20-1496 - IncompleteS:\Legal\Our Documents\Ordinances\20\Ordinance Approving Consent Agreement For Olex DC MUD No 16.Docx
ORDINANCE NO.20-1496
AN ORDINANCE OF THE CITY OF DENTON, TEXAS REGARDING THE DEVELOPMENT
AND CONSENT AGREEMENT WITH VS DEVELOPMENT, LLC AND OLEX (UNITED
STATES), INC. CONCERNING THE DENTON COUNTY MUNICIPAL UTILITY DISTRICT
NO. 16 AND OTHER RELATED MATTERS; AND PROVIDING AN EFFECTIVE DATE.
WHEREAS, pursuant to Chapters 49 and 54 of the Texas Water Code and Section 42.042
of the Texas Local Government Code, Olex (United States) (“Owner”), Inc. filed a Petition for
Consent to Creation of Denton County Municipal Utility District No. 16 (“MUD”) with the City
of Denton; and
WHEREAS, the proposed MUD encompasses approximately 552.985 acres of land in
Division 2 of the City’s extenitorial jurisdiction and is contiguous to the City’s corporate
boundaries (the “Property”); and
WHEREAS, the Owner has entered into a contract to the sell the Property to VS
Development, LLC (“Developer”); and
WHEREAS, the Developer proposes to develop the Property with 1,523 residential lots, 8
acres of multifamily uses, 30 acres of commercial uses, and approximately 101 acres of
floodplain/open space with a hike/bike trails; and
WHEREAS, the City Counci1 of the City of Denton adopted Resolution No.Zo'6l3n
August 18, 2020, conditionally consenting to the creation of the MUD; and
WHEREAS, the City’s consent to the creation of the MUD is contingent upon the
Developer acquiring fee simple title to the Property by August 3 1, 2021; and
WHEREAS, the City’s consent to the creation of the MUD is contingent upon the City
Council approving an agreement that sets for the mutually agreeable terms and conditions relating
to the consent of the MUD and the development of the Property (“Development and Consent
Agreement”); and
WHEREAS, part of the consideration for the creation of the MUD is the Developer’s offer
to obligate the MUD to the terms of Development and Consent Agreement and to obligate the
MUD to approve a Strategic Partnership Agreement in which the City is guaranteed 50 percent of
the sales and use tax collected for commercial uses adjacent to and abutting U.S. Highway 380;
whereupon MUD’s failure to carry out that Strategic Partnership Agreement obligation will result
in immediate rescission of both the Development and Consent Agreement and the MUD; and
WHEREAS, it is an essential element of the granting of the City’s consent to the creation
of the MUD that, after the date on which the MUD's Board of Directors canvasses the results of
the election held within the MUD confirming the creation of the MUD, the MUD will approve and
execute both the Development and Consent Agreement and the Strategic Partnership Agreement,
and become parties to them; NOW, THEREFORE;
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS:
SECTION 1. The City Manager or his designee is hereby authorized to execute the
Development and Consent Agreement attached hereto as Exhibit “A“ with VS Development, LLC
and Olex (United States), Inc. concerning the Denton County Municipal Utility District No. 16
and other related matters.
SECTION 2. A substantial copy of the Development and Consent Agreement is attached
hereto as Exhibit “ A“ and incorporated herein for all purposes. Minor adjustments to the attached
Development and Consent Agreement are authorized, such as filling in blanks and minor
clarifications or corrections, and any modifications made by City Council in the approval of this
ordinance.
SECTION 3. The City Manager, or his designee, is further authorized to carry out all duties
and obligations to be performed by the City under the Development and Consent Agreement,
unless otherwise reserved in the Development and Consent Agreement for Council approval.
SECTION 4. This ordinance shall become effective immediately upon its passage and
approval.
The motion to approve this ordinance was made by 3 and
:: of: i:VEg V: : IT = Y1 : 1C3) 1OI} \\ ) t h e 0 r d i n 11an ce was passed and approved by
Aye
,/
vr
\/
V’
Nay Abstain Absent
Mayor Chris Watts:
Gerard Hudspeth, District 1 :
Keely G. Briggs, District 2:
Jesse Davis. District 3 :
John Ryan, District 4:V‘
Deb Armintor, At Large Place 5 :
Paul Meltzer, At Large Place 6:
PASSED AND APPROVED this,
Page 2 of 3
:::: SOS. CITY SECRETARY
BY: ./Ag .
APPROVED AS TO LEGAL FORM:
AARON LEAL. CITY ATTORNEY
Page 3 of 3
EXHIBIT “A“
DEVELOPMENT AND
CONSENT AGREEMENT
DEVELOPMENT AND CONSENT AGREEMENT CONCERNING DENTON
COUNTY MUNICIPAL UTILITY DISTRICT NO. 16
This Development and Consent Agreement Concerning Denton County Municipal
Utility District No. 16 (this " Agreement") is entered into by the City of Denton, Texas, a
Texas Home Rule municipality (the "eity"), VS Development, LLC (the “Developer“),
and Olex (United States), Inc. (the "Owner"). The Denton County Municipal Utility
District No. 16, a municipal utility district proposed pursuant to Article XVI, Section 59,
of the Texas Constitution, Chapters 49 and 54 of the Texas Water Code (the "DistHct"),
which District, after the District Confirmation Date (hereinafter defined), will become a
party to this Agreement as set forth below. The City, the Owner, the Developer, and the
District are each a "Party" and collectively the "Parties" to this Agreement. This
Agreement shall become effective on August 18, 2020 (the "Effective Date").
ARTICLE I
RECITALS
WHEREAS, the Owner is the purported owner of approximately 552.958 acres in
Denton County, Texas, as described on Exhibit A (the "Property"); and
WHEREAS, all of the Property is located in the City's extraterritorial jurisdiction
("ETJ") and contiguous to the City’s corporate boundaries; and
WHEREAS, the Owner has entered into a contract to sell the Property to the
Developer; and
WHEREAS, all of the obligations under this Agreement shall be performable by
the Developer following the Developer’s acquisition of the Property; and
WHEREAS, the Property is planned for residential, commercial, and recreational
development in accordance with the proposed plat attached as Exhibit B, which has been
filed with Denton County for review and approval; and
WHEREAS, the Owner has submitted a petition to the City to obtain the City’s
consent to the creation of the District (the "Consent Petition") in accordance with Texas
Local Government Code Section 42.042; and
WHEREAS, this Agreement is entered into pursuant to Texas Local Government
Code Section 212.172 to set out the mutually agreeable terms and conditions relating to
the development of the Property, which are the provisions under which the City has adopted
its resolution consenting to the creation of the District consistent with Texas Local
Government Code Section 42.042 and Texas Water Code Section 54.016; and
WHEREAS, part of the consideration for the creation of the proposed municipal
utility district is the Developer’s offer to obligate the District to approve a Strategic
Partnership Agreement in which the City is guaranteed 50 percent of the sales and use tax
Development and Consent Agreement Concerning
Denton County Municipal Utility District No. 16 Page 1
1230.0 12\90349.9
collected for commercial uses adjacent and abutting U.S. Highway 380; whereupon
District’s failure to carry out that obligation will entitle City and Developer to immediate
rescission of both this Agreement and the District; and
WHEREAS, the City Council of the City of Denton adopted Resolution No. 10 - \3-7 q
on August 18, 2020, conditionally consenting to the creation of the District (the "Consent
Resolution"), subject to the terms and conditions set forth in this Agreement; and
WHEREAS, it is an essential element of the granting of the City’s consent to the
creation of the District that, after the date on which the District's Board of Directors (the
"Board") canvasses the results of the election held within the District confirming the
creation of the District (the "District Confirmation Date"), the District will approve and
execute both this Agreement and the Strategic Partnership Agreement, and become parties
to them
NOW THEREFORE, for and in consideration of the mutual agreements,
covenants, and conditions hereinafter set forth, the Parties contract and agree as follows:
ARTICLE II
CITY CONSENT TO THE DISTRICT AND RELATED MATTERS
2.1 City Consent. In accordance with the terms of this Agreement, the City
conditionally consents to the creation of the District, as described in the Consent Petition
and modified by Section 2.8(d) of this Agreement, pursuant to the authority of Article III,
Section 52 and Article XVI, Section 59 of the Texas Constitution and Chapters 49 and 54,
Texas Water Code, as amended, contingent upon the District’s subsequent approval of the
Strategic Partnership Agreement providing for the collection of 50 percent of the sales and
uses taxes on the commercial uses adjacent to and abutting U.S. Highway 380. The City
reserves the right to rescind approval of this Agreement if the Strategic Partnership
Agreement fails to materialize or exist, and such rescission is not subject to Section 3.4 of
this Agreement. The District shall not convert to another type of district; consolidate with
another district; divide into two or more districts; or seek additional governmental powers
beyond those granted to the District by the TCEQ in the creation process without prior City
Council approval.
2.2 Strategic Partnership Agreement. By this Agreement and the Consent
Resolution, the Parties have committed to enter into a Strategic Partnership Agreement for
the City to collect 50 percent of the sales and use taxes on the commercial uses in the area
subject to the limited purposes annexation, which are the commercial uses adjacent to and
abutting U.S. Highway 380, and have approved the concept of the Strategic Partnership
Agreement. The City is authorized to adopt the Strategic Partnership Agreement only after
such agreement has been adopted by the Board, pursuant to Texas Local Government Code
Section 43.075 1 (e).
2.3 Execution of Agreements by District. The Developer covenants and agrees
to cause the District to approve, execute and deliver this Agreement to the City within 30
Development and Consent Agreement Concerning
Denton County Municipal Utility District No. 16 Page 2
1230.012\90349.9
days after the District Confirmation Date and to approve, execute and deliver the Strategic
Partnership Agreement to the City within 90 days after the District Confirmation Date.
2.4 Denton County Consent. The Developer shall seek consent to the creation
of the District from the Denton County Commissioners Court.
2.5 Fire Protection Plan. A Fire Protection Plan between the Developer (on
behalf of the District) and Denton County or the fire service provider shall be approved
prior to recording of a final plat of the Property.
2.6 Storm Water. The Developer will submit to the City Engineer a courtesy
copy of the downstream assessment and conditional letter of map revision (CLOMR) after
it is submitted to Denton County and before it is submitted to FEMA.
2.7 Floodplain. The Developer will comply with all US Army Corps of
Engineers permitting requirements for floodplains.
2.8 Roadways.
(a) The Developer will submit to the City Engineer a courtesy copy of
any traffic impact analysis (TIA), drive connection study or traffic signal warrant
study after it is submitted to Denton County and before it is submitted to TxDOT.
(b) All local residential streets shall have 55-feet of right of way, with
mountable curbs 31-feet from back-of-curb to back-of-curb.
(c) All roadways within the District shall be constructed with concrete
or bituminous pavement consistent with the City of Denton Transportation Design
Criteria Manual or as determined by a geotechnical pavement design for a 20-year
life span specific to this project and its soil conditions.
(d) in no instance shall there be gravel or macadamized roads or a
turnpike or other toll road as indicated in the purpose of the District provided in
Section X of the Consent Petition.
2.9 Gas Well Setbacks. Single family lots shall be setback a minimum of 200
feet from gas wells, measured in a straight line from the well head to the nearest single
family property line (an increase of 100 feet from the current minimum standard
established by the International Fire Code that governs in the City's ETJ). If a gas well is
capped, the minimum setback will be reduced from 200 feet to 20 feet. The plat attached
as Exhibit B demonstrates compliance with the minimum 200-foot setback.
2.10 Limited Purpose Annexation. The Parties agree that the City shall have the
right to annex those portions of the Property that are designated on Exhibit B as Block R,
lots 1 and 2 and Block S, lots 1 - 4 along and adjacent to U.S. Highway 380 for the sole
and limited purposes for the City to impose its sales and use tax within the boundaries of
Development and Consent Agreement Concerning
Denton County Municipal Utility District No. 16 Page 3
1230.012\90349.9
such retail areas, pursuant to Texas Local Government Code Section 43.075 1, and to enable
contiguity for continued annexation to the west of the Property, should City elect to do so
in the future. The terms and conditions upon which such limited purpose annexations may
occur shall be set forth in a Strategic Partnership Agreement. The City and the District
shall enter into a Strategic Partnership Agreement in a form substantially the same as the
form attached as Exhibit C within 90 days after the District Confirmation Date; failing
such creation, any party may rescind this Agreement, along with any consent to creation of
the District. Such rescission is not subject to Paragraph 3.4.
2.11 Multifamily and Non-Residential Properties Along US 380.
(a) Each platted lot located adjacent to US 380 that will be developed
with multi-family or nonresidential uses must comply with the Denton
Development Code regulations, in effect on the Effective Date, that are applicable
to parcels zoned Highway Commercial (HC) including, but not limited to, the
following:
• Section 3.4 Corridor Districts
•Section 3.7 Measurements and Exceptions
• Subchapter 5 Use Regulations. Any uses identified as requiring a Specific
Use Permit (SUP), would be deemed as a permitted use by right, however
any use specific standards would apply.
•Section 7.7 Landscaping, Screening Buffering, and Fences
• Section 7.8 Access and Circulation
• Section 7.9 Parking and Loading
•Section 7.10 Site and Building Design
• Section 7.11 Exterior Lighting
(b) For each platted lot located adjacent to US 380 that will be
developed with multi-family or nonresidential uses, the Developer must submit to
the City of Denton an application for a Zoning Compliance Plan for approval
consistent with those sections or subchapters listed above and build the project in
compliance with the approved plan.
2.12 Parks/Trails. The Developer will coordinate with the Parks Department
Director to ensure that the termination of the District's trail network is connected to the
City's citywide trail network.
Development and Consent Agreement Concerning
Denton County Municipal Utility District No. 16 Page 4
1230.012\90349.9
ARTICLE III
ADDITIONAL PROVISIONS
3 . 1 Incorporation of Recitals. The recitals contained in this Agreement: (a) are
true and correct as of the Effective Date; (b) form the basis upon which the Parties
negotiated and entered into this Agreement; (c) are legislative findings of the City Council,
and (d) reflect the final intent of the Parties with regard to the subject matter of this
Agreement. In the event it becomes necessary to interpret any provision of this Agreement,
the intent of the Parties, as evidenced by the recitals, shall be taken into consideration and,
to the maximum extent possible, given full effect. The Parties have relied upon the recitals
as part of the consideration for entering into this Agreement and, but for the intent of the
Parties reflected by the recitals, would not have entered into this Agreement.
3.2 Term. This Agreement shall be effective from the Effective Date and shall
continue in effect until terminated in writing by mutual agreement of the City and the
District. If the Developer has not acquired fee simple title to the Property by August 31,
202 1, this Agreement shall automatically terminate on such date and be of no further force
or effect.
3.3 Events of Default. No Party shall be in default under this Agreement until
notice of the alleged failure of such Party to perform has been given notice (which notice
shall set forth in reasonable detail the nature of the alleged failure) and until such Party has
been given a reasonable time to cure the alleged failure (such reasonable time determined
based on the nature of the alleged failure, but in no event less than 30 days after written
notice of the alleged failure has been given). In addition, no Party shall be in default under
this Agreement if, within the applicable cure period, the Party to whom the notice was
given begins performance and thereafter diligently and continuously pursues performance
until the alleged failure has been cured.
3.4 REMEDIES. IF A PARTY IS IN DEFAULT, THE AGGRIEVED PARTY
MAY, AT ITS OPTION AND WITHOUT PREJUDICE TO ANY OTHER RIGHT OR
REMEDY UNDER THIS AGREEMENT, SEEK AW RELIEF AVAILABLE AT LAW
OR IN EQUITY, INCLUDING, BUT NOT LIMITED TO, AN ACTION UNDER THE
UNIFORM DECLARATORY IUDGMENT ACT, SPECIFIC PERFORMANCE,
MANDAMUS, AND INJUNCTIVE RELIEF. NOTWITHSTANDING THE
FOREGOING, HOWEVER, NO DEFAULT UNDER THIS AGREEMENT SHALL:
(a)entitle the aggrieved Party to terminate this Agreement; or
(b) adversely affect or impair the effectiveness or validity of any consents given
by the City in this Agreement or in the Consent Resolution to the creation of the District;
or
(c) adversely affect or impair the current or future rights, powers or authority
of the District or the day-to-day administration of any of such districts; or
(d) limit the term of this Agreement.
Development and Consent Agreement Concerning
Denton County Municipal Utility District No. 16 Page 5
1230.012\90349.9
3.5 Assignment. The Developer has the right (from time to time without the
consent of the City, but upon written notice to the City) to assign this Agreement, in whole
or in part, and including any obligation, right, title, or interest of the Developer under this
Agreement, to any person or entity (an ’'Assignee") that is or will become an owner of any
portion of the Property or that is an entity that is controlled by or under common control
with Developer. Each assignment shall be in writing executed by the Developer and the
Assignee and shall obligate the Assignee to be bound by this Agreement to the extent this
Agreement applies or relates to the obligations, rights, title, or interests being assigned. A
copy of each assignment shall be provided to all Parties within 15 days after
execution. From and after such assignment, the City agrees to look solely to the Assignee
for the performance of all obligations assigned to the Assignee and agrees that the
Developer shall be released from subsequently performing the assigned obligations and
from any liability that results from the Assignee’s failure to perform the assigned
obligations. No assignment by the Developer shall release the Developer from any liability
that resulted from an act or omission by the Developer that occurred prior to the effective
date of the assignment unless the City approves the release in writing. The Developer shall
maintain written records of all assignments made by the Developer to Assignees, including
a copy of each executed assignment and the Assignee’s notice information as required by
this Agreement, and, upon written request from any Party or Assignee, shall provide a copy
of such records to the requesting person or entity. The Owner, the City and the District
shall not assign this Agreement. An Assignee shall be considered a "Party" and the
"Developer" for the purposes of the rights, title, interest, and obligations assigned to the
Assignee.
3.6 Binding Obligations. This Agreement shall be recorded in the deed records
of Denton County. This Agreement, when recorded, shall be binding upon the Parties and
their successors and assigns permitted by this Agreement and upon the Property.
3.7 Notice of Known Deficiencies. From time to time upon written request of
the Developer or the District, the City Manager will execute a written notice of known
deficiencies identifying any obligations of the Developer under this Agreement that are in
default or, with the giving of notice or passage of time, would be in default; and stating, to
the extent true, that to the best knowledge and belief of the City, the Developer is otherwise
in compliance with its duties and obligations under this Agreement.
3.8 Notices. All notices required or contemplated by this Agreement (or
otherwise given in connection with this Agreement) shall be in writing, shall be signed by
or on behalf of the Party giving the Notice, and shall be effective as follows: (a) on or after
the 10th business day after being deposited with the United States mail service, Certified
Mail, Return Receipt Requested with a confirming copy sent by E-mail; (b) on the day
delivered by a private delivery or private messenger service (such as FedEx or UPS) as
evidenced by a receipt signed by any person at the delivery address (whether or not such
person is the person to whom the notice is addressed); or (c) otherwise on the day actually
received by the person to whom the Notice is addressed, including, but not limited to,
delivery in person and delivery by regular mail (with a confirming copy sent by E-mail).
Notices given pursuant to this section shall be addressed as follows:
Development and Consent Agreement Concerning
Denton County Municipal Utility District No. 16 Page 6
1230.0 12\90349.9
To the City:City of Denton
Ann: City Manager
215 E. McKinney St.
Denton, Texas 76201
Fax: (940) 382-7923
Email: Todd.Hileman(a}cit)'ofdenton.com
With a copy to:City of Denton
Ann: City Attorney
215 E. McKinney St.
Denton, TX 76201
Email: Aaron.Leal(a}cityofdenton.com
To the District:Denton County Municipal Utility District No. 16
Ann: President, Board of Directors
c/o Coats Rose, P.C.
9 Greenway Plaza, Suite 1000
Houston, Texas 77046
Email: tgreen@coatsrose.com
With a copy to:Attn: Tim Green
Coats Rose, P.C.
9 Greenway Plaza, Suite 1000
Houston, Texas 77046
Email: tgreen@coatsrose.com
To the Owner:Atm: Lars Springman
Olex (United States), Inc.
6440 N. Central Expressway, Suite 401
Dallas, TX 76206
To the Developer:Attn: Bob Shelton
VS Development, LLC
2925 Country Club Drive, #105
Denton, Texas 76210
Email: bobshelton@sheltonent.com
With a copy to:Ann: Misty Ventura
Shupe Ventura, PLLC
9406 Biscayne Blvd.
Dallas, Texas 75218
Email: misty.ventura@svlandlaw.com
3.9 Interpretation. The Parties acknowledge that each of them has been actively
involved in negotiating this Agreement. Accordingly, the rule of construction that any
Development and Consent Agreement Concerning
Denton County Municipal Utility District No. 16 Page 7
1230.012\90349.9
ambiguities are to be resolved against the drafting Party will not apply to interpreting this
Agreement. In the event of any dispute over the meaning or application of any provision
of this Agreement, the provision will be interpreted fairly and reasonably and neither more
strongly for or against any Party, regardless of which Party originally drafted the provision.
3.10 Authority. The City represents and warrants that this Agreement has been
approved by ordinance duly adopted by the City Council in accordance with all applicable
public notice requirements (including, but not limited to, notices required by the Texas
Open Meetings Act) and that the individual executing this Agreement on behalf of the City
has been duly authorized to do so. The Developer represents and warrants that this
Agreement has been approved by appropriate action of the Developer, and that the
individual executing this Agreement on behalf of the Developer has been duly authorized
to do so. The District represents and warrants that this Agreement has been approved and
duly adopted by the Board in accordance with all applicable public notice requirements
(including, but not limited to, notices required by the Texas Open Meetings Act) and that
the individual executing this Agreement on behalf of the District has been duly authorized
to do so
3.11 Entire Agreement; Amendment. This Agreement constitutes the entire
agreement between the Parties and supersedes all prior agreements, whether oral or written,
covering the subject matter of this Agreement. This Agreement shall not be modified or
amended except in writing signed by the Parties.
3.12 Severability. If any provision of this Agreement is determined by a court
of competent jurisdiction to be unenforceable for any reason, then (a) such unenforceable
provision shall be deleted from this Agreement; (b) the unenforceable provision shall, to
the extent possible, be rewritten to be enforceable and to give effect to the intent of the
Parties; and (c) the remainder of this Agreement shall remain in full force and effect and
shall be interpreted to give effect to the intent of the Parties as reflected in the recitals.
3.12 Applicable Law; Venue. This Agreement is entered into under and pursuant
to, and is to be construed and enforceable in accordance with, the laws of the State of Texas,
and all obligations of the Parties are performable in Denton County. Venue for any action
to enforce or construe this Agreement shall be in Denton County.
3.13 Non Waiver. Any failure by a Party to insist upon strict performance by
another 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 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.
3.14 No Third Party Beneficiaries. This Agreement only inures to the benefit of,
and may only be enforced by, the Parties.
Development and Consent Agreement Concerning
Denton County Municipal Utility District No. 16 Page 8
1230.0 12\90349.9
3.15 Form 1295. Submitted herewith is a completed Form 1295 generated by the
Texas Ethics Commission’s (the '’TEC") electronic filing application in accordance with
the provisions of Section 2252.908 of the Texas Government Code and the rules
promulgated by the TEC (the "Form 1295"). The City hereby confirms receipt of the Form
1295 from the Owner and the Developer, and the City agrees to acknowledge such form
with the TEC through its electronic filing application not later than the 30th day after the
receipt of such form. The Parties understand and agree that, with the exception of
information identifying the City and the contract identification number, neither the City
nor its consultants are responsible for the information contained in the Form 1295; that the
information contained in the Form 1295 has been provided solely by the Owner; and,
neither the City nor its consultants have verified such information.
3.16 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and constitute one and the same
rnstrurnent.
3.17 Further Documents. Each Party shall, upon request of the other Party,
execute and deliver such farther documents and perform such further acts as may
reasonably be requested to effectuate the terms of this Agreement and achieve the intent of
the Parties.
3.18 Exhibits. The following Exhibits are attached to this Agreement and are
incorporated herein for all purposes:
Exhibit A
Exhibit B
Exhibit C:
Metes and Bounds Description of the Property
Plat
Strategic Partnership Agreement Form
Development and Consent Agreement Concerning
Denton County Municipal Utility District No. 16 Page 9
1230.0 12\90349.9
IN WITNESS WHEREOF, each Party has caused this Agreement to be executed
by its undersigned duly authorized representative.
ATTEST :CITY OF DENTON
ROSA RIOS, CITY SECRETARY
::t:: C'ty Mayrirq /tO'to
N'a;Me mRB1
STATE OF TEXAS §
COUNTY OF DENTON §
Thi, i„,t„,m,„t w„ „k„,wl,dg,d b,f„, m, ,n aq®\ le 2020 by T,dd
Hileman, City Manager of the City of Denton, Texas on behalf of said city.
$
KARISALEIGH
MyMWyD#13188791 1
ExhB$b®nbH14,aor H Notat
APPROVED AS TO FORM:
Development and Consent Agreement Concerning
Denton County Municipal Utility District No. 16 Page 10
1230.012\90349.9
OLEX (UNITED STATES), INC
a Del
aBy
Name: Lars Spri;1&In
Title: President
STATE OF TEXAS §
§
§COUNTY OF DENTON
This instrument was acknowledged before me, on the iq day
2020, by Lars Springman, President of Olex (United States),
corporation, on behalf of said corpo 'ation
UIWHy D # laBels
DgaHa81& aaa
Notary Public, State of Texas
Printed Name: T &o,e F\A,_\, cA
My Commission Expires:+aIda
[SEAL]
Development and Consent Agreement Concerning
Denton County Municipal Utility District No. 16 Page ! !t 230 01 2\90349.9
VS Development, LLC
a Texas limited liability companya
STATE OF TEXAS §
§
§COUNTY OF DENTON
This instrument was acknowledged before me, on the
2020, by IM
LLC, a Texas limited liability company.
B>al$41Ul n/W
Le of Tex;Notary Public,
[SEAL]
DEBBIE J. THOMPSON
NotarY Public, State of Texas
Comm. Expires 07-24.2024
Notary ID 132588350
Development and Consent Agreement Concerning
Denton County Municipal Utility District No. 16 Page 12
1230.012\90349.9
Following the District Confirmation Date, the District has executed the Agreement.
DENTON COUNTY MUNICIPAL UTILITY
DISTRICT NO. 16
By:
President, Board of Directors
Date :
STATE OF TEXAS §
§
q
COUNTY OF DENTON §
This instrument was acknowledged before me, on the day of
20 , by , President of the Board of Directors of Denton
County Municipal Utility District No. 16 on behalf of said District.
Notary Public, State of Texas
Printed Name:
My Commission Expires:
[SEAL]
Development and Consent Agreement Concerning
Denton County Municipal Utility District No. 16 Page 13
1230.0 12\90349.9
Exhibit A
Metes and Bounds Description of the Property
Tract 1
144.086 Acres
BEING a tract of land situated in the Uberto AIIen Survey, Abstract No. 14, William
Stonham Survey, Abstract No. 1145 and the Harris Young Survey, Abstract No. 1450,
Denton County, Texas and being the remaining portion of a called Tract One (153.488-
acres) described in a General Warranty Deed to Olex (United States), Inc., f/k/a Olex
Corporation N. V., recorded in Volume 1 129, Page 185, Deed Records of Denton County,
Texas, and being more particularly described by metes and bounds as follows:
BEGINNING at an aluminum TXDOT right of way disk found on the westerly line of said
Tract One (153.488-acres), for the northwest corner of a called Parcel 17, described in an
Agreed Judgment to the State of Texas, recoded in Instrument No. 2012-80554, Official
Records of Denton County, Texas, same being the northeast corner of a called Parcel 16,
described in a Deed to the State of Texas, recorded in Instrument No. 2009-71718, Official
Records of Denton County, Texas, same also being the current northerly right of way line
of U. S. Highway 380, a variable width right of way;
THENCE North 00'>02'22'’ West, departing the northerly right of way line of said U. S.
Highway 380, along the westerly line of said Tract One (153.488-acres) and generally
along a barbed wire fence, a distance of 2,236.16 feet to a metal fence corner post found
for the northwest corner of said Tract One (153.488-acres), same being the southwest
corner of a called 1 .93 1-acre tract of land, described in a Special Warranty Deed to Vangard
Wireless, LP, recorded in Instrument No. 2005-79339, Official Records of Denton County,
Texas
THENCE South 89'’58'24" East, along the northerly line of said Tract One (153.488-
acres), the southerly line of said 1.931-acre tract, the southerly line of a called 5.00-acre
tract of land, described in a Warranty Deed to Amanda Noles Nelson, recorded in
Instrument No. 2013-92845, Official Records of Denton County, Texas, the southerly line
of a called 19.6390-acre tract of land, described in a Special Warranty Deed to Nancy Kay
Jones, recorded in Instrument No. 20 10-57685, Official Records of Denton County, Texas,
the southerly line of Myers Farm, an addition to the City of Denton, according to the final
plat, recorded in Document No. 2011-77, Plat Records of Denton County, Texas, and
generally along a barbed wire fence, a distance of 2091.05 feet to a 1/2-inch iron rod with
a yellow plastic cap found for the southeast corner of said Myers Farm, same being the
southwest corner of called 21.1455-acre tract of land described in a Special Warranty Deed
to Janis June Myers, recorded in Instrument No. 2010-57683, Official Records of Denton
County, Texas;
THENCE South 89'’53'09" East, continuing along the northerly line of said Tract One
( 153.488-acres), the southerly line of said 21.1455-acre tract, and generally along a barbed
Exhibit A – Page 1
1230.012\90349.9
wire fence, a distance of 1368.48 feet to a 1/2-inch iron rod found for the northeast corner
of said Tract One (153.488-acres) and the southeast corner of said 2 1.1455-acre tract, same
being on the westerly right of way line ofF. M. 156, a variable width right of way;
THENCE South 17'28'47" West, along the easterly line of said Tract One (153.488-acres)
and the westerly right of way line of said F. M. 156, a distance of 94.26 feet to a 5/8-inch
iron rod with a red plastic cap, stamped "KHA" set at the beginning of a non-tangent curve
to the right having a central angle of 15'’08'00", a radius of 5659.58 feet, a chord bearing
and distance of South 21'’13'35" West, 1490.50 feet, from said point, a wooden right of
way marker bears South 13'42’ West, 3.93 feet;
THENCE in a southwesterly direction, continuing along the easterly line of said Tract One
(153.488-acres) and the westerly right of way line of said F. M. 156, along said curve to
the right, an arc distance of 1494.85 feet to a 5/8-inch iron rod with a red plastic cap,
stamped '’KHA" set for corner, from which, a wooden right of way marker bears South
03'’03’ West, 1.20 feet;
THENCE South 28'47'35" West, continuing along the easterly line of said Tract One
(153.488-acres) and the westerly right of way line of said F. M. 156, a distance of 556.36
feet to an aluminum TXDOT right of way disk found for the northeast comer of aforesaid
Parcel 17, same being the intersection of the westerly right of way line of said F. M. 156
with the northerly right of way line of aforesaid U. S. Highway 380;
THENCE in a westerly direction, departing the westerly right of way line of said F. M.
156, along the northerly line of said Parcel 17 and the northerly right of way line of said
U. S. Highway 380, the following:
North 61'04’40" West, a distance of 679.63 feet to an aluminum TXDOT right of
way disk found for comer;
South 78'35'46" West, a distance of 296.07 feet to an aluminum TXDOT right of
way disk found for corner;
South 38'16'12" West, a distance of 548.81 feet to an aluminum TXDOT right of
way disk found for corner;
South 62'08'29" West, a distance of 218.57 feet to an aluminum TXDOT right of
way disk found for corner;
South 86Q00'46" West, a distance of 322.43 feet to an aluminum TXDOT right of
way disk found for corner;
North 90'00'00" West, a distance of 469.04 feet to an aluminum TXDOT right of
way disk found for corner;
Exhibit A – Page 2
1230.012\90349.9
North 87'’16'23" West, a distance of 413.60 feet to the POINT OF BEGINNING
and containing 144.086 acres (6276387 square feet) of land, more or less.
Tract 2
408.899 Acres
BEING a tract of land situated in the George W. Anderson Survey, Abstract No. 12,
Uberto AIIen Survey, Abstract No. 14, Edward F. Anderson Survey, Abstract No. 16, B.
B. B & C. RR. Co. Survey, Abstract No. 168, B. B. B & C. RR. Co. Survey, Abstract No.
188, William Stonham Survey, Abstract No. 1145 and the Harris Young Survey, Abstract
No. 1450, Denton County, Texas and being the remaining portion of a called Tract Three
(425.898-acres) described in a General Warranty Deed to Olex (United States), Inc., f/k/a
Olex Corporation N. V., recorded in Volume 1 129, Page 185, Deed Records of Denton
County, Texas, and being more particularly described by metes and bounds as follows:
BEGINNING at an aluminum TXDOT right of way disk found on the easterly line of
said Tract Three (425.898-acres), for the southeast corner of a called Parcel 15, described
in an Agreed Judgment to the State of Texas, recoded in Instrument No. 2012-80554,
Official Records of Denton County, Texas, same being the intersection of the current
southerly right of way line of U. S. Highway 380, a variable width right of way with the
westerly right of way line ofF. M. 156, a variable width right of way;
THENCE in a southerly direction, departing the southerly right of way line of said U. S.
Highway 380, along the easterly line of said Tract Three (425.898-acres) and the westerly
right of way line of said F. M. 156, the following:
South 28'>45'02" West, a distance of 581.24 feet to a 5/8-inch iron rod with a red
plastic cap, stamped ’'KHA" set at the beginning of a tangent curve to the right
having a central angle of 03'’49’00", a radius of 5659.58 feet, a chord bearing and
distance of South 30a39’32" West, 376.93 feet;
in a southwesterly direction, along said curve to the right, an arc distance of
377.00 feet to a 5/8-inch iron rod with a red plastic cap, stamped "KHA" set for
corner ;
South 27'’44'04'’ West, a distance of 1 18.70 feet to a 5/8-inch iron rod with a red
plastic cap, stamped ’'KHA" set for corner, from which, a wooden right of way
marker bears South 44'’02’ West, 3.82 feet;
South 32'>34'02" West, a distance of 1000.02 feet to a 5/8-inch iron rod with a red
plastic cap, stamped ’'KHA" set for corner, from which, a wooden right of way
marker bears South 42Q17’ West, 2.01 feet;
South 38'’16’40" West, a distance of 100.50 feet to a 5/8-inch iron rod with a red
plastic cap, stamped "KHA" set for corner, from which, a wooden right of way
marker bears South 44'>22’ West, 2.44 feet;
Exhibit A – Page 3
1230.0 12\90349.9
South 32c’34'02" West, a distance of 1900.00 feet to a 5/8-inch iron rod with a red
plastic cap, stamped ’'KHA" set for corner, from which, a wooden right of way
marker bears South 27'02’ West, 8.82 feet;
South 26')51’24" West, a distance of 100.50 feet to a 5/8-inch iron rod with a red
plastic cap, stamped "KHA" set for corner;
South 32<)34’02" West, a distance of 924.50 feet to a 5/8-inch iron rod with a red
plastic cap, stamped ’'KHA" set for the beginning of a tangent curve to the left
having a central angle of6<)27'51", a radius of 2924.79 feet, a chord bearing and
distance of South 29'’20'06" West, 329.80 feet;
in a southwesterly direction, with said curve to the left, an arc distance of 329.97
feet to a PK nail with a washer, stamped "KHA" set in an asphalt road, known as
Old Stoney Road, an apparent public use roadway, no record found, for the
southeast corner of said Tract Three (425.898-acres);
THENCE South 89c)39’42" West, departing the westerly right of way line of said F. M.
156, along the southerly line of said Tract Three (425.898-acres) and along said Old
Stoney Road, a distance of 1706.19 feet to a 1/2-inch iron rod found for the southwest
corner of said Tract Three (425.898-acres);
THENCE North 0'02'12'’ West, departing said Old Stoney Road and along the westerly
line of said Tract Three (425.898-acres), a distance of 5443.65 feet to a 5/8-inch iron rod
with a red plastic cap, stamped "KHA" set on the southerly line of a called Parcel 14,
described in a Deed to the State of Texas, recorded in Instrument No. 2008-19039.
Official Records of Denton County, Texas, same being the current southerly right of way
line of aforesaid U. S. Highway 380;
THENCE in an easterly direction, departing the westerly line of said Tract Three
(425.898-acres) and along the southerly right of way line of said U. S. Highway 380, the
following:
South 87'’16’23" East, passing at a distance of 8.26 feet, an aluminum TXDOT
right of way disk found for the south common corner of said Parcel 14 and
aforesaid Parcel 15, continuing for a total distance of 1274.95 feet to a point for
corner ;
North 63'’54'58" East, a distance of 83.00 feet to a 5/8-inch iron rod with a red
plastic cap, stamped "KHA" set for corner;
South 87'’16'24" East, a distance of 299.75 feet to a 5/8-inch iron rod with a red
plastic cap, stamped "KHA" set for corner;
Exhibit A – Page 4
1230.012\90349.9
North 88'’52' ll " East, a distance of 1520.81 feet to a 5/8-inch iron rod with a red
plastic cap, stamped “KHA" set for corner;
North 90'’00'00'’ East, a distance of 160.25 feet to a 5/8-inch iron rod with a red
plastic cap, stamped "KHA" set for corner;
South 85'’24'02'’ East, a distance of 457.49 feet to a 5/8-inch iron rod with a red
plastic cap, stamped "KHA" set for corner;
South 55'’26’56" East, a distance of 259.95 feet to an aluminum TXDOT right of
way disk found for corner;
South 25'’29'50" East, a distance of 449.43 feet to an aluminum TXDOT right of
way disk found for corner;
South 61'’21’38" East, a distance of 239.94 feet to a 5/8-inch iron rod with a red
plastic cap, stamped '’KHA" set for corner;
South 54'’3 1 '02" East, a distance of 100.71 feet to an aluminum TXDOT right of
way disk found for corner;
South 61'21'39" East, a distance of 91.38 feet to the POINT OF BEGINNING
and containing 408.899 acres (17811656 square feet) of land, more or less.
Exhibit A – Page 5
1230.012\90349.9
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EXHIBIT C
STRATEGIC PARTNERSHIP AGREEMENT BY AND BETWEEN
THE CITY OF DENTON, TEXAS AND
DENTON COUNTY MUNICIPAL UTILITY DISTRICT NO. 16
STATE OF TEXAS §
§
§COUNTY OF DENTON
This Strategic Partnership Agreement (this “Agreement”) is entered into by the City of
Denton, Texas, a home rule municipality situated in Denton County, Texas (the “City”), and
Denton County Municipal Utility District No. 16, a political subdivision of the State of Texas,
acting by and through its duly authorized Board of Directors (the “District”), under the authority
of Section 43.0751 of the Texas Local Government Code (the “Local Government Code”).
RECITALS
WHEREAS, Local Government Code Section 43.0751 (the “Act”) authorizes the City and
the District to negotiate and enter into a strategic partnership agreement by mutual consent; and
WHEREAS, the District encompasses approximately 552.958 acres, all of which is within
the City’s extraterritorial jurisdiction and contiguous to the City’s corporate boundaries, described
by metes and bounds and depicted on Exhibit “A“ (the “Property”); and
WHEREAS, the City desires to annex certain portions of the Property that have been or
may in the future be designated for commercial use for limited purposes for the purpose of
collecting Sales and Use Tax Revenues (hereinafter defined); and
WHEREAS, subject to the terms of the Agreement, the District consents to the City
annexing the commercial use areas of the Development for the sole and exclusive purpose of
imposing and collecting sales and use taxes within such areas; and
WHEREAS, pursuant to the Act, the Parties desire to enter into this Agreement to
accomplish the annexation by the City for the sole and exclusive purpose of imposing and
collecting sales and use taxes within the commercial use areas of the Limited Purpose Property
(bereinafter defined); and
WHEREAS, pursuant to this Agreement, the City will pay to the District an amount equal
to a portion of such Sales and Use Tax Revenues (hereinafter defined), which may be used by the
District to fund the installation and construction of infrastructure and for other purposes as set forth
in Section 4.3 of this Agreement; and
WHEREAS, the City and the District acknowledge that this Agreement provides benefits
to each party, including revenue, services and regulatory benefits.
Page C- 1 of C- 13
1230.012\90719.4
NOW, THEREFORE, for and in consideration of the mutual agreements, covenants and
conditions contained in this Agreement, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the City and the District agree as follows :
ARTICLE 1
FINDINGS
A. The District is a municipal utility district encompassing, in part, approximately
552.958 acres that is within the City’s extratenitorial jurisdiction.
B . The District was created by the Texas Commission on Environmental Quality (the
“TCEQ”), pursuant to Article XVI, Section 59, and Article III, Section 52(b)(3), of the Texas
Constitution, and Chapters 49 and 54 of the Texas Water Code, as amended.
C. On August 18, 2020, the City Council adopted Resolution No.
consenting to the creation of the District (the “Consent Resolution”).
D. The District provided notice of two public hearings concerning the adoption of this
Agreement following the District’s notification procedures for other matters of public importance,
in accordance with the procedural requirements of the Act.
E. The Board of Directors of the District conducted two public hearings regarding this
Agreement, at which members of the public who wished to present testimony or evidence
regarding this Agreement and the proposed limited purpose annexation were given the opportunity
to do so, in accordance with the procedural requirements of the Act, on , 202 , at
p.m. at , and on , 202_, at p.m. at
F. The Board of Directors of the District adopted and approved this Agreement on
, 202_, in open session at a meeting held in accordance with Chapter 551 of the
Texas Government Code.
G. The City provided notice of two public hearings concerning the adoption of this
Agreement by publishing said notices in a newspaper of general circulation in the City and in the
District, in accordance with the procedural requirements of the Act.
H. The City Council conducted two public hearings regarding this Agreement, at
which members of the public who wished to present testimony or evidence regarding this
Agreement and the proposed limited purpose annexation were given the opportunity to do so, in
accordance with the procedural requirements of the Act, on , 202 , at p.m. at
the City Council Chambers, and on , 202_, at p.m. at the City Council Chambers.
I. The City Council adopted and approved this Agreement on , 202 , in
open session at a meeting held in accordance with Chapter 551 of the Texas Government Code,
which approval occurred after the Board of Directors of the District approved this Agreement.
Page C-2 of C-13
1230.012\90719.4
J. All procedural requirements imposed by law for the adoption of this Agreement
have been met.
K. In accordance with the requirements of Subsection (p)(2) of the Act, this Agreement
provides benefits to the City and the District, including revenue, services and regulatory benefits
which are reasonable and equitable with regard to the benefits provided to the other.
L. The Act authorizes the City and the District to enter into this Agreement to define
the terms under which services, if any, will be provided to City and the District and under which
the District will continue to exist after the Property is annexed for limited purposes pursuant to
this Agreement.
M. This Agreement does not require the District to provide revenue to the City solely
for the purpose of an agreement with the City to forgo annexation of the District.
N. All the terms contained in this Agreement are lawful and appropriate to provide for
the provision of municipal services.
O. The City and the District negotiated this Agreement by mutual consent; the terms
of the Agreement are not a result of the City’s annexation plan or any arbitration between the City
and District.
ARTICLE II
DEFINITIONS
Terms used in this Agreement shall have the following meanings:
“Act“ means the Texas Local Government Code, Section 43.0751, and any amendments
thereto .
“Agreement“ means this Strategic Partnership Agreement between the City and the
District.
“Board of Directors” means the Board of Directors of the District.
“City” means the City of Denton, Texas, a home rule municipality of the State of Texas.
“City Manager” means the chief administrative employee of the City, or his or her
authorized designee.
“City Council” means the City Council of the City.
“City Share” means the City’s share of the Sales and Use Tax Revenues as defined by
Section 4.2 of this Agreement.
Page C-3 of C-13
1230.012\90719.4
“Commercial Property” means those certain tracts within the District that are adjacent and
abutting U.S. Highway 380, which tracts are within the City’s ETJ.
“Comptroller” means the Comptroller of Public Accounts for the State of Texas.
“Consent Resolution” means the City’s Resolution No. consenting to the
creation of the District.
“Development and Consent Agreement” means the Development and Consent Agreement
effective August 18, 2020, regarding development of the Property.
“District” means Denton County Municipal Utility District No. 16.
“District Share“ means the District’s share of the Sales and Use Tax Revenues as defined
by Section 4.2 of this Agreement.
“ETJ” means the extraterritorhl jurisdiction of a city as defined by the Local GovenIment
Code, as amended.
“Effective Date” means the date on which the City adopts this Agreement, after it has been
approved, adopted, and executed by the District.
“Government Code” means the Texas Government Code, as amended.
“Implementation Date” means the date the limited-purpose annexation ordinance is passed
by City Council pursuant to Section 3.4, 3.5, and 3.6.
“Limited Purpose Annexation Period” means the period commencing on the effective date
of the limited purpose annexation of the Limited Purpose Property and ending upon the full
purpose annexation or disannexation of such property.
“Limited Purpose Property” means the property in the District that is within the City’s
ETJ and is annexed pursuant to Section 3.4, 3.5, and 3.6.
“Local Government Code” means the Texas Local Government Code, as amended.
“Notice” means notice as defined in Section 9.1 of this Agreement.
“Party” means, individually, the City or the District, their successors and assigns as
permitted by Section 8.8 of this Agreement.
“Property” means the approximately 552.958 acres located partially within the City’s
extraterritorial jurisdiction, described by metes and bounds and depicted on Exhibit “A.”
“Sales and Use Tax Revenues“ means those revenues received by the City from the sales
and use tax authorized to be imposed by the City on sales consummated at locations within the
Page C-4 of C-13
1230.012\90719.4
Limited Purpose Property pursuant to the Act and Chapter 321 of the Tax Code and whose use is
not otherwise controlled or regulated, in whole or in part, by another governmental entity,
authority or applicable law, ordinance, rule or regulation.
“Tax Code“ means the Texas Tax Code, as amended.
ARTICLE III
ADOPTION OF AGREEMENT AND
LIMITED PURPOSE ANNEXATION OF COMMERCIAL PROPERTY
3. 1 Public Hearings. The District and the City acknowledge and agree that prior to the
execution of this Agreement, the governing bodies of the District and the City have conducted two
public hearings for the purpose of considering the adoption of this Agreement and that such
hearings were noticed and conducted in accordance with the terms of the Act, this Agreement and
Chapter 551 of the Government Code.
3.2 Effective Date. Pursuant to Subsection (c) of the Act, this Agreement is effective
on the date of adoption of this Agreement by the City.
3.3 Filing in Property Records. The District shall file this Agreement in the Real
Property Records of Denton County, Texas. This Agreement binds each owner and future owner
of land included within the District’s boundaries in accordance with Subsection (c) of the Act.
3.4 Limited Purpose Annexation of Commercial Property. The District and the City
agree that the City may annex all or any portion of the Commercial Property for the limited purpose
of collecting Sales and Use Tax Revenues within the Commercial Property pursuant to Subsection
(k) of the Act. The District acknowledges that the City Council may adopt one or more limited
purpose annexation ordinances at one or more meetings conducted in accordance with Chapter 551
of the Government Code and further acknowledges that no additional notices, hearings or other
procedures are required by law in order to approve such limited purpose annexations. The City
may annex for limited purposes any portion of the Commercial Property at any time after Owner,
or any subsequent owner of the Commercial Property, submits a final plat for such property to the
City
3.5 Limited Purpose Annexation of Additional Commercial Property. If in the future
any non-commercial land within the District as of the Effective Date is converted to any
commercial use, the District and the City agree that the City may annex such additional
commercial land (the “Additional Commercial Property”) for the sole and exclusive purpose of
imposing Sales and Use Tax Revenues within the Additional Commercial Property, pursuant to
this Agreement. The District acknowledges and agrees that the City Council may adopt a limited
purpose annexation ordinance applicable to the Additional Commercial Property at a meeting
conducted in accordance with Chapter 551 of the Texas Government Code and that no further
notices, hearings, or other procedures shall be required to adopt such limited purpose annexation
ordinance. The City may annex for limited purposes any portion of the Commercial Property at
any time after Owner, or any subsequent owner of the Commercial Property, submits a final plat
for such property to the City.
Page C-5 of C- 13
1230.012\90719.4
3.6 Limited Purpose Annexation of Connecting Land. The District and the City further
agree that the City may limited purpose annex additional land within the District (up to a
maximum width of 1,001 feet) as reasonably necessary to connect the Commercial Property or
Additional Commercial Property to the corporate or extraterritorial limits of the City (the
“Connecting Limited Purpose Property”). The City may annex Connecting Limited Purpose
Property for the sole and exclusive purpose of imposing sales and use taxes pursuant to this
Agreement. The District acknowledges and agrees that the City Council may adopt a limited
purpose annexation ordinance applicable to the Connecting Limited Purpose Property at a
meeting conducted in accordance with Chapter 551 of the Texas Government Code and that no
further notices, hearings, or other procedures shall be required to adopt such limited purpose
annexation ordinance.
3.7 Limited Purpose Property and Sales and Use Tax Revenues. For purposes of this
Agreement, the Commercial Property, Additional Commercial Property, and Connecting Limited
Purpose Property shall collectively be referred to as the “Limited Purpose Property”; and the sales
and use taxes collected within the Limited Purpose Property shall be referred to as the “Sales and
Use Tax Revenues“.
3.8 Consent to Limited Purpose Annexation. The District, on behalf of itself and all
present and future owners of land within the District, hereby requests that the City annex the
Limited Purposes Property for limited purposes as provided in this Agreement. The District
expressly consents to annexation, from time to time, and to the collection of Sales and Use Tax
Revenues by the City within such Limited Purpose Property. Such consent shall bind the District
and all current and fbture owners of land within the District.
ARTICLE IV
TAXATION AND PROVISIONS OF SERVICES
4. 1 Collection of Sales and Use Tax Revenues. The City may impose a sales and use
tax within the Limited Purpose Property pursuant to Subsection (k) of the Act. The sales and use
tax shall be imposed on all eligible commercial activities at the rate allowed under the Tax Code
and imposed by the City. Collection of the Sales and Use Tax Revenues shall take effect on the
date described in Section 321.102 of the Tax Code.
4.2 Payment of Sales and Use Tax. In return for the benefits received by the City
pursuant to this Agreement, the City shall pay to the District an amount equal to 50% of the Sales
and Use Tax Revenues collected within the Limited Purposes Property commencing upon the
effective date of the limited purpose annexation of the Limited Purpose Property. All amounts
payable to the District are hereafter referred to as the “District Share.“ The City shall pay the
District Share within 30 days after the City receives the sales tax report reflecting such revenue
from the Comptroller. Any payment of the District Share not made within such 30 day period
shall bear interest calculated in accordance with Section 2251.025 of the Government Code. The
City shall retain all Sales and Use Tax Revenues that do not constitute the District Share (the “City
Share”)
Page C-6 of C-13
1230.012\90719.4
4.3 Use of the Sales and Use Tax Revenues. The District may use the District Share
for any lawful purpose. The City may use the City Share for any lawful purpose.
4.4 Delivery of Sales Tax Reports to District. The City shall deliver to the District a
condensed version of each monthly area sales tax report provided by the Comptroller, containing
only the contents of the sales tax report relating to retail sales and retailers in the Property within
30 days of City’s receipt of the sales tax report.
4.5 Notification of Comptroller. The City shall send notice of this Agreement, together
with other required documentation, to the Comptroller in the manner provided by Section 321.102
of the Tax Code, after the City Council annexes any portion of the Limited Purpose Property for
limited purposes.
4.6 Termination of Sales and Use Tax Sharing. Upon termination of this Agreement,
the City shall have no further financial obligation to the District pursuant to this Agreement.
4.7 City Audit Rights. The District is required by law to prepare an annual audit within
120 days after the close of the District’s fiscal year, subject to the exemptions provided under
Section 49.198 of the Texas Water Code allowing for the District to file annual financial reports
with the executive director of the TCEQ in lieu of conducting an annual audit if it meets certain
criteria. The District shall provide a copy of its annual audit or annual financial report to City
within 30 days after the audit or financial report is completed. City may audit the District’s
expenditures made with the Sales and Use Tax revenue paid under Section 4.2, solely to determine
whether the expenditures have been made by the District in accordance with Section 4.3. Any audit
shall be made at City’s sole cost and expense and may be performed at any time during regular
business hours by City’s internal auditors or an independent auditing firm on 30 days written notice
to the District. For the purpose of any audits made by the City, the District shall maintain and make
available to City or its representatives all books, records, documents and other evidence of
accounting procedures or practices in whatever form maintained sufficient to reflect the
expenditure of all Sales and Use Tax revenues that are subject to this Agreement.
ARTICLE V
TERM
This Agreement commences and binds the Parties on the Effective Date and continues until
the City annexes the Limited Purpose Property for full purposes or disannexes the Limited Purpose
Property. Any rights or privileges of the Parties and their successors or assigns under this
Agreement will terminate upon the expiration or termination of this Agreement. If the City elects
to annex the Limited Purpose Property for full purposes or disannex the Limited Purpose Property,
the City will provide written notice to the District at least 180 days before such annexation or
disannexation. If the District elects to dissolve, it shall provide written notice to the City at least
180 days before the dissolution.
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1230.012\90719.4
ARTICLHKVII
BREACH, NOTICE AND REMEDIES
7. 1 Notification of Breach. If either Party commits an alleged breach of this
Agreement, the non-breaching Party shall give Notice to the breaching Party that describes the
alleged breach in reasonable detail. A Party receiving such Notice shall determine (i) whether a
failure to comply with a provision has occurred; (ii) whether the failure is excusable; and (iii)
whether the failure has been cured or will be cured by the purportedly breaching Party. The Parties
shall make available to each other such records, documents, or other information necessary to
make these determinations upon reasonable written request.
7.2 Cure of Breach. The breaching Party shall commence curing such breach within
15 calendar days after receipt of Notice of the breach and shall complete the cure within 30
calendar days from the date of commencement of the cure; however, if the breach is not reasonable
susceptible to cure by the breaching Party within such 30 day period, the non-breaching Party shall
not bring any action so long as the breaching Party has commenced to cure the breach within such
30 day period and diligently completes the cure within a reasonable time without unreasonable
cessation. A Party providing Notice of a breach may provide for a longer period of time to cure
the alleged failure within its written notice
7.3 Remedies for Breach. If the breaching Party does not cure such material 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 relief available at law or in
equity, including, but not limited to, an action under the Uniform Declaratory Judgment Act,
specific performance, mandamus and injunctive relief. Damages, if any, to which any non-
breaching Party may be entitled shall be limited to actual damages and shall not include special or
consequential damages. In addition, the prevailing party in any such action shall be entitled to
reasonable attorney’s fees and costs of litigation as determined in a final, non-appealable order in
a court of competent jurisdiction.
ARTICLE VIII
ADDITIONAL PROVISIONS
8. 1 Notices. All required notices under this Agreement (“Notice“) shall be in writing
and shall become effective as follows: (a) on the 10th business day after being deposited with the
United States mail service, postage prepaid, Certified Mail, Return Receipt Requested, addressed
to the Party to be notified; (b) on the day delivered by private delivery or private messenger service
(such as FedEx or UPS) as evidenced by a receipt signed by any person at the delivery address
(whether or not such person is the person to whom the Notice is addressed); or (c) otherwise on
the day actually received by the person to whom the Notice is addressed, including, but not limited
to, delivery in persona and delivery by regular mail. All Notices given pursuant to this section
shall be addressed as follows :
To the City:City of Denton
Ann: City Manager
215 E. McKinney St.
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1230.012\90719.4
Denton, Texas 76201
Fax: (940) 382-7923
Email: Todd.Hileman@cityofdenton.com
With a copy to:City of Denton
Ann: City Attorney
215 E. McKinney St.
Denton, TX 76201
Email: Aaron.Leal(a}cityofdenton.com
If to the District:Denton County Municipal Utility District No. 16
Ann: President, Board of Directors
c/o Coats Rose, P.C.
9 Greenway Plaza, Suite 1000
Houston, Texas 77046
Email : tgreen@coatsrose.com
With a copy to:Attn: Tim Green
Coats Rose, P.C.
9 Greenway Plaza, Suite 1000
Houston, Texas 77046
Email: tgreen@coatsrose.com
8.2 No Waiver. Any failure by a Party to insist upon strict performance by the other
Party of any 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 of the
provisions of this Agreement. No provision of this Agreement may be waived except in writing
signed by the Party waiving such provision. Any waiver shall be limited to the specific purpose
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.
8.3 Governing Law 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 Denton County, Texas, and hereby
submit to the jurisdiction of the courts of Denton County, Texas, and agree that any such court
with proper jurisdiction shall be a proper forum for the determination of any dispute arising
hereunder
8.4 Authority to Execute. The City warrants that this Agreement has been approved by
the City Council in accordance with all applicable public meeting and public notice requirements
(including, but not limited to, notices required by the Texas Open Meetings Act) and that the
individual executing this Agreement on behalf of the City has been authorized to do so. The
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1230.012\90719,4
District warrants that this Agreement has been approved by the Board in accordance with all
applicable public meeting and public notice requirements (including, but not limited to, notices
required by the Open Meetings Act) and the individual executing this Agreement on behalf of the
District has been authorized to do so.
8.5 Entire Agreement; Severability. This Agreement constitutes the entire agreement
between the Parties and supersedes all prior agreements, whether oral or written, covering the
subject matter of this Agreement. If any provision of this Agreement is determined by a court of
competent jurisdiction to be unenforceable for any reason, then (a) such unenforceable provision
shall be deleted from this Agreement; (b) the unenforceable provision shall, to the extent possible,
be rewritten to be enforceable and to give effect to the intent of the Parties; and (c) the remainder
of this Agreement shall remain in full force and effect and shall be interpreted to give effect to the
intent of the Parties.
8.6 Changes in State or Federal Law. If any state or federal law changes so as to make
it impossible for the City or the District to perform its obligations under this Agreement, the Parties
will cooperate to amend this Agreement in such a manner that is most consistent with the original
intent of this Agreement and legally possible.
8.7 Additional Documents and Acts. The Parties agree that at any time after execution
of this Agreement, they will, upon request of the other Party, execute and/or exchange any other
documents necessary to effectuate the terms of this Agreement and perform any further acts as the
other Party may reasonably request to effectuate the terms of this Agreement.
8.8 Assignability, Successors and Assigns. This Agreement shall not be assignable by
any Party without the other Party’s written consent. This Agreement shall be binding upon and
inure to the benefit of the Parties and their respective officers, directors, partners, employees,
representatives, agents, vendors, grantees and/or trustees, heirs, executors, administrators, legal
representatives, successors and assigns, as authorized herein. No assignment by a Party will be
valid or enforceable unless all of the following conditions have been satisfied:
a. The assignment of the Agreement must be evidenced by a recordable document (the
“Assignment”), the form of which must be approved in writing by the Parties (such
approval not to be unreasonably withheld);
b.The Assignment must expressly contain, among other reasonable requirements and/or
conditions of the Parties, an acknowledgment and agreement that all obligations,
covenants, and/or conditions contained in the Agreement will be assumed solely and
completely by the assignee, and also contain the name, address, phone number, and
electronic mail address of the assignee;
c. the Assignor must file any approved, executed Assignment in the Land Records of
Denton County, Texas; and
d. Assignor shall provide the other Party with a file-marked copy of the Assignment
within ten (10) days of filing the same.
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1230.012\90719,4
8.9 Amendment. This Agreement may be amended only by written agreement with
approval of the governing bodies of both the City and the District.
8.10 Interpretation. The Parties acknowledge that each Party ( and if it so chooses, its
counsel) has 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. Unless otherwise
specified, 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. Headings in this
Agreement are for the convenience of the Parties are not intended to be used in construing this
document.
8.11 No Third-Party Beneficiaries. This Agreement is solely for the benefit of the City
and the District. Neither the City nor the District intends by any provision of this Agreement to
create any rights in any third-party beneficiaries or to confer any benefit or enforceable rights
under this Agreement or otherwise upon anyone other than the City and the District.
8.12 Governmental Powers. 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 section. 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.
8.13 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
Exhibit B
Legal Description and Map of Property
Plan Depicting Commercial Property
8.14 Counterpart Originals. This Agreement may be executed in multiple counterparts,
each of which shall be deemed to be an original.
8.15 Recitals. The recitals contained in this Agreement: (a) are true and correct as of the
Effective Date; (b) form the basis upon which the Parties negotiated and entered into this
Agreement; and (c) reflect the final intent of the Parties with regard to the subject matter of this
Agreement. In the event it becomes necessary to interpret any provision of this Agreement, the
intent of the Parties, as evidenced by the recitals, shall be taken into consideration and, to the
maximum extent possible, given full effect. The Parties have relied upon the recitals as part of the
consideration for entering into this Agreement and, but for the intent of the Parties reflected by the
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1230.012\90719.4
recitals, would not have entered into this Agreement, and the recitals are incorporated as part of
the Agreement’s terms.
8.16 Voting Rights in the District. Upon annexation of the Commercial Property for
limited purposes by City, any qualified voters within the Commercial Property may vote in City
elections, pursuant to Local Government Code §43.130(a). Voting rights are subject to all state
and federal laws and regulations. City will comply with all the notice requirements as set forth in
§43.130 of the Local Government Code, as it now exists or hereafter amended.
8.17 Reservation of Rights. To the extent not inconsistent with this Agreement, each
Party reserves all rights, privileges, and immunities under applicable laws. By entering into and
executing this Agreement, City does not in any way waive, limit, or surrender its sovereign
lrnmunlty.
8.18 Authority for Execution. All signatories certify and represent that the execution of
this Agreement is duly authorized and adopted in conformity with applicable law, and the signatory
has been provided with all authority, consent, and/or permissions necessary to bind his/her
respective principal to the terms set forth in this Agreement. The District certifies and represents
that the execution of this Agreement is duly authorized and adopted by its Board of Directors.
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TRANSPORTATION CODE
TITLE 6 . ROADWAYS
SUBTITLE E . MUNICIPAL STREETS
CHAPTER 316. USE OF MUNICIPAL STREETS AND SIDEWALKS FOR PUBLIC
CONVENIENCES AND AMENITIES OR FOR PRIVATE USES
SUBCHAPTER A. USE OF MUNICIPAL STREETS AND SIDEWALKS FOR PUBLIC
CONVENIENCES AND AMENITIES
Sec . 316.001. DEFINITIONS . In this suk)chapter :
( 1 ) "Municipal street" means the entire width of a way
held by a municipality in fee or by easement or dedication that has
a part open for public use for vehicular travel. The term does not
include a designated state or federal highway or road or a
designated county road .
( 2 ) "Roadway" means the portion of a municIpal street
that is improved , desIgned , or ordinarily used for vehicular
travel. The term does not include a curb , berm, or shoulder .
( 3 ) " Sidewalk" means the portion of a munIcipal street
between the curb lines or lateral lines of a roadway and the
adjacent property lines that is improved and designed for or is
ordinarily used for pedestrian travel.
( 4 ) "Sidewalk cafe" means an outdoor dining area that
is located on a sidewalk and that contaIns removable tables ,
chairs , planters , or related appurtenances .
Acts 1995 , 74th Leg. , ch . 165 , Sec . 1, eff . Sept . 1, 1995 .
Sec . 316.002 . PERMITTED IMPROVEMENTS OR FACILITIES ON
MUNICIPAL STREET . ( a) The governing body of a municipality may
permit a person described by Subsection ( b ) to use property in the
municipality on which a municipal street is located for the
establishment or maintenance of :
( 1 ) trees or decorative landscaping , including
landscaping lighting , watering systems , or other accessories for
the maintenance of the trees or landscaping ;
( 2 ) a sidewalk cafe that is :
( A) contiguous to a restaurant in which food
1
preparation , sanitation , and related services for the cafe are
performed ; and
(B ) open to the air , except for any canopy, and
not enclosed by fixed walls ;
( 3 ) an ornamental gate , column , or other ornamental
work denoting the entrance to a neIghborhood or platted and
recorded subdivisIon ;
( 4 ) a supportive or decorative column , arch , or other
structural or decorative feature of a building that is :
( A) of historical value or of
architectural design , character , or significance ; and
( B ) 50 or more years old at the time of
appIIcation for a permit for the establishment or maintenance of
the feature ; or
( 5 ) an amenity for the convenience of the public in the
use of the municipal streets for pedestrian or vehIcular travel,
including a transit bus shelter , drinking fountaIn , or bench .
( b ) The governing body may grant permission under
Subsection ( a) only to :
( 1 ) a person who owns the underlying fee title to the
real property ; or
( 2 ) an entity that holds a lease of the property from
or has written permission to use the property from a person who owns
the underlying fee title to the real property .
( c ) An ornamental work descrIbed by Subsection ( a) ( 3 ) may
display the name of the neighborhood or subdivision , but may not
contain commercIal advertising or other signs .
Acts 1995 , 74th Leg. , ch . 165 , Sec . 1, eff . Sept . 1, 1995 .
unusual
Sec . 316.003 . FINDING REQUIRED . An improvement or facility
described by Section 316.002 ( a) may not be established unless the
governing body of the munIcipality , or a municipal official who is
designated by ordinance to make the finding , finds that :
( 1 ) the improvement or facility will not be located
on , extend onto , or intrude on :
( A) the roadway ; or
(B ) a part of the sidewalk needed for pedestrian
2
use ;
( 2 ) the improvement or facility will not create a
hazardous condition or obstructIon of vehicular or pedestrian
travel on the municipal street ; and
( 3 ) the design and location of the improvement or
facility Includes all reasonable planning to minimize potential
injury or interference to the pubIIc in the use of the municipal
street .
Acts 1995 , 74th Leg . , ch . 165 , Sec . 1, eff . Sept . 1, 1995 .
Sec . 316 , 004 . PERMIT PROGRAM . ( a ) A municipality by
ordinance may establish a permit program under this suk)chapter .
( b ) The governing body of the munIcipality shall include in
the ordinance :
( 1 ) provisIons the governing body determines are
necessary or desirable to protect , at the site of an applicant 1 s
proposed facility , the public , utility companies , and any person
who has the right to use the municipal street ;
( 2 ) provisions that require :
( A) clearances between the facility or
improvement and utility lines that comply with clearances from
structures to utility lines required by a nationally recognized
building code ;
( B ) a permit holder to provide a cash or surety
bond in an amount approved by the municipaIIty sufficient to cover
the costs for the municIpality or a public utility to remove the
permIt holder 1 s facilities or improvements ; and
( C ) a permit holder to pay the costs to relocate a
municipal or public utility facility or improvement in a municipal
street associated with the installation of a facility or
improvement of the permit holder ; and
( 3 ) a provIsion authorizing the municipality or a
utility company or other person authorized by the municipality to
remove , wIthout IIability , any part of a facility for which a permit
has been issued if there is a lawful need for the site or for access
to the site .
( c ) The governing body may include in the ordinance :
3
( 1 ) construction ,
inspection requirements ;
( 2 ) public liability insurance requirements ;
( 3 ) a requirement that the applicant or permit holder
pay for traffic and safety studies ;
( 4 ) provisions for conducting a public hearing on the
issuance , renewal, or revocation of a permit , with notice and
reporting expenses of the hearing to be paid by the applicant or
permit holder ;
( 5 ) a requirement for indemnity agreements by abutting
fee title land owners in the form of covenants that run with the
title to the abutting land ; or
( 6 ) a provision that authorizes the governing body , at
its discretion , to terminate the permit without notice to the
permit holder .
Acts 1995 , 74th Leg. , ch . 165 , Sec . 1, eff . Sept . 1, 1995 .
maintenance ,operatIon ,and
Sec . 316.005 . RENEWAL OF PRIOR PERMIT . The renewal of a
permit issued before April 30 , 1985 , for an improvement or facIlity
described by Section 316.002 ( a) must be renewed in the same manner
as a permit issued under this subchapter .
Acts 1995 , 74th Leg . , ch . 165 , Sec . 1, eff . Sept , 1, 1995 ,
Sec . 316.006 . USE OF MUNICIPAL MONEY OR EMPLOYEE FOR
PERMITTED FACILITY . A municipality may use or permit the use of
municipal money or an employee with respect to a facility operated
under a permit issued under this suk)chapter only for inspections or
removal .
Acts 1995 , 74th Leg . , ch . 165 , Sec . 1, eff . Sept . 1, 1995 .
Sec . 316.007 . IMPROVEMENT OR FACILITY ESTABLISHED OR
MAINTAINED BY MUNICIPALITY . ( a ) A municipality may establish or
maintain , with municipal money , material, equipment , or personnel,
an improvement or facility described by Section 316.002 (a) ( 1 ) or
( 5 ) without a permit , regardless of whether the municipality
establishes a permit program under this chapter .
(b ) A municipality must make the finding required by Section
4
316.003 regarding an improvement or facility the municipality
proposes to place on a municipal street .
Acts 1995 , 74th Leg. , ch . 165 , Sec . 1, eff . Sept . 1, 1995 .
Sec . 316.008 . PUBLIC AND GOVERNMENTAL ACTIONS AND FUNCTIONS
OF MUNICIPALITY . The following actions of a municipality are
public and governmental actions and functions , are exercised for a
public purpose , and are matters of pubIIc necessity ;
( 1 ) granting a permit authorized by this subchapter ;
( 2 ) permitting the use of a municipal street for a
purpose authorized by Section 316.002 under a permit authorized by
this subchapter ; and
( 3 ) establishing or maintaining , with municipal
money , mater ial , equipment , or per sonne I , an improvement or
facility described by SectIon 316 .002 (a) ( 1 ) or ( 5 ) .
Acts 1995 , 74th Leg. , ch . 165 , Sec . 1, eff . Sept . 1, 1995 .
Sec . 316.009 . RIGHT OF ABATEMENT . This chapter does not
impair the right of a municipality or other person to abate an
unlawful obstruction or use of a municipal street .
Acts 1995 , 74th Leg . , ch . 165 , Sec . 1, eff . Sept . 1, 1995 .
Sec . 316.010 . POLITICAL SUBDIVISION NOT REQUIRED TO OBTAIN
PERMIT . ThIs chapter does not require a political subdivision of
this state to obtain a permit to establish or maintain an
improvement or facility authorized by other law.
Acts 1995 , 74th Leg. , ch . 165 , Sec . 1, eff . Sept . 1, 1995 .
SUBCHAPTER B . USE OF STREETS AND SIDEWALKS FOR PRIVATE PURPOSE
Sec . 316.021. MUNICIPAL PERMISSION TO USE STREET OR
SIDEWALK FOR PRIVATE PURPOSE . A municipality may permit and
prescribe the consideratIon and terms for the use of a portion of a
municipal street or sidewalk for a private purpose if the use does
not
( 1 ) interfere with the public use of the street or
sidewalk ; or
5
( 2 ) create a dangerous condition on the street or
sidewalk .
Acts 1995 , 74th Leg . , ch . 165 , Sec . 1, eff . Sept . 1, 1995 .