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HomeMy WebLinkAbout1997-178C \D0CS\0RD\ENSERCH ORD ORDINANCE NO q I " / '1O AN ORDINANCE OF THE CITY OF DENTON, TEXAS AUTHORIZING THE CITY MANAGER TO EXECUTE TWO AMENDMENT OF LEASE AGREEMENTS RESPECTING REAL PROPERTY, BETWEEN THE CITY OF DENTON AND ENSERCH CORPORATION, PROVIDING FOR THE DRILLING OF NATURAL GAS STORAGE WELLS INCIDENT TO THE LAKE DALLAS GAS STORAGE FACILITY, AND FOR A CHANGE OF RENTAL TERMS, AND PROVIDING FOR AN EFFECTIVE DATE WHEREAS, the City of Denton has recently acquired certain real property situated in the Gideon Walker Survey, Abstract 1330, in Denton County, Texas, and WHEREAS, the City acquired said real property subject to, among other things, two certain leases entered into by the City's predecessors in title, Lotta E Callahan and husband Felix W Callahan, as lessors and Lone Star Gas Company as lessee, which leases were executed on November 7, 1966 One lease, identified as "LS-T-SL #1766, provided for the lease to Lone Star Gas of a certain 6 89 acre tract of land upon which the Lone Star Gas Plant is currently situated, which lease was recorded at Volume 545, page 35 of the Deed Records of Denton County, Texas, the second lease, identified as "LS-T-SL #1767, provided for the lease, to Lone Star Gas of several two (2) acre tracts of land, for well sites for normal operations of injecting and withdrawing gas and other substances from the subsurface formations under said real property, which two acre tracts are situated near the 6 89 acre tract, which second lease was recorded at Volume 545, page 31 of the Deed Records of Denton County, Texas, and WHEREAS, the City is the present owner of the lessor's interest in the two leases referred to hereinabove, and is the owner of the underlying fee simple and reversionary interests in the tracts of land which are the subjects of the two leases, and WHEREAS, the City and ENSERCH Corporation (formerly known as Lone Star Gas Company) desire to amend the two above -referenced leases to provide for the drilling of additional natural gas storage wells for ENSERCH Corporation's natural gas storage project known as the Lake Dallas Gas Storage Facility, on the tracts of land Covered by the two leases, to amend the two leases to provide for an increase of rental amount, to change the time of payment of rental to the City, and to change lessee's address, and WHEREAS, ENSERCH Corporation, due to the extensive growth of the Denton area, believes that it is necessary to drill a further gas storage well or wells on the tracts described in the two leases hereinabove, to help meet the demands of its customers for natural gas for the coming winter season, and WHEREAS, the amendment of the two hereinabove-described lease agreements is in the best interest of the City of Denton, NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS SSECTION I. That the City Manager is hereby authorized to execute Amendment Of Lease [LS-T-SL #17671 and Amendment Of Lease [LS-T-SL #17661 by and between the City of Denton as Lessor, and ENSERCH Corporation, as Lessee, respecting the approximate 12 89 acres of real property described in the two said amendment of lease documents, copies of both amendment documents are attached hereto and incorporated by reference herein SECTION II That the City Manager is hereby authorized to execute Memorandum Of Lease [LS-T-SL #17671 and Memorandum Of Lease [LS-T-SL #1766) respecting and summarizing the two Amendment of Lease documents described in Section I hereof, copies of both Memorandum Of Lease documents are attached hereto and incorporated by reference herein SSECTION III That this ordinance shall become effective immediately upon its passage and approval PASSED AND APPROVED this the L day of _, 1997 JACIf MILLER, MAYOR ATTEST JENNIFER WALTERS, CITY SECRETARY BYQcyc� \w APPROVED AS TO LEGAL FORM HERBERT L PROUTY, CITY ATTORNEY BY LS-T-SL #1766 AMENDMENT OF LEASE This Amendment of Lease (the "Amendment") is entered into this f 1 day of JAAt 1997, by and between City of Denton, Texas, (hereinafter sometimes referred to as the "Lessor"), whose address is 215 East McKinney, Denton, Texas 76201, and ENSERCH Corporation (hereinafter sometimes referred to as "Lessee"), a Texas Corporation, whose address is c/o Lone Star Pipeline Company, 301 S Harwood, Dallas, Texas 75201 Whereas, Lotta E Callahan, et al, as Lessors, and Lone Star Gas Company, as Lessee, entered into that certain Lease dated November 7, 1966, recorded in Book 545, Page 35, of the Deed Records of Denton County, Texas (hereinafter referred to as the "Lease"), and Whereas, Lone Star Gas Company changed its name to ENSERCH Corporation, and Whereas, Lessor is the present owner of the lessor's interest in the Lease and is the owner of the underlying fee simple and reversionary interests in the lands covered by the Lease, and Whereas, Lessor and Lessee desire to amend the Lease to provide for the drilling of storage wells for Lessee's natural gas storage project known as Lake Dallas Storage on the lands covered by the Lease, to change Lessee's address and to change the annual rental, NOW, THEREFORE, for and in consideration of the sum of Ten Dollars ($10 00) cash in hand paid by Lessee to Lessor, the receipt, adequacy and sufficiency of which is hereby acknowledged, and of the covenants and agreements hereinafter made, Lessor and Lessee hereby agree to amend the Lease, effective July 1, 1997, as follows 1 The second sentence of the first paragraph on page 3 shall be deleted and the following substituted in place thereof " During the term of this lease, Lessee agrees to pay to Lessor, c/o City Manager, City of Denton, Texas, 215 East McKinney, Denton, Texas 76201, on or before July 1, 1997 and thereafter, on or before July I' of each succeeding year, the sum of Four Thousand Nine Hundred Sixty and 80/100 Dollars ($4,960 80) as annual rental for the above described land Beginning with the rental payment due July 1, 2003, and each five year period thereafter, the rental amount shall be adjusted either upward or downward, with a 5% per year ceiling or floor, in accordance with the annual average percent change in Consumer Price Index of the Bureau of Labor Statistics of the United States Department of Labor, Utility (piped) Gas, using 1997 as the base year The adjustments in the annual rental are determined by multiplying $4,960 80 by a fraction, the numerator of which is the index number for the last calendar year that ended immediately before the year in which the adjustment is to be made and the denominator of which is the index number for the calendar year 1997 In the event the numbers are revised by the Bureau of Labor Statistics, then the annual rental shall be adjusted to reflect such revision In the event the index is discontinued, the parties shall use a mutually agreeable index using the most nearly comparable statistics published by a recognized financial authority " 2 The fourth sentence of the first paragraph on page 3 shall be deleted and the following substituted in place thereof "Notice shall be given to Lessee by certified mail addressed to ENSERCH Corporation c/o Lone Star Pipeline Company, Attn Reservoir Engineering, 301 S Harwood Street, Dallas, Texas 75201 or to such officer of any successor or assign thereof" 3 By adding the following sentence to the first full paragraph on page 2 "Lessee shall have the right to drill, maintain and operate natural gas storage wells on the premises aforesaid for the injection and/or withdrawal of natural gas " The Lease shall remain to full force and effect as herein amended IN WITNESS WHEREOF, this Amendment is executed by the parties hereto as of the day and year first written above ATTEST "Lessor" City of Denton, Texas By 0��-�Z +� By—�- Jennifer Walters, City Secretary Ted Benavides, City Manager APPROVED AS TO LEGAL FORM By'V Herbert L Prodly, Cit Attorney "Lessee" ENSERCH Corporation By Printed Name Biegier Title Chairman 1766 - Page 2 STATE OF TEXAS COUNTY OF DALLAS BEFORE ME, the undersigned aupority, a Notary Public in and for the State of Texas, on this day personally appeared ��, U)��L7, e cd ], it & err>AAi of ENSERCH Corporation, a Texas corporate n, known to me to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me that he executed the same for the purposes and consideration therein expressed, in the capacity therein stated, and as the act and deed of said corporation GIVEN UNDER MY HAND AND SEAL OF OFFICE, on this the%/ay of, 1997 "tQs� a��b Cherry H Sossamon ��[�`• Commission Expires ,t October 31, 2000 STATE OF TEXAS COUNTY OF DENTON �l i Notary Publeq and for the State of Texas BEFORE ME, the undersigned authority, a Notary Public in and for the State of Texas, on this day personally appeared Ted Benavedes, City Manager of City of Denton, Texas, a municipal corporation acting by and through its City Manager, known to me to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me that he executed the same for the purposes and consideration therein expressed, in the capacity therein stated, and as the act and deed of said corporation GIVEN UNDER MY HAND AND SEAL OF OFFICE, on tlus the fl day of 1997 pr00 W X0cX OOXXXXX000%10 ,pr" ANN FORSYTHE 8 Notary Public, State of Taxes 8 SQt �+e My Commiseion Explrae 06-0019988Q �00000000000X00000000000OOOOOt931 1766 - Page 3 Notary Public en and for the State of Texas STATE OF TEXAS COUNTY OF DENTON [LS-T-SL #17661 KNOWN ALL MEN BY THESE PRESENTS This Memorandum of Lease Amendment ("Notice") shall be effective concurrently with that certain Lease Amendment ("Amendment") dated effective July 1, 1997, by and between City of Denton, Texas, as Lessor, whose mailing address is 215 East McKinney, Denton, Texas 76201, and ENSERCH Corporation, a Texas Corporation, whose address is c/o Lone Star Pipeline Company, 301 S Harwood, Dallas, Texas 75201, as Lessee This Amendment entered into between Lessor and ENSERCH Corporation pertains to and covers those same certain lands ("Subject Lands") described in that certain Lease dated November 7, 1966, recorded in Book 545, Page 35, of the Deed Records of Denton County, Texas ("Lease") This Amendment provides in part that Lessor has granted ENSERCH Corporation the exclusive right to drill storage wells for Lessee's natural gas storage project known as Lake Dallas Storage on the land covered by the Lease A fully executed copy of the Lease is in possession of both Lessor and ENSERCH Corporation at their respective addresses LESSOR CITY OF DENTON, TEXAS By �Benav , City Manager ATTEST By Jennifer We tars, city Secret y APPROVED AS TO LEGAL FORM HERBERT L PROUTY, CITY ATTORNEY By STATE OF TEXAS # COUNTY OF DENTON S ,�` This instrument was acknowledged before me, Notary Public, this the 1� day of June, 1997, by Ted Benavides, City Manager of City of Denton, Texas, a municipal corporation, for the purposes and consideration therein expressed, in the capacity therein stated, and as the act and deed of said corporation IN WITNESS WHEREOF, I hereunto set my hand and offic11 seal My commission expires 50 9� 93 X _ 14 A ANN 01 Notilry Public goof TOX0 • . my commillionaZim • LS-T-SL #1767 AMENDMENT OF LEASE This Amendment of Lease (the "Amendment") as entered into this LtIl day of -C�l997, by and between City of Denton, Texas, (hereinafter sometimes referred to as the "Lessor"), whose address as 215 East McKinney, Denton, Texas 76201, and ENSERCH Corporation (hereinafter sometimes referred to as "Lessee"), a Texas Corporation, whose address is c% Lone Star Pipeline Company, 301 S Harwood, Dallas, Texas 75201 Whereas, Lotta E Callahan, et al, as Lessors, and Lone Star Gas Company, as Lessee, entered into that certain Lease dated November 7, 1966, recorded in Book 545 Page 31, of the Deed Records of Denton County, Texas (hereinafter referred to as the "Lease"), and Whereas, Lone Star Gas Company changed its name to ENSERCH Corporation, and Whereas, insofar as the Lease covers the tracts of land described on Exhibit "A" attached hereto and incorporated herein, Lessor is the present owner of the lessor's interest in the Lease and is the owner of the underlying fee simple and reversionary interests in such tracts, and Whereas, Lessor and Lessee desire to amend the Lease to provide for the drilling of natural gas storage wells for Lessee's natural gas storage project known as Lake Dallas Storage on the tracts covered by the Lease, to change Lessee's address and to change the annual rental, NOW, THEREFORE, for and in consideration of the sum of Ten Dollars ($10 00) cash in hand paid by Lessee to Lessor, the receipt, adequacy and sufficiency of which as hereby acknowledged, and of the covenants and agreements hereinafter made, Lessor and Lessee hereby agree to amend the Lease only uisofar as it covers the tracts described on Exhibit "A" attached hereto, effective July 1, 1997, as follows 1 The third and fourth sentences of the second paragraph on page 2 shall be deleted and the following substituted in place thereof "In the event that subsequent to the commencement of gas storage operations it may be necessary to rework, treat, recomplete, or service any of the aforesaid wells or to drill additional wells, then Lessor shall permit Lessee to use two (2) acres in the form of a square around each of the three (3) well sites on the tracts described on Exhibit "A" in order to carry out said reworking, treating, recompletion, drilling or other operations Lessor shall not erect any buildings, tanks, or structures of any kind on said two -acre tracts reserved for such purposes Lessor shall have the right on that part of the leased tracts lying outside the current chain link fences surrounding each of the three well sites, to reasonably, without interference to Lessee, spread on the surface or inject bro-solid materials in the sod, provided, however, such spreading or injecting of bao-solid materials shall not disturb or soften the soil to the extent that drilling or reworking ngs will not have a solid pad on which to work " 2 The second sentence of the fourth paragraph on page 2 shall be deleted and the following substituted in place thereof " During the term of this lease, Lessee agrees to pay to Lessor, c% City Manager, City of Denton, Texas, 215 East McKinney, Denton, Texas 76201, on or before July 1, 1997 and thereafter, on or before July I' of each succeeding year, the sum of Four Thousand Three Hundred Twenty and No/100 Dollars ($4,320 00) as annual rental for the three well locations on property described on Exhibit "A" to this Amendment of Lease Beginning with the rental payment due July 1, 2003, and each five year period thereafter, the rental amount shall be adjusted either upward or downward, with a 5% per year ceilmg or floor, in accordance with the annual average percent change in Consumer Price Index of the Bureau of Labor Statistics of the United States Department of Labor, Utility (piped) Gas, using 1997 as the base year The adjustments m the annual rental are determined by multiplying $4,320 00 by a fraction, the numerator of which is the mdex number for the last calendar year that ended immediately before the year in which the adjustment is to be made and the denominator of which is the index number for the calendar year 1997 In the event the numbers are revised by the Bureau of Labor Statistics, then the annual rental shall be adjusted to reflect such revision In the event the index is discontinued, the parties shall use a mutually agreeable index using the most nearly comparable statistics published by a recognized financial authority " 3 The fourth sentence of the fourth paragraph on page 2 shall be deleted and the following substituted in place thereof "Notice shall be given to Lessee by certified mail addressed to ENSERCH Corporation c/o Lone Star Pipeline Company, Attn Reservoir Engineering, 301 S Harwood Street, Dallas, Texas 75201 or to such officer of any successor or assign thereof " The Lease shall remain in full force and effect as herein amended IN WITNESS WHEREOF, this Amendment is executed by the parties hereto as of the day and year first written above "Lessor" ATTEST City of Denton, Texas By Jennifer Walters, City Secretary `OV-A� Ted Benavides, City Manager B Phi U , +OIL GAL FORM Herbert L Pr , City Attorney "Lessee" ENSERCH Corporation By U� Printed Name Title Chairman 1767 - Page 2 STATE OF TEXAS COUNTY OF DALLAS BEFORE ME, the unden4gried authority, a Notary Public in and for the State of Texas, on this day personally appeared 1) 10 , L L , z mi<I N of ENSERCH kh Corporation, a Texas corporation, own to me to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me that he executed the same for the purposes and consideration therein expressed, in the capacity therein stated, and as the act and deed of said corporation GIVEN UNDER MY HAND AND SEAL OF OFFICE, on this that / 4ay of j o n_; 1997 II• Commisslon Expires 'e;�V V October 31, 2000 Notary Pubb and for the State of Texas STATE OF TEXAS COUNTY OF DENTON BEFORE ME, the undersigned authority, a Notary Public in and for the State of Texas, on this day personally appeared Ted Benavides, City Manager of City of Denton, Texas, a municipal corporation acting by and through its City Manager, known to me to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me that he executed the same for the purposes and consideration therein expressed, in the capacity therein stated, and as the act and, deed of said corporation GIVEN UNDER MY HAND AND SEAL OF OFFICE, on this the [�. day of 1997 000000oo^�Ge0000a000000000000°0° ary Public m and f the ANN POaSYTHE g State of Texas Notary Public, State otTex ea 2 My0ommlwon6xpliaa 06.09 19A6 ��tlMaQ0t�0Oa6004000000Cg00 1767 - Page 3 Exhibit "A" Attached to and made a part of that certain Amendment of Lease dated , 1997, by and between City of Denton, Texas, and ENSERCH Corporation Two (2) acres in the form of a square around each of the following three (3) well sites Lake Dallas Gas Storage Unit #2 660' FNL and 3440' FWL of the G Walker Survey Lake Dallas Gas Storage Unit #3 1900' FNL and 5470' FWL of the G Walker Survey Lake Dallas Gas Storage Unit #6 1050' FNL and 4100' FEL of the G Walker Survey A-1330, Denton County, Texas 17 M I)MA UION 1767 - Page 4 [LS-T-SL #17671 STATE OF TEXAS KNOWN ALL MEN BY THESE PRESENTS COUNTY OF DENTON 5 This Memorandum of Lease Amendment ("Notice") shall be effective concurrently with that certain Lease Amendment ("Amendment") dated effective July 1, 1997, by and between City of Denton, Texas, as Lessor, whose mailing address is 215 East McKinney, Denton, Texas 76201, and ENSERCH Corporation, a Texas Corporation, whose address is c/o Lone Star Pipeline Company, 301 S Harwood, Dallas, Texas 75201, as Lessee This Amendment entered into between Lessor and ENSERCH Corporation pertains to and covers those same certain lands ("Subject Lands") described in that certain Lease dated November 7, 1966, recorded in Book 545, Page 31, of the Deed Records of Denton County, Texas ("Lease") This Amendment provides in part that Lessor has granted ENSERCO Corporation the exclusive right to drill storage wells for Lessee's natural gas st rage project known as Lake Dallas Storage on the land covered by the Lease A fully executed copy of the Lease is in possession of both Lessor and ENSERCH Corporation at their respective addressee LESSOR CITY OF DENTON, TEXAS By .'Ted Be�City Manager ATTEST By Jennifer Waiters, city Secreta APPROVED AS TO LEGAL FORM HERBERT L PROUTY, CITY ATTORNEY By STATE OF TEXAS COUNTY OF DENTON $ This instrument was acknowledged before me, Notary Public, this the l) day of June, 1997, by Ted Benavides, City Manager of City of Denton, Texas, a municipal corporation, for the purposes and consideration therein expressed, in the capacity therein stated, and as the act and deed of said corporation IN WITNESS WHEREOF, I hereunto set my hand and official seal My commission expires 5 of ....... ............ 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