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HomeMy WebLinkAboutContract 42120 CITY SECRETARY CONTRACT NG. BROOKFIELD WATER AND WASTEWATER UTILITY SERVICE AGREEMENT This Brookfield Water and Wastewater Utility Service Agreement ("Agreement") is entered into by and between the City of Fort Worth, Texas (the "City"), a home-rule municipal corporation situated in Tarrant, Denton, and Wise Counties, Texas, acting by and through its duly authorized Assistant City Manager; Brookfield Acquisitions, L.P., a Texas limited partnership ("Owner"); Aqua Utilities, Inc., a Texas corporation doing business as Aqua Texas, Inc. ("Aqua Texas"); and South Denton County Water Control and Improvement District No. 1 (the "District"). ARTICLE I RECITALS A. Owner intends to develop a mixed-use, master-planned community to be known as "Brookfield" situated on approximately 231.579 acres in Denton County, Texas, as shown on Exhibit A and more particularly described in Exhibit B attached to this Agreement (the "Development"), which Development lies entirely within the City's extraterritorial jurisdiction ("ETJ"). B. Aqua Texas, the City, Owner, and the District wish to cooperate in obtaining and providing safe, adequate and reliable water and wastewater service to the Development in compliance with applicable rules and requirements of the Texas Commission on Environmental Quality("TCEQ"), the City's Infrastructure and Utility Standards, and the rules of the District. C. Aqua Texas currently holds Certificate of Convenience and Necessity ("CCN") No. 11157 authorizing the CCN-holder to provide retail water service in various areas within Denton and Wise Counties, including the land within the Development, and amended CCN No. 20453 authorizing Aqua Texas to provide retail wastewater service to land within the Development. D. The City has reached certain agreements with the District and Aqua Texas regarding the provision of wholesale water and wastewater service to the Development, and the City has a continuing interest in (i) the regulation of development for the health and safety of residents in its ETJ, and (ii) integrating the Brookfield water and wastewater systems into the City's water and wastewater system. E. On 2011, the City Council of the City approved that certain Agreement Concerning Operation of South Denton County Water Control and Improvement District No. 1 (City Secretary Contract No. , M&C- ) between the City and the District (the "Consent Agreement") containing, among other provisions, consent to conversion of the District to a freshwater supply district operating under Chapter 53, Texas Water Code, as amended, and to issuance of bonds by the District for road projects. NOW THEREFORE, for and in consideration of the mutual agreements, covenants, and conditions hereinafter set forth, the Parties contract and agree as follows: OFFICIAL PECORD Brookfield Water and Wastewater CITY SlwvRETARY Utility Service Agreement FT: WORTH, TX(age 1 1109039-I 03_1 '7-1 1 P,�1�� �� 1 N ARTICLE II DEFINITIONS "Buy-Out Contract" means the "Buy-Out Option Contract," the form of which is attached to this Agreement as Exhibit C. "CFA Policy" means the "Policy for the Installation of Community Facilities" as amended in March 2001 (M&C G-13181) in effect on the Effective Date, including any amendments thereto that are in effect on the Filing Date. "City Utility Standards" means (i) all City fire protection requirements for water line sizing, number of connections, minimum water pressure and number of fire hydrants that are in effect on the Filing Date, including any amendments thereto in effect on the Filing Date; and (ii) all City standards for design, location, construction, operation and maintenance of water and wastewater utility Infrastructure that are in effect on the Filing Date, and including all amendments to the foregoing regulations that are adopted after the Filing Date, except for any exemptions pursuant to Chapter 245 of the Local Government Code, 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. "City Review Fees" means 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. "Contractor" means a person or entity that constructs, alters or repairs Infrastructure required to serve the Development, whether located within or outside the Development. "Development" means the mixed-use, master-planned community known as "Brookfield" situated on approximately 231.579 acres in Denton County, Texas, as shown on Exhibit A and more particularly described in Exhibit B attached to this Agreement. "Development Agreement" means the Development Agreement Between the City of Fort Worth, Texas and Brookfield Acquisitions, L.P. for the Brookfield Development (City Secretary Contract No. , M & C ). "Director" means the City Water Department Director or designee. "Effective Date"means January 25, 2011. "Filing Date" means July 23, 2007, the date on which the application for approval of preliminary plat PP-07-024 for the Property (which was approved by the City's Plan Commission on September 26. 2007) was submitted to the City. If PP-07-024 expires. "Filing Date" shall be Brookticld Water and Wastewater Utility Service Agreement Page1109039-1 'deemed to be the Effective Date. For purposes of this section, "Project" means the development of the Property in accordance with this Agreement. If Owner fails to make progress (as defined in Section 245.005(c) of the Local Government Code) toward completion of the Project by January 25, 2016, the "Filing Date" shall be deemed to be the date the first permit application relating to the Project is filed with the City after January 25, 2016. "Impact Fees" means City water and wastewater impact fees for new or enlarged connections adopted by one or more City ordinances in Chapter 35, Division 2, of the Fort Worth City Code in accordance with Chapter 395, Texas Local Government Code, as such may be amended from time to time. "Infrastructure" means all water and wastewater (unless expressly identified as only water or only wastewater) facilities, equipment or related improvements necessary to serve the Development, whether located within or outside the Development, excluding the Initial Wastewater Infrastructure and the Initial Water Infrastructure. "Infrastructure Inspection Fees" means the fees applicable to the inspection and testing of Infrastructure according to the fee schedule adopted by the City Council and in effect on the date of the inspection. "Infrastructure Standards" means the standards for construction, operation and maintenance of Infrastructure constructed within the City as more specifically set forth in Article V. "Initial Wastewater Infrastructure" means wastewater facilities, equipment or related improvements necessary to serve the first 190 lots in the Development utilizing wholesale service provided by Aqua Texas or other provider, but excluding the City. "Initial Water Infrastructure" means water facilities, equipment or related improvements necessary to serve the first 190 lots in the Development utilizing wholesale service provided by Aqua Texas or other provider, but excluding the City. "Party" means, individually, the City, the Owner, the District or Aqua Texas, and any successors and assigns, as permitted by this Agreement. "Subdivision Regulations"means the City's Subdivision Ordinance No. 17154-09-2006 and Plan Commission Rules and Regulations. "TRA Contract" means the agreement between the City and the Trinity River Authority ("TRA") entitled "Trinity River Authority of Texas — Denton Creek Regional Wastewater Treatment System Contract"dated October 28, 1987 (City Secretary Contract No. 16054), as amended from time to time. "Wholesale Treated Water Service Agreement" means the "Wholesale Treated Water Service Agreement" between the City and Aqua Texas, the form of which is attached to this Agreement as Exhibit D. The Parties acknowledge that the form of the agreement set forth in Exhibit D may be modified to conform to any new wholesale water agreement used by the City for its other wholesale water customers in accordance with the terms of such agreement. Brookfield Water and Wastewater Utility Service Agreement Page 3 1109039-1 "Wholesale Wastewater Service Agreement" means the "Wholesale Wastewater Service Agreement" between the City and Aqua Texas, the form of which is attached to this Agreement as Exhibit E. The Parties acknowledge that the form of the agreement set forth in Exhibit E may be modified to conform to any new wholesale wastewater agreement used by the City for its other wholesale wastewater customers in accordance with the terms of such agreement. ARTICLE III WHOLESALE WATER AND WASTEWATER SERVICE 3.01 Wholesale Water Service. The first 190 retail water connections in the Development may be served by Aqua Texas utilizing the Initial Water Infrastructure and water obtained from groundwater wells or any other available wholesale water supply source. Within ninety (90) days of execution of this Agreement, the District shall submit a Wholesale Water Service Plan for the Development to the City for review and approval. The Wholesale Water Service Plan shall describe all water Infrastructure proposed by the District to serve the Development at full build-out. The Wholesale Water Service Plan shall identify at a minimum: (i) the location of the wholesale water delivery point for the Development; (ii) the location of the wholesale master meter connection to the City's water system; (iii) the location and sizing of water mains and other lines to be used in obtaining wholesale water service from the City; (iv) the location of the water pumping and storage facilities to be used in obtaining wholesale water service from the City (such water pumping and storage facilities to be constructed prior to connection of the wholesale master meter to the City's water system) subject to the District's right to make minor adjustments to such locations upon final design. The Parties acknowledge that the Brookfield Offsite Utility Exhibit attached hereto as Exhibit F may be submitted as part of the Wholesale Water Service Plan and that the water Infrastructure depicted thereon accurately reflects the infrastructure proposed for the Development. Upon completion of construction of all water Infrastructure required by the City to provide wholesale water service to the Development, the first 190 connections and any additional connections in the Development shall be served by Aqua Texas utilizing water obtained from the City under the Wholesale Treated Water Service Agreement, the form of which is attached as Exhibit D. Any wholesale treated water service agreement to be entered into by the City shall not contain terms and conditions more favorable than as set forth in the City's wholesale water service contracts with its existing wholesale customers. 3.02 Wholesale Wastewater Service. The first 190 retail wastewater connections in the Development may be served by Aqua Texas utilizing the Initial Wastewater Infrastructure and the existing Shale Creek wastewater treatment plant authorized under TCEQ Permit No. WQ14186-001, the Elizabeth Creek wastewater treatment plant authorized under TCEQ Permit No. WQ14186-001, or any other available wholesale wastewater service provider. Within ninety (90) days of execution of this Agreement, the District shall submit a Wholesale Wastewater Service Plan for the Development to the City for review and approval. The Wholesale Wastewater Service Plan shall describe all wastewater Infrastructure proposed by the District to serve the Development at full build-out. The Wholesale Wastewater Service Plan shall identify at a minimum: (i) the location of the wholesale master meter connection to the City's wastewater system: (ii) the location and sizing of wastewater mains and other lines to be used in obtaining wholesale wastewater service from the City: and (iii) the location of any wastewater lift station. Brookfield Watcr and Wastcwatcr Utility Service Agreement Page 4 1109039-I pumping and detention facilities to be used in obtaining wholesale wastewater service from the City, subject to the District's right to make minor adjustments to such location upon final design. The Parties acknowledge that the Brookfield Offsite Utility Exhibit attached hereto as Exhibit F may be submitted as part of the Wholesale Wastewater Service Plan and that the wastewater Infrastructure depicted thereon accurately reflects the infrastructure proposed for the Development. Upon completion of construction of all wastewater Infrastructure required by the City to provide wholesale wastewater service to the Development, the first 190 connections and any additional connections in the Development shall be served by Aqua Texas utilizing wastewater service from the City under the Wholesale Wastewater Service Agreement, the form of which is attached as Exhibit E. Any wholesale wastewater service contracts to be entered into by the City shall not contain terms and conditions more favorable than as set forth in the City's wholesale wastewater service contracts with its existing wholesale customers. 3.03 Construction Ownershipand nd Operation of Approach Water Main. The approach water main depicted on Exhibit F (the "Approach Water Main") shall be paid for and constructed by Owner on behalf of the District. Within sixty (60) days after inspection and acceptance by the City, the Approach Water Main on the City's side of the wholesale master meter connection to the City's water system shown on Exhibit F shall be contributed to the City by the District along with all appurtenant easements and rights-of-way. The City agrees to reserve capacity in its water system to meet the minimum required capacity requirements of the Development. Following the contribution of the Approach Water Main to the City, the City shall have full ownership and operational control of the Approach Water Main, provided the City reserves capacity in its water system to meet the minimum required capacity requirements of the Development. Aqua Texas shall provide a master meter connection from the City's water system to the Development as provided for in the Wholesale Treated Water Service Agreement. The cost of replacing the originally installed meter with a larger size meter in order to meet City Utility Standards shall be the responsibility of Aqua Texas and/or the District. Any additional master meter connections to the Approach Water Main for other subdivisions or developments shall be the subject of a separate utility service agreement; provided, however, the District or Owner shall be entitled to water main capacity per acre charges collected by the City from other developments served off of 18,070 linear feet of 30-inch water main (the "30-Inch Main") and 4,500 linear feet of 24-inch water main (the "24-Inch Main") shown on Exhibit F, which may include without limitation the Alpha Ranch, Elizabeth Creek and Shale Creek developments, to the extent authorized under Sections 35-87 through 35-93 of the City's Code of Ordinances, and/or other right of reimbursement under City regulations for oversizing of the 30-Inch Main from 24 inches needed to serve the development to 30 inches, and oversizing of the 24-Inch main from 16 inches needed to serve the Development to 24 inches. 3.04 Construction Ownership and Operation of Sewer Mains. The approach sewer mains depicted on Exhibit F (the "Approach Sewer Mains") shall be paid for and constructed by Owner on behalf of the District. Within sixty (60) days after inspection and acceptance by the City, the Approach Sewer Mains on the City's side of the wholesale master meter connection to the City's wastewater system shall be contributed to the City by the District along with all appurtenant easements and rights-of-way. The City agrees to reserve capacity in its wastewater system to meet the minimum required capacity requirements of the Development. Following the contribution of the Approach Sewer Mains to the City. the City shall have full ownership and operational control of the Approach Sewer Mains. provided the City reserves capacity in its Brookfield Water and Wastewater Utility Service/Agreement Page 5 1109039-1 wastewater system to meet the minimum required capacity requirements for the Development. Aqua Texas shall provide a master meter connection from the City's sewer system to the Development as provided for in the Wholesale Wastewater Service Agreement. Any additional master meter connections to the Approach Sewer Mains for other subdivisions or developments shall be the subject of a separate utility agreement; provided, however, the District or Owner shall be entitled to sewer per acre charges collected by the City from other developments served off of 24,800 linear feet of 24-inch sewer main (the "24-Inch Main") shown on Exhibit F, which may include without limitation the Alpha Ranch, Elizabeth Creek and Shale Creek developments, to the extent authorized under Sections 35-81 through 35-86 of the City's Code of ordinances, and/or other right of reimbursement under City regulations for oversizing of the 24- Inch Main from 18 inches needed to serve the Development to 24 inches. 3.05 Construction and Ownership of Other Infrastructure. Under any CFA, Owner and/or the District shall bear the full costs of construction of all water and wastewater Infrastructure. All water and wastewater Infrastructure located on the Development's side of the master water and wastewater meter connections to the Development will be owned by the District and leased to Aqua Texas unless and until such Infrastructure is acquired by the City pursuant to Section 7.01. All water and wastewater Infrastructure located on the City's side of the master water and wastewater meter connections to the Development will be owned and operated by the City. 3.06 Use of Wastewater Capacity Allocated to City y Trinity River Authority. The City will allocate to the Development a portion of its available TRA Contract treatment capacity sufficient to accept the wastewater from the Development pursuant to the Wholesale Wastewater Service Agreement. As provided for in the Wholesale Wastewater Service Agreement, the right of the City to provide wastewater service to the Development through the TRA Contract is subject to the approval of both the TRA and a majority vote of the TRA Advisory Committee. 3.07 Easements and Rights-of-Way. All easements or rights-of-way required for the installation of water and wastewater Infrastructure required to deliver wholesale water and wastewater service to the Development by the City, and for the continuous operation and maintenance of all associated metering and sampling facilities, will be acquired by the District, Owner or Aqua Texas and granted to the City at no cost to the City. To facilitate the City's wholesale water and wastewater service to the Development, the District, Owner and Aqua Texas will grant to the City such easements and rights-of-way as are necessary to connect the City's water and wastewater systems (or the Trinity River Authority's wastewater system), to the Development at no cost to the City. Aqua Texas shall not be required to purchase any additional easements or right of way in connection with its obligations hereunder. 3.08 Access, Ingress and Egress. Upon prior Notice by the City, any duly authorized employee of the City bearing proper credentials and identification shall be granted access to any area or location within the Development as the City may determine is necessary for the purpose of inspecting, observing, measuring, sampling, testing or auditing the City's wholesale water and wastewater Infrastructure and service to the Development. In addition, the City will be given continuous rights of ingress and egress to all metering and sampling facilities. Brookfield Water and Wastckkatcr I Itilit\ Service Agreement Page b 1109039-1 3.09 Oversizing of Infrastructure. The City shall not require Owner or the District to design or construct (or pay for designing or constructing) Infrastructure that exceeds the capacity needed to serve the Development except as shown on Exhibit F. ARTICLE IV RETAIL WATER AND WASTEWATER UTILITY SERVICE 4.01 Service Plans to be Submitted. The District will submit retail water and wastewater utility service plans for the Development to the City for review and approval, which approval shall not be unreasonably withheld. The City will make reasonable efforts to complete its review within 120 days of receipt of each plan. Approval of both a retail water utility service plan and a retail wastewater utility service plan by the City shall be a condition of the City's approval of a final plat for the Development. If Owner creates any additional conservation and reclamation districts over the area covered by the Development, Owner shall submit a single retail water utility service plan and a single retail wastewater service utility service plan covering each district. 4.02 Retail Water Service Plans. To obtain City approval, the retail water utility service plan must meet the following requirements: (a) All meters, water metering stations, valves, meter boxes, water distribution lines and other water Infrastructure to serve the Development ("Retail Water Infrastructure") shall meet all City Utility Standards, all Infrastructure Standards, and all other standards and requirements as set out or referenced in Article V; provided, however, the first 190 residential units are not required to meet City fire flow standards for water service prior to the time the first 190 residential units obtain access to the City's wholesale water system. Following construction of the first 190 residential units, the City will not issue a building permit for any additional residential unit or nonresidential structure in the Development unless and until the first 190 units obtain service from the City under the Wholesale Treated Water Service Agreement with the City and meet all applicable City Utility Standards. (b) The plan must demonstrate that an adequate supply of potable water meeting the more stringent of the capacity, volume and pressure requirements of(i) the City Utility Standards, or (ii) TCEQ public water system rules, will be provided. Such demonstration shall be made prior to the City's approval of a preliminary plat for the Development; provided, however, City fire flow standards shall not apply to the first 190 residential units prior to the time such residential units obtain access to the City wholesale water system. (c) All plans and specifications for Retail Water Infrastructure shall be submitted to the City as part of the retail water utility service plan. (d) Upon City approval of the retail water utility service plan submitted pursuant to this Agreement, the City will not seek to challenge the service area for CCN No. 1 1 157 to serve the Development. Brookfield Watcrand Wastewater Utility Scrvicc ngrccment Pagc 7 1109639-1 4.03 Retail Wastewater Service Plans. To obtain City approval, the wastewater utility service plan must meet the following minimum requirements: (a) All meters, wastewater metering stations, sewer service lines, manholes and other wastewater Infrastructure to serve the Development ("Retail Wastewater Infrastructure") shall meet all City Utility Standards, all Infrastructure Standards, and all other standards and requirements as set out or referenced in Article V. (b) The plan must demonstrate that an adequate means of providing wastewater treatment and disposal meeting all TCEQ wastewater treatment and disposal requirements will be provided. Such demonstration shall be made prior to the City's approval of a preliminary plat for the Development. (c) All plans and specifications proposed for Retail Wastewater Infrastructure shall be submitted to the City as part of the retail wastewater utility service plan. (d) Where the District, Owner or Aqua Texas will provide wastewater treatment service through a wastewater treatment and disposal facility other than the Shale Creek wastewater plant and/or the Elizabeth Creek wastewater plant, such wastewater treatment plant shall be permitted, constructed, operated and maintained in accordance with all applicable TCEQ requirements, and in addition shall be permitted to meet effluent limitations no less stringent than 5-5-2-1 (5 parts per million ["ppm"] biochemical oxygen demand; 5 ppm total suspended solids; 2 ppm nitrogen; and 1 ppm phosphorous). The City will not contest any TCEQ or other regulatory approvals sought by Aqua Texas, the District or Owner for such wastewater treatment plant so long as the plant remains in compliance with applicable TCEQ requirements and the foregoing effluent limitations. (e) Upon City approval of the retail wastewater utility service plan submitted pursuant to this Agreement, the City will not seek to challenge the service area for CCN No. 20453 to serve the Development. 4.04 Participation Fees. Prior to the City's delivery of treated water under the Wholesale Treated Water Service Agreement, the Owner shall pay to the City the "Cost of New or Additional Connections" as required by Section 3.3 of the Wholesale Treated Water Service Agreement based on the number of lots in the Development at full build-out as shown in the preliminary plat approved by the City. The Parties agree and acknowledge that the total of such costs is $353,970 which is reasonably determined under the projection of full build-out of the Development of 892 lots with a maximum daily demand of 1.51 MGD and a cost of$234, 417 per MGD (i.e., 1.51 MGD x $234,417 = $353,970). Such cost shall not be a System Cost. The Owner will pay the amount of$353,970 to the City in a single lump sum payment at the time of the initial connection of the Fort Worth System to the Customer System to serve the Development. 4.05 Notices to Retail Customers. At least once annually. water and wastewater bills sent to all retail customers within the District will contain the t`611owing statement: "This .serilce IIrooklicld water and \astcv�ater t�tilith 5cry-icc ngrccmcnt Pagc 8 1109039-1 address is inside the boundaries of a water district that may be annexed in the future by the City of Fort Worth. " 4.06 Service by Another Entity. If the District or Owner engages or allows any entity other than Aqua Texas to provide retail water or wastewater operations and maintenance or management services to land within the Development, then the District or Owner will first contractually obligate such entity to the terms and conditions of this Agreement to the same extent that Aqua Texas is obligated. ARTICLE V CONSTRUCTION, OPERATION AND MAINTENANCE OFINFRASTRUCTURE 5.01 Infrastructure Standards. All wholesale and retail water and wastewater Infrastructure shall be designed and constructed in compliance with this Article V and: (a) the City Utility Standards; (b)rules and regulations of the TCEQ; and (c) the rules and regulations, if any, of the District ("Infrastructure Standards"), with the exception of the pump station shown on Exhibit F consisting of ground storage tanks, pumps, pressure tanks and related appurtenances which shall be built to TCEQ standards. 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. 5.02 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. 5.03 Plan Review; Payment of Fees; and Pre-Construction Conference. Construction of Infrastructure shall not commence until (i) final construction plans and specifications have been reviewed and accepted by the City for compliance with the City's Utility Standards; (ii) a pre-construction conference has been held by the Contractor, the District's engineer and designated representatives of the City; and (iii) the applicable City Review Fees have been paid. At such pre-construction conference, the City shall designate City employees to serve as the project manager and the project inspector (the "City Inspector"). The City's review of construction plans and specifications for compliance with the City's Utility Standards and notification of the District of any deficiencies in such construction plans and specifications shall not be unreasonably delayed. 5.04 Community Facilities Agreements. Construction of Infrastructure shall not commence until a Community Facilities Agreement ("CFA") has been executed in accordance with the City's CFA Policy and which is consistent with the terms and conditions of this Utility Service Agreement. 5.05 Inspections by Third Party Inspectors. Except as otherwise provided in this Article V, inspectors retained and paid for by the District (or by Owner on behalf of the District) and approved by the City shall perform all inspections and testing of the construction of Brooklield Water and Wastewater lltilitN Service Agreement Page 9 1 10903 9-1 'Infrastructure for compliance with this Article V. The District or Owner, as applicable, shall submit the names, addresses and phone numbers of such inspectors as part of the submittal of the retail water and wastewater service plans in accordance with Articles III and IV. Construction of Infrastructure shall not commence until such inspectors have been approved by the City which approval shall not be unreasonably withheld or delayed. The District shall require all inspectors it retains to provide copies of all inspection and testing reports to the City Inspector within five (5) business days of the date of the inspection. 5.06 Termination of Third Party Inspectors. The City has the right to terminate any third party inspector retained by the District or Owner pursuant to Section 5.05 if the inspector: (i) fails to properly perform inspections and testing to ensure construction in compliance with this Article V; or (ii) fails to timely provide copies of inspection and testing reports to the City's Inspector. Upon termination of any third party inspector, the City, at its option, may: (i) allow the use of another approved third party inspector, or (ii) perform all necessary inspections and testing. Should the City elect to perform inspections and testing pursuant to this Section 5.06, the City shall perform such inspections and testing for compliance with this Article V in a timely manner and the District shall pay the City an inspection fee to reimburse the City for its reasonable and necessary costs of performing the Infrastructure inspection. 5.07 Inspection by City. The City shall have the right to charge an Infrastructure inspection fee for City-conducted inspections and testing only for inspections and testing performed by the City pursuant to Section 5.06. In such case, the City may charge the City's prevailing Infrastructure inspection fee applicable to inspections outside the City's corporate limits. Notwithstanding the foregoing limitation on the City's right to charge an Infrastructure inspection fee, the City has the right, but not the obligation, to inspect and test the Infrastructure at any time and to participate in a final inspection of all Infrastructure. The Contractor shall notify the City Inspector when Infrastructure is ready for final inspection. If the City Inspector concurs that construction of the Infrastructure is substantially complete, the City Inspector will schedule a final inspection by the City within 30 days. Upon such final inspection and correction of any punch list items, written certification by the City Inspector that Infrastructure has been constructed in compliance with City Utility Standards shall constitute compliance with the inspection requirements of this Article V. 5.08 Access by City Employees. Upon prior Notice by the City, any duly authorized employee of the City bearing proper credentials and identification shall be granted access to any property of the District within the Development as the City may determine necessary for the purpose of inspection and testing of Infrastructure. 5.09 Contractors. If any Party engages a Contractor to construct Infrastructure, such Party shall incorporate the requirements of this Article V into a written construction contract with the Contractor. All such contracts shall provide that the City is a third-party beneficiary of and may enforce such contracts against the Contractor. 5.10 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. Brookfield Walcr and Waslewatcr I Itility Scrvicc Agreement Page 10 1109039-1 5.11 As-Built Drawings. The District and the Owner shall be jointly responsible for the delivery of mylar as-built drawings for all Infrastructure to the City Inspector within 30 days after final inspection. ARTICLE VI IMPACT FEES 6.01 Collection of Impact Fees. The City will assess and collect Impact Fees within the Development at 100% of the total maximum assessable amount as adopted by the City Council. The City shall not commence providing wholesale water or wastewater service within the Development until the District pays to the City Impact Fees for each existing retail water and wastewater connection within the Development, based upon the size of the retail water meter, including the first 190 residential structures. Commencing with the 191" residential structure, the City may refuse to issue a building permit for construction of any structure in the Development, as required by the Development Agreement, until the Impact Fees for such structure are paid to the City, based on the size of the retail water meter. Commencing with the 191St residential structure within the Development, neither Aqua Texas nor the District will set a retail meter for water or wastewater service for any structure until Impact Fees for such structure have been paid to the City. The District or Owner shall be responsible for the payment of all Impact Fees. Payment of such fees shall not be a set off or reduction against any fees District or Owner is obligated to pay Aqua Texas under other agreements. 6.02 Reporting Requirements. The District, Owner, and Aqua Texas shall provide to the City such information as may be requested by the Director relating to the making of new or enlarged retail connections within the Development, including information required to be provided by the Wholesale Treated Water Service Agreement and the Wholesale Wastewater Service Agreement. ARTICLE VII CITY ACQUISITION OF RETAIL FACILITIES 7.01 Transfer of Retail Water or Wastewater Services. Pursuant to CCN No. 11157 and CCN No. 20453, Aqua Texas shall have the right and obligation to provide retail water and wastewater service to the Development; provided however, the City may in its sole discretion seek to become the sole certificated retail provider of water service to the Development and the sole retail provider of wastewater service to the Development (with or without a wastewater CCN, in the City's discretion) (a) at any time after seventeen (17) years from the date of the first connection within the Development to the City's water system, or (b) at an earlier date if agreed by the District and Aqua Texas. To effectuate the transfer of retail water and wastewater service from the District to the City, the Parties have entered into a Buy-Out Option Contract (the "Buy- Out Contract") a copy of which is attached as Exhibit C. The District, Aqua Texas and Owner agree not to contest any applications filed by the City at the TCEQ for a new or amended water and/or wastewater CCN to effectuate the future transfer of retail water and/or wastewater service rights for the Development to the City pursuant to the provisions of this Section 7.01, and further agree that they shall cooperate and assist the City to the extent reasonably necessary in obtaining any regulatory approvals required to effectuate such transfer of water or wastewater utility service rights and obligations to the City. Brookfield Water and Wastewater Utility Service Agreement Page 11 1109039-1 7.02 Lease Termination. Any District lease covering all or any part of the Infrastructure shall terminate upon transfer of any Infrastructure covered by such lease to the City pursuant to the Buy-Out Contract, and each such lease shall contain a provision expressly providing for such termination. Likewise, upon transfer of any Infrastructure pursuant to the Buy-Out Contract, Aqua Texas shall not have any obligation of any kind whatsoever to provide water or wastewater service to the Development and the Agreement for Sale of Treated Water by and between the City and Aqua Texas pursuant to Section 3.01 and the Agreement for Wastewater Service by and between the City and Aqua Texas pursuant to Section 3.02 shall terminate in accordance with their terms. 7.03 Effect of Transfer. Once the City becomes the certificated retail provider of water and the sole retail provider of wastewater service to the Development (with or without a wastewater CCN, in the City's discretion), Aqua Texas will cease providing water and wastewater utility service to that area, and the City shall have no further obligations to the District, Owner or Aqua Texas with regard to the costs, operation, equipment removal or site restoration of the water and wastewater system operations at the Development, or any portion of the Development that may have been served by such facilities. All costs of dismantling, decommissioning and removal of the then-existing water and wastewater system facilities not utilized by the City shall be borne by the District. ARTICLE VIII INDEMNIFICATION 8.01 Indemnity. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DISTRICT, OWNER AND AQUA TEXAS AGREE 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 OR INDIRECTLY ARISING OUT OF,CAUSED BY OR RESULTING FROM (IN WHOLE OR IN PART) ANY BREACH OF THIS AGREEMENT OR ANY CONSTRUCTION, OPERATION, OR MAINTENANCE OF THE INFRASTRUCTURE, (COLLECTIVELY, "LIABILITIES"), EVEN IF SUCH LIABILITIES ARISE FROM OR ARE ATTRIBUTED TO STRICT LIABILITY OR THE CONCURRENT NEGLIGENCE OF ANY INDEMNITEE. NOTWITHSTANDING THE FOREGOING, IF THE DISTRICT, OWNER,AND/OR AQUA TEXAS ARE DETERMINED TO BE JOINTLY LIABLE TO ANY THIRD PARTY, THE PARTIES SHALL SHARE IN SUCH LIABILITY TO THE EXTENT OF THEIR FAULT. 8.02 Insurance and Indemnity by Contractors. If any Party engages a Contractor to construct, reconstruct, repair or maintain Infrastructure, such Party shall include in the contract requirements that the Contractor must provide adequate insurance covering the City as an additional insured. Such contract must also require that the Contractor covenant to indemnify, hold harmless and defend the City against any and all suits or claims for damages of any nature arising out of the 13rookiicid Watcr and Wastcwatcr Utilih,Scrvicc ngrccntcnt Nagc 12 1109039-1 performance of such contract, even if such Liabilities arise from or are attributed to strict liability or to the sole or concurrent negligence of any Indemnitee. ARTICLE IX MISCELLANEOUS 9.01 Governing Law; Jurisdiction and Venue. THIS AGREEMENT SHALL 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 AGREE THAT ANY SUCH COURT SHALL BE A PROPER FORUM FOR THE DETERMINATION OF ANY DISPUTE ARISING HEREUNDER. 9.02 Conspicuous Provisions. The City, the District, Owner and Aqua Texas acknowledge that the provisions of this Agreement set out in bold, CAPITALS (or any combination thereof) satisfy the requirements for the express negligence rule and/or are conspicuous. 9.03 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 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 Brookfield Water and Wastewater utility Service Agreement Page 13 1109039-I 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 Aqua Texas: Aqua Utilities, Inc. dba Aqua Texas, Inc. Attn: Vice-President 1106 Clayton Lane, Ste. 40OW Austin, Texas 78723 FAX: (512) 263-5624 Aqua Utilities, Inc. dba Aqua Texas, Inc. Attn: Chief Legal Officer 762 West Lancaster Ave. Bryn Mawr, Pennsylvania 19010 FAX: (610) 520-9127 To the District: South Denton County WCID No. 1 c/o: Crawford& Jordan, LLP Attn: Christopher Jordan 19 Briar Hollow Lane, Suite 245 Houston, Texas 77027 FAX: (713) 621-3909 To Owner: Brookfield Acquisitions, L.P. Attn: Ross Calhoun 1221 I.H. 35E, Suite 200 Carrollton, Texas 75006 FAX: (469) 892-7202 9.04 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 discretion, provided that such action is not arbitrary or unreasonable. 9.05 Assignment. 13rookheld Water and Wastewater lJtility Service Agreement Nage 14 1109039-1 (a) Neither the District nor the City may assign this Agreement without the written consent of the other Parties. (b) Aqua Texas may not assign this Agreement without the prior written consent of the City; provided, however, that Aqua Texas' rights hereunder may be assigned or transferred upon Notice, but without the City's consent to (i) any subsidiary or affiliate of Aqua Texas (i.e., any entity with respect to which 50% or more of the voting and economic interests are owned by Aqua Texas or its parent) so long as Aqua Texas shall remain liable to the City for any and all liabilities or obligations arising out of this Agreement, or(ii) to any entity acquiring all or substantially all of the assets or common stock of Aqua Texas or its successor. Any assignee must assume all obligations of Aqua Texas and any liability that may result from acts or omissions by Aqua Texas or the assignee under this Agreement that may arise or accrue from and after the effective date of the assignment. If this Agreement is assigned to any entity by Aqua Texas, then the Buy-Out Contract must be assigned at the same time and to the same extent as this Agreement. (c) Owner has the right, from time to time, to assign this Agreement, in whole or in part, and including any obligation, right, title, or interest of Owner under this Agreement, to the District and to any person or entity (an "Assignee") without the consent of the City, provided that the following conditions are satisfied: (i) if not the District, Assignee is a successor owner of all or any part of the Development or is a lender to a successor owner of all or any part of the Development; (ii) if not the District, Assignee has a contractual right to be reimbursed for water, sewer, or drainage improvements and/or the Road Project from District Bonds (or has a lien or other security interest in such reimbursements); (iii) the assignment is in writing executed by Owner and Assignee in the form of assignment attached as Exhibit G; (iv) Assignee expressly assumes in the assignment any assigned obligations and expressly agrees in the assignment to observe, perform, and be bound by this Agreement to the extent this Agreement relates to the obligations, rights, titles, or interests assigned; and (v) a copy of the executed assignment is provided to all Parties within 15 days after execution. Provided the foregoing conditions are satisfied, from and after the date the assignment is executed by Owner and Assignee, the City agrees to look solely to Assignee for the performance of all obligations assigned to Assignee and agrees that Owner shall be released from performing the assigned obligations and from any liability that results from the Assignee's failure to perform the assigned obligations. No assignment by Owner shall release Owner from any liability that resulted from an act or omission by Owner that occurred prior to the effective date of the assignment. Owner shall maintain written records of all assignments made by Owner (including, for each Assignee, the Notice information required by this Agreement, and including a copy of each executed assignment) and, upon written request from any Party or Assignee, shall provide a copy of such records to the requesting person or entity. 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, whether judicial or Brookfield Water and Wastcwatcr Utility Service Agrccmcnt Page 15 1109039-1 non judicial. This Agreement shall be binding upon and insure to the benefit of the Parties and their respective successors and Assignee. 9.06 No Third Party Beneficiary. This Agreement is solely for the benefit of the Parties, and neither the City, the District, Aqua Texas nor Owner 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, the District, Aqua Texas and Owner. 9.07 Amendment. This Agreement and the agreements listed in Section 9.18 may be amended only with the written consent of all parties to such agreement and with approval of the governing bodies of the City and the District, if a party to such agreement. 9.08 No Waiver. Any failure by a Party to insist upon strict performance by the other Party of any material provision of this Agreement shall not be deemed a waiver thereof, and the Party 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. 9.09 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 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. 9.10 Captions. Captions and headings used in this Agreement are for reference purposes only and shall not be deemed a part of the Agreement. 9.11 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. Any 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. Brookfield Water and Wastewater tItiliv, Service Agreement Page 16 1109039-1 9.12 Breach,Notice and Remedies. (a) If any Party commits a breach of this Agreement, the non-breaching Party shall give Notice to the breaching Party that describes the breach in reasonable detail. (b) The breaching Party shall commence curing such breach within fourteen (14) calendar days after the time the breaching Party receives such Notice and complete the cure within fourteen (14) calendar days from the date of commencement of the cure; however, if the breach is not reasonably susceptible to cure by the breaching Party within such 14-day period, the non-breaching Party shall not bring any action so long as the breaching Party has commenced to cure the default within such 14-day period and diligently completes the cure within a reasonable time without unreasonable cessation of the work. (c) If the breaching Party does not substantially cure such breach within the stated period of time, the non-breaching Party may, in its sole discretion, and without prejudice to any other right under this Agreement, law, or equity, seek an action under the Uniform Declaratory Judgment Act, specific performance, mandamus, injunctive relief, and other remedies described in this Agreement; provided, however, that the non-breaching Party shall not be entitled to terminate this Agreement and each Party specifically waives any right such Party has or in the future may have to terminate this Agreement. It is understood and agreed that no Party shall seek or recover actual, consequential or any other type of monetary damages or awards, including but not limited to attorney's fees, in the event that any Party brings suit under or related to this Agreement. (d) By execution of this Agreement, neither the City nor the District waives or surrenders any of its respective governmental powers, immunities or rights, except as specifically waived pursuant to this subsection. The City and the District mutually waive their governmental immunity from suit and liability only as to any action brought by a Party to pursue the remedies available under this Agreement and only to the extent necessary to pursue such remedies. Nothing in this section shall waive any claims, defenses or immunities that the City or the District has with respect to suits against the City or the District by persons or entities not a party to this Agreement. 9.13 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 unless otherwise expressly stated. 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. Brookfield Water and Wastewater Utility Service Agreement Page 17 1109039-1 9.14 Section 13.248 Agreement. The Parties agree that the designation under this Agreement of areas and customers to be served by water and wastewater utility providers is valid and enforceable and may be submitted to the TCEQ for approval at the appropriate time pursuant to Section 13.248 of the Texas Water Code regarding contracts designating areas to be served by retail public utilities. 9.15 No Joint Venture. 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. By entering into this agreement, the City has no obligation to provide water or wastewater treatment services to any area within the Development or any other area except as specifically set forth in this Agreement. 9.16 Counterpart Originals. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original. 9.17 Effect of Agreement. This Agreement supersedes any prior understandings or written or oral agreements among the Parties and their affiliates, concerning the subject matter hereof. 9.18 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 Brookfield Development Exhibit B Legal Description of the Brookfield Development Exhibit C Buy-Out Option Contract Exhibit D Wholesale Treated Water Service Agreement Exhibit E Wholesale Wastewater Service Agreement Exhibit F Brookfield Offsite Utility Exhibit Exhibit G Assignment and Assumption Agreement ATTEST: CITY OF FORT WORTH o By: Marty Hendri X- o�Ob7, ..e �City Secretary oY1 iV1 J1 G o Y d (print name) 0 v o � itle: 14- hhi ��� G�tiyp� °°000000°° 4f Date: APPROVED AS TO FO����,tea LEGALITY: c - 941 a� 'A AssistanfCityAttome contract Authorization OFFICIAL RECORD ' CITY SECRETARY Brooklicld Watcr and Wastcwatcr FT. WORTH, TX Utility Scrvicc Agrccmcnt Page 18 1109039-1 ATTEST: AQUA UTILITIES, INC. dba AQUA TEXAS, INC. B Corporate Secretary Robert L. Laughman, Presid Date: January 13, 2011 BROOKFIELD ACQUISITIONS, L.P., a Texas limited partnership By:MMM Ventures, LLC, a Texas limited liability company Its: General Partner By: 2M Ventures, LLC, a Delaware limited liability company Its: Manager / By: /C Mehrdad Moayedi Title: Governing Person Date: SOUTH DENTON COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 1 By: -- (print n me) Title: Date: OFFICIAL RECORD CITY SECRETARY FT. WORTH, TX Brookfield Water and Wastewater Utility Service Agreement Page 19 1109039-1 Exhibit A Map of Brookfield Development JI T. 'I i 17 J� Xaov it r ii Exhibit A to Brookfield Water and Wastewater Utility Service Agreement Page I Exhibit B Legal Description of Brookfield Development BEING a tract of land located in the WILLIAM C. HALLMARK SURVEY, ABSTRACT NO. 518, Denton County, Texas and being all of a tract of land described as Tract 1 and 2 in Deed to Brookfield Acquisitions, L.P., recorded in Document Number 2007-45036, Deed Records, Denton County, Texas and being more particularly described as follows: BEGINNING at a concrete monument with a 1/2 inch iron rod found in the North right-of-way line of State Highway No. 114, a 100 foot right-of-way, at the Southeast corner of said Tract 2; THENCE North 89 degrees 31 minutes 05 seconds West, along said North right-of-way line, a distance of 1,026.70 feet to a 1/2 inch iron rod with a yellow plastic cap stamped 'DAA" set at the Southeast corner of a tract of land described in Deed to Willow Bend 114, recorded in Document Number 2005-8893, Deed Records, Denton County, Texas; THENCE North 00 degrees 19 minutes 46 seconds East, a distance of 2,518.47 feet to a 1/2 inch iron rod with a yellow plastic cap stamped "5439" found at the Northeast corner of Lot 13, Block A of WILLOW SPRINGS SUBDIVISION, an Addition to Denton County, Texas according to the Plat thereof recorded in Cabinet D, Page 317, Plat Records, Denton County, Texas; THENCE South 89 degrees 59 minutes 13 seconds West, along the North line of said Lot 13, a distance of 13.26 feet to a 1 inch iron rod found at the Southeast corner of a tract of land described in Deed to Robert B. Logan, recorded in Volume 515, Page 92, Deed Records, Denton County, Texas; THENCE North 00 degrees 14 minutes 58 seconds East, a distance of 1,563.70 feet to a 3/8 inch iron rod found at the Northwest corner of said Tract 1; THENCE South 89 degrees 28 minutes 37 seconds East, a distance of 3,160.54 feet to a 1/2 inch iron rod with a yellow plastic cap stamped "EC&D" found at the Northeast corner of said Tract 1; THENCE South 00 degrees 15 minutes 25 seconds East, a distance of 2,753.84 feet to a 1/2 inch iron rod with a yellow plastic cap stamped "EC&D" found at the most Easterly Southeast corner of said Tract 1; THENCE North 89 degrees 36 minutes 34 seconds West, a distance of 2,150.81 feet to a 1/2 inch iron rod with a yellow plastic cap stamped "EC&D" found at an inner ell corner of said Tract 1; THENCE South 00 degrees 08 minutes 43 seconds West, a distance of 1,322.76 feet to the POINT OF BEGINNING and containing 231.579 acres of land, more or less. Exhibit B to Brookfield Water and Wastewater Utility Service Agreement Page I Exhibit C Buy-Out Option Contract Exhibit C to Brooklicld Watcr and Wastewater Utility Servicc Agreement Pagc I BUY-OUT OPTION CONTRACT FOR BROOKFIELD DEVELOPMENT This Buy-Out Option Contract ("Contract") is entered into by and between the City of Fort Worth, Texas (the "City"), a home-rule municipal corporation situated in Tarrant, Denton, and Wise Counties, Texas, acting by and through its duly authorized Assistant City Manager; Brookfield Acquisitions, L.P., a Texas limited partnership ("Owner"); Aqua Utilities, Inc., a Texas corporation doing business as Aqua Texas, Inc. ("Aqua Texas"); and South Denton County Water Control and Improvement District No. 1 (the "District"). RECITALS A. The Parties to this Contract will also execute that certain "Brookfield Water and Wastewater Utility Service Agreement", City Secretary Contract No. (the "Utility Agreement"). B. The Utility Agreement governs the provision of water and wastewater utility service to the mixed-use, master-planned community to be known as `Brookfield" situated on approximately 231.579 acres in Denton County, Texas, as shown on Exhibit A and more particularly described in Exhibit B attached to this Agreement (the "Development"), which Development lies entirely within the City's extraterritorial jurisdiction ("ETJ"). C. Article VII of the Utility Agreement provides that the Parties will enter into this Contract to effectuate the future transfer of retail water and/or wastewater service rights for the Development 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 "Purchaser" means the City. 1.03 "Party" means, individually, the City, Owner, District or Aqua Texas, and any pennitted successors and assigns. 1.04 "Seller" means the District, Aqua Texas, or Owner, and each of their permitted successors and assigns, to the extent that each of those Parties or such successors or assigns owns all or any interest in the Property, as defined in Section 2.02, at the time the Option is exercised under this Contract. Brookfield 13uy-Out Option Contract Page 1199540-1 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 Utility Agreement. 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 in the Brookfield Development, as it may now exist, or be acquired or constructed by Seller at any time during the Option Period (the "Option") 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 wastewater collection facilities, including meters, lift stations, and other equipment, fixtures, improvements or appurtenances used to provide wastewater service to the Development, and located inside the Development (collectively, "Wastewater Facilities"); C. all easements and rights-of-way inside the Development associated with the Water Facilities or Wastewater Facilities (the "Easements"); d. any tract of land within the Development owned by Seller and in use for the operation of the Water Facilities or Wastewater Facilities (the "Land"); e. account records and information for existing customers served by the Water Facilities and Wastewater Facilities (the "Account Information"); and f. surveys, plans and specifications in Seller's possession or control that relate to the Water Facilities or Wastewater Facilities (the "Documents"). 2.02 Property. 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 to purchase the Property at any time (a) after seventeen (17) years from the date of the first connection within the Development to the City's water system, or (b) at an earlier date if agreed in writing by the District and by Aqua Texas; but in any event Purchaser must exercise the Option (if at all) on or before thirty (30) years from the Effective Date of this Contract ("Option Period"). The Option, if exercised, must be exercised Brookfield Buy-Out Option Contract Pagc 2 1199540-1 simultaneously for both the Water and the Wastewater Facilities and the Land, Easements, Account Information and Documents related thereto. 2.04 Exercise Notice. Whenever Purchaser desires to exercise the Option, Purchaser must provide Notice to Seller during the Option Period of its desire to exercise the Option ("Exercise Notice"). The date on which Purchaser sends the Exercise Notice is called the "Option 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 Seller possesses (other than privileged communications or attorney work-product) regarding the Property, including but not limited to: environmental studies and reports; any permits required for the Water Facilities and Wastewater Facilities; all agreements granting or conveying the Easements; the Documents; and a complete and itemized inventory of any of the Property that is not described in or shown on the Documents. 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 Real Property Records of Denton County, Texas within thirty (30) days after the Effective Date of this Contract. ARTICLE III PURCHASE PRICE AND OPTION CONSIDERATION 3.01 Purchase Price. When the Option is exercised pursuant to this Contract, the consideration ("Purchase Price") for the entirety of the Property purchased pursuant to the Option is TEN DOLLARS ($10.00). 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. The 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-the-ground land Brookfield 13uy-out option Contract Page 3 1199540-1 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 the Option Period. From time to time during the Option Period, Purchaser shall have the right to obtain, at Purchaser's expense, an inspection, 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 during the 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. 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 reasonably 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 preserve 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 5.05 to remove any Prohibited Encumbrance. ARTICLE V CLOSING 5.01 Time of Closiny-. The closing ("Closin ") 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 or place as the Parties may mutually determine ("Closing,Date' 5.02 Requirements of Seller. For all of the Property that is the subject of the Exercise 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 Still of Sale and Assignment in substantially the same form as that attached as Exhibit D to this Contract, 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 Wastewater Facilities, the Account Information, and the Documents; (b) a Special Warranty Deed executed and acknowledged by each Seller as its interests may appear, conveying to Purchaser good and Pagc 4 Brookticld my-Out option Contract 1199540-1 indefeasible fee simple title to the Land and subject to all matters of record; (c) an Assignment of Easements, 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 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. All conveyances made in connection with this Agreement shall be made "AS IS, WHERE IS, WITH ALL FAULTS" and such language shall appear in the conveyance. Each Party shall sign only those documents conveying property in which such Party has an ownership interest:. 5.03 Requirements of Purchaser. Purchaser shall deliver or cause to be delivered to Seller at Closing all of 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. 5.04 Termination of Leases. Upon completion of the Closing, Seller shall terminate, as of the Closing Date, any and all leases and operating agreement's between Aqua Texas and the District or the Owner 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 Purchaser, at its sole option, is entitled to (i) enforce specific performance of Seller's obligations under this Contract; or (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 VI MISCELLANEOUS 6.01 Form of Easement within the Development. Before granting any Easement to the District or Aqua Texas, Owner shall submit to Purchaser for its review and approval (which approval by Purchaser shall not be unreasonably withheld) Owner's proposed form of Easement for water and wastewater lines and related of thefacilitles and servient tenement consents m advance to ae Easement ny must provide that the underlying landowner future assignment of such Easement by Seller to Purchaser. After Purchaser has approved the form of water and wastewater Easement, 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 Utility 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 1'age 5 Brookfield Buy-Out Option Contract 1190540-1 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 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. 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 Aqua Texas: Aqua Utilities, Inc. dba Aqua Texas, Inc. Attn: Vice-President 1106 Clayton Lane, Ste. 40OW Austin, Texas 78723 FAX: (512) 263-5624 Aqua Utilities, Inc. dba Aqua Texas, Inc. Attn: Chief Legal Officer 762 West Lancaster Ave. Bryn Mawr. Pennsylvania 19010 Brookfield 13uy-Out option Contract Pagc 6 1199540-1 FAX: (610) 520-9127 To the District: South Denton County WCID No. 1 c/o: Crawford & Jordan, LLP Attn: Christopher Jordan 19 Briar Hollow Lane, Suite 245 Houston, Texas 77027 FAX: (713) 621-3909 To Owner: Brookfield Acquisitions, L.P. Attn: Ross Calhoun 1221 I.H. 35E, Suite 200 Carrollton, Texas 75006 FAX: (469) 892-7202 6.04 City Consent and Approval. 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 discretion, provided that such action is not arbitrary or unreasonable. 6.05 Binding Effect and Assiariment. 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 Utility Agreement. Further, this Contract must be assigned at the same time and to the same entity as the Utility Agreement. 6.06 Amendment. This Contract may be amended only with the written consent of all Parties and with approval of the governing bodies of the City and the District. 6.07 Severability. The provisions of this Contract are severable and, 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 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. Brookfield BLIN-Out Option Contract Pagc 7 119940-1 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 showing the Brookfield Development Exhibit B Legal description of the Brookfield Development Exhibit C Memorandum of Buy-Out Option Contract Exhibit D Bill of Sale and Assignment 6.12 Effective Date. The Effective Date of this Contract is January 25, 2011. ATTEST: CITY OF FORT WORTH By: Marty Hendrix City Secretary (print name) Title: Date: APPROVED AS TO FORM AND LEGALITY: Assistant City Attorney Page K Brooklicid BLIV-OUI Option Contract 1199540-1 ATTEST: AQUA UTILITIES, INC. dba AQU TEXAS, // INC. Al v �� B Corporate Secretary Robe L. Laughman, Preside Date: January 13, 2011 BROOKFIELD ACQUISITIONS, L.P., a Texas limited partnership By:MMM Ventures, LLC, a Texas limited liability company Its: General Partner By: 2M Ventures, LLC, a Delaware limited liability company Its: Manager zj I By: `z` Mehrdad Moayedi Title:Governing Person Date: —7 r -\ e-, (I SOUTH DENTON COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 1 ��; By: _✓, 44 (print name) Title: Date: ) ' , 1 i Brookfield Buy-Out Option Contract Page 9 1199540-1 Exhibit A Map Showing the Brookfield Development I A rn - , I � i i b..�OUN 1Y LINE"-TR15. 1 d. r- n I � • r 0 YOA PA4 L / If 1 C. I 1� 7 -- I I. l Exhibit n to Pngc 1311y-Out Option Contract Exhibit B Legal Description of the Brookfield Development BEING a tract of land located in the WILLIAM C. HALLMARK SURVEY, ABSTRACT NO. 518, Denton County, Texas and being all of a tract of land described as Tract 1 and 2 in Deed to Brookfield Acquisitions, L.P., recorded in Document Number 2007-45036, Deed Records, Denton County, Texas and being more particularly described as follows: BEGINNING at a concrete monument with a 1/2 inch iron rod found in the North right-of-way line of State Highway No. 114, a 100 foot right-of-way, at the Southeast corner of said Tract 2; THENCE North 89 degrees 31 minutes 05 seconds West, along said North right-of-way line, a distance of 1,026.70 feet to a 1/2 inch iron rod with a yellow plastic cap stamped "DAA" set at the Southeast corner of a tract of land described in Deed to Willow Bend 114, recorded in Document Number 2005-8893, Deed Records, Denton County,Texas; THENCE North 00 degrees 19 minutes 46 seconds East, a distance of 2,518.47 feet to a 1/2 inch iron rod with a yellow plastic cap stamped "5439" found at the Northeast corner of Lot 13, Block A of WILLOW SPRINGS SUBDIVISION, an Addition to Denton County, Texas according to the Plat thereof recorded in Cabinet D, Page 317, Plat Records, Denton County,Texas; THENCE South 89 degrees 59 minutes 13 seconds West, along the North line of said Lot 13, a distance of 13.26 feet to a 1 inch iron rod found at the Southeast corner of a tract of land described in Deed to Robert B. Logan,recorded in Volume 515, Page 92, Deed Records, Denton County, Texas; THENCE North 00 degrees 14 minutes 58 seconds East, a distance of 1,563.70 feet to a 3/8 inch iron rod found at the Northwest corner of said Tract 1; 0.54 feet o a THENCE South 89 degrees 28 minutes seconds„EC&D" found attheNorthease of 6 comer oftsaidlTract h iron rod with a yellow plastic cap stamped 1; /2 inch THENCE South 00 degrees 15 minutes 25 seconds East, a distance the.most Easter184feet to a Southeasticorner iron rod with a yellow plastic cap stamped EC&D" found at of said Tract 1; THENCE North 89 degrees 36 minutes 34 seconds West, a distance of 2,150.81 feet to a 1/2 inch iron rod with a yellow plastic cap stamped "EC&D" found at.. an inner ell corner of said Tract 1; THENCE South 00 degrees 08 minutes 43 seconds West, a distance of 1,322.76 feet to the POINT OF BEGINNING and containing 231.579 acres of land, more or less. Fxhibit 13 to Page 1 Buy-Out Option Contract i Exhibit C Memorandum of Buy-Out Option Contract STATE OF TEXAS § KNOW ALL BY THESE PRESENTS: COUNTY OF DENTON § This Memorandum of Buy-Out Option Contract ("Memorandum") is effective as of , 2009, by and among the City of Fort Worth, Texas, a home-rule municipal corporation situated in Tarrant, Denton, and Wise Counties, Texas, acting by and through its duly authorized Assistant City Manager ("Purchaser"); Brookfield Acquisitions, L.P., a Texas corporation doing business as Aqua limited partnership ("Owner'); Aqua Utilities, Inc., a Texas Texas, Inc. ("Aqua as"); and the South Denton County Water Control and Improvement District No. 1 (the "District") (collectively, "Seller"). A. Under that certain Buy-Out Option Contract for Brookfield Development dated as of , 2009 ("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 and wastewater utility service to, and located within, that certain real property development known as "Brookfield" consisting of 231.579 acres of land in Denton County, Texas, as more described EXHIBIT e attached hereto ("Development"). The period during �hh Purhasrmabexercisethe ears after the effective date of the begins at several possible points in time and ends thirty (30) y Contract ("Option Period"). Purchaser's exercise of the Option is governed by the terms and conditions of the Contract. and rding this B. Seller and Purchaser are executing, he Contacnowledgracgt,and of theoOption that Memorandum to provide public notice of the existenceof 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 bythis affectthe terms ordCondrtion s of the in this Memorandum may be deemed—to alter, amend or otherwise Contract. Exhibit C to Pagc I Buy-Out Option Contract ;I EFFECTIVE as of the date set forth above. ATTEST: CITY OF FORT WORTH By: Marty Hendrix City Secretary (print:name) Title: Date: APPROVED AS TO FORM AND LEGALITY: Assistant City Attorney ATTEST: AQUA UTILITIES, INC. dba AQUA TEXAS, INC. By: Corporate Secretary (print name) Title: Date: BROOKFIELD ACQUISITIONS, L.P., a Texas limited partnership By:MMM Ventures, LLC, a Texas limited liability company Its: General Partner By: 2M Ventures, LLC, a Delaware limited liability company Its: Manager By: Mehrdad Moayedi Title:Governing Person Date: 1:.11ibit C to Pagc 2 Buy-Out Option Contract SOUTH DENTON COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. I By: (print name) Title: Date: I y11ibit C to Page 3 13uy-Out Option C'onuact STATE OF TEXAS § COUNTY OF TARRANT § BEFORE ME, THE UNDF,RSIGNED AUTHORITY, on CITY s day OF FORT personally IWORTHre a as municipal corporation, on behalf of said City, known to me to be the person and officer whose name is subscribed to the foregoing d the�ame for the purposrandum of Oestandc consideratition on therenn acknowledged to me that he or she execute 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 20 Notary Public, State of Texas STATE OF TEXAS § COUNTY OF § BEFORE ME, THE UNDERSIGNED AUTHORITY, on this day personally appeared as of AQUA UTILITIES, INC. d/b/a AQUA TEXAS, INC., a corporation, on behalf of said corporation, known to me to be the person and officer whose name is subscribed to the foregoing Memorandum of Buy-Out Option Contract, and acknowledged to me that he or she executed the same for the purposes and consideration therein expressed, in the capacity therein stated, and as the act and deed of said corporation. GIVEN UNDER MY HAND AND SEAL OF OFFICE this the day of 20 Notary Public, State of Texas I-Ahibit C to Pagc 4 BLIV-Out Option('Untl'Ct I STATE OF 'TEXAS § COUNTY OF § BEFORE ME, THE UNDERSIGNED AUTHORITY, on this day personally appeared as of SOUTH DENTON COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 1, on behalf of said District, known to me to be the person and officer whose name is subscribed to the foregoing Memorandum of Buy- out Option Contract, and acknowledged to me that he or she 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 20 Notary Public, State of Texas STATE OF § COUNTY OF § BEFORE ME, THE UNDERSIGNED AUTHORITY, on this day personally appeared Mehrdad Moayedi, Governing Person of 2M Ventures, LLC, a Delaware limited liability company, Manager of MMM Ventures, LLC, a Texas limited liability company, in its capacity as General Partner of Brookfield Acquisitions, L.P., a Texas limited partnership, known to me to be the person and officer whose name is subscribed to the foregoing Memorandum of Buy-Out Option Contract, and acknowledged to me that he executed the same for the purposes and consideration therein expressed, in the capacity therein stated. GIVEN UNDER MY HAND AND SEAL OF OFFICE this the day of 20 Notary Public, State of Lxhibit C'to Pagc 5 BUS"011t Option Contract Exhibit A to Memorandum of Buy-Out Option Contract Legal Description of the Development BEING a tract of land located in the WILLIAM C. land d Abed as Tract d 2ABSTRACT NO. 518, Denton County, Texas and being all of a try ct ofBrookfield Acquisitions, L.P., recorded in Document Number 2007-45036, Deed Records, Denton County, Texas and being more particularly described as follows: BEGINNING at a concrete monument with a�/02 lwa iron a the Southeast comer North of said Tract 2y line of State Highway No. 114, a 100 foot right-of-way, THENCE North 89 degrees 31 minutes OS secwith a yellow plasticds West, along sais aporth right-of-way stamped 'DAA"set at distance of 1,026.70 feet to a 1/2 inch iron rod y the Southeast corner of a tract of land described Deed to Denton County,Willow S Bend114,recorded in Document Number 2005-8893, Deed Records, THENCE North 00 degrees 19 minutes 46 seconds East, �die Northeast tance of 18.47omer eet Loo 13/Block inch iron rod with a yellow plastic cap stamped 5439 found a A of WILLOW SPRINGS SUBDIVISION, an Addition Records, Det County, Taxa ton County, Texas according to the Plat thereof recorded in Cabinet D, Page 317, PlatTHENCE South 89 degrees 59 minutes 13 secondsest, along l ngt the hrNorth atract of lanne of said d t 13, a distance of 13.26 feet to a 1 inch iron rod found at the Soudescribed in Deed to Robert B. Logan, recorded in Volume 515,Page 92, Deed Records, Denton County, Texas; ds East, a distance of 1,563.70 feet to a 3/8 inch THENCE North 00 degrees 14 minutes 58 secon iron rod found at the Northwest corner of said Tract 1; THENCE South 89 degrees 28 minutes 37 seconds East, ad ist Ice of 3,160.54 f t o a 1/2 inch iron rod with a yellow plastic cap stamped EC&D found 1; THENCE South 00 degrees 15 minutes 25 seconds Easndistance d at the most Easterly Southeast l/2 inch corner iron rod with a yellow plastic cap stamped EC&D fou of said Tract 1; THENCE North 89 degrees 36 minutes 34 seconds West, a distnd ance f 2,1510181 feert to said inch iron rod with a yellow plastic cap stamped EC Tract 1; THENCE South 00 degrees 08 minutes 43 seconds West, a distance o 1, 22.76 feet to the d POINT OF BEGINNING and containing 231.579 acres of land, 1:xhibil C to Page 6 11111-Out Option Contract I Exhibit D BILL OF SALE AND ASSIGNMIE:NT THIS BILL OF SALE AND ASSIGNMENT ("Assi nment"), effective for all purposes as of _, (the "Effective Date"), is from Brookfield Acquisitions, L.P., a Texas limited partnership; Aqua Utilities, Inc., a Texas corporation doing business as Aqua Texas, Inc.; and South Denton County Water Control and Improvement District No. 1, or any district resulting from the conversion or division of such district (individually and collectively, "Assignor") and is to the City of Fort Worth, Texas, a home-rule municipal corporation situated in Tarrant, Denton, and Wise Counties, Texas, ("Assignee"). Concurrently with this Assignment, the Assignor, as Seller, and Assignee, as Purchaser are executing a Special Warranty Deed transferring any tract of land owned by Assignor and in use for the operation of the Water or Wastewater Facilities (the "Land") described in Exhibit A to Assignee. It is the desire of Assignor to hereby ASSIGN, TRANSFER and CONVEY to Assignee all fixtures, fittings, appliances, apparatus, equipment, machinery and other items of personal property, affixed or attached to, or placed or situated upon, the Land and any and all other facilities, rights, contracts, documents, or appurtenances as more fully described below. FOR AND IN CONSIDERATION of the sum of Ten Dollars and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged and confessed, Assignor hereby GRANTS, BARGAINS, SELLS, TRANSFERS, ASSIGNS and CONVEYS unto Assignee all of the following assets (collectively, the "Assets," including, without limitation, the specific items listed on Exhibit B): 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 231.579-acre mixed use, master-planned community known as Brookfield (the "Development"), and located inside the Development (collectively, "Water Facilities"); b. all wastewater collection facilities, including meters, lift stations, and other equipment, fixtures, improvements or appurtenances used to provide wastewater service to the Development, and located inside the Development (collectively, "Wastewater Facilities"); C. account records and information for existing customers served by the Wastewater Facilities and Water Facilities (the "Account Information"); d. surveys, plans and specifications in Seller's possession or control that relate to the Water Facilities or Wastewater Facilities (the "Documents"); and I-xninit 1)to Pagc I Mly-Out Option Contract e. any and all other incidental rights, leases, contractual rights, or otherwise related to the Water Facilities, Wastewater Facilities, Account Information, or Documents (the "Contractual Rights"). ON AND SUBJECT TO THE FOLLOWING TERMS AND CONDITIONS: I. Warranty of Title. Assignor severally agrees to warrant and defend title to the Assets unto Assignee, its successors and assigns forever, as against the claims and demands of all persons claiming or to claim the same or any part thereof. 2. Counterpart Execution. Assignor and Assignee may execute this Assignment in multiple counterparts, each of which shall constitute an original hereof, and the execution and delivery of any one of such counterparts by any signatory party shall have the same force and effect and shall be binding upon such signatory to the same extent as if the same counterpart were executed by all of the signatory parties. TO HAVE AND TO HOLD the Assigned Properties unto Assignee, its successors and assigns, forever. [THIS SPACE INTENTIONALLY LEFT BLANK/ SIGNATURES ON FOLLOWING PAGE] Lxhinit l)to Page 2 BLIV-Out Option Contract ASSIGNEE: ATTEST: THE CITY OF FORT WORTH, a Texas home-rule municipal corporation of Tarrant, Denton, and Wise Counties Printed Name: By: City Secretary Name: APPROVED AS TO FORM Title: AND LEGALITY: Date: Assistant City Attorney I:;Xhibit I)to Pagc 4 BU)-Out Option Contract I EXHIBIT A The Land [insert legal description and map] lixhihit t)to Page 5 Buy-Out Option Contract I EXHIBIT B The Assets I-yhibit l)to Page 6 Bu,,-Out Option Contract I Exhibit D Wholesale Treated Water Service Agreement Exhibit D to Brookfield Watcr and Wastewater Utility Servicc Agreement Pagc I WHOLESALE TREATED WATER SERVICE AGREEMENT BETWEEN THE CITY OF FORT WORTH, TEXAS, AND AQUA UTILITIES, INC. STATE OF TEXAS § COUNTY OF TARRANT § This Contract and Agreement ("Agreement") is made and entered into this _ day of , 20_, by and between the City of Fort Worth, a municipal corporation located in Tarrant County, Texas, acting by and through , its duly authorized Assistant City Manager, hereinafter called "Fort Worth," and Aqua Utilities, Inc., a Texas corporation doing business as Aqua Texas, Inc., hereinafter called "Customer," and hereinafter collectively referred to as the "Parties". WHEREAS, Fort Worth has provided at its own expense, and now owns, operates and maintains facilities for processing and distributing a large supply of surface water, and at the present time, is qualified to furnish and deliver treated water, both within and without the corporate boundaries of Fort Worth; WHEREAS, Customer has provided at its own expense and now owns, operates, and maintains a distribution system, and furnishes water service to the customers within the boundaries of Certificate of Convenience and Necessity("CCN")No. 11157; WHEREAS, Customer, Fort Worth, and Brookfield Acquisitions, L.P., a Texas limited partnership, have entered into that certain Brookfield Water and Wastewater Utility Service Agreement (City Secretary Contract No. _) with respect to water service to the approximately 231.579-acre Brookfield development in the City's extraterritorial jurisdiction (the "Development") pursuant to which Customer will enter into this Agreement with the City to purchase water to serve the Development; WHEREAS, it is deemed to be in the best interest of both Fort Worth and Customer that the Parties enter into a mutually satisfactory agreement by means of which Customer may obtain from Fort Worth a supply of treated water at a reasonable rate to serve the Development; WHEREAS, by the execution of this Agreement, neither Fort Worth nor Customer will surrender any of its rights to the ownership and operation of its present water production and distribution facilities; WHEREAS, Customer desires to continue to contract for the purchase of treated water and Fort Worth desires to continue to sell treated water to Customer; WHEREAS, Customer and Fort Worth desire to provide for reasonable wholesale contract rates for the purchase of treated water sufficient to assure confidence in the financial soundness of the Fort Worth utility, adequate to maintain and support the utility's credit and sufficient to enable bort Worth to raise the money necessary for the proper discharge of"its public duties in the provision of water service; and Agreement for Water Service For Special Water Utility Districts 1198845-1 WHEREAS, Chapter 552 of the Texas Local Government Code authorizes Fort Worth and Customer to enter into this Agreement. NOW, 'THEREFORE, KNOW ALL BY THESE PRESENTS that for and in consideration of the mutual covenants, promises and agreements contained herein, Fort Worth and Customer do hereby covenant and agree as follows: Table of Contents ARTICLE1. Definitions........................................................................................................... 6 1.1 Annual Consumption.................................................................................................... 6 1.2 Average Daily Use........................................................................................................ 6 1.3 Calendar Day ................................................................................................................ 6 1.4 Capital Improvements................................................................................................... 6 1.5 Chapter 395................................................................................................................... 6 1.6 Customer's Service Area.............................................................................................. 6 1.7 Customer System.......................................................................................................... 6 1.8 Delivery Facility ........................................................................................................... 6 1.9 Director......................................................................................................................... 6 1.10 Emergency..................................................................................................................... 6 1.11 Equivalent Meters or EM.............................................................................................. 6 1.12 Facility Expansion ........................................................................................................ 7 1.13 Fiscal Year.................................................................................................................... 7 1.14 Fort Worth..................................................................................................................... 7 1.15 Fort Worth System........................................................................................................ 7 1.16 Impact Fee..................................................................................................................... 7 1.17 Maximum Day Demand................................................................................................ 7 1.18 Maximum Hour Demand.............................................................................................. 7 1.19 MG and MGD............................................................................................................... 7 1.20 Parties............................................................................................................................ 7 1.21 Rate of Use Charge....................................................................................................... 7 1.22 Raw Water Charge........................................................................................................ 7 1.23 Return Water................................................................................................................. 7 1.24 Service Charge.............................................................................................................. 7 1.25 Street Rental.................................................................................................................. 8 1.26 Stand-by Charge............................................................................................................ 8 1.27 System Cost .................................................................................................................. 8 1.28 TCEQ............................................................................................................................ 8 1.29 Treatmcnt, Pumping and Transmission Charge............................................................ 8 1.30 Volume Charge............................................................................................................. 8 ARTICLE 2. Delivery of Water ............................................................................................... 8 2.1 Delivery......................................................................................................................... 8 2.2 Acceptance and Payment.............................................................................................. 8 A-reement for Water Service 2 ror Special Water Utility Districts 1198845-I 2.3 Operations..................................................................................................................... 8 2.4 Raw Water Contract...................................................................................................... 9 2.5 Water Use Restrictions and Conservation .................................................................... 9 2.6 Requirements of 30 Tex. Admin. Code Chapter 288.................................................... 9 2.7 Consultation with WCAC........................................................................................... 10 ARTICLE 3. Location and Maintenance of Measuring; Devices.............................................. 10 3.1 Metered Water ............................................................................................................ 10 3.2 Point(s) of Delivery..................................................................................................... 10 3.3 Cost of New or Additional Connections..................................................................... 10 3.4 Check Meter................................................................................................................ 11 ARTICLE4. Meters................................................................................................................ 11 4.1Testing......................................................................................................................... 11 4.2 Corrections.................................................................................................................. 11 4.3 Requested Testing....................................................................................................... 11 4.4 Out of Service Meter................................................................................................... 12 ARTICLE 5. Meter Reading and Billing................................................................................. 12 5.1 Reading Meters........................................................................................................... 12 5.2 Records ....................................................................................................................... 12 5.3 Multiple Meters........................................................................................................... 12 5.4 October Billing............................................................................................................ 12 5.5 Billing and Payment.................................................................................................... 12 5.6 Billing Disputes .......................................................................................................... 12 ARTICLE6. Rates.................................................................................................................. 13 6.1 Method of Rate Determination. .................................................................................. 13 6.2 Rates to be Used.......................................................................................................... 14 ARTICLE 7. Payment for Water............................................................................................ 15 7.1 Annual Payment.......................................................................................................... 15 7.2 Withdrawal Rate.......................................................................................................... 16 7.3 Monthly Payments...................................................................................................... 16 7.4 Total Annual Payments............................................................................................... 16 7.5 Rate of Use Charge...................................................................................................... 17 7.6 Applicability of Stand-by Charge................................................................................. 17 ARTICLE 8. Effective Date .................................... ARTICI.,E 9. Term.................................................................................................................. 18 ARTICLE 10. Rights-of-Way................................................................................................... 18 ARTICLE 11. TCEQ Public Water Supply Approval ............................................................... 18 ARTICLE 12. Resale of Water.................................................................................................. 18 12.1 Outside Service Area .................................................................................................. 18 12.2 Exceptions................................................................................................................... 19 ARTICLE 13. Sanitary Sewer Facilities.................................................................................... 19 ARTICLE 14. Additional Wholesale Customers....................................................................... 19 ARTICLE 15. Wholesale Customer Advisory Committee........................................................ 19 ARTICLE16. Impact Fees........................................................................................................ 19 16.1 Calculation and Payment of Impact Fees.................................................................... 19 16.2 Multiple Surface Water Providers .............................................................................. 20 n-recmcnt for Water Service 3 For Special Water Utility Districts 11988.1�_I 16.3 Use of Impact Fees...................................................................................................... 20 16.4 Impact Fee Report....................................................................................................... 20 16.5 No Waiver................................................................................................................... 20 16.6 CIFC............................................................................................................................ 20 16.7 Capital Improvements Plan......................................................................................... 21 16.8 Dissemination of Documents...................................................................................... 21 16.9 Audited Financial Statement....................................................................................... 21 16.10 Current Impact Fees.................................................................................................... 21 16.11 Changes to Chapter 395.............................................................................................. 21 ARTICLE 17. Breach, Tennination and Other Remedies.......................................................... 21 17.1 "Termination by Mutual Consent................................................................................. 21 17.2 Termination for Material Breach................................................................................ 22 17.3 'Tennination for Repeated Breach............................................................................... 22 17.4 Material Breach........................................................................................................... 22 17.5 Notice and Cure .......................................................................................................... 22 17.6 Notice and Cure for Nonpayment of Impact Fees ...................................................... 23 17.7 Notice and Cure for Breach of Water Use Restrictions and Conservation................. 23 17.8 Failure to Provide Notice of Withdrawal Rate under § 7.2 ........................................ 23 17.9 Effect of Termination.................................................................................................. 23 17.10 No Waiver by Fort Worth........................................................................................... 23 17.11 No Waiver by Customer............................................................................................. 24 ARTICLE 18. Ownership and Liability..................................................................................... 24 18.1 No Joint Venture......................................................................................................... 24 18.2 Liabilities .................................................................................................................... 24 18.3 Contractors.................................................................................................................. 24 ARTICLE19. Force Majeure.................................................................................................... 24 19.1 Notice and Suspension................................................................................................ 24 19.2 Definition.................................................................................................................... 25 ARTICLE20. Notices............................................................................................................... 25 20.1 Required Notice.......................................................................................................... 25 20.2 Delivery and Receipt................................................................................................... 25 20.3 Change of Address Notices......................................................................................... 25 ARTICLE 21. Inspection and Audit.......................................................................................... 26 ARTICLE22. Miscellaneous.................................................................................................... 26 22.1 Favored Nations.......................................................................................................... 26 22.2 Suspension of Rate of Use Charges.............................................................................. 26 22.3 Water to Adjacent Areas............................................................................................. 26 22.4 Subject to I,aws and Permits....................................................................................... 26 22.5 Entry on Customer's Premises.................................................................................... 27 22.6 Alternative Dispute Resolution................................................................................... 27 22.7 Information ................................................................................................................. 27 22.8 Assignment ................................................................................................................. 28 22.9 No Waiver................................................................................................................... 28 22.10 VENUE......................................................................................................................... 28 22.11 C;onstruction................................................................................................................ 28 A-regiment for Water Service 4 for Special Water Utility Districts 1198345-1 22.12 Severability................................................................................................................. 28 22.13 Use of Return Water................................................................................................... 28 22.14 System Regulatory Actions......................................................................................... 29 22.15 Additional Contract Terms ......................................................................................... 29 22.16 Exhibits....................................................................................................................... 29 A-rcement for Water Service 5 For Special Water Utility Districts 1198845-1 ARTICLE 1. Definitions The following definitions, when capitalized, apply throughout this Agreement: 1.1 Annual Consumption. The total quantity of water purchased under the terms of this Agreement by Customer during the Fiscal Year as determined by the difference in the annual October meter readings. 1.2 Average Daily Use. The Annual Consumption divided by the number of calendar days in the Fiscal Year year. 1.3 Calendar Day. The period from midnight of one day to 11:59 PM of the next day. 1.4 Capital Improvements. Any of the following facilities which provide utility services and benefits common to all customers (both retail and wholesale) and that have a life expectancy of three (3) or more years, whether such improvements are located within the jurisdictional limits (including the extra-territorial jurisdiction) of Fort Worth or Customer, and consisting of. water treatment facilities; metering facilities; control systems and appurtenances; storage facilities; pumping facilities; and all mains that are sixteen inches (16") and greater in diameter. Capital Improvements include the initial construction or the expansion of such facilities, as necessary to serve new development. 1.5 Chapter 395. Chapter 395 of the Texas Local Government Code, as it may be amended or re-codified from time to time. 1.6 Customer's Service Area. The area inside the Customer's Certificate of Convenience and Necessity within the Brookfield Development as shown on Exhibit A, except that the Customer may, with written notice to the Director, exclude a contiguous area that receives its entire water service from provider(s) other than Fort Worth. 1.7 Customer System. All necessary Customer mains and distribution facilities on the Customer's side of the meter from and beyond the point of delivery of treated water by Fort Worth. 1.8 Delivery Facility. Any facility necessary for the transmission of water from the Fort Worth System that is on the Customer's side of the point of delivery that is constructed specifically to allow Fort Worth to serve Customer. 1.9 Director. The Director of Fort Worth Water Department or his designee. 1.10 Emergency. A situation, event or condition created by unforeseeable mechanical failure, unprecedented high rate of treated water usage (such as might result from a major fire or a major water main break) or circumstances beyond the Party's reasonable control. 1.11 Fquivalent Meters or EM. A means of relating a large-use customer with a base (residential) use customer. Fort Worth Water Department uses 5/8 x '/4 inch meter capacity as an n-rccmcnt for Water Servicc 6 For Special Water Utility Districts 1 19x845-1 EM. The ratio of larger meter's capacity to the 5/8 x '/4 inch meter capacity is the number of EMs i-or each meter size. 1.12 Facility Expansion. The expansion of the capacity of an existing facility that serves the same function as an otherwise necessary new capital improvement, in order that the existing facility may serve new development. The term does not include the repair, maintenance, modernization, or an expansion of an existing facility to better serve existing development. 1.13 Fiscal Year. The fiscal year of Fort Worth, which is from October I" through September 30th. 1.14 Fort Worth. The City of Fort Worth, acting by and through its duly authorized Assistant City Manager, who may delegate to the Director. 1.15 Fort Worth System. The Fort Worth water treatment and distribution system. 1.16 Impact Fee. A capital contribution funding or recouping the cost of Capital Improvements necessitated by and attributable to new development, subject to and as provided in Article 16 of this Agreement. 1.17 Maximum Day Demand. The maximum quantity of water used by Customer during one calendar day of the Fiscal Year. 1.18 Maximum Hour Demand. The quantity of water used by Customer during the one hour of the Fiscal Year that more water passed through the meter or meters serving the Customer than during any other hour of the Fiscal Year, multiplied by 24 hours and expressed as MGD. 1.19 MG and MGD. MG is million gallons; MGD is million gallons per day. 1.20 Parties. Fort Worth and the Customer, or each individually. 1.21 Rate of Use Charge. The charge for Maximum Day Demand in excess of Average Daily Use and for Maximum 1-lour Demand in excess of Maximum Day Demand, as provided in § 7.5 and Exhibit C. 1.22 Raw Water Charge. The rate for 1,000 gallons charged by the Tarrant Regional Water District to Fort Worth for raw water to be sold to the Customer plus four percent (4%), representing Fort Worth system losses of four percent (4%). 1.23 Return Water. All water that is returned to Fort Worth via discharge into Fort Worth's wastewater system for treatment by Fort Worth's Village Creek Wastewater Treatment Plant or another wastewater treatment plant that is owned or operated (directly or through contract) by Fort Worth. 1.24 Service Charge. A fixed monthly charge per wholesale meter, as set forth in the annual cost-of-service rate study, designed to include a portion of Fort Worth Water Department's cost for wholesale customer billing and accounting. Agreement for Water Service 7 for Special Water Utilit, Districts 1 108845-1 1.25 Street Rental. The Street Rental charged to the wholesale customers of the Fort Worth System is intended to be compensation for use of public rights-of-way. The Street Rental is established at five percent (5%)of the revenue requirements, excluding Payment in Lieu of Taxes (PILOT). The Street Rental can not be decreased without the consent oil'Fort Worth in its sole discretion and, in the event of an increase, can only be increased in one percent (1%) increments once every five (5) years starting on the anniversary date of this Agreement in 2016, and shall never exceed the rate being collected from the natural gas franchised utility serving the City of Fort Worth or the rate collected from the retail water customers of Fort Worth, whichever is less. 1.26 Stand-by Charge. The fee set forth in § 7.1.3 and Exhibit B. The Stand-by charge is intended to allow a wholesale customer to rely on the Fort Worth System for stand-by delivery of water for the Customer's Emergency use only, as provided in § 7.6. 1.27 System Cost. System Cost, as provided in § 6.1.2. 1.28 TCF., . The Texas Commission on Environmental Quality or its successor agency. 1.29 Treatment Pumping and Transmission Charge. The rate, per 1,000 gallons used, regardless of rate of use, as determined by the annual cost-of-service rate study, and which 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. 1.30 Volume Charge. The combined total of the Treatment, Pumping and Transmission Charge plus the Raw Water Charge in effect for the current Fiscal Year. ARTICLE 2. Delivery of Water 2.1 Delivery. Fort Worth agrees, subject to the amount of raw and treated water available to Fort Worth, to furnish and sell to Customer treated water of potable quality meeting all applicable governmental standards, delivered under the normal operating pressure prevailing in the Fort Worth System at the Customer point or points of delivery mutually agreed upon, without guarantee of a specific minimum pressure. Mutually agreed point(s) of delivery on the Effective Date are shown on Exhibit A. 2.2 Acceptance and Payment. Customer agrees to accept delivery of and to pay for the water in accordance with the terms and conditions of this Agreement. Customer understands and acknowledges that Customer is responsible for maintaining water pressure in the Customer's System, and that maintaining a certain water delivery pressure requires use of storage or pumps on Customer's System. 2.3 Operations. Fort Worth is entitled at any and all times to install, repair, maintain, and replace any equipment or devices in the Fort Worth System. In an Emergency, Fort Worth may take necessary action (including reduction or cessation of water service to Customer) as necessary or appropriate to allow Fort Worth at all times to maintain a minimum pressure as required by law at all retail service locations directly served by Fort Worth, and Fort Worth is A� for Water Service $ For Special Water Utility Districts 1198845-1 excused from the requirements of§ 2.1 to the extent caused by an Emergency or by Force Majeure or Fort Worth's reasonable efforts to respond to such conditions. In the event of such service interruptions, Fort Worth shall make every reasonable effort to expedite the restoration of service in a timely manner, and shall not unreasonably interrupt, withhold or delay service to Customer. 2.4 Raw Water Contract. In accordance with the terms of Fort Worth City Secretary Contract No. 12720 between Fort Worth, the City of Arlington, the City of Mansfield, Trinity River Authority, and the Tarrant Regional Water District, this Agreement shall be deemed subordinate in all respects to the water requirements of the above contracting Parties as specified in Section 3 of that contract. 2.5 Water Use Restrictions and Conservation. 2.5.1 IP Fort Worth in any way restricts, rations or conserves the use of water throughout its CCN during an Emergency declared by the Director, then within 24 hours of being notified of the action of Fort Worth, Customer shall institute and apply the same restrictions and/or measures as to the use of the water by the customers of Customer. 2.5.2 if Fort Worth in any way restricts, rations or conserves the use of water throughout its CCN as authorized by the then Fort Worth City Council and adopted by ordinance, then Customer agrees to institute, apply and enforce the same rationing, conservation measures, or restrictions to the use of water by the customers of Customer for so long as any part of the total water supply of the Customer is being furnished by Fort Worth. Customer shall submit to Fort Worth, within sixty (60) days of the action taken by the City Council of Fort Worth, a copy of the Customer's city council and/or governing board resolution and/or ordinance adopting the same measures as Fort Worth. 2.5.3 If Customer fails to comply with its obligations under this § 2.5 then, in addition to the remedies available under Article 17, Fort Worth may install or adjust any rate of flow controllers necessary to physically achieve compliance, regardless of whether the rate of flow controller to be installed or adjusted is on Fort Worth's or Customer's side of the meter. 2.6 Requirements of 30 Tex. Admin. Code Chester 288 ("Ch. 288"). 2.6.1 As required by 30 Tex. Admin. Code § 288.5(1)(G), this Agreement requires Customer to develop and implement a water conservation plan or water conservation measures using the applicable elements of Tex. Admin Code Ch. 288. 2.6.2 As required by 30 Tex. Admin. Code § 288.22(a)(8), this Agreement requires that, in case of a shortage of water resulting from drought, the water to be distributed shall be divided in accordance with "Texas Water Code § 11.039. Agreement for Water Service 9 ForSpecial Water Utility Districts 1198845-1 2.6.3 To the extent that Customer fails to comply with § 2.5 above or meet any additional requirements under 30 Tex. Admin. Code Chapter 288, Customer agrees to implement and comply with Fort Worth's water conservation plans and measures and drought contingency plan until the Customer's own plans and measures are brought into compliance. 2.7 Consultation with WCAC. Except when the Director determines that emergency conditions require short-term restriction, conservation or rationing to meet all necessary water demands, Fort Worth agrees to consult with the Wholesale Customer Advisory Committee, in the development of any restriction, conservation, rationing, or drought contingency plans that the Director determines may be necessary to address operational constraints, whether or not required by any state or federal regulatory agency, or deemed advisable by the Wholesale Customer Advisory Committee to manage long term System Costs, except where emergency conditions may dictate short-term restriction, conservation or rationing requirements as may be determined by the Director to meet all necessary water demands. ARTICLE 3. Location and Maintenance of Measuring Devices 3.1 Metered Water. All water furnished under this Agreement by Fort Worth shall be measured by one or more suitable meters equipped with continuous flow, chart recording devices, and telemetering equipment connected with the Fort Worth control center. All meters, recording devices, telemetering equipment and appurtenances (including any flow control equipment required by § 7.2) shall be approved and installed by Fort Worth. Customer shall pay for the meter vault and all metering equipment, including telemetering equipment to the Fort Worth control center, and appurtenances, plus the installation cost thereof. Fort Worth shall pay all costs associated with the operation and maintenance of said equipment and shall pay for the replacement of said equipment as necessary. Such costs, as well as charges for the telelink line and microwave transmitter and the power to operate same, shall be a System Cost. 3.2 Points) of Delivery. The point or points of delivery of treated water by Fort Worth shall be the meter vault corinection to Customer's side of the meter, and all necessary mains and distribution facilities from and beyond that point shall be the responsibility of Customer. The location of each meter shall be mutually agreed upon in writing by and between the Parties and the meter or meters shall not be moved or relocated except by mutual consent in writing by the Parties. 3.3 Cost of New or Additional Connections. Customer shall pay the cost of each new, enlarged or additional Customer connection to the Fort Worth System, including the cost of the wholesale meter and the Customer's proportionate share of any improvements required for that connection or related service to be provided at the delivery point. The Customer's cost shall be calculated in the same manner as the "developer's cost" for special facilities under Fort Worth's then-existing Water and Wastewater Installation Policy, as determined by the Director. The Customer will pay that amount to Fort Worth before making the new or additional connection to the Fort Worth System, and the amount shall not be a System Cost. This Section 3.3 is subject to A-reement for Water Service 10 For Special Water Utility Districts 119884S-1 the terms and conditions of Exhibit F hereto and Exhibit F shall control with respect to any conflict between the terms and conditions of this section and Exhibit F. 3.4 Check Meter. Either Party, at its own expense, may install a check meter to check or measure the volume of water passing the master meter, provided that, if such check meter is installed, the same rules and regulations relative to its operation, maintenance and reading shall apply as to the master meter being tested. ARTICLE 4. Meters 4.1 Te_ sting. Fort Worth shall routinely test for accuracy, and service and calibrate if necessary, the master meter at each point of delivery 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 Customer. Customer shall have access to the metering facilities at all reasonable times; provided, however, that any reading, calibration or adjustment to such metering equipment shall be done by employees or agents of Fort Worth, or other mutually approved third party calibration agent, in the presence of representatives of Customer and Fort Worth, if so requested by Customer. Notification of any proposed test shall be provided to the Customer at least seventy-two (72) hours prior to such test being conducted and Customer may observe such test, if so desired. 4.2 Corrections. Upon any calibration of a Wholesale Customer's meter, if it is detennined that the accuracy envelope of such 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 such 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. All meters will be properly sealed, and the seals shall not be broken unless representatives of both Parties have been notified and given a reasonable opportunity to be present. If the meter, after testing, is found to be in error outside the parameters established in this Agreement, the amounts due to or due from Fort Worth shall be determined based upon the prevailing wholesale rates which were in effect at the time the meter was determined to be malfunctioning. The amount due to or due from Fort Worth shall be payable within thirty (30) days from the date of receipt of the invoice for said amounts by Fort Worth or by Customer. In addition, the Wholesale Customer's volume and rate of use records shall be corrected, as determined by the meter testing. 4.3 Requested Testing. Customer shall have the right to request Fort Worth to test any meter(s), but no more frequently than quarterly. Upon any such request, Fort Worth agrees to perform its testing and calibration of the meter(s) with notice to Customer, and the Parties shall be entitled to jointly observe any testing, calibration, and adjustments that are made to the mcter(s), in the event such modifications are necessary. For such additional testing request, Fort Worth shall give Customer notice forty-eight (48) hours in advance ofthe time when that testing will occur. Customer shall pay the cost of the additional test requested for any meter(s) if the test shows that the meter(s) is accurate (within five percent (5%) registration). but Fort Worth Agreement for Watcr Service 1 1 For Special Watcr Utility Districts I I QSS4�-I shall pay the costs of-the additional test if the results indicate that the meter(s) is not accurate (in excess of five percent (5%) registration). 4.4 Out of Service Meter. If any meter used to determine the flow of treated water to Customer is out of service or out of repair so that the amount of water metered cannot be ascertained or computed from reading the meter, then the water delivered during the period that the meter is out-of-service or out of repair shall be estimated and agreed upon by the Parties upon the basis of the best data available. The basis for estimating such flow includes, but is not limited to, extrapolation of past patterns of flow for that metering station under similar conditions. If the Parties cannot agree on the extrapolated estimate of water volume delivered, then agreement on the flow volume will be determined by § 22.6 dispute resolution. ARTICLE, 5. Meter Reading and Billing 5.1 Reading Meters. Dort Worth will read all meters provided for herein at monthly intervals, and the Parties shall have free access to read these respective meters daily, if either Party so desires. Each Party has the duty to give immediate notice to the other of any meter that it finds is not functioning properly. Upon such notice, repairs to such meter shall be made promptly. 5.2 Records. All readings of meters will be entered into the records maintained by Fort Worth. Customer shall have access to such records during reasonable business hours and shall be furnished with monthly readings for each point of delivery metering facility. 5.3 Multiple Meters. If Customer has more than one point of connection to the Fort Worth System, the sum of all meter readings and rates of flow shall be used for the purpose of calculating the water Volume Charge and the Rate of Use Charge. 5.4 October Billing. A review of water usage amounts by Customer 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 for the Fiscal Year just ended which 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 Maximum Hour Demand for the Fiscal Year just ended shall be furnished to Customer with the October billing. 5.5 Billing and Payment. Bills for water service shall be rendered to Customer monthly by Fort Worth, and shall be due and payable by Customer 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 Fort Worth shall first be applied to the past-due charges, if any, and thereafter to the current charges. 5.6 Billing Disputes. If Customer disputes a bill and is unable to resolve the difference informally, Customer shall notify the Director in writing. If the Director and Customer are unable to resolve the disputed bill, agreement on the bill will be detennined by § 22.6 dispute resolution procedures. Dispute of a bill shall not be grounds for non-payment. If a bill or other payment is not paid as specified in this Agreement, a finance charge often percent (10%) per Agreement for Water Service 12 Vor Special Water Utility Districts 1 198845-1 annum will be calculated from the date which the payment was required to be made. If a billing adjustment is agreed upon or otherwise established by dispute resolution, then the amount found to be incorrect will be credited to Customer's account together with an interest charge of ten percent (10%) per annum calculated from the date payment of the disputed bill was received. ARTICLE 6. Rates 6.1 Method of Rate Determination. 6.1.1 Wholesale water rates will be based upon an annual cost-of-service rate study with a rate study conducted every three years by an independent utility rate consultant as provided for in § 6.1.4. The independent utility rate consultant shall be selected by the Director from a list of five qualified firms submitted to the Director by the Wholesale Customer Advisory Committee. The cost of any such study shall be a System Cost. All cost-of-service studies shall be conducted utilizing the utility cost basis of determining revenue requirements applicable to the wholesale customer class. 6.1.2 The System Cost (i.e., the cost-of-service for the wholesale class) shall include allocated reasonable and necessary operation and maintenance expense; depreciation expense; a fair and reasonable return on allocated capital facilities as provided in § 6.1.3; general and administrative costs; commodity charges including the Raw Water Charge; the cost of treated water; transmission losses; Street Rental (calculated as provided in § 1.25); and Payment In Lieu of Taxes ("PIL,OT" calculated as provided in Exhibit D). To detennine 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. 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. The methodology shall be that used in the most recent wholesale water rate study completed and approved by the Fort Worth City Council before the Effective Date, which Customer acknowledges having received prior to executing this Agreement. 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 Fort Worth Water Department during reasonable business hours upon request by Customer. 6.1.3 Fort Worth shall be allowed to earn and recover in rates a rate-of-return on the rate base as described in § 6.1.2. That rate of return shall be equal to the weighted average imbedded cost of outstanding debt plus one and one-half percent (1-1/2%). The parties agree that this rate of return is reasonable. n-reement for Water Service 13 I or Special Water Utility Districts 1 193845-1 6.1.4 For the Fiscal Years beginning October 1, 2011, 2014, 2017, 2020, 2023 2026 and 2029, a detailed wholesale water rate study will be performed by an independent utility rate consultant selected by the Director in conformance with § 6.1.1. The same methodology used in the immediate previous rate study will be utilized by the rate consultant so selected. In the interim Fiscal Years between detailed rate studies, Fort Worth will adjust wholesale water rates annually, using the same methodology as the last detailed rate study, and will utilize the actual operating data for the twelve (12) month period ending September 30°i 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. 6.1.5 Changes in the wholesale water rate methodology will be allowed if recommended by a majority vote of the Wholesale Customer Advisory Committee and approved by the Fort Worth City Council. For purposes of this § 6.1.5, a majority is defined as any combination of Fort Worth wholesale customers that took more than fifty percent (50%) of the wholesale water delivered by Fort Worth during the immediate past Fiscal Year. 6.2 Rates to be Used. 6.2.1 The rates and charges to be effective upon approval of this Agreement shall be those calculated by the most recent cost of service study and adopted by the Fort Worth City Council to take effect during the current Fiscal Year. 6.2.2 The Raw Water Charge shall be increased or decreased when the raw water cost paid by Fort Worth for water available for treatment and sale to Customer is increased or decreased as determined by the Tarrant Regional Water District in accordance with Fort Worth City Secretary Contract No. 12720. 6.2.3 The Parties agree that services obtained pursuant to this Agreement are essential and necessary to the operation of Customer's waterworks facilities and that all payments made by Customer hereunder shall constitute reasonable and necessary operating expenses of Customer's waterworks and wastewater systems within the meaning of§ 1502.056 of the "Texas Government Code, and the provisions of any and all ordinances of Customer authorizing the issuance of any revenue bonds of Customer which are payable from its waterworks and wastewater systems. 6.2.4 Customer 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 (i) all of operation and maintenance expenses of such system, including specifically its payments under this Agreement; and (ii) all other amounts as required by law and the provisions of the ordinances or resolutions authorizing its revenue bonds or other obligations now or hereafter A-rcument for Water Service 14 For Special Witter Utility Districts 1 198815-1 outstanding, including the amounts required to pay all principal of and interest on such bonds and other obligations. 6.2.5 Customer understands that Fort Worth City Council has the right to annually revise the rates charged to cover all reasonable, actual, and expected costs. Revision of rates shall be pursuant to the provisions set forth in this Agreement. Fort Worth shall give Customer a minimum of six (6) months notice of intent to revise rates. Fort Worth will furnish members of the Wholesale Customer Advisory Committee a draft copy of the cost-of-service study of the proposed rates sixty (60) days prior to Fort Worth submitting a rate increase request to its City Council. Within thirty (30) days of receiving the draft study, the Wholesale Customer Advisory Committee will submit its written comments on the draft study to Fort Worth, and Fort Worth will respond to these comments as soon thereafter as possible. If the Wholesale Customer Advisory Committee has not provided its written comments within said period, the Wholesale Customer Advisory Committee is deemed to have accepted the proposed rates contained in the draft study, and Customer agrees that it will be bound by the rates as approved by the Fort Worth City Council. The rates approved by the Fort Worth City Council shall be the rates to be used in this Agreement for the succeeding Fiscal Year. ARTICLE 7. Payment for Water Payment of charges to Fort Worth for water used by Customer shall be made as follows: 7.1 Annual Payment. The annual payment will be the charges computed based on all water delivered by Fort Worth to Customer during the current Fiscal Year at rates set 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. IIowever, the minimum annual payment will be the greater of the following: 7.1.1 the current Fiscal Year Volume Charge times the current Fiscal Year Annual Consumption, plus the Service Charge, plus the current Fiscal Year Rate of Use Charges (Exhibit C, Example 1); or 7.1.2 the current Fiscal Year Volume Charge times the current Fiscal Year Annual Consumption, plus the Service Charge, plus the current Fiscal Year Rate of Use Charges 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 Ior the most recently completed three (3) Fiscal Years (to include the current Fiscal Year) (Exhibit C, Example 2); or 7.1.3 if applicable to Customer, a Stand-by Charge equal to: (a) twelve (12) months; A-regiment for Water Service 15 1=or Special Water Utility Districts i i(MW-1 (b) times the total number of EM units for all of the Customer's wholesale meters connected to the System; (c) times 28,800 gallons per day; (d) times a dollar amount equal to a three (3) year numerical average of the Treatment, Pumping and Transmission Charge per 1,000 gallons, using the Treatment, Pumping and Transmission Charge from most recent annual cost-of-service rate study performed by the independent utility rate consultant as provided in § 6.1.4 and the two years prior to the year of that study. 'Phis dollar average will remain in effect for purposes of calculating this § 7.1.3 Stand- by Charge until the next cost-of-service rate study is performed by an independent utility rate consultant as provided in § 6.1.4. Exhibit B presents an example calculation of the Stand-by Charge. 7.2 Withdrawal Rate. The rate at which water is withdrawn from the Fort Worth System by Customer shall be regulated by rate-of-flow controllers, pumps, or other approved methods. The rate of withdrawal shall be controlled so that the maximum rate shall not exceed 1.35 times the Maximum Day Demand experienced during the previous year unless Customer has notified the Director at least (6) months before the date of the anticipated increase in the Maximum Day Demand; provided, however that in an Emergency such as a line break, Customer shall advise the Director within 24 hours of the increase in the maximum rate of withdrawal. Customer shall furnish the Director with all pertinent infonnation regarding the proposed increase in maximum rate of withdrawal. The Director may waive the notice requirement if, in his sole opinion, that notice is not necessary to protect the interests of Fort Worth. 7.3 Monthly Payments. The monthly payment will be the sum of(a) plus (b) plus (c): (a) the greater of. (i) one-twelfth (1/12) of the amount calculated in § 7.1, or (ii) the Volume Charge times the actual volume of water taken that month; (b) one-twelfth (1/12) of the sum of the annual Rate of Use Charges, determined as provided in § 7.5 and Exhibit C; and (c) one-twelfth (1/12) of the sum of the Fiscal Year Service Charge. 7.4 Total Annual Payments. The total annual payment for water delivered to Customer shall be based on the annual and peak volumes delivered to Customer during the Fiscal Year, as determined by meters, flow recording devices or other approved methods, and calculated as provided in the annual payment provisions set forth above and in Exhibits B and C. The October monthly payment for September's usage shall contain any adjustments necessary to update the Rate of'Use Charge calculations as necessary to recover the Annual Payment Cor the Customer's actual withdrawals from the Fort Worth System (including Rate oC Use Charges for n-recment for Water Service 16 for special Water Utility Districts 1 198845-1 Maximum Hour and Maximum Day Demands) for the Fiscal Year just ended, during which the water usage occurred. Exhibit C provides examples of the Annual Bill Calculation. 7.5 Rate of Use Charge. As provided in §§ 7.1, 7.3 and 7.4 and shown in Exhibit C, Monthly Payments and the Annual Payment shall include Rate of Use Charges, unless the Stand- by Charge applies. The Rate of Use Charges consist of: (a) Maximum Day Rate of Use Charge, calculated by multiplying the "Excess Max Day Charge" per MGD from the annual cast-of-service rate study, times the Maximum Day Demand (in MGD) in excess of Average Daily Use (in MGD); and (b) Maximum Hour Rate of Use Charge, calculated by multiplying the "Excess Max Hour Charge" per MGD from the annual cost-of-service rate study, times the Maximum Hour Demand (expressed as MGD) in excess of Maximum Day Demand (in MGD). Exhibit C presents example Rate of Use Charge calculations. Rate of Use Charges are estimated by applying the current Fiscal Year Excess Max Day and Excess Max Hour Charges to the prior Fiscal Year's Maximum Day Demand, Maximum Hour Demand and Average Daily Use in the October through September bills, with adjustments in the October bill as necessary to recover the Annual Payment based on the Customer's actual withdrawals (including Rate of Use Charges for Maximum Hour and Maximum Day Demands) for the Fiscal Year just ended, during which the water usage occurred. 7.6 Applicability of Stand-by Charge. Customer is subject to the Stand-by Charge if the amount of the Stand-by Charge is the greater of the Annual Payment options listed in § 7.1. Customer is a Stand-by Customer if it receives water from the System for Emergency use only, and the Director has approved that use. A Stand-by Customer's obligations under this Agreement include the requirements of§ 3.1 for the location, approval and installation of meters. By execution of this Agreement and approval of the Stand-by service meter, Fort Worth agrees to provide the wholesale Emergency service through the approved meter to the Stand-by Customer, subject to the terms of this Agreement; however, notwithstanding § 2.1, delivery of water to a Stand-by Customer is subordinate to Fort Worth's other delivery obligations. Further, this Agreement does not grant or imply that the Standby Customer has reserved any water service, capacity or delivery from the System, other than for Emergency use as provided in this § 7.6. Any change in the Stand-by Customer's use from Emergency to non-Emergency must be approved in writing by the Director. Unless otherwise agreed in writing by Customer and Director, the Stand-by Customer is not required to pay the Impact Fees required by Article 16 until it requests or takes deliveries of water from the System that exceed the approved Emergency use. ARTICLE 8. Effective Date The effective date and time of this Agreement for all purposes is January 1, 2011 at 12:01 a.m. Upon the Effective date, the wholesale water service agreement then in effect between Fort Worth and the Customer is terminated and superseded by this Agreement. Agreement for Water Service 17 I:or Special Water Utility Districts 1198845-1 ARTICLE 9. Term This Agreement expires on September 30, 2031. It may be renewed on terms mutually agreeable to the Parties. ARTICLE 10. Rights-of-Way Customer shall grant, without charge to Fort Worth, such easements and rights-of-way along public highways or other property owned by Customer, as requested by Fort Worth, in order to construct or maintain mains or facilities within the Customer's Service Area to provide water to Customer and to other areas. Upon notice from Customer and at Fort Worth's expense incurred as a System Cost, Fort Worth will move such water mains or facilities located in such street rights-of-way, or other property owned by Customer when reasonably necessary to the performance of essential governmental duties by Customer. Fort Worth shall grant, without charge to Customer, such easements and rights-of-way along public highways or other property owned by Fort Worth, as requested by Customer, in order to construct and maintain water mains or facilities within Fort Worth to provide water to Customer. Upon notice from Fort Worth and at Customer's expense, Customer will move such water mains or facilities when located in such street rights-of-way or other property owned by Fort Worth when reasonably necessary to performance of essential governmental duties by Fort Worth. All work done by or on behalf of Fort Worth under this paragraph will be performed in accordance with specifications equal to those applying to work of a similar nature performed within Fort Worth, and the applicable Party will use its best efforts to restore the others property to as near original condition as feasible unless otherwise mutually agreed in writing. Fort Worth and Customer agree to coordinate the location of the mains and/or facilities in the other's easements and rights-of-way in order to prevent further conflicts insofar as is reasonably practicable. ARTICLE 11. TCEQ Public Water Supply Approval The Customer System shall be approved by the TCEQ during the life of this Agreement. If, at any time, the Customer System is not approved by the TCEQ, or if Customer does not have an active cross-connection control prograun, there shall not be any direct physical connection between the Fort Worth System and the Customer System unless an approved backflow prevention device has been provided and installed and this installation has been approved by the TCEQ. All expenses to provide and install backflow prevention device(s) will be borne by Customer. ARTICLE 12. Resale of Water 12.1 Outside Service Area. Customer agrees that it will not share facilities for water system use with any other governmental or corporate entity outside of Customer's Service Area without the express written consent of Fort Worth, which consent shall not be unreasonably withheld. Fort Worth neither recognizes nor approves any existing agreements entered into by Customer AL,,reement for Water Ser,ice 18 For Special Water Utility Districts 1195845-1 with other governmental or corporate entities outside of Customer's Service Area, unless expressly approved in writing by the Director before the Effective Date. 12.2 Exceptions. Only those existing connections outside of the Customer's Service Area shown in Exhibit E may continue. Customer agrees that it will not enter into any resale or transportation agreement other than as a part of its normal offering and supply of water to existing and future subscribers to its Customer System without the recommendation of the Wholesale Customer Advisory Committee and express written consent of Fort Worth. ARTICLE 13. Sanitary Sewer Facilities The Customer agrees that it will require all of its customers, who are provided water from the Fort Worth System, to have adequate sanitary sewage facilities meeting TCEQ requirements. ARTICLE 14. Additional Wholesale Customers Fort Worth will use its best efforts to provide an adequate water supply for all of its customers. Prior to the approval of additional wholesale customers, Fort Worth will obtain in writing reasonable assurances from the Tarrant Regional Water District that the projected ten (10) year water demands of the then-existing wholesale customers being served and any proposed additional customers can be fulfilled, and will charge the new customer an appropriate connection fee pursuant to § 3.3. Fort Worth will consult with the Wholesale Customer Advisory Committee and the Tarrant Regional Water District before contracting with additional new wholesale water customers. ARTICLE 15. Wholesale Customer Advisory Committee Customer's governing body shall annually appoint a representative to be a voting member of the Wholesale Customer Advisory Committee, whose purpose shall be to consult with and advise Fort Worth, through the Director, on matters pertaining to conservation, wholesale planning, improvements, grants, wholesale rate studies, administration, budgets, and additional wholesale customers, whether same be wholesale customers of Customer or Fort Worth. The Wholesale Customer Advisory Committee may establish bylaws governing the election of officers, meeting dates and other matters pertinent to its functioning. ARTICLE 16. Impact Fees 16.1 Calculation and Payment of Impact Fees. On a quarterly basis, Customer agrees to pay to Fort Worth an Impact Fee for each new or enlarged connection for water service made within Customer's Service Area served by the Fort Worth System. The Impact Fee to the Customer for each such connection shall be based upon the size of water meter and shall be assessed and collected by the City at 100% of the total maximum assessable amount of applicable impact fees as adopted by the City Council. Subject to the foregoing, the calculation of the Impact Fee shall be consistent with the Fort Worth ordinance adopting the Impact Fee in accordance with all applicable state and federal regulations, including Chapter 395, and shall include only those costs allowed under S 395.012 (or its amended or successor statute) that are associated with Capital A-recmcnt for Watcr Scrvice 19 For Spccial Water Utility Districts 1198845-I Improvements necessary to provide service to new development. Nothing within this Agreement shall be deemed to prevent either Fort Worth or Customer from charging their own retail customers' Impact Fees in excess of the Impact Fee authorized by this Agreement. This Section 16.1 is subject to the terms and conditions of Exhibit F hereto and Exhibit F shall control with respect to any conflict between the terms and conditions of this section and Exhibit F. 16.2 Multiple Surface Water Providers. If Customer receives surface water from more than one water provider for use by potable water customers within its Service Area, then the Customer's impact fees due to Fort Worth shall be proportionately reduced. The charge will be a fractional part of the Impact Fee imposed within Fort Worth for the same size of meter based on the ratio of the annual amounts of water purchased from Fort Worth to the total annual combined amount of surface water purchased from Fort Worth and the Customer's other surface water provider(s). For purposes of calculating this fractional part, this ratio will be the greater of the most recent prior annual ratio or the most recent 3 year average ratio occurring after the first Fiscal Year after the Effective Date. 16.3 Use of Impact Fees. As required by Chapter 395, Fort Worth agrees that all money remitted to it pursuant to this Article 16 will be placed in an interest bearing account to pay only for the cost of constructing Capital Improvements included in the Chapter 395 capital improvements plan, and will not be used for operation and maintenance expenses. Once expended, such funds and all interest earned thereon will be considered a "contribution" for rate setting purposes only. To the extent that the cost of any Capital Improvement is recovered through Impact Fees, it shall not be included in the System Cost. 16.4 Impact Fee Report. Customer shall provide to Fort Worth information that relates to the making of new and/or enlarged connections within its jurisdiction as may be requested by the Director, including building permits, with each quarterly payment required in this Article 16. 16.5 No Waiver. Neither Fort Worth nor Customer shall waive any Impact Fee due from new or enlarged connections to its respective system within its jurisdiction. However, either Fort Worth or Customer may pay such Impact Fee into the interest bearing Impact Fee account required by § 16.3. 16.6 CII'C. The Wholesale Customer Advisory Committee created pursuant to Article 15 shall select five (5) of its members to a subcommittee to be known as the Customer Impact Fee Committee ("CIFC"). As required by Texas Local Government Code § 395.052, at least every five (5) years, beginning June, 2014, or sooner, Fort Worth will update the land use assumptions and capital improvements plan upon which the Fort Worth Impact Fees are based, or make the determination under Chapter 395 that no update is required. Fort Worth shall submit a copy of the annual report of Fort Worth Impact Fee projects and expenditures to the Wholesale Customer Advisory Committee Rate Subcommittee. In June 2014 and at least every five years thereafter, the CIFC shall submit a list of five qualified engineers or planning consultants to the Director. The Director shall select a consultant from such list to assist Fort Worth in developing land use assumptions, identifying capital improvements, and formulating capital improvement plans and Impact Fees. The consultant shall be responsible to Fort Worth and its citizen's advisory committee, but shall also report to the CIFC. The cost of the consultant shall be deemed n-reement for Water Service 20 For Special Water Utility Districts 1198845-I a System Cost, except to the extent that such cost is recovered through Impact Fees. If the CIFC fails to submit a list of five consultants to Fort Worth, Fort Worth shall select the consultant. 16.7 Capital Improvements Plan. Fort Worth agrees that only the Capital Improvements as defined in § 1.4 shall be included in the capital improvements plan for the purpose of determining Impact Fees; provided however, Fort Worth may include other capital improvements for the purpose of determining Impact Fees to its own retail customers. Fort Worth shall not be required to include all of its capital improvements in its Chapter 395 capital improvements plan. The CIFC shall be responsible for working with Fort Worth and its consultants to determine the Capital Improvements to be included in the calculation of any Impact Fees. The CIFC shall recommend to the Wholesale Customer Advisory Committee which Capital Improvements should be included in the calculation of any Impact Fees. The CIFC shall also meet with Fort Worth's citizen advisory committee as such citizen's advisory committee reviews and considers land use assumptions, the capital improvements plan and Impact Fees. 16.8 Dissemination of Documents. Prior to the adoption of any land use assumptions, capital improvements plan, or Impact Fees assessed by Fort Worth, the CIFC shall be furnished a copy oi'the proposed land use assumptions, capital improvement plans or Impact Fees at least thirty (30) days prior to any scheduled hearing thereon. Any revised Impact Fee adopted pursuant to such updated capital improvements plan shall not take effect for a period of at least ninety (90) days after adoption by Fort Worth. 16.9 Audited Financial Statement. Upon request, Fort Worth shall make available to the Wholesale Customer Advisory Committee the most recent audited financial statement of the Fort Worth Water Department's records. 16.10 Current Impact Fees. Customer agrees to pay Impact Fees in the amounts determined pursuant to this Article 16. On the Effective Date, those impact fees are 100% of the maximum assessable Impact Fees most recently adopted by the Fort Worth City Council before the Effective Date. Thereafter the Impact Fees are those in effect by Fort Worth ordinance at the time the new or enlarged connection is made. This Section 16.10 is subject to the terms and conditions of Exhibit F hereto and Exhibit F shall control with respect to any conflict between the terms and conditions of this section and Exhibit F. 16.11 Changes to Chapter 395. Fort Worth and Customer agree that the methodology for the calculation of Impact Fees required by this Agreement shall be consistent with the methodology prescribed by Chapter 395. If that statutory methodology is amended or replaced by a new statute, the Wholesale Customer Advisory Committee may engage legal counsel to work with Fort Worth to propose amendments to this Agreement to conform it to such amendment or new statute. The reasonable cost of such legal counsel shall be a System Cost. ARTICLE 17. Breach. Termination and Other Remedies 17.1 Termination by Mutual Consent. This Agreement may be terminated in whole or in part by the mutual consent of Customer and Fort Worth. Fort Worth's decision on whether to Agreement f<n- Watcr SCI"VICC 21 For Special Water Utility Districts consent to termination remains within it's sole discretion; however, before consenting to termination, Fort Worth shall consult with WCAC regarding the circumstances of the proposed termination. 17.2 Termination for Material Breach. Notwithstanding anything in this Agreement to the contrary, any material breach by either Party to perform any of its duties or obligations under this Agreement, or to faithfully keep and perform any of the terms, conditions and provisions of this Agreement, shall be cause for termination of this Agreement by the non-breaching Party in the manner set forth in this § 17.2. Upon such breach, the non-breaching Party may notify the breaching Party of the non-breaching Party's intention to terminate this Agreement if the breaching Party fails to cure such breach within ninety (90) days from the date of the notice. The notice must include a reasonable description of the breach. The non-breaching Party shall notify the breaching Party in writing upon acceptance of the cure of any breach. If by the ninetieth (90th) day the breaching Party fails or refuses to cure such breach pursuant to the terms and conditions of this Agreement, then the non-breaching Party shall have the right to tenninate this Agreement with six months additional notice to the breaching Party. 17.3 Termination for Repeated Breach. Upon a second (or any repeated) breach of a similar nature by a Party and irrespective of any cure of such breach, the non-breaching Party may, after six (6) months notice to the breaching Party, terminate this Agreement. That notice must be provided within a reasonable time after the repeated breach that is the basis for the termination. 17.4 Material Breach. "fhe following breach, default or failure to perform a duty or obligation under this Agreement is a material breach: a. Failure to comply with §§ 2.5 or 2.6 requirements regarding rationing, conservation measures or restrictions; b. Failure to pay any bill, charge, or fee as required by this Agreement, including fees required under Article 16; C. Making any connection to the Fort Worth System at any point except as provided in §3.2; d. Failure to correct any potentially hazardous connection in accordance with the terms of Article 11, after notice delivered by certified mail; C. Failure to provide Fort Worth ingress and egress for purposes of operation and maintenance of any metering facility; f. Failure to provide Fort Worth rights-of-way as required herein; or g. Failure to provide Fort Worth an Impact Fee report as required in Article 16. All other breaches are deemed to be non-material. 17.5 Notice and Cure. In the event of a material or non-material breach, default or failure to perform a duty under this Agreement, the non-breaching Party may send a notice of such default to the breaching Party. The notice must include a reasonable description of the breach. if the breaching Party fails to cure the breach, default or failure within 60 days of that notice, then the non-breaching Party may give the breaching Party a second notice of its failure to cure the breach. Failure to cure the breach within 30 days after the second notice shall constitute a n-reement for Water service 22 f or special Water Utility [)istricts 1 198845-I repeated breach, and may result in termination of this Agreement as provided in § 17.3 for repeated breach. Fort Worth may, upon breach by a Customer, surcharge the Customer an amount developed and calculated by Fort Worth intended to reimburse Fort Worth for any damages each month, including 10% interest, until Customer cures that breach. Because failure to perform obligations under this Agreement cannot be adequately compensated in money damages alone, the Parties shall have available to them the equitable remedy of specific performance in addition to any other legal or equitable remedy as may be provided by law. 17.6 Notice and Cure for Nonpayment of Impact Fees. If the breach is based on the non- payment or underpayment of Impact Fees, then the Customer shall pay Fort Worth the amount of the non-payment or under-payment within 60 days of the notice required by §§ 17.2 or 17.5, plus interest at a rate oil' 10% of the amount owed, accruing from the time at which the payment was due. An additional charge of$500.00 will be added if no Impact Fee report was filed. 17.7 Notice and Cure for Breach of Water Use Restrictions and Conservation. If Customer breaches §§ 2.5 or 2.6, then the § 17.2 notice provisions do not apply and the Director, in his sole discretion, may, in writing, set such time in which the Customer shall cure the breach. if Customer fails or refuses to cure the breach within the stated time, then Fort Worth shall have the right to declare this Agreement terminated after six (6) months additional notice to Customer. 17.8 Failure to Provide Notice of Withdrawal Rate under � 7.2. Failure to provide § 7.2 notice, provided the Director did not waive notice requirements, will be considered a non- material breach of the Agreement and, in addition to other remedies available under this Agreement, shall result in an automatic surcharge in the amount specified in § 17.5 for such non- material breaches of the Agreement, without further notice requirements. 17.9 Effect of"Termination. Upon termination of this Agreement under this Article 17, all rights, powers, and privileges of Customer and Fort Worth under this Agreement shall cease and terminate, and neither Party shall make any claim of any kind whatsoever against the other Party, its agents or representatives, by reason of tennination or any act incident to termination, if the terminating Party acted reasonably and the termination was not unreasonable, or arbitrary and capricious. If this Agreement is not renewed before it expires, and the Parties are negotiating in good faith regarding the provisions of a new agreement, then the Parties may extend the date for termination, in writing that refers to this § 17.9 and is signed by both Parties. If this Agreement is not renewed, or if the Agreement is terminated by one of the Parties pursuant to this Article 17, then, as authorized by Texas Water Code § 11.036, this Agreement requires the Customer to develop alternative or replacement supplies before the expiration or termination of this Agreement; this requirement may be enforced by the equitable remedy of specific performance, sought by court order, in addition to any other legal or equitable remedy as may be provided by law. No continuation of the service obligation exists or will be implied after expiration or termination. 17.10 No Waiver by Fort Worth. Any failure by Fort Worth to terminate this Agreement, or the acceptance by Fort Worth of any benefits under this Agreement, for any period of time after a material breach, default or failure by Customer shall not be determined to be a waiver by Fort ���rccmcnt for Water Ser�icc 2 3 For Special water Utility Disti-icts 1193Rd -I Worth of any rights to terminate this Agreement for any subsequent material breach, default or failure. 17.11 No Waiver by Customer. Any failure by Customer to terminate this Agreement, or the acceptance by Customer of any benefits under this Agreement, for any period of time after a material breach, default or failure by Fort Worth shall not be detei7nined to be a waiver by Customer of any rights to terminate this Agreement for any subsequent material breach, default or failure. ARTICLE 18. Ownership and Liability 18.1 No Joint Venture. No provision of this Agreement shall be construed to create any type of joint or equity ownership of any property, any partnership or joint venture, nor shall same create any other rights or liabilities and Customer payments (whether past, present, or future) shall not be construed as granting Customer partial ownership of, pre-paid capacity in, or equity in the Fort Worth System. 18.2 Liabilities. Liabilities for damages arising from the proper treatment, transportation and delivery for all water provided hereunder shall remain with Fort Worth to the point of delivery and, upon passing through the meter, liability for such damages shall pass to the Customer, save and except that Fort Worth's sole responsibility is to provide to Customer water of a quality which meets state and federal drinking water standards. Each Party agrees to save, release and hold harmless the other Party from all claims, demands, and causes of action which may be asserted by anyone on account of the quality, transportation and delivery while water is in the control old such Party. This covenant is not made for the benefit of any third party. Fort Worth takes the responsibility as between the Parties for the proper treatment, quality, transportation, and delivery of all such water provided by it to the point of delivery. 18.3 Contractors. Agreements made and entered into by either Customer or Fort Worth for the construction, reconstruction or repair of any Delivery Facility shall include the requirement that the independent contractor(s) must provide adequate insurance protecting both the Customer and Fort Worth as co-insured. Such Agreement must also provide that the independent contractor(s) covenant to indemnify, hold harmless and defend both the Customer and Fort Worth against any and all suits or claims for damages of any nature arising out of the performance of such Agreement. ARTICLE 19. Force Majeure 19.1 Notice and Suspension. If by any reason of force majeure either Party shall be rendered unable, wholly or in part, to carry out its obligations under this Agreement, other than the obligation of the Customer to make payments required under the terms hereof, then if such Parties shall give notice and full particulars of such force majeure in writing to the other Party within a reasonable time after the occurrence of the event or cause relied on, the obligation of the Party giving such notice, so far as it is affected by such force majeure, shall be suspended during the continuance of the inability then claimed, but for no longer period, and such Party shall endeavor to remove or overcome such inability with all reasonable dispatch. Agreement for Water Service 24 For Special Water Utility Districts 1 198845-1 19.2 Definition. The term "force majeure," as employed herein, shall mean acts of God, strikes, lockouts or other industrial disturbances, acts of public enemy, orders of any kind of the government of the United States or the State of Texas, or any civil or military authority, insurrection, riots, epidemics, landslides, lightning, earthquake, fires, hurricanes, storms, floods, washouts, droughts, arrests, restraints of government and people, civil disturbances, explosions, breakage or accidents to machinery, pipelines or canals, partial or entire failure of water supply, and inability on the part of Fort Worth to deliver water hereunder or the Customer to receive water hereunder on account of any other cause not reasonably in the control of the Party claiming such inability. ARTICLE 20. Notices 20.1 Required Notice. Except in the case of an Emergency, any notice or other communication that is required, given or provided for under this Agreement shall be in writing, and addressed as follows: To Fort Worth: Water Director City of Fort Worth 1000 Throckmorton Street Fort Worth, TX 76102 To Customer: Aqua Utilities, Inc. dba Aqua Texas, Inc. Attn: Vice-President 1106 Clayton Lane, Ste. 400W Austin, 'Texas 78723 Aqua Utilities, Inc. dba Aqua Texas, Inc. Attn: Chief Legal Officer 762 West Lancaster Ave. Bryn Mawr, Pennsylvania 19010 With an additional copy to be given to a Customer representative, if designated in writing by Customer. 20.2 Delivery and Receipt. Notice shall be either (a) delivered personally, (b) sent by United States certified mail, postage prepaid, return receipt requested, (c) placed in the custody of a nationally recognized overnight carrier for next day delivery, or (d) sent via telecopy or facsimile (fax) transmission. Notice shall be deemed given when received if delivered personally or sent via telecopy or facsimile transmission with written confirmation of receipt; forty-eight (48) hours after deposit if sent by mail; and twenty-four (24) hours after deposit if sent by nationally recognized overnight carrier for next day delivery. 20.3 Change of Address Notices. Each Party shall provide notice in writing, as provided in § 20.1 of any change in its address. Agreement for Water Service 25 For Special Water Utility Districts 1198845-I ARTICLE 21. Inspection and Audit Complete records and accounts required to be maintained by each Party shall be kept 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. The responding Party shall make the records available promptly upon request. ARTICLE 22. Miscellaneous 22.1 Favored Nations. Fort Worth and Customer agree that if Fort Worth should enter into any future Agreement for supplying treated water to any municipality under more favorable terms or conditions than set forth herein, this Agreement shall be amended to provide the same terms and conditions with respect to the sale of treated water to Customer. 22.2 Suspension of Rate of Use Charges. During an Emergency it may be necessary that water be withdrawn from the Fort Worth System at a rate of usage in excess of the Customer's contractually established Maximum Daily Demand and Maximum Hour Demand. It is agreed that extra Rate of Use Charges that would normally be applicable shall not apply for such bona tide emergency withdrawals provided that Fort Worth is notified in writing within forty-eight (48) hours of the occurrence of the Emergency. In any event, the normally applicable Rate of Use Charges the Customer would have incurred had it not been an Emergency, plus the Volume Charges for all water delivered, shall be due and payable as described elsewhere in this Agreement. 22.3 Water to Adjacent Areas. At the request of the Director, Customer agrees to furnish water to areas and premises situated adjacent to the boundary of Customer and within the boundaries of Fort Worth, subject to the Texas Water Code and TCEQ regulations regarding service areas. The metered quantity of water used in this area each month by Fort Worth shall be the total of all individual customer meter readings. At the option of Customer or Fort Worth, a master meter may be installed where practicable at the expense of Fort Worth to meter all water used by Fort Worth under the terms of this § 22.3. The metered quantity of water furnished by Customer to Fort Worth shall be deducted from the total quantity of water withdrawn from the Fort Worth System by Customer before the charge for water service to Customer is computed in accordance with the payment computations set forth and based on the Volume Charge, the quantity of water so withdrawn from the Fort Worth System and, if the meter serving those customers has been equipped to measure it, Maximum Day Demand and Maximum Hour Demand. 22.4 Subject to haws and Permits. "I`his 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. Customer agrees to abide by any changes in this Agreement A-reement for Water Service 26 for Special Water Utility Districts 1 198845-1 made necessary by any new, amended, or revised state or federal regulation; however the Parties may not enact rules or laws that conflict with this Agreement. 22.5 Entry on Customer's Premises. Upon prior notice by the Director, Customer shall allow any duly authorized employee of Fort Worth who presents proper credentials to access any premises located within Customer's Service Area or served by Customer 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. Customer may elect to accompany the Fort Worth representative. To the extent permitted by law, Fort Worth agrees to be responsible to Customer for any damage or injury to person or property caused by the negligence of such duly authorized employee while such employee is in the course and scope of their employment. 22.6 Alternative Dispute Resolution. 22.6.1 The parties shall endeavor, but only to the extent permitted by applicable law and at no additional cost to Customer, to settle all disputes arising out of or relating to this Agreement by amicable negotiations. 22.6.2 Any and all disputes arising out of or relating to this Agreement that cannot be resolved informally will be submitted to mediation. The place of mediation shall be in Tarrant County, Texas. A mediator shall be jointly agreed to by both Parties, and the mediator selected shall have expertise in the sale and supply of treated water. Either Party may apply for injunctive relief until the mediation decision is rendered or the controversy is otherwise resolved. Either party may, without waiving any remedy under this Agreement, seek from any court having jurisdiction any interim or provisional relief that is necessary to protect the rights or property of that Party, pending the mediator's detennination of the merits of the controversy. Each Party shall initially bear its own costs and expenses; however, unless otherwise agreed in mediation, Fort Worth's costs in mediation, including expenses, reasonable attorneys' fees and other costs, shall be a System Cost. Nothing occurring during mediation shall be considered evidence in court. 22.6.3 If mediation is not successful, either Party may commence litigation to resolve the dispute. Fort Worth's litigation costs shall be a System Cost. 22.7 Information. If requested by the Director, Customer shall provide quarterly the following data or information: 22.7.1 Actual number of customer accounts consuming directly or indirectly from the Customer System within Customer's Service Area; 22.7.2 Classification of domestic and nondomestic accounts within its Customer's Service Area by number and percentage of accounts consuming directly or indirectly from Customer System within its Customer's Service Area; Agreement for Water Service 27 ror Special Water Utility Districts 1 19884 -1 22.7.3 Customer water usage from all sources other than the Fort Worth System, including ground water, other surface water, and water supply agreements with other entities; and 22.7.4 Additional data which may assist Fort Worth and/or Customer in developing methodology for cost of service studies, planning studies for analyzing federal grants, and Impact Fees; provided, however, that neither Party shall request data that will require either Party to incur unreasonable expenses in providing such data. 22.8 Assi mid Hent. Customer may not assign this Agreement without the prior written consent of Fort Worth. Fort Worth may not assign this Agreement without the prior written consent of Customer, except that if Fort Worth's water utility is designated as a regional water agency by a duly authorized regulatory body, or if Fort Worth elects to contract with or assign this Agreement to a regional water authority or utility to provide all or part of the services covered by this Agreement, the Customer hereby agrees and grants Fort Worth the right to assign this Agreement under the following conditions. The regional water authority or utility shall assume and receive the same obligations, responsibilities and benefits as Fort Worth, and Fort Worth or the regional authority or utility will notify the Customer of such assignment at least ninety (90) days prior to its effective date. 22.9 No Waiver. No waiver by either Party of any term or condition of this Agreement, or failure to give notice of any breach, shall be deemed or construed to be a waiver of any other term or condition or subsequent waiver of the same term or condition. 22.10 VENUE. THE PARTIES AGREE THAT THIS AGREEMENT IS PERFORMABLE IN TARRANT COUNTY,TEXAS AND THAT THE COURTS OF TARRANT COUNTY ARE A PROPER FORUM FOR THE; DETERMINATION OF ANY DISPUTE ARISING UNDER THIS AGREEMENT. 22.11 Construction. As used in this Agreement, the tenn "including" means "including without limitation," the words "shall" and "will" are mandatory and the word "may" is permissive, 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. 22.12 Severability. If any teen or provision in this Agreement is held to be invalid or unenforceable by any legislative act or court of competent jurisdiction, 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 invalid or unenforceable provision shall be deemed severed from this Agreement without invalidating the remainder of this Agreement, and a new provision shall be deemed substituted in lieu of the provision severed, which new provision shall, to the extent possible, accomplish the intent of the parties as evidenced by the provision severed, and without affecting any other term or provision in this Agreement. 22.13 Use of Return Water. Customer agrees that Fort Worth has the right to own and to use or sell any Return Water. Customer will not seek or receive any compensation, credit, or offset from Fort Worth for making the Return Water available to Fort Worth through discharges into A-reement for Water Scry ice 28 For Special Water Utility Districts 1108845-1 Fort Worth's wastewater collection and treatment system(s), and agrees that it will not provide water service under any ordinance or agreement that conflicts with Fort Worth's rights under this § 22.13. 22.14 System Regulatory Actions. Customer agrees, upon the request of Fort Worth, to give reasonable consideration to supporting Fort Worth, and shall not oppose Fort Worth, on any permit applications or governmental approvals related to the Fort Worth System. 22.15 Additional Contract 'Perms. Additional contract terms that apply to the Customer, but not Fort Worth's other wholesale customers, are contained in Exhibit F "Additional Terms." 22.16 Exhibits. All exhibits attached to this Agreement are incorporated into this Agreement by reference, for all intents and purposes of this Agreement, as follows: Exhibit A Customer Service Area and mutually agreed point(s) of delivery on the Effective Date. Exhibit B Stand-by Charge (Example Calculation) Exhibit C Example of the Annual Bill Calculation Exhibit D Calculation of PILOT and Cost of Service Revenue Requirement to Recover the Cost of Pilot Exhibit E Map of Existing Connections Outside Customer's Service Area [if any]. Exhibit F Additional Terms [THIS SPACE INTENTIONALLY BLANK] A-recmcnt for Water Service 29 For Special Water Utility Districts 1199841-1 IN TESTIMONY WHEREOF, after proper action by the respective governing bodies of the Parties, this Agreement has been executed in quadruplicate copies, each of'which is considered to be an original. ATTEST: CITY OF FORT WORTH By: City Secretary, City of Fort Worth Assistant City Manager City of Fort Worth APPROVED AS TO FORM AND LEGALITY: City Attorney, City of Fort Worth Date: APPROVAL RECOMMENDED: Director City of Fort Worth Water Department ATTEST: AQUA UTILITIES, INC. dba AQU TEXAS, INC. Corporate Secretary R8ert L. Laughman, Presi nt Date: January 13, 2011. ,Agreement for Water Seri ice 30 For Special Water Utility Districts 1193845-1 104P Brookfield Exhibit A ,M Legend r • • • Prop. waterline by dev. Water Lines ® Brookfield ._..__ CFW City Limit •iY��' L OQty j 24„ tea 114 ■ Brookfield Development point of delivery y, 1 ! from Fort Worth system with meter and m i • backflow prevention device_ Y. 'i� , 4a 10 • '� Ui Ui C ; } J HN DAY z SONGBIRD f s as 01 34, t � r ■ i — -•—• Sendera Ranch Pump Station cl OP Q 1,250 2,500 3,750 5, Feet NA°-'+s'-s".v""-A'v.-"°"_""'�r"`-+�-►•• ,•,n•a•rr}ocr. iI EXHIBIT B SECTION 7.1.3 Stand-by Charge Example Calculation 1) Stand-bv Charge Calculation Inputs: • 10 inch meter=210 EMs • 1 EM =20 Gal per Minute X 60 Minutes per Hour X 24 Hours per Day or 28,800 Gallons per Day • Does not include Cost of Raw Water 3-Year Average Treatment,Pumping and Transmission Charge($/1,000 Gals)Calculation: FY05 FY06 $0,5398 $0.6829 $0.6291 Three Year Average $9,6—M 2) Stand-by Charge.Calculation: Monthly Standby Charge = 28,800 Gallons per Day X 210 EM X $0.6173 per 1,000 Gallons or$3,733 per Month. Annual Standby Charge= 12 Months X$3,733 per Month or$44,801. STANDBY CHARGE ASSUMPTION AND DEFINITIONS: The Minimum Standby Charge is based on the maximum amoi.mt of water a connection could draw in a 24-hour period. The calculation assumes that any usage would be temporary and of an emergency basis. The calculation is also based on the number and size of each connection. The Transmission Charge is the 3-year average for that charge as calculated in the most recent independent cost-of-service study. Reserved Capacity is defined as the maximum amount of water a connection could draw in a 24-hour period. "Equivalent Meters"or"EM" is a means of relating a large-use customer with a base (residential)use customer. Fort Worth uses 5/8 x 3/4 inch meter capacity as an EM. The ratio of larger meter's capacity to the 5/8 x 3/4 inch meter capacity is the number of EMs for each meter. The ratios can be found in the AWWA Standard C700-02. 1 EM delivers 20 Gallons per Minute. I EM delivers 28;800 Gallons per Day(20 GPM * 60 Minutes/Hour* 24 Hours/Day). Maximum Reserved Emergency Usage equals EM * 28,800 EXHIBIT C SECTION 7.4 Total Annual, Monthly and Rate of Use Example Calculations The calculations shown below assume a customer drawing water from one metering station. The volumes, peaks, rates and charges in this Exhibit C are i'or demonstration purposes only and are not based on adopted rates or on actual usage for the Customer. The annual Volume Rate is charged as a rate per 1,000 gallons. The Annual Payment also includes the monthly service charge. Volume Rate of Month Gallons Rate Volume Service Use Total $/1,000 Charges Charges Charges* Gallons Oct 1,000,000 $1.43 $1,430 $25 $2,209 $3,664 Nov 1,000,000 $1.43 $1,430 $25 $2,209 $3,664 Dec 1,000,000 $1.43 $1,430 $25 $2,209 $3,664 Jan 1,000,000 $1.43 $1,430 $25 $2,209 $3,664 Feb 1,000,000 $1.43 $1,430 $25 $2,209 $3,664 Mar 2,000,000 $1.43 $2,860 $25 $2,209 $5,094 Apr 3,000,000 $1.43 $4,290 $25 $2,209 $6,524 May 3,000,000 $1.43 $4,290 $25 $2,209 $6,524 Jun 3,000,000 $1.43 $4,290 $25 $2,209 $6,524 Jul 3,000,000 $1.43 $4,290 $25 $2,209 $6,524 Aug 4,000,000 $1.43 $5,720 $25 $2,209 $7,954 23,000,000 $32,890 $275 $24,299 $57,464 Sep 3,000,000 $1.43 $4,290 $25 $7,021 $11,336 26,000,000 $37,180 $300 $31,320 $68,800 * Example calculation for Rate of Use Charges is on Page 2 of 4. 1 of 4 EXHIBIT C SECTION 7.4 Total Annual Payment Example Calculation(con't) Example Calculation for monthly Rate of Use Charges Gallons Average Daily Use for the prior year 60,000 Maximum Day Demand for the prior year 175,000 Maximum Hour Demand for the prior year 480,000 (converted to gallons per day) Maximum Day Demand above Average Daily Use (Max Day-Avg Day) 115,000 Maximum Hour Demand above Maximum Day Demand(Max Hour- 305,000 Max Day) Monthly Excess Maximum Day and Excess MaximumMax Payment Calculation: Excess MGD Charges/1\4GD* Total Max Day Above Avg Day 0.115 $135,000 $15,525 Max Hour Above Max Day 0.305 $36,000 $10,980 $26,505 Monthly Rate of Use Charge Payment(Total Divided by 12) $2,209 *The Excess Max Charges/Mn D from the current Fis a1e the Excess ax DYay Charge and te Excess Max ear annual costhof-service rate Charge,each in $/MGD,to study As shown,the monthly Rate of Use Charges are calculated using the prior year's Average Daily Use,Maximum Day Demand and Maximum Hour Demand,times the current Fiscal Year Excess Max Charges/MGD. The final Annual Payment required by Article 7 is calculated using the current Fiscal Year Average Daily Use, and the Maximum Day Demand and Maximum Hour Demand for the current Fiscal Year or for the average of the most recent three(3)Fiscal Years,whichever is greater(as provided in§7.1 and shown in the following Examples l and 2),times the current Fiscal Year Excess Max Charges/MGD. 2 of 4 EXHIBIT C SECTION 7.4 Total Annual Payment Example Calculation (con't) Example 1—Current year exceeds the average of the most recent three Fiscal Years Gallons Average Daily Use for the year 71,233 Maximum Day Demand for the current year 215,000 Maximum Hour Demand for the current year 545,000 (converted to gallons per day) Maximum Day Demand above Average Daily Use 143,767 Maximum Hour Demand above Maximum Day Demand 330,000 Fiscal Year Average of Most Recent Three Years Current FY FY Average FY 2008 2007 Max Day Above Avg Day (MG) 129,178 143,767 115,000 128,766 Max Hour Above Max Day (MG) 318,333 330,000 305,000 320,000 Annual Payment Calculation Volume Rate Gallons $/1,000 Gallons Total 26,000,000 x $1.43 = $37,180 Service Charge Months $25 x 12 = $300 Max Day Above Excess Max Avg Day (MGD) Charges/MGD 0.144 x $135,000 = $19,440 Max Hour Above Max Day Excess Max (MGD) Charges/MGD 0.330 x $36,000 = $11,880 Total Annual Payment Due $68,800 Previous Billings for October through August Usage $57,464 October Billing for September Usage $11,336 3 of 4 EXHIBIT C SECTION 7.4 Total Annual Payment Example Calculation (con't) Example 2—The average of the most recent three Fiscal Years exceeds Current year. Gallons Average Daily Use for the year 71,233 Maximum Day Demand for the current year 190,000 Maximum Hour Demand for the current year (converted to gallons per day) 500,000 Maximum Day Demand above Average Daily Use 118,767 Maximum Hour Demand above Maximum Day Demand 310,000 Fiscal Year Average of Most Recent Three Years CURRENT FY FY Average FY 2008 2007 Max Day Above Avg Day (MG) 120,844 118,767 115,000 128,766 Max Hour Above Max Day (MG) 311,667 310,000 305,000 320,000 Annual Payment Calculation Volume Rate Gallons $/1,000 Gallons Total 26,000,000 x $1.43 = $37,180 Service Charge Months $25 x 12 = $300 Max Day Above Avg Day Excess Max (MGD) ChargesAGD 0.121 x $135,000 = $16,335 Max Hour Above Max Excess Max Day (MGD) Charges/MGD 0.312 x $36,000 = $11,232 Total Annual Payment Due $65,047 Previous Billings for October through August Usage $57,464 October Billing for September Usage $7,583 4 of 4 EXHIBIT D Calculation of PILOT and Cost of Service Revenue Requirement to Recover the Utility's Cost of PILOT DESCRIPTION d is an A payment in lieu of taxes ("PILOT") assessedOperating of thenWater Systeml assessment to offset the ad valorem taxes lost, due to the non-profit The Water Operating Fund pays the amount of the assessment into the General Fund. PILOT assessed against the Water Operating Fund is calculated by applying the most recently adopted property tax rate per $100 assessed value to the net book value of the applicable assets. These assets are limited to the assets classified notant and includeTransmission Mains(in the eCConnectific lions, UC accounts listed on the next page), and dt Collection Structures and Meters. The PILOT is a component of the Water Operati Revenue Requirement that is necessary to on er P LOTund tisf allocated between Service. The tRetaiof l Service Wholesale customer classes according to the volume usage in the most recently completed fiscal year, prorated between the two customer class st the lesale The Wholesale Cost of Service component of PILOT ercentathen e ofallocated t]e wholesale customer customers according to each wholesale customers p g volume usage in the most in the most recently completed fiscal year. EXAMPLE ,� the related revenue The following example further explains the calculation of the City's PILOT,T, this example will requirement, and its recovery through rates. The methodology�cpplied figures, volumes and remain in effect for the life of the Agreement; however,ill be updated from the sources identified other numerical values used in the following example below for each fiscal year that the contract is in effect. !I NET BOOK VALUE CALCULATION FOR PILOT ASSESSMENT PILOT assessed against the Water Operating Fund is calculated by applying the most recently adopted property tax rate per$100 assessed value to the net book value of the applicable assets, calculated as: Historical Cost of Water System Assets at most recent audited year end; LESS Historical Cost of Non-Plant and Non-Property Water System assets defined by NARUC (National Association of Regulatory Utility Commissioners)codes: 316 Raw Water Conduit and Valves 343 Transmission Mains 345 Service Connections 346 Meters 347 Meter Installation 348 Hydrant 372 Structures &Improvements/Collection (If any of these account codes are amended,the equivalent code will be substituted.) LESS Accumulated Depreciation on Plant and Property at most.recent audited year end; PLUS Construction Work in Progress on Plant and Property at most recent audited year end; Example calculation: NET BOOK VALUE CALCULATIO.'S LESS Historical Cost PLUS Total of Non-Plant LESS Historical and Non- Life-to-Date Construction EQUA K T Cost of Water Property Accumulated Work In BOOVALUE System Assets Depreciation progress $982,385,273 ($655,261,618) ($105,793,316) $26,990,180 $248,320,519 (Dollar figures from most recent Cost of Service Study.) NET BOOK VALUE ALLOCATION BETWEEN RETAIL AND WHOLESALE The Cost of Service Revenue Requirement necessary to recover PILOT is allocated between Retail and Wholesale customer classes according to the volume usage in the most recently completed fiscal year, prorated between the two customer classes. Example Retail/Wholesale allocation calculation: _ Volume(MG) Total Annual Volume(MG) 66,917 Wholesale Volume(MG) 21,639 Wholesale Allocation 32.34% 67.66%0 Retail Allocation (Dollar figures and percentages from most recent Cost of Service Study.) Total Net Book Value Base $248,320,519 Wholesale Net Book Value Base $80,299,602 CALCULATION OF WHOLESALE REVENUE REQUIREMENT (PILOT COST OF SERVICE COMPONENT) FY 2010 Tax Rate per$100 Value x0.8550 Total PILOT Cost of Service $2,123,140 Wholesale Allocation 32.34% Wholesale PILOT Cost of Service $686,562 EXHIBIT E Exhibit Intentionally Omitted EXHIBIT F ADDITIONAL TERMS The Parties acknowledge and agree that Impact Fees pursuant to Article 16 and Cost of New or Additional Connections pursuant to Section 3.3 shall be paid to Fort Worth as required by the Brookfield Water and Wastewater Utility Service Agreement as entered into by the City of Fort Worth, the Customer, Brookfield Acquisitions, L.P., and South Denton County Water Control and Improvement District No. 1. To the extent the terms and conditions of Article 16 conflict with the terms and conditions of the Utility Service Agreement, the terms and conditions of the Utility Service Agreement shall control. /agreement for Water Service 31 For Special Water Utility Districts 1 198345-1 Exhibit E Wholesale Wastewater Service Agreement Exhibit E to Brookfield Watcr and Wastcwatcr Utility Scrvice ngrecment Page I WHOLESALE, WASTEWATER SERVICE AGREEMENT FOR BROOKFIELD DEVELOPMENT This Wholesale Wastewater Service Agreement ("Agreement") is entered into by and between the City of Fort Worth, a Texas home rule municipality (the "City") and Aqua Utilities, Inc., a"Texas corporation doing business as Aqua "Texas, Inc. ("Aqua Texas"). RECITALS A. Aqua Texas wishes to provide retail wastewater utility service to the land shown on Exhibit A consisting of approximately 231.579 acres in Denton County, 'Texas to be developed as a mixed-use, master-planned development known as "Brookfield" (the "Development") located entirely within the City's extraterritorial jurisdiction ("ETF'), and more particularly described in Exhibit B to this Agreement. B. Aqua Texas holds Certificate of Convenience and Necessity ("CCN") No. 20453 authorizing Aqua Texas to provide retail wastewater service in various areas within Denton and Wise Counties, including the land within the Development. C. The City, South Denton County Water Control and Improvement District No. 1 (the "District"), and Aqua Texas are parties to the "Brookfield Water and Wastewater Utility Service Agreement," dated 2011, City Secretary Contract No. , ("Utility Agreement"), which sets forth the rights and obligations of the parties to that agreement with respect to the provision of retail and wholesale water and wastewater service to the Development, and provides, among other things, for the City and Aqua Texas to enter into a contract for the provision of wholesale wastewater service to the Development, commencing with the 191 ` active residential connection within the Development. D. "The City and the "Trinity River Authority of Texas ("TRA") are parties to the "Trinity River Authority of "Texas - Denton Creek Regional Wastewater "Treatment System Contract," dated October 28, 1987, City Secretary Contract No. 16054, attached as Exhibit C, as amended from time to time ("TRA Contract"), pursuant to which the City may obtain certain services from TRA for the transportation, treatment and disposal of sanitary sewage, industrial waste and other wastes generated in the drainage area of Denton Creek through the Denton Creek Regional Wastewater System (the "TRA System"). 1 The Development is located in the drainage area of Denton Creek. F. Aqua Texas has considered its various alternatives for treatment of' the Development's wastewater and has elected to seek to obtain such services 11•0111 the City. Brookfield Wholesale Wastewater Scrvice Agreement Pa-c I 1 1991 12-1 G. Aqua Texas has independently obtained a wastewater utility engineering study describing facilities and equipment needed for retail wastewater service to the Development, including the collection lines, lift stations and other appurtenant wastewater utility service facilities. I1. Aqua "Texas and the City have reached a mutually satisfactory agreement by which Aqua Texas will purchase from the City certain collection and treatment services for wastewater generated within the Development to be collected and transported from sewer lines within the Development, to sewer lines owned by the City, to the City's point of entry into the "TRA System as authorized by the "TRA Contract and subject to the Utility Agreement, commencing with the 191" active residential connection and thereafter including all customers within the Development, including the first 190 connections. 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 DEFINITIONS "Advisory Committee" means the Advisory Committee of the "IRA. "Agreement" means this Wholesale Wastewater Service Agreement between the City and Aqua Texas. "Aqua Texas" means Aqua Utilities, Inc., doing business as Aqua Texas, Inc., a Texas corporation (and/or its corporate successors and assigns). "Biochemical Oxygen Demand" ("BOD") means the quantity of oxygen utilized in the biochemical oxidation of organic matter under standard laboratory procedure in five days at 20 degrees Centigrade, expressed in milligrams per liter. "City" means the City of fort Worth, Texas, a home rule municipality. "City Council" means the City Council of the City. "Cure Period" means the period of time to cure a material breach, as defined in Section 9.04. "Development" means that certain 231.579-acre tract in Denton County, Texas to be developed as a mixed-use, master-planned development known as "Brookfield" as shown on Exhibit A and more particularly described in Exhibit B, which Development is located entirely within the ET.I of the City. "Development's Capacity" means the wastewater capacity that the City has allocated to serve the Dcvclopmcnt pursuant to Section 2.01. Brookfield Wholesale Wastewater Service Agreement page 1199512-I "Development's System" means the wastewater collection facilities (whether owned by the District or third parties) located on the Development, or those facilities located outside the Development but constructed and operated to serve the Development, and on the Development's side of the Point of Entry into the Fort Worth System shown on Exhibit D. "Director" means the City Water Department Director or designee. "Discharge" means any solid or liquid waste, regardless of its source, nature or composition, that enters a wastewater collection or treatment system. "Effective Date" means the effective date as defined in Section 9.03. "TPA" means the U.S. Environmental Protection Agency. "FTY' means the extraterritorial jurisdiction of a city as defined by the Texas Local Government Code, as amended, with the City's E"rJ 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 those sewer lines and associated facilities owned by the City. "General Benefit Capital Facilities" means wastewater facilities that provide utility services and benefits common to all City customers, including but not limited to wastewater treatment facilities, Metering and Sampling Facilities, control systems and appurtenances, and all major collectors and interceptors that are eighteen inches (18") and greater in diameter. "Infiltration"means water that has migrated from the ground into a wastewater system. "Inflow" means water other than wastewater that enters a wastewater system (including sewer service connections) from sources such as, but not limited to, roof leaders, cellar drains, yard drains, area drains, drains from springs and swampy areas, manhole covers, cross connections between storm sewers and sanitary catch basins, cooling towers, storm waters, surface runoff, street wash waters or drainage. Inflow does not include, and is distinguished from, Infiltration. "Meterin<fy and Sampling Facilities" means the meter, meter vault, and all metering and telemetry equipment required to measure and/or sample wastewater flows from the Development at the Point of'Fritry. "MGD" means million gallons per day. "Notice" means notice as defined in Section 11.02 of this Agreement. Brooklield wholesale wastewater Scrvice Agreement Paye 3 1199512-1 "Parties" means the City, Aqua "Texas, and their successors and assigns, as permitted by this Agreement. "Party" means, individually, the City, Aqua 'Texas, or each of its successors and its assigns, as permitted by this Agreement. "Point of Entry" means the location where Discharge from the Development's System enters the Fort Worth System, as reflected on the attached Exhibit D. "Prohibited Discharge" means a Discharge from outside the Development's System or otherwise not in compliance with this Agreement, as defined in Section 2.02. "Significant Industrial User" ("SIU") means any User connected to the Development's System that meets at least one of the following criteria: a. Average industrial wastewater discharge rate greater than 50,000 gallons per day. b. Biochemical Oxygen Demand and/or suspended solids concentrations in industrial wastewater greater than 250 mg/L. C. Meets any of the criteria used by the Environmental Protection Agency ("EPA") to defile SIU in 40 C.I .R. 5 403.3(1) as amended from time to time (for purposes of the EPA definition of SIU relating to the "Control Authority," the Control Authority currently refers to the TCEQ). "System Cost" means operating expenses and capital related costs incurred by the City pursuant to the provision of wastewater collection and treatment service to the wholesale class of sewer customers. Such costs are to be collected by the City as a component of the annual cost of providing wholesale wastewater service. "TCEQ" means the Texas Commission on Environmental Quality or its successor state agency. "'IRA" means the Trinity River Authority of Texas. "TRA Contract" means that agreement defined in Recital D above and attached as Exhibit C, as it may be amended from time to time. "TRA System" means the Denton Creek Regional Wastewater System owned and operated by the "TRA, including the Denton Creek Regional Wastewater System treatment plant as well as those sewer lines and associated facilities owned by TRA which transport wastewater to that plant. ""TSS" (also referred to as Total Non-Filterable Residue) means total suspended solids, measured in mg/L, that either float on the surface of, or are in suspension in, water, wastewater or other liquids, and which are largely removable by a laboratory filtration device. "User" means any person or entity that owns or operates any facility or other point from which a Dischai-c enters the Development's System, either directly or indirectly. Brookfield Wholesale Wastewater Service A-reen-ient Page 1199512-1 "UtilityAAgrecment" means the agreement defined in Recital C above. ARTICLE II GENERAL 2.01 Development's Capacity. The City has allocated to the Development a portion of its available TRA Contract treatment capacity sufficient to accept the wastewater from the Development's System pursuant to this Agreement. Aqua Texas shall have the right, in accordance with the terms and conditions of this Agreement, to deliver wastewater collected by the Development's System, in volumes not to exceed the Development's Capacity, to the Point of Entry for further transport by the City and TRA and treatment at the TRA System plant pursuant to the City's rights under the "ERA Contract. The Development's Capacity shall not exceed a peak flow of 700 gallons per minute and an average daily flow of 330 gallons per minute. Thus, the combined maximum rate of discharge from the Development's System into the Fort Worth System may not exceed a rate which, if continued for a period of twenty-flour hours would equal 3.16 times the 330 gallon per minute average daily flow. The City's obligation to provide wastewater treatment services to Aqua Texas in accordance with the terms of this Agreement will commence with the 191st active residential connection constructed within the Development, at which time the City will become the wholesale wastewater treatment provider for all customers within the Development, including without limitation the first 190 connections. 2.02 Prohibited Discharges. Any waste generated outside the Development or any Discharge not in compliance with this Agreement is a Prohibited Discharge that is not authorized to enter the Development's System pursuant to this Agreement. The City shall be under no obligation to accept, transport or treat any Prohibited Discharge. 2.03 TRA Approvals and TRA Contract. The TRA Contract requires approval of"this Agreement by both the TRA and by a majority vote of the Advisory Committee and is not valid until such required approvals are obtained. The Agreement is subject to the TRA Contract, as amended from time to time, and all standards contained therein. This Agreement is a "subcontract"as that term is used in, and for purposes of, Section 9(c) of the TRA Contract. 2.04 Connection to the Fort Worth System. The City hereby grants to Aqua Texas, upon compliance with the terms and conditions of this Agreement, pennission to connect the Development's System to the Port Worth System at the Point of Entry as agreed to and designated on Exhibit I). Other Point(s) oflntry may be mutually agreed upon at a later date. 2.05 Construction and Maintenance of Development's System. Aqua Texas agrees that the Development's System, including all sewer connections, shall be constructed in accordance with the standards set forth in the Utility Agreement. Aqua Texas agrees to maintain the Development's System in good condition and to make repairs in a timely manner, and in the manner it determines in its sole discretion, so as to comply with this Agreement, the Utility Agreement and applicable federal, state and local laws. The City shall not have any responsibility or liability for the maintenance and operation of the Development's System, unless and until the City takes title to the Developments System. Aqua Texas shall not have any Brookfield Wholesale Wastewater Scrvice Agreement Pagc 5 1199512-1 responsibility or liability for the maintenance and operation of the Fort Worth System, except as otherwise expressly provided herein. 2.06 Extension of Facilities. The City's wastewater collection line is approximately 24,800 feet from the Development. In order for Aqua Texas to receive wastewater service from the City pursuant to this Agreement, the City's wastewater collection line will have to be extended to the Development. The City has no obligation to extend such line. 2.07 Prevention of Sewer System Overflows. Aqua Texas agrees to develop, and to implement upon commencement of operation of the Development's System, an ongoing capacity management, operation and maintenance plan for the prevention of sewer system overflows. The plan shall include rehabilitation, operation and maintenance for the Development's System and shall comply with any written directives from TRA applicable to the Fort Worth System. 2.08 Compliance with I,aws. Aqua Texas shall operate the Development's System in compliance with all applicable federal, state and local laws, including but not limited to the regulations, permits and orders adopted or issued by EPA, TCEQ or other regulatory authorities with jurisdiction over the Development's System. Aqua Texas shall send to the City, pursuant to the procedures required for Notice, copies of any reports or other communications to or from the TCEQ, the EPA, TRA, Denton County or other political subdivisions of the State of Texas, that contain data from or analyses of, or otherwise expressly discuss, the Development's System. In addition, upon request from TRA or the City, Aqua Texas shall provide copies of any documents or data, to the extent that they are not legally privileged, that are necessary for the operation of the TRA System or the Fort Worth System. ARTICLE III WASTEWATER QUALITY, STANDARDS and ENFORCEMENT 3.01 Influent Quality and Pretreatment Standards. Aqua Texas agrees that all Discharge into the Development's System shall comply with influent quality and pretreatment standards contained in both Section 4 of the TRA Contract, as amended from time to time, and Article VI of Chapter 12.5 of the Fort Worth City Code, as amended from time to time, excluding standards that do not apply to the TRA System. Aqua "Texas further agrees to impose and reasonably enforce, through its tariff or otherwise, these influent quality and pretreatment standards within the Development's System. In addition to compliance at the point of discharge into the Development's System, any Discharge shall comply with these influent quality and pretreatment standards at the Point of Entry into the Fort Worth System. 3.02 Industrial Wastewater. Aqua 'texas shall obtain the written consent of the City prior to any Discharge into the Development's System generated by a SIU. Consent will not be granted unless (i) the proposed Discharge will meet all influent quality and pretreatment standards of Section 3.01 and (ii) the SIt1 submits a permit application ninety (90) days prior to commencing discharge in accordance with Article VI of Chapter 12.5 of the Fort Worth City Code, as amended from time to time, and such permit is granted. As a condition for granting the permit, the City may require the pretreatment of the Discharge as specified in relevant sections of the Fort Worth City Code. Brookficld Wholesale Wastewater Service Agreement Page G 1 199512-i b 3.03 Infiltration and Inflow. Connections that allow surface drainage (including storm water run-off from rainwater spouts, rainwater collection areas, streets and gutters), abnormal seepage, and Infiltration or Inflow to enter the Development's System are prohibited. Aqua Texas will supervise and maintain the Development's System using best management practices to prevent such Prohibited Discharges and, if any are discovered within the Development's System, shall, to the extent permitted by law, immediately take the necessary steps to disconnect them.. 3.04 Compliance with Permit Conditions. Aqua Texas acknowledges that both the City and TRA are holders of Texas Pollutant Discharge Elimination System permits issued by the State of Texas and subject to oversight by EPA. Aqua Texas agrees that it will comply with all permit conditions that relate in any way to the Development's System and to any L)ischarge into the Development's System that ultimately enters the Port Worth System. Aqua Texas agrees that, in the event a fine is assessed against the City or TRA for any violation of any permit condition, and the violation is directly attributable, in whole or in part, to the Development's System or to a Prohibited Discharge, then such fine is included in the matters indemnified by Aqua "Texas pursuant to Article VII. 3.05 Fort Worth City Code. Aqua Texas agrees to abide by all other provisions contained in Article VI of Chapter 12.5 of the Port Worth City Code that apply to customers or other users in the City's ETJ, as amended from time to time, including, but not limited to, those provisions that relate to influent quality or pretreatment standards. 3.06 City's Right to Revise Wastewater Quality Standards. The City reserves the right to revise influent quality and pretreatment standards contained in the Port Worth City Code, and shall provide Notice to Aqua Texas of the adoption of such revision within a reasonable time after revision thereof. Aqua Texas shall be responsible for integrating such changes into its agreements with Users and for notifying all affected Users of the change within sixty (60) days following such Notice. 3.07 Enforcement. Aqua Texas will reasonably inspect all connections at the time made and will routinely monitor the Development's System as a whole as reasonably necessary to detect and prevent any Prohibited Discharge. If any Prohibited Discharge is discovered, Aqua "Texas shall immediately take actions necessary to eliminate the Prohibited Discharge or, following notice and to the extent permitted by law, to disconnect the User from the Development's System. In addition to Aqua Texas' obligation to enforce influent quality and pretreatment standards under this Article III, the City has the right, within the Development's System, to enforce the same using methods including, but not limited to, those enforcement procedures contained in Chapter 12.5, Article I, Division 3 of the Fort Worth City Code, as amended from time to time, and the Enforcement Response Plan agreed to by the City and the TRA, as amended from time to time; however, such enforcement by the City does not relieve Aqua 'Texas of its enforcement obligations under this Agreement. ARTICLE IV RATES and CHARGES Biooktield Wholesale Wastewater Scrvice Agreement Page 7 1 199S12-1 4.01 Calculation of Rates Pursuant to this Agreement. The Parties agree that the rates to be charged pursuant to this Agreement will be calculated using the methodology set forth in Exhibit E. 'Phis methodology also serves as the basis for the wholesale wastewater rates that the City charges to each municipality that is a wholesale wastewater customer of the City, pursuant to each of their separate contracts. The City will send Aqua "Texas a copy of any finally adopted wastewater rate study performed pursuant to this methodology. The majority of those separate contracts with the City's wholesale customers who are municipalities will expire in 2017 and the City expects to enter into negotiation for new wholesale contracts with those wholesale customers who are municipalities. The City shall provide Aqua Texas at least ten (10) days prior Notice of the commencement of the negotiations between the City and the Wastewater Advisory Committee. If this Agreement is renewed pursuant to Section 9.02(A), and if the renegotiated contracts with the City's wholesale customers who are municipalities include a rate methodology that differs from Exhibit E, then Aqua Texas and the City expressly understand and agree that for the renewal term of this Agreement the rate methodology described in Exhibit E will be automatically superseded and replaced with a new Exhibit E that adopts the same rate methodology used to calculate the rates for those wholesale customers of the City who are municipalities, subject to the provisions of Articles IV and IX herein. 4.02 Initial Rate. The initial rates for this Agreement shall be those adopted by the City Council tor the City's wholesale customers and in effect on the first day. Discharge from the Development enters the Fort Worth System. By way of example, the City's rates for wholesale customers effective on October 1, 2008, were as follows: Volune Charge $0.8819 per 1000 gallons BOD Strength Charges $0.3349 per pound of BOD TSS Strength Charges $0.2036 per pound of TSS Monthly Billing Charges $75.00 4.03 Adjustment of Rates. Aqua Texas agrees that the City shall have the right to unilaterally adjust the rates charged for the wastewater services provided pursuant to this Agreement, from time to time, so long as the adjustment is based on the agreed methodology set forth in Exhibit E and in effect pursuant to Section 4.01, and otherwise in compliance with this Agreement. Aqua Texas' 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 Aqua "Texas in exchange for the City's entering into this Agreement to provide wholesale wastewater service to the Development, which is in the City's ETJ, and without which consideration the City would not have provided wholesale sewer services to Aqua Texas, either by entering into this Agreement or otherwise. Furthermore, in exchange for the City's right to unilaterally adjust the rates charged hereunder, in addition to other rights under this Agreement, should Aqua Texas object to any unilateral rate adjustment, Aqua Texas shall have the right to terminate this Agreement with one year's Notice and the following rate relief. Upon any rate adjustment pursuant to this Article IV and Exhibit E,, Aqua Texas has the following options: A. Agree to pay the adjusted rate: or Brookticld Wholesale Wastewater Servicc Agreement Pagc 8 1199512-1 13. Give Notice (i) that it wishes to terminate this Agreement one year after the effective date of' the proposed rate adjustment and (ii) that it rejects the rate change, in which case the City will continue to charge Aqua 'Texas the contract rates that were in effect immediately prior to the proposed rate adjustment. If Aqua "Texas elects to terminate this Agreement under this Section 4.03, then the Agreement will expire at the earlier of the one-year Notice period or the Section 9.01 expiration date. If Aqua Texas continues to deliver wastewater to the City at the Point of Delivery and has not disconnected the Development's System from the Fort Worth System on the date this Agreement is to expire pursuant to this Section 4.03, then the Agreement shall not expire pursuant to this Section 4.03 and Aqua Texas shall immediately pay the City the difference between the amount that would have been charged pursuant to this Agreement under the rate Aqua Texas rejected, and the amount actually charged to Aqua Texas during the preceding year, with interest, and subject to any other rate adjustment, past or future, pursuant to this Article IV and Exhibit E. Aqua 'Texas agrees that the remedy provided by this Section 4.03 provides its sole and exclusive remedy, in law and equity, for any rate adjustments pursuant to this Agreement, and that it will not pursue a wholesale rate appeal of such rates at any regulatory agency. 4.04 Payment and Finance Charge. Bills for services provided pursuant to this Agreement shall be rendered to Aqua Texas monthly by the City. All such bills shall be due and payable by Aqua Texas not more than thirty (30) days from the billing date. The bills will show current charges, as well as past-due charges, if any. Current charges shall be the amount due for wastewater collection, treatment and disposal service provided since the prior billing period. 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. Any payment required herein not made within thirty (30) days of the billing date shall be subject to a finance charge of ten percent (10%) per annum to be calculated from the date which the payment was required to be made. 4.0.5 Billing Disputes. If Aqua Texas disputes a bill and is unable to resolve the difference informally, Aqua Texas shall give Notice to the Director. The Director and Aqua Texas 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 which the payment was required to be made. 4.06 Minimum Revenue Collection. Aqua Texas agrees, throughout the terns of' this Agreement, to fix and collect such rates and charges for wastewater service to be supplied to the Development as will produce revenues in an amount equal to at least all of operation and maintenance expenses of the Development's System, including specifically the payments under this Agreement. ARTICLE V METERING AND SAMPLING FACILITIES Brookfield Wholesale Wastewater Servicc Agreement Page 9 1199512-1 5.01 Construction and Title. Aqua Texas or its agents or assigns shall construct or cause to be constructed the Metering and Sampling Facilities. All construction shall be in accordance with plans and specifications meeting City standards and shall be approved in advance by the City. All construction costs, including, but not limited to, site acquisition and preparation, design and engineering, construction and equipment for such facilities, together with the costs of necessary easements and rights-of-way, and including any and all necessary modifications to accommodate a complete initial installation satisfactory to the City, shall be provided free of charge to the City and be paid for pursuant to the Utility Agreement. Upon acceptance of the Metering and Sampling Facilities, the City shall own and have title to the Metering and Sampling Facilities along with the exclusive right to use, operate, and maintain such facilities; however, such metering and sampling facilities shall serve the Development only and no Discharge from outside the Development will be connected to the Fort Worth System in a manner that would allow it to pass through such facilities. 5.02 Operation and Maintenance. The City shall become solely responsible for the operation and maintenance responsibilities associated with the Metering and Sampling Facilities. Aqua Texas, to the extent that access is under its control, will continuously provide a route of ingress and egress to said Metering and Sampling Facilities for the City. The City shall have the discretion to construct improvements, expansions, and replacements to said facilities as a System Cost and at the timing of the City's needs. Aqua Texas will also grant and provide to the City such permits or easements as are necessary for the continuous operation and maintenance of all Metering and Sampling Facilities. All costs incurred by the City for operation, maintenance, or replacement of the Metering and Sampling Facilities shall be considered a System Cost. 5.03 Expenses. Expenses incurred by the City for the operation and maintenance of the Metering and Sampling Facilities shall be a System Cost and shall include, but not necessarily be limited to, the following: A. Cost of electricity at the facility; B. Cost of the initial installation of the telemetry service at the facility and to the control center and cost of monthly lease charge for the telephone line; C. Cost of calibration; D. Cost of parts, materials and supplies required for repairs, calibrations and upgrading of'the facilities; E. Labor cost plus fringe benefits and indirect costs for repairs, calibrations and upgrading of the facilities; and F. Maintenance of ingress and egress and meter facility site. 5.04 Replacement Facilities. Replacement of the Metering and Sampling Facilities described in this Article V or the equipment therein, occasioned as a result of"obsolescence due to age, excessive maintenance, growth or other reasons as determined by the Director, shall be a System Cost. Any replacement facility or equipment therein shall comply with the City's standards and specifications. ARTICLE VI METERING AND SAMPLING Brookfield Wholesale Wastewater Service Agreement 1 1995 12-I Page 10 6.01 Requirement of Metering; and Sampling. Any Discharge into the Fort Worth System from the Development's System shall be metered and sampled as set forth in this Article VI. 6.02 Access to Facilities. Aqua "Texas shall have access to the Metering and Sampling Facilities at all reasonable times; provided, however, that any reading, calibration or adjustment to such metering equipment shall be done by employees or agents of the City, or other mutually approved third party calibration agent, in the presence of representatives of Aqua Texas and the City, if so requested by Aqua Texas. Notice of any proposed tests shall be provided to Aqua Texas at least seventy-two (72) hours prior to such tests being conducted. 6.03 Access to Records. All readings of meters will be maintained by the City in its usual and customary manner. Aqua Texas shall have access to such records during reasonable business hours and shall be furnished with monthly totalizer readings for each Point of Entry metering and sampling facility. 6.04 Service and Calibration. The City shall calibrate and routinely service the meters no less than once during each six (6) month period. Copies of"the results of such calibration and all related information shall be provided to Aqua Texas. The City shall notify Aqua Texas at least seventy-two (72) hours in advance of the date and time for any calibration and Aqua Texas may observe the calibration. 6.05 Corrections. Upon any calibration, if it is determined that the accuracy envelope of such 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 such 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. 6.06 Out of Service Meter. If any meter used to determine volume from the Development's System is out of service or out of repair so that the amount of wastewater metered cannot be ascertained or computed from the reading thereof, the wastewater delivered through the period such meter is out of service or out of repair shall be estimated and agreed upon by the Parties hereto upon the basis of the best data available. The basis for estimating such flow includes, but is not limited to, extrapolation of past patterns of flow for said metering station under similar conditions. 6.07 Monitorin 4 of Quantity and Qualitx. All Discharge from the Development's System shall be monitored for volume. In addition, the City shall periodically determine the quality of the Discharge from the Development's System at the Metering and Sampling Facilities or other agreed upon sampling points for the purposes of billing for the strength of the wastewater. The sampling and testing shall be performed up to two times per year until build-out of the Development and thereafter one time per year. To determine the quality of the wastewater, the City shall collect twenty-Four (24) hour flow-weighted composite samples for a period of- not less than five (5) consecutive twenty-lour (24) hour periods. The City will provide Aqua Texas with a Notice at least Brookfield Wholesale Wastewater Service Agreement Pagc I I 1199512-1 seven (7) days in advance of its intent to sample, or sufficiently in advance of the sampling to allow Aqua Texas to arrange the services of a qualified laboratory. If, at the request of Aqua"Texas or at the request of the Director, more extensive monitoring is desired, such additional monitoring shall be paid for by the Party making the request and shall be done in compliance with this Article VI. If Aqua "Texas requests such additional monitoring, the City shall invoice Aqua "Texas and payment shall be made within thirty (30) days after receipt of invoice. The Notice shall include the planned dates, times, and location(s) of sampling. The City shall analyze the samples collected in accordance with standard methods. Aqua Texas may be present during the initial setup of sampling equipment and at the time of pickup for each twenty-four (24) hour composite sample. The City agrees, if requested, to split the wastewater samples with Aqua Texas. 6.08 Compliance Monitoring. If, in the opinion of the Director, compliance monitoring is required, the Director may order that additional monitoring be performed with or without prior Notice to Aqua Texas. Such compliance monitoring is to be in addition to the routine monitoring and periodic sampling set forth in Section 6.07. All information obtained as a result of this compliance monitoring shall be provided to Aqua Texas upon request. The City will provide Notice of such compliance monitoring to Aqua Texas within a reasonable time thereafter. ARTICLE VII OWNERSHIP, LIABILITY and INDEMNIFICATION 7.01 Liability and Ownership. Liability for damages arising out of the transportation, delivery, receipt, treatment, or disposal of any Discharge into the Development's System shall remain in Aqua Texas, together with ownership of the Discharge, until such Discharge passes through the Point of Entry to the Fort Worth System, at which point ownership of the Discharge and any liability arising thereafter shall pass to the City, save and except that liability arising out of and ownership of any Prohibited Discharge shall not pass to the City, and shall remain with Aqua Texas. No provision of this Agreement shall be construed to create any type of joint or equity ownership of' any property, any partnership or any joint venture. Payments by Aqua Texas (whether past, present, or future) will not be construed as granting Aqua Texas partial ownership of, pre-paid capacity in, or equity in the Fort Worth System or the TRA System. 7.02 Indemnity. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, AQUA TEXAS AGREES TO INDEMNIFY AND DEFEND CITY, TRA, AND EACH OF 'THEIR RESPECTIVE, OFFICERS, ELECTED OFFICIALS, EMPLOYEES, AGENTS, ATTORNEYS, CONSULTAN'T'S, 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, REASONABLE ATTORNEYS' FEES, COSTS OF INVESTIGATION AND EXPENSES, INCLUDING THOSE INCURRED BY CITY IN ENFORCING THIS INDEMNITY), DIRECTLY OR INDIRECTLY ARISING OUT OF, CAUSED BY OR RESULTING FROM (IN WHOLE OR IN PART) ANY BREACH OF"THIS AGREEMENT, ANY PROHIBITED DISCHARGE,OR ANY CONNECTION OF THE DEVELOPMENT'S SYSTEM TO THE FORT WORTH SYSTEM, (COLLECTIVELY, "LIABILITIES"), EVEN IF SUCH LIABILITIES ARISE FROM OR ARE ATTRIBUTED TO STRICT LIABILITY. Brookficld Wholesale Wastewater Service Agreement f ale I? 1199512-I ARTICLE VIII REPORTS AND RECORDS 8.01 Required Records. As required by the City's agreement with TRA, Aqua Texas shall provide the following data upon 30 days Notice from the City: A. Actual number of customer accounts discharging into the Development's System; B. Classification of domestic and non-domestic accounts within its service area by number and percentage of accounts discharging directly or indirectly into the Development's System; C. The number of SIU connections subject to Section 3.02 of this Agreement to be served by the Development's System, with name and location of each; and D. Additional data which may assist the City in developing methodology for cost of service studies, planning studies for analyzing federal grants, and system access fees; provided, however, that the City shall not request data that will require Aqua Texas to incur unreasonable expenses in providing such data. 8.02 Inspection and Audit. Complete records and accowzts required to be maintained by each Party hereto shall be kept 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 IX TERM and RELATED PROVISIONS 9.01 Tern of Agreement. This Agreement shall expire upon the sooner of: (i) the date upon which Aqua "Texas ceases to be the retail wastewater provider for the Development; (ii). termination in accordance with this Article IX; or(iii) April 30, 2018. 9.02 Extension. Where expiration of this Agreement occurs pursuant to Section 9.01(iii), the City will offer to continue to sell wholesale water service to Aqua Texas under one of two options, to be chosen by the City in its sole discretion: A. A renewal of this Agreement, in its entirety, amending only Section 9.01(iii) to state "December 31, 2029" and Section 4.02 to state initial rates that are those in effect on the first day of the renewal term for the City's wholesale customers who are municipalities. B. A wholesale wastewater agreement with terns that are the same as the terns of the renegotiated contracts with the City's wholesale customers whose contracts now expire in 2017, and subject to all the terns and conditions of those contracts, except that the expiration date of the wholesale agreement with Aqua Texas shall not extend beyond the earlier of the date on which Aqua 'Texas Brooklicld Wholesale Wastewater Service Agreement Nage 13 1 1995 12-1 ceases to be the retail wastewater provider for the Development or December 31, 2029. The City will advise Aqua "Texas of the City's selected option by providing Notice one hundred eighty (180) days before the Section 9.01(iii) expiration date. Aqua Texas can then either (i) agree to accept the option offered by the City in its Notice, in which case Aqua Texas and the City will execute the documents necessary to formalize the terms of such agreement within 60 days of Aqua Texas' receipt of"Notice; or(ii) elect not to continue to purchase wastewater from the City, in which case this Agreement terminates on the Section 9.01(iii) expiration date and thus the City shall have no further service obligation thereafter. If the City fails to offer Aqua Texas an option pursuant to this section, this Agreement shall be deemed to be extended to December 31, 2029. If the City's wholesale customers' 2017 expiration dates are extended, then the Section 9.01(iii) expiration date of this Agreement will be extended for the same number of years or months, but in no event beyond December 31, 2029. The City is subject to this section without regard to whether the City has commenced providing wastewater treatment service to the Development in accordance with Section 2.01 as of April 30, 2018. 9.03 Effective Date. This Agreement, together with all terms and conditions and covenants, shall be effective upon execution by both Parties. Notwithstanding the foregoing, the City's obligation to provide wastewater treatment services to Aqua Texas pursuant to the terms of this Agreement will commence upon construction of the 191" active residential connection with the Development. 9.04 Termination. In addition to termination pursuant to Article IX and Section 4.03, this Agreement may be terminated in whole or in part by the mutual consent of Aqua Texas and the City. Notwithstanding anything contained herein to the contrary, any material breach by Aqua Texas in the performance of any of the duties or the obligations assumed by Aqua"Texas 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 9.04. I1"Aqua Texas commits a material breach, then the City shall deliver to Aqua Texas ninety (90) days prior Notice of its intention to so terminate this Agreement, including in such Notice a reasonable description of the breach. Aqua Texas shall commence curing such breach within fourteen (14) calendar days after receipt of such Notice and shall diligently pursue and complete such cure without unreasonable cessation of activities within ninety (90) days from the date of the Notice; however, if the breach is not reasonably susceptible to cure by Aqua "Texas within such ninety (90) day period, the City agrees that it will not terminate this Agreement so long as Aqua Texas has diligently pursued such cure within the foregoing ninety (90) days and diligently completes the work, without unreasonable cessation, within a reasonable time thereafter. The time authorized by this Agreement to cure the breach is the "Cure Period." If Aqua Texas shall fail or refuse to cure such material breach to the satisfaction of' the City within the Cure Period, then and in such event, the City shall have the right with additional sixty (60) days advance Notice to Aqua Texas and without any liability whatsoever on the part of the City to declare this Agreement terminated, and the Agreement will immediately expire at the end of such Notice period. The City shall give Notice to Aqua Texas immediately upon acceptance of the cure of any default. A material breach of this Agreement includes, but is not limited to: Brookticld Wholesale Wastewater Service Agreement Page 14 1199512-I a. Failure to comply with and enforce any wastewater quality or pretreatment standards required by this Agreement; b. Failure to make any payment of any bill, charge or fee as provided for in this Agreement; C. Making any connection to the Fort Worth System at any point other than those authorized by this Agreement; d. Failure to permit any sampling of wastewater as provided for herein; e. Failure to disconnect a Prohibited Discharge pursuant to Section 3.07; t: Failure of Aqua Texas to comply with Sections 2.01, 2.05, 2.07, 2.08, 4.03 or 5.01 or Article X hereof. 9.05 Non-Material Breach. In the event of any nonmaterial breach, default or 'failure to perform duties under this Agreement, the City shall deliver to Aqua Texas thirty (30) days advance Notice of such default. If Aqua Texas fails to cure such breach, default or failure, then the City shall give Aqua"Texas Notice of such failure to cure and may surcharge Aqua"Texas Dive Thousand Dollars ($5,000) per month until such time as Aqua Texas cures such nonmaterial default. 9.06 Effect oil'Termination. In the event of termination of this Agreement, except to the extent provided in Section 9.07, all rights, powers, and privileges of Aqua Texas hereunder shall cease and terminate and Aqua Texas shall make no claim of any kind whatsoever against the City, its agents or representatives, by reason of such termination or any act incident thereto, provided the City acted reasonably and such termination was not unreasonable, arbitrary and capricious. 9.07 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 the tennination of this Agreement for any reason: (a) any payment obligation of any Party under the terms of this Agreement that has accrued prior to such termination; (b) Section 7.02 (Indemnity); (c) Article VIII (Reports and Records); and (d) Article XI (Miscellaneous). 9.06 Effect of Opportunity to Cure. "The opportunities provided in the Agreement to cure a material or non-material breach do not relieve or diminish any obligation of Aqua Texas to indemnify the City pursuant to Article VII for any Liabilities. BrooklIcld Wholesale Wastewater Service Agreement Pagc 15 1199512-1 ARTICLE X PERFORMANCE PURSUANT TO UTILITY AGREEMENT "Phis Agreement is executed pursuant to, and shall be performed consistent with the terms of, the Utility Agreement. Accordingly, all construction, operation and maintenance activities undertaken pursuant this Agreement shall be performed in compliance with the Utility Agreement, including the standards for construction, operation and maintenance set forth in Article V of that agreement. In the event of a conflict between this Agreement and the Utility Agreement, the Utility Agreement shall control. ARTICLE XI MISCELLANEOUS 11.01 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, TEXAS, AND HEREBY AGREE THAT ANY SUCH COURT SHALL BE A PROPER FORUM FOR THE DETERMINATION OF ANY DISPUTE ARISING HEREUNDER. 11.02 Notice. Any notices, certifications, 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 Brooldield Wholesale Wastewater Service Agreement Page 16 1 199512-1 City of Fort Worth, Texas 1000 Throckmorton Street Attn: City Manager Fort Worth, "Texas 76102 FAX: (817) 392-6134 City of Fort Worth, "Texas 1000 Throckmorton Street Attn: Water Director Fort Worth, Texas 76102 FAX: (817) 392-2398 To Aqua"Texas: Aqua Utilities, Inc. dba Aqua Texas, Inc. Attn: Vice-President 1106 Clayton Lane, Ste. 400W Austin, Texas 78723 FAX: (512) 263-5624 Aqua Utilities, Inc. dba Aqua Texas, Inc. Attn: Chief Legal Officer 762 West Lancaster Ave. Bryn Mawr, Pennsylvania 19010 FAX: (610) 520-9127 11.03 Consent Required for Assignment & Binding on Successors and Assig . All of' the terms of this Agreement shall be binding upon, shall inure to the benefit of, and shall 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 the other Party. 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. 11.04 Amendment. This Agreement may be amended only with the written consent of al I Parties and with approval of the governing body of the City and Aqua Texas. 11.05 No Waiver. Any failure by a Party to insist upon strict performance by the other Party of any material provision of this Agreement shall not be deemed a waiver thereof, and the Party 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 Brookfield Wholesale Wastewater service Agreement Paoe 17 1199512-1 shall be deemed or construed to be a waiver of any other term or condition or subsequent waiver of the same term or condition. 11.06 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 oi'the Parties as expressed in this Agreement, then such provision shall be deemed severed from this Agreement 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. 11.07 Captions. Captions and headings used in this Agreement are for reference purposes only and shall not be deemed a part of the Agreement. 11.08 lnterhretation. 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. 11.09 Conspicuous Provisions. The City and Aqua 'Texas 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. 11.10 No Third Party Beneficiary. This Agreement is solely for the benefit of the Pai-tics, and neither the City nor Aqua Texas 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 Aqua Tcxas. 11.1 I 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. tither 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 Dort Worth System, as a result ol'the above, requires the City to temporarily interrupt all or part Brookfield Wholesale Wastewater service Agreement Page 18 1 1995 12-1 of the services to Aqua Texas, no claims for damage shall be made by Aqua Texas against the City. I'hc City will exercise its best efforts to insure that such interruptions will not adversely affect the health and welfare of the Users. 11.12 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 Original "IRA Contract Exhibit D Map showing the Development's Point of Entry into the Fort Worth System and Fort Worth's Point of Entry to the TRA System Exhibit E Rate Methodology Brookficid Wholesale Wastewater Service Agreement Page 19 1 199512-I Mach Party has caused this Agreement to be executed by its duly authorized representative in multiple copies on the date or dates indicated below. ATTE'ST: CITY OF FOIZT WORTH _ By: _ Marty I lendrix City Secretary (print mune) Title: Date: APP12OVED AS TO FORM AND LEGALITY: Assistant City Attorney ATTEST: AQUA UTILITIES, INC. dba 4QUAEXAS, INC.y: Corporate Secretary ot . Laughman, Presid Date: January 13, 201 1 13rxl:ficli �Vlx>lo,ulc Wastcwlcr Scrvicc A�-rcci i I'u c 'O 19951?-1 Exhibit A Map of the Brookfield Development L . I I \_ �1 e v20 if Exhibit A to Brookfield Wholesale Wastewater Service Agreement Page 1 9735; G Exhibit B Legal Description of the Brookfield Development BEING a tract of land located in the WILLIAM C. HALLMARK SURVEY, ABSTRACT NO. 518, Denton County, Texas and being all of a tract of land described as "Tract 1 and 2 in Deed to Brookfield Acquisitions, L.P., recorded in Document Number 2007-45036, Deed Records, Denton County, "Texas and being more particularly described as follows: BEGINNING at a concrete monument with a 1/2 inch iron rod found in the North right-of'-way line of State Highway No. 114, a 100 foot right-of-way, at the Southeast corner of said Tract 2; THENCE.North 89 degrees 31 minutes 05 seconds West, along said North right-of-way line, a distance of 1,026.70 feet to a 1/2 inch iron rod with a yellow plastic cap stamped "DAA" set at the Southeast corner of a tract of land described in Deed to Willow Bend 114, recorded in Document Number 2005-8893, Deed Records, Denton County, Texas; THENCE North 00 degrees 19 minutes 46 seconds East, a distance of 2,518.47 feet to a 1/2 inch iron rod with a yellow plastic cap stamped "5439" found at the Northeast corner of Lot 13, Block A of WILLOW SPRINGS SUBDIVISION, an Addition to Denton County, Texas according to the Plat thereof recorded in Cabinet D, Page 317, Plat Records, Denton County, Texas; THENCE South 89 degrees 59 minutes 13 seconds West, along the North line ofsaid Lot 13, a distance of 13.26 feet to a 1 inch iron rod found at the Southeast corner of a tract of land described in Deed to Robert B. Logan, recorded in Volume 515, Page 92, Deed Records, Denton County, Texas; THENCE North 00 degrees 14 minutes 58 seconds East, a distance of 1,563.70 feet to a 3/8 inch iron rod found at the Northwest corner of said Tract 1; THENCE South 89 degrees 28 minutes 37 seconds East, a distance of 3,160.54 feet to a 1/2 inch iron rod with a yellow plastic cap stamped "EC&D" found at the Northeast corner of said Tract l; THENCE South 00 degrees 15 minutes 25 seconds East, a distance of 2,753.84 feet to a 1/2 inch iron rod with a yellow plastic cap stamped "EC&D" found at the most Easterly Southeast corner of'said Tract l; THENCE North 89 degrees 36 minutes 34 seconds West, a distance of 2,150.81 feet to a 1/2 inch iron rod with a yellow plastic cap stamped "EC&D" found at an inner ell corner of'said Tract 1; THENCE South 00 degrees 08 minutes 43 seconds West, a distance of 1,322.76 feet to the POINT OF BEGINNING and containing 231.579 acres of land, more or less. I:xhibit B to Brookfield Wholesale Wastewater Scrvice Agreement I'agc I 9735.2 Exhibit C Original TRA, Contract T-R31TITY RIVER AUMORITY OF TEX21S - DZYTON WASMaTER cvg= COL-Z CT+ THE STATE OF TEXAS TRULNITY RIVER AUTHORITY OF TEXAS V IS TRINITY RIVER AUTHORITY OF TEXAS - DENTON CREEK REGIONAL WASTEF'ATSR TREATMENT SYSTEM CONTRACT (the "Contract') made and entered into as of the 28th day of 0CT03ER, 1937 (the "Contract Date") , by and anong TRINITY RIVER AUTHORITY OF TEXAS (tha "Authority") , an agency and political subdivision of the State of Texas, being a conservation and reclamation district created and functioning under Article 16, Section 59, of the Texas Constitution, pursuant to Chapter 518, Acts of the 54th Legislature of the State of Texas, Regular Session, 1955, as amended (the "Authority Act") , and the following: CITY OF FORT WORTH, IN TARRANT COUNTY, TEXAS, CITY OF HASLET, IN TARRANT COUNTY, TEXAS, and CITY OF ROANOKE. IN DENTON C6UNTY, TEXAS, (collectively the• Illnitial Contracting Parties") . X I T N E S S E T H: WHEREAS, each of the Initial Contracting Parties is a duly created city and political subdivision of the State of Texas operating under the Constitution and laws of the State of Texas; and WHEREAS, the Authority and the Initial Contracting Parties are authorized to enter -into this Contract pursuant to the 0�'I�'IAL RECORD i I CITY SECRETARY FT. VIORT8 0. FAIIj bit c to Brook1leld Wholesale Wastewater Service Agreement Page I 97.35 2 Authority Act, Chaptsr 30, Texas Water Code, VQrnon's 2,.nn. Tex. Civ. St. A_-ticle 4413 (32c) (the "Intsrlocal Cooperation Act") , and other applicable laws; and tr ME&S, the Authority proposes to acquire and construct a regional WaLstewater treatment system to serve the Initial Con- tracting Parties Within the watershed or drainage area of Denton Creek, a tributary of the Trinity River, located izi Denton and Tarrant Counties, Texas (the "Systeaa") ; and WHFREAS the System initially proposed to be acquired and constructad is daccribed in an engineering report of Rady �c Associates, Fort Worth, Teras, entitled "Comprehensive Feasibility Study on Denton Creek Regional Wastewater System", dated August, 19B7t and W8ER8.A3, such report, including all anandments and supple- ments thereto made prior to the execution of acquisition and construction contracts for the System and as changed by change orders entered after acquisition and construction contracts for the System have been executed, is hereinafter called the "Engineering Report"; and WHEREAS, it is expected by the parties hereto that as soon as practicable after the execution of this Contract the Author- ity will issue an installant of Bonds to provide part of the money to acquire and construct the Systen, and thereafter will issue a subsequent installment or installments of Bonds to complete the acquisition and construction of the System, With 2 1"Xilibit C to Brooklicld Wholesale Wastewater Service /agreement Pa,,c 2 9735-2 all of said Bonds to be payable from and secured by Annual Payments made under this Contract by the Iritiai Contracting Parties. NOW, TKEREEFORE, i:z consideration of this mutual covenants and agreements herein contained, the Authority agraes to provide Wastewater treatment services of the System to the initial Contracting Parties under this Contract, and to issue its Bonds and to acquire and construct the System, upon and subject to the terms and conditions hereinafter set forth, to-wit: Section 1. DEFINITION OF TERMS. The following terms and expressions as used in this Contract, unless the context clearly shows otherwise, shall have the following meanings: (a) "Additional Contracting Party" means any party not defined as one of the Initial Contracting Parties with which the Authority makes a contract similar to this Contract for providing services of the System, provided ttbat after execution of any such contract such, party shall become one of the Con- tracting Parties for all purposes of this Contract, unless otherwise specifically provided herein. (b) "Adjusted Annual Payment" means the Annual Payment, as adjusted during or after each Annual Payment Period, as provided by this Contract. 3 (Allibit C to Brookficld Wholesale Wastewater Service Agreement Pa-e 9735,2 (c) "Advisor- Committee" means the co=ittee to be created to consult with and advise the Authority with respect to the System as provided in Section 10 of this Contract_ (d) "Annual Payment" means the mount of money to be paid to the huthority by each of the Contracting Parties during each Annual Payunent Period as its proportionate share of the Annual Requirement. (e) "Annual Payment Period" means the Authority's Fiscal Year, which currently begins on Decenber 2 of each calendar year and ends on the last day of November of the next calendar year, and the first Annual Payment Period under this Contract is estimated to be the period of December 1, 1989, through November 30, 1990. (f) "Annual Requirement" means the. total amount of money required for the Authority to pay all operation and Maintenance Expenses of the System, to pay the debt service on its Bonds, to pay or restore any amounts required to be deposited in any special, contingency, or reserve funds required to be estab- lished and/or maintained by the provisions of the Bond Resolu- tions, all as further described in section 11 (a) of this contract. (g) "B.o.D." (denoting Biochemical oxygen Demand) means the quantity of oxygen utilized in the biochemical oxidation of organic matter under standard laboratory procedure in five days at 20• C. , expressed in milligrams per liter. 4 L<hibit C to Brooki-jeld Wholesale Wastewater Service Agreement ptige 4 0735.2 (h) "Bond Resolution" means any resolution of .he kuthor- itv which authorizes any Bonds. (i) "Bonds" means all bonds hereafter issued by the Authority, expected to be in two or more series or issues, and the interest thereon, to acquire and construct the Systen (including all bonds issued to complete the acquisition and construction of the System) , and/or all bonds issued subse- quently to improve and/or extend the System, and any bonds issued to refund any Bonds or to refund any such refunding bonds. (j) "Contracting Parties" means the "initial Contracting Parties", as defined in the' first paragraph of this Contract, together with any other party or parties which hereafter becomes one of the contracting Partial by becoming an Addi- tional contracting Party. (k) "Contracting Party" means any one of the Contracting Parties. (1) `Engineering Report" means the "Engineering Report" as defined in the preamble to this Contract. (n) "Garbage" means solid wastes from the preparation, cooking, and dispensing of food, and from handling, storage, and sale of produce. (n) "Greasell means fats, waxes, oils, and other similar nonvolatile materials in Wastew4ter, which are extracted by 5 L•;ahibit C to Bi-ook[ield Wholesale Wastewater Service Agreement Nage 5 97.352 A Freon from as acidified sample usiaq the Partition-Gravimetric method. (o) "industrial User (IU) " Deans &riy parson, including but not limited to, any individual, firm, partnership, corporation, association, or any other group or combination acting as a ;alit, or any other legal entity, who discharges or desiras to discharge industrial wastes into the System. (p) "Infiltration water" means the water which leaks into a sewer. (q) "operation and Maintenance Expenses" means all costs and expanses' of operation and maintenance of the System and the Wastewater Interceptor System, including (for greaten certainty but without limiting the generality of the foregoing) repairs and replacements for which no special fund is created in the Bond Resolutions, operating personnel, the cost of utilities, the costs of supervision, engineering, accounting, auditing, legal services, supplies, services, administration of the System and the Wastewater Interceptor System, including the Authority's general overhead expenses attributable to the System and the Wastewater Interceptor System, insurance premiums, equipment necessary for proper operation and maintenance of the System and the wastewater Interceptor System, and payments made by the Authority in satisfaction of judgments resulting front claims not covered by the Authority's G Exhibit C to Brooklielci Wholesale Wastewater Service Agreement Pa-e 6 9735.2 L-isurance arising in connection with the operation and maLnte- na.nce of the System and the Wastewater Interceptor System. The term does not include depreciation. (r) "pH" means the common logarithm of the reciprocal of the weight of hydrogen ions in grams per liter of solution. (s) "Project" means the "Project" as defined in the preamble to this Contract, and as generally described in the Engineering Report. (t) "POTW" means Publicly Owned Treatmant Works as defined in 40 CPR 403. (u) "properly shredded Garbage" means garbage that has been shredded to such degree that all particles will ba carriad freely under the flow conditions normally prevailing in public sewers, with no particle greater than 1/2 inch in any dimen- sion. (v) "significant Industrial User (S N) " means any indus- trial user who is connected or desires to connect to the City0s domestic wastewater collection system and meets at least one of the following criteria: (1) Average industrial wastewater discharge rate greater than 50,000 gpd. (2) BOD and/or suspended solids concentrations in industrial wastewater greater than 250 mg/1. (3) Industrial category regulated by l7ational Pretreatment Standards as promulgated by the United States Environmental protection Agency. 7 exhibit C to Brookfield Wholesale Wastewater Service /agreement I'age 7 9735 2 (w) "Suspended Solids" Deans solids that dither float on the surface or era in suspension in water, sewage, or other liq-sids, and which are removable by laboratory filtering, expressed in milligr—s per liter. (x) "Systea" means the regional wastewater treatment system descried in the preamble to this Contract and in tha Engineering Report, and all improvements and additions to and extensions, enlargements, and replacements of such facilities which are deemed necessary and feasible by the Authority in order to receive, treat, and dispose of Wastewater from Con- tracting Parties and to comply with the requirements of the Wastewater regulatory agencies of the state of Texas and the United States of Amarica. Said term does not include any facilities acquired or constructed by the Authority with the proceeds from the issuance of "Spacial Facilities Bonds", which are hereby defined as being ravanue obligations of the Author- ity which are not secured by or payable from Annual Payment.% made under this Contract and similar contracts with Additional Contracting Parties, and which are payable solely from other sources. (y) "Total Toxic organics" means the sum of all detected concentrations greater than to micrograms per liter for all organic compounds classified as priority pollutants by the United States Environmental Protection Agency. 8 Exhibit C to Brookfield Wholesale Wustewater Service Agreement Pagc 8 9735.2 (z) "Trunk Sewer" means any sewer in which sewage from collecting and lateral sewers is concantrated and conveyed to `he System. (aa) ,Wa.stewatarr means Sewage, Industrial Waste, Munici- pal Waste, Recreational Waste, and Agricultural Waste, as defined in the Texas Water Code, togethe_ with Properly Shred- ded Garbage and such Infiltration Water that may be present. (bb) "Wastewater Interceptor . System" means the "Interceptor' System" as defined in the "Trinity River Authority of Texas - Denton Creek Wastewater Interceptor System Contract" , dated October 28, 1987, executed by the parties to this Contract concurrently with the execution hereof (the "Interceptor Contract") , and being facilities intended to collect and transport Wastewater into the "System", as defined in this Contract, together with any other Wastewater collection and transporation facilities which are not part of the System as herein defined, and which are intended to collect and transport the Wastewater of any Additional Contracting Party into the System as herein defined. Section 2. CONSULTING ENGINEERS; CONSTRUCTION OF SYSTEM. The Authority and the Contracting Parties agree that the Authority will choose the Consulting Engineers for the System, provided that the Consulting Engineers may be changed at the option of the Authority. The Authority agrees to issue its Bonds, payable from and secured by Annual Payments made under 9 I:XhiMt C to Brookfield Wholesale Wastewater Service Agreement Panyc 9 9715.2 this C.ontract, to acY {re znd construct the Systam, and agr®es :at the System will ba acquired and constructod in general accordance with the Engineering Report. It is anticipated that such acquisition and construction will be financed by the Authority through the issuance of two or more series or issues of its Bonds payable from and secured by Annual Payments made under this Contract, and the Authority agrees to issue its Bonds for such purpose. The proceeds from the sale and de— livery of such Bonds also will be sufficient to fund to the extent deemed advisable by the Authority a debt service reserve fund, a contingency fund, and interest on the Bonds during construction; and such proceeds also will be used for the payment of the Authority's expenses and costs in connection with the System (including all engineering and design costs and expenses, and the cost of the land and interests therein related to the System) and the. Bonds, including, without limitation, all financing, legal, printing, and other expenses and costs related to the issuance of such Bonds and the System. It is now estimated that such Bonds to acquire and construct the initial System will be issued in an aggregate amount of approximately $2,800,000 (whether actually more or less) , which sum is now estimated to be sufficient to cover all the aforesaid costs, expenses, and other amounts. Each Bond Resolution of the Authority shall specify the exact principal amount of the Bonds issued thereunder, which shall mature io 1"AlliNt C to Brookficld Wholesale Wastewater Service Agreement Page 10 9735.2 within -henaxsmtm period, and sha11 bear interest at not to exceed the maximu= rates, then permitted !:T law, and each Bond Resolution shall create and pra`side for the naintenance of a revenue fund, an interest and sinking fund, a debt service reserve fund, and any other funds deemed advisable, all in the wanner and amounts as provided i., such Bond Resolution. Each Contracting Party agrees that if and when such Bonds are actually issued and delivered to the purchaser thereof, either for the purpose of initially acquiring and constructing the System, or subseguently for improving and/or extending the System, the Bond Resolution authorizing the Bonds shall for all purposes be deemed to be in compliance with this Contract in all respects, and the Bonds issued thereunder will constitute Bonds as defined in this Contract for all putrposes. section 3. QUANTITY AND pOI11TS OF ENTRY. (a) In con- sideration of the payments to be made by each Contracting Party under this Contract, each such Contracting Party is entitled, during each Annual Payment Period while the System is in operation, to discharge into' the System at its Point or Points of Entry hereinafter described, all of the Wastewater which is generated within its boundaries which are within the watershed or drainage area of Denton Creek, subject to the restrictions hereinafter stated; and provided that each such Contracting Party must transport such Wastewater to its Point or Points of Entry. Further, each Initial Contracting Party shall be 11 I?xhibit C to E3rooklic1d Wholesale Wastewatel' Scrvice Agreement I'age 1 I 97352 obligated to transport and discharge into =hs System at its Point or Points of Entry all Wastewater which is generated within its boundaries which are within the watershed or drainage 3raa of Denton Creek, except for reasonably small fringe areas which could be more cost effectively served by other maans, and which are approved by a majority vote of the Advisory Committee and approved by the Authority. (b) The combined 1,ax=um rate at which Wastewater is dis- charged by each Contracting Party at all of its Points of Entry shall not exc9ad a rate which, if continued for a period of twenty—`our hours would equal 3.50 times such Contracting Party,ls estimated average daily contributing Plow of Wastewater for that then current Annual Payment Period. The total quantity of Kastevater discharged into the System shall never exceed the amount which the System is capable of receiving, treating, and disposing, unless approved by a majority vote of the Advisory Committee and approved by the Authority, subject to terms and conditions to be established by the Authority. Notwithstanding the foregoing, no Contracting Party shall ever make any dis- charge into the Systems which would cause it to be overloaded or be in violation of its permits from the State of Texas and/or the United States of America. (c) Wastewater meeting the quality requirements of Section 4 of this Contract will be received into the System at the Points of Entry, respectively, shown for each Initial 12 I'AlliNt C to Brookfield Wholesale wastewater Service Agreement pa„e 12 5 97 35.2 Contracting Party, respectively, in the Engineering Raport, or at such other or additional Points of Entry that may be estab- lished by mutuAl agreement between the Authority a.*kd a Con— tracting ?arty in the future, if such other or additional Points of Entry are determined by the Authority to be econom- ical and beneficial to the System, and such Contracting Party pays any costs related thereto which the Authority determines should be paid by such Contracting Party. (d) It is the intention of the parties hereto that the System shall be acquired, constructed, extended, and improved so that at all reasonable times it will be capable of receiv- ing, transporting, treating, and disposing of all eligible Wastewater generated within the boundaries of each Contracting .arty which are within the watershed or 'drainage area of Denton Creek and which such Contracting Party delivers to its Point or Points of Entry, and that the Authority will from time to time issue its Bonds in such amounts as are, within its judgment and discretion, sufficient to achieve sucli results. Section 4. QUALITY. The obligation of the Authority to receive into the System such Wastewater depends upon compliance by each Contracting Party with the provisions of this Section. Ggnel:al objectives ofQuality RecTu7C9 - In order to permit the Authority to properly treat and dispose of each Contracting Party's Wastewater; to protect the public health; and to permit cooperation with other agencies 13 Exhihit C to f3rookfield Wholesale Wastewater Service Agreement 11ai­c 13 9735 2 which have requirements for the prota'r ion of the Physical, chea.ical, and bacteriological quality of public water and water coc:rsas, and to protect the properties of the System, each contracting Party egress: (a) Admissible DJ, h-nrae-s i to �iuthoxitvfs Svc ezn. Discharges into the System shall consist only of wastewater and other waste free from the prohibited constituents listed in Subsection (b) and limited in B.O.D. , Suspended Solids, dis- solved sulfides, and pH as hereinafter provided. (b) Wastes Not A�iagible. Gasoline; cleaning solvents; non emulsified oils and greases; mineral oils; ashes; cinders; sand; gravel; tar; asphalt; ceramic wastes; plastics; other viscous substances; feathers; hair; rags; metal; metal filings; glass; wood shavings; sawdust; unshredded garbage; toxic, corrosive, explosive or malodorous gases; acetylene generation sludge; cyanides or cyanides or cyanogen compounds capable of liberatling hydrocyanic gas on acidification in excess of 2 mg/1 by weight as cN; radioactive materials which will permit a transient concentration higher than 100 nicrocuries per liter; emulsified oil and grease, exclusive of soaps, exceeding on analysis an average of 100 mg/1 of ether-soluble mattar; acids or alkalis having a pH value lower than 6.0 or higher than 10.0; and wastewater containing specific pollutant concentra- tions in excess of any of the numerical limitations naned hereunder be prohibited from discharge to the System: 14 1:0 ibit C to Brooklicicl Wholesale Wastewater Scrvice Agreement Page 14 9735 2 ?!aximum X?lowable mal utast C2ZgSZtzAtion Arsenic I D 0 3arium 1, DDO Cadmium 1DO Ctiromium 1, DDO Copper 1, 500 Lead 1, 000 Manganese 1,500 Marcury 5 Nickel 1, DDO Selenium 50 Silver 100 zinc 2, 000 Total Toxic Organics 1, 000 (c) Biochemical OxYcren Demand (B-0, Pt ) - B.O.D. of Wastewater delivered to the System, as determined by standard methods, shall not exce*d 250 mg/l. (d) Total SLSRended Solids. Total Suspended Solids delivered to the System, as determined by Standard methods, shall not exceed 250 mg/l. (e) X0a.nIon Concentration The pH of Waste- water delivered to the System shall be not lower than 6. 0 nor higher than 10.0. No acids- shall be discharged into the Authority's system unless neutralized to a pH of 6.0 or more. (f) Hydrogen on. Dissolved sulfides in Wastewater at the point of delivery to the System shall not exceed 0.1 mg/1. (g) Prohibited Discharae Limitation Suct to r"r, e. Notwithstanding the foregoing provisions of this Section, the IS L?shiNt C to L3rooklIeld Wholesale Wastewater Service Agreement Page 15 9735,2 parties hereto agree ani understand that Federal and Stata Pogulatory Agencies periodically modify standards on prohibited discharges; tharefo=e, revisions to, additions to, or deletions from the items listed in this section may become necessary in the future to comply with these latest standards. It is the intention of this Contract that prohibited discharge require- ments be reviowed periodically by the Authority and revised in accordance with the latest standards of any Federal or State Agency having regulatory powers. Any required revisions shall be mads and written notic4 thereof given to each Contracting Party. Each Contracting Party shall be responsible for inte- grating such changes into the local industrial waste ordinance and notifying- all affected users of the change within ninety days following written notice to the Contracting Party of such changes. (h) To determine normal quality of Wastewater, the Authority will collect twenty-four hour composite samples of Wastawater at each Point of Entry and cause sama to be analyzed in accordance with testing procedures as set forth in the latest edition of zj nation of Water and Wastewat�ar, published by American Public Health Association, Inc. Composite samples will normally be taken once a month, or at more frequent intervals if necessary to determine Wastewater quality. As provided above, such Wastewater shall not exceed 16 0:X1111)11 C to Brooklicld Wliolcssilc Wastewater Service Agreement Pa-c 16 9735 2 the limits of concen`,sation specified for Normal Fastcewater as follows: L,,s---rrr i uiZS�'a�rrt�'' Co72CQntratia:l 30D 250 mg/1 TSS 250 mg/1 PH, not less than 6 nor greater than l0 Hydrogen Sulfide 0.1 mg/1 Should the analysis disclose concentrations higher than those listed, the Authority immediately will ,inform the Con- tracting Party which made the discharges resulting in the violation of this Section, and such discharges shall cease immediately• However, ;rith the approval of the Authority, Wastewater with concentrations of BOD and TSS greater than specified above may be discharged by a Contracting party into the System on an emergency and temporary basis, subject to the payment of a surcharge in addition to all other payments required by this Contract) , which surcharge shall be determined by the Authority and shall be in an amount sufficient to cover and pay for all additional costs of transportation, treatment, and disposal related to such discharges. Section 5. METMU NG OF WASTEWATER. The Authority will furnish, install, - operate, and maintain at its expense the necessary equipment and devices of standard type required for reasuring properly all Wastewater discharged into the System by each contracting Party, respectively, through its point or points of Entry, respectively. Such meters and other equipment shall remain the property of the Authority. Each Contracting 17 l:.NltiNt C to Brooklield \�Jholesalc Wastewater Service Agreement Pa��c 17 97352 Party shall have access to such metering equipment at all reasonable times for i.nspsction and examination, but the readirr3r calibration, and adjustment thereof shall ba done only by employees or agents of the Authority in the presence of a. representative of the affected Contracting Party or Parties if requested by such Contracting Party or Parties. All readings of meters will be entered upon proper books of record main- tained by the Authority. Upon written request any Contracting Party may have access to said record books during reasonable business hours. Not more than three times in each year of operation, the Authority shall calibrate its meters, if re- quested in writing by the affected Contracting Party or Parties to do so, in the presence of a representative of such Contract- ing PartY or Parties, and such parties shall jointly observe any adjustments which are made to the meters in case any adjustment is found to be necessary. If, for any reason, any meters are out of service or out of repair, or if, upon any test, the percentage of inaccuracy of any meter is found to be in excess of five (5%) per cent, registration thereof shall be corrected for a period of time extending back to the time when such inaccuracy began, if such time is ascertainable, and it not ascertainable, then for a period extending back one-half (1/2) of the time alapsed since the data of the last calibra- tion, but in no event further back than a period of six (6) months. Any Contracting Party may, at its option and its own is I`xlilbit C to Brookfield Wholesale Wastewater Service /agreement Parc 18 9735 2 expense, install ani Operate a check meter to -heck Bach meter installed by the Authority, but the meac"rement for the purpose Df this agreement shall be sol*ly by the Aut_5ority's meters, except as in this Section specifically provided to the con- trary. All such check meters shall be of standard make, shall be installed in a location approved by the Authority, and shall be subject at all reasonable times to izL,pection and examina- tion by any employee or agent of the Authority, but the read- ing, calibration, and adjustment thereof shall be made only by the Contracting Party or Parties, except during any period when a check meter may be used under specific Smitten consent by the Authority for measuring the amount of Wastewater delivered into the Systen, in which case the reading, calibration, and adjust- ment thereof shall be made by the Authority with like effect as if such check meter or meters had been furnished or installed by the Authority. Section 6. UNIT OF MEA.SURE24ENT. The unit of measurement for Wastewater discharged into the System hereunder shall be 1,000 gallons, U. S. Standard Liquid Measure. Section 7. LIABILITY FOR DAMAGES AND RESPONSIBILITY FOR s TREATMENT AND DISPOSAL OF WASTEWATER. Liability for damages arising from the transportation, delivery, reception, treat- ment, and/or disposal of all Wastewater discharged into the System hereunder shall remain in each Contracting Party to its point or Points of Entry, respectively, and title to such 19 Hx1libit C to Brookfield Wholesale Wastewater Service Agreement Page 19 97352 W&Stewater shall be in such contracting ?arty to such Point or Points, and upon passing through Points of Entry liability for such damages shall pass to the Authority. As between the huthority aad each Contracting Party, each party agrees to indemnify and to save and hold the other arty harmless Lrvin ap any and all claims, demands, causes of action, damages, losses, including reasonable attorney's costs, fines, and expensas, feeS, which may arise or be. asserted by anyone at any time on account of the transportation, delivery, reception, treatment, and/or disposal while title to the Wastewater is in such party, or on account of a prohibited discharge by a Contracting party. The Authority has the responsibility as between the parties for the propar reception, transportation, treatment, and disposal of all Wastewater discharged into the System, but not for Prohibited discharges discharged by any party at any Point of Entry. section 8. REPORTING REQUZ TS. (a) Approximately thirty days after the end of each Annual Payment Period each Contracting Party, respectively, shall furnish in writing to the Authority the following information with respect to such Contracting Party: (1) The number of active domestic sewer connections tributary to the Systen and which will be served by the Systela; (2) Tho number of co=ercial and business sewer connec- tions to be served by the System; 20 Exhibit C to Brookfield Wholesale Wastewater Service Agreement ��`� e ��� 973>2 (3) The number of industrial connections to be served by the System, with -sane and location of each. The purpose of this provision ie to permit the Authority to ac=ulate statistical data which will enable it to render better service and facilitate plans for betterment and future facilities expansion. (b) ct-ri al waste. The effects of certain types of Industrial Waste upon sewers and sewage treatment processes are such as to require that careful consideration be made of each industrial connection. This is a utter of concern both to the Authority and to the Contracting Parties. Accordingly, each Contracting party shall regulate the discharge. of industrial Waste generated by a SIU into its sewer system, and will authorize discharge of Industrial Waste into its sewers subject to the general provision that no harm will result from such discharge and subject to the filing by applicant industry of a statement, copy of which shall be forwarded to the Authority, containing the following information: (1) dame and address of applicant; (2) Typo of industry; (3) Quantity of plant waste; (4) Typical analysis of the waste; (5) Type of pre-treatment proposed. To facilitate inspaction and control of Industrial Waste, each Contracting Party will require industries to separate 21 lxhibit C to Brookfield Wholesale Wastewater Service Agreement ('age 21 9735.2 Zndustrial Haste from Sanitary Sewaga until sucb inffustrial Waste has passed through a monitoring portal which shall be located so as to be aecassibla at, all times to inspectors of such Contracting ?arty. If inspection indicates that daiaage might result from the discharge the permit shall be revoked unless and until the industry. promptly "tablishes acceptable remedial measures. At regular intervals the Authority will collect twenty-four hours composite samples of all Wastewater at each Point of Entry and cause same to be analyzed by American Public Health Association Standard Methods. Such Wastewater shall not exceed tha liAits of concentration specified in Section 4 of this Contract. Should the analysis disclose concentrations higher than those stipulated the Authority immediately will inform the affected Contracting party of such disqualification. It shall be the obligation of such Contracting Party to require the offending originator of said highly concentrated materials to immediately initiate and undertake remedial pre-treatment or other legal means before discharge into such Contracting Party's sewers. (C) =,j_nanCes. Each Contracting Party, respectively, agrees that it has enacted or will enact ordinances as neces- sary to include the following provisions: (1) For each existing and future SIU, the Contracting Party shall require said user to complete and submit a permit application containing that information specified' in the sample 22 Exhibit C to Brookfield Wholesale Wastewater Service Agreement Page 22 97352 application form which is attache3 hereto as Exhibit 1 irzedi- ately following this Sa-tion 8 (c) . The Authority shall ha provid.ad a copy of the permit application within thirty days after recaipt by the Contracting Party- The Authority shall provide comments on Said application within thirty days of receipt and return comments to the Contracting Party. Failure to co=ment shall ba construed as concurrence by the Authority. After approval of the Permit Application by both the Contracting Party' and the Authority, the Contracting Party shall issue a permit to discharge containing the requirements as shown on the form which is attached hereto as Exhibit 2 immediately following Exhibit 1 At the end of this Section 8 (c) . said permit to discharge shall be' required of all SIUs before said user will be allowed to discharge industrial wastes into the sewage system. A copy of the permit to discharge shall be forwarded to the Authority for approval prior to the issuance to the SIU. (2) The Contracting Party shall require significant industrial users to comply with applicable Federal Categorical Pretreatment Standards as well as any applicable state and local standards. (3) The Contracting Party shall maintain certain informa- tion contained in permit applications as confidential at sIU's request. 23 Exhibit C w BrooklIcILI Wholesale Wastewater Service Agreement Page 23 9735 2 (4) The Contracting Party shall disallow dilution as a merits of reducing pollutant concentrations in an SIU's waste stream. (5) The Contracting Party shall be authorized to enter SlU premises at any time for independent monitoring, inspec- tion, or review of applicable records to determine compliance. (6) The Contracting Party shall develop and require adherence to SIU compliance schedules. (7) The Contracting Party shall require self-monitoring and reporting at SW's expense. (8) The Contracting Party shall choose or approve labora- tory to analyze industrial wastes. (9) The Contracting Party shall require slats to pay applicable fees for: (i) sampling and testing to determine compliance (ii) disconnection/reconnection of service resulting from noncompliance (iii) abnormal strength wastes (iv) additional costs incurred by Contracting Party or POTW in transporting or treating wastes (v) filing, revision, or renewal of Permit Application (10) The Contracting Party shall provide public notifica- tion for instances of violation. 24 FIXIIINt C to Brookfield Wholesale Wastewater Service Agreement Page 24 9735 (11) hm Contracting ?arty shall deny/revoke permit, disallow/diaco:sneat cervica, assess civil oz cr<_sinal penal- ties, and tack other available 104&1 and equitable remedies against S= for: (i) discharge .to sawerage system rasultinq in violation of poTw,s discharge permit conditions (ii) hazard to health or lif4a of POTW personnel or users of receiving waters violation of any applicable ordinance or regulation (iv) false information transmitted to approving authority through Permit Application, monitoring reports, atc- The Contracting Party shall furnish to the Authority all documents and records, in addition to those outlined herein, as necessary to demonstrate compliance by all industries. 25 Exhibit C to Brookfield Wholesale Wastewater Service Agreement Page 25 9735 2 EXHIBIT 1 PEPUMIT APPLICATION CITY OF Dite: To: Signiffcant Industrial users FrCA, Subject: Applfcatian for a Pernft to 0tsch4rye lndustritl wastewaters to the Sanitary Sewer System. Drdintnce mer has been adopted for the purpose of regulating the Quality or industrial waste wiLers contributed to the saottary sewer. The o►Jectfres of the Ord Wace are to prevent damage or obstrvctlon to the sewer, tto he aTrinitrtRfver Anthorttrthand toncanmywr withCest tcaandnfedertl gulations regarding pratceatuent Of. industrial wastes. Significant industrial users must obtaln a Permit to discharge Industrial wiStcwtters to the sewer. The Permit authorites your discharge and sets forth criteria for discaurge Quality and requireaaents for reporting. The attached appli a tion for a Perwit must be completed and returned to the calling address Showa below within 140 days. A fee of must accompany this Application. The City and the Trinity In ver orsty will reviewyour aPPfi utioa. Additional laforeatioa lute is evfdence of treatability azar be requested from tither entity. The City rill return a Permit to you upon approval of your application and will either approve or deny said application within 90 days of its recciPt by City. Pleasc address Qutstfons cmcerafnq the Industrial Wastewater D.-CIA-Ince Permit to: r 1 Lxhibit C to Brookficld Wholesale Wastewater Service Agreement Pagc 716 9735 2 EX.4I81T 1 (CONT-D) APPL:CATtoa FOR A ?MKIT TO Ol'>Caz%r IKWST4lAL VA-STOUTER T? M SMIUXr sr-drt Ks:e io Sigaiag orficltl: please mnplt:e and return this appi'iutioa Yithin IN Cars. Signing officials oust hart amth"Izatiom to proriat inroraat.on on behalf of the e*%PaQy. Infarottloa considered UelfideAttal by your coopzar shosld be clearly marked $• that itis tarorastiorn caa be nalataintd in separate, 114tted access files. Sr.t.TlOat A. GEKEXkL IKrOCXATIOK I. Company wwe 2. Mailing address ip w t 3. Facility address t epnoae &iaber (address Witte stwer services rtgvecteol� B. is company currently in operation at factltty address? TF3 SECTIM B. p1t0Dt1CTY RR SarICE IXFOMTjOM 1. Brief descrtptton of oawrftcturtng processes or service activity at the facility including rate of prodvetioa. if applicable: 2. principal raw otteriais. tacluding dtiaeicais. catalysts. Solvents, etc.. used in arty phase of the aansefacturinB process or service atttrtty: I. Kunber of employees . Mours per day of operation pan per west of operation 4. Standard Industrial Code &tuber (4 QiQits). 5. List other t-mvironaental control permits held at this tine. i 6. Attach a property plat prepared by an en4inetr- or architect shoring tocstions of water and sewer coonecttoai. nanhotes, traps, etc. Also Indicate tht lautions of an acceptable monitoring station for coilecttng sa,oples and ■etsvrin9 rima of the tndvstriai wastewater streaas prior to discharge to the sanitary sewer. Exhibit C to Brookfield Wholesale Wastewater Service Agreement Pa-e 27 9735 2 :X:i:81T Z PERMIT FOM ClTr Of PERMIT TO D1SCKl.RGE IKDUSTRIAI. WASTEWATERS TO TKE SAKITART SEWER Kane of Industry (Peresttte) Address DCai on of sewer service) parent Ks. Account Mo. Tne bort named Peralttcs is authorized to dtscurge i*dustrsal wastewaten to t.f* tanitary sewerage systoo hording to the prortsions of this per.it. Antharilttion is graatW fat t ptttod Leginnteq until u:norized preseau sere City of J Exhibit C to Brooklield Wholesale Wastewater Service Agreement page 28 97352 EXHIBIT 2 (CDHT`:) A. EFrL.J:YT LNITAT10ta Tne Qvality or ptr:ittee's tAdQftrial Qiscnarges rill be tial:ld by CAe prawisfoat of City 0.-Oinance Ib. and :be Ratioaal Pretreata►et AeRvv)ttions %mttp include the following Ica) iimttations: STAHDAIRCS Pollutant or A►�trage eoncen:ratioe Manzi Allowable and/or Load Potivtant Proptrty Loncentratton. op/1 a+p/) or lb/day -- The discharge of any pollutant at a level iq Mess of that identified And av:harped by this permit, shall coeistltvte a violation of the terst an$ conditions of this permit. Such a riolatioe may result In permit revOcstian and/or the taaposition of civil and/or criminal penalties, a. rOK)T07ctlil: no tErNTIpa 1. permittee 0411 c011ect representative sampies of the wastewater discharge and analyts these waters for the pollutaats Indicated in Stction A. Where feasible. saa►ples $.hail be obtained using flow proportional coopatftc $.aapitr►a tethnfQnes tpeciffed in the applicable G tcgort u 1 rrctreatsent Standard, inhere cOmpo9itetomptiny is not feasible. grab sampling is acceptable. Thi pe:rotttee $.Anil collect and a4aiyze saoeole(s) during a period. �nvaaer} In twat) 2. Persfttee shall sva+aarire monitorinT inforustfon on a copy of the attached 'Significant industrial tier Self Monitoring Report' lora. Dvoitceces of this form shall bt submitted during the months of and of each year to: City Enginetr Llty of with copy to: Pretreatment Program Kanager Triafty River authority of Tesas P. 0. ltpa 240 Arlington. Texas 160I0 Exhibit C to Brookfield Wholesale Wastewater Service Agreement Pagc 29 9735.2 n EXHIBIT 2 {CDk7'D} 3. Failure to iutnit any rtport or tnfornatton regvir�d by cball this psrait Constttrte TSolttiow. 4•• AN cungcs in the claracteristitt of the industrial d4char9ts as a result of oodifi a tions to the indvstrtal processes oust be reported. lied'ficitioas to the persit a&y then be aiet to rtfltcc s:y nettssarr changes to process coaditioas. in:ludta9 A" necessary effluent "wIthis Permit for an t 'r pollutants not ""'t ifitd and Batted herein. Thtt panic is sot traasferrabla co coapaaies or processes other than Skase to ditch it is originally tttuad. S. Permttttt shall i+sudiately r4tify the trtatatnt plant manager rt (2I4) 225:3462 ill the event of a slvq laadfng of polivraats as a result of itsopera:ioaal failure of pretreatment facilities or accidental spills. 6. hmittet mmt euintttn records of all iAforaatton resultiaq from any eonito'ripg acttrities for a mutase period of 3 rears. Such rtccros rill (041 udt for all samplts: (i) The dile, eiact plate, method. and time of sampling and the names of the person ar persons taring the samples; (ii) I'M dates that &Aalrset were prrforoed; (lit) I** performed the analrtts; (tv) The analytic 1 ttchniQvtt/aethods used, and (T) The retalts of tech analysts. Rreords shall be nude araflable for iec nspttoa and copying br the titr. or its representatives. 1. Compliance Schedule: altfTftr oast ti• Permittee is advised that he nay get,, to rowptr with additional regs+latfons listed as follows. Exhibit C to Brookfield Wholesale Wastewater Service A-reement Pagc 30 9735.2 EXHIBIT t (CONT`D) ,ECT:-W C. I1k5rr- ArE1tDISCKJUCt 1Kr0WrtCK 1. [Watt the es and pj►ntity of InCcctri►1 waster►ter 5y cmpletSng the table btltyp ow CMck lndistr[al Flow Floe Flow A-ppropriste Flpw Ketered Estiau teC Raprsed lax For average Ditty/ (che:t {chrct for xer Type Of K►zfauts Daily if res) if res) lodrstry Yaste�ater (check if res) (a) Procecs Sastcv&ter; Continuous Disch►r?e to tch Discharge (t,) boiler 810-gown (c) Cooling vater Aelease (d) Plant and EQvfpseat Washdown (e) Other sFr- y For each wastewater "re" attach a ;thematic of water flow that depicts the water source. tadustrial units where water is used and pretreatotnt units. Z. Wastewater Quality. 7Ae applic►at oust present information on the Quality Of Industrial wascew4ters. Samples collected from wastewater should De rcpratcntatire of dailstreams y operations. ltnalrttcat 'procedvres shovld follow those in StUndard tSethods for the Examination of Vater an .Wastewater. AFKA_A;etA_ c Ct ton. . Exhibit C to Brookfield Whoicsalc Wastewater Service Agreement Page 3 1 9735.2 _XHI8I7 1 (COX7'D) (►j ►rtarllr /51lnt•wt IwhrsXie•t riNst /•�{ult ►T )15ct•t µ •_• iJ ;l.t 5t1►5»rtat5 Yr. of 85th tilt" cln.Ictt w§w*. v It t} •trtpeclN tr ►t "I"1% •tone to Mt-4stet'. .sovotcuff to he IMet4wt5 w It a&-* to k tr5►e•t5 Is rose 69405l11►I• ►f.M" Wt. ! lop st►ttce aett.itt or, fr•trJtrJ 5s t nth s� :tutrx =mg.* =s z r t. •s.at•s (Tl....., EE i I f 1 tt, l.Ir,ulawes►..► L cr»... (utalt [ } [ j l}. (.t.rldiaww � vr•.t.3.esut I a.ta) ) ) •t. r.ttchi+.w...l •.roll►.. (t...,l {tI �. �t.etsl«. J, erMr (e••al I I rL t!1 1 awl i. •.�,►r�.V�) II tt. NJfML 1 43�►ast..,r.t.... ( rt, rlrtyt J+M�•I Ne J. IN• tt Ralt ([ tv. t.11z.rtyq..r+.t t7 N. •••shoo (I.tt 1, tt. M••t►•f{ rScaylK• [ It, 118..1 ttrtlJ N. flrldrr t+t►5ltt► jj :t. a.l••ar tarter} r,, •• ' 1 SL tll.to tlrtt+ clrl 0.t►•14" tlJ 1R t.t{t5►a►pt.rlq!/•s.•1 ' . ta.,l►,. Mtotal rt, t.t+ef.rtrrw.•il t tt. tIK ttKStl M. 4tit•tVsl.•a..w8 !`` 1t. ats•�•Mt•..a at. I.ar1•ltretN,e..t UL rrs,.t• � � Rl. wwetNrt�arlK tJ. t•r,t�,Vita /f. sawlatl•s.tf l I j A. too solhAs It. b-&-* K. WIN 1 7 rl. b vwM or. wlr i•61.ry/r Il l 1 1 rah t..5s • r.aawtw ` K. 5tyh•••s•s l tt. er•aJ Is. tlrrt"am•s tr ��' f 555,`5" a�r*1.r f n. s.•w t�rt...ws...t et. b"wowso 94 hasamiff betswr.w 3It. 04-C("Its '• )j ) Jac. M�•Kea►•.s..►.wa•a•5.t4e.e t ) 13. .I;'`(`2(.9.�....[.,t,A•ar ►t. ,r•r tt.t.t-t;1,r►•.-e j � 3 S(( F )a. Nt tt•Wwar►q aNr► t4 15rMrs.► }t, NJ i•ial5w ots"pr:,A4. 1 ef. .stylr.r glrt5h 1405 tl• t+tl•r••rt5,tJ.tor ; tK as•t►.la•r bt. }t, Nt trrM laasrt]rYrIs" 1 IQ. 9 --►1y-wP Iht. • try + f T. ••..fw IJO. a�ltr►.w.r1 ty wa•a'awryt/•�► etrlr ) IKW-t., `L 5.t,t1..pl ,.,•.E.,S 3 lies ro.ul'i�Arr�,1MtY J, t.rtr t+VMIM/1f # 1 , 1te. 407-trn tt, cwr6 JJ)) MR. no-1.:1 N. Vctta�_3�1~►�rl t( S ite. KJ.EN2 N. 9%4 sr" t 1 i ) ! t[t_ Ks-rtPCs-Itw- { 1 ( I tr. c•a ts•ti••..a (( lY t+. t.t►►onw.p,l.t.,l •t••r t ttt. ns-Use ( t ( ) th, t•.awrrtw. t ) fit. rrM.t•Iwrrrl ►1. i< Ir'•Vr�w,.r S itt. r►..w�..r 4 j{(1 s c 17( �j It. t-aj 115. If. t.[tl•.•+•r.rlr..,! .a... 111 lir. rr'.•t Ila. t.t.t,MSlwtN.ra.ett..rt. f ) ►5555... d l .,IYt. ! i I >� t,t•. 50C t 1 lrf, I,t.t.f.[rt.•c►1.•.«t.w "., t.,.r.c,t...,....• ter. ana.•.• M.►J ..et.wY t t ) Ill, t.lrr t►, rla+s..a•►•re.n Yr i ltf• t«twwr H, l.f 4M►r.r/... t21. I.f,S.JrIP1a,Wwp.n II_ t,1rt[•t..r..t... itch t,t.l.trecwlars.tw..s I C ' ttt, l.l.f•trtc�lrwf•..• I IL t,ly►n[r.•.►,r l[[)))) gm t'Mtrwt•..► I 1 1 1 a►. l.t'kta•trrr.tarW r� up.r, erte.lahlt..ti..evr ter, nlwr,fl.rartw , I ! 11 �' t.t.t-artt•L.•er.nrl I 11 ►t. LI�,aN«.stow } ttf, .bot t•J rr,M II 1 ( I 11 Exhibit C to Brookfield Wholesale Wastewater Service Agreement Page 32 97352 EXCUT 1 (CONT'G) For cal maDomds match ere 1nCitttLd to be 'Znown present' pltete Litt u>Q Provide ae Chthe fol2Drtny atU ror each (AtttC:A ddlitfonal Sbcttt .r nt:tota). Estfnited keeraye tuXt.w Maw 1 Lcss To Conctntrtttom Conceatrittan ter ' C7,e,etcal Usage (Ibi%Jear� Ea DischargeCoapoung IbsIn Dftety rye Exhibit C to Brookfield Wholesale Wastewater Service Agreement Page 33 9735,2 1• Is Tour CSschrrye cvbsect to ratioatl prttrettaent >Larw`trds rttaDlS:htd under 40 GFR, Ch4pter I, Sub:hapter R. tE5 H0 ht gvestlon ays tnfamaliot be aasertrtd ertth eertataly. For aCdtttoetl ttlon regtr1log W tloatl tretrettment Standards, ap=lictat shoals canttct Rtgioa n of the Enrlro:mcatal Nrotectian Ageacr at (21<) 11should or the Trintty Rirer furthoarity, Northern leglaa Office it (Bi W} 4)j?S7Z]. <. For uistfng stgniftcaat industrial rsert. it tAe aasrer to the abort Qsescfoe is res. Please indicste the apps(cable ptche &atmrnt o the a to the space p*arfded below air/ tttacA a sttteeon= reviewed by applicant's tutMrired represfttatire and Certlffe�s Qualified tndiutiag reeetDer applicable pretreataeat stAr4ards are eprofcsttaul. blnq sett oa a consistent basis. if ap�Plieable pretreataent standarts are aot being set on a eat:sistent basis. cetttfied statesrat should indicate the roll o.rtag: t. Hhether additional oPeratloo and m4fatenance (ot"tj ",or add,ttoaal Pretnat.ent Is rtgafred for applfcaAt to ftet Pretreatsmnt sttadards; $ad b• The shortest schedule by vhidt appifcant ri1T proride &Cditlonat Oar! or pretreatment. The ecmPletfor date in this schedele east aot be tater than Compliusce date tsttbltshed far applicable pretreatieat standard. Ali a Dle StandtrCs ' • Canstftaent Cleft t f 1 F xhibit C to Brookfield Wholesale Wastewater Servicc Agreement Page 34 9735.2 EXHIBIT 1 (CONT'D) 3. For new rignirlcsnt ina Mr-fal users descrtbt :ht pretrtateent processes propose4 for your faciifty to meet the requirtmtnts listed to Stem a, (Ecaaplrs: nevtral(satioa. materials recovery, yrtast yaps. sand trips, et:.) I the undtrsigned applicant. bong the authors:ed representative of the hetein ndaed =icopsny, do hereby request a pemit to cocLtnve to ate or to establish an Sndvstrfal saver conaect(oa at the lOLatiOn tndiuted humin and do agree to fly with proristons of City Drdinance Signitore of APPI tcant Date Mash of Signee east flat (Kam* and phnnc nuaber of person to coa,toct regarding terait Information. MPMATE ACXMLEDGNEKT THE STAT£ OF rum j CVJKTT OF j before ae. tht undersigned authority, on this day personally appeared of I corporatian, Lr-awn to me to be the person whose nage is subtertbed to the foregoing (astrment, and aCkAomledged to ne that he extcutea the same for purposrs and considerations thertin czpretsed, In the Capacity therein stlted Ind as the act and deed of said corporation. 6iren ,order m7 hand Ind seal or office on this Sar of 19 Notary Publit to and for Co4mty, Texas Fir CMnitsfon EAptresl I-:Xhibit C to Brook(icld Wholesale Wastewater Service Agreement Pagc 35 9735 2 Section 9. aTIER CONTRACTS. (a) The Authority reserves the right, with the approval of a majority vote of the Advisory Committ e, to enter into :ontracts to provide the Wastewater services of the System to Additional Contracting Parties under contracts similar to this Contract, subject to the requirements concerning "minimun " as hereinafter provided. Each contract with any Additional Contracting Party shall comply with the requirements of this Contract, shall substantially restate the essential provisions of this Contract, and shall be structured to be similar hereto to the fullest extent applicable and practicable, with such additions or changes as are necessary to meet the actual circumstances, with the effect that each Additional Contracting Party will substantially adopt the provisions of this Contract, as supplemented and necessarily changmd by its contract. However, the Authority shall not obligate itself to receive Wastewater into the system Iron any future Additional Contracting Party if, in the judgment and discretion of thQ Authority, such obligation would jeopardize the Authority's ability to meet its obligation to receive, transport, treat, and dispose of Wastewater discharged into the System by prior Contracting Parties, including specifically the Initial contracting Parties. (b) It is further recognized and agreed that in the future the Authority may provide services of the System to parties which are not Additional Contracting Parties, provided 25 Exhibit C to Brookfield Wholesale Wastewater Service Agreement Page 36 9735.2 that all such services of the System to parties which are not Additional Contracting ?arties shall in all respects be sub- ordinate to the prior rights of the Contracting Parties, and all contracts or other arrangements relating to such servicers shill recognize, and be made subordinate to, such prior rights. (c) Each Contracting Party shall have the right, with the approval of a majority vote of the Advisory Committee and the approval of the Authority, to negotiate and enter into subcon- tracts with any other city or other entity under which such other city or entity may discharge Wastewater generated within the drainage area of Denton Creek, but outside the boundaries Of such Contracting Party, into such Contracting Party's severs, to be transported into the System at such Contracting Party's Point or Points of Entry along with such Contracting Party's Wastewatmr generated within the drainage area of Denton Creek. In such case such additional Wastewater shall be regarded as being the Wastewater of such Contracting Party for all purposes of this Contract. The consideration as between or among such cities or other entities may be determined by such parties, but no such transaction shall relieve the Contracting Party of its obligations to the Authority under the terms of this Contract. Section 10. ' ADVISORY COMMITTEE. (a) The governing body Of each of tha Contracting Parties annually shall appoint one of the members of its governing body or one of its employees as 27 Exhibit C to Brookfield Wholesale Wastewater Service A-rcement Pagc 37 9735.2 s voting member of the Advisory committee :or the System, which Advisory Committaa is hereby creatad mad established. The Advisory Committ*&, at its first meeting, shall elect a Chairman, a vice Chairman, and a Secretary. The Advisory Co=i.ttae may establish bylaws governing the election of officers, meeting dates, and other matters pertinent to the f:ulctioning of the Advisory Coa7aittee. The Advisory Committee shall consult with and advise the Authority, through its General Manager or his designated representative, with regard to the following matters pertaining to the System: (i) The issuance of Bonds; (ii) The operation and naintanance of the System; (iii) Additional contracting Parties and the teras and conditions of the contracts with such parties, consistent with the provisions of this Contract; (iv) Contracts for services to entities which are not Additional Contracting Parties, and the prices, terms, and conditions of such contracts consistent with the provisions of this Contract; (v) The Authority's Annual Budget, prior to its submission by the Authority's General Manager to the Authority's Board; (vi) Review of the Authority's Annual Audit; (vii) All other pertinent ;natters relating to the management of the System; and 28 Exhibit C to Brookfield Wholesale Wastewater Service Agreement Page 38 9735 2 (viii) Improvements and extensions of the System. The Advisory Committee shall have access to and may inspect at any reasonable times all physical elements of the System and all records and accolants of the Authority pertaining to the System. A copy of the minutes of the meetings of the Advisory Committae and all other pertinent data, shall be provided to the members of the Advisory Committee. (b) The term of membarship on the Advisory Committee shall be at the pleasure of each governing body represented, respectively, and each member shall serve until replaced by such governing body. All expenses of the Advisory Committee in discharging its duties under this Section shall be considered as an operation and Maintenance Expense of the System. Section 11. FISCAL PROVISIONS. (a) Subject to the terms and provisions of this Contract, the Authority will provide and pay for the cost of the acquisition and construction o€ the System and all system facilities, by issuing its Bonds in amounts which will be sufficient to accomplish such purposes, and the Authority will own and operate the System. It is acknowledged and agreed that payments to be made under this Contract and similar contracts with Additional Contracting Parties, if any, will be the primary source available to the Authority to provide the Annual Requirement, and that, in compliance with the Authority's statutory duty to fix and from time to time revise the rates of compensation or charges -for 29 Fx1iiblt C to l3r-ooklicld Wholcsalc Wastewater Service A-rccmcnt Pagc 39 97.15.2 services of the Syst= randarad and made availaLble by the Authority, the Annual Requirement :rill change from time to tins, and that each such Annual R.aquirement shall be allocated —Ong the Contracting Parties as hard:.-ftar provided, and that tha Annual Requirement for each Annual Payment Period shall be provided for in each Annual Budget and shall at all times be not less than an amount sufficient to pay or provide for the payment of: (A) An "Operation and Maintenance Component" equal to the amount paid or payable for all operation and Nainta- nance Expenses of the System and the Wastewater Interceptor system. It is understood and agreed that although the Waztewater Interceptor System will not be a part of the System as defined in this Contract, it will consist of facilities which are ancillary to and integrated into the operation of the System, and therefore will be operated and maintained in effect as a part of the System under the provisions of this Contract, consistent with the tests of the Interceptor contract; and (B) A "Bond Service Component" equal to: (1) the principal of, redemption premium, if any, and interest on, its Bonds, as such principal, redemption premium, if any, and interest become due, less interest to be paid out of Bond proceeds or from other sources it permitted by 30 E.\hibit C to [Brookfield Wholesale Wastewater Service A-i-eement Page 40 9735.2 any Bond Resolution, and all amounts req*.iirad to redeem any Bonds prior to maturity when and as provided in any Bond Resolution, plus the expenses, and charges of aach Paying Agent/Registr&r for paying the principal of and interest on the Bonds, and for authenticating, registering, and transferring Bonds on the registration books; and (2) the proportionate amount of any special, contingency, or ra arva funds required to be accumulated and maintained by the provisions of any Bond Resolution; and (3) any amount in addition tharato sufficient to restore any deficiency in any of such funds required to be accumulated and maintained by the provisions of any Bond Resolution. Section 12. ANNUAL BUDGET. Each Annual Budget for the System shall always provide for amounts sufficient to pay the Annual Requirement. The Annual Budget for the System for all or any part of the Annual Payment Period during which the System is first placed into operation shall be prepared by the Authority based on estimates made by the Authority after, consultation with the Advisory Committee. On or before August 1 of each year after the System is first placed in operation, the Authority shall furnish to each Contracting Party a 31 Exhibit C to Brookfield Wholesale Wastewater Service Agreement Page 41 9735.2 praliminary estimate of the Annual Payment recfsired from each contracting Party for the next following Annual ?a-finent Period. 2tot less than forty days before the commencement of the Annual Payment Period after the System is first placed into operation, and not less than forty days befora the commencement of each Annual Payment Period thereafter, the Authority shall cause to be prepared as heroin provided its preliminary budget for the System for the next ensuing Annual Payment Period, which budget shall specifically include the - Operation and Maintenance Component and the Bond Service Component. A copy of such preliminary budget shall be filed with each contracting Party. The preliminary budget shall be subject to examination, at reasonable times during business hours, at the office of the City Secretary of' *each Contracting Party. If no protest or request for a hearing on such preliminary budget is presented to the Authority within ten days after such filing of the preliminary budget by one or more Contracting Parties or. by the ou-ners of a minimum of 25t in principal amount of the Bonds then outstanding, the preliminary budget for the System shall be considered for all purposes as the ".Annual Budget" for the next ensuing Annual Payment Period. But if protest or request for a hearing is duly filed, it shall be the duty of the Authority to fix the date and time for a hearing on the prelim- inary budget, and to give not less than ten days notice thereof to the Contracting Parties. An appropriate Committee of the 32 Fxliibit C to Brookfield Wlholcsalc Wastewater Service Agreement Page 42 9735 2 Authority shall consider the t.astimony and showings made in such hearing and shall report its ffn3irr3s to the Board of Directors of the Authority. The Boaxd of Directors may adopt the preliminary budget or make such amendments thereof as to it may seem proper. . The budget thus approved by the Board of Directors of the Authority shall be the Annual Budget for the next ensuing Annual. Payment Period. The Annual Budget (includ- ing the first Annual Budget) may be amended by the Authority at .any time to transfer from one division thereof to another funds which will not be needed by such division. The amount for any division, or the amount for any purpose, in the Annual Budget may be increased through formal action by the Board of Direc- tors of the Authority even though such action might cause the total amount of the Annual Budget to be exceed-ad; provided that such action shall be taken only in the event of an emergency or special circumstances which shall be clearly stated in a resolution at the time such action is taken by the Board of Directors. Certified copies of the amended Annual Budget and resolution shall be filed immediately by the Authority with each Contracting Party. Section 13. PAYMENTS BY CONTRACTING PARTIES. (a) For the Wastewater services to be provided to the Contracting Parties under this Contract, each of the Contracting Parties agrees to pay, at the time and in the manner hereinafter provided, its proportionate share of the Annual Requirement, 33 l":xhibit C to Brooklielci Wholesale Wastewater Service Agreement ha c 43 07.)5.2 which shall be determined as herein described and shall consti- tute a Contracting Party's Annuals Payment. Bach of the Con- tracting Parties shall pay its part of the Annual ?aguirement for each Annual Payment Period directly to the Authority, in monthly installments, on or before the lath day of each month, in accordance with the schedule of payments furnished by the Authority, as hereinafter provided. (b) For each Annual Payment Period each Contracting Party's proportionate share of the Annual Requirement shall be a percentage obtained by dividing the number of gallons of contributing flow of Wastewater estimated to be discharged into the systen by such Contracting Party during such Annual Payment Period, as determined by the Authority after consultation with such Contracting Party, by the aggregate total number of gallons of contributing flow of Wastewater estimated to be discharged into the System by all Contracting Parties during such period, as determined by the Authority after consultation with all of the Contracting Parties. It is provided, however, that in estimating costs for services the Authority is specifi- cally authorized, in its discretion, to estimate such costs based on an arbitrary assumption that the Annual Payment Period for which the calculation is being made will be an extremely dry year, rather than a normal or average year, and that accordingly the contributing flow of Wastewater discharged into the System will be less than expected normally or on an 34 Exhibit C to Brookfield Wholesale Wastewater Service Agreement Page 44 9735.2 average, all with the result that the monthly payments made by the Contracting Parties may be higher than would have bean required on the basis of a normal or average year, and with the further result that the total amount required to meet the than current Annual Budget for the System may be collected by the Authority before the and of the then current Annual Payment Period. This result is expressly approved by the Contracting Parties and is deemed by the parties hereto to be beneficial in the fiscal management of the System, and will assure the timely availability of funds even under unexpected circumstances. However, upon receipt during any Annual Payment Period of an amount sufficient to meet the then currant Annual Budget of the System for the remainder of the then current Annual Payment Period, the Authority immediately shall notify the Contracting Parties, and they shall not be obligated to make further payments under this Section for the remainder of that Annual Payment Period, unless othQrwisa specifically hereinafter provided in the event of une mlected or additional Annual Budget requirements. It is further provided that the Authority may revise its estimates of contributing flow either monthly or for any other period within an Annual Payment Period, as determined by the Authority, and such revised estimates may be made on the basis of actual metered contributing flow during the preceding month or other period, to the end that the Authority may use its best efforts to avoid to the extent practicable unnecessary 35 Lxhibit CIO Brookfield Wholesale Wastewater Service Agreement Page 45 9735 2 final adjustments among the Contracting Parties for each Annual Payment Period. All such payments for each Annual par-me nt Pariod shall be made in accordance with a :mitten schedule of payments for the appropriate Annual payment period which will be supplied to aach of the Contracting Parties by the Authority. Such schedule of payments may be revised by the Authority periodically based on any changes in its estimates of contributing flow as provided above, and each revised schedule of payments shall be supplied to each Contracting Party bafore the beginning of the period to which it is applicable. At the close of each Annual Payment Period the Authority shall determina the actual metered number of gallons of contributing flow of Wastewater discharged into the System by each Contracting Party during said period and determine each Contracting Party's actual percentage of the Annual Requirement by dividing such Contracting Party's actual metered contributing flow by the actual metered contributing flow of all Contracting Parties. Each Contracting Party's Adjusted Annual Payment shall be calculated by multiplying each such Contracting Party's redetermined percentage times the actual Annual Requirement. The difference between the amounts which actually have been paid by each Contracting Party and the amounts actually due from such Contracting Party hereunder shall be applied as a credit or a debit to such Contracting Party's account with the Authority and shall be credited or 36 L;.XIIINt C to Brookflcld Wholesale Wastewater Service Agreement Page 46 97352 debited to such Cont.racti.nrg Party's next monthly payment, or as otharvite agreed betwaan the Authority and the affected Con— tracting Party, provided that all such credits and debits shall be made in a timely manner not later than the and of the next following Annual Payment Period. (c) Notwithstanding the provisions of (b) , above, and as an exception thereto, it is agreed that if, during any Annual Payment Period, the estiaated and/or actual metered contribut- ing flow of Wastewater into the System of any Contracting Party Jr., for any reason whatsoever, less than the minimum amount hereinafter prescribed and provided for it, such contracting Party shall pay its share of each Annual Requirement as if its estimated and/or actual motored contributing flow of Wastewater into the System were such minimum amount. However, if such Contracting Party's estiaated and/or actual motored contribut- ing glow of Wastewater into the System is Equal to or in excess of such minimum amount, its share of all of each Annual Re- quirement shall be calculated on the basis of estimated and actual contributing flow as provided in (b) , above. All contracts with Additional Contracting Parties shall provide for equitable minimums similar to those provided for below. Such minimums shall be fixed in amounts at least sufficient, as determin4d by the Authority, to assure an initial annual payment by such Additional Contracting Party for not less than the amount of its estimated contributing flog of Wastewater 37 Exhibit C to Brookficld Wholesale Wastewater Service Agreement Page 47 9735 2 {.nto the System dT_ring the first year of service under such contract. For the purpose of calculating the minimum per- csntaga of each Annual Requirement :or which each In{tial Contracting Party is unconditionally liable, without offset or counterclaim (also sea section 16 hereof) , the contributing flow of Wastewater into the System of each Initial Contracting party, during each Annual Payment Period, shall be deemed to he not less than the minimum amount (regardless of whether or not such amount was actually discharged into the System) specified for such Initial Contracting Party as follows: City of Fort Worth: 43,158, 695 gallons City of Haslet: 22,OB2,500 gallons City of Roanoke: 40,150,000 gallons. (d) Notwithstanding the foregoing, the Annual Require- ment, and each Contracting Party's share thereof, shall be redetermined, after consultation with each of the Contracting Parties, at any tine during any Annual Payment Period, to the extent deemed necessary or advisable by the Authority, if: (i) The Authority commences furnishing services of the System to an Additional Contracting Party or Parties; (ii) Unusual, extraordinary, or unexpected expenditures for operation and Maintenance Expenses are required which are not provided for in the Authority's Annual Budget for the System or in any Bond Resolution; (iii) Operation and Maintenance Expenses are substantially 3B Exhibit C to [3rooklield Wholesale Wastewater Servicc Agreement Page 48 ,Ms 2 lass than estiaated; (iv) The Authority issues Bonds whic:i require an increase in the Bond services Component of the Annual Payment; or (v) The Authority receives either significantly sora or significantly less revenues or other amounts than those anticipated. (e) During each Annual Payment Period all revenues received by the Authority from providing services of the System to parties which are not Contracting Parties, and all sur- charges collected from any Contracting Party under Section 4, above, shall (i) first be credited to the operation and Mainte- nance Component of the Annual Requirement, and (ii) then any remainder credited to the Bond Service Component of the Annual Requirement, with the result that such credits under (i) and respectively, shall reduce, to the extent of such credits, the amounts of such Components, respectively, which otherwise would be payable by the Contracting Parties pursuant to the method prescribed in (b) and (c) , above. The Authority may estimate all such credits which it expects to ;sake during each Annual Payment Period in calculating each Annual Payment. (f) Each Contracting Party hereby agrees that it will make payments to the Authority required by this Section on or before the 10th day of each month of each Annual Payment Period. If any contracting Party at any time disputes the 39 f:\hibit C to Brookfield Wholesalc Wastewater Service Agreement Parc 49 9735 2 amount to be paid by it to the Authority, such complaining party shall nevertheless promptly make such payment or pay- ments, but if it is subsequently deternined by agreement or court decision that such disputed payments made by such com- plaining party should have been less, or more, the Authority sha11 promptly revise and reallocate the charges among all contracting Parties in such manner that such complaining party will recover its overpayment or the Authority will recover the amount due it. A11 amounts due and owing to the Authority by each contracting Party or due and owing to any Contracting Party by the Authority shall, if not paid when due, bear interest at the rate of ten (10) percent per annum from the date whQn due until paid. The Authority shall, to the extant permitted by law, discontinue the services of the System to any Contracting Party which remains delinquent in any payments 'due hereunder for a period of sixty days, and shall not resume such services while such Contracting Party is so delinquent. It is further provided and agreed that if any Contracting Party should remain delinquent in any payments due hereunder for a period of one hundred twenty days, and if such delinquency continues during any period thereafter, such Contracting Party's minimum amount of gallons of Wastewater specified and described in (c) , above, shall be deemed to have been zero gallons during all periods of such delinquency, for the purpose of calculating and redetermining the percentage of each Annual 40 Fxhibit C to Brookfield Wholesale Wastewater Service Agreement Page Sp 97352 Payment to be paid by the non-delinquent Contracting ?antics, and the Authority shall redetermine such percentage on ,that basis in such event so that the non-delinquent Contracting Parties collectively shall be required to pay all of the Annual Requirement. However, the Authority shall pursue all legal remedies against any such delinquent Contracting Party to enforce and protect the rights of the Authority, the other Contracting Parties, and the holders of the Bonds, and such delinquent Contracting Party shall not be relieved of the liability to the Authority for the payment of all amounts which would have been due hereunder, in the absence of the next preceding sentence. It is understood that the foregoing provisions are for the benefit of the holders of the Bonds so as to insure that all of the Annual Requirement will be paid by the non-delinquent Contracting Parties during each Annual Payment Period regardless of the delinquency of a Contracting Party. If any amount due and owing by any Contracting Party to the Authority is placed with an attorney for collection, such Contracting Party shall pay to the Authority all attorneys fees, in addition to all other payments provided for herein, including interest. (g) If, during any Annual Payment Period, any Contracting Partys Annual Payment is redetermined in any manner as pro- vided or required in this Section, the Authority will promptly 41 Exhibit C to Brookfield Wholesale Wastewater Service Agreement Pagc 51 9735.2 furnish such Contracting parry with an updated schedule of monthly payments reflecting such redetermination. SeLtion 14. SPECIAL r''-. o%rlSIo2:S. (a) The Aut-hority will continuously operate and naintain the System in an efficient manner and in accordance with good businass and engineering Practices, and at reasonable cost and expense. (b) The Authority agrees to carry fire, casualty, public liability, and other insurance (including self-insurance to `..he extent deemed advisable by the Authority) on the -Systea for purposes and in amounts which ordinarily would b$ carried by a privately owned utility company. owning and operating such facilities, except that the Authority shall not be required to carry liability insurance except to insure itself against risk of loss due to claims for which it can, in the opinion of the Authority's legal counsel, be liable under the Texas Tort Claims Act or any similar law or judicial decision. Such insurance will provide, to the extent feasible and practicable, for the restoration of damaged or destroyed properties and equipment, to minimizes the interruption of the services of such facilities. All pre=!,,---, for such insurance shall constitute an operation and Maintenance Expense of the System. (c) It is the intent of the parties that the System will be placed in operation in 1989, and the Authority agrees to proceed diligently with the design and construction of the System to meet such schedule, subject to the other terms and 42 Exhibit C to Brookfield Wholesale Wastewater Service A-reemem Page 52 97.35.2 conditions in this contract. it is expressly understood and agreed, 3owevar, that any obligations on the part of the Authority to acquire, construct, and complete the system and to provide the services of the Systen to the Contracting Parties shall be conditioned (i) upon the Authority's ability to obtain all necessary permits, material, labor, and equipment, (ii) upon the ability of the Authority to finance the cost of the Systen through the actual sale of the Authority's Bonds, and (iii) .subject to all present and future valid laws, orders, rules, and regulations of the United States of America, the State of Texas, and any regulatory body having jurisdiction. (d) The Authority shall never have the right to demand payment by any Initial Contracting Party of any obligations assumed by it or imposed on it under and by virtue or: this Contract from funds raised or to be raised by taxes, and the obligations under this Contract shall never be construed to be a debt of such kind as to require any of the initial contract— ing Parties to levy and collect a tax to discharge such obli- gation. (e) Each of tha Initial Contracting Parties, respect- ively, repra.sants and covenants that all payments to be made by it under this Contract shall constitute reasonable and neces- sary "op$rating expenses" of its combined waterworks and sewer system, as defined in Vernon's Ann. Tex, Civ. St. Article 1113, and that all such payments will be made from the revenues of 43 Exhibit C to Brookfield Wholesale Wastewater Service Agreement Page 53 9735.2 its. combined wa_erkorks and sewer system. Bach of the Con- tractinq Parties, respertively, represents and has determined that tha services to be provided by the Systea, are necessary and essential to the present and future operation of its aforesaid system, and that the System constitutes the only available and adequate method for discharging, receiving, treating, and disposing of its wastewater from the Denton Creek drainage area, and, accordingly, all payments required by this Contract to be made by each Contracting Party shall constitute reasonable and necessary operating expanses of its systems, respectively, as described above, with the effect that the obligation to make such payments from revanuss of such systems, respectively, shall have priority over any obligation to make any paynents from such revenues of principal, interest, or otherwise, with respect to all bonds or other obligations heretofore or hereafter issued by such Contracting Party. (f) Each of the Contracting Parties agrees throughout the team of this Contract to continuously operate and maintain its combined waterworks and sewer system, and to fix and collect such rates and charges for water and sewer services and/or sewer services to be supplied by its system as aforesaid as will produce revenues in an amount equal to at least (i) all of the expenses of operation and maintenance expenses of such system, including specifically its payments under this Con- tract, and (ii) all other amounts as required by law and the 44 E,Xhibit C to [Brookfield Wholesale Wastewater Service Agrecmem I'agc 54 9735.2 Provisions of the ordinances or resolutions authorizing its r*v&nue bonds or other obligations now or hereafter outstmnd- ing, including the amoi:nts required to pay all principal of and interest on such bonds and other obligations. (g) Me Authority covenants and agrees that neither the proceeds from the sale of the Bonds, nor the moneys paid to it Pursuant to this Contract, nor any earnings from the investment of any of the foregoing, will be used for aziy purposes except those directly relating to the Systen, the Wastewater Interceptor System, and the Bonds as provided in this Contract; provided that the Authority may rebate any excess arbitrage earnings fro= such investment earnings to the United States of America in order to prevent any Bonds from beconfng "arbitrage bonds" within the meaning of the IRS Code of 1986 or any amendments theereto in effect on the date of issue of such Bonds: Each of the Contracting Parties covenants and agrees that it wil not use or permit the use of the system in any manner that would cause the interest on any of the Bonds to be or become subject to federal income taxation under the IRs Code of 1986 or any amendments thereto in effect on the date of issue of such Bonds. Section 15. FORCE MAJEURE. If by reason of force majeure any party hereto shall be rendered unable wholly or in part to carry out its obligations under this Contract, other than the obligation of each Contracting Party to make the payments 45 [:xhibit C to Brookfield Wholesale Wastewater Servicc A-reement Pave 55 9736 2 raquirad under Section 13 of this Contract, then it such party shall give notice and full pa..rticulars of such farce majeurs in writing to the ath&r parties within a reasonable time after occurrance of the event or cause relied On, the obligation of the party giving such notice, so far as it is affected by such force majeure, shall be suspended during the continuance of the inability than claimed, but for no longer period, and any such Party shall endeavor to remove or overcome such inability with all reasonable dispatch. The term "Force Majeure" as employed herein shall moan acts of Cod, strikes, lockouts, or other industrial disturbances, acts of public enemy, orders of any kind of the Government of the United States or the State of Texas, or any civil or military authority, insurrection, riots, epidemics, landslides, lightning, earthquake, fires, hurri- canes, storms, floods, washouts, droughts, arrests, restraint of government and people, civil disturbances, explosions, breakage or accidents to machinery, pipelines or canals, partial or entire failure of water supply, or on account of any other causes not reasonably within the control of the party claiming such inability. Section 16. UNCONDITIONAL, OBLIGATION TO MAKE PAYMENTS. Recognizing the fact that the Contracting Parties urgently require the facilities and services of the System, and that such facilities and services are essential and necessary for actual use and for standby .purposes, and recognizing the fact 46 Exhibit C to Brookfield Wholesale Wastewater Service Agreement Page 56 97.35.2 i s 3 that the Authority will use payments received from t_he con- tracting Parties to pay and secure its Bonds, it is hereby agreed that each of the Contracting parties shall be =con- ditionally obligated to pay, without offset or counterclaim, its proportionate share of the Annual Reguiremant, as provided and determined by this Contract (including the obligations for paying for "minimums" as described in Section 13 hereof) , regardless of whether or not the Authority actually aca_uiras, constructs, or completes the System or is actually operating or providing servicers of the System to any Contracting .Party hereunder, or whether or not any Contracting Party actually uses the services of the System whether due to Force Majeure or any other reason whatsoever, regardless of any other provisions Of this or any other contract or agreement between any of the parties hereto. This covenant by the Contracting Parties shall be for the benefit of and enforceable by the holders of the Bonds and/or the Authority. Section 17. TERM OF CONTRACT; MODIFICATION; NOTICES; STATE OR FSDZRAL LAWS, RULES, ORDERS, OR REGULATIONS. (a) This Contract shall be effective on and from the Contract Date, subject to its execution by all of the Initial Contracting Parties and the Authority, and this Contract shall continue in force and effect until the principal of and interest on all Bonds shall have been paid, and thereafter shall continue in force and effect during the entire useful life of the System. 47 Exhibit C to Brookfield Wholesale Wastewater Service n<>reement Page 57 9735.2 'i2iis Contract constitu:e_3 the sole agrscme:Zt between th-a parties hereto with respect to the System. (b) Modification. No cha_-Ige, amandmant, or modification of this Contract shall be made or be effective which will affect adversely the prompt payment when due o� all moneys required to be paid by each Contracting party under the terms of this contract and no such change, amendment, or modification shall be made or be effective which would muse a violation of any provisions of any Bond Resolution. (c) Addresses and Noti q. Unless otherwise provided herein, any notice, communication, request, reply, or advice (herein severally and collectively, for convenience, called "Notice") herein provided or permitted to be given,' made, or accepted by any party to any other party must be in writing and may be given or be served by depositing the same in the United States mail postpaid and registered or certified and addressed to the party to be notified, with return receipt requested, or by delivering the same to an officer of such party, or by prepaid talegram when appropriate, addrersed to the party to be notified. Notice deposited in the mail in the mannQr herein- above described shall be conclusively deemed to be effective, unless otherwise stated herein, from and after the, expiration of three days after it is so deposited. Notice given in any other manner shall be effective only if and When received by the party to be notified. For the purposes of notice, the 48 (:xhibit C to [Brookfield Wholesale Wastewater Service Agreement Page 58 9735 2 addrasses of the parties shall, u.-ztil changed as hereinafter provided, be as follows: if to the Authority, to: Trinity River Authority of Texas 5300 S. Collins P. O. Box 240 Arlington, Texas 76010 If to the Initial Contracting Parties, as follows: City of Fort Worth 1000 Throc)naorton Fort Worth, Taxas 76102 City of Haslet P. 0. Box 8 Hazlet, Texas 76052 City of Roanoke P. O. Box 366 Roanoke, Texas 76262 The parties hereto shall have the right from time to time and at any time to change their respective addresses and each shall have the right to specify as its address any other address by at least fifteen (15) days, written notice to the other parties hereto. (d) State or Federal Laws Rules Orde4 s Regulations, This Contract is subject to all applicable Federal and State laws and any applicable permits, ordinances, rules, orders, and regulations of any local, state, or federal governmental authority having or asserting jurisdiction, but nothing con- tained herein shall be construed as a waiver of any right to question or contest any such law, ordinance, order, rule, or regulation in any forum having jurisdiction. 49 Exhibit C to Brookfield Wholesale Wastewater Service Agreement Page 59 9735.2 Section 13. St,v"�-R.�3zLITY. The parties haroto specifical- ly agree that in ca50 amy one or more of the sections, cubsec- tiona, provisions, clauses, or words of this Contract or the application o: sue3 sections, subsections, provisions, clauses, or words to any situation or circuastatice should be, or should be held to be, for any reason, invalid or unc=%stitutional, under the laws or constitutions of the State of Texas or the United States of America, or in. contravention of any such laws _ate constitutions, such invalidity, unconstitutionalfty,_ or contravention shall not affect any other sections, subsections, provisions, clauses, or words of this Contract or the applica- tion of such sections, subsections, provisions, clauses, or words to- any other situation or circumstance, and it is in- tended that this Contract shall be severable and shall be construed and applied as if any such invalid or unconstitu- tional section, subsection, provision, clause, or word had not been included herein, and the rights and obligations of the parties hereto shall be construed and remain in force accord- ingly. Section 19. REMEDIES UPON DEFAULT. It is not intended hereby to specify (and this Contract shall not be considered as specifying) an exclusive remedy for any default, but all such other renedies (other than termination) existing at law or in equity may be availed of by any party hereto and shall be cumulative. Recognizing however, that the Authority.'s 50 I'xhibit C to Brookfield Wholesale Wastewater Service Agreement Page 60 97.35.2 undertaking to provide azid maintain the service= of the System is an obligation, failure in the performance of vhich cannot be adequately compensated in money da=nger. alone, the Authority agrees, in the event of any default on its part, that sach Contracting ?arty shall have available to it the equitable remedy of mandamus a-A specific parforma.-ice in addition to a.-iy Other legal or equitable remedies (other than termination) which may also be available. Recognizing that failure in the performance of any Contracting Party's obligations hereunder could not be adequately compensated in money damages alone, each Contracting party agrees in the avant of any default on its part that the Authority shall have available to it the equitable remedy of mandamus and specific performance in addition to any other legal or equitable remedies (other than termination) which may also be available to the Authority. Notwithstanding anything to the contrary contained in this contract, any right or remedy or any default hereunder, except the right of the Authority to roceive the Annual payment which shall never be determined to be waived, shall be deemed to be conclusively waived unless asserted by a proper proceeding at law or in equity within two (2) years plus' ane (1) day after the occurrence of such default. No waiver or waivers of any breach or default (or any breaches or defaults) by any party hereto or of performance by any other party of any duty or Obligation hereunder shall be deemed a waiver thereof in the 51 Exhibit C to Brookficid Wholesale Wastewater Service A()recmem Pagc 61 9735.2 future, nor shall any such waivar or Waivers be deemed or ,..ozstr'jed to be a W:aivar of subsequent breaches or defaults of a--'Y kirld, character, or description, under anv circ-=stances. Section 20. VMMR' Alt amounts due under ,this Contract, including, but not l.iveitcd to, Payments due under this Contract or damages for the breach of this Contract, shall be: paid and be due in Tarrant County, Texas, which is the County in which the principal administrative offices of the Authority are located. It is specifically agreed among the parties to this Contract that Tarrant cou0ty, Texas, is the place of perfor- mance of this Contract; and in the event that any legal pro- ceeding is brought to enforce this Contract or any provision hereof, the same shall be brought' in Tarrant County, Texas, IN WITNESS WEZREOF, the parties hereto acting under authority of their respective governing bodies have caused this Contract to be duly executed in several counterparts, each of Which shall constitute an original, all as of the day and year first above written, which is the date of this Contract. T��TY A TY OF TEXAS BY Gene Manager ATTEST: � y 4e . erry, Soard o£ Directors (AUTHORITY SEAL) 52 Gxhibit C to Brookfield Wholesale Wastewater Service Agreement Pa(,e 62 9735.2 CITY OF FOc'2T WORT3, TEXAS BY , ATTEST: City Secratary (CITY SEAL) APPROVED AS TO FORM AND LEGALITY City Attorney, city of Fort worth, Gantrsct AutbDZjzatj= Texas CITY OF B:ASLET,• TEXAS BY Mayor ATTEST: City secratary (CITY SEAL) CITY OF ROANOKE, TEXAS BY ATTEST: City Secrfetary (CITY SEAL) 53 Exhibit C to Brookficld Wholesale Wastewater Service Agreement Page 63 9735.2 Exhibit D Points of Entry r I Exhibit D to `Wholcxslc W;L'ctc'K'XL-Service Azr=mcnt page; F'Xhibit C to Brookfield Wholesale Wastewater Service Agreement Page 64 9735.2 Exhibit D Map showing the Development's Point of Entry into the Fort Worth System and Fort Worth's Point of Entry to the TRA System i � t Q2S 1 ! i ! ' j >>r 3 1 u`t 72.2 10 r ,� F71 �, W R f:Xhl�ll �� to Brookfield Wholesale Wastewater Service Agreement Page I 9735.2 Exhibit E Rate Methodology 1. Wholesale wastewater 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 Director from a list of five qualified firms submitted to the Director by the Fort Worth "Wastewater Advisory Committee." The cost of such studies will be a System Cost. All cost of service studies shall be conducted utilizing the utility cost basis of determining revenue requirements applicable to the wholesale customer class. 2. Every three (3) years, a detailed wholesale revenue requirement shall be developed on an actual historical cost test year basis allowing for reasonable and necessary expenses of providing such wastewater service and allowing for known and measurable adjustments. Such adjustments should allow for year end trending and the spreading of.,non recurring expenses over an appropriate benefit period. The test year for the initial rate set forth in Section 4.02 is October 1, 2003, through September 30, 2004, and the next detailed cost of service study shall be perfonned by an independent utility rate consultant during the first two (2) calendar quarters of 2007, based on audited data for the immediate past fiscal year ended September 30, 2006. On a three (3) year cycle thereafter, a complete detailed rate study will be performed with the same methodology used in the previous rate study by an independent utility rate consultant, subject to modifications recommended by a majority of the Wastewater Advisory Committee and approved by the Fort Worth City Council. In the interim period between complete detailed rate studies, wholesale wastewater rates shall be adjusted by Fort Worth using the same methodology adopted at the time of the last complete detailed rate study, utilizing the actual operating data for the twelve month period ending September 30th of the prior year, adjusted for known and measurable changes in cost data which may have occurred since the last audited statement. 3. 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, wastewater quality, metering, and customer related costs such as accounting, billing, and monitoring. Capital related costs will consist of depreciation expense and return on original cost rate base. On a periodic basis as determined by the Director the depreciation rates on all General Benefit Capital Facilities shall be studied, and new salvage values, useful lives, and annual rates of depreciation shall be developed from such studies. The rate base shall consist of all allocated capital facilities, net of depreciation and appropriate 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. On a periodic basis as determined by the Director, a cash "lead lag" study shall be conducted to determine the appropriate level of working capital at the same time as the above depreciation rate study is done. Records of the original cost and the accumulated depreciation of' all capital facilities shall be Exhibit E to Brookfield wholesale wastewater Service Aureement Page 1 9735.2 maintained in the Fort Worth Fixed Asset Tracking System. These records shall be available for inspection at the Fort Worth Water Department during reasonable business hours upon request by Aqua Utilities. 4. The City shall be allowed an adequate opportunity to earn a reasonable rate of return, sufficient to assure confidence in the financial soundness of the utility, adequate to maintain and support its credit, enable it to raise the money necessary for the proper discharge of its public duties. The rate of return is equal to the weighted average imbedded cost of outstanding debt plus one and one half percent (1-1/2%). 5. The rates set forth in Article 4.02 shall be automatically adjusted to equal those adopted by the City Council based on the foregoing rate studies, and shall become effective on the effective date established by the City for those rates. Exhibit F. to Brookfield Wholesale Wastewater Service Agreement Page 2 9735.2 W Lam' w W � � a> 0 0 s. N 3 v 3 y y b � a, 'L Q b y � � Z v W Cq � JNi'S]IbiJp)Sb w Np)tl—V I—— 15 (Illi IMOOtl9 II I > B I i � � s v+ z W / `\ awrxavn Q LU f W e AA Gael � I � A A IOM t9 i ��~ Q�� F O O s 3 Fzsa ��yW� o�� �� = Z ' v� I 3� 0 � W I I O� I _pH wwvi �= zp w ��\♦ Ya2Z O� C> _ z y Q 2V o o d d l7 z z z E1.1 ;H '.'I ' '^oaYYL�mz �,o� z�J g==o�� 3a �< al I 0z to y �'o � o Zi 4/ y a wz3o mpz z xY z a ?I aI O �0��v0�0 y0w zS OM tyw ty _ O Q , Y ry34 C `I v z a Q = J 4 n �I 80 oul'selelaossy g uosiapuy Aopmop 7a>jegp Wd SZ BE E OLOZ/LL/L L (llv)z L L lllfl i131Sb"W'BmP 1101HX3-lllfl-SSOSE LSO\fi�^P\SELSO\OQl sloaladFX Exhibit G ASSIGNMENT AND ASSUMPTION AGREEMENT THIS ASSIGNMENT AND ASSUMPTION AGREEMENT ("Assignment") is made and entered into as of the day of between a ("Assignor"), and (Assignor and Assignee are hereinafter sometimes collectively referred to as the `(Parties" and singularly as a"Party"). RECITALS: A. Assignor is the owner of the rights of the Owner under that certain `Brookfield Water and Wastewater Utility Service Agreement" (City Secretary Contract No. , M&C - ) (the "Agreement") effective as of , among Brookfield Acquisitions, L.P. as "Owner", the City of Fort Worth, Texas as the "City", and the South Denton County Water Control and Improvement District No. 1 as the "District", relating to the providing of water and wastewater utility service to the 231.579-acre Brookfield Development in Denton County, Texas (the "Development"), to the extent that the Agreement covers, affects, and relates to the lands described on Exhibit A attached to and made a part hereof of this Assignment for all purposes (the "Transferred Premises"). B. Assignor desires to assign certain of its rights and obligations under the Agreement as it relates to the Transferred Premises to Assignee, and Assignee desires to acquire such rights and obligations, on and subject to the terms and conditions of this Assignment. NOW, THEREFORE, in consideration of the premises, the mutual covenants and obligations set forth herein, and other good and valuable consideration, the receipt and legal sufficiency of which are hereby acknowledged, the Parties hereby agree and act as follows: 1. Certain Defined Terms. Unless indicated otherwise herein, capitalized terms in this Assignment shall have the same respective meanings as are ascribed to them in the Agreement. 2. Assignment. Subject to all of the terms and conditions of this Assignment, Assignor hereby assigns all [or describe specifically assigned rights if partial] of its rights under the Agreement, insofar as the Agreement covers, affects, and relates to the Transferred Premises. 3. Assumption. Assignee hereby assumes all obligations of Assignor and any liability that may result from acts or omissions by Assignee under the Agreement as it relates to the Transferred Premises that may arise or accrue from and after the effective date of this Assignment, and Assignor is hereby released from all such obligations and liabilities from and after the effective date of this Assignment. provided, however this Assignment does not release Exhibit a to Brookfield Water and Wastewater Utility service Agreement Page Assignor from any liability that resulted from an act or omission by Assignor that occurred prior to the effective date of this Assignment unless the City approves the release in writing. 4. Governing Law. THIS ASSIGNMENT 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. 5. Counterpart/Facsimife Execution. This Assignment has been prepared in multiple counterparts, each of which shall constitute an original hereof, and the execution of any one of such counterparts by any signatory shall have the same force and effect and shall be binding upon such signatory to the same extent as if the same counterpart were executed by all of the signatories. Facsimile copies of signatures may be appended hereto with the same force and effect as legally delivered original signatures. 6. Notice to City. A copy of this Assignment shall be provided to the City within fifteen (15) days after execution. 7. Binding Effect. This Assignment shall be binding upon and shall inure to the benefit of Assignor and Assignees and their respective heirs, personal representatives, successors, and assigns. EXECUTED as of the day and year first above written. ASSIGNOR: By: Printed Name: Title: ASSIGNEE: � 1 By: Printed Name: Title: 1`.0init G to Brookfield Water and Wastewater Utility Service Agreement Page STATE OF TEXAS § COUNTY OF § SWORN TO AND SUBSCRIBED before me on the day of 2005, by Notary Public, State of Texas STATE OF TEXAS § COUNTY OF § SWORN TO AND SUBSCRIBED before me on the day of 2005, by Notary Public, State of Texas [Add Acknowledgments] I.xhibit G to Brookfield Water and Wastewater Utility Service Agreement Page EXHIBIT "A" The Transferred Premises Exhibit H to Brookfield Water and Wastewater Utility Service Agreement Page M&C Review Page 1 of 2 Official site of the City of Fort Worth,Texas CITY COUNCIL AGENDA FORT WORTH COUNCIL ACTION: Approved on 1/25/2011 DATE: 1/25/2011 REFERENCE NO.: C-24720 LOG NAME: 60BROOKFIELD CODE: C TYPE: NOW PUBLIC CONSENT HEARING: NO SUBJECT: Authorize the Execution of the Strategic Partnership Agreement, Development Agreement, Agreement Concerning Operation of South Denton County Water Control and Improvement District No. 1 and Agreements Concerning Water and Wastewater Utility Service for the Brookfield Development Located Contiguous to State Highway 114 in the Extraterritorial Jurisdiction of the City of Fort Worth RECOMMENDATION: It is recommended that the City Council authorize the City Manager or a designee to execute the following agreements: 1. Strategic Partnership Agreement between the City and South Denton County Water Control and Improvement District No. 1; 2. Development Agreement between the City and Brookfield Acquisitions, L.P.; 3. Agreement Concerning Operation of the District between the City and the South Denton County Water Control and Improvement District No. 1 4. Water and Wastewater Utility Service Agreement between the City, South Denton County Water Control and Improvement District No. 1, Brookfield Acquisition L.P., and Aqua Utilities, Inc.; 5. Wholesale Water Service Agreement between the City and Aqua Utilities, Inc.; 6. Buy-Out Option Contract between the City, Aqua Utilities, Inc., Brookfield Acquisition L.P., South Denton County Water Control and Improvement District No. 1 7. Wholesale Wastewater Service Agreement between the City and Aqua Utilities, Inc. DISCUSSION: Brookfield owns and intends to develop approximately 231 acres in Fort Worth's extraterritorial jurisdiction as a mixed use development (the Development). The property fronts on State Highway 114 and is in Aqua Utilities, Inc.'s, water certificate of convenience and necessity (CCN). The property is in South Denton County Water Control and Improvement District (District) created by order of the Texas Commission on Environmental Quality dated April 19, 2007. The City Council consented to creation of the District by adoption of Resolution No.3157-01-2005 on January 4, 2005. The District and Brookfield have requested the City to consent to the issuance of bonds by the District to fund roads to serve the Development and have asked the City to provide water service to the Development in order to provide fire protection for residents. As consideration for approval of the documents listed above, Brookfield will extend 4.3 miles of 24-inch and 30-inch off-site water mains and 4.7 miles of 24 inch off-site sewer mains to connect the Development to the City's water and wastewater systems. The facilities will be constructed to City standards and will be over-sized at http://apps.cfwnet.org/council_packet/mc_review.asp?ID=14623&councildate=1/25/2011 8/12/2011 M&C Review Page 2 of 2 Brookfield's expense, to serve other proposed developments in the area, subject to reimbursement pursuant to City policies. The Development will also be subject to City land use and development regulations. The documents, which are available for public inspection and copying in the City Secretary's Office, can be summarized as follows: The Strategic Partnership Agreement authorizes the City to annex property within the Development designated for retail development for the limited purpose of imposing sales and use tax. The agreement provides that the City and the District will divide the sales tax proceeds equally for the first 19 years. The City's share will increase to 75 percent commencing in year 20. The Development Agreement provides for the enforcement of municipal building codes and establishes land use and development regulations for the Development. The Agreement Concerning Operation of the District establishes conditions for operation of the District, including conditions on issuance of bonds and requirements to provide information concerning the District to the City. The four remaining agreements identified as items 4 through 7 above relate to utility service for the Development. Aqua Utilities, Inc., (Aqua Utilities) will provide the retail water and wastewater service to customers within the Development. Aqua Utilities will provide wholesale water and wastewater agreement for the first 190 residences constructed in the Development. Commencing with the 191 st residence constructed, the City will sell treated water service and wastewater service to Aqua Utilities on a wholesale basis. The City has the option to purchase the water and wastewater facilities in the Development from Aqua Utilities for$10, and to obtain the CCN for the Development and become the retail water and wastewater provider for the Development at any time after 17 years after the Development is connected to Fort Worth's water system. The Infrastructure and Transportation Committee received a presentation concerning the Development on October 12, 2010 and recommended approval of the documents. FISCAL INFORMATION/CERTIFICATION: The Financial Management Services Director certifies that this action will have no material effect on City funds. TO Fund/Account/Centers FROM Fund/Account/Centers Submitted for City Manager's Office by: Fernando Costa (6122) Originating Department Head: S. Frank Crumb (8207) Additional Information Contact_ Paul Bounds (8567) ATTACHMENTS 60Brookfield WCID-FWSD_ ITC 10-7-2010,-ppt ittp://apps.cfwnet.org/council Packet/mc