Recorded On: May 17, 2018 08:59 AM

Denton County Juli Luke

County Clerk

Instrument Number: 56114

ERecordings-RP

DECLARATION

Number of Pages: 104

" Examined and Charged as Follows: "

Total Recording: $438.00

***********THIS PAGE IS PART OF THE INSTRUMENT*********** Any provision herein which restricts the Sale, Rental or use of the described REAL PROPERTY

because of color or race is invalid and unenforceable under federal law.

File Information:

Document Number: 56114

Receipt Number: 20180517000105

Recorded Date/Time: May 17, 2018 08:59AM

User: Darcey B

Station: Station 21

STATE OF TEXAS COUNTY OF DENTON

Record and Return To:

eRx

I hereby certify that this Instrument was FILED In the File Number sequence on the date/time printed hereon, and was duly RECORDED in the Official Records of Denton County, Texas.

Juli Luke County Clerk Denton County, TX

DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS

FOR

TIMBERBROOK

This Declaration of Covenants, Conditions and Restrictions for Timberbrook is made on the date hereinafter set forth by Declarant (as hereinafter defined).

Declarant is the owner of the Property (as herein defined). Declarant desires to impose upon the Property mutually beneficial restrictions under a general plan of improvement for the benefit of the owners of each portion of the Property. The Declaration is intended to provide a flexible and reasonable procedure for the overall development, administration, maintenance and preservation of the Property. In furtherance of such plan, Declarant has caused or intends to cause the Timberbrook Homeowners' Association, Inc. to be formed as a Texas nonprofit corporation to own, operate and maintain the Common Maintenance Areas (as defined herein) and to administer and enforce the provisions ofthis Declaration.

Declarant hereby declares that all of the Property shall be held, sold, used and conveyed subject to the easements, restrictions, covenants and conditions contained in this Declaration, which shall run with the title to the Property. This Declaration shall be binding upon all parties having any right, title or interest in any portion of the Property, their heirs, successors, successors­in-title and assigns, and shall inure to the benefit of each owner of any portion of the Property.

ARTICLE I DEFINITIONS

1.1 "ACA" or "Architectural Control Authority" shall have the meaning given to such terms in Section 6.2 hereof.

1.2 "ACA Standards" means standards adopted by the ACA regarding architectural and related matters, including, without limitation, architectural design, placement of improvements, landscaping, color schemes, exterior finishes and materials and similar features which may be either recommended or required by the ACA for use within the Property.

1.3 "Architectural Committee" means the committee established under Section 6.3 hereof.

1.4 "Association" means Timberbrook Homeowners' Association, Irie., a Texas nonprofit corporation, established for the purposes set forth herein.

1.5 "Association Easement" means (a) any easement reserved herein or created elsewhere intended for the construction, installation, operation, locatio~ or repair of ·any subdivision improvement, including, without limitation, the easement for subdivision fencing reserved in Section 9 .6 hereof and any easement for any landscaping, subdivision sign, monument or entry feature, retaining, screening or perimeter wall or drainage facility, or (b) any other easement for the benefit of the Association shown on a Recorded plat of the Property or otherwise created or shown in any instrument of Record. ·

1.6 "Association Maintenance Fencing" means any fencing installed by Declarant pursuant to an Association Easement. ·

1.7 "Board" means the Board of Directors of the Association.

1.8 "Builder" means any person or entity that purchases one (1) or more Lots for the purpose of constructing improvements for later sale to consumers in the ordinary course of such person's or entity's business.

1.9 "Bylaws" means the bylaws of the Association.

1.10 "Certificate" means the Certifi?ate of Formation of the Association.

1.11 "City" means the City of Justin.

1.12 "Common Area" and "Common Areas" means all areas (including the improvements thereon) within the Property owned or to be owned by the Association for the common use and enjoyment of the Members, including, without limitation, the real property described and/or depicted on Exhibit "B" attached hereto.

1.13 "Common Expenses" means the actual and estimated expenses incurred or anticipated to be incurred by the Association for the benefit of the Member(s) and/or the Common Maintenance Areas.

1.14 "Common Maintenance Areas" means the Common Areas, if any, and any areas within public rights-of-way or easements (public and private), portions of Lots, public parks, private streets, landscaping, entry features and/or fence or similar areas that either the Board deems necessary or appropriate to maintain for the common benefit of the Members or that are shown on a Recorded plat of the Property or portion thereof as being maintained by the Association.

1.15 "County" means Denton County, Texas.

1.16 "Declarant" means Bloomfield Homes LP., and its successors and assigns as provided in Section 12.12 hereof.

1.17 "Declaration" means this Declaration of Covenants, Conditions and Restrictions for Timberbrook, and any amendments and supplements thereto made in accordance with its terms.

1.18 "Designated Interest Rate" means the interest rate designated by the Board from time to time, subject to any interest limitations under Texas law. If the Board fails to designate an interest rate, then the interest rate shall be the lesser of twelve percent (12%) per annum or the highest rate permitted by Texas law. The Designated Interest Rate is also subject to the limitations in Section 12.6 hereof. ·

1.19 "Development Period" means the period commencing upon the date of this Declaration and expiring upon the earlier of (a) when Declarant does not own any real property within the Property, or (b) when Declarant executes a document stating the Development Period has terminated, which termination document may be executed during the period when Declarant still owns real property within the Property.

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1.20 "Dwelling" means any residential dwelling situated upon any Lot.

1.21 "Entry Signs" means the entry feature signs for the subdivision that are or may be placed by Declarant or its agents on the Common Area, Common Maintenance Areas and/or any area covered by an Association Easement.

1.22 "Initial Building Guidelines1' means the initial building guidelines as set forth in Exhibit E attached hereto.

1.23 "Land" means any real property (other than areas dedicated to the City or County) within the Property that has not been platted as a Lot.

1.24 "Lot" means any separate residential building parcel shown on a Recorded subdivision plat of the Property, but only if such parcel has in place the infrastructure (including utilities and streets) necessary to allow construction of a Dwelling thereon. Common Areas and areas deeded to a governmental authority or utility, together with all improvements thereon, shall not be included as part of a Lot.

1.25 "Member" means any person, corporation, partnership, joint venture or other legal entity that is a member of the Association pursuant to the terms in Article III hereof.

1.26 "Owner" means the record owner, whether one or more persons or entities, of fee simple title to any Lot, but excluding in all cases any party holding an interest merely as security for the performance of an obligation. If a Lot is sold under a Recorded contract for deed, then the purchaser (rather than the fee Owner) will be considered the Owner.

1.27 "Property" means the real property described on Exhibit "A" attached hereto (other than areas dedicated to the City or County) and such additional property as is brought within the jurisdiction of the Association and made subject to this Declaration.

1.28 "Record," "Recording" or "Recorded" means the filing of a legal instrument in the Public Records of Denton County, Texas, or such other place as may be designated as the official location for filing deeds, plats and similar documents affecting title to real property.

ARTICLE II PROPERTY RIGHTS

2.1 Owners' Easements of Use and Enjoyment. Every Owner will have a right and non-exclusive easement of use, access and enjoyment in and to the Common Areas, subject to any limitations set forth herein, including, without limitation, the following:

(a) Rules. The right of the Association to establish and publish rules and regulations governing the use of the Common Areas and/or the Lots.

(b) Suspension of Common Area Use Rights. The right of the Association to suspend the right of use of the Common Areas for any period of time during which any assessment against such Owner's Lot is due and remains unpaid.

( c) Conveyance of Common Area. The right of the Association, subject to the provisions hereof, to dedicate, sell or transfer all or any part of the Common Areas.

However, no such dedication, sale or transfer will be effective unless there is an affirmative vote of sixty-seven percent (67%) or greater of all outstanding votes of the Members entitled to be cast.

(d) Mortgage Common Area. The right of the Association, subject to the provisions hereof, to mortgage or lien all or any part of the Common Areas. However, the Common Areas cannot be mortgaged or liened without an affirmative vote of sixty-seven percent (67%) or greater of all outstanding votes of the Members entitled to be cast.

2.2 Prohibitions on Easement of Use and Enjoyment Each Owner's right and easement of use and enjoyment in and to the Common Area is further limited as follows:

(a) No Transfer without Lot. An Owner's right and easement of use and enjoyment in and to the Common Area shall not be conveyed, transferred, alienated or encumbered separate and apart from an Owner's Lot.

(b) No Partition. Except as provided in Section 2.lCc) hereof, the Common Area shall remain undivided and no action for partition or division of any part thereof shall be permitted.

2.3 Right to Delegate Use and Enjoyment of Common Area. Any Owner may extend his or her right of use and enjoyment to the members of such Owner's family, lessees and guests, as applicable, subject to the terms of this Declaration, the Bylaws and any reasonable rules of the Board. An Owner who leases his or her or its Dwelling is deemed to have assigned all such rights to the lessee of such Dwelling.

ARTICLE III MEMBERSHIP AND VOTING

3.1 Membership - Owners. Every Owner by virtne of ownership of a Lot or Land will be a member of the Association. Membership will be appurtenant to and will not be separated from ownership of any Lot or Land (as applicable).

3.2 Voting Rights. The voting rights in the Association shall be as follows:

(a) Members other than Declarant. Except as provided in Section 3.2(b) below, Members shall be entitled to one (1) vote for each Lot owned. However, when more than one person or Member holds an interest in any Lot, only one vote in total may be cast per Lot as the Owners of such Lot determine among themselves and advise the Secretary of the Association in writing prior to the vote being taken. The Association shall have no affirmative obligation to take any action to determine which Member is the person designated to cast the Lot's vote. If the Members fail to advise the Association of the person designated to cast the Lot's vote, then the Lot's vote shall be suspended if more than one person or entity seeks to exercise it.

(b) Declarant. Declarant shall be entitled to ten (10) votes for each Lot owned by Declarant and four (4) votes for each acre of Land owned by Declarant, regardless ifthe time of the vote is within or after the Development Period.

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ARTICLE IV ASSESSMENTS

4.1 Obligation to Pay Assessments. Subject to and except as provided in this Article N, each Owner of any Lot by acceptance of a deed therefor, whether or not it will be so expressed in such deed, is deemed to covenant and agree to pay to the Association: (a) annual assessments as provided in Section 4.3 hereof, (b) special assessments as provided in Section 4.6 hereof, and (c) specific assessments as provided in Section 4.7 hereof.

4.2 Rate of Assessments. Both annual assessments and special assessments shall be fixed at a uniform rate for all Lots, regardless of a Lot's location or size or the value of the Dwelling thereon; provided, however, that vacant Lots shall be subject to a lower rate as provided herein.

(a) Improved Lot. A Lot that has thereon a Dwelling that has been occupied at any time (past or current) for residential purposes (an "Improved Lot") shall be assessed at the full rate.

(b) Vacant Lot. A Lot that does not have thereon a Dwelling that has been occupied at any time (past or current) for residential purposes shall be assessed at the rate of50% of the full rate.

(c) Lots and Land Owned by Declarant - Exempt. Except as provided in Section 4.5 below, during the Development Period all Lots owned by Declarant shall be exempt from all assessments (annual assessments, special assessments and/or specific assessments) and Declarant shall not be obligated to pay any assessments for the Lots. Notwithstanding anything contained herein to the contrary, Declarant shall never be obligated to pay assessments for any Land owned by Declarant.

4.3 Date of Commencement of Annnal Assessments; Dne Dates. The annual assessments provided for herein shall commence as to all Lots on a date to be determined by the Declarant. The amount of subsequent annual assessments against each Lot shall be fixed by the Board at least thirty (30) days in advance of each assessment period. Written notice of the annual assessment shall be sent to an Owner of every Lot subject thereto. The due dates shall be established by the Board. The Board shall also establish whether the annual assessment shall be paid annually, quarterly or monthly.

4.4 Annual Assessment- Increases. The annual assessment may be increased by the Board, provided that the Board gives written notice of the increase to the Members at least thirty (30) days in advance of the effective date of such increase. No vote or other approval shall be required for the increase to be effective, unless the increase is more than ten percent (10%) of the prior annual assessment. If the increase is more than ten percent (10%), then the increase may be disapproved by a sixty-seven percent (67%) or greater vote of the votes of Members entitled to be cast, provided that the vote occurs and the Board receives evidence thereof within sixty (60) days of the date of the increase notice.

4.5 Declarant's Obligation to Pay Budget Deficits. If at any time during the Development Period the Association's operating expenses exceed the assessments received by the Association from the Owners (the "Budget Deficit"), Declarant shall fund the amount of such deficit to the Association; provided, however, that in no event shall Declarant be obligated to pay

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more than an amount equal to the full assessment rate applicable to Improved Lots for the Lots (but not Land) Declarant owns to make up such Budget Deficit. Notwithstanding the foregoing, if the Budget Deficit is the result of the failure or refusal of an Owner or Owners to pay their annual, special or specific assessments, the Association will diligently pursue (and Declarant may also pursue at its option) all available remedies against such defaulting Owners and will promptly reimburse Declarant for any Budget Deficit funded by Declarant from any amounts collected from such Owner or Owners. In no event shall Declarant be obligated to pay any Budget Deficit attributable to the period of time after the Development Period. Furthermore, Declarant's agreement to pay Budget Deficits under this Section 4.5 shall in no way eliminate or diminish Declarant's exemption from all assessments when no Budget Deficit exists.

4.6 Special Assessments. In addition to the annual assessments authorized above, the Association may levy, in any assessment year, a special assessment to cover expenses which the Board determines, in its sole discretion, to more appropriately be handled outside of the regular operating budget, provided that any such special assessment must have an affirmative vote of sixty­seven percent (67%) or greater of all outstanding votes of the Members entitled to be cast.

4.7 Specific Assessments. The Association shall have the power to levy specific assessments against a particular Lot to (a) cover costs incurred in bringing a Lot into compliance with this Declaration, (b) cover costs incurred as a consequence of the conduct (or the failure to act) of the Owner or occupant of a Lot, their agents, contractors, employees, licensees, invitees or guests, and/or (c) collect any ,sums due by the Owner to the Association (other than annual assessments or special assessments or interest or late charges related thereto), including, without limitation, fines.

4.8 Purpose of Annual and Special Assessments - Reserve. Annual assessments and special assessments levied by the Association shall be used for Common Expenses. The Association may establish and maintain a reserve fund for the periodic maintenance, inspection, repair and replacement of improvements to the Common Maintenance Areas.

4.9 Personal Obligation to Pay Assessments. Each assessment provided for herein, together with interest at the Designated Interest Rate, late charges and collection costs (including, without limitation, reasonable attorneys' fees) shall be the personal obligation of the person who was the Owner of such Lot at the time when the assessment arose. Upon a transfer of title to a Lot, the grantee shall be jointly and severally liable for any assessments and other charges due at the time of conveyance. However, no mortgagee under a Recorded first purchase money mortgage or beneficiary of a Recorded first deed of trust (meaning any Recorded mortgage or deed of trust with first priority over other mortgages or deeds of trust), shall be liable for unpaid assessments which accrued prior to the mortgagee's acquisition of title. In addition, no mortgagee shall be required to collect assessments.

4.10 Capitalization of Association - Payment.

(a) Each Owner (other than Declarant or a Builder) of a Lot with a completed Dwelling thereon will pay a contribution to the Association (the "Initial Contribution"), which amount shall be due immediately upon the transfer of title to the Lot. Upon the purchase/resale of a Lot with a completed Dwelling from Declarant or another Builder or an occupying owner, the Initial Contribution initially shall be $350. This fee will be charged each and every time the lot/home is sold (if the Association is in existence). This

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fee can be adjusted up to ten percent (10%) per year by the Board, at the Board's sole discretion; provided, however, any yearly increase which would exceed ten percent (10%) of the amount of the previous year will require approval of sixty-seven percent (67%) or greater of all outstanding votes of the Members entitled to be cast.

(b) Notwithstanding the foregoing provision, the following transfers will not be subject to the requirement to pay the Initial Contribution: (i) foreclosure of a deed of trust lien, tax lien, or the Association's assessment lien; (ii) transfer to, from, or by the Association; or (iii) voluntary transfer by an Owner to one or more co-owners, or to the Owner's spouse, child or parent. In the event of any dispute regarding the application of the Initial Contribution to a particular Owner, the Board's determination regarding application of the exemption will be binding and conclusive without regard to any contrary interpretation of this Section 4.10. The Initial Contribution will be in addition to, not in lieu of, any other assessments or other charges levied in accordance with this Article IV and will not be considered an advance payment of such assessments. The Association will have the power to waive the payment of any Initial Contribution attributable to a Lot by the execution and recordation in the Public Records of a waiver notice executed by a majority of the Board.

4.11 Failure to Pay Assessments; Remedies of the Association. With respect to any assessment or other sum due herein not paid within ten (10) days after the due date, the Association shall have the right to: (a) charge a late fee, in an amount determined by the Board; (b) charge interest on the amount due at the Designated Interest Rate from the due date until the date the sum is paid; (c) charge costs and fees related to the collection of the sum due; and/or (d) exercise any other remedies available to the Association as provided elsewhere in this Declaration. In addition, the Association may bring an action at law against the Owner personally obligated to pay the same. No Owner may waive or otherwise escape liability for the assessments provided for herein by non-use of the Common Maintenance Areas or abandonment of his or her Lot. The failure to pay assessments shall not by the terms of this Declaration constitute a default under an insured mortgage, unless otherwise provided by the terms of such mortgage.

4.12 Lien.

(a) Creation of Lien. The Association shall hereby have a continuing lien against each Lot to secure payment of delinquent assessments (annual assessments, special assessments and specific assessments), as well as interest at the Designated Interest Rate, late charges and costs of collection, including, without limitation, court costs and attorneys' fees, and any other fees or charges that are authorized under or pursuant to this Declaration. Although no further action is required to create or perfect the lien, the Association may, as further evidence and notice of the lien, execute and Record a document setting forth as to any Lot, the amount of delinquent sums due the Association at the time such document is executed and the fact that a lien exists to secure the payment thereof. However, the failure of the Association to execute and Record any such document shall not, to any extent, affect the validity, enforceability, perfection or priority of the lien.

(b) Enforcement of Lien - Judicial or Nonjudicial. The lien may be enforced by judicial foreclosure or by nonjudicial foreclosure; provided, however, that prior to any nonjudicial foreclosure, the Association shall first obtain a court order as required under Section 209.0092(a) of the Texas Property Code, as amended, and otherwise comply with

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any applicable prerequisites or requirements for nonjudicial foreclosure under applicable Jaw, including, without limitation, Chapter 209 of the Texas Property Code, as amended. Each Owner by accepting title to a Lot hereby grants to the Association, whether or not it is so expressed in the deed or other instrument conveying such Lot to the Owner, a private power of nonjudicial sale. The Board may appoint, from time to time, any person including an officer, agent, trustee, substitute trustee or attorney, to exercise the Association's lien rights on behalf of the Association, including the power of sale. The appointment must be in writing and may be in the form of a resolution recorded in the minutes of a Board's meeting. A foreclosure must comply with the requirements of applicable Jaw, including, without limitation, Chapter 209 of the Texas Property Code, as amended. A nonjudicial foreclosure must be conducted in accordance with the provisions applicable to the exercise of powers of sale as set forth in Section 51.002 of the Texas Property Code, as amended, or in any manner permitted by Jaw. In any foreclosure, the Owner is required to pay the Association's costs and expenses for the proceedings, including reasonable attorneys' fees, subject to applicable provisions of the Bylaws and applicable Jaw, such as Chapter 209 of the Texas Property Code, as amended. The Association has the power to bid on the Jot at foreclosure sale and to acquire, hold, lease, mortgage and convey same.

( c) Subordination of Lien. The lien of the assessments provided for herein is subordinate to the lien of any Recorded first purchase money mortgage or deed of trust against a Lot.

( d) Effect of Conveyance. An Owner that conveys title to a Lot shall not be liable for assessments that are attributable to the period after the conveyance of the Lot, except as provided in Section 4.12(e) below. However, a conveyance of title to a Lot shall not affect the assessment lien or relieve the Owner that conveys the Lot from personal liability for any assessments attributable to the period prior to the date of the conveyance, except as provided in Section 4.12(e) below.

( e) Effect of Foreclosure. The foreclosure of a first purchase money mortgage, trustee's sale of a first deed of trust or a deed in lieu thereof will extinguish the lien of such assessment as to payments attributable to the period prior to the foreclosure, trustee's sale or deed in lieu thereof. However, a foreclosure of a first purchase money mortgage, trustee's sale of a first deed of trust or a deed in lieu thereof will not relieve such Lot or Owner thereof from liability for any assessment attributable to the period after the foreclosure, trustee's sale or deed in lieu thereof The foreclosure of a first purchase money mortgage, trustee's sale of a first deed of trust or a deed in lieu thereof shall not release the Owner whose Lot is being foreclosed, sold at a trustee's sale or conveyed pursuant to a deed in lieu from the Owner's obligation to pay assessments attributable to the period prior to the date of such foreclosure, trustee's sale or deed in lieu thereof. For purposes of this Declaration, the use of the term "first" in connection with a mortgage or deed of trust shall refer to the lien priority as compared to other mortgages or deeds of trust.

ARTICLEV THE ASSOCIATION

5.1 The Association - Duties and Powers. The Association is a Texas nonprofit corporation charged with the duties and invested with the powers prescribed by Jaw and set forth in the Certificate, the Bylaws and this Declaration. The Association shall continue to exist until

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the Association is dissolved, regardless if the corporate status expires or lapses. The Association shall have such rights, duties and powers as set forth herein and in the Certificate and the Bylaws.

5.2 Board of Directors. The affairs of the Association shall be conducted by the Board and such officers as the Board may elect or appoint, in accordance with the Certificate and the Bylaws. The Board shall have the powers granted in this Declaration, the Certificate, the Bylaws, and all powers provided by Texas law and all powers reasonably implied to perform its obligations and/or duties provided herein.

5 .3 Limitation on Liability. The liability of an officer, director or committee member of the Association shall be limited as provided in the Certificate.

5.4 Indemnification. Subject to the limitations and requirements of the Texas Business Organizations Code, as amended (the "TBOC"), and in the Bylaws, the Association shall indemnify, defend and hold harmless every officer, director and committee member against all damages and expenses, including, without limitation, attorneys' fees, reasonably incurred in connection with any threatened, initiated or filed action, suit or other proceeding (including settlement of any suit or proceeding, if approved by the then Board) to which such officer, director or committee member may be a party by reason of being or having been an officer, director or committee member, except that such obligation to indemnify, defend and hold harmless shall be limited to those actions for which a director's, officer's or committee member's liability is limited under the Certificate. Additionally, subject to the limitations and requirements of the TBOC and in the Bylaws, the Association may voluntarily indemnify, defend and hold harmless a person who is or was an employee, trustee, agent or attorney of the Association, against any liability asserted against such person or party in that capacity and arising out of that capacity.

5.5 Insurance.

(a) Required Coverages. The Association, acting through its Board or its duly authorized agent, shall obtain and continue in effect, the following insurance coverage, if reasonably available:

(i) Property Insurance - Common Area. Blanket property insurance covering loss or damage on a "special form" basis (or comparable coverage by whatever name denominated) for all insurable improvements on the Common Area and within the Common Maintenance Areas to the extent that the Association has assumed responsibility in the event of a casualty, regardless of ownership.

(ii) General Liability Insurance. Commercial general liability insurance on the Common Maintenance Areas, insuring the Association and its Members for damage or injury caused by the negligence of the Association or any of its Members, employees, agents or contractors while acting on its behalf.

(b) Additional Insurance. The Board may obtain additional insurance as the Board determines advisable, including, without limitation, directors and officers liability insurance, fidelity insurance and any insurance to comply with any applicable insurance requirements of any federal agency or secondary mortgage market entity, including, without limitation, the Federal Home Loan Mortgage Corporation ("FHLMC"), the Federal National Mortgage Association ("FNMA"), the U. S. Department of Veterans

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Affairs ("VA"), and the U.S. Department of Housing and Urban Development ("HUD"), to the extent applicable. In determining whether to obtain additional insurance and/or endorsements thereto that are discretionary the Board shall use its own business judgment to determine if such insurance and/or endorsement is advisable based on the cost and availability of the insurance and/or the endorsement compared to the risks associated therewith.

(c) Review of Policies. The Board shall periodically review the types and amounts of insurance coverage for sufficiency.

5.6 Contracts; Management and Maintenance. The Association shall have the right to contract with any person or entity for the performance of various duties and :functions. This right shall include, without limitation, the right to enter into management, operational or other agreements with other persons or entities; provided, however, that any such agreement shall require approval of the Board. The Board may employ for the Association a management agent or agents at such compensation as the Board may establish to perform such duties and services as the Board shall authorize. The Board may delegate such powers as are necessary to perform the manager's assigned duties, but shall not delegate policymaking authority.

5. 7 Books and Records. The books and records of the Association shall be made open and reasonably available to the Members for inspection and copying as provided in the Bylaws and in accordance with the requirements of applicable law, including, without limitation, Chapter 209 of the Texas Property Code, as amended.

5.8 Dissolution of Association; Conveyance of Assets. If the Association is dissolved other than incident to a merger or consolidation, the assets both real and personal of the Association, shall be conveyed as provided in the Certificate.

5.9 Enforcement - Notice. The Association may impose sanctions for violation of this Declaration (including any rules, guidelines or standards adopted pursuant to this Declaration) in accordance with and subject to the applicable procedures set forth in this Declaration, the Bylaws and applicable law, including Chapter 209 of the Texas Property Code, as amended. Specifically, written notice and opportunity for a hearing must be given prior to the Association exercising its remedies if such notice and hearing is required by this Declaration, the Bylaws and applicable law, including Chapter 209 of the Texas Property Code, as amended. Such sanctions may include all remedies available at law and/or in equity and all remedies herein, including, without limitation, the following:

(a) Fines. The Association may impose reasonable monetary fines which shall constitute a lien upon the Owner of the Lot related to or connected with the alleged violation. The Owner shall be liable for the actions of any occupant, guest or invitee of the Owner of such Lot.

(b) Suspension of Rights to Use Common Area. The Association may suspend any person's or entity's right to use any Common Area; provided, however, that nothing herein shall authorize the Association to limit ingress or egress to or from a Lot.

( c) Right of Self-Help. The Association may exercise self-help or take action to enter upon the Lot to abate any violation of this Declaration.

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( d) Right to Require Removal. The Association may require an Owner, at the Owner's expense, to remove any structure or improvement on such Owner's Lot in violation of this Declaration and to restore the Lot to its previous condition and, upon failure of the Owner to do so, the Association or its designee shall have the right to enter the Lot, remove the violation and restore the property to substantially the same condition as previously existed, without such action being deemed a trespass.

(e) Levy Specific Assessment. The Association may levy a specific assessment to cover costs incurred by the Association in bringing a Lot into compliance with this Declaration.

(f) Lawsuit; Injunction or Damages. The Association has the right, but not the obligation, to bring a suit at law or in equity to enjoin any violation or to recover monetary damages, or both.

(g) Perform Maintenance. In addition to any other enforcement rights, if an Owner fails to perform properly such Owner's maintenance responsibility with respect to a Lot and/or Dwelling, the Association may record a notice of violation in the Records and/or enter onto the Lot and perform such maintenance responsibilities and assess all costs incurred by the Association against the Lot and the Owner as a specific assessment.

The decision to pursue enforcement action, including the commencement of legal proceedings, in any particular case shall be left to the Association's sole and absolute discretion, except that the Association shall not be arbitrary or capricious in taking enforcement action. Without limiting the generality of the foregoing sentence, the Association may determine that, under the circumstances of a particular case: (i) the Association's position is not strong enough to justify taking any or further action; (ii) the covenant, restriction or rule being enforced is, or is likely to be construed as, inconsistent with applicable law; (iii) although a technical violation may exist or may have occurred, it is not of such a material nature as to be objectionable to a reasonable person or to justify expending the Association's resources; or (iv) it is not in the Association's best interests, based upon hardship, expense or other reasonable criteria, to pursue enforcement action. Such a decision shall not be construed as a waiver of the right of the Association to enforce such provision at a later time under other circumstances or preclude the Association from enforcing any other covenant, restriction or rule.

ARTICLE VI ARCIDTECTURAL CONTROLS

6.1 No Improvements Unless Approved by Architectural Control Authority -Except Improvements by Declarant. No building, fence, wall, outbuilding, landscaping, pool, detached building, athletic or play equipment or facility, structure or improvement will be erected, altered, added onto or repaired upon any portion of any Lot without the prior written consent of the ACA. However, ACA approval is not required for (a) any improvements constructed, erected, altered, added onto or repaired by Declarant or a Builder designated in writing by Declarant during the Development Period to be exempt from the ACA approval requirements; (b) any improvements to the interior of a Dwelling, except as provided herein; ( c) the painting or re-bricking of the exterior of any Dwelling in accordance with the same color or design as originally constructed by

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Declarant or in accordance with the approved color and design scheme approved by the ACA; (d) improvements for which this Declaration expressly states that the ACA's prior approval is not required; or ( e) repair or replacement of worn out or damaged improvements if such repair or replacement is with substantially similar materials. Any improvements pursuant to clauses ( c) and (e) immediately preceding must be in compliance with any applicable ACA Standards.

6.2 Architectural Control Authority. The ACA shall have the sole and exclusive authority to perform the functions contemplated by the ACA in this Declaration. The purpose of the ACA is to enforce the architectural standards of the Property and to approve or disapprove plans for improvements proposed for the Lots. The ACA will have the authority to delegate its duties or to retain the services of a professional engineer, management company, architect, designer, inspector or other person to assist in the performance of its duties. The cost of such services shall be included in the Common Expenses. The "ACA" or "Architectural Control Authority" shall be the following entity:

(a) Declarant - During Development Period. Declarant shall be the ACA during the Development Period, unless Declarant has earlier terminated its rights as the ACA in writing.

(b) Architectural Committee - After the Development Period. The Architectural Committee shall be the ACA after Declarant's right to act as the ACA has either expired or voluntarily been terminated.

6.3 Architectural Committee. A committee to be known as the "Architectural Committee" consisting of a minimum of three (3) members will be established after Declarant's right as the ACA has terminated. The members of the Architectural Committee will be appointed, terminated and/or replaced by the Board. The Architectural Committee will act by simple majority vote.

6.4 Submission of Plans. Prior to the initiation of construction of any work required to be approved by the ACA as provided in Section 6.1 above, the Owner (excluding Declarant and any Builder designated in writing by Declarant during the Development Period to be exempt from the ACA approval requirements as provided herein) will first submit to the ACA a complete set of plans and specifications for the proposed improvements, including site plans, landscape plans, exterior elevations, specifications of materials and exterior colors, and any other information deemed necessary by the ACA for the performance of its function. In addition, the Owner will submit the identity of the individual(s) or company(ies) intended to perform the work and projected commencement and completion dates.

6.5 Plan Review.

(a) Timing of Review and Response. Upon receipt by the ACA of all of the information required by this Article VI, the ACA will have thirty (30) days in which to review said plans and other documents and materials submitted pursuant to Section 6.4 hereof. No correspondence or request for approval will be deemed to have been received until all requested documents have actually been received by the ACA in form satisfactory to. the ACA. If the ACA requests additional information and the applicant fails to provide such information prior to the date stated in the ACA's notice, then the application shall be deemed denied. If the applicable submittal is denied or deemed denied, then the applicant

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shall be required to re-apply if the applicant still desires to have the ACA consider the request. If the ACA fails to issue its written approval within thirty (30) days after the ACA's receipt of all materials requested by the ACA to complete the submission, then such failure by the ACA to issue its written approval shall be deemed its disapproval of such materials. The ACA may charge a reasonable fee for reviewing requests for approval. It is the responsibility of the Owner seeking approval from the ACA to verify that the ACA has received its request for review and whether approval has been given by the ACA.

(b) Approval Considerations - Aesthetics. The proposed improvements will be approved if, in the sole opinion of the ACA: (i) the improvements will be of an architectural style, quality, color and material that are aesthetically compatible with the improvements within the Property; (ii) the improvements will not violate any term herein or in the ACA Standards; and (iii) the improvements will not have an adverse impact on the Property. Decisions of the ACA may be based on purely aesthetic considerations. The ACA shall have the authority to make final, conclusive and binding determinations on matters of aesthetic judgment and such determination shall not be subject to review so long as the determination is made in good faith and in accordance with the procedures set forth herein. Each Owner acknowledges that opinions on aesthetic matters are subjective and opinions may vary as to the desirability and/or attractiveness of particular improvements and as the ACA and its members change over time.

6.6 Timing of Completion of Approved Items. All work approved by the ACA shall be completed within one (1) year after the approval by the ACA or such shorter period that the ACA may specify in the notice of approval, unless the completion is delayed due to causes beyond the reasonable control of the Owner, as determined by the ACA. All work and related improvements shall be in compliance with the items approved by the ACA.

6.7 Improvements Impact on Drainage. With respect to any improvements performed on a Lot and/or any alterations to the grade of a yard, the Owner shall take proper precautions to insure that such improvements do not cause the surface water drainage on the Lot to (a) drain onto an adjoining Lot in an amount more than the drainage amount prior to the improvement or alteration, or (b) collect near the foundation of the Dwelling. Although the ACA may comment on and/or deny the approval of plans because of the impact of the proposed improvements or alterations on surface water drainage, the ACA's comments or approval shall not constitute or be construed as a representation, warranty or guaranty that adverse surface water drainage problems will not occur and shall not be relied upon as such. The Owner is responsible for taking the necessary actions in order to avoid any surface water drainage problems, including, without limitation, engaging the services of a qualified consultant.

6.8 No Waiver. The approval by the ACA of any plans, drawings or specifications for any work done or proposed, or for any other matter requiring the approval of the ACA under this Declaration, shall not be deemed to constitute a waiver of any right to withhold approval of any similar plan, drawing specification or matter subsequently submitted for approval.

6.9 Variances. The ACA may authorize variances from strict compliance with the requirements herein, in any ACA Standards or any required procedures: (a) in narrow circumstances where the design meets the intent of the provision from which variance is sought and where granting the variance would enhance design innovation and excellence; or (b) when circumstances such as topography, natural obstructions, hardship, or aesthetic or environmental

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considerations so require. For purposes of this Section 6.9, the inability to obtain approval of any governmental agency, the issuance of any permit or the tenns of any financing as the sole or primary reason for requesting a variance shall not be considered a hardship warranting a variance. No variance shall be contrary to the tenns of this Declaration and no variance shall be effective unless in writing, nor shall a variance in one instance estop the ACA from denying a variance in other circumstances.

6.10 Architectural Control Authority Standards. The ACA may, from time to time and in its sole and absolute discretion, adopt, amend and repeal, by unanimous vote or written consent, ACA Standards. The ACA Standards may not conflict with the tenns of this Declaration. In this regard, any conflict between any ACA Standards and the tenns of this Declaration shall be controlled by the tenns of this Declaration.

6.11 Enforcement; Non-Conforming and Unapproved Improvements. If there are any significant or material deviations from the approved plans in the completed improvements, as determined by the ACA, in its sole and absolute discretion, such improvements will be in violation of this Article VI to the same extent as if made without prior approval of the ACA. In addition to the Association's rights in Section 5.9 hereof, the Association or any Owner may maintain an action at law or in equity for the removal or correction of (a) the non-confonning improvement or alteration, and/or (b) any improvement or alternation to any improvement on any Lot that is not approved by the ACA.

6.12 Liability ofDeclarant and the ACA; Indemnity.

(a) Decisions ofDeclarant and ACA. Declarant and the members of the ACA shall have no liability for decisions made by them so long as such decisions are made in good faith and are not discriminatory, arbitrary or capricious. Any errors in or omissions from the documents submitted to Declarant or the ACA shall be the responsibility of the entity or person submitting the documents, and neither Declarant nor the ACA shall have any obligation to check for errors in or omissions from any such documents, or to check for such documents' compliance with the general provisions of this Declaration, City codes and other regulations, state statutes or the common law, whether the same relate to Lot lines, building lines, easements or any other issue.

(b) No Liability ofDeclarant or ACA. Declarant shall have no responsibility or liability for (i) the creation, selection, management or operation of the ACA, (ii) any actions taken or omitted to be taken by or on behalf of the ACA in connection with this Declaration or the Property, or (iii) any liabilities, obligations, debts, actions, causes of action, claims, debts, suits or damages incurred by or on behalf of or arising in connection with the ACA, the Property or the duties and obligations of the ACA pursuant to this Declaration. Furthennore, neither Declarant, the Association, the ACA, the Board nor the officers, directors, members, employees and agents of any of them, shall be liable in damages to anyone submitting plans and specifications to any of them for approval, or to any Owner by reason of mistake in judgment, negligence or nonfeasance arising out of or in connection with the approval or disapproval or failure to approve or disapprove any such plans or specifications. Every person who submits plans or specifications and every Owner agrees that he will not bring any action or suit against Declarant, the Association, the ACA, the Board or the officers, directors, members, employees or agents of any of them, to

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recover any such damages and hereby releases and quitclaims all claims, demands and causes of action arising out of or in connection with any judgment, negligence or nonfeasance and hereby waives the provisions of any law which provides that a general release does not extend to claims, demands and causes of action not known at the time the release is given. Plans and specifications are not reviewed, approved and/or rejected for engineering or structural design, adequacy of materials or adequacy of soils or drainage, and by approving such plans and specifications, neither Declarant, the Association, the ACA, the Board nor the officers, directors, members, employees and agents of any of them assumes liability or responsibility therefor, nor for any defect in any structure constructed from such plans and specifications.

( c) Indemnification of Declarant and ACA. Without limiting the foregoing provisions of this Section 6.12, subject to any limitations imposed under the TBOC or in the Bylaws, the Association shall indemnify, defend and hold harmless the ACA and Declarant from and against all damages, claims and expenses, including, without limitation, attorneys' fees, reasonably incurred in connection with any threatened, initiated or filed action, suit or other proceeding (including the settlement of any suit or proceeding, if approved by the then Board) to which the ACA or Declarant may be a party by reason of its activities under or in connection with this Declaration.

ARTICLE VII USE RESTRICTIONS AND COVENANTS

7.1 Single Family Residential Use. All Lots(Except for Common Area Lots) and Dwellings will be used and occupied for single-family residential purposes only and no trade or business may be conducted in or from any Lot and/or Dwelling, except that an Owner of the Dwelling may conduct business activities within the Dwelling so long as: (a) the existence or operation of the business activity is not apparent or detectable by sight, sound or smell from outside the Dwelling; (b) the business activity conforms to all zoning requirements for the Property; ( c) the business activity does not involve unreasonable visitation to or from the Dwelling by clients, customers, suppliers or other business invitees; and ( d) the business activity is ancillary to the residential use of the Dwelling and does not diminish the residential character of the Property or constitute a nuisance, or a hazardous or offensive use, or threaten the security or safety of the other residents in the Property. The determination of whether a business activity satisfies the foregoing requirements set forth in clauses (a) through (d) above in this Section 7.1 shall be made by the Board in its sole and absolute discretion. The business activity prohibition will not apply to the use by Declarant [or any Builder] of any (i) Dwelling as a model home, construction office and/or sales office, or (ii) Lot as a site for a selection center trailer, construction office trailer and/or sales office trailer and/or parking lot.

7.2 Parking of Motor Vehicles. No vehicles or similar equipment will be parked or stored in an area visible from any street within the Property, except passenger automobiles, motorcycles, passenger vans and pick-up trucks may be parked in any garage or driveway if such vehicle (a) has less than one (1) ton carrying capacity; (b) has less than 3 axles; (c) is in operating condition; and (d) is generally in daily use as a motor vehicle on the streets and highways of the State of Texas. No vehicles, trailers, implements or apparatus may be driven or parked in the Common Areas, the Common Maintenance Areas or on any easement unless such vehicle, trailer, implement or apparatus is in use for maintaining such area or easement; provided, however, that this restriction will not apply to any driveways, roads, parking lots or other areas designated by the

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Board as intended for such vehicular use. No abandoned, derelict or inoperable vehicles may be stored or located on any Lot or a street within the Property, except within an enclosed garage. No dismantling or assembling of motor vehicles, boats, trailers, recreational vehicles or other machinery or equipment will be permitted in any driveway or portions of any Lot that are visible from any street within the Property.

7.3 Trailers, Boats, Commercial and Recreational Vehicles. No campers, boats, trailers, motor homes, travel trailers, camper bodies, golf carts, recreational vehicles, non­passenger vehicles, vehicles with 3 or more axles or greater than 1 ton carrying capacity, and/or equipment or accessories related thereto may be kept on any Lot, unless such item is operable and such item is (a) kept fully enclosed within a garage located on such Lot; (b) kept fully screened from view by a screening structure or fencing approved by the ACA; ( c) temporarily parked on any street within the Property or on a Lot for the purpose of loading or unloading; or ( d) a commercial vehicle that is in use for the construction, maintenance or repair of a Dwelling or Lot in the immediate vicinity. The Board will have the absolute authority to determine from time to time whether an item is in operable condition and complies with the requirements in clauses (a) through ( d) above in this Section 7.3. Upon an adverse determination by the Board, the Owner will cause the item to be removed and/or otherwise brought into compliance with this Section 7.3. Notwithstanding any provision herein, no trucks or vehicles of any size which transport inflammatory or explosive cargo may be kept on the Property at any time.

7.4 Fences.

(a) Required Fencing. The backyard of each Lot must be fully enclosed with a perimeter fence, except as defined by zoning or as approved by the ACC. The Owner must at all times maintain the fence on its Lot in accordance with the terms of this Declaration, unless such Owner obtains the ACA's written approval to modify, replace, relocate or remove such fence in accordance with the provisions of this Declaration.

(b) Type of Fencing. All perimeter fences will be wood, stone, metal, brick and/or masonry. No other type offencing shall be permitted. All fencing shall comply in all respects (including size and location) with applicable City requirements, including, without limitation the City. All perimeter fences shall be six feet in height unless another height is approved by the ACA and shall be a color approved by the ACA. Unless approved by the ACA, fences may not be stained or painted, except that fences may be stained with a clear stain or with the same color stain as originally applied by Declarant. The portion of all fences which face a street adjoining such Owner's Lot (front, side or rear streets, but not alleys) or which face a Common Area, open space, park or other recreational area adjoining such Owner's Lot (which area may be separated by an alley) shall have the smooth surface of the fence materials facing the applicable street or Common Area. Shall fences shall also have a horizontal board on the outer edge to give a flat top appearance. The fence posts and bracing boards on such front, side and rear fences shall face the interior of the fenced yard. Fencing items and specifics are subject to the ACA review and approval.

(c) Location of Fence. Unless approved by the applicable governmental authority and the ACA, no fence or wall will be placed (i) on any Lot in a location nearer the street than the front building setback line for such Lot, or (ii) on those certain comer Lots whose rear boundary line adjoins any portion of another Lot's front yard of a Lot behind the comer Lot, in a location nearer to the front building setback line for the street

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that is in front of the adjoining Lot. The foregoing shall not limit or restrict fences erected in conjunction with model homes or sales offices. In addition to the foregoing, easements may also restrict the placement offences.

( d) Maintenance of Fencing. Except with respect to Association Maintenance Fencing, each Owner shall maintain the portion of fencing on such Owner's Lot in a presentable condition and shall make all repairs and replacements thereto (as deemed necessary by the Board, in its sole and absolute discretion), except that Owners adjoining a Common Fence (as provided in Section 7.4(f) hereof) shall share in the cost of such maintenance as provided in Section 7 .4(f) hereof. The Association shall be responsible to maintain the Association Maintenance Fencing.

(e) No Changes I Repairs. All repairs and replacements to the perimeter fencing must be done using the same type and color of materials so that such fencing does not appear to have been repaired or replaced, except to the extent of the new appearance of the repaired or replaced materials. Except as provided in this Section 7.4(e), no fencing (including, without limitation, Association Maintenance Fencing) may be changed or modified without the prior written consent of the ACA. This includes the prohibition against changing the height of the fencing and the fencing materials.

(t) Common Fencing. Except for Association Maintenance Fencing, side and rear yard fences that are installed by Declarant or the Builder of the Dwelling to separate adjacent Lots as a common boundary fence (the "Common Fence") shall be maintained jointly by the Owners whose Lot adjoins such Common Fence and the costs associated therewith shall be shared equally by said Owners. An Owner is not released from the joint maintenance obligation even if an Owner constructs a second fence along or near the Common Fence, unless the other Owner agrees in writing otherwise and the ACA's approval is obtained. If the Owners disagree regarding the timing, cost or other applicable issue related to the repair or replacement of a Common Fence or any portion thereof, then either Owner may (i) make the repair or replacement (provided any applicable ACA approval is obtained) and seek collection of one-half (1/2) of the cost of repair or replacement at Arbitration (as defined herein); and/or (ii) seek payment of one-half (1/2) of the cost ofrepair or replacement at Arbitration, subject to the repair or replacement being made. The term "Arbitration" shall mean binding arbitration pursuant to the rules of the American Arbitration Association or such other person or entity approved by the applicable Owners.

7.5 Common Retaining Wall.

(a) Maintenance of Common Retaining Wall. Any retaining walls that are installed by Declarant on a common boundary of two Lots or that are located on a Lot, but adjacent to (within 3 feet) and generally parallel with another Lot (a "Common Retaining Wall") shall be maintained jointly by the Owner(s) whose Lot the Common Retaining Wall is located on and the Owner whose Lot is adjacent to the Common Retaining Wall (depending upon which is applicable) and the costs associated therewith shall be shared equally by said Owners. An Owner is not released from the joint maintenance obligation unless the other Owner agrees in writing to such release. The Common Retaining Wall shall be maintained in the same location, size, style and design and with the same materials, unless both Owners agree in writing otherwise and the ACA's approval is obtained. If the

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Owners disagree regarding the timing, cost or other applicable issue related to the repair or replacement of a Common Retaining Wall and/or portion thereof, then either Owner may (i) make the repair or replacement (provided any applicable ACA approval is obtained) and seek collection of one-half (1/2) of the cost of repair or replacement at Arbitration, and/or (ii) seek payment of one-half (1/2) of the cost of repair or replacement at Arbitration, subject to the repair or replacement being made.

(b) Easement for Common Retaining Wall. Common Retaining Walls may or may not be located exactly on the common boundary line between two Lots. Therefore, there is hereby created an easement in and on the Lot where the Common Retaining Wall is actually located. The easement area shall be limited to the area that is within 3 feet of the common boundary line. The easement shall be for the benefit of the Owner of the Lot that adjoins the Common Retaining Wall so that such Owner can maintain the Common Retaining Wall as provided in Section 7.S(a).

7.6 Outbuildings, Sheds and Detached Buildings. No detached accessory buildings (including, but not limited to, detached garages and storage buildings and sheds) shall be erected, placed or constructed upon any Lot, unless (a) the building is approved by the ACA prior to the installation or construction of the building; (b) such building is compatible with the Dwelling to which it is appurtenant in terms of its design and material composition; ( c) the exterior paint and roofmg materials of such building shall be consistent with the existing paint and roofing materials of the Dwelling; ( d) the building is located within a backyard that has a fence that completely encloses the backyard; (e) the height of the walls (excluding the root) is not greater than 6 feet; (t) the total height of the building (including walls and root) is not greater than 9 feet; (g) such building should not be directly visible from any adjacent street, and (h) the building has less than 200 square feet of floor space. In addition, the Owner is required to comply with any applicable governmental requirements, including, without limitation, any necessary permits.

7. 7 Animals. No animals, livestock or poultry of any kind will be raised, bred or kept on any Lot, except that a reasonable number of cats, dogs or other generally recognized household pets may be permitted on any Lot; however, those pets which are permitted to roam free, or in the sole discretion of the Board, make objectionable noise, endanger the health or safety of, or constitute a nuisance or unreasonable source of annoyance to the occupants of other Lots shall be removed from the Lot upon the request of the Board. If the animal owner fails to remove the animal from the Lot after the Board's request, the Board may remove the animal, in addition to imposing such other sanctions as are authorized by the Declaration and the Bylaws. All animals will be kept in strict accordance with all local laws and ordinances (including leash laws) and in accordance with all rules established by the Association. All persons bringing an animal onto the Common Maintenance Areas shall be responsible for immediately removing any solid waste of said animal.

7.8 Signs. Except for Entry Signs, no sign or emblem of any kind, including "for rent" signs, may be kept or placed upon any Lot or mounted, painted or attached to any Dwelling, fence or other improvement upon such Lot so as to be visible from public view except the following: (a) an Owner may erect one (1) sign on a Lot advertising the Dwelling for sale or lease, provided that the sign does not exceed two (2) feet by three (3) feet in size; (b) an Owner may temporarily place one (1) sign on a Lot advertising the "open house" of a Dwelling for sale, provided that the sign does not exceed two (2) feet by three (3) feet in size and the sign may only be displayed during actual open house hours; ( c) an Owner may place one (1) sign on the inside ofa window advertising

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a Dwelling "for rent", provided that the sign does not exceed one and one-half (1 112) feet by one and one-half (1 112) feet in size; ( d) signs or billboards may be erected by Declarant or any Builder designated in writing by Declarant as having the right to erect such signs or billboards; (e) an Owner may temporarily place one (1) sign on a Lot advertising a "garage sale", provided that the sign does not exceed two (2) feet by three (3) feet in size and the sign may only be displayed during the garage sale hours; or (f) political signs may be erected upon a Lot by the Owner of such Lot advocating the election of one or more political candidates or the sponsorship of a political party, issue or proposal provided that such signs will not be erected more than sixty ( 60) days in advance of the election to which they pertain and are removed within fifteen (15) days after the election. The ACA may in the ACA Standards permit additional signs and/or place additional restrictions or limitations on the signs permitted in this Declaration, provided that such additional restrictions or limitations do not conflict with the terms hereo£ The Association will have the right to remove any sign, billboard or other advertising structure that does not comply with the foregoing. Removal shall not subject Declarant, the Board, the Association or the Association's officers to any liability in connection with such removal.

7.9 Trash; Containers and Collection. No garbage or trash shall be placed or kept on any Lot, except in covered sanitary containers. In no event shall such containers be stored, kept, placed or maintained on any Lot where visible from the location on the street that is immediately in the front of the Dwelling except solely on a day designated for removal of garbage, then such containers may be placed in the designated location for pick-up of such garbage and the container will be removed from view before the following day. Materials incident to construction of improvements may be stored on Lots during construction by Declarant or any Builder designated in writing by Declarant during the Development Period.

7.10 Nuisances. No noxious or offensive activity, including, without limitation, unreasonable smells, noise or aesthetics, will be carried on upon any Lot, nor will anything be done thereon which the Board determines, in its sole and absolute discretion, is or may become an unreasonable source of annoyance or nuisance to the Property.

7.11 Antennae and Satellite Dishes. Except with the written permission of the ACA or as provided herein, exterior antennae, aerials, satellite dishes or other apparatus for the transmission or reception of television, radio, satellite or other signals of any kind may not be placed on the exterior of any Dwelling or on any portion of the Lot outside the Dwelling, except that (a) antennas, satellite dishes or other apparatuses that are one meter or less in diameter and that are designed to receive transmissions other than television broadcast signals shall be permitted; and (b) antennas or satellite dishes designed to receive television broadcast signals shall be permitted. Any of the foregoing permitted devices and any other device permitted by the ACA (a "Permitted Device"), must be located in an area where such Permitted Device is not visible (for aesthetic reasons) from any portion of the street in front of the applicable Lot with the apparatus. However, ifthe Owner determines that the Permitted Device cannot be located in compliance with the foregoing non-visibility requirement without precluding reception of an acceptable quality signal, then the Owner may install the Permitted Device in the least conspicuous alternative location on the Lot where an acceptable quality signal can be obtained. The ACA in the ACA Standards may include rules or provisions regarding the type of additional Permitted Devices and/or the placement of Permitted Devices, provided that such ACA Standards do not conflict with the terms of this Section 7 .11 and do not unreasonably increase the cost of installation, maintenance or use of the Permitted Device. A Permitted Device that complies with the provisions of this Section 7.11 and the ACA Standards shall not require the ACA's approval prior to

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installation. However, the ACA shall be the sole and exclusive authority for purposes of determining ifthe item or device complies with the provisions of this Section 7.11 and the ACA Standards.

7.12 Air-Conditioning Units. Air-conditioning apparatuses must be installed on the ground behind the rear of the Dwelling, on the ground on the side of the Dwelling or in such other location as may be approved by the ACA. No air-conditioning apparatus or evaporative cooler may be located in or on the front of any Dwelling or attached to any roof, wall or any window of any Dwelling.

7.13 No Solar Collectors. Except with the written permission of the ACA, no solar collection panels or similar devices may be placed on or around any Dwelling. During the Development Period, the ACA shall be entitled, in its sole and absolute discretion, to restrict or prohibit entirely the installation of solar collection panels or similar devices. Upon expiration of the Development Period, the ACA shall be entitled to restrict or prohibit the installation of solar collection panels or similar devices if installation would result in any one or more of the following conditions: (1) as adjudicated by a court, the device threatens the public health or safety or violates applicable law; (2) the device is to be located on Common Areas or other property owned or maintained by the Association; (3) the device is to be located in an area on the Owner's Lot other than on the roof of the Dwelling or of another structure approved by the ACA for construction on the Owner's Lot or in a fenced yard or patio owned and maintained by the Owner; (4) if to be mounted on the roof of the Dwelling, the device (a) extends higher than or beyond the roofline, (b) is located in an area other than that which has been designated by the ACA, (c) does not conform to the slope of the roof and has a top edge that is not parallel to the roofline or ( d) has a frame, a support bracket, or visible wiring that is not in a silver, bronze, or black tone commonly available in the marketplace; (5) if to be mounted in a fenced yard or patio, the device is taller than the fence line; or ( 6) if the device, as installed, voids material warranties.

7.14 No Temporary Structures as a Residence. No structure ofa temporary character, including, without limiting the generality thereof, any tent, shack, garage or barn will be used ou any Lot at any time as a residence, either temporarily or permanently; except that camping out in a tent, that is erected in the back yard behind a fully screened fence, is permitted provided that such activity is on a temporary basis and does not become or constitute a nuisance or unreasonable source of annoyance to the occupants of other Lots as determined by the Board in its sole and absolute discretion. This restriction will not be interpreted to limit the right of Declarant [or any Builder] to use trailers or outbuildings as sales offices, selection center offices, construction offices or material storage facilities.

7.15 Landscaping Maintenance. All yards must be sodded or grassed within a reasonable time period not to exceed one (1) month after the initial conveyance of a Lot with a Dwelling thereon to an Owner. Decorative ground cover rock (excluding flower beds and planters with mulch rather than rock) in the front and side yard may not exceed 10% of the total area of the front and side yard. All trees, grass and other landscaping located on any Lot must be properly maintained at all times by the Owner of such Lot in a trimmed, well-kept and clean condition, as determined by the Board, in its sole and absolute discretion. Each Owner will keep all shrubs, trees, grass and plantings of every kind on his or her Lot cultivated, pruned, and free of trash and other unsightly material. In addition, each Owner shall on a regular basis remove weeds from the yard, including, without limitation, flower beds and planter areas.

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7.16 Owner's Maintenance of Adjacent Areas. (a) Unless such obligations are expressly assumed in writing by the Association as provided in paragraph ( c) below, each Owner shall, at its sole cost and expense, be obligated to undertake all activities and work (collectively, the "Adjacent Area Maintenance Work") necessary to properly mow, irrigate and otherwise maintain in good condition all areas ("Adjacent Areas") situated between the boundary of such Owner's Lot and the back of the curb of any adjacent public or private rights-of-way, street or alley. The Adjacent Area Maintenance Work shall include, without limitation, irrigating, pruning, maintaining and replacing all landscaping and trees located within the Adjacent Areas and maintaining and/or replacing (as necessary) all irrigation equipment or lines located within the Adjacent Areas. Furthermore, no landscaping (including, without limitation, trees) or improvements may be removed from, or modified or installed within, the Adjacent Areas without the advance written consent of the Board.

(b) In the event an Owner fails or refuses to properly and on a timely basis (both standards to be determined by the Board in the Board's sole and absolute discretion) perform any Adjacent Area Maintenance Work for which it is responsible, such failure will constitute a violation of this Declaration. In such event, without limitation on any other rights or remedies arising out of such violation, the Board may additionally cause such Adjacent Area Maintenance Work to be performed in a manner determined by the Board, in its sole and absolute discretion. If the Board causes any Adjacent Area Maintenance Work to be performed due to an Owner's failure to do so, the Owner otherwise responsible therefor will be liable to the Association for all costs and expenses incurred by the Association for effecting such Adjacent Area Maintenance Work. If such Owner fails to pay such costs and expenses timely upon demand by the Association, such costs and expenses (plus interest from the date of demand until paid at the Designated Interest Rate) will be assessed against and chargeable to the Owner's Lot(s). Any such amounts assessed and chargeable against a Lot hereunder will be secured by the liens reserved in this Declaration for assessments and may be collected by any means provided in this Declaration for the collection of assessments, including, but not limited to, foreclosure of such liens against the Owner's Lot(s).

(c) The Association at any time, but without any obligation to do so, may assume responsibility for all or a portion of the Adjacent Area Maintenance Work associated with one or more Owner's Lots. The Association may also from time to time enter into agreements with one or more Owners pertaining to the Adjacent Area Maintenance Work or the costs thereof, in the sole discretion of the Board.

(d) To the extent any such Adjacent Areas are Common Areas, an Owner shall not be responsible or liable to the Association for injury or loss caused to third parties as a result of such Owner's performance of his/her Adjacent Maintenance Work within such Adjacent Areas (unless and to the extent caused by the gross negligence or willful misconduct of such Owner), and the Association shall maintain general commercial liability insurance with respect to such Adjacent Areas that are Common Areas. THE ASSOCIATION WILL INDEMNIFY AND HOLD HARMLESS EACH OWNER AND IDS/HER HEIRS, SUCCESSORS AND ASSIGNS FROM ANY TmRD PARTY CLAIMS OR CAUSES OF ACTION FOR DAMAGE TO PERSON OR PROPERTY THAT DIRECTLY ARISE OUT OF SUCH OWNER'S PERFORMANCE OF IDS/HER ADJACENT AREA MAINTENANCE WORK WITHIN ANY ADJACENT AREA THAT IS COMMON AREA, EXCEPT FOR SUCH CLAIMS OR CAUSES OF ACTION ARISING BY REASON OF SUCH OWNER'S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT. "GROSS NEGLIGENCE" AS USED HEREIN DOES NOT INCLUDE SIMPLE NEGLIGENCE, CONTRIBUTORY

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NEGLIGENCE OR SIMILAR NEGLIGENCE SHORT OF ACTUAL GROSS NEGLIGENCE.

7.17 Sidewalks. The Owner shall be responsible for maintaining any sidewalk located on such Owner's Lot to the extent required by the City or any other applicable governmental authority.

7 .18 Exterior Improvement Maintenance. All improvements upon any Lot will at all times be kept in good condition and repair and adequately painted or otherwise maintained by the Owner of such Lot in a presentable well-kept and clean condition, as determined by the Board, in its sole and absolute discretion.

7.19 Garages. Each Dwelling must have a garage that will accommodate a minimum of two (2) automobiles. All garages must comply with all applicable governmental requirements. Garages may be used as Declarant's or a Builder's sales offices prior to permanent occupancy of the main structure; however, sales offices must be converted to garages prior to permanent occupancy. With the exception of periods when garages are used by Declarant or Builder as sales offices, all garages will be maintained for the storage of automobiles, and no garage m?-Y be enclosed or otherwise used for habitation. No carports are permitted on a Lot.

7.20 Clothes Hanging Devices. No clothes hanging devices are to be constructed or placed on the Lot, except within the Dwelling.

7.21 Window Treatment. No aluminum foil, newspaper, reflective film, bed sheets or similar linens, nor any similar treatment, will be placed on windows or glass doors of a Dwelling.

7.22 Oil and Gas Drilling or Mining. No drilling, refining, quarrying or mining operation of oil, gas or other minerals of any kind will be permitted upon or from the surface of any Lot, nor will any oil derrick, well, tank, storage facility or other related equipment be permitted on any Lot. This Section shall not prohibit subsurface drilling activities that begin upon and are conducted from the surface ofreal property not subject to these restrictions.

7 .23 Mail Boxes. Mailboxes shall be of similar type and design and in the same location as originally installed, unless the ACA approves additional types and designs or locations of mail boxes.

7.24 Athletic and Recreational Facilities. No outdoor athletic and recreational facilities such as playscapes, swing sets and sport courts may be placed on a Lot unless (a) such item is placed within a backyard that has a fence that completely encloses the backyard and the location and the item does not exceed twelve (12) feet in height, or (b) such item is a temporary and movable facility that is stored in the garage when not in use, the Dwelling or other fully screened area. Notwithstanding the foregoing, basketball goals and any other recreation equipment designated by the ACA may be located on any portion of the Lot (including side yards) that is behind any portion of the rear of the Dwelling.

7.25 Lighting; Exterior Holiday Decorations. Lighting and/or decorations on a Lot may not be used or placed in a manner which, in the Board's sole and absolute discretion, constitutes a nuisance or an unreasonable source of annoyance to the occupants of other Lots. Except for lights and decorations within the interior of a Dwelling that are not displayed in a

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window, lights and decorations that are erected or displayed on a Lot in commemoration or celebration of publicly observed holidays may not be displayed more than six ( 6) weeks in advance of that specific holiday and must be removed within thirty (30) days after the holiday has ended.

7.26 Flags, Flagpoles, Lawn Decorations and Sculptures. The Owner must have the approval of the ACA to place any decorations, sculptures, fountains, flags, flagpoles and similar items on any portion of such Owner's Lot except the interior of the Dwelling, unless (a) such item is placed within a backyard completely enclosed by a fence which blocks the view of the item at ground level; and (b) such item is no taller than the fence. Displays of American patriotism, school pride, and individuality are encouraged within reason and decorum; however, to maintain the overall aesthetic character of the community, the following restrictions shall govern the display of flags within the community. No more than one (1) in-ground flagpole, of not more than twenty feet (20') in height, may be installed in a location within the Owner's Lot as designated or approved in advance of installation by the ACA. Each Owner is authorized to mount two temporary or permanent flagstaffs on the front, rear or side of their Dwelling by wall bracket. The flagstaffs should not to exceed six ( 6) feet in length. The suggested location for such bracket mounting is on the garage doorframe or near the garage door. No roof-mounted flagstaff is allowed. Multiple flag configurations and any flagstaff in excess of six ( 6) feet must be approved by the ACA prior to installation or display. The Owner may use the flagpole or flagstaff to display the American flag, the Texas flag, a flag of any branch of the United States armed forces, and pennants or banners such as school flags or sports team flags. All flags may contain no more than twenty-four (24) square feet of material and must be of good taste and presentation.

7.27 Pools/Equipment. All swimming pools and associated decks shall be located in side and rear yards. They may not be located in easements. Pool equipment must be located where it will not cause a nuisance to neighbors and must be fully screened with privacy fence or evergreen shrubs or other approved landscaping. A privacy fence shall not be higher than necessary to screen the equipment. Lattice-type fencing will be considered for this purpose. Above ground pools, masonry block, vinyl lined and low hung vinyl lined pools are not allowed. Pneumatic pool enclosures are not permitted.

7.28 No Lot Consolidation or Division. No Owner, other than Declarant, may divide any Lot and/or consolidate any adjoining Lots and/or any portion thereof.

7.29 Drainage Alteration Prohibited. Unless approved by the ACA, no Owner will: (a) alter the surface water drainage flows of a Lot as originally established at the time of the initial construction of the Dwelling; or (b) install landscaping or other improvements that may interfere with, obstruct or divert drainage flows established by Declarant or any Builder. The foregoing shall not prevent or limit Declarant from performing any grading work and/or changing any surface water drainage flow on any Lot.

7.30 Construction Activities. This Declaration will not be construed so as to unreasonably interfere with or prevent normal construction activities during the construction or remodeling of or making of additions to improvements by an Owner (including Declarant) upon any Lot within the Property. Specifically, no such construction activities will be deemed to constitute a nuisance or a violation of this Declaration by reason of noise, dust, presence of vehicles or construction machinery, posting of signs or similar activities, provided that such construction is pursued to completion with diligence and conforms to usual construction practices in the area. If construction upon any Lot does not conform to usual practices in the area as determined by the

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Board, in its sole good faith judgment, the Board will have the authority to obtain an injunction to stop such construction. In addition, if during the course of construction upon any Lot, there is an excessive accumulation of debris of any kind that is offensive or detrimental to the Property or any portion thereof, then the Board may contract for or cause such debris to be removed, and the Owner of such Lot will be liable for all expenses incurred in connection therewith.

7.31 Declarant [and Builder) Development and Construction. Notwithstanding any other provision herein, Declarant, and its successors and assigns, and any Builders, will be entitled to conduct on the Property all activities normally associated with, and convenient to, the development of the Property and the construction and sale of Dwellings on the Property.

ARTICLE VIII COMMON AREAS

8.1 Association to Hold and Maintain. The Association will accept and own all Common Areas in fee simple title. The Association shall maintain, at the Association's cost, the Common Area and any improvements and landscaping thereon in good repair. The Association shall also maintain the Common Maintenance Areas, at the Association's cost, to the extent the Board determines that such maintenance is desirable. The costs of such maintenance for the Common Areas and Common Maintenance Areas shall be the Association's responsibility, regardless if such cost was incurred during or after the Development Period.

8.2 Use of Common Areas at Own Risk. Each Owner, by acceptance of a deed to a Lot, acknowledges that the use and enjoyment of any Common Area recreational facility involves risk of personal injury or damage to property. Each Owner acknowledges, understands and covenants to inform its tenants and all occupants of its Lot that Declarant, any Builder and the Association, its Board, officers and any committees are not insurers of personal safety and that each person using the Common Area assumes all risks of personal injury and loss or damage to property, resulting from the use and enjoyment of any recreational facility or other portion of the Common Area

8.3 Condemnation of Common Area. In the event of condemnation or a sale in lieu thereof of all or any portion of the Common Areas, the funds payable with respect thereto will be payable to the Association and will be used by the Association as the Board determines, in its sole discretion, including, without limitation, (a) to purchase additional Common Areas to replace that which has been condemned, (b) to reconstruct or replace on the remaining Common Area any improvements that were on condemned Common Area, (c) to pay for Common Expenses, or (d) to be distributed to each Owner on a pro rata basis.

8.4 Damage to Common Area. If the Common Area or improvements on the Common Maintenance Areas are damaged and ifthere are insurance proceeds sufficient to repair such damage and return such areas or improvements to their prior condition, then the Association shall cause such damage to be repaired or reconstructed unless sixty-seven percent ( 67%) or more of all outstanding votes of the Members entitled to be cast vote not to make such repair or reconstruct within ninety (90) days after the loss. If said sixty-seven percent ( 67%) vote is cast not to repair or reconstruct such damage and no alternative improvements are authorized, the damaged property shall be cleared of all debris and ruins and thereafter shall be maintained by the Association in a neat and attractive condition. Any insurance proceeds remaining after paying the

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costs of repair or reconstruction, or after such settlement as is necessary and appropriate, shall be retained by and for the benefit of the Association.

8.5 Conveyance of Common Areas by Declarant to Association. Declarant shall have the right to convey title to any portion of the Property owned by Declarant, or any easement interest therein, to the Association as Common Area, and the Association shall be required to accept such conveyance. Property conveyed by Declarant to the Association as Common Area shall be conveyed free and clear of monetary liens and encumbrances other than taxes and assessments imposed by governmental entities or districts authorized by Texas law. Any such conveyance shall be effective upon recording the deed or instrument of conveyance in the Records.

8.6 Annual Inspection of Common Area - Budget. From the period commencing on the expiration of the Development Period until ten (10) years thereafter, the Association shall at least annually examine the condition of the Common Area to evaluate the quality, frequency and adequacy of maintenance performed during the preceding year, and to recommend maintenance for the upcoming year. The examination and report may be performed by one or more experts hired by the Association for this purpose, such as a professional property manager, an engineer or professional contractors such as landscapers and brick masons. Within fifteen (15) days after performing the inspection, the expert should submit to the Board a written report with findings and recommendations. The Board should evaluate the Association's operating budget and reserve accounts for maintenance, repair and replacement in light of the expert's findings and recommendations. Any decision by the Board to reduce or defer recommended maintenance should be made with an evaluation of the potential consequences for future costs and deterioration. Any expert's report shall be a record of the Association that is available to Owners for inspection and copying.

8.7 No Representations or Warranties Regarding Lakes, Creeks or Drainage Areas. Declarant has informed and hereby informs the Association that any lakes, creeks or drainage areas located on or to be constructed upon the Common Area (the "Water/Drainage Improvements") are intended primarily for drainage purposes and are not intended as a recreational feature or an amenity with certain specific aesthetic qualities. Declarant makes no representations or warranties regarding the Water/Drainage Improvements and Declarant hereby disclaims any and all representations and warranties regarding the Water/Drainage Improvements, including, without limitation, any implied warranties, including any warranty of fitness for a particular purpose and any warranty of good and workmanlike construction. THE ASSOCIATION HEREBY AGREES TO ACCEPT THE WATER/DRAINAGE IMPROVEMENTS IN THEIR "AS-IS" CONDITION.

8.8 No Representations or Warranties Regarding Open Space. Declarant has informed and hereby informs the Association that the Common Area or portions thereof depicted and/or described on Exhibit "C" attached hereto (the "Open Space Area"), is intended primarily as an unimproved open space to be maintained in a natural or semi-natural condition and not as a recreational feature or an amenity with certain specific aesthetic qualities. Declarant makes no representations or warranties regarding the Open Space Area and Declarant hereby disclaims any and all representations and warranties regarding the Open Space Area, including, without limitation, any implied warranties, including any warranty of fitness for a particular purpose and any warranty of good and workmanlike construction. THE ASSOCIATION HEREBY AGREES TO ACCEPT THE OPEN SPACE AREA IN ITS "AS-IS" CONDITION.

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ARTICLE IX EASEMENTS

9.1 Easement for Utilities on Common Area. During the Development Period, Declarant, on behalf of itself, reserves the right to grant perpetual, nonexclusive easements for the benefit of Declarant or its designees, upon, across, over, through and under any portion of the Common Area for the construction, installation, use and maintenance for utilities, including, without limitation, water, sewer, electric, cable television, telephone, natural gas and storm water and drainage related structures and improvements. The Association will also have at all times the right to grant the easements described in this Section 9.1.

9.2 Easement to Correct Drainage on Property. For a period of five (5) years after the expiration of the Development Period, Declarant hereby reserves for the benefit of Declarant and any Builder, a blanket easement on, over and under the ground within the Property (excluding the area where a Dwelling is located) to maintain and correct drainage of surface waters and other erosion controls in order to maintain reasonable standards of health, safety and appearance, and will be entitled to remove trees or vegetation, without liability for replacement or damages, as may be necessary to provide adequate drainage facilities. Notwithstanding the foregoing, nothing herein will be interpreted to impose any duty upon Declarant or any Builder to correct or maintain any drainage facilities within the Property. Any damage to a Lot caused by or due to the exercise of the foregoing drainage easement rights, shall be promptly repaired by the party exercising such easement rights after completing its construction activities in the damaged area.

9 .3 Easement for Right to Enter Lot. If an Owner fails to maintain its Lot as required herein, or in the event of emergency, the Association will have the right to enter upon the Lot to make repairs and to do other work reasonably necessary for the proper maintenance and operation of the Property. Entry upon the Lot as provided herein will not be deemed a trespass, and the Association will not be liable for any damage so created unless such damage is caused by the Association's wilI:ful misconduct or gross negligence.

9.4. Easement for Right to Enter and Inspect Common Area. For a period of ten (10) years after the expiration of the Development Period, Declarant shall have the right, but not the obligation, to enter upon the Common Area for purposes of inspecting and repairing the Common Area and/or any improvements thereon at Declarant's expense; provided; however, nothing contained herein shall obligate Declarant to make any such inspections or repairs.

9.5 Temporary Easement to Complete Construction. All Lots will be subject to an easement of ingress and egress for the benefit of Declarant, its employees, subcontractors, successors and assigns, over and upon the front, side and rear yards of the Lots as may be expedient or necessary for the construction, servicing and completion of Dwellings and landscaping upon adjacent Lots, provided that such easement will terminate as to any Lot twenty-four (24) months after the date such Lot is conveyed to an Owner [other than a Builder]. Any damage to a Lot caused by Declarant due to exercise of the foregoing completion easement rights, shall be promptly repaired by the party exercising such easement rights after completing its construction activities in the damaged area.

9.6 Association Easement. Declarant hereby reserves an Association Easement for the benefit of Declarant and the Association for the purpose of placing, constructing and maintaining any Entry Signs, Association Maintenance Fencing and landscaping located within or

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on a Lot. Without limiting the foregoing, Declarant hereby specifically reserves for the benefit of Declarant and the Association an Association Easement over the area described on Exhibit "D" attached hereto for the purpose of placing, constructing and maintaining subdivision Association Maintenance Fencing thereon. The real property subject to the Association Easement shall be conveyed subject to the Association Easement.

ARTICLEX ANNEXATION AND WITHDRAWAL

I 0.1 Annexation by Declarant. While Declarant owns any real property subject to this Declaration, Declarant may, at its sole option, amend and expand the definition of Property by annexing real property into the Association and subjecting such real property to the terms hereof; provided; however, that Declarant shall not have the right to annex real property that is located more than one-half (112) of a mile from the Property (as such term may be amended), without the required approval of the Members as provided in Section 10.2 below.

10.2 Annexation by Association. The Association may annex any real property into the Association and subject such real property to the terms hereof with the affirmative vote of sixty-seven percent (67%) or more of all outstanding votes of the Members that are entitled to be cast.

I 0.3 Recording of Annexation. The annexation of such real property shall be evidenced by a written Recorded document.

10.4 No Duty to Annex. Nothing herein contained shall establish any duty or obligation on the part ofDeclarant or any Member to annex any real property, and no owner of any property excluded from the Association shall have any right to have such property annexed thereto.

10.5 Withdrawal of Property. While Declarant owns any real property subject to this Declaration, Declarant may amend this Declaration to withdraw any real property from the definition of the Property and from the coverage of this Declaration, provided that the owner of real property to be withdrawn consents to such withdrawal.

ARTICLE XI DISPUTE RESOLUTION

11.1 Introduction & Definitions. The Association, the Owners, Declarant and all persons subject to this Declaration (individually a "f!!:ty" and collectively, the "Parties") agree to encourage the amicable resolution of disputes involving the Property and to avoid the emotional and financial costs of litigation if at all possible. Accordingly, each Party hereby covenants and agrees that this Article applies to all Claims (as hereafter defined). As used in this Article only, the following words, when capitalized, have the following specified meanings:

(a) "Claim" means any claim, grievance or dispute between or among the Parties arising from this Declaration, the Bylaws or the Certificate or related to the Property, except Exempt Claims (as defined below), and including, without limitation: (i) Claims arising out of or relating to the interpretation, application or enforcement of this Declaration; (ii) Claims relating to the rights and/or duties ofDeclarant as Declarant under

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this Declaration; and (iii) Claims relating to the design, construction or maintenance of the Property.

(b) "Claimant" means any Party having a Claim against any other Party.

(c) "Exempt Claims" means the following claims or actions, which are exempt from this Article: (i) the Association's claim for assessments, and any action by the Association to collect assessments; (ii) an action by a Party to obtain a temporary restraining order or equivalent emergency equitable relief, and such other ancillary relief as the court deems necessary to maintain the status quo and preserve the Party's ability to enforce the provisions of this Declaration; (iii) enforcement of the easements, architectural control, maintenance and use restrictions of this Declaration; (iv) a suit to which an applicable statute of limitations would expire within the notice period of this Article, unless a Party against whom the Claim is made agrees to toll the statute of limitations as to the Claim for the period reasonably necessary to comply with this Article; and (v) a dispute that is subject to alternate dispute resolution (such as mediation or arbitration) by the terms of a public law or another instrument, such as a contract or warranty agreement, in which case the dispute is exempt from this Article unless the Parties agree to have the dispute governed by this Article.

( d) "Respondent" means the Party against whom the Claimant has a Cl:iim.

11.2 Mandatory Procedures. Claimant may not file suit in any court or initiate any proceeding before any administrative tribunal seeking redress or resolution of its Claim until Claimant has complied with the procedures of this Article.

11.3 Notice. Claimant must notify Respondent in writing of the Claim (the "Notice"), stating plainly and concisely: (a) the nature of the Claim, including date, time, location, persons involved, and Respondent's role in the Claim; (b) the basis of the Claim (i.e., the provision of the Declaration, Bylaws or Certificate other authority out of which the Claim arises); (c) what Claimant wants Respondent to do or not do to resolve the Claim; and (d) that the Notice is given pursuant to this Section 11.3.

11.4 Negotiation. Claimant and Respondent will make every reasonable effort to meet in person to resolve the Claim by good faith negotiation. Within sixty ( 60) days after Respondent's receipt of the Notice, Respondent and Claimant will meet at a mutually-acceptable place and time to discuss the Claim. At such meeting or at some other mutually-agreeable time, Respondent and Respondent's representatives will have full access to the property that is subject to the Claim for the purposes of inspecting the property. If Respondent elects to take corrective action, Claimant will provide Respondent and Respondent's representatives and agents with full access to the property to take and complete corrective action.

11.5 Mediation. If the Parties negotiate but do not resolve the Claim through negotiation within one hundred twenty (120) days from the date of the Notice (or within such other period as may be agreed on by the Parties), Claimant will have thirty (30) additional days within which to submit the Claim to mediation under the auspices of a mediation center or individual mediator on which the Parties mutually agree. If Claimant does not submit the Claim to mediation within the thirty (30) day period, Claimant is deemed to have waived the Claim, and Respondent is released and discharged from any and all liability to Claimant on account of the Claim.

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11.6 Termination of Mediation. If the Parties do not settle the Claim within thirty (30) days after submission to mediation, or within a time deemed reasonable by the mediator, the mediator will issue a notice of termination of the mediation proceedings indicating that the Parties are at an impasse and the date that mediation was terminated. Thereafter, Claimant may file suit or initiate administrative proceedings on the Claim, as appropriate.

11.7 Allocation of Costs. Except as otherwise provided in this Section 11.7, each Party bears all of its own costs incurred prior to and during the proceedings described in Sections 11.3. 11.4 and 11.5 above, including its attorneys' fees. Respondent and Claimant will equally divide all expenses and fees charged by the mediator.

11.8 Enforcement of Resolution. Any settlement of the Claim through negotiation or mediation will be documented in writing and signed by the Parties. If any Party thereafter fails to abide by the terms of the agreement, then the other Party may file suit or initiate administrative proceedings to enforce the agreement without the need to again comply with the procedures set forth in this Article. In that event, the Party taking action to enforce the agreement is entitled to recover from the non-complying Party all costs incurred in enforcing the agreement, including, without limitation, attorney's fees and court costs.

11.9 General Provisions. A release or discharge of Respondent from liability to Claimant on account of the Claim does not release Respondent from liability to persons who are not a party to Claimant's Claim. A Party having an Exempt Claim may submit it to the procedures of this Article.

11.10 Litigation Approval and Settlement. In addition to and notwithstanding the above alternate dispute resolution procedures, the Association may not initiate any judicial or administrative proceeding without the affirmative vote of at least seventy-five percent (75%) of the votes of all Members, except that no such approval is required (a) to enforce provisions of this Declaration, including collection of assessments; (b) to challenge condemnation proceedings; ( c) to enforce a contract against a contractor, vendor, or supplier of goods or services to the Association; ( d) to defend claims filed against the Association or to assert counterclaims in a proceeding instituted against the Association; or (e) to obtain a temporary restraining order or equivalent emergency equitable relief when circumstances do not provide sufficient time to obtain the prior consents of Owners in order to preserve the status quo. Also, without limiting the provisions of Section 6.12 hereof, the Association may not initiate any judicial or administrative proceeding against Declarant without the affirmative vote of at least seventy-five percent (75%) of the votes of all Members. The Board, on behalf of the Association and without the consent of Owners, is hereby authorized to negotiate settlement of litigation, and may execute any document related thereto, such as settlement agreements and waiver or release of claims.

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ARTICLE XII MISCELLANEOUS

12.1 Declaration Term - Perpetual. Unless ninety (90%) of all outstanding votes of the Members that are entitled to be cast approve the termination of this Declaration, the provisions of this Declaration shall run with and bind the land and shall be and remain in effect perpetually to the extent permitted by law. A written instrument terminating this Declaration shall not be effective unless Recorded.

12.2 Amendments to Declaration.

(a) Amendment by Declarant. During the Development Period, Declarant, in its sole discretion and without a vote or the consent of any other party, shall have the right to amend this Declaration for the following purposes: (i) to add real property to the Property, (ii) to create lots, easements, common areas, common maintenance areas, fencing and signage, (iii) to modify the use and covenant restrictions in Section VII hereof, (iv) to comply with the requirements of any governmental authority or institutional lender or underwriting lender, (v) to resolve conflicts, clarify ambiguities and to correct misstatements, errors or omissions in this Declaration, and (vi) for any other purpose; provided, however, that any amendment made pursuant to this clause (vi) must not have any material adverse effect on any right of an Owner without the consent of such Owner.

(b) Amendment by Association. Except as provided in Article XI above, the Association may amend the terms and provisions of this Declaration by the affirmative vote of sixty-seven percent (67%) or greater of all outstanding votes of the Members entitled to be cast Any amendment must be Recorded. Notwithstanding the foregoing, the Association shall be required to obtain Declarant's written consent to any amendment during the Development Period.

12.3 Enforcement by Association and/or Owner. The Association or any Owner will have the right to enforce, by any proceeding at law or in equity, all restrictions, conditions, covenants, reservations, liens and charges imposed now or in the future by the provisions of this Declaration. Failure of the Association or any Owner to enforce any covenant or restriction of this Declaration will in no event be deemed a waiver of the right to do so in the future.

12.4 Remedies; Cumulative. In the event any Lot does not comply with the terms hereof or any Owner fails to comply with the terms hereof, the Association and/or any Owner will have each and all of the rights and remedies which may be provided for in this Declaration, the Bylaws and any rules and regulations, and those which may be available at law or in equity, including, without limitation, enforcement of any lien, damages, injunction, specific performance, judgment for payment of money and collection thereof, or for any combination of remedies, or for any other relief. No remedies herein provided or available at law or in equity will be deemed mutually exclusive of any other such remedy, but instead shall be cumulative.

12.S Notice to Association of Sale or Transfer. Any Owner (other than Declarant) desiring to sell or otherwise transfer title to his or her Lot shall give the Board written notice of the name and address of the purchaser or transferee, within thirty (30) days after the date of such transfer of title, and such other information as the Board may reasonably require. With the Board's approval a number of independent fees may be charged in relation to the transfer of title to a Lot,

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including, but not limited to, fees for resale certificates, estoppel certificates, copies of this Declaration, the Bylaws and/or the Certificate, compliance inspections, ownership record changes and priority processing, provided the fees are customary in amount, kind and number for the local marketplace. Transfer-related fees are not refundable and may not be regarded as a prepayment of or credit against regular or special assessments. Transfer-related fees do not apply to the following transfers unless a party to the transfer requests the corresponding documentation: foreclosure of a deed of trust lien, tax lien or the Association's assessment lien; transfer to, from or by the Association; or voluntary transfer by an owner to one or more co-owners, or to the owner's spouse, child or parent. Transfer-related fees may be charged by the Association or by the Association's managing agent, provided there is no duplication of fees. Transfer-related fees charged by or paid to a managing agent must have the prior written approval of the Association, are not subject to the Association's assessment lien, and are not payable by the Association. This Section 12.5 does not obligate the Board or the manager to levy transfer-related fees.

12.6 Limitation on Interest. All agreements between any Owner and the Association and/or Declarant are expressly limited so that the amount of interest charged, collected or received on account of such agreement shall never exceed the maximum amount permitted by applicable law. If, under any circumstances, fulfillment of any provision of this Declaration or of any other document requires exceeding the lawful maximum interest rates, then, ipso facto, the obligation shall be reduced to comply with such lawful limits. If an amount received by the Association and/or Declarant should be deemed to be excessive interest, then the amount of such excess shall be applied to reduce the unpaid principal and not to the payment of interest. If such excessive interest exceeds the unpaid balance due to the Association and/ or Declarant, then such excess shall be refunded to Owner.

12.7 Construction 11,nd Interpretation. This Declaration shall be liberally construed and interpreted to give effect to its purposes and intent, except as otherwise required by law.

12.8 Notices. Except as otherwise provided in the Bylaws or this Declaration, all notices, demands, bills, statements and other communications under this Declaration shall be in writing and shall be given personally or by mail. Notices that are mailed shall be deemed to have been duly given three (3) days after deposit, unless such mail service can prove receipt at an earlier date. Owners shall maintain one mailing address for a Lot, which address shall be used by the Association for mailing of notices, statements and demands. If an Owner fails to maintain a current mailing address for a Lot with the Association, then the address of that Owner's Lot is deemed to be such Owner's mailing address." If a Lot is owned by more than one person or entity, then notice to one co-owner is deemed notice to all co-owners. Attendance by a Member at any meeting shall constitute waiver of notice by the Member of the time, place and purpose of the meeting. Written waiver of notice of a meeting, either before or after a meeting, of the Members shall be deemed the equivalent of proper notice

12.9 Not a Condominium. This document does not and is not intended to create a condominium within the meaning of the Texas Uniform Condominium Act, Tex. Prop. Code Ann., Section 82.001, et seq.

12.10 Severability. Invalidation of any one of these covenants, conditions, easements or restrictions by judgment or court order will in no manner affect any other provisions which will remain, in full force and effect.

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12.11 Rights and Obligations Run With Land. The provisions of this Declaration are covenants running with the land and will inure to the benefit of, and be binding upon, each and all of the Owners and their respective heirs, representatives, successors, assigns, purchasers, grantees and mortgagees. No Lot is exempt from the terms set forth herein. By the recording or the acceptance of a deed conveying a Lot or any ownership interest in the Lot whatsoever, the person to whom such Lot or interest is conveyed will be deemed to accept and agree to be bound by and subject to all of the provisions of this Declaration, whether or not mention thereof is made in said deed. Notwithstanding any provision herein, the rights of Declarant as provided herein shall not run with the land, but instead may only be transferred or assigned as provided in Section 12.12 hereof

12.12 Assignment of Declarant's Rights. Declarant may assign, in whole or in part, its rights as Declarant by executing and Recording a document assigning such rights. There may be more than one Declarant, if Declarant makes a partial assignment of Declarant status. Without limiting the terms of Section 6.12 hereof, upon a Declarant's assignment of any or all of its rights as Declarant under this Declaration, the assigning Declarant shall automatically, without further acknowledgment or consent of any other party, be fully released and discharged from any obligations accruing under this Declaration after the date of such assignment, including, without limitation, the obligation of such assigning Declarant to fund Budget Deficits arising after such assignment.

12.13 Disclaimer Regarding Security. Neither the Association nor Declarant shall in any way be considered insurers or guarantors of security within the Property, nor shall any of them be held liable for any Joss or damage by reason of failure to provide adequate security or of ineffectiveness of security measures undertaken. No representation or warranty is made that any fire protection system, burglar alarm system or other security system cannot be compromised or circumvented, nor that any such systems or security measures undertaken will in all cases prevent Joss or provide the detection or protection for which the system is designed or intended. Each Owner acknowledges, understands and covenants to inform its tenants, invitees and licensees that the Association, its Board and committees and Declarant are not insurers and that each person using any portion of the Property assumes all risks for loss or damage to persons, to Lots and to the contents of Lots resulting from acts of third parties.

12.14 Adjacent Land Use. Although this Declaration may contain disclosures about the Property or its location on the date of this Declaration, Declarant makes no representation that these are the only noteworthy features of the Property or its location. A prospective owner or resident must make his own inspection of the Property, its location and nearby land uses, and make inquiries of anything that concerns him. Declarant makes no representation of any kind as to current or future uses, actual or permitted, of any land that is adjacent to or near the Property, regardless of what any plat shows as potential uses of adjoining land. Declarant and the Association cannot and do not guaranty scenic views, volumes of traffic on streets around and through the Property, availability of schools or shopping, or any other aspect of the Property that is affected by the uses or conditions of adjacent or nearby land, water or air.

12.15 Attorneys' Fees and Court Costs. If litigation is instituted to enforce any provision herein, then the prevailing party shall be entitled to all attorneys' fees and court costs related to such legal action.

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12.16 Gender. All personal pronouns used in this Declaration, whether used in the masculine, feminine or neuter gender, will include all other genders, and the singular will include the plural, and vice versa.

12.17 Headings. The headings contained in this Declaration are for reference purposes only and will not in any way affect the meaning or interpretation of this Declaration.

12.18 Conflicts. In the event of conflict between this Declaration and any Bylaws, rules, regulations or the Certificate, this Declaration will control.

12.19 Exhibits. All exhibits referenced in this Declaration as attached hereto are hereby incorporated by reference.

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IN WITNESS WHEREOF, Declarant has caused this instrument to be executed on the day and year written below.

STATE OF TEXAS

COUNTY OF TARRANT

DECLARANT:

Bloomfield Homes, L.P., a Texas Limited Partnership

By: Bloomfield Properties, Inc., a Texas Corporation, its General Partner

By: ~// Name: ---~-'--------lS~teetiphen J. Corradi Title: Attorney In Fact

-------------iB~loo~mfield Properties, INC.

Date: May (1-1'), 2018 General Partner

IL. The foregoing instrument was acknowledged before me on this the /5 day of 111, , 20 ..!!_, by Stephen Corradi, Attorney in Fact of Bloomfield

Properties, Inc., on behalf of such entity and in the capacity therein stated.

AFTER RECORDING RETURN TO: Bloomfield Homes, LP 1050 E Highway 114, Suite 210 Southlake. TX 76092 Attn: Stephen Corradi

My Commission Expires: ____ _

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MORGAN HAMMONTREE Notary Public. State of Texas comm. Expires 08-26·201 S

Notary ID 129932313

EXHIBIT"A"

Legal Description and/or Depiction of the Property

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EXHIBIT"B"

Common Areas

Common Area lots are defined as any area denoted as Common Area on the Plat(s) and/or open space that is deeded to the HOA.

All Common Areas are to be maintained as deemed necessary by the Homeowners' Association.

37

EXHIBIT"C"

Ooen Space Area

(See Section 8.8)

lbis community has a common mailbox area(s). The mailboxes and the immediate area around the mailboxes are to be maintained by the HOA.

Open spaces shall include the entrance features, landscaping and other landscaped areas along the entrance at Timberbrook Parkway and FM 156. Additional open spaces/entrances may be added in conjunction with additional development.

38

EXHIBIT"D"

Subdivision Association Maintenance Fencing

(See Section 9 .6)

The Association shall have responsibility for the all exterior screening walls, entrances and certain exterior fences as defined by Exhibit D. Such exhibits and areas of maintenance shall be added as additional phases are annexed into the community.

Individual property owners shall be responsible for any fencing and/or Retaining Wall(s) located on their property. Neither the City of Justin nor the Homeowners' Association shall have maintenance responsibility for any Retaining Wall(s) constructed as part of this development unless such walls are on common areas as defined.

Maintenance for the ornamental metal fencing backing up to Timberbrook Parkway Phase IA (Lots 1-11, Block 1); Phase 1B (Lots 1-7, Block 4; Lots 1-8, Block 10) is the responsibility of the Homeowner' s Association. Additionally, the association will have responsibility for the rear fence line backing up to commercial property to be maintained by HOA as identified below: 8' fence along Lots 1-13; and Lot 30 in Block 3; Phase IA 6' fence along Lots 32-39 in Block 3; Phase IA

Individual property owners will be responsible for the maintenance of any other fencing and retaining walls located on their property.

39

EXHIBIT"D"

Subdivision Association Maintenance Fencing

(See Section 9 .6)

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EXHIBIT"D"

Subdivision Association Maintenance Fencing

(See Section 9.6)

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41,

Initial Building Guidelines

The following will serve as the Initial Building Guidelines as hereby set forth in the establishment of the Timberbrook community. Any modifications or adjushnentS to any LotS and/or Dwellings shall follow these Initial Building Guidelines and shall be subject to any and all qty rules and regulations and building codes, which City rules and regulations and building codes shall control and have authority over items .stated in these Initial Building Guideliries to the extent of any

. conflict or inconsistericy. See Ordinance No. 645-18 (attached below) along with City of Justin Code of Ordinances (Exhibit D - Development Conditions) for additional information.

Roofing Requirements

Roofing Material

Two Story Restrictions/Guidelines

Lot Fencing

Roof pitches shall be a minimum of6:12. Restrictions may be modified/increased b the Declarant/ ACA. Architectural shingles with a color similar to "Weathered Wood" or as a roved b ACA. Homes backing to primary parkways shall be restricted by review and approval by the ACA.during master plan approval. Plan restrictions may be imposed by the De.clarant and the ACA rocess. Standard lot fencing shall be 6' stained fence using a color similar to Ready Seal "Dark Walnut". Areas abutting a street shall have ihe smooth side out and a horizontal board along the outer edge to have the appearance of a flat top. All. fencin shall be sub"ectto the ACA.

The above Initial Building Guidelines may be modified by Declarant during Declarant control. period. In addition, Declatant shall modify, ifnecessary, to remain compliant with the any i:ules, regulations and/or building code of the City, FHA, FHLMC, FNMA, HUD, VA, Declarant and/or the ACA. ·

42

ORDINANCE No. l.Ol\ "J - \ CO

AN ORDINANCE OF THE CITY OF JUSTIN, TEXAS, AMENDING THE COMPREHENSIVE ZONING ORDINANCE AND MAP OF THE CITY OF JUSTIN, AS HERETOFORE AMENDED, BY APPROVING A PLANNED DEVELOPMENT DISTRICT ON 571.72 ACRES OF LAND FOR PROPERTY IN THE CITY OF JUSTIN, DENTON COUNTY, TEXAS; PROVIDING SPECIAL CONDIDONS; PROVIDING FOR THE REPEAL OF ALL ORDINANCES IN CONFLICT; PROVIDING A SEVERABILITY CLAUSE; PROVIDING FORA PENALTY OF FINE NOT TO EXCEED THE SUM OF TWO mousAND ($2,000.00) DOLLARS FOR EACH OFFENSE; AND PROVIDING AN EFFECTIVEDATE.

WHEREAS, the Planning and Zoning Commission of the City of Justin and

the City Council of the City of Justin, in compliance with the laws of the State ofTexas

with reference to the granting of zoning classifications and changes, have given the

requisite notices by publication and otherwise, and have held due hearings and afforded

a full and fair hearing to all property owners generally and to all persons interested

and situated in the affected area and in the vicinity thereof, and the City Council of the

City of Justin is of the opinion and finds that a zoning change should be granted and that

the Comprehensive Zoning Ordinance and Map should be amended; Now, Therefore,

BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF

JUSTIN, TEXAS:

SECTION 1. That the Comprehensive Zoning Ordinance and Map of the City

of Justin, Texas, as heretofore amended, be, and the same are hereby, amended by,

approval of a Planned Development District for the Timberbrook Development on

property described as a tract of 571.72 acres in the N.S. Hazleton Survey, Abstract

Number 547, M.E.P. & P.R.R. Co Survey, Abstract Number 1477, E. Young Survey

Abstract Number 1452, W.W. Young Survey, Abstract Number 1444, H. McDonald

Survey, Abstract Number 879, M. Garnett Survey Abstract Number 439, W. M. Reed

Survey, Abstract Number 1071, and R. W. Terrell Survey Abstract Number 1650,

Denton County, Texas., said property being more particularly described in Exhibit "A"

attached hereto and made part hereof for all purposes.

SECTION 2. That the property described may be used only for the

piirposes as set out by the "Timberbrook Zoning Change Exhibit" attached hereto as

Exhibit "B" and made part hereof for all purposes, subject also to the special

conditions set out herein.

SECTION 3. That the granting of such Planned Development District is

subject to the following special conditions:

A. Development of the property shall be in accordance with all provisions of

the Comprehensive Zoning Ordinance of the City of Justin, except as amended herein.

B. Development of the property shall be in accordance with the approved

Development Agreement attached as Exhibit "C."

SECTION 4. That all ordinances of the City of Justin in conflict with the

provisions of this ordinance or the Comprehensive Zoning Ordinance as amended

hereby be, and the same are hereby, repealed and all other provisions of the ordinanc.es

of the City of Justin not in conflict with the provisions of this ordinance or the

Comprehensive Zoning Ordinance as amended hereby shall remain in full force and

effect.

SECTION 5. That should any sentence, paragraph, subdivision, clause, phrase

or section of this ordinance be adjudged or held to be unconstitutional, illegal, or invalid,

the same shall not affect the validity of this ordinance as a whole, or any part or

provision thereof other than the part decided to be invalid, illegal or unconstitutional,

and the same shall not affect the validity of the Comprehensive Zoning Ordinance as a

whole.

SECTION 6. That any person, film or corporation violating any of the

provisions or terms of this ordinance or of the Comprehensive Zoning Or!linance, as

amended hereby, shall 'be subject to the same 'Pen<tlty as proviiled for in the

Comprehensive Zoning OriJinance ofthe City of Justin, Texas, as heretofore amended,

and,upon convii;tion shali be punished by a tme not to exceed the sum of Two Thousand

($2,0Q.O.OO) Dollars for each offeJ¥1e, and each al)d every day such a vio1ati,on is

continued ,shall be deemed to constitute a sepll!'ate offense.

SECTION 7. That this or,dinance shall take effect immediately from and after

its passage and the publication, of the ca,ption as the law in such cases provide.

PASSED AND APPROVED by the City Council of the City of Justin, Texas,

ATTEST; APPROVED AS TO FORM:

~~D.cl C»dwo City Secretafi,Bhttany Andrews City Attorney, Matthew Boyle

I DEVELOPMENT AGREEMENT 1

I This Development Agreement (this "Agreemenf') is executed amojig BLOOMFIELD

HOMES, L.P., a Texas limited partnership (''Bloomfield"), JUSTIN TIMBE!IBROOK, LLC., a Texas limited liability company ("Justin Timberbrook"; Bloomfield and Justin Timberbrook are herein collectively referred to as the "Owner'', which as used herein shall I include the current owners of the Property and their successors and pennitted assigns), and the City of Justin, Texas, a general law city (the "Qtt") (Owner and City being referred to individuall~ as a "Partv'' and collectively as the ''Parties"), to be effective on the Effective Date as defined i'n Section 13.10. - . I

RECITALS ! WHEREAS, Owner is the owner of approximately 571. 79 acres of truld (the '~,

as further defined herein) situated in the H. McDonald Survey, Abstract Num~er 879, M. Garnett Survey, Abstract Number 439, and R. W. Terrell Survey, Abstract Number 1650, Denton County, Texas (the "County") described by metes and bounds on Exhibit A _and shown on Exhibit B, which property is undeveloped; and !

WHEREAS, Owner intends that the Property be developed as a hi~h-quality, master­planned, residential community with minimum 7,000 square feet lots served ~y retail City water and sanitary sewer service, pursuant to development regulations contained f1 this Agrei:ment;

and I WHEREAS, the Owner and/or Its affiliates desire to acquire Addi~onal Property, as

hereinafter defined, to be developed in accordance with the terms of this A&i"eement and to be included in any public improvement district formed pursuant to Texas Local Government Code, Chapter 372 (the "PID Act") and the terms of this Agreement; and I

! WHEREAS, the Owner may request that the City Council add Additidnai Property to the

Property to be developed in accordance with this Agreement or petition to hate such Additional Property included in a public improvement district in accordance with the ~quirements of the PID Act, provided that such Additional Property is located within the cprporate limits or extraterritorial jurisdiction of the City and is developed and :financed in acbl ordance with the terms of this Agreement; and ,

! WHEREAS, the Owner may assign its rights under this agreement to Bloomfield for the

pmpose providing the terms of development for any Additional Property, and J.

. l WHEREAS, ~ Agreement will be recorded in the deed records of ilie County (so as to·

bind Owner and all future owners of the Property or any portion thereof),ll and will provide regulatory certainty during the term of this Agreement; and ,

I

WHEREAS, the City Council has determined that Owner may develoP, the Property with retail water and sanitary sewer service to the Property, provided Owner and tbe City determine that it is feasible for the City to be the retail provider and Owner constrdcts the necessary infrastructure, at Owner's expense; and !

i WHEREAS, the Parties intend that the City will be the sol~ retail pr\>vider of water and

wastewater service to the Property; and ! !

WHEREAS, Owner will construct or cause to be constructed the! infrastructure and improvements to serve the Property and the City shall have and exercise~· · sdiction over the development of the Property as set forth in this Agreement and the applicabl laws regarding the design, construction, installation, and inspection of water, wastewater, dra" ge, roadway, and other public infrastructure to serve the Property (collectively, the "Public I structure"); and

WHEREAS, the City Council has determined that this Agreement dd the development of the Property descnbed herein comply in all respects with the City's Comprernsive Plan; and

WHEREAS, pursuant to that certain Interlocal Cooperation Agreeme*t between the City and the County effective October 18, 2005 (the "Interlocal eemenf') and Section 242.00l(a)(3) of the Texas Local Government Code, the City has exclusiv jurisdiction over subdivision platting and all related permits for the Property; and

WHEREAS, the Parties desire for the Property to be developed thin the cmporate limits of the City, and that public improvement districts (herein after "PID" r "PIDs") created by available statutory means shall be created and utilized to aid in the d velopment of the Property, pursuant to the terms of this Agreement; and I

WHEREAS, at the City's request, Owner has agreed to petition the bty to annex any portion of the Property not currently in the City limits as consideration for tllis Agreement and creation and utilization of the PIDs; and \

WHEREAS, development of the Property within the City's corporate ~ts will increase the City's tax base, expand the customer base for the City's retail businesse~, and increase the City's population; and ,

I WHEREAS, the City intends that the City Council shall approve an of

1 dinance annexing

the Property not later January 1, 2017; and ,

WHEREAS, the Parties intend for the PIDs to provide and financJ a portion of the Public Infrastructure required to serve the Parties' intended development oftheJProperty; and

WHEREAS, due to the location and other natural features of the Proberty, funding the cost of the Public Infrastructure in accordance with this Agreement will illow the Parties' intended development of the Property to be accomplished sooner than it woulJ otherwise occnr; and

WHEREAS, in consideration of the Owner's agreements containedh ein, the City shall exercise its powers under Chapter 372, Texas Local Government Code, as~nded (the 'Tm Acf'), to provide a :financing vehicle that will enable the Owner to do the following in accordance with the procednres and requirements of the PID Act and this A ent: (a) fund or be reimbursed for the estimated costs of the Public Infrastructure using the! proceeds of PID Bonds; or (b) obtain reimbursement for the estimated costs of the Public ~structure, the

I I" ---~ -- .;.:--..:;:. - - --

source of which reimbursement will be installment payments from Asse4sments within the Property, provided that such reimbursements shall be subordinate to the paY111ent of Pill Bonds and Administrative Expenses; and ~

WHEREAS, the City Council, in accordance with the terms of this !Agreement and all legal and binding statutory and contractual requirements, intends to: (i) creatEne or more Pills which overlap all of the Property; (ii) adopt a Service and Assessment Plan for each Pill; (iii) adopt an Assessment Ordinance of each Pill (to pay for the estimated st of the Public Infrastructure associated with such PID and the costs associated with the a · · stration of the Pill and the issuance of the Pill Bonds); and (iv) issue, in multiple selies, acrJss all Pills created pursuant to this Agreement, the principal amount of PID Bonds that (a) arJ necessary for the purpose of financing the estimated costs of the Public Infrastructure and pa1g associated costs as desclibed herein, and (b) .can be supported by assessments corresponding t an equivalent tax rate ofup to $1.00 per $100 of assessed valuation within each Pill; and

WHEREAS, plior to the sale of the first Pill Bond issue for an3PID: (a) the City Council shall have approved and adopted the corresponding Pill Resol tion, Service and Assessment Plan and Assessment Ordinance (collectively, the "PID Doc ents"); (b) unless such requirement is waived by the City and the underwliter of the applicabllill Bonds, owners of the Property constituting all of the acreage in the PID at the time of the i suance of the first PID Bonds shall have executed a Landowner Agreement (as defined below); d (c) the Owner shall have delivered a fully executed copy of the Landowner Agreem s) to the City, if applicable; and I

!

WHEREAS, to the extent funds must be advanced to pay for any co~ts associated with the creation of any Pill, or the issuance of PID Bonds, or the preparation jof documentation related thereto, including any costs incurred by the City and its consultants 8fd advisors in the preparation and negotiation of this Agreement (excluding the fees associate~,, with closing !lllY Pill Bonds), the Owner shall be responsible for advancing such funds, shaJI have a right to reimbursement for the funds advanced from the proceeds of Pill Bonds or As~6sment revenues, to the extent allowed by law, and the City will not be responsible for such reiursement or the payment of such costs from any other sources of funds; and .

WHEREAS, the Owner plans to develop the Property upon the Lxecution of this Agreement and subsequent issuance of PID bonds by the City for the p{yment of certain estimated costs for the construction and acquisition of certain Public Jnfrastrucrire to benefit the Property, and for the repayment to Owner for certain costs advanced for th9 construction and acquisition of certain Public Infrastructure to benefit the Property as set forth r the Service and Assessment Plan for the Pill(s) ("Service and Assessment Plan''); and

WHEREAS, the City recognizes the positive impact that the Pub c l~cture for the development contemplated herein will bring to the City and reco · es further that the development will promote state and local economic development; ·mu! te business and commercial activity in the municipality; advance the development an div~ification of the economy of the state; advance development and expansion of co · the state; and contnbute to the elimination of unemployment or underemployment in th sta , and

I

WHEREAS, the City agrees that, upon the petition of any of the Jan~owners within the Property or Additional Property, it shall agree to consider the creation of a J:!ew PID within the Property or redefine the boundaries of any PID so as to allow the PID to cotjtain an appropriate boundary description to aid in the .efficient development of the Property to the extent allowed by law; and '

WHEREAS, the Parties intend that this Agreement be a developihent agreement as provided for by Section212.172 of the Texas Local Government Code; and !

I

WHEREAS, the Parties have the authority to enter into this A~ement pursuant to Section 212.171 et seq. of the Texas Local Government Code. 1.

NOW THEREFORE, for and in consideration of the mutual covenants of the Parties set forth in this Agreement, and for other good and valuable consideration, the rej:eipt and adequacy of which are acknowledged and agreed by the Parties, the Parties agree as follqws:

ARTICLE I. DEFINITIONS

Unless the context requires otherwise, the following terms shall have the meanings hereinafter set forth: !

Additional Property shall mean any property acquired by the Owne~ and made subject to this Agreement pursuant to Section 3.05 hereof. '

Administrative Expenses shall mean, with respect to any PID, expen$es incurred in the establishment, administration, and operation of the PID. '

Assessment means a special assessment levied by the City within a Prb as authorized by the PID Act, pursuant to the Assessment Ordinance related to such PID. !

Approved Plats means the final plats for areas within the Property that are approved, from time to time, by the City. i

Assessment Company means an assessment firm that is experiehced in PID and assessment administration and acceptable to the City and Owner. !

Assessment Ordinance means, with respect to any PID, the ordinanc~ approved by the City Council which levies special assessments on the Property associated *'-'i.th such PID in accordance with the PID Act to pay for the estimated costs of the Public Infriistructure set forth in the Service and Assessment Plan, Administrative Expenses as well arJ any other costs associated with the issuance of the PID Bonds that provide a special benefit to such property within the PID. '

Assessment Roll means, with respect to any PID, an Assessment Rqll attached to the Service and Assessment Plan associated with such PID, or any other Assei\sment Roll in an

amendment or supplement to snch Service and Assessment Plan or in an a.Dnual npdate to the Service and Assessment Plan, showing the total amonnt of the Assessment ~gainst each parcel assessed nnder the Service and Assessment Plan related to the Pnblic Infrastructure.

Bond Counsel means Winstead PC.

Q!Y means the City of Justin, a general law municipality located jn Denton Connty, Texas. '

City Manager means the current or acting City Manager of thei City or a person designated to act on behalf of that individual if the designation is in writing and signed by the current or acting City Manager. !

City Council means the City Connell of the City.

City Secretary means the City Secretary of the City.

Effective Date has the meaning set forth in Section 13.10.

End Buyer means any owner, developer, tenant, user, or occupant ofia Fully Developed and Improved Lot. ;

ETJ means extraterritorial jurisdiction.

Fully Developed and Improved Lot means any lot, regardless of proposed use, which is served by the Public Infrastructure and for which a final plat has been approv~d by the City and recorded in the real property records of Denton County. ·

Governing Regulations has the meaning set forth in Section 2.01.

Home Buyer Disclosure Program means the disclosure program, administered by the Assessment Company, that establishes a mechanism to disclose to each End Buyer the terms and conditions under which their lot is burdened by any PID contemplated by this 4-greement.

Improvement Account of the Project Fund means, with respectj to any PID, the construction fund account created nnder the Indenture associated with such PJp used to pay for the construction or acquisition of the Public Infrastructure. ·

Indenture means, with respect to any PID, an indenture under whiJh PID Bonds are issued. '

Landowner Agreement means, with respect to any PID, the agreetj:lent of all of the Owners of the Property consenting to the fonn and terms of the related PID Do?uments.

Mayor means the Mayor of the City.

,. \.

Notice means any notice required or contemplated by this Agreement (or otherwise given in connection with this Agreement). 1

Owner means Bloomfield and its successors and/or assigns, and Justiji Timberbrook and its successors and/ or assigns. ·

PID or Pills means any public improvement district or districts coptemplated by this Agreement to be created by the City for the benefit of the Property pursuapt to Chapter 3 72, Texas Local Government Code.

PID Act means Chapter 372, Texas Local Government Code, as amended.

PID Administrator means an employee or designee of the City, including a consultant engaged by the City for such purposes, who, with respect to any PIJ!>, shall have the responsibilities provided in the related Service and Assessment Plan, Indeiiture, or any other agreement or document approved by the City related to the duties and resppnsibilities for the administration of the PID. \

PID Bonds means, with respect to any PID, assessment revenue bond~ issued by the City and secured by the Assessments levied within such PID. '

PID Resolution means, with respect to any PID, the resolution and ii:nprovement order adopted by the City Council creating the PID pursuant to Section 372.010 of the PID Act and approving the advisability of the related Public Infrastructure. ·

Plat Review Fees shall have the meaning set forth in Section 4.01.

~means the 571.79 acres of undeveloped property located ~holly in Denton County, Texas and descn'bed by metes and bounds and depicted on Eibibit A and any Additional Property. Property shall also mean that portion of the Property a~sociated with any PID, as the context requires. ·

Public Infrastructure means water, sewer, drainage, roadway or othc1r facilities needed to serve the Property and to be constructed by or on behalf of the City, includillg pursuant to any PID, including road improvements, utility improvements and other improvembnts authorized by the PID Act and benefiting the Property. I

Public Infrastructure Costs means the estimated costs of the Putjlic Infrastructure, including design, engineering, construction, and inspection costs. i

Service and Assessment Plan means, with respect to any PID, the!PID Service and Assessment Plan, to be adopted, updated or amended annually, if needed, byj the City Council pursuant to the PID Act for the purpose of assessing allocated costs agains~ property located within the boundaries of the PID(s) having terms, provisions and findings app*oved by the City, as required by this Agreement.

:[

:1

~ means every structure designed or intended for human oceupancy and every accessory structure intended for human occupancy.

Subdivision Regulations shall have the meaning set forth in Section 2.0l(a).

TCEO means the Texas Commission on Environmental Quality.

ARTICLE II. DEVELOPMENT REGULATIONS

Section 2.01 Governing Regulations. The Property shall be deve)oped as a single­family residential development. The Property will be developed with r.ooo square feet minimum lots with retail City water and sewer service. Development of the Property shall be governed solely by this Agreement and the following regulations (col!ectivelr, the "Governing Regulations''):

(a) the City's Subdivision Regulations, consisting of Ordinance No. 248 elrective March 24, 1997, as it may be amended from time to time, now codified io Chapter 9 of the Justin Code of Ordinances, and all other subdivision-related provisions of t4is Agreement (the "Subdivision Regulations") attached as Exhibit C, provided that to the extent that the Subdivision Regulations conflict with this Agreement, this Agreement ~hall control;

(b) building, plumbiog, electrical, mechanical, and fire codes adoptedi by the City and uniformly enforced within the City's corporate boundaries, as may be ~ended from time to time, and any subsequently adopted local amendments to the building, fire, electrical, plumbiog, mechanical, or other applicable codes and ordinances of: the City that are uniformly applicable to similarly situated development within th~ City's corporate boundaries (the "Building Codes"); ·

(c) development standards attached as Exhibit D (the "Development Standards'');

( d) Street Standards io the Subdivision Regulations as modified by the prohsions attached as Exhibit E (the "Street Standards"); '

(e) water and sewer standards in the Subdivision Regulations as modifiediby the provisions attached as Exhibit F (the "Water and Sewer Standards"); ·

(:f) miscellaneous development conditions attached as Exhibit G (the "Miscellaneous Conditions"); ·

(g) Drainage Standards in the City's Subdivision Regulations, Article 3.490 of the Code of Ordinances, and the Flood Damage Prevention Regulations (the "Drabiage Standards''); and '

(h) final plats for portions of the Property that are approved, from time to like, by the City in accordance with this Agreement (each an "Approved Piaf'). ·

--"·~----··

l· ..

1.:

Section 2.02 Zoning. In the event of any conflict between this Agreement and any ioning ordinance adopted by the City Council applicable to the Property, th~ provisions of this Agreement will prevail, except as expressly agreed in writing by Owner,! the City, and the owners of tlie portion of tlie Property subject to such zoning ordinance.

Section 2.03 Conflicts. In the event of any conflict between this 4greement and any oilier ordinance, rule, regnlation, standard, policy, order, guideline or other CifJ:'.-adopted or City­enforced reqillrement, whether existing on the Effective Date or hereinafter adopted, this Agreement shall control, except as otherwise expressly provided in this Agredpient. In the event of any conflict between any provision of the Agreement and the Governing Regulations, the provision of the Agreement shall prevail. ·

ARTICLE ill. DEVELOPMENT PROCESS

Section 3.01 Jurisdiction. Pursuant to the Interlocal Agreement, whi~h grants exclusive authority to the City pursuant to Section 242.00l(d)(l) of the Texas Local 6overmnent Code, and Section 242.00l(a)(3) of the Texas Local Government Code, the City shalj have and exercise exclusive jurisdiction over the review and approval of preliminary and finiU plats, amending plats, replats and minor replats for the Property and approval of plans for certain Public Infrastructure in accordance with this Agreement, and the County shall ha-vie and exercise no jurisdiction over such matters during the term of this Agreement. I

Section 3. 02 Plats and Plans Required. Subdivision of the Prop~rty shall reqillre approval of preliminary and fmal plats by the City in accordance with the Gov~ng Regulations and this Agreement. ·

(a) All Public Infrastructure constructed or caused to be construct~d by Owner shall be designed and constructed in compliance with the Governing Regnlations. i

j

(b) Owner shall submit to the City plans and speci:ficatio~ for the Public Infrastructure prior to commencing construction, advertising for bids or reque~ting proposals for such improvements. No advertising for bids or requests for proposal shall btj delivered and no construction shall commence until the related plans and specifications have been approved in writing by the City Engineer or designee. '

(c) The City Engineer or designee shall approve or disapf,rove plans and specifications, including resubmittals, within thirty (30) days after receipt of~ complete set of plans and supporting documents. In the event the City Engineer disapproves [of any plans and specifications, the disapproval notice shall contain a detailed explanation of\the reason(s) for disapproval, which shall be limited to the failure of such plans and specificatio*8 to comply with one or more of the Governing Regulations or for life, safety, health or gener~l welfare reasons which would require disapproval for a project in the City. If the plans or sp~cifications do not comply with the Governing Regulations or the life, safety, health or general welfare reasons as stated in the disapproval notice, the Owner shall revise the plans and specificati\:ins appropriately and resubmit to the City Engineer for review with any required additional review fee.

!

Section 3.03 Bonds, Irisurance and Inspection of Public In:frastructwfe. When the plans and specifications have been approved and before any permit is issued for co*struction of public infrastructure on the Property, Owner shall submit to the City a Maintenance Bond, in a fonn acceptable to the City, in the sum of one hundred per cent (100%) of the totf contract price for construction of such infrastructure and conditioned that the contractor will 'Wair or replace all defects due to faulty material and/or workmanship that appear within two yea;rs from the date of final approval by the City. Owner shall procure and maintain in force ~ublic liability and property damage insurance with limits at least equal to the maximum ampunt of the City's statutory liability under Chapter 101 of the Civil Practice and Remedies Codei

1 and with the City

of Justin, its officers, employees, and agents listed as additional insiped. All Public Infrastructure shall be inspected and tested for compliance with the Gov~ Regulations at Owner's cost by a City employee or third party inspector retained by the City. 1

iii Section 3.04 Building Permits; Inspection of Structures.

( d) Owner shall not construct, or allow to be constructed, on ie portion of the Property owned by such Owner, a Structure until a permit is issued by the Cit}j certifying that the plans and specifications for the Structure are in compliance with the B~ilding Codes and Development Standards (a "Building Permif'). '

(e) At the City's option, Building Permits may be issued by a cfty employee or a third party contractor retained by the City. I

I (f) Each Structure shall be inspected for compliance with the Buil<fing Permit issued

for the Structure and the applicable plans and specifications, Codes and ordinances. At the City's option, inspections may be peifonned by a City employee or by a third party 4ontractor retained by the City. !

Section 3.05 Additional Propertv. To the extent the Owner, its succe~ors or assigns, or an affiliated entity of the Owner acquires additional property in the corpo\,ite limits or the extraterritorial jurisdiction of the City, or the Owner, its successor or assigi;i., or an affiliated entity of the Owner acquires additional property within one (I) mile of the Ci~'s extraterritorial jurisdiction and petitions the City for inclusion of such additional property inf' e extraterritorial jurisdiction of the City or annexation of such additional property into the corp rate limits of the City ("Additional Property''), Owner may request that the City Council allo

1 such Additional

Property to be subject to and developed in accordance with the specifications <!>fthis Agreement upon the execution of an amendment to this Agreement pursuant to Section 13.05 hereof. If the Additional Property added is not contiguous to the boundaries of any existi~g PID, the City Council agrees to consider the creation of a separate PID over the Additiqna! Property not contiguous to the boundaries of any existing PID. l

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ARTICLEN. DEVELOPMENT FEES

Section 4.01 Plat Review Fees. Development of the Property shi!il be subject to payment to the City of the reasonable and customary fees and charges applic!Wle to the City's preliminary and final plat review and approval process (the "Plat Review Fees") according to

the fee schedule adopted by the City Council and in effect on the date of sul:>mittal of each plat application. The fee schedule uniformly applicable to development within th~ corporate limits of the City shall be applicable to the Property. '

Section 4.02 Plan Review Fees. Development of the Property ~all be subject to payment to the City of the reasonable and customary fees and charges appl)cable to the City's review of plans and specifications for Public Infrastructure (the "Plan Review Fees") according to the fee schedule adopted by the City Council and in effect on the date of s~bmittal of each set of plans and specifications. The fee schedule unifoxmly applicable to devefopment within the corporate limits of the City shall be applicable to the Property. Owner will also be responsible for fees equal to 4% of the infrastructure cost for public infrastructure inspebtion by the City's designated inspector, plus laboratory and material testing deemed neces~ary by the City's inspector. i.

· Section 4.03 Impact Fees. The City acknowledges and agrees that Owner is providing certain capital improvements to the City at the cost of the Owner and, as conhlderation for such capital improvements, no water, sewer or road impact fees shall be charg~ on the first 250 single-family residences or equivalents constructed on the Property. For !:ach single-family residence or equivalent constructed on the Property in excess of250, the Owr\er shall pay, at the then-current rate, all water, sewer, and road impact fees chru·ged by the City in accordance with Chapter 395, Texas Local Government Code. · i

Section 4.04 Park Land Dedication. Owner shall offer park land fo~ dedication in the final plat to the City in accordance with the City's park dedication requirement~ in effect as of the Effective Date and the Owner's development plan. The current Park! Land Dedication requirements are contained in Chapter 9, Article 8 of the Justin Code of Ordinapces.

Section 4.05 Payment of Fees. Except for the fees set out above, no!fees or charges of any kind are due and payable to the City in connection with the development pf the Property so long as it remains in the extraterritorial jurisdiction of the City. When the Pt!operty is annexed into the City, Owner agrees to file an application for permanent zoning of tJ'.e Property into a Planned Development as provided in the Comprehensive Zoning Ordinanci:: and to pay the required fees for the zoning application, Plat Review Fees, utility fees, buildin~ fees and all other normal and customary fees of the City required for development of property ~ the City in effect at the time of such annexation. I

ARTICLEV. i PUBLIC INFRASTRUCTURE; RETAIL UTILITY SERVICE

! Section 5.01 Retail Water Service. City retail water service shall bb extended to the

Property or to the portions of the· Property located within the City's water Cof service area and the rates for the water shall be at the City's generally applicable in-city rates. \ Extension of the services shall be at the sole expense of the Owner and eligible for acquisition pr reimbursement by the PID. ;

Section 5.02 Retail Sewer Service. Sanitary sewer service to the hoperty shall be provided by the City, provided that Owner constructs, at Owner's expens~ and eligible for

I i

acquisition or reimbursement by the PID, all infrastructure determined ~y the City to be necessary to connect to the City's sewer system. i

Section 5.03 Roadways.

(a) The Property is currently bordered on the east by FM 156 on the sobth by FM 407 (the "Perimeter Roads") and on the west by the City limits as tlliey exist after the annexations provided for herein are complete. Owner shall constru~t improvements to the Perimeter Roads and dedicate right-of-way related to the Perijneter Roads to the City, as required by the Street Standards.

(b) Owner shall dedicate all right-of-way to the City and construe~ all internal roads within the boundaries of the Property in accordance with the Stre~ Standards and the Drainage Standards (if applicable). i

Section 5.04 ~· Owner shall construct drainage improveme*ts on the Property in accordance with the Drainage Standards. \

Section 5 .05 Dedication. Ownership and Maintenance of Public Infrastructure; Capacity. Owner shall dedicate by final plat the Public Infrastructure to the Cify.

Section 5.06 Oversized ln:frastructure. The Public Infrastructure sh~ include, but not be limited to, all water, wastewater, drainage facilities, storm water :fytcilities, roadway infrastructure or other public infrastructure authorized by law necessary for, Of for the service of and of benefit to, and located within the Property. Owner shall not be requited to construct or fund, nor shall the proceeds of PID Bonds be used to fund, any ov~izing of Public Infrastructure necessary to provide a benefit to land outs:ide the Property or <rhich exceeds the capacity needed to serve the Property, unless, at the completion of constructiori, the City pays the Owner in full the increased cost directly attributable to the oversizing requeste<). by the City.

i Section 5.07 Public Infrastructure funding through PID Bonds. The (j)wner will design,

construct, and install the Public Infrastructure using funds advanced by Own~ or the c;:ity will utilize lawfully available funds from PID Bond proceeds or Assessments for iiuch construction; and the City will thereafter acquire the Public Infrastructure and reimbur~e Owner for any advances or, if PID Bond proceeds are available, the City will pay the estin:!ated costs for the construction of Public Infrastructure using the proceeds of PID Bonds issued by the City and secured solely by special assessments levied on Property within the PID. Hoirever, this design, construction and installation in no way affects the rights of the City to detenmbe and enforce the Governing Regulations, including but not limited to specifications as well ias the inspection process. After inspection and acceptance, the City shall own and maintain [ all of the Public Infrastructure. The Public Infrastructure to be funded with Assessments and/o)" proceeds of PID Bonds may consist of any projects authorized by the PID Act. i

ARTICLE VI. PUBLIC IMPROVEMENT DISTRICTS; PID BONDS

Section 6.0 I Creation and Levv of Assessments. The City shall use !its best efforts to initiate and approve all necessary documents and ordinances required t& effectuate this

Agreement, to create any necessary PID or PIDs upon petition by the Owne~ or its designees or assigns, and to levy the Assessments associated with such PID or Pills. \For each PID, the Owner will prepare or cause to be prepared, and the City will approv~ the Service and Assessment Plan and Assessment Roll providing for the levy of the Assessmehts on the Property within such Pill. Promptly following preparation and approval of a preiirlnnary Service and Assessment Plan acceptable to the Owner and the City and subject to Cify Council making findings that the Public Infrastructure confer a special benefit on the PropeJtY, the City Council shall consider an Assessment Ordinance for each Pill. The City agrees to follow the statutory procedures to consider the resolutions and ordinances necessary to create and ~How the operation of the Pills located within the Property and retain qualified engineering, assessment and legal professionals, including bond counsel, recommended by Owner for the operation and issuance of bonds by the Pills. The expense of the professionals and the operations ~f each Pill shall initially be borne by Owner and reimbursed or paid from the issuance of Pill Bonds. The City Council shall have the right to engage issuer's counsel related to the issuance ~f Pill Bonds, and such counsel's fees shall be payable from the issuance of PID Bonds. Nothing contained in this Agreement, however, shall be construed as creating a contractual obligatfon that controls, waives, or supplants the City Council's legislative discretion or functions. i

i Section 6.02 Owner Obligations. Concurrently with the levy of the .t}ssessment for any

Pill, the Owner shall approve and accept in writing the levy of the Assessmen~ on all land owned by the Owner in such PID and shall approve and accept in writing the associated Home Buyer Disclosure Program and shall cause to be recorded against the applicable ~roperty covenants running with the land that will bind any and all current and successor Owners!and owners of the Property to: (i) pay the Assessments, with applicable interest and penalties thdreon, as and when due and payable hereunder and that the purchasers of such land take their t\tle subject to and expressly assume the terms and provisions of such assessments and the liens ci!eated thereby; and (ii) comply with the Home Buyer Disclosure Program. \

i Section 6.03 Pill Bond Issuance. Subject to the satisfaction of conditions set forth in

this Section, the City may issue PID Bonds solely for the purposes of acquirib.g or constmcting Public Infrastructure or any other purposes authorized by the PID Act. The tjwner may request issuance of PID Bonds by any PID by filing with the City a list of the Public Infrastructure to be funded with the PID Bonds and the estimated costs of such Public Infrastrubture. The Owner acknowledges that the City may require at that time a professional servic.k agreement that obligates the Owner to fund the costs of the City's professionals relating to the preparation for and issuance of PID Bonds, which amount shall be agreed to by the Parties and considered a cost payable from such PID Bonds. The City shall use its best efforts to issue, in multiple series, across all PIDs created pursuant to this Agreement, the principal amount of PID Bonds that (a) are necessary for the purpose of financing the costs of the Public In:frastn!cture and paying associated costs as described herein, and (b) can be supported by assessments\ corresponding to an equivalent tax rate of up to $1.00 per $100 of assessed valuation within eal:h PID, including the tax rate levied by the City, currently estimated to be a total equivalent agilregate tax rate of $3.05 per $100 of assessed valuation by all taxing entities and the PID or sich other number agreed to by both the Owner and the City Council, provided this estimate is ~ot binding on the City Council in its establishment of an ad valorem tax rate annually for the Cify,. The issuance of PID Bonds by any PID is subject to the following conditions: 1

(a) the adoption or amendment of a Service and Assessment Plan, Asses;sment Roll, and an Assessment Ordinance; ·

(b) each series of PID Bonds shall be in an amount estimated to be sufficient to fund the Public Infrastructure or portions thereof for which such PID Bonds are!being issued;

( c) delivery by the Owner to the City of a certification or other \mdence from an independent appraiser acceptable to the City confm:ning that thf special benefits conferred on the properties being assessed for the Public Infrastructure increase the value of the property by an amount at least equal to the amount assessed aga~ such property;

(d) approval by the Texas Attorney General of the PID Bonds and re~tration of the PID Bonds by the Comptroller of Public Accounts of the State of Texas; ·

( e) the Owner is current on all taxes, assessments, fees and obligations to tjie City;

(f) the Owner is not in default under this Agreement;

(g) no outstanding PID Bonds are in default and no reserve funds have b~n drawn upon that have not been replenished; i

: (h) review and approval by the City of the plats and construction pli\ns for the Public

Infrastructure; '

(i) the PIO Administrator has certified that the costs of the Public Infrasjructure to be paid from the proceeds of the PIO Bonds are eligible to be paid with the prc!ceeds of such PIO Bmds; '

G) the Public Infrastructure to .be financed by the PID Bonds have! been or will be constructed according to the approved design specifications and con*1iction standards imposed by this Agreement including any applicable Governing Regujations, confirmed by an engineering report from the City Engineer; \

(k) the City has determined that the amount of proposed PID assessments \and the structure, terms, conditions and timing of the issuance of the PID Bonds are rJeasonable for the project costs to be financed and the degree of development activity w\thin the PID, and that there is sufficient security for the PIO Bonds to be creditworthy; :

(I) the maximum maturity for PIO Bonds shall not exceed 30 years from ~e date of delivery thereof; i

l (m)unless otherwise agreed to by the City, the PID Bonds shall be offereq and sold only to

qualified institutional buyers or accredited investors as such investol-s are defined in compliance with applicable securities laws; I

(n) no information regarding the City, including without limitation finaricial information, shall be included in any offering document relating to PIO Bonds with~ut the consent of the City; ,

( o) simultaneous with closing the PID Bonds, Owner shall fund or caus~ the funding of the Public Infrastructure financed by the PID Bonds to the extetjt that the Public Infrastructure has not already been completed and paid for by Owne~ and, to the extent required by the City's Financial Advisor, in the event that the PID Bonds are insufficient to fund such Public Infrastructure, the Owner shall deposit funds neciessary to complete the applicable Public Infrastructure in escrow with the Trustee for )he applicable PID Bonds; and '

i (p) the Owner agrees to provide periodic information and notices ~f material events

regarding the Owner as it relates to the development of the Propertyj within any PID in accordance with Securities and Exchange Commission Rule l 5c2-12 and any continuing disclosure agreements executed by the Owner in connection with ti1e issuance of PID Bonds. ·

ARTICLE VII. PAYMENTS FOR AUTHORIZED IMPROVEMENTS; INCIDENTAL INCOME;

OWNERSHIP.

Section 7.01 Improvement Account of the Project Fund. The Improvement Account of the Project Fund for each issue of PID Bonds shall be administered and conblled by the City and funds in the Improvement Account of the Project Fund shall be deposite~ and disbursed in accordance with the terms of the Indenture associated with the PID Bonds: issued to finance property in such PID.

Section 7.02 Cost Overrun. If the total cost of the Public Infrastructure in the aggregate for a: PID exceeds the total amount of monies on deposit in the Improveme):it Account of the Project Fund, the Owner shall be solely responsible for the remainder of the c~ts of such Public Infrastructure, except as provided in Section 7 .03 below. '

Section 7.03 Cost Underrun. Upon the final acceptance by Citr of any Public Infrastructure and payment of all outstanding invoices for such Public Infrastrdcture, if the actual costs of such Public Infrastructure is less than the budgeted costs (a "Cost !underrun"), any remaining budgeted amount will be available to pay Cost Overruns on '!any other Public Infrastructure for the associated PID. The City shall promptly confirm to the ~stee of the PID Bonds issued to finance such Public Infrastructure that such remaining amoun:ts are available to pay such Cost Overruns, and the City, with input from the Owner, will decidb how to use such moneys to secure the payment and performance of the work for other Publicl Infrastructure, if available. f

Section 7. 04 Remainder for Public Infrastructure. If funds remain ml the Improvement Account of the Project Fund related to the PID Bonds issued by any PID after ~e completion of all Public Infrastructure and the payment of all Public Infrastructure Costs f<iir such PID, then such funds shall thereafter be the exclusive property of the City and shall be us\::d by the City for the purpose of paying or retiring the PID Bonds as provided in the related Inqenture or Service and Assessment Plan, or any other use applicable and of benefit to the Propeicy as provided by the PID Act or other law. !

Section 7.05 Incidental Income. The City acknowledges that the Owner may constmct, at the cost of the Owner, a water tower (the "Water Tower") to be dedicated to the City. In the event that the City should ever realize any incidental income from the Water Tower or any portion thereof unrelated to the primary function and services originally intended to be provided by Water Tower or applicable portion thereof (such as, by way of example and not limitation, any income received by the City for lease or license of a portion of the Water Tower for cellular and/or satellite relay, transmission facilities, or signage) other than statutory or regulatoiy permit fees or other similar fees collected by the City in the performance of a governmental function as opposed to a proprietary function, the City shall allocate and pay to the 0\vner fifty percent (50"/o) of such incidental income collected within in sixty (60) days following receipt thereof by the City. The Public Infrastructure funded by tax-exempt PID Bonds shall not be utilized to produce incidental income to private users unless the City first obtains, at its cost, an opinion of Bond Counsel stating that such use of the Public Infrastructure will not jeopardize the tax­exempt status of the relevant PID Bonds.

Section 7 .06 Ownership; Maintenance and Oneration. All of the Public Infrastructure shall be owned by the City upon completion of construction and acceptance of them by the City. The Owner agrees to take any action reasonably required by the City to transfer or otherwise dedicate or ensure the dedication of easements for the Public Infrastructure to the City and the public. Upon inspection, approval, and acceptance of the Public Infrastructure or any portion thereof, the City shall maintain and operate such Public Infrastructure to service the Property.

Section 7.07 No Limitation on Citv's Rights as the Retail Water and Wastewater Provider. Nothing in this Article VIl is intended to limit any right the City has under its water and/or wastewater CCN as the retail provider of water and wastewater service to the Property.

ARTICLEVIlI. TERM OF AGREEMENT; TERMINATION

Section 8.01 The term of this Agreement shall be thirty (30) years after the Effective Date or upon issuance of the final series of PID Bonds to finance Public Infrastructure, whichever is longer, unless extended by mutual agreement of Owner and the City (as extended, the ''Term"). Upon expiration of the Term, the City shall have no obligations under this Agreement with the exception of (i) maintaining and operating the PID in accordance with the Service and Assessment Plan and the Indenture and (ii) the maintenance and operation of the Public Infrastructure.

Section 8.02 Termination of Agreement. This Agreement may be tenninated as to all of the Property (a) at any time by mutual written consent of the City and Owner or for any uncured default in performance of the terms and conditions of this Agreement in accordance with Article X.

ARTICLE IX. ANNEXATION

Section 9.01 Annexation.

(g) Owner shall, no later than October 1, 2016, submit a petition to the City requesting annexation of the Property.

(h) The City may not annex the Property until all of the conditions hereof are satisfied with respect to the Property. The City shall follow the annexation process set out in Section 43.061, et seq., of the Texas Local Government Code.

ARTICLEX. EVENTS OF DEFAULT; REMEDIES

Section 10.01 Eveuts 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 (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 thirty (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.

Section 10.02 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 ANY 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. NOTWITRSTANDING THE FOREGOING, HOWEVER, NO DEFAULT UNDER THIS AGREEMENT SHALL:

(i) entitle the aggrieved Party to terminate this Agreement; or

G) entitle the aggrieved Party to suspend performance under this Agreement unless the portion of the Property for which performance is suspended is the subject of the default (for example, the City shall not be entitled to suspend its performance with regard to the development of "Tract X" by "Developer A" based on the grounds that Developer A is in default with respect to any other tract or based on the grounds that any other developer is in default with respect to any other tract) unless the default is in the nature of the failure to undertake a shared obligation as between such tracts or developers; or

(k) adversely affect or impair the current or future obligations of the City to provide water service to any portion of the Property within its water CCN; or

(I) entitle the aggrieved Party to seek or recover monetary damages of any kind; or

(m) limit the Term.

ARTICLE XI. ASSIGNMENT AND ENCUMBRANCE

Section 11.01 Assiwment by Owner to Successor Owners. Owner 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 Owner 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 Owner. Each assignment shall be in writing executed by Owner 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 to such Assignee. A copy of each assignment shall be provided to all Parties. Provided that the Assignee assumes the liabilities, responsibilities, and obligations of the assignor under this Agreement as to the Property or portion of the Property in question, the Owner will be released from any rights and obligations under this Agreement as to the portion of the Property involved in such assignment, effective upon receipt of a copy of the assignment by the City. It is specifically intended that this Agreement and all terms, conditions, and covenants herein shall survive a transfer, conveyance or assignment occasioned by the exercise of foreclosure of lien rights to a creditor or a party hereto, whether judicial or nonjudicial, as evidenced by consent to this Agreement by all lien holders against the Property as of the Effective Date subordinating such liens to this Agreement. No assignment by Owner sliall release Owner from any liability that resulted from an act or omission by Owner that occurred prior to the effective date of the assignment. Owner shall maintain true and correct copies of all assignments made by Owner to Assignees, including a copy of each executed assignment and the Assignee's Notice information as required by this Agreement. Owner hereby represents and warrants that there are no liens against the Property to secure loans, as of the Effective Date.

Section 11.02 Assignment by the City. The City shall not assign this Agreement, in whole or in part, and including any obligation, right, title, or interest of the City under this Agreement, without the prior written approval of Owner.

Section 11.03 Encumbrance by Owner and Assignees. Owner has the right, from time to time, to collaterally assign, pledge, grant a lien or security interest in, or otherwise encumber any of its rights, title, or interest under this Agreement for the benefit of its lenders without the consent of, but with prompt written notice to, the City, and in no event provided later than ten (10) days after any such encumbrance takes effect. The collateral assignment, pledge, grant of lien or security interest, or other encumbrance shall not, however, obligate any lender to perform any obligations or incur any liability under this Agreement unless the lender agrees in writing to perform such obligations or incur such liability. Provided the City has been given a copy of the documents creating the lender's interest, including Notice (hereinafter defined) information for the lender, then that lender shall have the right, but not the obligation, to cure any default under this Agreement and shall be given a reasonable time to do so in addition to the cure periods otherwise provided to the defaulting Party by this Agreement; and the City agrees to accept a cure offered by the lender as if offered by the defaulting Party. A lender is not a Party to this Agreement unless this Agreement is amended to add the lender as a Party. Notwithstanding the foregoing, however, this Agreement shall continue to bind the Property and shall survive any transfer, conveyance, or assignment occasioned by the exercise of foreclosure or other rights by a

lender, whether judicial or non-judicial. Any purchaser from or successor owner through a lender of any portion of the Property shall be bound by this Agreement and shall not be entitled to tbe rights and benefits of this Agreement with respect to tbe acquired portion of the Property until all defaults und~r this Agreement with respect to the acquired portion of the Property have been cured.

Section 11.04 Encumbrance by Citv. The City shall not collaterally assign, pledge, grant a lien or security interest in, or otherwise encumber any of its rights, title, or interest under this Agreement without Owner's prior written consent

ARTICLE XII. RECORDATION. RELEASES. AND ESTOPPEL CERTIFICATES

Section 12.01 Binding Obligations. Pursuant to the requirements of Section 212.172( c) of the Texas Local Government Code, this Agreement and all amendments hereto shall be recorded in the deed records of the County. In addition, all assignmenfu of this Agreement shall be recorded in the deed records of the County and a copy of the recorded assignment shall be delivered to the City as a condition to the City having notice of the assignment or having the assignment binding upon the City. This Agreement, when recorded, shall be binding upon the Property, the Parties, and all successor Owners of all or any part of the Property, provided, however, this Agreement $all not be binding upon, and shall not constitute any encumbrance to title as to, any End-Buyer except for the land use and development regulations that apply to specific lots. An End-Buyer shall not be considered an Owner. For purposes of this Agreement, the Parties agree: (a) the term "End-Buyer" means any tenant, user, occupant, or owner that is intended to be a final user, of a fully developed and improved lot and does not include a builder; (b) the term "fully developed and improved lot" means any lot, regardless of proposed use, for which a final plat has been approved by tbe City and recorded in the County's real property records; and ( c) the term "land use and development regulations that apply to specific lots" means all of the Governing Regulations.

Section 12.02 Releases. From time to time upon written request of Owner, the Mayor and City Manager, or designee of their choice, shall execute, in recordable form, subject to approval as to form by the City Attorney, a partial release of this Agreement if the requirements of this Agreement have been met, subject to the continued application of the Building Codes and the Development Regulations.

Section 12.03 EstoWel Certificates. From time to time upon written request of Owner, the Mayor and the City Manager, or a designee of their choice, will execute a written estoppel certificate, subject to approval as to form by the City Attorney, identifying any obligations of Owner 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, Owner is in compliance with its duties and obligations under this Agreement, except as expressly identified. The City is entitled to recover all of the City's out-of-pocket expense for gathering the information required to sign the estoppcl certificate, including professional and consulting fees and related expenses, and such expense shall be paid prior to the City releasing the estoppel certificate.

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ARTICLE XIII. ADDITIONAL PROVISIONS

Section 13.01 Recitals. The recitals contained in this Agreement: (a) are legislative findings by the City Council; (b) are true and correct as of the Effective Date; ( c) contribute to the basis upon which the Parties negotiated and entered into this Agreement; and ( d) reflect the final intent of the Parties as stated therein. 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

Section 13.02 Notices. All notices required or contemplated by this Agreement (or otherwise given in connection with this Agreement) (a "Notice") shall be in writing, shall be signed by or on behalf of the PBlty giving the Notice, and shall be effective as follows: (a) on or after the 5lh 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 by delivery in person or by regular mail. Notices given pursuant to this section shall be addressed as follows:

To the City:

With a copy to:

City of Justin Attn: Mayor 415 North College Ave. Justin, Texas 76247 e-mail: gscott@cityofjustin.com

City of Justin Attn: City Manager 415 North College Ave. Justin, Texas 76247 e-mail: astathatos@cityofjustin.com

Robert L. Dillard III Nichols, Jackson, Dillard, Hager & Smith, LLP 1800Ross Tower 500 N. Akard St. Dallas, Texas 75201 e-mail: rdillard@njdhs.com

To the Owner:

With a copy to:

Bloomfield Homes, L.P. 1050 E. Hwy 114, Ste. 210 Southlake, Texas 76092 Attention: Don Dykstra e-mail: don@bloomfieldhomes.net

and

Justin Timberbrook, LLC 1050 E. Hwy 114, Ste. 210 Southlake, Texas 76092 Attention: Don Dykstra e-mail: don@bloomfieldhomes.net

Douglas Properties, Inc. 2309Ave.K Suite 100 Plano, TX 75074 e-mail: jim.douglasproperties@gmaiLcom

and

Ross Martin Winstead PC 500 Winstead Building 2728 N. Harwood St Dallas, Texas 75201 e-mail: rmartin@winstead.com

Section 13.03 EFFECTIVE DATE. THIS AGREEMENT SHALL CONSTITUTE A "PERMIT" WITHIN THE MEANING OF CHAPTER245, TEXAS LOCAL GOVERNMENT CODE. OWNER WAIVES ALL CLAIMS THAT ANY OBLIGATION INCURRED BY OWNER SET OUT IN THIS AGREEMENT CONSTITUTES A "TAKING", AN ILLEGAL EXACTION, OR INVERSE CONDEMNATION OF ALL OR ANY PORTION OF THE PROPERTY. EXCEPT AS EXPRESSLY SET FORTI! IN THIS AGREEMENT, OWNER DOES NOT, BY ENTERING INTO THIS AGREEMENT, WAIVE (AND OWNER EXPRESSLY RESERVES) ANY RIGHTS AND CLAIMS THAT OWNER MAY HAVE ARISING FROM ANY ACTION BY THE CITY AFTER THE EFFECTIVE DATE. THE CITY SHALL NOT BE REQUIRED TO DETERMINE ROUGH PROPORTIONALITY OR NECESSITY AS PROVIDED FOR IN SECTION 212.904 OF THE TEXAS LOCAL GOVERNMENT CODE FOR ANY DEDICATIONS OR IMPROVEMENTS REQUIRED UNDER THIS AGREEMENT, AS AMENDED, OR OTHERWISE PROPOSED BY OWNER.

Section 13.04 Authority and Enforceability. The City represents and warrants that this Agreement has been approved by the City Council in accordance with all applicable public notice requirements (mcluding, 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. Owner represents and warrants that this Agreement has been approved by appropriate action of Owner, and that the individuals executing this Agreement on behalf of Owner have been duly authoriied to do so. Each Party acknowledges and agrees that this Agreement is binding upon such Party and enforceable against such Party in accordance with its terms and conditions and that the performance by the Parties under this Agreement is authorized by Section 212.171 et seq. of the Texas Local Government Code.

Section 13.05 Entire Agreement: Severabilitv: 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. Except as provided in Section 2.0l(b), this Agreement shall not be modified or amended except in writing signed by the City, Owner, and the owner of the portion of the Property affected by the amendment. 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. If it is determined by a judgment of a trial court with jurisdiction over the matter that any of the Property is not located within the City's ETJ, this Agreement shall remain in full force and effect with respect to the remainder of the Property unless Owner elects to terminate the Agreement pursuant to Article VIII. ·

Section 13.06 APPiicable 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 and exclusive jurisdiction for any action to enforce or construe this Agreement shall be Denton County.

Section 13.07 No 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.

Section 13.08 No Third Partv Beneficiaries. Except as otherwise provided in this section, this Agreement only inures to the benefit o:t; and may only be enforced by, the Parties. An End-Buyer shall be considered a third-party beneficiary of this Agreement, but only for the limited pmposes for which an End-Buyer is bound by this Agreement. No other person or entity shall have any right, title, or interest under this Agreement or otherwise be deemed to be a third­party beneficiary of this Agreement.

Section 13.09 Force Majeure. Each Party shall use good faith, due diligence and reasonable care in the performance of its respective obligations under this Agreement, and time shall be of the essence in such performance; however, in the event a Party is unable, due to force majeure, to perform its obligations under this Agreement, then the obligations affected by the

force majeure shall be temporarily suspended. Within three business days after the occurrence of a force majeure, the Party claiming the right to temporarily suspend its perfoanance shall give Notice to all the Paities, including a detailed explanation of the force majeure and a description of the action that will be taken to remedy the force majeure and resume full performance at the earliest possible time. The term "force majeure" shall include events or circumstances that are not within the reasonable control of the Party whose performance is suspended and that could not have been avoided by such Party with the exercise of good faith, due diligence and reasonable care. Any suspension of obligation(s) because of any force majeure shall terminate automatically sixty (60) days following the provision of the Notice described by this section, unless otherwise separately agreed by the affected Party(ies).

Section 13 .I 0 Effective Date. This Agreement will become effective on the later to occur of: (a) approval and authorization of this Agreement by majority vote of a quorum of the Justin City Council following the fulfillment of all notice and public meeting requirements of Texas law; and (b) execution by OWner or Owner's duly authorized representative. If this Agreement is not signed by both Parties by July 31, 2016 it will be of no force and effect unless reapproved by the City Council.

Section 13.11 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 instrument

Section 13.12 Further Documents. Each Party shall, upon request of the other Party, execute and deliver such further documents and perform such further acts as may reasonably be requested to effectuate the terms of this Agreement and achieve the intent of the Paities.

Section 13.13 Exhibits. The following Exhibits are attached to this Agreement and are incorporated herein for all purposes:

Exhibit A ExhibitB ExhibitC ExhibitD ExhibitE ExhibitF ExhibitG

Metes and Bounds Description.of Property Site Plan/Map of Property Subdivision Regulations Development Standards Street Standards Water and Sewer Standards Miscellaneous Conditions

Executed by the City and Owner to be effective on the Effective Date.

CITY OF JUSTIN

ATTEST:

APPROVED AS TO FORM:

~j;2~ STATE OF TEXAS §

§ COUNTY OF DENTON §

This instrument was acknowledged before me on the /e; 16 day of f'l'fl-1 (_ . , 2016, by Greg Scott, Mayor of the City of Justin, Texas, on behalf of said city.

OWNER:

BWOMFIELD HOMES LP., a Texas limited partnership

By: Bloomfield Properties, Inc., a Texas corporation, its General Partner

By:

JUSTIN TIMBERBROOK, LLC, a Texas limited liability comp y

By:

STATE OF~ ~

COUNTY OF § ~ This instrument was acknowledged before me on the _k_ day of 2016, by

Donald J. Dykstra, President of Bloomfield Properties, Inc., a Texas co ration, as General Partner of Bloomfield Homes, L.P ., a Texas limited partnership, on be on behalf of said limited partnership.

'•,, BRENDA KAVE 8ERRV ~\ Notary Public. State of lexos

My Commission ExpiEes February 11, 2019

STATEOF~ ,, - .

COUNTY OF_~----§ § §

This instrument was acknowledged before me on the __fr__ day of..:·4~~=-~' Donald J. Dykstra, Manager of Justin Timberbrook, LLC, a Texas limited behalf on behalf of said limited liability company.

····:'"'~;: .. ·-~ •. l·.··. ,:(··_:: ~= .... ~~·~i~.:,.i

•'IEM~A KAYE BERRY =:.!'.· ;'11:t1;r;. :.:>1u1e of Texos ·.iv C-vrnm1ssion Expires

February 11. 2019

EXHIBITA METES AND BOUNDS DESCiuPTION OF PROPERTY

EXHIBIT "A" METES AND BOUNDS DESCRIPTION OF THE PROPERTY

All that certain lot, tract, or parcel ofland, situated in a portion of the M.E.P. & P.R.R. Survey, Abstract No. 1477, City of Justin, Denton County, Texas, being part of that certain remainder of called 44.438 acre tract described in a deed from Howard Young to Gary L. Place and wife, Darla K. Place on May 14, 1996 and recorded in Document No. 96-R0034979 of the Deed Records of Denton County, Texas (DRDCT), and being more completely described as follows, to-wit:

BEGINNING at a 112" iron rod found for an ell comer of said 44.438 acre tract and being the Northwest comer of a called 15.395 acre tract described in a deed to P & C Machine Works, Inc. recorded in Document No. 96-R0034981 (DRDCT);

THENCE South 10 deg. 56 min. 44 sec. East along the most southerly East line of said 44.438 acre tract and the West line of said 15.395 acre tract, a distance of 497.81 feet to a 112" iron rod found for the most southerly Southeast comer of said 44.438 acre tract, the Southwest corner of said 15.395 acre tract, being in the recognized South line of said M.E.P. & P.R.R. Survey and the recognized North line of the Wilson Survey, Abstract No. 1358;

THENCE North 88 deg. 43 min. 58 sec. West along the South line of said 44.438 acre tract, and the North and South lines of said Surveys, a distance of 670.17 feet to a 5/8" iron rod found;

THENCE North 00 deg. 07 min. 01 sec. East departing said North and South Survey lines and continue along the South line of said 44.438 acre tract, a distance of 72.33 feet to a 5/8" iron rod found;

THENCE North 88 deg. 51 min. 24 sec. West along said South line, a distance of 107.69 feet to the Southeast corner of a called 1.904 acre tract described in a deed to Sandra Copp recorded in Volume 4070, Page 1426 (DRDCT);

THENCE North 00 deg. 29 min. 49 sec. East departing said South line and continue along the East line of said 1.904 acre tract, a distance of 75.15 feet to a 112" iron rod found for the Northeast corner of same;

THENCE North 89 deg. 00 min. 55 sec. West along the North line of said 1.904 acre tract, a · distance of 699.50 feet to the Northwest comer of same, and being in the East line of a called 7.910 acre tract described in a deed to David and Heather Stone recorded in Document No. 2013-92970 (DRDCT), and being in the West line of said 44.438 acre tract;

THENCE North 00 deg. 31 min. 26 sec. East along the East line of said 7.910 acre tract and the West line of said 44.438 acre tract, a distance of 354.30 feet;

THENCE South 88 deg. 15 min. 18 sec. East departing said East and West lines, a distance of 1379.16 feet to the POINT OF BEGINNING, containing 593,353 square feet or 13.622 acres of land, more or less.

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All that certain lot, tract, or parcel ofland, situated in a portion of the N. S. Hazelton Survey, Abstract No. 546, the H. McDonald Survey, Abstract No. 879, the W.W. Young Survey, Abstract No. 1444, the E. Young Survey, Abstract No. 1452, the ME. P. & P.R. R. Survey, Abstract No. 1477, the R. W. Ten-ell Survey, Abstract No. 1650, Denton County, Texas, being part of that certain remainder of called 44.438 acre tract described in a deed from Howard Young to Gary L. Place and wife, Darla K. Place on May 14, 1996 and recorded in Document No. 96- R0034979 of the Deed Records of Denton County, Texas (DRDcn, all of that certain called 35.0535 acre tract described in a deed from Republic Bank Dallas, N.A., Trustee to Gary Place on July 13, 1984 and recorded in Volume 1443, Page 975 (DRDCn, all of that certain tract ofland described in a deed from Myrtle Pennington to Gary L. Place on January 30, 1981 and recorded in Volume 1058, Page 806 (DRDCn, all of that certain called 11.25 acre tract described in a deed from J. W. Sullivan and wife, Marie A. Sullivan to D. S. Donald on January 15, 1929 and recorded in Volume 224, Page 210 (DRDcn, and being more completely described as follows, to-wit:

BEGINNING at a 1/2" capped iron rod previously set stamped "GOODWIN & MARSHALL" in the South line of said 44.438 acre tract, the North line of a called 15.395 acre tract described in a deed to P & C Machine Works, Inc. recorded in Document No. 96-R0034981 (DRDcn, and in the recognized West right-of-way line of Fann to Market Highway No. 156 (variable right-of- way width), from which a 1/2" iron rod found for the Southeast comer of said 44.438 acre tract (by deed calls) and the Northeast comer of said 15.395 acre tract (by deed calls) bears South 88 deg. 15 min. 18 sec. East - 5.15 feet;

THENCE North 88 deg. 15 min. 18 sec. West along said North and South lines, at 1458.56 feet pass a 1/2" iron rod found for an ell comer of said 44.438 acre tract and the Northwest comer of said 15.395 acre tract and continue a total distance of2837.71 feet to the East line of a called 7.910 acre tract described in a deed to David and Heather Stone recorded in Document No. 2013- 92970 (DRDcn and being in the West line of said 44.438 acre tract;

THENCE North 00 deg. 31 min. 26 sec. East along the East line of said 7.910 acre tract and the West line of said 44.438 acre tract, at 123.76 feet pass a 1/2" iron rod found in the East line of Ridgeview Estates recorded in Cabinet N. Page 398 of the Plat Records of Denton County, Texas (PRDCT) and continue a total distance of 440.94 feet to a 60D nail found for the Northwest comer of said 44.438 acre tract, the Northeast comer of said Ridgeview Estates, being in the South line of said tract of land to Gary L. Place recorded in Volume 1058, Page 806 (DRDCn, being in the recognized South line of said N. S. Hazelton Survey, and the recognized North line of said M.E.P. & P.R.R. Survey;

THENCE North 88 deg. 13 min. 32 sec. West along the North line of said Ridgeview Estates, the South line of said Gary L. Place tract, and the recognized North and South lines of said Surveys, a distance of 1555.09 feet to a 3/8" iron rod found for the NOlihwest comer of said Ridgeview Estates, the Southwest comer of said Gary L. Place tract, being in the East line of said 11.25 acre

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tract, being the recognized Southwest comer of said N. S. Hazelton Survey and the East line of said R. W. Terell Survey;

THENCE South 00 deg. 24 min. 46 sec. West along the East line of said 11.25 acre tract, the West line of said Ridgeview Estates, and the recognized East line of said R. W. Terrell Survey, a distance of 965.92 feet to a 112" capped iron rod found stamped ''3638" for the Southeast comer of said 11.25 acre tract and an ell comer of said Ridgeview Estates;

THENCE North 89 deg. 31 min. 56 sec. West departing said Survey line and continue along the South line of said 11.25 acre tract, the most westerly North line of said Ridgeview Estates, a distance of 394.61 feet to a fence comer for the Southwest comer of said 11.25 acre tract, the most westerly Northwest comer of said Ridgeview Estates, and being in the East line of a called 77 .19 acre tract described in a deed to Steward Holdings, LP recorded in Document No. 2010-78659 (DRDCT);

THENCE North 00 deg. 08 min. 56 sec. East along the West line of said 11.25 acre tract and the East line of said 77.19 acre tract, a distance of 1223.67 feet to a 112" capped iron rod previously set stamped "GOODWIN & MARSHALL" for the Northwest comer of said 11.25 acre tract, the Northeast comer of said 77.19 acre tract, being inthe South line of said 35.0535 acre tract, the recognized South line of said W. W. Young Survey, and the recognized North line of said H. McDonald Survey;

THENCE North 89 deg. 53 min. 56 sec. West along the South line of said 35.0535 acre tract, the North line of said 77.19 acre tract, the South line of said W. W. Young Survey, the North line of said H. McDonald Survey, and generally with a fence, at 2045.17 feet pass a fence PI 3.9 feet North ofline, at 2219.46 feet pass a 112' ·capped iron rod previously set stamped "GOODWIN & MARSHALL" for reference, and continue a total distance of 2369 .46 feet to a point in the centerline of Oliver Creek, from which a 10" cedar fence comer found forthe recognized Southwest comer of said W. W. Young Survey bears North 89 deg. 53 min. 56 sec. West -706.32 feet;

THENCE in a northwesterly direction along the centerline of said Oliver Creek the following forty-seven ( 4 7) courses;

North 51 deg. 15 min. 16 sec. East, a distance of 151.43 feet to a point;

North 52 deg. 27 min. 07 sec. East, a distance of 196.96 feet to a point;

North 40 deg. 16min. 03 sec. East, a distance of 154.27feetto a point;

North 42 deg. 51 min. 10 sec. East, a distance of 100.33 feet to a point;

North 77 deg. 17 min. 59 sec. East, a distance of94.06 feet to a point;

South 73 deg. 35 min. 56 sec. East, a distance of49.93 feet to a point;

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North 87 deg. 18 min. 55 sec. East, a distance of 72.64 feet to a point;

North 69 deg. 58 min. 14 sec. East, a distance of 170.43 feet to a point;

North 61 deg. 45 min. _38 sec. East, a distance of 342.10 feet to a point;

North 45 deg. 09 min. 40 sec. East, a distance of 135.87 feet to a point;

North 48 deg. 22 min. 12 sec. East, a distance of95.16 feet to a point;

South 88 deg. 00 min. 22 sec. East, a distance of 33.23 feet to a point;

South 51 deg. 06 min. 32 sec. East, a distance of 113.07 feet to a point;

South 45 deg. 09 min. 04 sec. East, a distance of 149.75 feet to a point;

South 64 deg. 04 min. 16 sec. East, a distance of 170.34 feet to a point;

South 82 deg. 58 min. 49 sec. East, a distance of 191.84 feet to a point;

North 61 deg. 17 min. 34 sec. East, a distance of 94.24 feet to a point;

North 20 deg. 00 min. 00 sec. East, a distance of 105.84 feet to a point;

North 11 deg. 44 min. 28 sec. East, a distance of 97.33 feet to a point;

North 29 deg. 09 min. 43 sec. East, a distance of 66.14 feet to a point;

North 72 deg. 48 min. 46 sec. East, a distance of 65.89 feet to a point;

North 84 deg. 08 min. 17 sec. East, a distance of 60.16 feet to a point;

South 60 deg. 01 min. 59 sec. East, a distance of 103.62 feet to a point;

South 40 deg. 07 min. 11 sec. East, a distance of 256.88 feet to a point;

South 51 deg. 54 min. 24 sec. East, a distance of 138.91 feet to a point;

South 82 deg. 48 min. 45 sec. East, a distance of 122.06 feet to a point;

North 70 deg. 21 min. 18 sec. East, a distance of 136.98 feet to a point;

North 57 deg. 07 min. 49 sec. East, a distance of 128.52 feet to a point;

South 88 deg. 18min. 12 sec. East, a distance of215.06 feet to a point;

4IPage

North 87 deg. 33 min. 35 sec. East, a distance of 110.30 feet to a point;

Nmth 67 deg. 52 min. 06 sec. East, a distance of 207.51 feet to a point;

North 08 deg. 48 min. 05 sec. East, a distance of 5.83 feet to a point;

North 62 deg. 35 min. 14 sec. East, a distance of 119.17 feet to a point;

North 54 deg. 18 min. 14 sec. East, a distance of 124.51 feet to a point;

North 62 deg. 18 min. 21 sec. East, a distance of 127.99 feet to a point;

North 14 deg. 24 min. 26 sec. East, a distance of 46.68 feet to a point;

North 53 deg. 29 min. 27 sec. East, a distance of 462.51 feet to a point;

North 45 deg. 52 min. 08 sec. East, a distance of 224.12 feet to a point;

North 26 deg. 02 min. 20 sec. East, a distance of 196.97 feet to a point;

North 41 deg. 40 min. 15 sec. East, a distance of 164.67 feet to a point;

North 59 deg. 45 min. 26 sec. East, a distance of 196.15 feet to a point;

Nmth 89 deg. 38 min. 11 sec. East, a distance of 72.18 feet to a point;

South 66 deg. 12 min. 45 sec. East, a distance of 104.63 feet to a point;

South 52 deg. 47 min. 32 sec. East, a distance of 100.44 feet to a point;

South 80 deg. 30 min. 56 sec. East, a distance of 154.09 feet to a point;

South 62 deg. 10 min. 20 sec. East, a distance of 281.52 feet to a point;

South 43 deg. 45 min. 32 sec. East, a distance of 57.60 feet to a point;

THENCE North 88 deg. 11min.41 sec. East departing said centerline, a distance of 139.80feet to a 112" iron rod found for the Southwest comer of a called 20.000 acre tract described in a deed to Brad and Jessica Judge recorded in Document No. 2006-113979 DRDCT, the Southeast corner ofa called 33.616 acre tract described in a deed to the Lobsinger Family Trust recorded in Document No. 2008-93313 DRDCT, and being in the North line of said Gary L. Place tract recorded in Volume 1058,Page 806 (DRDCT);

THENCE North 88 deg. 38 min. 53 sec. East along the North line of said Gary L. Place tract and the South line of said 20.000 acre tract, a distance of 378.60 feet to a 112" capped iron rod

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previously set stamped "GOODWIN & MARSHALL" at an old fence intersection forthe Northwest corner of a called 38.494 acre tract described in a deed to Gary Lyn Place recorded in Volume 4889, Page 892 (DRDCT), from which a l/2" iron rod found forthe Southeast corner of said 20.000 acre tract bears North 88 deg. 38 min. 53 sec. East -35.73 feet;

THENCE in a southeasterly direction along the No th line of said Gary L. Place tract, the West and South lines of said 38.494 acre tract and generally with a fence the following nine (9) courses;

South 01 deg. 33 min. 02 sec. West, a distance of78.50 feetto a 30" Hackberry;

South 54 deg. 40 min. 59 sec. East, a distance of 144.58 feet to a 24" Elm;

South 01 deg. 44 min. 42 sec. West, a distance of 367.88 feet to a 112" iron rod previously set stamped "GOODWIN & MARSHALL;

South 19 deg. 25 min. 18 sec. East, a distance of 480.95 feet to a 112" iron rod previously set stamped "GOODWIN & MARSHALL;

South 58 deg. 15 min. 18 sec. East, a distance of 147.50 feet to a 112" iron rod previously set stamped ''GOODWIN & MARSHALL;

South 68 deg. 25 min. 18 sec. East, a distance of 194.30 feet to a 112" iron rod previously set stamped "GOODWIN & MARSHALL;

South 66 deg. 15 min. 18 sec. East, a distance of 194.00 feet to a 112" iron rod previously set stamped "GOODWIN & MARSHALL;

South 73 deg. 00 min. 18 sec. East, a distance of 184.60 feet to a 112" iron rod previously set stamped "GOODWIN & MARSHALL;

South 83 deg. 45 min. 18 sec. East, a distance of2 l l.20 feet to a 112" iron rod previously set stamped "GOODWIN & MARSHALL forthe Northwest corner of a called 1.058 acre tract described in a deed to Gary L. Place recorded in Volume 1066, Page 226 (DRDCT);

THENCE in a southeasterly direction along the North line of said Gary 1. Place tract and the West and South line of said 1.058 acre tract the following six (6) courses;

South 43 deg. 14min. 42 sec. West, a distance of26.50 feet to a 112" iron rod previously setstamped "GOODWIN &MARSHALL;

South 11 deg. 45 min. 18 sec. East, a distance of29.60 feet to a 112" iron rod previously set stamped ''GOODWIN & MARSHALL;

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South 62 deg. 59 min. 18 sec. East, a distance of 195.20 feet to a 1/2" iron rod previously set stamped ''GOODWIN & MARSHALL;

South 35 deg. 37 min. 18 sec. East, a distance of 116.90 feet to a 1/2" iron rod previously set stamped ''GOODWIN & MARSHALL;

South 31 deg. 59 min. 42 sec. West, a distance of 79.40 feet to a 1/2" iron rod previously set stamped "GOODWIN & MARSHALL;

South 42 deg. 46 min. 18 sec. East, a distance of 105.55 feet to a 1/2" iron rod previously set stamped "GOODWIN & MARSHALL for the South comer of said 1.058 acre tract, the Northeast comer of said Gary L. Place tract, and being in the recognized West right-of-way line of said Farm to Market Highway No. 156;

THENCE South 05 <leg. 15 min. l 7sec. West along said West right-of-way line, a distance of 645.70 feet to the POINT OF BEGINNING, containing 8,937,708 square feet or 205.182 acres of land, more or less.

7JPage

All that certain lot, tract, or parcel ofland, situated in a portion of the M. Garnett Survey, Abstract No. 439, the H. McDonald Survey, Abstract No. 879, and the W. M. Reed Survey, Abstract No. 1071, Denton County, Texas, being part of that certain called 411.268 acre tract described in a deed from Steward Holdings, LP, Carter Real Estate, LP, and Ruth Ann Carter Trustee, under the Marvin & Ruth Carter Living Trust dated August 11, 2000 to Justin Timberbrook, LLC on May 12, 2016 and recorded in Document No. 2016-55837 of the Deed Records of Denton County, Texas (DRDCT), and being more completely described as follows, to-wit:

BEGINNING at a 5/8" iron rod found for the Southwest comer of said 411.268 acre tract, the Southeast comer of a called 131.6291 acre tract described in a deed to Macy E. Smith, recorded in Volume 3038, Page 702 (DRDcn, and in the North right-of-way line ofFarm-to-Market Highway No. 407 (90' public right-of-way);

THENCE North 00 deg. 25 min. 35 sec. West departing said North right-of-way line and continue along the East line of said 131.6291 acre tract and the West line ofsaid411.268 acre tract, a distance of 1412.84 feet;

THENCE North 82 deg. 33 min. 17 sec. East departing said East and West lines, a distance of 654.90 feet to a Point of Curvature of a non-tangent circular curve to the right, having a radius of 2640.00 feet, a central angle of 9 deg. 53 min. 45 sec., and being subtended by a chord which bears North 09 deg. 02 min. 00 sec. West - 455.41 feet;

THENCE in a northerly direction along said curve to the right, a distance of 455.97 feet;

THENCE North 00 deg. 25 min. 43 sec. West, a distance of 2736.00 feet to a Point of Curvature of a non-tangent circular curve to the right, having a radius of 2640.00 feet, a central angle of 26 deg. 01 min. 14 sec., and being subtended by a chord which bears North 13 deg. 59 min. 29 sec. East - 1188.66 feet;

THENCE in a northeasterly direction along said curve to the right, a distance of 1198.94 feet to the North line of said 411.268 acre tract;

THENCE North 74 deg. 21 min. 14 sec. East along said North line, a distance of 88.17 feet;

THENCE North 71 deg. 02 min. 07 sec. East along said North line, a distance of 83.84 feet;

THENCE North 75 deg. 52 min. 49 sec. East along said North line, a distance of225.33 feet;

THENCE North 80 deg. 02 min. 08 sec. East along said North line, at 324.15 feet pass a Bois D' Arc fence comer and continue a total distance of 347.22 feet to the recognized East line of said W. M. Reed Survey and the West line of the W.W. Young Survey, Abstract No. 1444;

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TIIENCE South 00 deg. 04 min. 18 sec. East along said North line, the recognized East and West lines of said Surveys, a distance of 168.49 feet to a 10" cedar fence corner for Southwest corner of a called 1.1732 acre tract described in a deed to Gary Place recorded in Volume 1443, Page 975 (DRDcn, said point being the recognized Southwest corner of said W. W. Young Survey and the most northerly Northwest corner of said M. Garnett Survey;

TIIENCE South 89 deg. 53 min. 56 sec. East along the North line of said 411.268 acre tract, the South line of said 1.1732 acre tract, a southwesterly line of a called 207 .569 acre tract described in a deed to Bloomfield Homes, LP recorded in Document No. 2016-64678 (DRDCn, and the recognized South line of said W. W. Young Survey, The North line of said M. Garnett Survey, and the North line of said H. McDonald Survey, a distance of3075.78 feet to the Northeast corner of said 411.268 acre tract and the Northwest corner of a called 11.234 acre tract described in a deed to Bloomfield Homes, LP recorded in Document No. 2016-64656 (DRDCT);

TIIENCE South 00 deg. 08 min. 56 sec. East departing said Survey lines and continue along the East line of said 411.268 acre tract and the West line of said 11.234 acre tract, a distance of 1223.67 feet to a fence corner for the Southwest corner of said 11.234 acre tract and being the most westerly Northwest corner of Ridgeview Estates recorded in Cabinet N, Page 398 of the Plat Records of Denton County, Texas (PRDCT);

TIIENCE South 05 deg. 15 min: 18 sec. West along the East line of said 411.268 acre tract and the West line of said Ridgeview Estates, a distance of 21. 76 feet to a Bois D' Arc fence corner for the most northerly Southeast comer of said 411.268 acre tract and the Northeast corner of a called 82.044 acre tract described in a deed to Peggy lhnfeldt recorded in Document No. 2004-116851 (DRDCn;

THENCE North 89 deg. 54min. 49 sec. West along a South line of said 411.268 acre tract and the North line of said 82.044 acre tract, a distance of 1415.75 feet to a 112" iron pipe found for the NO lihwest comer of said 82.044 acre tract and an ell comer of said 411.268 acre tract;

THENCE South 00 deg. 18min. 00 sec. East along the West line of said 82.044acretractthe the East line of said 411.268 acre tract, a distance of2692.74 feet to a bolt found forthe Southwest comer of said 82.044 acre tract and an ell corner of said 411.268 acre tract;

THENCE South 89deg. 28 min. 31 sec. West along the South line of said 411.268 acre tract, a distance of 1286.69 feet to an ell comer of same;

TIIENCE South 00 deg. 32 min. 43 sec. East along the East line of said 411.268 acre tract, a distance of 1860.56 feet to the most southerly Southeast corner of said 411.268 acre tract and being in the North right-of-way line of said Farm-to-Market Highway No. 407, from which a lOOD nail found bears South 00 deg. 32 min. 43 sec. East -0.79 feet;

TIIENCE South 89 deg. 26 min. 19sec. West along the South line of said 411.268 acre tract and said North right-of-way line, a distance of 962.81 feet to the Southeast corner of a called 4.05 acre tract described in a deed to Pete Allen Mitchell, et ux recorded in Volume 1226, Page 932 (DRDCT);

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TIIENCE North 00 deg. 32 min. 43 sec. West departing said North right-of-way line and continue along the East line of said 4.05 acre tract and a West line of said 411.268 acre tract, a distance of 588.43 feet to the Northeast comer of said 4.05 acre tract;

THENCE South 89 deg. 20 min. 19 sec. West along the North line of said 4.05 acre tract, the North line of a called 3.0 acre tract described in a deed to William D. Mitchell recorded in Volume 2292, Page 269 (DRDCT), and a South line of said 411.268 acre tract, a distance of 522.50 feet to a 5/8" iron rod found "bent" for the Northwest comer of said 3.0 acre tract;

THENCE South 00 deg. 32 min. 43 sec. East along the West line of said 3.0 acre tract, an East line of aid 411.268 acre tract, a distance of 588.16 feet to the Southwest comer of said 3.0 acre tract, said point being in the North right-of-way fine of said Farm-to-Market Highway No. 407;

TIIENCE South 89 deg. 20 min. 19 sec. West along the South line of said 411.268 acre tract and said North right-of-way line, a distance of 480.36 feet to the POINT OF BEGINNING, containing 15,373,196 square feet or 352.920 acres ofland, more or less.

Bearings are referenced to Texas State Plane Coordinate System, North Central Zone (4202), North American Datum of 1983 as derived from GPS observation.

1DIPage

EXHIBITB SITE PLAN/MAP

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EXIJIBITD DEVELOPMENT CO~"DITIONS

CONDITIONS FOR DEVELOPMENT AGREEMENT

I. GENERAL CONDITIONS· Lot Size rMinimumJ

Lot Area<sa. ft.) 7,000

Lot Width (feet) 60

Lot width.of corner Lots (feet) 65

Lot Depth (feet) 100

Lot Denth of Double FrontLots·(feet) 110

Dwelling ·Regulations

<Minimum Square Footaite)

All Homes will be a minimum ·of 1,600 with no morethan25% lesstl)aJ! 2,000

Yard RP.1111irements

Front Yard minimwn (feet) 20

Side Yard minimwn (feet) 5

Side Yard ofComer .Lots minimum (feet) 10

Side Yard of Corner Lots <feet) on kev lots 20

Rear Yard minimum (feet) 15

Rear Yard Double Front Lots minimum (feet) 20

Lot Coverage maximum 50%

House Requirements

Main Structure maximum Hei2ht (feet) 40

Accessorv Structure Hei.,ht maximum (feet) 14

Masonrv Percenta!!e minimum 70"/o

Roof Pitch maximum 6112

11. SPECIAL CONDITIONS:

1. Three-tab roofing shall not be permitted. 2. :No alleys shall be required and garage doors may face the street. J. Developer shall install a 6-:fuot !llasDi)ry wall ora 6"foot high decorative iron fence·with living

screen where lots back to a roadway with a 4•foot sidewalk back .of curb. Lots which baCk onto parkland shall proyide a 4-foot high decorative iron fence of uniform design. Lots which back onto park land shall provide a decorative ircin fence c;lfUQiform design to be approved by the Owner and be installed by the homebuilder.

4. The Development Plan attached as E)iliibit "C" shajl serve as the Preliminary Plat 5. Hike & Bike Trails shall,be inStalled in the Flood Plain and Fl09d Way., 6. Homes shall be·set back 150 feet from existing well beads.

7. Al))' ~ in -riglit-of-ways, easements, house pads; I 0 feet :from the house pad, future ri:>ads.shlill not be tnitigated. Anyqees planted:on lots, niei;lian$, 'la!!dscape buffers, and private or public open space should countformitigated trees;

8. The only City Fees that will be paid with thi~ prQjeetwill be water fees,. certificate of occupancy fees and building fees.

9. Water s:erVices shlill be allowed to tap up to a f2-inch watedjne when applicable. 1 O. Bull head wai:er taps shall be anowed. 1 !. Roff over curbs will be allowed. l2. All lot purchasers.wili be _required ey c1¢ed to be members i>f a fomeQwners' associatiqn,

EXHIBITE STIIBET STANDARDS

The Subdivision Regulations shall apply to the dev~lopment .of the Property, except as modified as follows:

Arierj.al road No. 1 coming off FM 407 (the '!FM 407 ArterlalRoad") shallbe two interior lanes and a dedicated turn lane with 120 feet of dedicated right-of-way for futi.µ-e expansion to the exterior of the road. All :paving or other imptov~ents for the FM 40'7 Arterial Road shall be finaneed by Assessments or. the proceeds of PID Bonds to the eictent· allowed by law. the additional right-of-way necessary for the FM 407 Artei;ial Road shall also be financed by PID Assessments or the proceeds of PID Bonds to the ertent allowed by law.

~road No. 2 coming off FM 156 (the "FM 156 Arterial Road") shall be two interior.lanes at)d a dedicated turn lane with 120 feet of dedicated tight-of-way for future .expansion to the exterior of the road. All paving or other improvements (or the FM 156 Arterial Road shall be financed by Assessments or the pto~eds of PID Bon4s to :the extent allowed by law. The additloruil .right-of-way necessary for the FM 156 Arterial Road shall be finaneed by PID Assessments or the proceeds of PIO Bonds to the extent allowed by law.

In constructing the roads subject to the Agreement, the Owner shall comply with any applicable standards of the City, the County, the State of Texas, and the United States of America (mcluding any agency thereof) with respect to safety requirements and compliance with the Americans with Disabilities .Act in force at theiiroe of construction .of such ·road.

Street sections for each class of street are sbown .in the following Exhibits. Reinforcing, steel used in street paving sqall not be smaller tban.#3 bars.

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NOTE:St ALL CONCRETE PAVEMENT ro BE 3, 600 PSI MIN.

REINFORCEMENT SHALL BE NO. 3 BARS If 19' O.C.B.W.

LIME AFPl.!CA TION RA TE AS OETERMlr:ED BY LiMt ·s TEST B;Y GEOTECH/t/l.CAI. EN'

40' 120'R.o.w. ~ LANOSCIJP£0 .

MEDIAN 12' . 28' oii! 28' """l...t I?' ... ""',_, 12',._ - "'" ..,. I I ~W I -·-·---~~

'! rnE 6' Hl«E/8/KE Tl/AIL llCPl.ACES TIE 4 '.S«IVALK

iF TRAIL IS LOCATED ADJACENr TC OR WITHIN TIE R.O. w,

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8' Llm6 Slab lilied SubgradfJ

120' R.OW. CR.OSS-SECT!QN NO. 1

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120:' R.o.w.

40' LAM>SCAPED

MEDIAN

12' TURN LANE:'

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12' 28'

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Future Pavomenl

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120' R.OW. CROSS-SECTION NO~ 2

TIMSERBROOK STANDARD 120' R.O. W. -ARTERIAL STREET DitrAILS

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B'~o" HIKE/BIKE

TRAIL.

• THE ·6' HJKE"811<E TRAIL REPl.ACES TIE 4 ' SIDEWALK

IF TRAR. IS LocA TED ADJACENT TO .. OR WITHIN '[fER.O.W.

fl·4·'-o:ti SIDEWALK

8 • Lime SirJbN/zed SIJbgrade

N(JTES1 ALL CONCRETf: PAVE:MENT TO·BE: J, 600 PSI MIN.

RE:/NFORCEM£NT SHALL SE: NO. 3 BARS !!! IS' 0. C. 8. W.

UE APPLJ(;A t/oN RATE: A$ OE:TE:RMINE:D SY LIME SE:RIE:S TC5T BY GEOTE:CHNICAL E:Nq/N££R.

PAVE:MENT sE.tTION,SHALL BE: .CoNsTRUCTE:t> W/Til A SLIP FQRM_ANQM<JNQUIHIC .Cf.111fl.

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36'-0' F-F 1~-~-----·

60' R.OW. CROSS-SECTION

NOTE I DEVE:LOPE'.R SHALL BE RESPONSIBLE FOR 25 I PAVEMENT SECTION

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TIMBERBROOK STANDARD 60' R.O. W. - COLLECTOR STREET DETAILS_

NIS

llOTE:S1 ALL CONCRr::TC PAVEMENT TO BE:;, 600 PSI MIN.

REWFoncE:MENT SHALL BE NO.:; BARs I! 18' o.c.B.W.

LIME APPL/CAT/ON. RA TE AS Of:TfJIM/NED BY UME SERIES TCST BY GEOTECHNJCAL ENGINEER.

PAVEMENT SECTION SHALL BE CONSTRUCTED WITH ., A SLIP FORM AND MONOLITHIC CURB.

4·'-.01

SIDEWALK

2.0Q;t

MOUNTABLE CURB

(MONO/./T/IC POI/RI

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6' 18'

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MOUNTABLE CURB OErAIL IV7S

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TYPICAL 50' ROW ROOFTOPPRQWN CROSS SECTION

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TIMBERBROOK STANDARD 50' R.O. W. - RESIDENTIAL STREET DETAILS

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sipEWALK

EXHIBITF WATER AND SEWERSTANDARDS

The Subdivision Regulations shall .apply to the ·development·of the Property, except as modified a5 follows:

Water line B along FM i56 shall be financed l>y Assessment/> or file pivceecls of PID Bonds to the extent it is sized to proVi.de service to the Property.

Water line A is internal to the·development.and shall be.financed by Assessments or the prooeedS of PID Bonds. ·

The twelve inch .on-site water lines may be tapped to serve the Property. Bull head services and taps are permitted within the Property.

Sewer 1ine C along FM 407 and. the 6" force ma.ill along FM. 156 shall be finaneed by Assessments or the proceeds-of PID Bonds to the extent allowed .by law.

The City will participate in any oversizing of sewer line B and the increase in capacity ofthe lift station uP and above what is needed to serve the Property through payment of oversizing costs at the time of construction of sewer line B. More analysis is needed by the engineer to determine the estimated costs of the City's proportionate share. ·

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NOTES1

THE FULL COST Of' THE 12• WATER LINE •A• 8 'B• IMPROVEMENTS SHALL BE REIMBURSED BY Tf£ TIMBERBROOK P .l.D,

THE COsT FOR THE <iFF-SITE.EAS£MENT.AC<llJIS\TION SHALL BE REIMBLflSED BY THE TIMBERBROOK P ,1.0.

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EXHIBITG MISCELLANEOUS CONDITIONS

.Must be set back at least lSO feet from existiiig well heads, .homes and p!!iks, and screened in compliance-with the City's ordinances.

ParkLand. Hike & Bike Trails Owner shall offer park land for dedication in the :final plat to the City in accordance with the City's :park dedication requirements .in effeet as of the Effective Date .and the O:wner's development plan, in the :O:wner' s sole discretion. Concrete bike and bike .trails shall 'be installed at a width of 6' in the flood plain and flpnd way. The concrete hike and bike trails shall. be paid for with :Assessme.o.ts on ;fhe Prqperty within the 'PIDs to the extent allowed by law.

Screening Owner shall, at Ow.o.er;s sole discretioh, install a 6-fo<it high.masonry screening wall or wrought iron fence with living screen where lotS back to a roadway, ·with a 4,foot sideWalk. Lots which back onto park land shall provide a decorative iron fence of uniform design.

Development Fees . Pay all .development fees including but not lirnite.d to: Zoning Fees, Plat Review Fees, Plan Review Fees, resideµtial construction .;fees and inspection fees. Pursuant to Section 4.03 ·Of this Agreement, impact fees will not be c)lm:ged within the Propeqy or any property subsequently subject to the terms of this Agreement

Municipal Site Dedicate 2,8 Acres for a municipal site and 1.4 Acres for .a water tower site. The land that ,is dedicated shall be agreed to by the City. The school site shall be negotiated with the. Northwest Independent School District.

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NOTES··· ~ I ! THE COSTS fOR TI-IE HIKE/BD<E TRAIL INOK;ATED ON : ) ~~Eetti\\)"~'b~~.~ ~E REIMBURSEo ev THE / I

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EXHIBIT"B" ANNEXATION SERVICE PLAN

In connection with the annexation of an approximately 571.72-acre tract of land, described in Exhibit "A", by the City of Justin, Denton County, Texas, the following service plan is adopted as required by Section 43.056 of the TEXAS LOCAL GOVERNMENT CODE.

The City of Justin will, to the extent it provides or authorizes such services itself or through contractual arrangements with other entities, provide the following services in the area upon the effective date of the annexation of the area:

(1) Police protection;

(2) Fire protection;

(3) Solid waste collection;

(4) Maintenance of water and wastewater facilities in the annexed area that are not within the service area of another water or wastewater utility;

(5) Maintenance and operation of roads and streets, including road and street lighting;

(6) Maintenance and operation of public parks and playgrounds

(7) Maintenance and operation of any other publicly owned facility, building or service; and

(8) Emergency medical services.

The City of Justin will also provide other services such as planning, zoning, code enforcement, subdivision regulation, court, construction codes and general administration, to the extent it now provides any such service, on the effective date of the annexation.

Full municipal services will be made available to this property immediately upon annexation.

Miscellaneous Provisions:

(1) The property owner and/or developer of property is responsible for the extension of water and sewer infrastructure to the property, in accordance with city regulations and specifications.

ANNEXATION SERVICE PLAN - Page I

(2) This service plan does not require a uniform level of full municipal services to each area of the City, including the annexed area, if different characteristics of topography, land use, and population density are considered a sufficient basis for providing different levels of service.

(3) This service plan shall not be amended unless public hearings are held in accordance with V.T.C.A., Local Government Code, Section 43.056 (k).

(4) This service plan is adopted as Exhibit "B" to the Ordinance annexing the property described in Exhibit "A" to the City of Justin. The City shall provide the area or cause the area to be provided with services in accordance with this service plan.

ANNEXATION SERVICE PLAN -Page 2