Loading...
R-2260-2-04RESOLUTION NO. 2260-2-04(R) ' A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ALLEN, COLLIN COUNTY, TEXAS, APPROVING THE TERMS AND CONDITIONS OF AN INTERLOCAL AGREEMENT BY AND AMONG THE CITY OF ALLEN, TEXAS, CITY OF FRISCO, TEXAS, AND CITY OF PLANO, TEXAS, PERTAINING TO THE CREATION OF A PERFORMING ARTS CENTER IN COLLIN COUNTY, TEXAS; APPROVING THE ARTICLES OF INCORPORATION OF THE ARTS OF COLLIN COUNTY COMMISSION, INC.; APPROVING BYLAWS OF THIN ARTS OF COLLIN COUNTY COMMISSION, INC.; AUTHORIZING THE CITY MANAGER TO EXECUTE THE AGREEMENT AND ALL OTHER DOCUMENTS THEREIN; APPROVING NON -SUBSTANTIVE CHANGES IN DOCUMENTS; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City Council of the City of Allen, Texas, has been presented a proposed Interlocal Agreement by and among the City of Allen, Texas, City of Frisco, Texas, and City of Plano, Texas, pertaining to the creation of a performing arts center in Collin County, Texas, the Articles of Incorporation of the Arts of Collin County Commission, Inc., and the Bylaws of the Arts of Collin County Commission, Inc.; and, WHEREAS, upon full review and consideration of the Agreement, Articles of Incorporation, and Bylaws, and all matters related thereto, the City Council is of the opinion and finds that the terms and conditions thereof should be approved, and that the City Manager should be authorized to execute the Agreement and all other ' documents therein on behalf of the City of Allen, Texas. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ALLEN, COLLIN COUNTY, TEXAS, THAT: SECTION 1. The terms and conditions of the Agreement, a copy of which is attached hereto as Exhibit "A" and incorporated herein by reference, having been reviewed by the City Council of the City of Allen and found to be acceptable and in the best interests of the City of Allen and its citizens, be, and the same is hereby, in all things approved. SECTION 2. The City of Allen approves the Articles of Incorporation of the Arts of Collin County, Inc., a copy of which is attached hereto as Exhibit "B" and incorporated herein by reference. SECTION 3. The City of Allen approves the Bylaws of the Arts of Collin County, Inc., a copy of which is attached hereto as Exhibit "C" and incorporated herein by reference. SECTION 4. The City Manager is hereby authorized to execute the Agreement and all other documents in connection therewith on behalf of the City of Allen, substantially according to the terms and conditions set forth in the Interlocal Agreement and this Resolution. SECTION 5. Any non -substantive changes in documents may be approved by the City Manager without the passage of a new resolution. SECTION 6. The City Secretary shall forward a certified copy of this Resolution to the City Secretary of the City of Plano and the City of Frisco. SECTION 7. This Resolution shall become effective from and after its passage 1 DULY PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF ALLEN, COLLIN COUNTY, TEXAS, ON THIS THE W" DAY OF FEBRUARY, 2004. APPROVED: Stephen fermil, MAYOR ATTEST: 451x.". Shelley B. Geos , TRMC, CITY SECRETARY Resolution No. 2260-2-04(R), Page 2 AGREEMENT BY AND BETWEEN THE CITY OF ALLEN, TEXAS, THE CITY OF FRISCO, TEXAS, AND THE CITY CITY OF PLANO, TEXAS, PERTAINING TO THE CREATION OF A PERFORMING ARTS CENTER IN COLLIN COUNTY, TEXAS THE STATE OF TEXAS COUNTY OF COLLIN THIS AGREEMENT (this "Agreement") is made by and between the City of Allen, Texas, a municipal corporation and home -rule city in the State of Texas ("Allen'); the City of Frisco, Texas, a municipal corporation and home -rule city in the State of Texas ("Frisco"); and the City of Plano, Texas, a municipal corporation and home -rule city in the State of Texas ('Plano"), pursuant to Chapter 791, Texas Government Code, as amended. The cities of Allen, Frisco, and Plano are collectively referred to herein as the "Cities" and each is individually a "City." WITNESSETH: WHEREAS, each City desires to construct and operate certain performing and cultural arts facilities (the "Facilities") and has determined that the construction and operation of such Facilities is in the best interests of its citizens and each City, and promotes economic development; and WHEREAS, the Cities have found and determined that the joint construction, ownership and operation of the Facilities will enable the Cities to pool their resources and will provide the most effective, economic and efficient means of developing the Facilities; and WHEREAS, the Cities have decided to jointly create a local government corporation under Subchapter D of Chapter 431, Texas Transportation Code (the "Act"), to be known as the Arts of Collin County Commission, Inc. (the "Corporation"), which will finance, construct, own, manage and operate the Facilities; and WHEREAS, it is the intention of the Cities that this Agreement set forth the rights and responsibilities of each City pertaining to the creation of the Corporation, the financing, construction, operation and management of the Facilities to be provided jointly by the Cities acting through the Corporation, and certain other provisions relating to the Corporation; and WHEREAS, subsequent to the execution of this Agreement, the Cities intend to execute a "Contribution Agreement" with the Corporation under which each City will approve the specific Facilities (the Approved Project) to be developed by the Corporation and pursuant to which each City's capital contribution with respect to an Approved Project will be in exchange for the right to use the Approved Project in accordance with the terms and provisions of this Agreement and such Contribution Agreement; and A F& 3113 WHEREAS, under a Contribution Agreement, each City will agree to pay a percentage of the operation and maintenance expenses ('O&M Expenses'l of an — -- Approved Project equal to that City's population divided by the total population of the Cities, based on the annual population estimates provided by North Central Texas Council of Governments as of the start of that calendar year; and WHEREAS, the Cities intend to secure their respective obligations to pay O&M expenses with respect to an Approved Project under a Contribution Agreement with an ad valorem tax pledge, but will remain free to meet said obligations out of any available revenue source. NOW, THEREFORE, for and in consideration of the premises and the mutual covenants and agreements herein contained, it is agreed as follows: ARTICLE I CREATION OF LOCAL GOVERNMENT CORPORATION The Cities will jointly create the Corporation under the Act for the purpose of financing, constructing, owning, managing and operating Approved Projects, all in accordance with the terms and provisions of this Agreement. To this end, the Cities agree to formally approve by ordinance, resolution or order, and to cause to be filed with the Texas Secretary of State, the Articles of Incorporation of the Corporation (the "Articles') in substantially the form attached hereto as Exhibit A. In addition, the Cities agree to formally approve by ordinance, resolution or order the Bylaws of the Corporation (the "Bylaws") in substantially the form attached hereto as Exhibit B, and the Arts of Collin County's Vision Statement, as shown on Exhibit C, attached hereto. ARTICLE II THE FACILITIES 1. Description of the Facilities It is intended that the Facilities will be constructed on one or more locations in Collin County, Texas on approximately 100 acres and consist generally of performance halls, exhibition areas, rehearsal and meeting rooms and related facilities, the specific description and costs of which are to be set forth in a Contribution Agreement with respect to each Approved Project. 2. Financing Approved Projects The Cities will execute a Contribution Agreement with respect to each Approved Project, which will contain, along with the terms and conditions contained in this Agreement and such other terms and conditions as shall be agreed to by the Cities, the following provisions: a. Each City will make a capital contribution to the Corporation with respect to an Approved Project. b. Each City will agree to pay on a quarterly basis, a percentage of the O&M Expenses of the Approved Project equal to that city's population divided NF6 3 aA by the total population of the Cities, based on the annual population estimates provided by North Central Texas Council of Governments as of the start of that calendar year. Each City will secure its respective obligations under the Contribution Agreement with an ad valorem tax pledge and will take all appropriate action to levy such tax. Cities may actually pay these obligations with any funds available to them suitable for this purpose. 3. Canital Improvement Fund. A capital improvement fund (the "Capital Improvement Fund") will be established in the annual budget of the Corporation (the "Budget"). The budget will be prepared by the Board of Directors of the Corporation (the `Board") and approved by the Cities as set forth in the Bylaws. The Board may use the funds in the Capital Improvement Fund to make such improvements to Approved Projects or such other property of the Corporation as the Board deems to be in the best interests of the Project and the Corporation; provided, however, if the Cities stipulate how funds allocated to the Capital Improvement Fund or other funds created in the Budget are to be expended, the Board may only expend such funds for the stipulated purposes. The Board may expend these funds for capital improvements only for Approved Projects. Funds that are received from other sources may be expended as permitted under this Agreement. The Capital Improvement Fund will be in an amount customary for facilities comparable to Approved Projects in both size and use. 4. Additional Approved Projects. Following the initial Approved Project and upon the recommendation of the Board, the Cities may from time to time agree to allocate additional capital funds to the Corporation so that the Corporation may acquire additional land, improvements or facilities for additional Facilities; provided, however, such additional Facilities may only be undertaken by the Corporation if approved as an Approved Project by the unanimous written consent of the Cities and in accordance with a Contribution Agreement. 5. Use of Project. In the Contribution Agreement, the Cities will agree that the use of an Approved Project and any other property of the Corporation will be governed by the "Usage Policy' established by the Board and approved by the Cities under the Bylaws. Users other than the Cities may contract with the Corporation for the use of Approved Projects as provided in the Usage Policy. 6. Ownership. Each Approved Project will be owned by the Corporation, with the rights and responsibilities with respect to each Approved Project specified in a Contribution Agreement, in the Articles of Incorporation of the Corporation and in this Agreement. 7. Termination of Obligations under Contribution Agreements Each Contribution Agreement will govern the termination of a City's obligations relating to a specific Approved Project and the Corporation. A/F0 31LA Contribution Agreements will provide that, in order to terminate its obligations relating to the Approved Project, a City must also terminate all ----�— interests, rights and claims relating to the Approved Project and the Corporation, including without limitation: (a) the right of its citizens to use the Approved Project or other property of the Corporation on a preferential basis; (b) the right to participate in the management or operation of the Approved Project or the Corporation, including Board appointments; (c) any claim to be reimbursed for any prior expenditures relating to the Project or the Corporation; and (d) the right of remaining Owners (as defined below) to share in the assets of the Corporation upon the ultimate dissolution of the Corporation, including all capital contributions b. The Contribution Agreement will provide that a City may terminate its interests in the Approved Project and the Corporation at any time with the consent of each of the remaining Cities. The Contribution Agreement will further specify that a City may terminate its interests in the Approved Project and the Corporation without the consent of each of the remaining Cities only if: (a) the notice of termination is given no earlier than the seventh anniversary of the date of execution of this Agreement by the withdrawing City; (b) the withdrawing City gives each of the remaining Cities three (3) years prior written notice of its intention to withdraw from the an Approved Project and the Corporation; (c) if the Corporation has any outstanding debt obligations, the withdrawing City makes provision for the payment of all amounts pledged by that City, if any, as security for the outstanding debt obligations of the Corporation; (d) the withdrawing City shall be responsible for its percentage of the O&M costs for three (3) years following notice of withdrawal; and (e) the withdrawing City forfeits all rights and interest in the Approved Project, including but not limited to all capital expenditures and those rights as stated in Ta. above. 8. Tax Exempt Status. The Project's land and improvements shall be exempt from ad valorem taxation, however certain joint ventures and lease hold interests maybe subject to taxation. 9. Leases. The Corporation may approve leases of equipment and portions of its facilities for a short to intermediate term basis (less than five years). All other leases or encumbrance of Approved Projects must be approved by the Owners. ARTICLE III POWERS RESERVED TO CITIES The Corporation shall have all powers provided by law except those that are reserved by the Cities. The following rights are specifically reserved by the Cities: (a) Expansion of Approved Projects beyond existing approved scope; NF6 311A (b) Adding new Owners or Members as defined below; (c) Incurring long term debt except with prior approval of the Cities (Owners); (d) Changing the mission or purpose of the Corporation; (e) Authorizing a capital expense for which the Cities have not approved the capital funding and the expenditure of these funds except in circumstances where the funds are obtained by the Corporation from private or other sources and the expenditure is consistent with the Bylaws; (f) Sale or disposal of an asset whose value exceeds $50,000; (g) Signatory naming rights. (h) Leasing of any real property but not to include short term rentals of space or equipment as described in Article II, Section 9. ARTICLE IV ADDITIONAL PARTICIPANTS The Corporation may allow additional units of government, and profit and non- profit corporations to have rights and obligations for Approved Projects in accordance with the following criteria: Owners. Owners are units of local government that have contributed a share of the capital cost of an Approved Project and who agree to be responsible for all other costs and responsibilities of the Project with the other Owners per the terms agreed to by the existing Owners at that time. Owners shall have the right to appoint one member to the Board; and rights to priority scheduling for use of the Project as well as use by its resident arts groups, independent school districts located within the boundaries of the Owners, and other organizations as determined by the Owners and the Usage Policy. Only Owners may advertise their participation in this Project for marketing and economic development purposes. In order to become an Owner, the current Owners must give unanimous consent. Members. Members are units of local government who agree to pay on an annual basis a proportionate share of "O&M' expenses for the Project. The amount to be paid is based upon the population of that member city using the same formula that is applied to Owners for their share of O&M expenses or as otherwise agreed to by all the existing Owners. Members do not have any Board appointment rights. Members shall be given preference in scheduling for the Projects after Owner scheduling, and receive a reduced rate per the terms of the Usage Policy as long as their annual fees are current. Membership status is conferred by unanimous consent of the Owners and may be revoked by the Owners. Veen. 3 RA Supporters. Supporters are private and public corporations and other entities -�...- including individuals who contribute funds or other items of value, which are used to offset operational costs or other expenses for the Project. In exchange for these contributions, the supporters may receive: naming rights for facilities (major naming rights must be approved by the Owners) or portions thereof for a limited period; sponsorship recognition status on advertisements and other publications; reduced rates for use of Facilities; scheduling preferences after Owners and Members; and other benefits as determined by the Board. Supporter status is determined and granted by the Board. Patrons. A Patron may schedule the facility after priority and preferred scheduling is granted to Owners, Members, and Supporters. Rates for Patrons will be determined by the Board. Patrons that are Collin County residents or businesses shall have priority scheduling over non -Collin County counterparts except that once a booking is made, it will be honored even if subsequent to the booking a Collin County organization requests that date. ARTICLE V MISCELLANEOUS PROVISIONS Employees. (a) Under the Bylaws, the Executive Director of the Corporation shall be responsible for supervising, hiring and firing of all employees and contractors providing services to the Corporation. All employees are at will employees for their services to the Corporation. - -- (b) The Cities intend to enter into a contract with the Corporation under which one or more of the Cities will provide employment services and benefits to the Corporation. Expenses related to these employment services, including, without limitation, expenses related to compensation and employment benefits, shall be O&M expenses of the Corporation and paid out of funds allocated to that purpose in the Budget. Employees working for the Corporation will be considered employees of the City for services and benefits. 2. Additional Projects. The Cities may from time to time authorize the Corporation to carry out additional projects under the procedures established in the Contribution Agreement. Such additional projects may be financed by any method available to the Cities; provided, however, such additional projects may only be undertaken with the unanimous written consent of the Cities and in accordance with the Contribution Agreement. 3. Additional Participants. Additional units of local government may join the Corporation, participate in the Project or participate in future projects of the A/F& 3 ILA Corporation with the unanimous written consent of the Cities and in accordance with the Contribution Agreement and the terms of this Agreement. 4. Consent of the Cities. All references herein to the consent or written consent of a City shall refer to an ordinance, resolution or order of the governing body of the City. ARTICLE VI MISCELLANEOUS 1. Term. The tern of this Agreement shall be a period of twenty-five (25) years commencing upon the effective date hereof. 2. Venue The laws of the State of Texas shall govem the interpretation, validity, performance and enforcement of this Agreement. The parties agree that this Agreement is performed in Collin and Denton Counties, Texas, and that exclusive venue shall lie in Collin County, Texas. 3. Simature. Upon approval, each City shall have an authorized representative execute the Agreement. 4. Amendments. This Agreement may only be amended upon unanimous agreement of the Cities. CITY OF ALLEN, TEXAS Date: o��/��� BY: ATTEST: CITY SECRETAW APPRO SAS TOr FORM: CITY ATTORNEY AIFOb 3ILA CITY OF FRISCO, TEXAS - - Date:_peb. (0ZIT BY: < ATTEST: APPROVED AS TO FORM: -� CITY ATTORNEY CITY OF PLANO, TEXAS Date: a!'��"f _ c���CD ��o„--ck ATTEST: )(.AI tI &—" Off J Elaine Bealke, CITY SECRETARY APPROVED AS TO FORM: .(l�/�l C• /.f�CwLG� Diane C. Wetherbee, CITY ATTORNEY A eb.311 ARTICLES OF INCORPORATION OF ARTS OF COLLIN COUNTY COMMISSION, INC. We, the undersigned natural persons, each of whom is at least eighteen (18) years of age or more, and a resident and a qualified voter of the City of Allen, Texas, the City of Frisco, Texas, or the City of Plano, Texas (collectively, the "Cities" and, each individually, a "City") and a citizen of the State of Texas, acting as incorporators of a corporation under the provisions of Subchapter D of Chapter 431, Texas Transportation Code (the "Act"), and Chapter 394, Texas Local Government Code, do hereby adopt the following Articles of Incorporation for such corporation: ARTICLE I The name of the corporation is the Arts of Collin County Commission, Inc. (the "Corporation"). ARTICLE II The Corporation is a public non-profit corporation. ARTICLE III The period of duration of the Corporation shall be perpetual. ARTICLE IV The Corporation is organized and will be operated exclusively for one or more charitable purposes, within the meaning of Section 501(c)(3) of the U.S. Internal Revenue Code of 1986, as amended (the "Code"). The Corporation is organized for the purpose of aiding, assisting, and acting on behalf of the Cities in the performance of their governmental functions to promote the common good and general welfare of the cities, and to promote, develop, encourage and maintain cultural facilities, commerce and economic development in the Cities. The Corporation is further organized to aid, assist and act on behalf of the Cities by financing, constructing, owning, managing and operating performing and visual cultural arts facilities, together with land and improvements related thereto, and other cultural facilities. Subject to applicable state law and any contractual obligations of a City or the Corporation, a City or Cities may discontinue participation in the activities of the Corporation, or a non -participating unit of local government, business, or individuals may join in the activities of the Corporation, under procedures established in the Bylaws of the Corporation (the "Bylaws"). The Corporation is formed pursuant to the provisions of the Act as it now or may hereafter be amended, and Chapter 394, Texas Local Government Code, which A:Feb.3 ACC idm authorizes the Corporation to assist and act on behalf of the Cities and to engage in activities in the furtherance of the purposes for its creation. The Corporation shall have and exercise all of the rights, powers, privileges, authority, and functions given by the general laws of Texas to non-profit corporations incorporated under the Act including, without limitation, Article 1396 Vernon's Texas Civil Statutes (the Texas Non -Profit Corporation Act). The Corporation shall have all other powers of a like or different nature not prohibited by law which are available to non-profit corporations in Texas and which are necessary or useful to enable the Corporation to perform the purposes for which it is created, including the power to issue bonds, notes or other obligations, and otherwise exercise its borrowing power to accomplish the purposes for which it was created; provided, however, that the Corporation shall not issue any bond, certificate, note or other obligation evidenced by an instrument without the written consent of each of the Cities or as otherwise allowed by the Bylaws. The Corporation is created as a local government corporation pursuant to the Act and shall be a governmental unit within the meaning of Subdivision (2), Section 101.001, Texas Civil Practice and Remedies Code. The operations of the Corporation are governmental and not proprietary functions for purposes of the Texas Tort Claims Act, Section 101.001 et seq., Texas Civil Practice and Remedies Code. The Corporation shall have the power to acquire land in accordance with the Act as amended from time to time. References herein to the consent or written consent of a City shall refer to an ordinance, resolution or order of the governing body of the City. ARTICLE V The Corporation shall have no members and shall have no stock. ARTICLE VI All powers of the Corporation shall be vested in a Board of Directors ("Board") consisting initially of five (5) persons. Additional persons may be added to the Board in accordance with the Bylaws. The initial directors of the Corporation ("Director" or "Directors') shall be those persons named in Article VIII. Each initial Director named in Article VIII hereof shall serve for the term prescribed in Article VIII. Subsequent Directors shall be appointed to the Board as prescribed in the Bylaws. Except as provided in the Articles of Incorporation, each Director shall serve for the term provided in the Bylaws. Any Director may be removed from office at any time, with or without cause, by the entity responsible for the appointment of that Director under the Bylaws. The initial President of the Board shall be George S. Robinson and the Board shall designate by majority vote each subsequent President of the Board. A:F&. 3 ACC Arid. All other matters pertaining to the internal affairs of the Corporation shall be governed by the Bylaws, so long as such Bylaws are not inconsistent with these Articles of Incorporation, or the laws of the State of Texas. ARTICLE VII The street address of the initial registered office of the Corporation is 210 W. McDermott, Allen, Texas 75013 and the name of its initial registered agent at such address is George S. Robinson. ARTICLE VIII The number of Directors initially constituting the Board is five (5). The names, addresses and terms of office of the five (5) initial Directors, a majority of whom reside within one of each of the Cities, are: NAME ADDRESS TERM EXPIRES Maher M. Maso 10902 Ormond Lane, Frisco, Texas 75035 September 30, 2005 George S. Robinson 5044 Bridge Creek Drive, Plano, Texas 75093 September 30, 2006 Betty Bell Muns 5502 St. Andrews Court, Plano, Texas 75093 September 30, 2006 Lonnie R. Thomas 610 English Oak, Allen, Texas 75002 September 30, 2007 Nick Barretta 12 Woodcreek Lane, Frisco, Texas 75034 S tember I, 2007 ARTICLE IX The names and street addresses of the incorporators, each of whom resides within one of the Cities forming the corporation are: PL"73I sl ADDRESS George S. Robinson 5044 Bridge Creek Drive Plano, Texas 75093 Maher Maso 10902 Ormond Lane Frisco, Texas 75035 Steve Matthews 103 W. McDermott, Suite 200 Allen, Texas 75013 A:Feb. 3 ACC Article ARTICLE X Resolution No. 2260-2-04(R) approving the form of these Articles of Incorporation has been adopted by the City Council of the City of Allen, Texas, on February 24, 2004. Resolution No. 04-02-29(R) approving the form of these Articles of Incorporation has been adopted by the City Council of the City of Frisco, Texas on February 10, 2004. Resolution No. 2004-2-6(R) approving the form of these Articles of Incorporation has been adopted by the City Council of the City of Plano, Texas, on February 9, 2004. ARTICLE XI No Director shall be liable to the Corporation for monetary damages for an act or omission in the Director's capacity as a Director, except for liability (i) for any breach of the Director's duty of loyalty to the Corporation, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a ]mowing violation of law, (iii) for any transaction from which the Director received an improper benefit, whether or not the benefit resulted from an act taken within the scope of the Director's office, or (iv) for acts or omissions for which the liability of a Director is expressly provided by statute. Any repeal or amendment of this Article by the Directors shall be prospective only, and shall not adversely affect any limitation on the personal liability of a Director existing at the time of such repeal or amendment. In addition to the circumstances in which a Director is not personally liable as set forth in the preceding sentences, a Director shall not be liable to the fullest extent permitted by any amendment to the Texas statutes hereafter enacted that further limits the liability of a Director. ARTICLE XII In accordance with the provisions of Section 501(c)(3) of the Code, and regardless of any other provisions of these Articles of Incorporation or the laws of the State of Texas, the Corporation: (a) shall not permit any part of the net earnings of the Corporation to inure to the benefit of any private individual; (b) shall not devote more than an insubstantial part of its activities to attempting to influence legislation by propaganda or otherwise; (c) shall not participate in, or intervene in (including the publication or distribution of statements), any political campaign on behalf of any candidate for public office; and (d) shall not attempt to influence the outcome of any election for public office or to carry on, directly or indirectly, any voter registration drives. Any income earned by the Corporation after payment of reasonable expenses, debt and establishing a reserve shall accrue to the Cities in an amount that is in proportion to the percentage of funds each City contributed to the Corporation's annual budget for that year. The Cities shall, at all times, have an unrestricted right to receive any income earned by the Corporation, in an amount that is in proportion to the percentage of funds A: Feb. 3 ACC Amid. each City contributed to the Corporation's annual budget for that year exclusive of amounts needed to cover reasonable expenditures and reasonable reserves for future activities. No part of the Corporation's income shall inure to the benefit of any private interests. If the Board of Directors determines by resolution that the purposes for which the Corporation was formed have been substantially met and all bonds issued by and all obligations incurred by the Corporation have been fully paid, the Board shall execute a certificate of dissolution which states those facts and declares the Corporation dissolved in accordance with the requirements of Section 394.026 of Texas Local Government Code, or with applicable law then in existence. Any capital project(s) of the Corporation as well as all plans and specifications of any improvement to be made by the Corporation where the project or improvement's value is in excess of $100,000 or adds to the annual operations and maintenance costs by more than the limit established in the Bylaws shall be approved in writing by each of the Cities unless otherwise authorized by the Bylaws. ARTICLE XIII If the Corporation is a private foundation within the meaning of Section 509(a) of the Code, the Corporation: (a) shall distribute its income for each taxable year at such time and in such manner as not to become subject to the tax on undistributed income imposed by Section 4942 of the Code; (b) shall not engage in any act of self-dealing as defined in Section 4941(d) of the Code; (c) shall not retain any excess business holdings as defined in Section 4943(c) of the Code; (d) shall not make any investments in such manner as to subject it to tax under Section 4944 of the Code; and (e) shall not make any taxable expenditures as defined in Section 4945(d) of the Code. ARTICLE X1V Subject to any restrictions contained in applicable state law, if each of the Cities considers and approves a concurrent resolution, ordinance or order directing the Board to proceed with the dissolution of the Corporation, the Board shall promptly proceed with the dissolution of the Corporation. The failure of the Board to promptly proceed with the dissolution of the Corporation in accordance with this Section shall be deemed a cause for the removal from office of any or all of the Directors as permitted by Article VI of these Articles of Incorporation. Upon the dissolution of the Corporation, the assets of the Corporation shall be distributed equally among the cities then participating in the activities of the Corporation. A -Feb. 3 ACC Articles ARTICLE XV These Articles may not be changed or amended unless approved in writing by each of the Cities. IN WITNESS WHEREOF, we have hereunto set our hands this //-4L day of ma&L4. 200 . George S. Robinson Maher Maso Steve Matthews o ' pay p' ACKNOWLEDGMENTS ; c/'=` °m'+ n STATE OF TEXAS ) n +O�P i„umn mm�ne1N� COUNTY OF CO/�,N ) This instrument was acknowledged before me on the AD day of , 200-, by George S. Robinson. Notary Public, State of Texas STATE OF TEXAS COUNTY OF e©lli'n This instrument was acknowledged before me on the day of eurA— , 2004t, by Maher Maso. 3 A:Feb. 3 ACC M10% ' 404 Notary Public, State of Texas STATE OF TEXAS COUNTY OF (Wl/,x This instrument was acknowledged before me on the S'� day of �jat,'jt , 200' _, by Steve Matthews. Notary Public, State of Te)(as �r r7117 \ LYNNE A. NEMPER � ,• MNo1vY Puck, ahb of ipm ""NNN���?m� Y mmnbelon Exgiu 77-0&08 A.Feb. 3 ACC Articles BYLAWS OF THE ARTS OF COLLIN COUNTY COMMISSION, INC. A Texas Local Government Corporation created on behalf of the Cities of Allen, Frisco, and Plano, Texas ARTICLE I PURPOSES The Arts of Collin County Commission, Inc. (the "Corporation") is organized and will be operated exclusively for one or more charitable purposes, within the meaning of Section 501(c)(3) of the U.S. Internal Revenue Code of 1986, as amended (the "Code'). The Corporation is organized for the purpose of aiding, assisting, and acting on behalf of the City of Allen, Texas, the City of Frisco, Texas, and the City of Plano, Texas (collectively the "Cities" and, each individually, a "City") in the performance of their governmental functions to promote the common good and general welfare of the Cities, and to promote, develop, encourage and maintain cultural arts facilities, commerce and economic development in the Cities. The Corporation is further organized to aid, assist and act on behalf of the Cities by financing, constructing, owning, furnishing, managing and operating perforating and visual cultural arts facilities, together with land and improvements related thereto, and other related facilities ("Cultural Facilities'. Subject to applicable state law and any contractual obligations of a City or the Corporation, a City or Cities may discontinue participation in the activities of the Corporation, or a non -participating unit of local government may join in the activities of the Corporation, under procedures established in these Bylaws. The Corporation is formed pursuant to the provisions of Subchapter D of Chapter 431, Texas Transportation Code (the "Ace'), as it now or may hereafter be amended, and Chapter 394, Texas Local Government Code, which authorizes the Corporation to assist and act on behalf of the Cities and to engage in activities in the furtherance of the purposes for its creation. The Corporation shall have and exercise all of the rights, powers, privileges, authority, and functions given by the general laws of Texas to non-profit corporations incorporated under the Act including, without limitation, Article 1396, Vernon's Texas Civil Statutes (the Texas Non -Profit Corporation Act). The Corporation shall have all other powers of a like or different nature not prohibited by law which are available to non-profit corporations in Texas and which are BYLAWS Page 1 A: Feb. 3 Bylaws necessary or useful to enable the Corporation to perform the purposes for which it is created, including the power to issue bonds, notes or other obligations, and otherwise exercise its borrowing power to accomplish the purposes for which it was created; provided, however, that the Corporation shall not issue any bond, certificate, now or other obligation evidenced by an instrument without the written consent of each of the Cities and except as authorized under Section 3 of Article IV Financial Responsibilities of these Bylaws. The Corporation is created as a local government corporation pursuant to the Act and shall be a governmental unit within the meaning of Subdivision (2), Section 101.001, Texas Civil Practice and Remedies Code. The operations of the Corporation are governmental and not proprietary functions for purposes of the Texas Tort Claims Act, Section 101.001 et seq., Texas Civil Practice and Remedies Code. The Corporation shall have the power to acquire land in accordance with the Act as amended from time to time. Each City and any other unit of local government that executes binding commitments to provide funding and otherwise is qualified to appoint a Director to the Board as permitted by these Bylaws or other documents, shall be referred to as an "Owner", and they are collectively referred to as "Owners". All references herein to the consent or written consent of a City or an Owner shall refer to an ordinance, resolution or order of the governing body of the City or Owner. ARTICLE H BOARD OF DIRECTORS Section 1. Appointment, Powers, Number, and Term of Office. All powers of the Corporation shall be vested in a Board of Directors ("Board"). The Board shall independently manage and operate the Cultural Facilities in accordance with all applicable laws and documents, including the Articles of Incorporation, these Bylaws, the Contribution and Interlocal Agreements, the Arts of Collin County Vision Statement and such other documents agreed to by the Owners and as the same may be amended from time to time. The Board shall initially consist of five (5) persons. The number of Directors on the Board may only be increased or decreased in accordance with these Bylaws. Directors of the Corporation ("Director" or "Directors') shall be appointed to the Board as follows: (a) Each Owner shall be entitled to appoint one (1) Director to the Board in accordance with Owner's criteria for Board appointments and the remaining Directors shall be appointed by unanimous agreement of the Owners. The number of Directors shall increase or decrease if the number of Owners increases or decreases. However, the number of Directors shall never be less than five (5) and the Board shall always be composed of an odd number. BYLAWS Page 2 A: F& 3 Bylaws For the initial Board, the terms shall be staggered with one of the Owner's selections serving a one (1) year term, two of the Owner's selections serving a two (2) year term and the remaining Directors serving a full three (3) year term. Thereafter, each Director shall serve for a three (3) year term, or until his or her successor is appointed by the entity authorized to appoint the Director; provided, however, upon the death, resignation or removal of a Director, the entity responsible for that Director's appointment shall appoint a replacement Director to serve for the unexpired term of office of the replaced Director. No term limits are imposed by these Bylaws. Any restriction as to term is governed by the entity appointing such Director. (b) Any Director may be removed from office at any time, with or without cause, by the entity authorized to appoint that Director. Directors appointed jointly by all Owners may be removed at any time by unanimous vote of all Owners. (c) All Directors shall have full and equal voting rights. All references herein to an act, resolution or vote of the Directors shall refer to a vote of the Directors entitled to vote on the matter as provided herein. Section 2. Meetings of Directors. The Directors may hold their meetings and may have an office and keep the books of the Corporation at such place or places within Collin County as the Board may from time to time determine; provided, however, in the absence of any such determination, such place shall be the registered office of the Corporation in the State of Texas. The Board shall meet in accordance with and file notice of each meeting of the Board for the same length of time and in the same manner and location as is required of a City under Chapter 551, Texas Government Code (the "Open Meetings Act'j. The Corporation, the Board, and any committee of the Board exercising the powers of the Board are subject to Chapter 552, Texas Government Code (the "Open Records Ace'). Section 3. Annual Meetings. The annual meeting of the Board shall be held at the time and at the location in Collin County designated by the resolution of the Board for the purposes of transacting such business as may be brought before the meeting. Section 4. Regular Meetings. Regular meetings of the Board shall be held at least quarterly at such times and places as shall be designated, from time to time, by resolution of the Board. Section 5. Special and Emergency Meetings. Special and emergency meetings of the Board shall be held whenever called by the President of the Board or the Secretary or by a majority of the Directors who are serving duly appointed terms of office at the time the meeting is called. BYLAWS Page 3 A: Feb.3 Bylaws The Secretary shall give notice of each special meeting in person, by telephone, facsimile, mail or email at least three (3) days before the meeting to each Director and to the public in compliance with the Open Meetings Act. Notice of each emergency meeting shall also be given in the manner required of the Cities under Section 551.045 of the Open Meetings Act. Unless otherwise indicated in the notice thereof, any and all matters pertaining to the purposes of the Corporation may be considered and acted upon at a special or emergency meeting. At any meeting at which every Director shall be present, even though without any notice, any matter pertaining to the purposes of the Corporation may be considered and acted upon to the extent allowed by the Open Meetings Act. Section 6. Quorum. A majority of the Board then appointed and serving shall constitute a quorum for the consideration of matters pertaining to the purposes of the Corporation. If at any meeting of the Board there is less than a quorum present, a majority of those present may adjourn the meeting. The act of a majority of the Directors present and voting at a meeting at which a quorum is in attendance shall constitute the act of the Board, unless the act of a greater number is required by law, by the Articles of Incorporation, or by these Bylaws. A Director who is present at a meeting of the Board at which any corporate action is taken shall be presumed to have assented to such action unless his dissent or abstention shall be entered in the minutes of the meeting or unless he shall file his written dissent or abstention to such action with the person acting as the secretary of the meeting before the adjournment thereof or shall forward such dissent or abstention by registered mail to the Secretary of the Corporation immediately after the adjournment of the meeting. Such right to dissent or abstain shall not apply to a Director who voted in favor of the action. Section 7. Conduct of Business. At the meetings of the Board, matters pertaining to the purpose of the Corporation shall be considered in such order as the Board may from time to time determine. At all meetings of the Board, the President shall preside, and in the absence of the President, the Vice President shall preside. In the absence of the President and the Vice President, an acting President shall be chosen by the Board from among the Directors present. The Secretary of the Corporation shall act as secretary of all meetings of the Board, but in the absence of the Secretary, the presiding officer may appoint any person to act as secretary of the meeting. Section 8. Executive Committee, Other Committees. The Board may, by resolution passed by a majority of the Directors, designate two (2) or more Directors to constitute an executive committee or other type of committee. In addition, the Board may appoint members of Corporation staff and citizens of the Owners to be members of a committee, except for an Audit, Compensation or Governance Committee, which committees may only be composed of Directors. BYLAWS Page 4 A: Feb.3 Bylaws To the extent provided in the authorizing resolution for the committee and the Board approved committee charter, a committee shall have and may exercise the authority of the Board in the management of the Corporation, except where action of the Board is specified by statute. Each committee so designated shall keep regular minutes of the transactions of its meetings and shall cause such minutes to be recorded in books kept for that purpose in the office of the Corporation, and shall report the same to the Board from time to time. Committees authorized to exercise the powers of the Board shall give notice of any meeting in the manner required for a meeting of the Board. Committees are subject to the regulations which apply to committees of government entities including the open records and open meetings acts. Section 9. Compensation of Directors. Directors, as such, shall not receive any salary or compensation for their services as Directors; provided, however, Directors may be reimbursed for reasonable and necessary expenses incurred in carrying out the Corporation's purposes. Section 10, Advisory Committee. The Board shall establish an Advisory Committee composed of members who are, in the judgment of the Board, qualified to advise with respect to the activities of the Corporation. The size of the Advisory Committee will be determined by the Board and may be adjusted from time to time. The Board will designate one of its Directors to be a liaison to the Advisory Committee to assure close communication between the Board and the Advisory Committee. Committee Members shall serve for a term of one (1) year or such longer term as may be fixed by the Board. Committee Members may be removed by the Board at any time, with or without cause. The officers and Directors of the Corporation may consult with the Advisory Committees from time to time with respect to the activities of the Corporation, but the Advisory Committee shall in no way exercise or restrict the powers of the Board nor limit its responsibility for the management of the affairs of the Corporation. Committee Members shall not receive any salary or compensation for their services; provided, however, Committee Members may be reimbursed for reasonable and necessary expenses incurred in carrying out the Corporation's purposes with prior approval of the Board. Section 11. Director's Reliance on Consultant Information. A Director shall not be liable if while acting in good faith and with ordinary care, he or she relies on information, opinions, reports or statements, including financial statements and other financial data, concerning the Corporation or another person that were prepared or presented by: (a) one or more other officers or employees of the Corporation; BYLAWS Page 5 A: Feb. 3 Bylaws (b) an employee of an Owner, Member, Supporter, or Patron. The terms "Member," "Supporter," and "Patron" in this section and in section 7 (c) of Article III have that meaning as set forth in Article IV of the Interlocal Agreement; (c) legal counsel, public accountants, or other persons as to matters the officer reasonably believes are within the person's professional or expert competence; or, (d) a committee of the Board of which the Director is not a member. Section 12. Executive Director. The Board is authorized to hire an Executive Director who shall serve at the pleasure of the Board. The Board shall establish the compensation, duties and other responsibilities of the Executive Director. The hiring and/or removal of the Executive Director shall be by a majority vote of the appointed Board. ARTICLE III OFFICERS Section 1. Titles and Term of Office. The officers of the Corporation shall be a President, one or more Vice Presidents, a Secretary, a Treasurer, and such other officers as the Board may from time to time elect or appoint. One person may hold more than one office, except the President shall not hold the office of Secretary. The term of office for each officer shall commence on the date of such officer's election and terminate on the earlier of (a) the date that the officer is replaced by the Board; or (b) if the officer is a member of the Board, the date that the officer is no longer a member of the Board. All officers shall be appointed and subject to removal, with or without cause, by a vote of a majority of the Board. A vacancy in any office shall be filled by a vote of a majority of the Board. Section 2. Powers and Duties of the President. The President shall be a member of the Board and shall preside at all meetings of the Board. He or she shall have such duties as are assigned by the Board. The President may call special or emergency meetings of the Board. In furtherance of the purposes of the Corporation and subject to the limitations contained in the Articles of Incorporation, the President or Vice President may sign and execute all bonds, notes, deeds, conveyances, franchises, assignments, mortgages, notes, contracts and other obligations in the name of the Corporation. The President shall be an ex -officio member of all committees. Section 3. Powers and Duties of the Vice President. A Vice President shall be a member of the Board and shall have such powers and duties as may be assigned to him or her by the Board or the President, including the performance of the duties of the President upon the death, absence, disability, or resignation of the President, or upon the President's inability to perform the duties of his or her office. Any action taken by the BYLAWS Page 6 A: Feb.3 Bylaws Vice President in the performance of the duties of the President shall be conclusive evidence of the absence or inability to act of the President at the time such action was taken. Section 4. Treasurer. The Treasurer shall have custody of all the funds and securities of the Corporation which come into his or her hands. When necessary or proper, he or she may endorse, on behalf of the Corporation, for collection, checks, notes and other obligations and shall deposit the same to the credit of the Corporation in such bank or banks or depositories as shall be designated in the manner prescribed by the Board; he or she may sign all receipts and vouchers for payments made to the Corporation, either alone or jointly with such other officer as is designated by the Board; he or she shall enter or cause to be entered regularly in the books of the Corporation to be kept by him or her for that purpose full and accurate accounts of all moneys received and paid out on account of the Corporation; he or she shall perform all acts incident to the position of Treasurer subject to the control of the Board; including the monitoring and audit of all cash accounts whose existence must fast be approved by the Board; and he or she shall, if required by the Board, give such bond for the faithful discharge of his or her duties in such form as the Board may require. Section 5. Secretary. The Secretary shall keep the minutes of all meetings of the Board in books provided for that purpose; he or she shall attend to the giving and serving of all notices; in furtherance of the purposes of the Corporation and subject to the limitations contained in the Articles of Incorporation, he or she may sign with the President in the name of the Corporation and/or attest the signatures thereof, all contracts, conveyances, franchises, bonds, deeds, assignments, mortgages, notes and other instruments of the Corporation; he or she shall have charge of the Corporation's books, records, documents and instruments, except the books of account and financial records and securities of which the Treasurer shall have custody and charge, and such other books and papers as the Board may direct, all of which shall at all reasonable times be open to the inspection of any Director upon application at the office of the Corporation during business hours; and, he or she shall in general perform all duties incident to the office of Secretary subject to the control of the Board. Section 6. Compensation Except for Directors, Officers are entitled to receive any such salary or compensation for their duties as approved by the Board. All Officers are entitled to receive reimbursement for their reasonable expenses only in performing their functions in accordance with policies adopted by the Board. Section 7 Officer's Reliance on Consultant Information In the discharge of a duty imposed or power conferred on an officer of the Corporation, the officer may in good faith and with ordinary care rely on information, opinions, reports, or statements, including financial statements and other financial data, concerning the Corporation or another person, that were prepared or presented by: BYLAWS Page 7 A: Feb.3 Byl. (a) one or more other officers or employees of the Corporation, including members of the Board; (b) legal counsel, public accountants, or other persons as to matters the officer reasonably believes are within the person's professional or expert competence; or, (c) an employee of an Owner, Member, Supporter, or Patron. ARTICLE IV FINANCIAL RESPONSIBILITIES Section 1. Audit. Within ninety (90) days of the close of each fiscal year, the Board shall have an annual audit prepared by an independent auditor who is duly licensed or certified as a public accountant in the State of Texas of the financial books and records of the Corporation. Section 2. Capital Spending Authority: The Board may expend funds for capital improvements for the Cultural Facilities as follows: (a) Funds from an Owner or Owners shall be used for the purposes of the Corporation as authorized and directed by the City or Cities. (b) Funds from other sources, such as donations, may be used at the discretion of the Board for capital purposes as long as the uses are consistent with the Owners' direction and are not reasonably expected by the Board to increase the operation and maintenance costs of the Corporation above the limits established in Section 4, below or have a capital cost greater than $100,000. Section 3. Issuance of Debt The Board is authorized to issue short-term debt only. Short-term debt is that amount which is payable in less than one (1) year from date of issuance. Where possible, the amount and purpose of the short tens debt shall be projected by the Corporation in its annual budget to the Owners. The cumulative amount of short term debt in any fiscal year shall not exceed twenty-five percent (25%) of the total operation and maintenance portion of the budget for that fiscal year. Owners shall be given the first opportunity to provide these funds before the Board incurs debt. Section 4. Increase of O&M Costs. In the event any one or more items is added during a fiscal year that would increase or cause the annual operation and maintenance costs to exceed ten percent (10%) above the budgeted amount for that year, the Board must receive prior approval from all Owners prior to making that addition. Section 5. Fiscal Year. The fiscal year of the Corporation shall begin October I of each year. BYLAWS Page 8 A: Feb.3 Bylaws Section 6. Annual Budget. No later than 90 days prior to the beginning of each fiscal year, the Board shall prepare, or cause to be prepared, and approve a budget (the "Budget") for each fiscal year. The Budget must be approved by a three-quarters (3/4) majority vote of the Board. After approval by the Board, the Budget shall be submitted to each Owner for final approval. If the Board fails to approve the Budget, or if the Budget is not approved by each Owner, then during the first three years of this Agreement, the Budget for the prior fiscal year shall be deemed approved. After the third year of the Agreement and if the Budget is not approved by either the Board or all Owners, then the next year's Budget is the greater of: The total amount of the prior year's Budget; or, The average of the annual Budgets for the prior three (3) years. Section 7. Line Item Flexibility. The Board has the authority to shrift operation and maintenance funds from one line item to another. Section 8. Payments. Beginning October 1, Owners shall make their annual payments to the Corporation in quarterly installments each year. Payments shall be made on or before the first business day of each quarter of the fiscal year. Section 9. Reserve Fund. The budget shall provide for a reserve fund for the replacement of scheduled assets. Any unencumbered funds remaining at the end of the fiscal year shall be converted to the reserve fund. Section 10. Other Funds. Other funds, such as charitable donations, may be used by the Board in accordance with the approved budget or if not anticipated in the budget as the Board directs providing the limitation set out in Section 4, above or a capital cost of $100,000 is not exceeded. ARTICLE V INDEMIFICATION OF DIRECTORS AND OFFICERS Section 1. Right to Indemnification. Subject to the limitations and conditions as provided in this Article V and the Articles of Incorporation, each person who was or is made a party or is threatened to be made a party to or is involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative, arbitrative or investigative (hereinafter a "proceeding"), or any appeal in such a proceeding or any inquiry or investigation that could lead to such a proceeding, by reason of the fact that he or she, or a person of whom he or she is the legal representative, is or BYLAWS Page 9 A: Feb.3 Bylaws was a Director or officer of the Corporation or while a Director or officer of the Corporation is or was serving at the request of the Corporation as a director, officer, partner, venturer, proprietor, trustee, employee, agent or similar functionary of another foreign or domestic corporation, partnership, joint venture, sole proprietorship, trust, employee benefit plan or other enterprise shall be indemnified by the Corporation to the fullest extent permitted by the Texas Non -Profit Corporation Act, as the same exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the Corporation to provide broader indemnification rights than said law permitted the Corporation to provide prior to such amendment) against judgments, penalties (including excise and similar taxes and punitive damages), fines, settlement and reasonable expenses (including, without limitation, attorneys' fees) actually incurred by such person in connection with such proceeding, and indemnification under this Article V shall continue as to a person who has ceased to serve in the capacity which initially entitled such person to indemnify hereunder. The rights granted pursuant to this Article V shall be deemed contract rights, and no amendment, modification or repeal of this Article V shall have the effect of limiting or denying any such rights with respect to actions taken or proceedings arising prior to any such amendment, modification or repeal. It is expressly acknowledged that the indemnification provided in this Article V could involve indemnification for negligence or under theories of strict liability. Section Z Advance Payment. The right to indemnification conferred in this Article V shall include the right to be paid in advance or reimbursed by the Corporation the reasonable expenses incurred by a person of the type entitled to be indemnified under Section I who was, is or is threatened to be made a named defendant or respondent in a proceeding in advance of the final disposition of the proceeding and without any determination as to the person's ultimate entitlement to indemnification; provided, however, that the payment of such expenses incurred by any such person in advance of the final disposition of a proceeding, shall be made only upon delivery to the Corporation of a written affirmation by such Director or officer of his or her good faith belief that he or she has met the standard of conduct necessary for indemnification under this Article V and a written undertaking, by or on behalf of such person, to repay all amounts so advanced if it shall ultimately be determined that such indemnified person is not entitled to be indemnified under this Article V or otherwise. Section 3. Indemnification of Employees and Agents. The Corporation, by adoption of a resolution of the Board, may indemnify and advance expenses to an employee or agent of the Corporation to the same extent and subject to the same conditions under which it may indemnify and advance expenses to Directors and officers under this Article V; and the Corporation may indemnify and advance expenses to persons who are not or were not Directors, officers, employees or agents of the Corporation but who are or were serving at the request of the Corporation as a Director, officer, partner, venturer, proprietor, trustee, employee, agent or similar functionary of another foreign or domestic corporation, partnership, joint venture, sole proprietorship, trust, employee benefit plan or other enterprise against any liability asserted against him BYLAWS Page 10 A: Feb.3 Bylaws or her and incurred by him or her in such a capacity or arising out of his or her status as such a person to the same extent that it may indemnify and advance expenses to Directors under this Article V. Section 4. Appearance as a Witness. Notwithstanding any other provision of this Article V, the Corporation may pay or reimburse expenses incurred by a Director or officer in connection with his or her appearance as a witness or other participation in a proceeding involving the Corporation or its business at a time when he or she is not a named defendant or respondent in the proceeding. Section 5. Non -exclusivity of Rights. The right to indemnification and the advancement and payment of expenses conferred in this Article V shall not be exclusive of any other right which a Director or officer or other person indemnified pursuant to Section 3 of this Article V may have or hereafter acquire under any law (common or statutory), provision of the Articles of Incorporation or these Bylaws, agreement, vote of shareholders or disinterested Directors or otherwise. Section 6. Insurance. The Corporation may purchase and maintain insurance, at its expense, to protect itself and any person who is or was serving as a Director, officer, employee or agent of the Corporation or is or was serving at the request of the Corporation as a Director, officer, partner, venturer, proprietor, trustee, employee, agent or similar functionary of another foreign or domestic corporation, partnership, joint venture, proprietorship, employee benefit plan, trust or other enterprise against any expense, liability or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under this Article V. Section 7 Notification Any indemnification of or advance of expenses to a Director or officer in accordance with this Article V shall be reported in writing to the members of the Board with or before the notice of the next regular meeting of the Board and, in any case, within the 12 -month period immediately following the date of the indemnification or advance. Section 8. Savings Clause. If this Article V or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the Corporation shall nevertheless indemnify and hold harmless each Director, officer or any other person indemnified pursuant to this Article V as to costs, charges and expenses (including attorneys' fees), judgments, fines and amounts paid in settlement with respect to any action, suit or proceeding, whether civil, criminal, administrative or investigative, to the full extent permitted by any applicable portion of this Article V that shall not have been invalidated and to the fullest extent permitted by applicable law. BYLAWS Page 11 A: Feb.3 Bylaws ARTICLE VI Executive Director Powers and Duties of the Executive Director. The Executive Director shall be the principal executive officer of the Corporation and, subject to the control of the Board, he or she shall be in general charge of the properties and affairs of the Corporation. The Executive Director has management and control of the properties and operations of the Corporation, including the powers of a general manager. The Executive Director shall be an ex -officio of all Board committees, except the Audit Committee. The Executive Director will be responsible to implement all orders and resolutions of the Board of Directors, and all other powers that are not specifically reserved to the Directors or Owners, will be executed by the Executive Director within the general guidelines and policies of the Board and Owners. The Executive Director shall be responsible for hiring and firing of the employees of the Corporation. All employees hired by the Executive Director shall be terminable at - will and not be provided any term or promise of employment. The Executive Director is authorized to approve all contracts and expenditures that are not greater than $25,000 without Board approval as long as funds are budgeted and are available for the expenditure. ARTICLE VII CODE OF ETHICS Section I. Policy and Purposes. (a) It is the policy of the Corporation that Directors and officers conduct themselves in a manner consistent with sound business and ethical practices; that the public interest always be considered in conducting corporate business; that the appearance of impropriety be avoided to ensure and maintain public confidence in the Corporation; and that the Board establish policies to control and manage the affairs of the Corporation fairly, impartially, and without discrimination. (b) This Code of Ethics has been adopted as part of the Corporation's Bylaws for the following purposes: (a) to encourage high ethical standards in official conduct by Directors and corporate officers; and (b) to establish guidelines for such ethical standards of conduct. Section 2. Conflicts of Interest (a) Abide by State and Criminal Laws for Public Officers. All directors, officers and employees shall abide by the state civil and criminal laws regarding conflict of interest, official misconduct and other regulations and restrictions involving their official duties. BYLAWS Page 12 A: Feb.3 By1m (b) Disclosure and Abstention. It is the intent of these Bylaws, that the Directors, Executive Director and officers shall take all steps to avoid the appearance of impropriety in the conduct of their affairs on behalf of the Corporation. This includes not engaging in any conduct, business that may be deemed to compromise their independent judgment in executing their duties as Corporation officials. In the event that a Director, officer, or Executive Director has any financial or equitable interest, direct or indirect, in a transaction that comes before the Board, or Advisory Committee or the Executive Director, the affected Director or officer, must: (i) disclose that interest in writing and file it with the Board Secretary; and, (ii) refrain from discussing or voting on the same. (c) Restrictions on Executive Director. The Executive Director is precluded from having any financial or equitable interest in any contract, service or acquisition that is subject to his approval or that his subordinates may approve or monitor. (d) Definition of Financial InterestlRelative. The "financial interest" contemplated under (b) and (c) of this Article requires that the affected person who is the Director, officer, or Executive Director or their relative receive an actual financial benefit from the transaction with the Corporation. A relative is a person related within the first degree of consanguinity or affinity to the Director, officer, or Executive Director. A financial or equitable interest does not include the following: (i) An ownership in the entity transacting business with the Corporation where the ownership interest is less than one percent (1%). (ii) Compensation as an employee, officer or director of the entity transacting business with the Corporation where such compensation is not affected by the entity's transaction with the Corporation. (iii) An investment or ownership in a publicly held company in an amount less than TEN THOUSAND DOLLARS ($10,000.00) (iv) An employee of a public entity may serve on the Board. Section 3. Acceptance of Gifts. No Director or officer shall accept any benefit as consideration for any decision, opinion, recommendation, vote or other exercise of discretion in carrying out official acts for the Corporation. No Director or officer shall solicit, accept, or agree to accept any benefit from a person known to be interested in or likely to become interested in any contract, purchase, payment, claim or transaction involving the exercise of the Director's or officer's discretion. As used here, "benefit" does not include: BYLAWS Page 13 A: F6.3 Bylaws (a) a fee prescribed by law to be received by a Director or officer or any other benefit to which the Director or officer is lawfully entitled or for which he gives legitimate consideration in a capacity other than as a Director or officer; (b) a gift or other benefit conferred on an account of kinship or a personal, professional, or business relationship independent of the official status of the Director or officer; (c) an honorarium in consideration for legitimate services rendered above and beyond official duties and responsibilities if: (1) not more than one honorarium is received from the same person in a calendar year; (2) not more than one honorarium is received for the same service; and (3) the value of the honorarium does not exceed $250 exclusive of reimbursement for travel, food, and lodging expenses incurred by the Director or officer in performance of the services. (d) A benefit consisting of food, lodging, transportation, or entertainment accepted as a guest is reported as may be required by law. Section J. Nepotism. No Director or officer shall appoint, or vote for, or confirm the appointment to any office, position, clerkship, employment or duty, of any person related within the second degree by affinity or within the third degree of consanguinity to the Director or officer so appointing, voting or confirming, or to any other Director or officer. This provision shall not prevent the appointment, voting for, or confirmation of any person who shall have been continuously employed in any such office, position, clerkship employment or duty at least thirty (30) days prior to the appointment of the Director or officer so appointing or voting. ARTICLE VIII MISCELLANEOUS PROVISIONS Section 1. Seal. The seal of the Corporation shall be such as may be from time to time approved by the Board. Section 1. Notice and Waiver of Notice. Whenever any notice, other than public notice of a meeting given to comply with the Open Meetings Act, is required to be given under the provisions of these Bylaws, such notice shall be deemed to be sufficient if given by depositing the same in a post office box in a sealed postpaid wrapper addressed to the person entitled thereto at his or her post office address, as it appears on the books of the Corporation, and such notice shall be deemed to have been given on the day of such mailing. If transmitted by facsimile or email, such notice shall be deemed to BYLAWS Page 14 A: Feb.3 Bylaws be delivered upon successful transmission of the facsimile or email. A Director may waive notice of any meeting. The attendance of a Director at any meeting shall constitute a waiver of notice of such meeting unless such attendance is for the purpose of objecting to the failure of notice. A waiver of notice, signed by the person or persons entitled to said notice, whether before or after the time stated therein, shall be deemed equivalent thereto. Section 3. Resignations. Any Director, officer or committee member may resign at any time. Such resignations shall be made in writing and shall take effect at the time specified therein, or, if no time be specified, at the time of its receipt by the President or Secretary. The acceptance of a resignations shall not be necessary to make it effective, unless expressly so provided in the resignation. Section 4. Gender. References herein to the masculine gender shall also refer to the feminine in all appropriate cases and vice versa Section 5. Appropriations and Grants. The Corporation shall have the power to request and accept any appropriations, grant, contribution, donation, or other form of aid from the federal government, the State, any political subdivision, or municipality in the State, or from any other source. Section 6. Reports. No later than ninety (90) days following the end of each fiscal year, the Board shall submit to each Owner the following: (1) Program of Service; (2) Annual Report; and, (3) Annual Audit. Section 7. Use of Corporation's Property and Facilities. The Board shall from time to time develop a formal, written policy (the "Usage Policy') governing the use of the Corporation's property and facilities (collectively, the "Facilities"). The usage policy shall (a) ensure that citizen groups from each Owner are given preferential rights as to the use of the Facilities and (b) establish a fee -for -use structure for the use of the Facilities. The Usage Policy, and any amendment or alteration thereto, must be approved in writing by each Owner. ARTICLE IX AMENDMENTS A proposal to alter, amend or repeal these Bylaws shall be made by the affirmative vote of a majority of the full Board then appointed and serving at any annual or regular meeting, or at any special meeting if notice of the proposed amendment be contained in the notice of said special meeting. However, any proposed change or amendment to the Bylaws must be approved in writing by each Owner to be effective. BYLAWS Page 15 A: Feb. 3 Bylaws CITY APPROVAL OF BYLAWS Resolution No. 2260-2-04(R) approving the form of these Bylaws has been adopted by the City Council of the City of Allen, Texas, on February 24, 2004. Resolution No. 04-02-20(R) approving the form of these Bylaws has been adopted by the City Council of the City of Frisco, Texas, on February 10, 2004. Resolution No. 2004-2-6(R) approving the form of these Bylaws has been adopted by the City Council of the City of Plano, Texas, on February 9, 2004. A:Teb. 3 GTY APPROVAL OF BYLAWSAm Arts of Collin County Vision Statement The Arts of Collin County will create an environment where all citizens can share and enjoy in the full diversity and vitality of the arts. We are committed to: i Supporting and nurturing non-profit art groups, as they are the foundation for the cultivation of arts in our community. ♦ Understanding our users are our customers; we will know their needs and support their success. ♦ Educating in the form of collaboration with teaching institutions and programs offered by the facility. ♦ Providing a facility that is recognized for its distinctive appearance and outstanding functionality as well as its ability to promote the arts. i Recognizing and valuing our citizens as our ultimate customers and shareholders. We will provide opportunities for understanding, education, appreciation of and participation in the arts. EXHIBR (. PAGE /_OF_L