Ord 2014-070/Approving a petition submitted by Metcalfe, Wolfe, Stuart & Williams, LLP on behalf of Walton Texas, LP granting the consent of the City of San Marcos, Texas, to the creation of Cotton Center Municipal Utility District No. 1

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Section 2.06 District Residents' Rights. a. Qualified Voters. The qualified voters, if any, residing within the Limited Purpose Tract may vote in City elections pursuant to Local Government Code Sections 43.0751 (q) and 43.130. Voting rights are subject to all federal and state laws and regulations. b. City Citizen. A resident of an area of the District that is annexed for full purposes becomes a citizen of the City for all purposes and shall have all the rights, privileges, and responsibilities accorded to the citizens residing in all other areas that City has annexed for full purposes. Section 2.07 Notice to Landowners of Full Purpose and Limited Purpose Annexation of Land Within the District. District agrees to file the following notice concerning this Agreement in the Official Records of Caldwell County for the property within the District: The property within the boundaries of Cotton Center Municipal Utility District No.1 of Caldwell County, Texas (the "District "), as depicted on the map attached hereto, is subject to the terms and conditions of a Strategic Partnership Agreement ( "Agreement ") between the District and the City of San Marcos (the "City "), dated 20. The Agreement establishes a timetable for the annexation by City of the property in the District, a portion of which will be annexed initially for limited purposes and subsequently for full purposes. The annexation for full purposes may occur at any time after at least ninety percent (90 %) of the water, wastewater, drainage and road facilities have been constructed, and the developer in the District has been reimbursed by the District for the cost of the District facilities to the extent allowed in accordance with the rules of the Texas Commission on Environmental Quality. A copy of the Agreement may be obtained by contacting the offices of the District, and questions concerning the Agreement may be directed to District or the City of San Marcos. This notice with appropriate modifications shall also be included in the notice to purchasers of real property in the District in each future edition of the District's Information Form required to be recorded in the Official Records of Caldwell County, Texas, pursuant to Section 49.455 of the Texas Water Code. Section 2.08 Regulatory and Taxation Authority of the City and the District Upon Full Purpose Annexation of the District. Upon full purpose annexation of the District, City shall have all the authority and power, including taxation authority, within the District that City enjoys in all other areas that City has annexed or does annex for full purposes. Prior to full purpose annexation by City, District shall have all of the authority and power, including taxation authority, of a municipal utility district, except as modified by the terms and provisions of this Agreement and applicable law, so long as the District exists. ARTICLE III SERVICES TO THE DISTRICT Section 3.01 Municipal Services During the Period of Limited Purpose Annexation. C