Ord. 0843 05-11-98ORDINANCE NO. 843
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF PEARLAND,
TEXAS, ADOPTING THE DEVELOPMENT AND FINANCING AGREEMENT
AS APPROVED BY THE BOARD OF DIRECTORS OF TAX INCREMENT
REINVESTMENT ZONE NO. 1 ("TIRZ"), CITY OF PEARLAND, TEXAS;
CONTAINING A SEVERABILITY CLAUSE; PROVIDING AN EFFECTIVE
DATE; AND CONTAINING FINDINGS AND PROVISIONS RELATED TO
THE FOREGOING SUBJECT; AND DECLARING AN EMERGENCY
BECAUSE THE NEED TO DEVELOP THE CITY'S INFRASTRUCTURE
INURES TO THE BENEFIT OF THE PUBLIC AND, THEREFORE, BEARS
DIRECTLY UPON THE HEALTH, SAFETY AND WELFARE OF THE
CITIZENRY.
WHEREAS, pursuant to Chapter 311 of the Texas Tax Code and City of
Pearland Ordinance No. 834, the City has designated a contiguous geographic area
within the City limits of Pearland, Texas, as Tax Increment Reinvestment Zone No. 1
and created a board of directors to make recommendations to the City Council
concerning the administration of the zone; and
WHEREAS, pursuant to Section 311.011 of the Texas Tax Code, the
TIRZ Board of Directors prepared and adopted a DEVLOPMENT AND FINANCING
AGREEMENT for the TIRZ, and have submitted such plans to the City Council for its
approval; and
WHEREAS, the DEVELOPMENT AND FINANCING AGREEMENT enables the
development of a quality, single family, in -city, residential community which will act
as a self-sustaining tax base for the City; and
WHEREAS, the DEVELOPMENT AND FINANCING AGREEMENT allows the
developer to advance funds for the improvements to the reinvestment zone and
provides for reimbursement to the developer according to a City Council approved
development and financing agreement between the TIRZ and the developer; now,
therefore,
1
ORDINANCE NO. 843
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS:
Section 1. It is hereby officially found and determined that all of the facts
recited in the preamble hereto are found and declared to be true and correct and the
preamble is incorporated into and made a part of this ordinance.
Section 2. That certain TIRZ Development and Financing Agreement„ a copy
of which is attached hereto as exhibit "A", is incorporated herein for all purposes, and
is hereby authorized and approved.
Section 3. Declaration of Emergency. The City Council finds and determines
that the need to develop the City's infrastructure bears directly upon the health,
safety, and welfare of the citizenry; and that this Ordinance shall be adopted as an
emergency measure, and that the rule requiring this Ordinance to be read on two (2)
separate occasions be, and the same is hereby waived.
Section 4. Severability. If any section, subsection, sentence, clause, phrase
or portion of this Ordinance is for any reason held invalid, unconstitutional or
otherwise unenforceable by any court of competent jurisdiction, such portion shall be
deemed a separate, distinct, and independent provision and such holding shall not
affect the validity of the remaining portions thereof.
Section 5. Effective Date. This Ordinance shall become effective immediately
upon its passage and approval by the City Council.
2
ORDINANCE NO. 843
PASSED and APPROVED on First and Only Reading this the 11th day of
May
ATTEST:
, A.D., 1998.
APPROVED AS TO FORM:
DARRIN M. COKER
INTERIM CITY ATTORNEY
TOM REID
MAYOR
3
r
EXHIBIT
DEVELOPMENT AND FINANCING AGREEMENT
By and Between
THE CITY OK PEARLAND, TEXAS
REINVESTMENT ZONE NUMBER ONE,
CITY OF PEARLAND, TEXAS.
and
BEAZER HOMES TEXAS, L.P.
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DEVELOPMENT AND FINANCING AGREEMENT
L
Table of Contents
Page
RECITALS 1
AGREEMENT 2
ARTICLE 1 GENERAL TERMS 2
1.1 Definitions 2
1.2 Singular and Plural 3
ARTICLE 2 DELEGATION OF POWERS AND. DUTIES TO THE ZONE BOARD 3
2.1 Delegation of Powers 3
ARTICLE 3 DUTIES OF THE ZONE 4
3.1 Efforts Required w 4
3.2 Plans and Specifications Approval 4
3.3 Construction Contract Award 4
3.4 Use of Property 5
3.5 Evidence of Title 5
3.6 Payments to the Developer 5
ARTICLE 4 DUTIES AND RESPONSIBILITIES OF TH E DEVELOPER 5
4.1 Selection and Retention of Consultants, Design of the Project 5
4.2 Payments to Contractors, Vendors and Consultants 5
4.3 , Award of Construction Contract 6
4.4 Change Orders 6
4.5 Approval of the City Manager 6
4.6 Reimbursement of Expenditures 6
4.7 Participation of Disadvantaged Businesses 7
ARTICLE 5 OBLIGATIONS OF THE CITY 7
5.1 Tax Increment Fund 7
5.2 Collection of Tax -Increments from Certain Taxing Units 7
5.3 Collection of the City's Tax Increments 7
5.4 Amount and Terms of Loan by Developer 7
5.5 Certificate of Indebtedness 7
5.6 Use of Loan Proceeds 7
5.7 . Procedure for Borrowing 8
5.8 Interest Rate and Payment States 8
5.9 Option Prepayments 8
5.10 Payment of the Loan 9
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Table of Contents
continued
Page
5.11 Special Obligations 9
5.12 Acceptance of Property and Facilities 10
ARTICLE 6 PROJECT MANAGER 10
6.1 General Powers 10
6.2 Designation 10
ARTICLE 7 INSURANCE AND INDEMNITY 10
7.1 10
ARTICLE 8 MISCELLANEOUS 10
8.1 Personal Liability of Public ,officials 10
8.2 Liability of Beazer Homes, Texas, L.P., its Successors and Assignees 10
8.3 Notices 11
8.4 Amendments and Waivers 12
8.5 Invalidity 12
8.6 Successors and Assigns 12
8.7 Exhibits, Titles of Articles, Sections and Subsections 12
8.8 Applicable Law 12
8.9 Entire Agreement 12
8.10 Term 13
8.1.1 Approval by the Parties 13
Exhibit A - Certificate of Indebtedness 15
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DEVELOPMENT AND FINANCING AGREEMENT
This Development and Financing Agreement ("Agreement') is made by and between the
CITY OF PEARLAND, TEXAS ("City"), a municipal corporation and home -rule city of the
State of Texas, situated in Brazoria County, -Texas, acting by and through its governing body, the
City Council; REINVESTMENT ZONE NUMBER ONE, CITY OF PEARLAND TEXAS,a
reinvestment zone created by the City of Pearland pursuant to Chapter 311 of the Texas Tax
Code, as amended, acting by and through its governing body, the Board of Directors (the
"Zone"); and BEAZER HOMES TEXAS, L.P., a Texas limited partnership ("Developer").
RECITALS
Pursuant to Chapter 311 of the Texas Tax Code, as amended, ("the Act") the City Council
of the City created the Zone in the City of Pearland, by Ordinance No. 834, established the
number of members of the Board of Directors as nine (9) and appointed five (5) Board members.
The State Senator has appointed his designee, the State Representative who has jurisdiction over
the Property encompassing the Zone will appoint one (1) Board Member to the Board and the
City will appoint the remaining two (2) members. The City has agreed to deposit incremental tax
collections from the Zone into the Tax Increment Fund created by Ordinance 834.
The Board of Directors of the Zone adopted a final Project Plan and Reinvestment Zone
Financing Plan on April 20, 1998, which provides that the Zone will undertake to make
improvements in the Zone pursuant to the Project Plan and Reinvestment Zone Financing Plan
(the "Plan'). Under the Plan, the improvements constituting the "Project" (hereinafter defined)
are estimated to cost in excess of $5,039,799, plus administrative and financing costs. Of the
total Project Costs, $2,099,375 plus administrative and financing costs are to be paid by payments
from the City into the Tax Increment Fund.
The Board of the Zone submitted the Plan to the City Council of the City for approval,
and on 1,27 . , 1998, the City Council approved the Plan.
The Developer has agreed to initially fund the cost of the Project and the operating costs
of the Zone, provided that such costs are first submitted to it for approval and further that it be
reimbursed for such costs as provided in this Agreement.
The Act provides that the Board of Directors of the Zone may enter into agreements as
it considers necessary or convenient to implement the Plan and to achieve its purposes, and
further provides that the City Council may by ordinance delegate to the Board of Directors of the
Zone any powers and duties relating to the implementation of the Plan that the City Council
considers advisable. The City Council considers it advisable to delegate to the Board of Directors
certain powers and duties relating to the Plan as provided by this Agreement.
The City Council and the Board of Directors of the Zone have determined that it is in the
best interest of the Zone and the City for the Zone to contract with and to authorize the
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Developer to contract with a Project Manager (hereinafter defined) and certain consultants and
City staff to provide for the efficient and effective implementation of the Plan.
AGREEMENT
For and in consideration of the mutual promises, covenants, obligations, and benefits of
this Agreement, the City, the Zone and the Developer contract and agree as follows:
ARTICLE 1
GENERAL TERMS
1.1 Definitions. The terms "Act," "Agreement," "City," "Developer," and "Zone" have
the above stated meanings, and the following terms have the following meanings:
"Administration Expenses" means all expenses reasonable and necessary for the creation,
maintenance, operation and administration of the Reinvestment Zone Number One, City of
Pearland, Texas ("TIRZ"), its Property and Project, including, without limitation, expenses for
the services of auditors, accountants, financial advisors, attorneys, engineers, Project Managers
and other consultants, and including (i) the City's costs, if any, of collecting the Tax Increments
and (ii) the City's imputed administrative costs associated with the TIRZ, including reasonable
charges, but not to exceed $25,000 per year, for time spent by employees of the City in
connection with the implementation of the Plan.
"Business Day" means a day other than a Saturday, Sunday or legal holiday in the State
of Texas or the City.
"City Attorney" means the City Attorney of the City or his or her designee.
"City Council" means the City Council of the City.
"City Manager" means the City Manager of the City or his or her designee.
"Developer" means Beazer Homes Texas, L.P., the sole landowner within the Zone or
the authorized representative of Beazer Homes Texas, L.P. and which representative until further
notice to the City, by the Developer shall be Dan Olson.
"Person" means any individual, corporation, partnership, joint venture, joint stock
company, trust, unincorporated organization, government or any agency or political subdivision
thereof, or any other form of entity.
"Project" means any of the acquisition, design, construction, assembly, installation,
implementation and financing costs ofone or more of the projects and activities included in the
Plan for the Zone approved by the City, including associated costs such as financing costs,
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Project Managers, engineering, legal and other consultant fees and expenses related to the Project
and also including the administration and other operating costs of the Zone.
"Project Manager" means the agent of the Developer for carrying out the responsibilities
enumerated in Article 6 hereof and other responsibilities delegated by the Developer.
"Project Plan and Financing Plan" or "Plan" means the Zone Project Plan and
Reinvestment Zone Financing Plan, as adopted by the Zone Board and approved by the City
Council on 4or /2 7 , 1998. Such Plan shall not include any amendments to the Project
Plan and Financing Plan due to land added to the Zone unless this Agreement is specifically
amended in accordance with the terms of this Agreement. Any amendment to the Plan shall not
adversely affect or impair any of Developer's rights under the initial Plan.
"Tax Increment" means the incremental tax collections by the City from increases in
taxable value on property within the Zone from the Tax Increment Base, as of January 1, 1997,
the year in which the Zone was created, all as specified by Section 311.013 of the Act.
"Zone Board" means the Board of Directors of Reinvestment Zone Number One, City of
Pearland, Texas.
1.2 Singular and Plural. Words used herein in the singular, where the context so
permits, also include the plural and vice versa. The definitions of words in the singular herein
also apply to such words when used in the plural where the context so permits and vice versa.
- ARTICLE 2
DELEGATION OF POWERS AND DUTIES
TO THE ZONE BOARD
2.1 Delegation of Powers. Subject to the provisions of Article IV hereof, the City
hereby acknowledges the Zone's authority pursuant to the Act to enter into such agreements as
the Zone Board considers necessary or convenient to implement the Plan and to achieve its
purposes. Subject to the provisions of Article IV hereof, the City hereby delegates to the Zone
Board all powers and associated duties necessary and convenient to the effective and efficient
implementation of the Plan, including without limitation (i) the power to select and retain one
or more Project Managers to assist in the implementation of the Plan or to contract with the
Developer to do so; (ii) the power to select and retain other consultants, including without
limitation, attorneys and administrators, including contracting with the City for the use of City
employees in order to assist in the implementation of the Plan and to contract with the Developer
and to authorize it to perform those tasks; and (iii) the power to approve plans and specifications,
award contracts, and approve change orders and payments in accordance with this Agreement,
provided, however, that nothing in this Section or Agreement shall be construed to delegate to
the Zone Board the power to levy taxes, issue bonds, or condemn property. The City also
authorizes the use of its staff pursuant to the direction of the Zone Board (except where such
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direction may conflict with the City charter, directives of the City Council or policies of the City)
to operate the Zone and to implement the Plan.
ARTICLE 3
DUTIES OF THE ZONE
3.1 Efforts Required. The Zone will use reasonable efforts to implement the Plan,
causing each part of the Project to be acquired and installed in accordance with this Agreement.
3.2 Plans and Specifications. Approval.
(a) Subject to the provisions of Article IV hereof, the Developer will submit
plans and specifications (the "Specifications") for all construction proposed by the Developer to
the Zone Administrator. Upon receipt of the Specifications, the Zone Administrator will
promptly distribute a set to each member of the Zone Board and will call a meeting of the Zone
Board within 15 days after distribution, if such a meeting is not already scheduled within such
time period. The Zone Board will review plans and specifications for all construction proposed
by the Developer and will either approve such plans and specifications within 30 days of the date
that the Specifications were delivered to the Zone Administrator, and if disapproved will indicate
in writing any deficiencies found in such Specifications within such period. The Zone may only
reject Specifications with deficiencies which consists of specifications for a project which are not
included in the Plan (or is reasonably necessary to carry out the intent of the Plan) or
specifications not designed in accordance with applicable City or other applicable regulations or
sound professional practices. If the Specifications are not approved or deemed approved, the
Developer shall correct any deficiencies identified by the Zone Board which Specifications shall
be resubmitted as above provided, and either be approved or noted for deficiencies within an
additional 30-day period. Such process shall be repeated until the Specifications are acceptable
to the Zone Board or until the Zone Board fails to comment in writing on the Specifications
within 30 days of the date of submittal, in which case such Specifications shall be deemed
approved.
(b) The Developer will also submit a copy of the Specifications to the City
Manager. The City will review the Specifications for all construction proposed by the Developer
and will either approve or disapprove them within 30 days of receipt, and if disapproved, will
indicate in writing any deficiencies found in such Specifications within such period. If the
Specifications are not approved or deemed approved by the City, the Developer shall correct any
deficiencies identified by the City, which revised Specifications shall be resubmitted, as above
provided, and either be approved or noted for deficiencies within an additional 30 days period.
Such process shall be repeated until the Specifications are acceptable to the City or until the City
fails to comment in writing within 30 days after date of submittal, in which case such
Specifications shall be deemed approved.
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4.2 Payments to Contractors, Vendors and Consultants. The Developer hereby agrees
to promptly advance sufficient funds to the Zone, or to pay funds on behalf of the Zone, in
accordance with this Agreement and as such funds become due for all Projects, including without
limitation, all costs of design, engineering, materials, labor, construction, inspection, easements,
legal, consulting fees, the cost of Project
connection with any of the Projects; all paym
part of any of the Projects; all costs incu
approvals, certificates or permits required as a
and all out-of-pocket expenses incurred in
Developer shall not be obligated to advance f
is not being financed pursuant to this Agreeme
writing in, advance by the Developer as pro
Manager either a copy of each check which
together with a copy of each invoice or sta
reasonably acceptable to the City setting fort
4.3 Award of Construction Contra
review of all contract and bid documents,re
recommendations to the Zone. Prior to auth
shall submit all contract and bid documents to
of this Agreement. Upon authorization of the
advertise for, review and tabulate bids. The De
all policies of the City, as they may be in of
separate contracts pursuant to the recommendat
Zone. The Developer shall make a recommen
to the lowest responsible bidder. The Zone sh
to the lowest responsible bidder, subject to th
4.4 Change Orders. The Develope
orders related to the Project, and will make
change orders shall be presented to the City
Agreement prior to approval by the Zone.
4.5 A
royal of the Cit
Mana • e
specifications, construction contracts, bid docu
approval, conditional approval, or disapprov
manner and sequence provided by this Article.
provide written approval, conditional approv
plans and specifications within ten (10) Busines
Manager shall provide to the Developer writ
of all construction contracts, bid documents
from receipt of such documents. Any conditi
shall be accompanied by a written statemen
disapproval, and the Developer shall be entitle
30168178.5 42898 1407C 97380786
anagers and other consultant's costs arising in
nts arising under any contracts entered into as a
ed in connection with obtaining governmental
art of any of the Projects; all related legal fees;
connection therewith. Provided, however, the
nds pursuant to this Section for any Project that
t or for any contract or expense not approved in
ided herein. Developer will furnish to the City
is delivered in accordance with this Agreement,
ement which was paid, or other documentation
the information.
t. The Developer shall be responsible for the
ated to the Project, and shall make appropriate
rizing the advertisement for bids, the Developer
he City Manager in accordance with Section 4.5
Zone and the City Manager, the Developer shall
eloper shall bid all contracts in compliance with
ect from time to time. A Project may be bid in
on of the Developer and the authorization of the
ation to the Zone regarding the award of the -bid
11 approve the award of the construction contract
approval of the City Manager.
shall be responsible for the review of all change
appropriate recommendations to the Zone. All
Manager in accordance with Section 4.5 of this
1.
The Developer shall submit all designs, plans,
ents and change orders to the City Manager for
Such submissions shall be made in the time,
The City Manager will use reasonable efforts to
1 or disapproval to the Developer of all designs,
Days from receipt of such documents. The City
en approval, conditional approval, or disapproval
nd change orders within ten (10) Business Days
nal approval or disapproval by the City Manager
of the reasons for such conditional approval or
to resubmit the documents for approval pursuant
to this Section. If the City Manager fails to provide written approval or disapproval of
construction contracts, bid documents and change orders within ten (10) Business Days of receipt
of such documents as provided by this Section, the City Manager will be deemed to have
approved the submission.
4.6 Reimbursement of Expenditures. The Developer will be reimbursed for advances
made pursuant to Section 4.2 of this Agreement by the Zone out of the Tax Increment Fund in
accordance with this Agreement. The Developer reserves the right to make expenditures for
projects not included in the Plan or not approved in accordance with this Agreement; provided,
however, that such .expenditures are not required to be reimbursed by the City or the Zone unless
specifically agreed to by any such party. It is specifically recognized that the City, or others may
request the Zone and/or the Developer to construct facilities that are not part of the Plan and
nothing in this Agreement shall prohibit any of such parties agreeing whereby the Developer
would make advances for construction and the City, or others would make payments from funds
of any such entity not committed by this Agreement.
4.7 Participation of Disadvantaged Businesses. The Board shall comply with all laws
applicable to the participation of disadvantaged businesses in the Zone, including Section
311.0101 of the Act.
ARTICLE 5
OBLIGATIONS OF THE CITY
5.1 Tax Increment Fund. The City hereby covenants and agrees that it will maintain
the Tax Increment Fund created by Ordinance No. 834 as a separate fund including subaccounts
if necessary in the City's Treasury and into which the Tax Increment shall be deposited by the
participating taxing units during the term of this Agreement.
5.2 Collection of Tax Increments from Certain Taxing Units. To the extent the City
may legally do so, the City covenants and agrees that it will not permit a reduction, abatement,
or exemption in the Tax Increment paid by City until the Developer's advances to the Zone have
been paid in full, legally defeased, or all payments have been made as provided in this
Agreement.
5.3 Collection of the City's Tax Increments. The City will use good and sound
practices pursuant to the City's policies and standard practices to collect its Tax Increments and
to pay the Tax Increments collected into the Tax Increment Fund.
5.4 Amount and Terms of Loan By Developer. Subject to the terms and conditions
hereof, Developer agrees to advance to The City and the Zone an aggregate principal amount not
to exceed two million ninety-nine thousand three hundred seventy-five dollars ($2,099,375.00)
to be repaid by the City and the Zone from the Tax Increments.
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5.5 Reimbursement to Developer. The amount to be advanced by Developer pursuant
to this Agreement shall be reimbursed to Developer pursuant to this Agreement together with
interest thereon as herein provided. The obligation to Developer (the "Reimbursement
Agreement") shall bear interest as provided in Section 5.8 of this Agreement. Principal and
interest on this Reimbursement Agreement shall be payable on the dates specified in Section 5.8
of this Agreement.
5.6 Use of Loan Proceeds. The amounts advanced by Developer pursuant to this
Agreement shall be used for the purposes of financing Project Costs in accordance with this
Agreement. Such advanced proceeds may not be used to finance Projects not included in the
Plan.
5.7 Procedure for Advances Any payments or advances made by Developer on
behalf of the Zone or the City prior to the date hereof to the extent included in the Plan shall be
approved by the process provided in Article IV of this Agreement and shall be reimbursed to
Developer from the Tax Increments as provided herein.
5.8 Interest Rate and Payment Dates.
(a) The total amounts owing or to become owing from time to time under the
Reimbursement Agreement shall bear interest commencing on July 1, 2000, until December 31,
2003 or until the conditions hereafter set forth in this paragraph are met, whichever is later, at
the rate of 5.75% per annum. At such time as the ad valorem assessed value of all property in
the Zone, as certified by the Brazoria County Appraisal District, generates incremental revenue
sufficient to support an obligation with a term not to exceed twenty (20) years, bearing interest
at the then current interest rate for comparable issues, not to exceed 5.75%, with a debt coverage
of not less than 1.5, the interest rate from and after such date, shall be the Prime Rate, as
reflected in the Wall Street Journal, as the same may vary from time to time, but in no event less
than 5.75% per annum. Said interest rate shall continue to accrue until the full amount owing
on the Reimbursement Agreement, principal and interest, is paid in full. If the Prime Rate should
cease to be published, the parties hereto shall agree upon a substitute index which produces a
similar rate. The Zone and the City shall begin reimbursing the Developer once the Project
Improvements have been substantially completed. Payment shall be made beginning on the first
February 15 following substantial completion of the Project Improvements, and subsequent
payments shall be made on the first Business Day of every third calendar month thereafter, in the
amount of the ad valorem taxes generated by the Zone during the prior year, to the extent
collected, less Administrative Expenses actually incurred during such period. The Reimbursement
Agreement, if not previously paid in full, shall mature twenty (20) years from the date hereof or
on the date the Zone ceases to exist, whichever is earlier. However, notwithstanding the
termination of the Zone, such payments shall continue to be made to the Developer until the
Developer has been repaid in full, including interest as provided herein, through such payments
and/or the repayment made as hereafter provided.
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(b) The City, by the execution of this Agreement, agrees to sell debt in the
form of bonds, notes or other evidence of indebtedness which it may select, not to exceed a.
maximum term of twenty (20) years (the "Obligation"), to reimburse the Developer in the full
amount of $2,099,375.00, plus interest as herein provided, at such time as the ad valorem
assessed value for all property within the Zone, as certified by the Brazoria County Appraisal
District, generates incremental revenue sufficient to support such Obligation bearing interest at
the then current rate of interest for comparable issues, not to exceed 5.75%, with a debt coverage
of not less than 1.5. Such Obligation shall be issued prior to June 1 of the year following the
year in which such debt coverage requirement is satisfied.
(c) In the event the City fails to pay the full amount due to Developer, plus
accrued interest on .the Reimbursement Agreement, at the time the conditions set forth in
subparagraph (b) above are met, then all amounts remaining due and owing to Developer
pursuant to this Agreement and the Reimbursement Agreement shall begin accruing interest from
and after such date at the Prime Rate, as reflected in the Wall Street Journal, as the same may
vary from time to time, but in no event less than 5.75% per annum. Such interest rate shall
continue until the full amount due to Developer under the Reimbursement Agreement is paid in
full.
5.9 Optional Prepayments.
A. Borrower may at any time and from time to time prepay the balance owing
on the Reimbursement Agreement, in whole or in part, without premium or penalty, upon at least
one Business Day's notice to Lender, specifying the date and amount of prepayment. If the
prepayment notice is given, the prepayment amount specified in such notice shall be due and
payable on the date specified therein, together with accrued interest to such date on the amount
prepaid. No partial prepayment shall be less than $100,000.00 or a whole multiple of
$100,000.00 in excess thereof.
B. In the event Borrower prepays all amounts then outstanding on the
Reimbursement Agreement, including principal and interest, Borrower may terminate this
Agreement upon notification to Lender.
C. Amounts prepaid on account of the Loan may not be reborrowed.
5.10 Payment of the Loan. The Reimbursement Agreement to Developer, including
both the principal thereof and the interest thereon, is hereby made payable from the Tax
Increment Fund to the payment of its obligations to Developer pursuant to the terms of this
Agreement subject to the City's rights under this Section 5.10. The City and the Zone are not
required to repay amounts due and owing under this Agreement with tax increments attributable
to land added to the Zone after the date of this Agreement unless the City, the Zone and
Developer agree and modify the Agreement in accordance with this Agreement.
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The Developer's right to payment from the Tax Increment Fund granted in herein
is subject only to (i) the rights of the City to retain, use and/or expend tax increments pursuant.
to the preceding paragraph; and (ii) the rights of any of the holders of bonds, notes or other
obligations that have been heretofore or are hereafter issued by a taxing unit that are payable
from and secured by a general levy of ad valorem taxes throughout the taxing unit. Provided,
however that the City agrees it will use other monies legally available to pay the holders of
bonds, notes or other obligations issued on or to be issued by the City as described in (ii) of this
section before using the Tax Increment Fund to pay such obligations including City
reimbursables.
The obligation of the City to repay the Developer as set forth in this Agreement
from the Tax Increment Fund shall be absolute and unconditional, and until such time as this
Agreement and the other contractual obligations due to Developer pursuant to this Agreement
have been fully paid or provision for payment thereof have been made in accordance with these
terms. City's failure to make a payment to Developer (whether principal, interest or other
amounts) when due, from moneys available in the Tax Increment Fund, which failure continues
for ten (10) business days after receipt of written notice by Developer of such failure, shall
constitute an event of default ("Event of Default"). Upon an Event of Default and so long as
Developer is not in default in the performance of any of its duties, liabilities or obligations arising
out of or connected with this Agreement, Developer will be entitled to any remedies provided by
law, may accelerate the unpaid balance of the Reimbursement Agreement, and may at law or in
equity, by suit, mandamus, action or any other proceeding enforce and compel performance of
all duties required to be performed by City under this Agreement.
5.5 Special Obligations. This Agreement is a special obligation of City payable solely
from the Tax Increment Fund, as and to the extent provided in this Agreement. This Agreement
does not give rise to a charge against the general credit or taxing powers of the City or any other
taxing unit and is not payable except as provided in the Act and in this Agreement. Developer,
its successors and assigns shall never have the right to demand payment thereof out of any funds
of the City other than the Tax Increment Fund.
5.6 Acceptance of Property and Facilities. The City agrees to accept title to, to
maintain, operate, repair and to extend where reasonably required to service the property in the
Zone, when the construction specified in the Plan has been completed, any property or facilities
proposed to be dedicated hereunder by the Zone or the Developer to the City.
ARTICLE 6
PROJECT MANAGER
6.1 General Powers. The Developer's authorized agent, Dan Olson, shall act as Project
Manager and shall act as an agent of the Zone and shall be responsible for the supervision and
inspection of the acquisition, design, construction, assembly, installation and implementation of
one or more Projects or phases thereof, as designated by the Zone in accordance with this
Agreement. The grant of specific powers, duties and responsibilities to a Project Manager
30168178.5 42898 1407C 97380786
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pursuant to this Agreement shall not be construed to limit the general powers granted by this
Section to the Developer to hire and utilize Project Managers.
6.2 Designation. The Developer may change its designation of a Project Manager for
any Project at any time upon written notification to the Zone and the City and subject to the
approval of the City Manager, whose approval shall not be unreasonably be withheld.
ARTICLE 7
INSURANCE AND INDEMNITY
7.1 The Zone shall require all contractors to provide such indemnities to the Zone and
the City and to secure and maintain insurance as would be required for similar city contracts,
pursuant to applicable city ordinances or policies.
ARTICLE 8
MISCELLANEOUS
8.1 Personal Liability of Public Officials. To the extent permitted by State law, no
public official shall be personally responsible for any liability arising under or growing out of the
Agreement.
8.2 Liability of Beazer Homes Texas, L.P., its Successors and Assignees. Any
obligation or liability of Beazer Homes Texas, L.P. whatsoever which may arise at anytime under
this Agreement or any obligation or liability which may be incurred by Beazer Homes Texas,
L.P. pursuant to any other instrument, transaction or undertaking contemplated hereby shall be
satisfied, if at all, out of the assets of Beazer Homes Texas, L.P. only. No obligation or liability
shall be personally binding upon, nor shall resort for the enforcement thereof be had to, the
property of any of partners, officers, employees, shareholders or agents of Beazer Homes Texas,
L.P., regardless of whether such obligation or liability is in the nature of contract, tort or
otherwise.
8.3 Notices. Any notice sent under this Agreement (except as otherwise expressly
required) shall be written and mailed, or sent by rapid transmission confirmed by mailing written
confirmation at substantially the same time as such rapid transmission, or personally delivered
to an officer of the receiving party at the following addresses:
THE CITYBORROWER:
30168178.5 42898 1407C 97380786
City Manager
City of Pearland
Pearland, Texas
RE: REINVESTMENT ZONE NUMBER ONE
11
THE ZONE BORROWER:
LENDER:
with a copy to:
City Attorney
City of Pearland
3519 Liberty Drive
Pearland, Texas 77581
RE: REINVESTMENT ZONE NUMBER ONE
Reinvestment Zone Number One,
City of Pearland, Texas
Patricia D. Knudson & Associates, Zone
Administrator
8588 Katy Freeway, Suite 441
Houston, Texas 77024
with a copy to:
.M. Marvin Katz
Mayer, Brown & Platt
700 Louisiana, Suite 3600
Houston, Texas 77002
Beazer Homes Texas, L.P.
10235 West Little York, Suite 167
Houston, Texas 77040
Each party may change its address by written notice in accordance with this Section, Any
communication addressed and mailed in accordance with this Section shall be deemed to be given
when so mailed, any notice so sent by rapid transmission shall be deemed to be given when
receipt of such transmission is acknowledged, and any communication so delivered in person shall
be deemed to be given when receipted for by, or actually received by, an authorized officer of
the City, Zone or Developer, as the case may be.
8.4 Amendments and Waivers. Any provision of this Agreement may be amended or
waived if such amendment or waiver is in writing and is signed by the City, the Zone and the
Developer. No course of dealing on the part of the City, the Zone or the Developer nor any
failure or delay by the City, the Zone or the Developer with respect to exercising any right,
power or privilege pursuant to the Agreement shall operate as a waiver thereof, except as
otherwise provided in this Section.
8.5 Invalidity. In the event that any of the provisions contained in this Agreement
shall be held unenforceable in any respect, such unenforceability shall not affect any other
provisions of this Agreement.
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8.6 Successors and Assigns. No party to this Agreement shall have the right to assign
its rights under this Agreement or any interest herein, without the prior written consent of the
other parties, except that the Developer may assign its rights and responsibilities hereunder to any
entity to which substantially all of its assets and its rights to proceed with development of the
property within the Zone are transferred.
8.7 Exhibits, Titles of Articles, Sections and Subsections. The exhibits attached to this
Agreement are incorporated herein and shall be considered a part of this Agreement for the
purposes stated herein, except that in the event of any conflict between any of the provisions of
such exhibits and the provisions of this Agreement, the provisions of this Agreement shall prevail.
All titles or headings are only for the convenience of the parties and shall not be construed to
have any effect or meaning as to the agreement between the parties hereto. Any reference herein
to a Section or Subsection shall be considered a reference to such Section or Subsection of this
Agreement unless otherwise stated. Any reference herein to an exhibit shall be considered a
reference to the applicable exhibit attached hereto unless otherwise stated.
8.8 Applicable Law. This Agreement is a contract made under and shall, be construed
in accordance with and governed by the laws of the United States of America and the State of
Texas, as such laws are now in effect.
8.9 Entire Agreement. THIS WRITTEN AGREEMENT REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS
OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
8.10 Term. This Agreement shall terminate on the date on which the City dissolves the
Zone or when it expires by its own terms. Notwithstanding such termination, any unpaid
amounts owing to Developer shall continue to be paid in accordance with the terms hereof until
paid in full.
8.11 Approval by the Parties. Whenever this Agreement requires or permits approval
or consent to be hereafter given by any of the parties, the parties agree that such approval or
consent shall not be unreasonably withheld or delayed.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be duly
executed as of the /j/'4 day of %ay , 1998.
THE CITY OF PEAL ND, TEXAS
(,)1")1,2
Mayor
30168178.5 42898 I407C 97380786
13
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City Managertem,26-1->
Date Countersigned: /..21h /a
•
APPROVED AS TO FORM:
J1
City Attorney
Date: /a.
REINVESTMENT ZONE NUMBER ONE OF
THE CITY OF PEARLAND, TEXAS
By:
C\JQ
Name: V1 &t 14eA
Title:, (1
COUNTERSIGNED:.
By:
Name: C)r\
Title: v
BEAZER HOMES TEXAS, L.P.
By: 694
Name )z.O•� C
Title: e'N's . c i 1-,0 1 me „.k
30168178.5 42898 1407C 97380786
14
(c) When the Specifications have been approved or deemed approved by both
the Zone Board and the City, the Specifications shall be final and the Developer may proceed
pursuant thereto.
3.3 Construction Contract Award. The Zone or the Developer on behalf of the Zone
will advertise for and the Zone will award contracts in accordance with applicable statutory, city
charter and department policies of the City. The Zone Board will require the Developer to cause
construction to be inspected by an engineer or other professional approved by the City Manager
and will require the Developer to require the engineer or other professional to issue a completion
certificate in the form normally utilized by the engineer or other professional performing the
inspection. The Zone Board will require the Developer to use reasonable efforts to cause any
contractor to correct construction deficiencies brought to its attention by the engineers or other
professionals, though neither the Zone Board nor the Developer will warrant the Project or work
performed under any such contract or by the engineer or other professional.
3.4 Use of Property. All personal property to be incorporated into the Project, and all
consumables (other than machinery and equipment) purchased in connection with and to be used
solely for the Project will become property of the City as delivered to the job site and before
incorporation into the realty. All other portions of the Project will become property of the City
as constructed and installed, free and clear of any lien in favor of the Zone, the Developer or any
contractor.
3.5 Evidence of Title. The Zone agrees to execute such additional evidence of transfer
of title as may be required by the City and also, if requested by the City prior to the execution
of a contract with the Developer or any contractor for construction of any part of the Project, to
require any such parties to execute any such additional evidence of ownership as may reasonably
be requested by the City.
3.6 Payments to the Developer. The Zone agrees to pay the Developer for the costs
of the Project advanced by the Developer from funds received from the Tax Increment Fund in
accordance with the terms hereof provided the approval procedure specified herein for plans and
specifications is followed by the Developer.
ARTICLE 4
DUTIES AND RESPONSIBILITIES OF THE DEVELOPER
4.1 Selection and Retention of Consultants, Design of the Project. The Developer shall
select and retain all consultants on behalf of the Zone including but not limited to engineers,
architects, landscape architects, land planners. The consultants under the direction of the
Developer shall prepare all plans and specifications, including all investigatory work and materials
acquisition for the Project. The Developer shall review such plans and specifications and then
shall submit them to the Zone Board and to the City Manager for approval as provided in Section
3.2. The Developer may elect to construct the Project in stages, as determined by the Developer.
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