2015-162ORDINANCE NO. 2015 -162
AN ORDINANCE FINDING THAT A PUBLIC USE AND NECESSITY EXISTS TO
ACQUIRE FEE SIMPLE TITLE TO A 0.138 ACRE TRACT LOCATED IN THE E.
PUCHALSKI SURVEY, ABSTRACT NO. 996, CITY OF DENTON, DENTON COUNTY,
TEXAS, AS MORE PARTICULARLY DESCRIBED AND DEPICTED ON THE ATTACHED
EXHIBIT "A" AND LOCATED GENERALLY IN THE 100 BLOCK OF N. BONNIE BRAE
ST. (THE "PROPERTY INTEREST "), FOR THE PUBLIC USE OF EXPANSION,
CONSTRUCTION, MAINTENANCE, OPERATION, AND IMPROVEMENT OF ELECTRIC
TRANSMISSION AND DISTRIBUTION LINES, FACILITIES, AND STRUCTURES,
INCLUDING SUBSTATIONS AND SWITCH STATIONS; AUTHORIZING THE CITY
MANAGER, OR HIS DESIGNEE, TO MAKE A FINAL OFFER TO SERENDIPITY
BUSINESS INTERESTS, LLC, A TEXAS LIMITED LIABILITY COMPANY ( "OWNER ")
TO PURCHASE THE PROPERTY INTEREST FOR THE PRICE OF SEVENTY FIVE
THOUSAND AND 00 /100 DOLLARS ($75,000.00), AND OTHER CONSIDERATION, AS
SET FORTH IN THE CONTRACT OF SALE ATTACHED AS EXHIBIT "B ";
AUTHORIZING THE FILING OF EMINENT DOMAIN PROCEEDINGS TO ACQUIRE THE
PROPERTY INTEREST IF THE FINAL OFFER IS NOT ACCEPTED; AUTHORIZING THE
EXPENDITURE OF FUNDS; AND PROVIDING AN EFFECTIVE DATE.
RECITALS
WHEREAS, the City of Denton, Texas ( "City ") has initiated the expansion, construction,
maintenance, operation, and improvement of electric transmission and distribution lines,
facilities, and structures, including substations and switch stations, affecting, among other lands
and interests, a 0.138 acre tract located in the E. Puchalski Survey, Abstract No. 996, City of
Denton, Texas, as more particularly described and depicted on the attached Exhibit "A" and
located generally in the 100 block of N. Bonnie Brae St. ( "Property Interest ");
WHEREAS, the expansion, construction, maintenance, operation, and improvement of
electric transmission and distribution lines, facilities, and structures constitute a valid public use
of the City and its citizens;
WHEREAS, on April 27, 2015, the City made a written initial offer to Serendipity
Business Interests, LLC, a Texas limited liability company ( "Owner ") to purchase the Property
Interest;
WHEREAS, the notice for the public meeting of the City Council of the City in which
this Ordinance is considered, as required by Subchapter C, Chapter 551, of the Texas
Government Code, in addition to other information, as required by that subchapter, expressly
included the consideration by the City of Denton of the use of eminent domain to condemn the
Property Interest;
WHEREAS, in ordaining the matters set forth herein, the motion to pass and approve this
ordinance was stated as "I move that the City Manager, or his designee, is authorized to (1)
make a written final offer to the Owner, any and all of Owner's successors -in- interest to the
Property Interest, or any other parties who may own any interest in the Property Interest to
purchase a 0.138 acre tract located in the E. Puchalski Survey, Abstract No. 996, City of Denton,
Denton County, Texas, and located generally in the 100 block of N. Bonnie Brae St. (the
"Property Interest ") as more particularly described on Exhibit "A" to the ordinance now under
consideration and on the overhead screen being now displayed to the audience, for the public use
for the expansion, construction, maintenance, operation, and improvement of the City's electric
transmission and distribution lines, facilities, and structures, including substations and switch
stations; and (2), if the terms of the written final offer are not agreed to by the Owner, any and all
of Owner's successors -in- interest to the Property Interest, or any other parties who may own an
interests in the Property Interest, to then use of the power of eminent domain to acquire fee
simple title to the Property Interest "; and
WHEREAS, after due consideration of the public interest and necessity and the public
use and benefit to accrue to the City of Denton, Texas:
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS:
SECTION 1. The recitals provided in this Ordinance, as set forth above, are adopted by
the City Council as findings of the City Council.
SECTION 2. The City Council finds:
A. On April 27, 2015 the City made a written initial offer by certified mail,
return receipt requested, to Owner to purchase the Property Interest for $75,000.00, and
other consideration, which, in addition to the Purchase Price, included:
i. All appraisal reports produced or acquired by the City relating
specifically to the Property Interest and prepared in the 10 years preceding the
date the written initial offer was made;
ii. Non Confidentiality Notice;
iii. Contract of Sale executed by the City Manager, or his designee,
which includes a copy of the deed conveying the Property Interest; and
iv. Texas Landowner's Bill of Rights
B. The Owner was the record title owner of said Property Interest at the time
of making the Initial Offer.
C. It has been at least 30 days since the written initial offer was mailed to the
Owner.
SECTION 3. The City Manager, or his designee, is authorized to make a written final
offer by certified mail, return receipt requested, to purchase the Property Interest to the Owner,
any and all of Owner's successors -in- interest to the Property Interest or any other parties who
may own any interests in the Property Interest. The written final offer will include:
A. A purchase price for the Property Interest which is equal to or greater than
the amount of the written appraisal obtained by the City;
B. Texas Landowner's Bill of Rights;
C. A written appraisal from a certified appraiser of the value of the Property
Interest and the damages, if any, to any of the Owner's remaining property;
D. All appraisal reports produced or acquired by the City relating specifically
to the Property Interest and prepared in the 10 years preceding the date the written initial
offer was made;
E. Contract of Sale executed by the City Manager, or his designee, which
will include a copy of the deed conveying the Property Interest; and
F. A statement that at least fourteen (14) days shall be given for the Owner to
respond to the final written offer and agree to the terms of the same within that period.
SECTION 4. The City Manager, or his designee, is authorized to (a) execute the
Contract of Sale between the City and Owner for the purchase of the Property Interest for the
purchase price of $75,000.00, and other consideration, plus costs and expenses, and any other
documents necessary for purchasing the Property Interest; and (b) to make expenditures in
accordance with the terms of the Contract. The Contract of Sale is attached as Exhibit "B ".
SECTION 5. The City Council, through the exercise of its home -rule and statutory
authority, authorizes the filing and prosecution of eminent domain proceedings by the City of
Denton, Texas to acquire the Property Interest if the Owner does not accept the terms of the
written final offer within the time period. The City Council further authorizes joinder of
additional or differing owner or owners, or claimant or claimants, of the Property Interest, if
applicable, in the eminent domain proceedings, and to condemn the interests of each to acquire
the Property Interest.
SECTION 6. The City Manager, or his designee, has the authority to do all things
necessary or appropriate to acquire the Property Interest by eminent domain, including without
limitation, the authority to retain and hire, on behalf of the City, counsel to file and prosecute
eminent domain proceedings, and to expend funds related to the prosecution of such
proceedings.
SECTION 7. If any section, article, paragraph, sentence, phrase, clause or word in this
ordinance, or application thereof to any persons or circumstances, is held invalid or
unconstitutional by a court of competent jurisdiction, such holding shall not affect the validity of
the remaining portions of this ordinance; the City Council declares that it would have ordained
SECTION 7. If any section, article, paragraph, sentence, phrase, clause or word in this
ordinance, or application thereof to any persons or circumstances, is held invalid or
unconstitutional by a court of competent jurisdiction, such holding shall not affect the validity of
the remaining portions of this ordinance; the City Council declares that it would have ordained
such remaining portion despite such invalidity, and such remaining portion shall remain in full
force and effect.
SECTION 8.
approval.
This ordinance shall become effective immediately upon its passage and
PASSED AND APPROVED this the
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
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STATE OF TEXAS
COUNTY OF DENTON
Exhibit B
CONTRACT OF SALE
NOTICE
YOU, AS OWNER OF THE PROPERTY (AS DEFINED BELOW), HAVE
THE RIGHT TO: (1) DISCUSS ANY OFFER OR AGREEMENT
REGARDING THE CITY OF DENTON'S ACQUISITION OF THE
PROPERTY WITH OTHERS; OR (2) KEEP THE OFFER OR
AGREEMENT CONFIDENTIAL, UNLESS THE OFFER OR
AGREEMENT IS SUBJECT TO CHAPTER 552, GOVERNMENT CODE.
This Contract of Sale (the "Contract ") is made this day of
, 2015, effective as of the date of execution hereof by Buyer, as
defined herein (the "Effective Date "), by and between SERENDIPITY BUSINESS INTERESTS,
LLC, a Texas limited liability company, (referred to herein as "Seller ") and the City of
Denton, Texas, a Home Rule Municipal Corporation of Denton County, Texas (referred
to herein as "Buyer ").
RECITALS
WHEREAS, Seller owns that certain tract of land being more particularly
described and depicted on Exhibit "A ", attached hereto and made a part hereof for all
purposes, being located in Denton County, Texas (the "Land "); and
WHEREAS, Seller desires to sell to Buyer, and Buyer desires to buy from Seller,
the Land, together with any and all rights or interests of Seller in and to adjacent streets,
alleys and rights of way and together with all and singular the improvements and fixtures
thereon and all other rights and appurtenances to the Land (collectively, the "Property ").
ARTICLE I
SALE OF PROPERTY
For the consideration hereinafter set forth, and upon the terms, conditions and
provisions herein contained, and subject to the reservations herein, Seller agrees to sell
and convey to Buyer, and Buyer agrees to purchase from Seller, the Property.
Seller, subject to the limitation of such reservation made herein, shall reserve, for
itself, its successors and assigns all of its oil, gas and other minerals in, on and under and
that may be produced from the Property. Seller, its successors and assigns shall not have
the right to use or access the surface of the Property, in any way, manner or form, in
connection with or related to the reserved oil, gas, and other minerals and /or related to
exploration and /or production of the oil, gas and other minerals reserved herein, including
without limitation, use or access of the surface of the Property for the location of any well
or drill sites, well bores, whether vertical or any deviation from vertical, water wells, pit
areas, seismic activities, tanks or tank batteries, pipelines, roads, electricity or other
utility infrastructure, and /or for subjacent or lateral support for any surface facilities or
well bores, or any other infrastructure or improvement of any kind or type in connection
with or related to the reserved oil, gas and other minerals, and /or related to the
exploration or production of same.
As used herein, the term "minerals" shall include oil, gas and all associated
hydrocarbons, and shall exclude (i) all substances (except oil, gas and all associated
hydrocarbons) that any reasonable extraction, mining or other exploration and /or
production method, operation, process or procedure would consume, deplete or destroy
the surface of the Property; and (ii) all substances (except oil and gas) which are at or
near the surface of the Property. The intent of the parties hereto is that the meaning of
the term "minerals" as utilized herein, shall be in accordance with that set forth in Reed v.
Wylie, 597 S.W.2d 743 (Tex. 1980).
As used herein, the term "surface of the Property" shall include the area from the
surface of the earth to a depth of five hundred feet (500') below the surface of the earth
and all areas above the surface of the earth,
ARTICLE II
PURCHASE PRICE AND EARNEST MONEY
2.01 Purchase Price, The Purchase Price to be paid to Seller for the Property is the
sum of SEVENTY -FIVE THOUSAND and N01100 US Dollars ($75,000.00) (the
"Purchase Price ").
2.02 Earnest Money. Buyer shall deposit the sum of One Thousand and No /100
Dollars ($1,000.00), as Earnest Money (herein so called) with Title Resources, LLC, 525
South Loop 288, Suite 125, Denton, Texas, 76205, (the "Title Company "), as escrow
agent, within fourteen (14) calendar days of the Effective Date hereof. All interest earned
thereon shall become part of the Earnest Money and shall be applied or disposed of in the
same manner as the original Earnest Money deposit, as provided in this Contract, If the
purchase contemplated hereunder is consummated in accordance with the terms and the
provisions hereof, the Earnest Money, together with all interest earned thereon, shall be
applied to the Purchase Price at Closing. In all other events, the Earnest Money, and the
interest accrued thereon, shall be disposed of by the Title Company as provided in this
Contract.
2.03 Independent Contract Consideration. Within fourteen (14) calendar days after
the Effective Date, Buyer shall deliver to the Title Company, payable to and for the
benefit of Seller, a check in the amount of One Hundred and No /100 Dollars ($1000)
(the "Independent Contract Consideration "), which amount the parties hereby
acknowledge and agree has been bargained for and agreed to as consideration for Seller's
execution and delivery of the Contract. The Independent Contract Consideration is in
Contract of Sale
Page 2 of 21
addition to, and independent of any other consideration or payment provided in this
Contract, is non - refundable, and shall be retained by Seller notwithstanding any other
provision of this Contract.
ARTICLE III
TITLE AND SURVEY
3.01 Title Commitment.
(a) Within twenty (20) calendar days after the Effective Date, Seller shall cause to be
furnished to Buyer a current Commitment for Title Insurance (the "Title
Commitment ") for the Property, issued by Title Company. The Title
Commitment shall set forth the state of title to the Property, including a list of
liens, mortgages, security interests, encumbrances, pledges, assignments, claims,
charges, leases (surface, space, mineral, or otherwise), conditions, restrictions,
options, severed mineral or royalty interests, conditional sales contracts, rights of
first refusal, restrictive covenants, exceptions, easements (temporary or
permanent), rights -of -way, encroachments, or any other outstanding claims,
interests, estates or equities of any nature (each of which are referred to herein as
an "Exception ").
(b) Along with the Title Commitment, Seller shall also cause to be delivered to
Buyer, at Buyer's sole cost and expense, true and correct copies of all instruments
that create or evidence Exceptions (the "Exception Documents "), including those
described in the Title Commitment as exceptions to which the conveyance will be
subject and /or which are required to be released or cured at or prior to Closing.
3.02 Survey. Within thirty (30) calendar days after the Effective Date, Seller shall
cause to be prepared at Buyer's expense, a current on the ground survey of the Property
(the "Survey "). The contents of the Survey shall be prepared by a surveyor selected by
Buyer and shall include the matters prescribed by Buyer, which may include but not be
limited to, a depiction of the location of all roads, streets, easements and rights of way,
both on and adjoining the Property, water courses, 100 year flood plain, fences and
improvements and structures of any kind. The Survey shall describe the size of the
Property, in acres, and contain a metes and bounds description thereof. Seller shall
furnish or cause to be furnished any affidavits, certificates, assurances, and/or resolutions
as required by the Title Company in order to amend the survey exception as required by
Section 3.05 below. The description of the Property as set forth in the Survey, at the
Buyer's election, shall be used to describe the Property in the deed to convey the Property
to Buyer and shall be the description set forth in the Title Policy.
3.03 Review of Title Commitment, Survey and Exception Documents. Buyer shall
have a period of fifteen (15) calendar days (the "Title Review Period ") commencing with
the day Buyer receives the last of the Title Commitment, the Survey, and the Exception
Documents, in which to give written notice to Seller, specifying Buyer's objections to
one or more of the items ( "Objections "), if any. All items set forth in the Schedule C of
Contract of Sale
Page 3 of 21
the Title Commitment, and all other items set forth in the Title Commitment which are
required to be released or otherwise satisfied at or prior to Closing, shall be deemed to be
Objections without any action by Buyer.
3.04 Seller's Obligation to Cure; Buyer's Right to Terminate. The Seller shall,
within twenty (20) calendar days after Seller is provided notice of Objections, either
satisfy the Objections at Seller's sole cost and expense or promptly notify Buyer in
writing of the Objections that Seller cannot or will not satisfy at Seller's expense.
Notwithstanding the foregoing sentence, Seller shall, in any event, be obligated to cure
those Objections or Exceptions that have been voluntarily placed on or against the
Property by Seller after the Effective Date. If Seller fails or refuses to satisfy any
Objections that Seller is not obligated to cure within the allowed twenty (20) calendar day
period, and if Buyer does not agree in writing to an extension of that period, said
extension to not exceed an additional thirty (30) calendar days, then Buyer has the option
of either:
(a) waiving the unsatisfied Objections by, and only by, notice in writing to Seller
prior to Closing, in which event those Objections shall become Permitted
Exceptions (herein so called), or
(b) terminating this Contract by notice in writing prior to Closing and receiving back
the Earnest Money, in which latter event Seller and Buyer shall have no further
obligations, one to the other, with respect to the subject matter of this Contract.
3.04.A. Additional Title Commitment. Due to the fact that the effective period
of the Title Commitment shall expire prior to Closing, Seller shall cause to be furnished
to Buyer, no earlier than ninety one (91) calendar days after the Effective Date and no
later than one hundred ten (110) calendar days after the Effective Date, a Title
Commitment ( "Updated Commitment "), in the form of the Title Commitment prescribed
by Section 3.01, above. Buyer shall have fifteen (15) calendar days to review and
provide Objections, if any, to the items in the Updated Commitment in the same manner
as prescribed by Section 3.03 related to the Title Commitment. All time periods related
to review and cure of the Objections, waiver of uncured Objections and termination of
this Contract, as set forth in Article III, above, shall be applicable to the Objections by
Buyer to the Updated Commitment, if any, and Closing shall be so extended to
accommodate such review and cure period.
3.05 Title Policy. At Closing, Seller, at Buyer's sole cost and expense, shall cause a
standard Texas Owner's Policy of Title Insurance ( "Title Policy ") to be furnished to
Buyer. The Title Policy shall be issued by the Title Company, in the amount of the
Purchase Price and insuring that Buyer has indefeasible fee simple title to the Property,
subject only to the Permitted Exceptions. The Title Policy may contain only the
Permitted Exceptions and shall contain no other exceptions to title, with the standard
printed or common exceptions amended or deleted as follows:
(a) survey exception must be amended if required by Buyer to read "shortages in
Contract of Sale
Page 4 of 21
area" only (although Schedule C of the Title Commitment may condition
amendment on the presentation of an acceptable survey and payment, to be borne
solely by Buyer, of any required additional premium);
(b) no exception will be permitted for "visible and apparent easements" or words to
that effect (although reference may be made to any specific easement or use
shown on the Survey, if a Permitted Exception);
(c) no exception will be permitted for "rights of parties in possession "; and
(d) no liens will be shown on the title commitment,
Notwithstanding the enumeration of the following exceptions, amendments and/or
deletions, Buyer may object to any Exception it deems material, in its sole discretion.
ARTICLE IV
FEASIBILITY REVIEW PERIOD
4.01 Review Period. Any term or provision of this Contract notwithstanding, the
obligations of Buyer specified in this Contract are wholly conditioned on Buyer's having
determined, in Buyer's sole and absolute discretion, during the period commencing with
the Effective Date of this Contract and ending sixty (60) calendar days thereafter (the
"Absolute Review Period "), based on such tests, examinations, studies, investigations and
inspections of the Property the Buyer deems necessary or desirable, including but not
limited to studies or inspections to determine the existence of any environmental hazards
or conditions, performed at Buyer's sole cost, that Buyer finds the Property suitable for
Buyer's purposes. Buyer is granted the right to conduct engineering studies of the
Property, and to conduct a physical inspection of the Property, including inspections that
invade the surface and subsurface of the Property. If Buyer determines, in its sole
judgment, that the Property is not suitable, for any reason, for Buyer's intended use or
purpose, the Buyer may terminate this Contract by written notice to the Seller, as soon as
reasonably practicable, but in any event prior to the expiration of the Absolute Review
Period, in which case the Earnest Money will be returned to Buyer, and neither Buyer nor
Seller shall have any further duties or obligations hereunder. In the event Buyer elects to
terminate this Contract pursuant to the terms of this Article IV, Section 4.01, Buyer will
provide to Seller copies of (i) any and all non - confidential and non - privileged reports and
studies obtained by Buyer during the Absolute Review Period; and (ii) the Survey.
ARTICLE V
REPRESENTATIONS WARIIANTIF.S COVENANTS AND
AGREEMENTS
5.01 Representations and Warranties of Seller. To induce Buyer to enter into this
Contract and consummate the sale and purchase of the Property in accordance with the
terms and provisions herewith, Seller represents and warrants to Buyer as of the Effective
Date and as of the Closing Date, except where specific reference is made to another date,
Contract of Sale
Page 5 of 21
that:
(a) The descriptive information concerning the Property set forth in this Contract is
complete, accurate, true and correct.
(b) There are no adverse or other parties in possession of the Property or any part
thereof, and no party has been granted any license, lease or other right related to
the use or possession of the Property, or any part thereof, except those described
in the Leases, as defined in Article V, Section 5.02(a).
(c) The Seller has good and marketable fee simple title to the Property, subject only
to the Permitted Exceptions.
(d) The Seller has the full right, power, and authority to sell and convey the Property
as provided in this Contract and to carry out Seller's obligations hereunder.
(e) The Seller has not received notice of, and has no other knowledge or information
of, any pending or threatened judicial or administrative action, or any action
pending or threatened by adjacent landowners or other persons against or
affecting the Property.
(f) The Seller has disclosed to Buyer in writing of any and all facts and
circumstances relating to the physical condition of the Property that may
materially and adversely affect the Property and operation or intended operation
thereof, or any portion thereof, of which Seller has knowledge.
(g) The Seller has paid all real estate and personal property taxes, assessments,
excises, and levies that are presently due, if any, which are against or are related
to the Property, or will be due as of the Closing, and the Property will be subject
to no such liens.
(h) The Seller shall convey the Property free and clear of all debts, liens and
encumbrances.
(i) Seller has not contracted or entered into any agreement with any real estate
broker, agent, finder, or any other party in connection with this transaction or
taken any action which would result in any real estate broker commissions or
finder's fee or other fees payable to any other party with respect to the
transactions contemplated by this Contract,
(j) To the best of Seller's knowledge, there has not occurred the disposal or release
of any Hazardous Substance to, on or from the Property.
As used in this Contract, "Hazardous Substance" means and includes all
hazardous and toxic substances, waste or materials, chemicals, and any pollutant
or contaminant, including without limitation, PCB's, asbestos, asbestos-
Contract of Sale
Page 6 of 21
containing material, petroleum products and raw materials, that are included
under or regulated by any Environmental Law or that would or may pose a health,
safety or environmental hazard.
As used in this Contract, "Environmental Law" means and includes all federal,
state, and local statutes, ordinances, regulations and rules presently in force or
hereafter enacted relating to environmental quality, contamination, and clean -up
of Hazardous Substances, including without limitation, the Comprehensive
Environmental Response, Compensation and Liability Act (42 U.S.C. 9601, et
seq.), as amended by the Superfund Amendments and Reauthorization Act of
1986, the Resource Conservation and Recovery Act (42 U.S.C. 6901, et seq.), as
amended, Toxic Substance Control Act, 15 U.S.C. 2601, et seq., and state
superlien and environmental clean -up statutes and all rules and regulations
presently or hereafter promulgated under or related to said statutes, as amended.
(k) All Leases, as defined in Article V, Section 5.02(a), shall have expired or
otherwise terminated and any and all tenants or parties occupying the Property
pursuant to the Leases shall have permanently abandoned and vacated the
Property on or before the date of Closing.
(1) The Seller is not a "foreign person" as defined in Section 1445 of the Internal
Revenue Code of 1986, as amended.
5.02 Covenants and Agreements of Seller. Seller covenants and agrees with Buyer
as follows:
(a) Unless stated otherwise, within ten (10) calendar days after the Effective Date,
Seller, at Seller's sole cost and expense, shall deliver to Buyer, with respect to the
Property, true, correct, and complete copies of the following:
(i) All lease agreements and /or occupancy agreements and /or licenses of any
kind or nature (if oral, Seller shall provide to Buyer in writing all material
terms thereof) relating to the possession of the Property, or any part
thereof, including any and all modifications, supplements, and
amendments thereto (the "Leases").
(ii) All environmental audits, soil tests and engineering and feasibility reports,
including any and all modifications, supplements and amendments thereto,
with respect to the Property that Seller possesses or has the right to
receive.
(b) From the Effective Date until the date of Closing or earlier termination of this
Contract, Seller shall:
(i) Not enter into any written or oral contract, lease, easement or right of way
agreement, conveyance or any other agreement of any kind with respect
Contract of Sale
Page 7 of 21
to, or affecting, the Property that will not be fully performed on or before
the Closing or would be binding on Buyer or the Property after the date of
Closing.
(ii) Advise the Buyer promptly of any litigation, arbitration, or administrative
hearing concerning or affecting the Property.
(iii) Not take, or omit to take, any action that would result in a violation of the
representations, warranties, covenants, and agreements of Seller.
(iv) Not sell, assign, lease or convey any right, title or interest whatsoever in or
to the Property, or create, grant or permit to be attached or perfected, any
lien, encumbrance, or charge thereon.
(c) Seller shall indemnify and hold Buyer harmless, to the extent permitted by law,
from all loss, liability, and expense, including, without limitation, reasonable
attorneys' fees, arising or incurred as a result of any liens or claims resulting from
labor or materials furnished to the Property under any written or oral contracts
arising or entered into prior to Closing.
5.03 Survival Beyond Closing. Notwithstanding anything to the contrary contained in
this Contract, the representations, warranties, covenants and agreements of Seller
contained in this Contract shall survive the Closing, and shall not, in any circumstance,
be merged with the Special Warranty Deed, as described in Article VII, Section 7.02(a).
ARTICLE VI
CONDITIONS PRECEDENT TO PERFORMANCE
6.01 Performance of Seller's Obligations. Buyer is not obligated to perform under
this Contract unless, within the designated time periods, all of the following shall have
occurred:
(a) Seller has performed, furnished, or caused to be furnished to Buyer all items
required to be so performed or furnished under other sections of this Contract; and
(b) Seller cures or Buyer waives in writing, within the time periods specified in
Article III, all of Buyer's objections made in accordance with Article III.
6.02 Breach of Seller's Representations, Warranties, Covenants and Agreements.
Buyer is not obligated to perform under this Contract unless all representations,
warranties, covenants and agreements of Seller contained in this Contract are true and
correct or have been performed, as applicable, as of the Closing Date, except where
specific reference is made to another date.
6.03 Adverse Change. Buyer is not obligated to perform under this Contract, if on the
date of Closing, any portion of the Property has been condemned by an entity other than
Contract of Sale
Page 8 of 21
Buyer, or is the subject of condemnation, eminent domain, or other material proceeding
initiated by an entity other than Buyer, or the Property, or any part thereof, has been
materially or adversely impaired in any manner.
6.04 Review Period. Buyer is not obligated to perform under this Contract if Buyer
delivers notice to Seller pursuant to Article IV, Section 4.01 that Buyer has determined
that the Property is unsuitable to or for Buyer's purposes.
6.05 Buyer's Right to Waive Conditions Precedent. Notwithstanding anything
contained in this Contract to the contrary, Buyer may, at Buyer's option, elect to waive
any of the conditions precedent to the performance of Buyer's obligations under this
Contract by giving to the Seller, at any time prior to Closing, a written waiver specifying
the waived condition precedent.
6.06 Buyer's Termination if Conditions Precedent Not Satisfied or Waived. If any
of the conditions precedent to the performance of Buyer's obligations under this Contract
have not been satisfied by Seller or waived by the Buyer, the Buyer may, by giving
written notice to Seller, terminate this Contract. On Buyer's termination, the Earnest
Money shall be immediately returned to Buyer by the Title Company. The Seller shall,
on written request from Buyer, promptly issue the instructions necessary to instruct the
Title Company to return to Buyer the Earnest Money and, thereafter, except as otherwise
provided in this Contract, Buyer and Seller shall have no further obligations under this
Contract, one to the other.
ARTICLE VIi
CLOSING
7.01 Date and Place of Closing. The Closing (herein so called) shall take place in the
offices of the Title Company and shall be accomplished through an escrow to be
established with the Title Company, as escrowee. The Closing Date (herein sometimes
called), shall be one hundred and eighty (180) calendar days after the Effective Date,
unless otherwise mutually agreed upon by Buyer and Seller.
7.02 Items to be Delivered at the Closing.
(a) Seller. At the Closing, Seller shall deliver or cause to be delivered to Buyer or
the Title Company, at the expense of the party designated herein, the following
items;
(i) The Title Policy, in the form specified in Article III, Section 3.05;
(ii) The Special Warranty Deed, substantially in the form as attached hereto as
Attachment "1 ", subject only to the Permitted Exceptions, if any, duly
executed by Seller and acknowledged;
Contract of Sale
Page 9 of 21
(iii) Other items reasonably requested by the Title Company as administrative
requirements for consummating the Closing.
(b) Buyer. At the Closing, Buyer shall deliver to Seller or the Title Company, the
following items:
(i) The suin required by Article II, Section 2.01, less the Earnest Money and
interest earned thereon, in the form of a check or cashier's check or other
immediately available funds;
(ii) Other items reasonably requested by the Title Company as administrative
requirements for consummating the Closing,
7.03 Adjustments at Closing. Notwithstanding anything to the contrary contained in
this Contract and without limiting the general application of the provisions of Section
5.03, above, the provisions of this Article VII, Section 7.03 shall survive the Closing.
The following item shall be adjusted or prorated between Seller and Buyer with respect to
the Property:
(a) Ad valorem taxes relating to the Property for the calendar year in which the
Closing shall occur shall be prorated between Seller and Buyer as of the Closing
Date. If the actual amount of taxes for the calendar year in which the Closing
shall occur is not known as of the Closing Date, the proration at Closing shall be
based on the amount of taxes due and payable with respect to the Property for the
preceding calendar year. As soon as the amount of taxes levied against the
Property for the calendar year in which Closing shall occur is known, Seller and
Buyer shall readjust in cash the amount of taxes to be paid by each party with the
result that Seller shall pay for those taxes attributable to the period of time prior to
the Closing Date (including, but not limited to, subsequent assessments for prior
years due to change of land usage or ownership occurring prior to the date of
Closing) and Buyer shall pay for those taxes attributable to the period of time
commencing with the Closing Date.
7.04 Possession at Closing. Possession of the Property shall be delivered to Buyer at
Closing.
7.05 Costs of Closing. Each party is responsible for paying the legal fees of its
counsel, in negotiating, preparing, and closing the transaction contemplated by this
Contract. Seller is responsible for paying fees, costs and expenses identified herein as
being the responsibility of Seller. Buyer is responsible for paying fees, costs and
expenses identified herein as being the responsibility of Buyer. If the responsibility for
such costs or expenses associated with closing the transaction contemplated by this
Contract are not identified herein, such costs or expenses shall be allocated between the
parties in the customary manner for closings of real property similar to the Property in
Denton County, Texas.
Contract of Sale
Page 10 of 21
ARTICLE VIII
DEFAULTS AND REMEDIES
8.01 Seller's Defaults and Buyer's Remedies.
(a) Seller's Defaults. Seller is in default under this Contract on the occurrence of any
one or more Vf'thefollowing events:
(i) Any of Seller's warranties or representations contained in this Contract are
untrue on the Closing Date; or
(ii) Seller fails to meet, comply with or perform any covenant, agreement,
condition precedent or obligation on Seller's part required within the time
limits and in the manner required in this Contract; or
(iii) Seller fails to deliver at Closing, the items specified in Article VII,
Section 7.02(a) of this Contract for any reason other than a default by
Buyer or termination of this Contract by Buyer pursuant to the terms
hereof prior to Closing.
(b) Buyer's Remedies, If Seller is in default under this Contract, Buyer as Buyer's
sole and exclusive remedies for the default, may, at Buyer's sole option, do any of
the following:
(i) Terminate this Contract by written notice delivered to Seller in which
event the Buyer shall be entitled to a return of the Earnest Money, and
Seller shall, promptly on written request from Buyer, execute and deliver
'any documents necessary to cause the Title Company to return to Buyer
the Earnest Money;
(ii) Enforce specific performance of this Contract against Seller, requiring
Seller to convey the Property to Buyer subject to no liens, encumbrances,
exceptions, and conditions other than those shown on the Title
Commitment, whereupon Buyer shall waive title objections, if any, and
accept such title without reduction in Purchase Price on account of title
defects and shall be entitled to assert any rights for damages based on
Seller's representations, warranties and obligations that are not waived by
Buyer by its acceptance of Seller's title; and
(iii) Seek other recourse or relief as may be available to Buyer at or by law,
equity, contract or otherwise.
8.02 Buyer's Default and Seller's Remedies.
(a) Buyer's Default. Buyer is in default under this Contract if Buyer fails to deliver
at Closing, the items specified in Article VII, Section 7.02(b) of this Contract for
Contract of Sale
Page 11 of 21
any reason other than a default by Seller under this Contract or termination of this
Contract by Buyer pursuant to the terms hereof prior to Closing,
(b) Seller's Remedy. If Buyer is in default under this Contract, Seller, as Seller's
sole and exclusive remedies for the default, may, at Seller's sole option, do either
one of the following:
(i) Terminate this Contract by written notice delivered to Buyer in which
event the Seller shall be entitled to a return of the Earnest Money, and
Buyer shall, promptly on written request from Seller, execute and deliver
any documents necessary to cause the Title Company to return to Seller
the Earnest Money; or
(ii) Enforce specific performance of this Contract against Buyer.
ARTICLE 1X
MISCELLANEOUS
9.01 Notice. All notices, demands, requests, and other communications required
hereunder shall be in writing, delivered, unless expressly provided otherwise in this
Contract, by telephonic facsimile, by hand delivery or by United States Mail, and shall be
deemed to be delivered, upon the earlier to occur of (a) the date provided if provided by
telephonic facsimile or hand delivery, and (b) the date of the deposit of, in a regularly
maintained receptacle for the United States Mail, registered or certified, return receipt
requested, postage prepaid, addressed as follows:
SELLER: BUYER:
_. ..... __ City of Denton
Paul Williamson
Real Estate and Capital Support
901 -A Texas Street
1 elecopy. . mmn__w Denton, Texas 76209
Telecopy: (940) 349 -8951
Copies to:
For Seller: For Buyer:
Scott W, Hickey, Attorney at Law
�_�..�..�. ..._� .................... Kelsey, Kelsey & Hickey, PLLC
P.O. Box 918
�_ Denton, Texas 76202
Telecopy ..............._ .... . Telecopy: (940) 387 -9553
Contract of Sale
Page 12 of 21
9.02 Governing Law and Venue. This Contract is being executed and delivered and
is intended to be performed in the State of Texas, the laws of Texas governing the
validity, construction, enforcement and interpretation of this Contract. THIS
CONTRACT IS PERFORMABLE IN, AND THE EXCLUSIVE VENUE FOR ANY
ACTION BROUGHT WITH RESPECT HERETO, SHALL LIE IN DENTON
COUNTY, TEXAS.
9.03 Entirety and Amendments. This Contract embodies the entire agreement
between the parties and supersedes all prior agreements and understandings, if any,
related to the Property, and may be amended or supplemented only in writing executed
by the party against whom enforcement is sought.
9.04 Parties Bound. This Contract is binding upon and inures to the benefit of Seller
and Buyer, and their respective successors and assigns. If requested by Buyer, Seller
agrees to execute, acknowledge and record a memorandum of this Contract in the Real
Property Records of Denton County, Texas, imparting notice of this Contract to the
public.
9.05 Risk of Loss. If any damage or destruction to the Property shall occur prior to
Closing, or if any condemnation or any eminent domain proceedings are threatened or
initiated by an entity or party other than Buyer that might result in the taking of any
portion of the Property, Buyer may, at Buyer's option, do any of the following:
(a) Terminate this Contract and withdraw from this transaction without cost,
obligation or liability, in which case the Earnest Money shall be immediately
returned to Buyer; or
(b) Consummate this Contract, in which case Buyer, with respect to the Property,
shall be entitled to receive any (i) in the case of damage or destruction, all
insurance proceeds; and (ii) in the case of eminent domain, proceeds paid for the
Property related to the eminent domain proceedings.
Buyer shall have a period of up to ten (10) calendar days after receipt of written
notification from Seller on the final settlement of all condemnation proceedings or
insurance claims related to damage or destruction of any improvement located on
the Property, in which to make Buyer's election, In the event Buyer elects to
close prior to such final settlement, then the Closing shall take place as provided
in Article VII, above, and there shall be assigned by Seller to Buyer at Closing all
interests of Seller in and to any and all insurance proceeds or condemnation
awards which may be payable to Seller on account of such event. In the event
Buyer elects to close upon this Contract after final settlement, as described above,
Closing shall be held five (5) business days after such final settlement.
9.06 Further Assurances. In addition to the acts and deeds recited in this Contract
and contemplated to be performed, executed and /or delivered by Seller and Buyer, Seller
and Buyer agree to perform, execute and /or deliver, or cause to be performed, executed
Contract of Sale
Page 13 of 21
and /or delivered at the Closing or after the Closing, any further deeds, acts, and
assurances as are reasonably necessary to consummate the transactions contemplated
hereby. Notwithstanding anything to the contrary contained in this Contract and without
limiting the general application of the provisions of Section 5.03, above, the provisions
of this Article IX, Section 9.06 shall survive Closing.
9.07 Time is ofthe Essence. It is expressly agreed between Buyer and Seller that time
is of the essence with respect to this Contract.
9.08 Exhibits. The Exhibits which are referenced in, and attached to this Contract, are
incorporated in and made a part of, this Contract for all purposes.
9.09 Delegation of Authority. Authority to take any actions that are to be, or may be,
taken by Buyer under this Contract, including without limitation, adjustment of the
Closing Date, are hereby delegated by Buyer, pursuant to action by the City Council of
Denton, Texas, to Phil Williams, Denton Municipal Electric, General Manager of Buyer,
or his designee.
9.10 Contract Execution. This Contract of Sale may be executed in any number of
counterparts, all of which taken together shall constitute one and the same agreement, and
any of the parties hereto may execute this Agreement by signing any such counterpart.
9.11 Business Days. If the Closing Date or the day of performance required or
permitted under this Contract falls on a Saturday, Sunday or Denton County holiday, then
the Closing Date or the date of such performance, as the case may be, shall be the next
following regular business day.
9.12 Relocation. Relocation advisory services and relocation financial assistance, if
applicable pursuant to Ordinance No. 2012 -073 (the "Relocation Ordinance "), shall be
administered as provided by the Relocation Ordinance, aside and apart from the
transaction contemplated by this Contract.
SELLER:
SERENDIPITY BUSINESS INTERESTS, LLC,
A TEXAS LIMITED LIABILITY COMPANY
By..... a ...�
Name
Title;
Executed by Seller on the day of , 2015.
Contract of Sale
Page 14 of 21
BUYER,
GEORGE C. CAMPBELL, CITY MANAGER
Executed by Buyer on the day of , 2015.
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
APPROVED AS TO LEGAL FORM;
SCOTT W. HICKEY, KELSEY, KELSEY & HICKEY, PLLC
BY:
Contract of Sale
Page 15 of 21
RECEIPT OF AGREEMENT BY TITLE COMPANY
By its execution below, Title Company acknowledges receipt of an executed copy
of this Contract. Title Company agrees to comply with, and be bound by, the terms and
provisions of this Contract and to perform its duties pursuant to the provisions of this
Contract and comply with Section 6045(e) of the Internal Revenue Code of 1986, as
amended from time to time, and as further set forth in any regulations or forms
promulgated thereunder.
TITLE COMPANY:
Title Resources, LLC
525 South Loop 288, Suite 125
Denton, Texas 76205
Telephone: (940) 381 -1006
Telecopy: (940) 898 -0121
Printed Name:
Title:
Contract receipt date: _—._., 2015
Contract of Sale
Page 16 of 21
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I1 t
ATTACHMENT "1"
to
Contract of Sale
NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL
PERSON, YOU 'MAY REMOVE OR STRIKE ANY OR ALL OF THE
FOLLOWING INFORMATION FROM ANY INSTRUMENT THAT
TRANSFERS AN INTEREST IN REAL PROPERTY BEFORE IT IS FILED FOR
RECORD IN THE PUBLIC RECORDS: YOUR - SOCIAL SECURITY NUMBER
OR YOUR DRIVER'S LICENSE NUMBER.
SPECIAL WARRANTY DEED
STATE OF TEXAS §
COUNTY OF DENTON § KNOW ALL MEN BY THESE PRESENTS
That SERENDIPITY BUSINESS INTERESTS, LLC, a Texas limited liability company,
(herein called "GRANTOR "), for and in consideration of the sum of TEN AND N01100
DOLLARS ($10.00), and other good and valuable consideration to GRANTOR in hand
paid by the City of Denton, Texas, a Texas Home Rule Municipal Corporation (herein
called "GRANTEE "), 215 E. McKinney, Denton, Texas 76201, the receipt and
sufficiency of which are hereby acknowledged and confessed, subject to the reservations
set forth below, has GRANTED, SOLD and CONVEYED, and by these presents does
GRANT, SELL and CONVEY, unto GRANTEE all the real property in Denton County,
Texas being particularly described and depicted on Exhibit "A" attached hereto and made
a part hereof for all purposes, and being located in Denton County, Texas, together with
any and all rights or interests of GRANTOR in and to adjacent streets, alleys and rights
of way and together with all and singular the improvements and fixtures thereon and all
other rights and appurtenances thereto (collectively, the "Property").
GRANTOR, subject to the limitation of such reservation made herein, reserves,
for itself, its successors and assigns all of its oil, gas and other minerals in, on and under
Contract of Sale
Page 18 of 21
and that may be produced from the Property. GRANTOR, its successors and assigns
shall not have the right to use or access the surface of the Property, in any way, manner or
form, in connection with or related to the reserved oil, gas, and other minerals and/or
related to exploration and /or production of the oil, gas and other minerals reserved herein,
including without limitation, use or access of the surface of the Property for the location
of any well or drill sites, well bores, whether vertical or any deviation from vertical,
water wells, pit areas, seismic activities, tanks or tank batteries, pipelines, roads,
electricity or other utility infrastructure, and /or for subjacent or lateral support for any
surface facilities or well bores, or any other infrastructure or improvement of any kind or
type in connection with or related to the reserved oil, gas and other minerals, and /or
related to the exploration or production of same.
As used herein, the term "minerals" shall include oil, gas and all associated
hydrocarbons, and shall exclude (i) all substances (except oil, gas and all associated
hydrocarbons) that any reasonable extraction, mining or other exploration and /or
production method, operation, process or procedure would consume, deplete or destroy
the surface of the Property; and (ii) all substances (except oil and gas) which are at or
near the surface of the Property. The intent of the parties hereto is that the meaning of
the term "minerals" as utilized herein, shall be in accordance with that set forth in Reed v.
Wylie, 597 S.W.2d 743 (Tex. 1980).
As used herein, the term "surface of the Property" shall include the area from the
surface of the earth to a depth of five hundred feet (500') below the surface of the earth
and all areas above the surface of the earth.
This conveyance is subject to the following:
(All of those Exceptions from Coverage found on Schedule B of the
Owners Title Policy to which referenced is hereby made for all purposes
and incorporated by reference as is fully set forth herein.)
TO HAVE AND TO HOLD the Property, together with all and singular the rights
and appurtenances thereto in anywise belonging unto GRANTEE and GRANTEE'S
Contract of Sale
Page 19 of 21
successors and assigns forever; and GRANTOR does hereby bind GRANTOR and
GRANTOR'S successors and assigns to WARRANT AND FOREVER DEFEND all and
singular the Property unto GRANTEE and GRANTEE'S successors and assigns, against
every person whomsoever lawfully claiming or to claim the same or any part thereof
when the claim is by, tbroug;h, or under GRANTOR but not otherwise.
EXECUTED the day of _ _ , 2015
GRANTOR:
SERENDIPITY BUSINESS INTERESTS, LLC,
A TEXAS LIMITED LIABILITY COMPANY
By:_
Name:
Title:
ACKNOWLEDGMENT
STATE OF TEXAS §
§
COUNTY OF §
This instrument was acknowledged before me on this the day of
.........._ m...._....._..._a 2015 by __.._ ._�_.. as —_e. of
SERENDIPITY BUSINESS INTERESTS, LLC, a Texas limited liability company, on behalf
of said company and in the capacity therein stated.
Upon Filing Return To:
The City of Denton - Engineering
Attn: Paul Williamson
901 -A Texas Street
Denton, TX 76209
Notary Public, State of ^__
My Commission Expires:
Contract of Sale
Page 20 of 21
Send Tax Billing Statements To:
The City of Denton
Attn: Finance Department
215 East McKinney Street
Denton, Texas 76201
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page 21 of 21
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