SEAL OF OFFICE this the day of 92006. =IRELAND Public, tate of Texas ,�� Zr-� nGC Notary's Typed or Printed Name My Commission expires:�l�_ /721L— STATE OF TEXAS § COUNTY OF § BEFORE ME, THE UNDERSIGNED AUTHORITY, on this day personally appeared Marc A. Ott, assistant city manager of the City of Fort Worth, known to me to be the person and officer whose name is subscribed to the foregoing instrument, and acknowledged to me that he executed the same for the purposes and consideration therein expressed, in the capacity therein stated, and as the act and deed of said city. GIVEN UNDER MY HAND AND SEAL OF OFFICE this the day of 2006. Notary Public, State of Texas Notary's Typed or Printed Name My Commission expires: 776461_8 BUY-OUT OPTION CONTRACT Page 9 Exhibit A Map of the Development EXHIBIT A TO BUY-OUT OPTION CONTRACT Page 1 E X H I B I T A I ore JI![►OilJ I S ST I � I €rn Y I. I Z I� g Exhibit B Legal Description of the Development Being a 194.044 acre tract in the J. Armendaris Survey, Abstract No. 1767, the U. Mendoza Survey, Abstract No. 994 and the Pinckney Caldwell Survey, Abstract No. 363, Tarrant County, Texas and being a westerly portion of that 332.896 acre tract of land described in a deed to Tlh Realty Investments Ltd. and recorded in Volume 13229, Page 60, Deed Records, Ta-rant County, Texas. Said 194.044 acre tract is more particularly described as follows: Beginning at a highway monument found at the northwest corner of said 332.896 acre tract, in the east line of Floyd Hampton Road and at the southwest corner of a 11.015 acre tract described in a deed to the State of Texas and recorded in Volume 12683, Page 110, said deed records; Thence easterly with the northerly line of said 332.896 acre tract and the southerly Line of said 11.015 acre tract the following calls: N 45 degrees 35 minutes 31 seconds E, 70.94 feet to a highway monument sound; S 89 degrees 35 minutes 25 seconds E, 355.17 feet to a highway monument found at the beginning of a compound curve to the left; 1,336.17 feet with the arc of the first part of said compound curve to the left to a highway monument found. The first part of said compound curve to the left has a radius of 5,879.58 feet, a central angle of 13 degrees 01 minute 15 seconds zaid a long chord which bears N 83 degrees 53 minutes 57 seconds E, 1,333.30 feet; 262.62 feet with the arc of the second part of said compound curve to the left to a highway monument found. The second part of said compound curve to the j eft has a radius of 1,926.86 feet, a central angle of 7 degrees 48 minutes 33 seconds and a long chord which bears N 73 degrees 29 minutes 03 seconds E, 262.42 feet; N 78 degrees 15 minutes 13 seconds E, 59.70 feet to a point in the line dividing the City of Crowley and the Extra Territorial Jurisdiction of the City of Fort Worth, described in Joint Resolutions and Agreements 1230 and 1827; Thence S 00 degrees 00 minutes 27 seconds E with the line dividing the City of Crcwley and the Extra Territorial Jurisdiction of the City of Fort Worth, 4,072.16 feet to a point in the southerly line of said 332.896 acre tract; Thence with the southerly lines of said 332.896 acre tract the following calls: N 89 degrees 28 minutes 47 seconds W, 379.37 feet; S 00 degrees 25 minutes 07 seconds W, 613.53 feet to a broken up concrete monument; EXHIBIT B TO BUY-OUT OPTION CONTRACT Page 1 N 89 degrees 45 minutes 23 seconds W, 586.85 feet to the southeast corner of a 14.999 acre tract described in a deed to Morris Daniel Jr. and Deanna Daniel and recorded in Volume 13679, Page 306, said deed records; Thence with the easterly and northerly lines of said 14.999 acre tract the following calls: N 00 degrees 22 minutes 06 seconds E, 566.53 feet; N 89 degrees 45 minutes 23 seconds W, 1,059.73 feet; N 38 degrees 55 minutes 42 seconds W, 108.78 feet to a point at the northwest corner of said 14.999 acre tract, in the westerly line of said 332.896 acre tract, in the easterly line of Floyd Hampton Road and at the beginning of a curve to the left; Thence with the westerly line of said 332.896 acre tract and the easterly line of Floyd Hampton Road the following calls: 49.10 feet with the arc of said curve to the left. Said curve has a radius of 109.40 feet, a central angle of 25 degrees 42 minutes 54 seconds and a long chord which bears N 13 degrees 39 minutes 13 seconds E, 48.69 feet; N 00 degrees 47 minutes 42 seconds E, 808.30 feet; N 00 degrees 37 minutes 18 seconds W, 400.00 feet; N 00 degrees 47 minutes 42 seconds E, 2,493.26 feet to the point of beginning and containing 194.044 acres. EXHIBIT B TO BUY-OUT OPTION CONTRACT Page 2 Exhibit C Memorandum of Buy-Out Option Contract STATE OF TEXAS § § KNOW ALL BY THESE PRESENTS: COUNTY OF TARRANT § This Memorandum of Buy-Out Option Contract ("Memorandum") is ef;:ective as of July 18, 2006, by and among Johnson County Special Utility District, a special utility district created pursuant to Article XVI, Section 59, of the Texas Constitution, Chapters 49 and 65 of the Texas Water Code (collectively, "Seller") and the City Of Fort Worth, a home-rule municipality located in Tarrant, Denton, and Wise Counties, Texas ("Purchaser"). A. Under that certain Buy-Out Option Contract dated as of July 18, 2006 ("Contract"), Seller has granted Purchaser the option ("Option") to purchase certain land, improvements, easements, account records, plans, and other associated property ("Property") related to the provision of water service to, and located within, that certain real property development consisting of approximately 194.044 acres of land in Tarrant County, Texas, as more particularly described on EXHIBIT "A" attached hereto ("Development"). Purchaser may exercise the Option at any time during the period beginning on July 18, 2015 and ending on July 18, 2021. Purchaser's exercise of the Option is governed by the terms and cond.itions of the Contract. B. Seller and Purchaser are executing, acknowledging, and recording this Memorandum to provide public notice of the existence of the Contract and of the: Option that exists in Purchaser's favor to purchase the Property in the Development under the terms and conditions of the Contract. C. Seller and Purchaser do not intend by this Memorandum — and nothing in this Memorandum may be deemed—to alter, amend or otherwise affect the terms or conditions of the Contract. EXHIBIT C TO BUY-OUT OPTION CONTRACT Page 1 EFFECTIVE as of the date set forth above. SELLER ATTEST: JOHNSON COUNTY SPECIAL UTILITY DISTRICT By: (;4cSeer Terry Kelley ener anag Offi e Ma ger PURCHASER ATTEST: CITY OF FORT WORTH By: Marty Hendrix Marc A. Ott,Assistant City Manager City Secretary APPROVED AS TO FORM AND LEGALITY: Christa Lopez,Assistant City Attorney THE STATE OF TEXAS § COUNTY OF (44 § BEFORE ME, THE UNDERSIGNED AUTHORITY, on this day personally appeared Terry Kelley, general manager of Johnson County Special Utility District, known to me to be the person and officer whose name is subscribed to the foregoing instrument, and ac1clowledged to me that he executed the same for the purposes and consideration therein expressed, in the capacity therein stated, and as the act and deed of said district. GIVEN UNDER MY HAND AND SEAL OF OFFICE this day of 2006. ----,--- ^ LINDA IRE ®, Notary Pu blicNo ary Public in and or the State of Texas STATE OF M Commission expires: �/ My Comm.Exp. Y P 7��� EXHIBIT C TO BUY-OUT OPTION CONTRACT Page 2 STATE OF TEXAS § COUNTY OF TARRANT § BEFORE ME, THE UNDERSIGNED AUTHORITY, on this day personally appeared Marc A. Ott, Assistant City Manager of the City of Fort Worth, known to me to be th.- person and officer whose name is subscribed to the foregoing instrument, and acknowledged to me that he executed the same for the purposes and consideration therein expressed, in the capacity therein stated, and as the act and deed of said city. GIVEN UNDER MY HAND AND SEAL OF OFFICE this day of , 2006. Notary Public for the State of Texas Notary's Printed Name: My Commission Expires: EXHIBIT C TO BUY-OUT OPTION CONTRACT Page 3 Exhibit A Legal Description of the Development Being a 194.044 acre tract in the J. Armendaris Survey, Abstract No. 1767, the U. Mendoza Survey, Abstract No. 994 and the Pinckney Caldwell Survey, Abstract No. 363, Tarrant County, Texas and being a westerly portion of that 332.896 acre tract of land described in a deed to Tlh Realty Investments Ltd. and recorded in Volume 13229, Page 60, Deed Records, TETrant County, Texas. Said 194.044 acre tract is more particularly described as follows: Beginning at a highway monument found at the northwest corner of said 332.896 acre tract, in the east line of Floyd Hampton Road and at the southwest corner of a 11.015 acre tract described in a deed to the State of Texas and recorded in Volume 12683, Page 110, said deed records; Thence easterly with the northerly line of said 332.896 acre tract and the southerly line of said 11.015 acre tract the following calls: N 45 degrees 35 minutes 31 seconds E, 70.94 feet to a highway monument found; S 89 degrees 35 minutes 25 seconds E, 355.17 feet to a highway monument found at the beginning of a compound curve to the left; 1,336.17 feet with the arc of the first part of said compound curve to the left to a highway monument found. The first part of said compound curve to the left has a radius of 5,879.58 feet, a central angle of 13 degrees 01 minute 15 seconds and a long chord which bears N 83 degrees 53 minutes 57 seconds E, 1,333.30 feet; 262.62 feet with the arc of the second part of said compound curve to the left to a highway monument found. The second part of said compound curve to the ]eft has a radius of 1,926.86 feet, a central angle of 7 degrees 48 minutes 33 seconds and a long chord which bears N 73 degrees 29 minutes 03 seconds E, 262.4: feet; N 78 degrees 15 minutes 13 seconds E, 59.70 feet to a point in the line dividing the City of Crowley and the Extra Territorial Jurisdiction of the City of Fort Worth, described in Joint Resolutions and Agreements 1230 and 1827; Thence S 00 degrees 00 minutes 27 seconds E with the line dividing the City of Crowley and the Extra Territorial Jurisdiction of the City of Fort Worth,4,072.16 feet to a point in the southerly line of said 332.896 acre tract; Thence with the southerly lines of said 332.896 acre tract the following calls: N 89 degrees 28 minutes 47 seconds W, 379.37 feet; S 00 degrees 25 minutes 07 seconds W, 613.53 feet to a broken up concrete monument; Exhibit A to Exhibit C Buy-Out Option Contract Page 1 N 89 degrees 45 minutes 23 seconds W, 586.85 feet to the southeast corner of a 14.999 acre tract described in a deed to Morris Daniel Jr. and Deanna Daniel and recorded in Volume 13679, Page 306, said deed records; Thence with the easterly and northerly lines of said 14.999 acre tract the following calls: N 00 degrees 22 minutes 06 seconds E, 566.53 feet; N 89 degrees 45 minutes 23 seconds W, 1,059.73 feet; N 38 degrees 55 minutes 42 seconds W, 108.78 feet to a point at the northvvest corner of said 14.999 acre tract, in the westerly line of said 332.896 acre tract, in the easterly line of Floyd Hampton Road and at the beginning of a curve to the left; Thence with the westerly line of said 332.896 acre tract and the easterly line of Floyd Hampton Road the following calls: 49.10 feet with the arc of said curve to the left. Said curve has a radius of 109.40 feet, a central angle of 25 degrees 42 minutes 54 seconds and a long chord which bears N 13 degrees 39 minutes 13 seconds E,48.69 feet; N 00 degrees 47 minutes 42 seconds E, 808.30 feet; N 00 degrees 37 minutes 18 seconds W, 400.00 feet; N 00 degrees 47 minutes 42 seconds E, 2,493.26 feet to the point of beginning and containing 194.044 acres. Exhibit A to Exhibit C Buy-Out Option Contract Page 2 Page 1 of 2 City of Fort Worth, Texas Mayor and Council Communication COUNCIL ACTION: Approved on 7/11/2006 DATE: Tuesday, July 11, 2006 LOG NAME: 60BRIDGES REFERENCE NO.: C-21564 SUBJECT: Authorize Execution of Agreements with Johnson County Special Utility District and Briscoe Clark Company, Ltd. to Provide Wholesale Water Service and Retail Wastewater Service to the Bridges Subdivision in the City of Fort Worth's Extraterritorial Jurisdiction (ETJ) RECOMMENDATION: It is recommended that the City Council: 1. Authorize the City Manager to execute an agreement for the Sale of Treated Water, Sewer Service Billing Agreement and Buy-Out Option Agreement with Johnson County Special Utility District (SUD) for wholesale water service and billing of wastewater service to the Bridges Subdivision; and 2. Authorize the City Manager to execute a Community Facilities Agreement with Briscoe Clark Company, Ltd. for construction of wastewater infrastructure to serve the Bridges Subdivision. DISCUSSION: The Bridges Subdivision contains approximately 198 acres of land located in the City's ETJ just west of the City of Crowley. Briscoe Clark Company, Ltd. plans to develop the site into approximately 600 residential lots. This development is adjacent to that portion of the Bridges Subdivision located within the Crowley city limits. The agreements under consideration will only apply to that portion of the Bridges Subdivision located in Fort Worth's ETJ. Johnson County SUD is the authorized retail provider of treated water to The Bridges Subdivision pursuant to a certificate of convenience and necessity (CCN) issued by the Texas Commission on Environmental Quality. Briscoe Clark Company, Ltd. initially approached the Fort Worth Water Department (FWWD) seeking only wastewater service to the Bridges Subdivision. The FWWD felt it would be in the City's best interest to provide both water and wastewater service to the development. Johnson County SUD and the Briscoe Clark Company, Ltd. agreed. Four separate agreements were developed to implement the water and wastewater service plan for the development. The Agreement for the Sale of Treated Water provides for the sale of treated water to the Johnson County SUD at the rates charged to the City's municipal wholesale customers. Johnson County SUD will collect impact fees on behalf of the City and remit to the City on a quarterly basis. It provides for infrastructure to be designed and constructed to Fort Worth standards, installation of an 8" water meter with telemetry, limits use of the water to inside of the Bridges Subdivision and terminates if the City elects to purchase the water system, but no later than July 11, 2022. Johnson County SUD also agrees not to oppose Fort Worth's application to acquire the CCN after Fort Worth's purchase of the system, so that Fort Worth can become the retail water provider to the development. The Sewer Service Billing Agreement provides for the Johnson County SUD to serve as agent for Fort Worth for the billing and collection of sewer service fees. Bridges customers will pay outside City rates that will include a cap and a minimum fee but no winter quarter average. Johnson County SUD will be allowed http://www.cfwnet.org/council_packet/Reports/mc_print.asp 11/8/2006 Page 2 of 2 to ret#n 10% of the sewer service fee for billing service compensation. They will also collect sewer impact and tap fees and rebate them to Fort Worth on a quarterly basis. The Buy-Out Option Contract provides for a buy-out option period for Fort Worth to purchase the water system from Johnson County SUD between July 11, 2015 and Julyl1, 2021. The purchase price for the water system is set at the total amount of all impact fees collected and rebated to the City of Fort Worth plus interest accrued. The Community Facilities Agreement will be a standard community facilities agreement with the City of Fort Worth for the installation of the wastewater system. Briscoe Clark Company, Ltd. will pay for all onsite improvements and the installation of a customer meter station. Fort Worth will pay for over sizing associated with the installation of an 18" sewer outfall main. The staff feels that the negotiated agreements are a good deal for the City of Fort Worth. They provide for the orderly growth and development for the Bridges Subdivision and future developments in the area within the City's ETJ. Water and sewer facilities will be built to City standards. The extension of the sewer outfall main from Crowley through the subdivision will open up areas to the west within Fort Worth's ETJ for development. They also provide for the future transfer of water facilities and the CCN to the City at the City's option. FISCAL INFORMATION/CERTIFICATION: The Finance Director certifies that the Water Department and the Finance Department will be responsible for the collection, deposit and recording of revenues under this Agreement. TO Fund/Account/Centers FROM Fund/Account/Centers PE45 493042 0601000 $0.00 PE45 493022 0701000 $0.00 Submitted for City Manager's Office b Marc Ott (6122) Originating Department Head: S. Frank Crumb (8207) Additional Information Contact: S. Frank Crumb (8207) http://www.cfwnet.org/council_packet/Reports/mc_print.asp 11/8/2006