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2008-08-25 RTIRZ-2008-02RESOLUTION NO. RTIRZ-2008-02 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE PEARLAND TAX INCREMENT REINVESTMENT ZONE NUMBER TWO (TIRZ #2) APPROVING RECOMMENDATION FOR REIMBURSEMENT (LETTER FINANCING AGREEMENT (LFA)NOS. 06-10-001 and 07-03-002) WHEREAS, Reinvestment Zone Number Two, City of Pearland, Texas (the "Zone") has been legally created by the City of Pearland, Texas (the "City"), pursuant to Chapter 311, Texas Tax Code; and WHEREAS, the City and Zone have approved the Zone's Project Plan and Reinvestment Zone Financing Plan, and amendments (the "Plan"); and WHEREAS, the City, the Zone and Shadow Creek Retail, LP entered into a Developer Reimbursement Agreement as of November 13, 2006, in order to implement a portion of the Plan and facilitate the development of the public improvements related to the project and described in the Plan and to provide reimbursement to Shadow Creek Retail, LP for costs and expenditures related to such improvements recommended for approval by the Board of Directors of the Zone (the "Board of Directors") from the Zone's engineer (the "Zone Engineer"), the Zone's auditor (the "Zone Auditor") and the consultants or City staff administering the affairs of the Zone (the "Zone Administrator"); and WHEREAS, the Shadow Creek Retail, LP and the Zone entered into two Letter Financing Agreements, dated March 12, 2007 and October 23, 2006 (collectively the "Letter Agreements") in which the Board of Directors approved construction of the specific TIRZ improvements described in the Letter Agreements and established a budget related to reimbursement (the "TIRZ Improvements"); and WHEREAS, the Shadow Creek Retail, LP has applied to the Zone (the "Application"), for reimbursement of Shadow Creek Retail, LP's costs and expenditures, plus interest, incurred in developing the TIRZ Improvements as described in and contemplated by the Letter Agreements; and WHEREAS, in response to the Shadow Creek Retail, LP's Application, the Zone Engineer, the Zone Auditor and the Zone Administrator have reviewed the Application and the TIRZ Improvements and have certified that the TIRZ Improvements are complete and are in order for reimbursement in accordance with the Application (the "Reimbursement"); and WHEREAS, the Zone Engineer's letters regarding the TIRZ Improvements are attached hereto and incorporated herein as Exhibit "A" (the "Engineer's Report"); and WHEREAS, the Zone Auditor's letter regarding the TIRZ Improvements is attached hereto and incorporated herein as Exhibit "B" (the "Auditor's Report"); and a~~iaz moors-oz.do~ WHEREAS, the Zone Administrator's letter regarding the TIRZ Improvements is attached hereto and incorporated by reference herein as Exhibit "C" (the "Zone Administrator's Letter") (collectively, the Engineer's Report, Auditor's Report, and Administrator's Letter may be referred to as "Consultants' Reports"); Now, Therefore, BE IT RESOLVED BY THE BOARD OF DIRECTORS: Section 1. That the Board of Directors hereby approves the Consultants' Reports, and the Reimbursement, including but not limited to, the recommendations that the Shadow Creek Retail, LP be reimbursed for the expenditures enumerated or referenced in the Consultants' Reports plus interest as applicable. Section 2. That the Board of Directors hereby authorizes its Chair to execute the Letter Agreement Establishing Priority for Reimbursement relating to the TIRZ Improvements. Section 3. That the Board of Directors hereby approves the submittal of the Letter Agreements and Consultants' Reports to the City of Pearland, Texas for reimbursement in accordance with procedures established in the Agreement By and Between the City of Pearland, Texas, Reinvestment Zone Number Two, City of Pearland, Texas, and the Development Authority of Pearland, effective as of October 11, 2004. PASSED, APPROVED, AND ADOPTED this 25th day of August, A.D. 2008 _. NI EL HARRISON TIRZ CHAIR, BOARD OF DIRECTORS ATTEST: ~llt A'l9r~la,~ MIKE PYBURN TIRZ SECRETARY, BOARD OF DIRECTORS i, i i iuzaox~~z. a~~ Exhibit "A" Engineer's Report RTIRZ-2008-02 l.J~ ~rac~ineerla~r~ 8, su+rv~zyirx>g, Inc. a ,. m, r .N_.y ~ ...e.. _.__..._ ____ _..... ._..~_ .__._ _ __ i3~.~i"'; „i i..n ~.;C.IO~S RE:Invrc"ritE:r~ Z6nra'JO 2. CIEy nt PF3ari~4l?rj, TE?saS ;~it of Yae:r#;ari<+,, Texas tte ~Rr i -x.~."n.-.r 1 Zo'1e No ~. ~. uy ci Pc2Ftri~nd_ l'c xa !'ryr .,^~IEa(~ .r~ Q~ T!R._' IR7{xr C's P F'7~(g spa+}: - in YhG i Rer f= I~an~anu r'~t;rco-.n5~;7i D~a[pl {jrt ~;er 23 E(i~ r, ; -.. _. ~"re -tit-U')'. Rrsac` ;r = ri,!n s~i1. rn I'IU61~srr R~I;;c. rr .~r~ d!7~f .r, fha;na~;E? ra=.~. fy.'at':9 r:~ !Jffr }f S: 'v, the. ~ 3c,~?~~:~,r 'c.' Mc~iliye~irren[ ~arie NO ._ C:;Iy ;?i f +•a~~aarld, Gras ii}m 7,int; `1- i }u'a•a~ I '. _ ~~v,~rrl __ C[, t ~ 5f`}!' 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"TOSS, Fes{- I-:r;r:m~r;°t Inr tt-~? Zn~i J ~'r; .ii ~•.~i:}ic;hr:trnt~ St~7~dov~d creek Ra~rtch tc;bvs~ uera#er dm~aroverne3~fis E.etEer Fir€~n{ K•e Agryeemene # Q~-D3-O(l2 r'i~t~,.~. ,`' t .1 M1. ~N f.~p~r 1.31 r~~ --:~YYj S,.ryi:p,h .. ~.... ,_ Iter~cs {yp ..),,. tP~..~iid 'nf:.~SteaCfo n, i~ .- }-~R: 'r'cY lixi Le~iJa Gapnrr0 ziitciur)es ca ntinuzkFSrtcrHS 8 enq.) i ,r De N.'tiproiprain3pe Apprnved 0ui3gQt (2006 PeNarv) fl ppJrpti Ftl Budget {A(ij,isisatl Pei t NFY 4n dexl ~__".% _ :a ar-,. .BLS..: Overhead i ~ a(t ia:6 PtaLed [1i38tcr 0r~iund ~ '. r:. r {~? - ?;~a F°q~8fii¢Y Fie{ee.vtion _ .~ . Gn an:p E`n r7u _ Sutxtnk:at _ t,.?ii .. 'sr, R+-v n=q=n•n8 CaaSs ,;n, ;t E>utnTOtai -. !~ ,~,. ~. 'f {3Tk11. S 1.8017.(7(30 ~ i.859.59a - '•~e _; t r-- ~ "+a^ - 'aRrP~-n, .t, [, 4. *6W.. ,T'ra ra lit li.., i.. ..~ irb>s; b! IRi t !,~'.~ t ~i5t N .._ ..._ o .,aS"~, Exhibit "B" Auditor's Report RTIRZ-2008-02 I l Grccnwap Plnzu, Suite 1515 Iluuslon,"CC 77046 (713) 621-1515 I~ax: (773) 621-1570 ~I~L. Null•Lairson C I KTIF IF U Iq.I61.IC ;100011\ I: W IS One SuKar Crecle 13h~d., Suite 9211 tiukar Lund,'fX 77478 (281) 2 4 2-8 61111 Fas: (281)242-7333 rrtnF.titiurx~l ulKrolaulov July 31, 2008 T ~~1 Reinvesnnent "Lone No. Two, City of Pearland, Texas Atm: Chairman, board of Directors Go-City of Pearland, Texas 3519 Pearland Drive Pearland, Texas 77581 Re: Independent Accountants' Report -Completion of "f IRZ improvements Dear Mr. Chairman and Members of the Board: As the independent accountant for Reinvestment Zone No. Two, City of Pearland, Texas (the "Zone"), we have reviewed the completed documentation submitted by Shadow Creek Retail, L. P. (the "Sub Developer") relating to the construction of the TIRZ improvements described by that Letter Financing Agreements noted on Schedule A ([he "Letter Financing Agreements"). By the better Financing Agreement, the Sub Developer agreed to pre-finance the design and construction of the 'TIRZ improvements to be reimbursed in accordance with the Reimbursement Agreement between the City of Pearland (the "City"'), the 7,one and the Sub- Developcr dated November 13, 2006 (the "Reimbursement Agreement'). Based upon our review of the payments made and of the certification of the Zone's Engineer, 1 conclude that the construction of the "TIRZ Improvements was conducted and have been completed in compliance with the Reimbursement Agreement and the document entitled "TIRZ Implementation and Reimbwsement Process" and are in order for reimbursement upon availability of funds. We therefore recommend that the Zone reimbwse the Sub-Developer the amowits indicated on Schedule A for [he funds advanced k) [hc Zone for the design and construction of the TIRZ Improvements, which is within the TIR7, budget (adjusted for inflation) established in the Lonc's Project Plan and Reinvestment Zone Financing Plan, as amended, for the TIR7, improvements. In accordance with the Zone's Project Plan and Reinvestment Zone Financing Plan, as amended, and the Reimbursement Agreement between the City, the 7_one, and the Sub- Developer, "developer interest" on this advance shall be calculated at 6.50 percent per annum for up to five years on the Creation costs and five years from date of completion of construction of the'fIRZ improvements. Based upon this rate of interest, interest due as of the date of the letter is indicated on Schedule A. SCI ILDULG ,A T.1S 1ACRGMI;NT R4;1A1'IS'fh11?N'I' ""/,ON6 NO. 2 ('1'I'Y OI' PL.IRLANU, TP:~AS ~~ bi @~ 12 F,CAP1Tll1.:1'fIOV OF A:~10l~N1'S DUI? "rU ^^^ ~~~/~~i/ /// SHADOW CRF, IsN RE'I'rVL. L.P. :1s nf.luly 31, 201IN Letter finance Agreement LP,1 (LC'A) Uatc 12oad infrastructure, pipeline relocation and site drainage 10/27/06 LFA Actual $ 9,949.618 $ 9.949,618 ** $ 1.065.587 11.015.205 Landscaping, Jctention/drainage, reloartion of overhead utilities and plan amendment costs 03/12/07 1,851,598 1.851,59R **' 113.137 L964,735 $ 11,80 L216 $ 11,801,216 $ 1,178,724 $ 12.979,940 * Interest computed through .Iuly 3 h 2008 at 6.50 % Actual interest will be calculated through the date of bond reimbursement. '"` Actual costs were $ 11,487,664. Rcimhwsemcnt is limited to lesser ol'actual costs or the amount per the LPA. *" Actual costs were $ L861,809. Reimburwment is limited to lesser of actual costs or the vnount per the LPA. Exhibit "C" Zone Administrator's Letter RTIRZ-2008-02 August ] 5, 2008 Pearland Reinvestment Zone No. Two Board of Directors 3519 Liberty Drive Peai9and, TX 77581 Re: Completion of TIRZ Improvements - LFA's 06-] 0-001 and 07-03-002 Dear Board of Directors: I have reviewed the procedures followed by Shadow Creel< Retail LP (the "Sub Developer") related to the implementation of the Zoue projects referenced above. Pursuant to the Letter of Financing Agreement, the Sub-Developer agreed to pre-finance costs associated with the design and construction of these projects and to be reimbursed in accordance wit the Reimbursement Agreement between the City of Pear]and, the 7,one and the Master Developer dated November 13, 2006. E3ased upon my review of the TIRZ Project Implementation Plan and Reimbursement Process and the Letter of Financing Agreement and based upon the Engineer's letter stating that consh'uction is complete and in order (or reimbursement, I conclude that the above LPA's qualify for reinilnuscments. Sincerely, L,~L~.,c U[~~C1~P11 Claire Bogard City of Pearland, TX DICI'C1or of Finance 3519 LIBEtt"rY DRIVli PEAP.LAND, TLXAS 77587-5476 281 -G52-1600 www.ci.pearland.tx.us Exhibit "D" SCR Retail Letter RTIRZ-2008-02 REINVESTMENT ZONE NUMBER TWO CITY OF PEARLAND, TEXAS LETTER AGREEMENT ESTABLISHING PRIORITY FOR REIMBURSEMENT August 25, 2008 Shadow Creek Retail, LP Attn: Tv Puckett 1900 West Loop South Suite 7300 Houston, Texas 77027 Re: Your Application for Reimbursement pursuant to Letter Financing Agreement Nos. 06-10-001 and 07-03-002 Dear Sir or Madam: The Board of Directors of Reinvestment Zone Number Two, City of Pearland, Texas, and its consultants, have received and reviewed your Application for Reimbursement of the above-referenced Letter Financing Agreements. At its meeting on August 25, 2008, the Board of Directors approved your Application for Reimbursement. The Board of Directors has submitted your approved Application for Reimbursement to the City of Pearland and the Development Authority of Pearland for reimbursement in accordance with the procedures established in the Agreement By and Between the City of Pearland, Texas, Reinvestment Zone Number Two, City of Pearland, Texas, and the Development Authority of Pearland, effective as of October 11, 2004. The Project reimbursement costs will now be logged for priority of reimbursement as established by the reimbursement approval date and the Project and Financing Plan. A copy of the Resolution Approving Recommendation for Reimbursement is attached. Sincerely, Chair, Board of Directors 2008. Agreed to and accepted by Shadow Creek Retail, LP this 25thday of August SHADOW CREEK RETAIL, LP, a Delaware limited partnership By: Shadow Creek Retail GP, LLC, a Delaware limited liability company, its General Partner Title: Vlcc-- P- • AGENDA REQUEST BUSINESS OF THE TIRZ NO. 2 PEARLAND,TEXAS AGENDA OF: 08/25/2008 ITEM NO.: RTIRZ-2008-02 DATE SUBMITTED: 08/18/2008 REPRESENTING: ABHR PREPARED BY: Lynne Humphries PRESENTOR: Mark McGrath SUBJECT: Reimbursement of Zone projects EXHIBITS: Resolution RTIRZ-2008-02 Approving Recommendation for Reimbursement with Exhibit "A" Engineer's Report; Exhibit "B" Auditor's Report, and Exhibit "C" Administrator's Letter "D" Letter Agreement for SCR Retail EXPENDITURE REQUIRED: None until bond reimbursement, at which time developer will be due $12,979,940 of tax increment plus additional developer interest added at funding PROJECT: Road Infrastructure, Pipeline Relocation and Site Drainage and Town Center Improvements EXECUTIVE SUMMARY In accordance with the Zone's Reimbursement Agreement with Shadow Creek Retail, LP, the Developer agreed to pre -finance design and construction of the SH Road Infrastructure, Pipeline Relocation and Site Drainage and Town Center Improvements, via Letter Financing Agreements 06-10-001 and 07-03-002. The Board of Directors approved these Letter Financing Agreements on October 23, 2006 and March 12, 2007. Construction of these project has been completed. The engineer, auditor, and administrator have reviewed the construction projects and have approved them for reimbursement. The Board is therefore requested to approve the project for reimbursement, make a recommendation to the City to authorize reimbursement of the project, and authorize the Chair to execute the Letter Agreement Establishing Priority for Reimbursement. RECOMMENDED ACTION Adopt Resolution Approving Recommendation for Reimbursement (which authorizes the Chair to execute Letter Agreement Establishing Priority for Reimbursement). AR SC Retail.doc CERTIFICATE FOR RESOLUTION THE STATE OF TEXAS § COUNTIES OF BRAZORIA AND FORT BEND § I, the undersigned officer of the Board of Directors of Reinvestment Zone Number Two, City of Pearland, Texas, hereby certify as follows: 1. The Board of Directors of Reinvestment Zone Number Two, City of Pearland, Texas, convened in regular session on the 25th day of August, 2008, at the regular meeting place thereof, and the roll was called of the duly constituted officers and members of the Board to -wit: Nigel Harrison Chair Gary Cook Vice Chair Mike Pyburn Secretary Jo Knight Director Ron Castillo Director Gary Davis Director Donna Coleman Director Larry Loessin Director Ken Phillips Director and all of said persons were present, except Director(s) Mike Pyburn and Ron Castillo, thus constituting a quorum. Whereupon, among other business, the following was transacted at the meeting: a written A RESOLUTION OF PEARLAND TAX INCREMENT REINVESTMENT ZONE #2 (TIRZ #2) APPROVING RECOMMENDATION FOR REIMBURSEMENT (LFA Nos. 06-10-001 and 07-03-002) was introduced for the consideration of the Board. It was then duly moved and seconded that the resolution be adopted, and, after due discussion, the motion, carrying with it the adoption of the resolution, prevailed and carried unanimously. 2. That a true, full and correct copy of the aforesaid Resolution adopted at the meeting described in the above and foregoing paragraph is attached to and follows this certificate; that the Resolution has been duly recorded in the Board's minutes of the meeting; that the persons named in the above and foregoing paragraph are the duly chosen, qualified and acting officers and members of the Board as indicated therein; that each of the officers and members of the Board was duly and sufficiently notified officially and personally, in advance, of the time, place and purpose of the aforesaid meeting, and that the Resolution would be introduced and considered for adoption at the meeting, and each of the officers and members consented, in advance, to the holding of the meeting for such purpose; that the meeting was open to the public as required by law; and that public notice of the time, place and subject of the meeting was given as required by applicable laws, including without limitation, Chapter 551, Texas Government Code. SIGNED this 25th day of August, 2008. f, Secretary, B and of D' ectors RTIRZ-2008-02 CERTIFICATE FOR RESOLUTION THE STATE OF TEXAS § COUNTIES OF BRAZORIA AND FORT BEND § I, the undersigned officer of the Board of Directors of Reinvestment Zone Number Two, City of Pearland, Texas, hereby certify as follows: 1. The Board of Directors of Reinvestment Zone Number Two, City of Pearland, Texas, convened in regular session on the 25th day of August, 2008, at the regular meeting place thereof, and the roll was called of the duly constituted officers and members of the Board to -wit: Nigel Harrison Chair Gary Cook Vice Chair Mike Pyburn Secretary Jo Knight Director Ron Castillo Director Gary Davis Director Donna Coleman Director Larry Loessin Director Ken Phillips Director and all of said persons were present, except Director(s) Mike Pyburn and Ron Castillo, thus constituting a quorum. Whereupon, among other business, the following was transacted at the meeting: a written A RESOLUTION OF PEARLAND TAX INCREMENT REINVESTMENT ZONE #2 (TIRZ #2) APPROVING RECOMMENDATION FOR REIMBURSEMENT (LFA Nos. 06-10-001 and 07-03-002) was introduced for the consideration of the Board. It was then duly moved and seconded that the resolution be adopted, and, after due discussion, the motion, carrying with it the adoption of the resolution, prevailed and carried unanimously. 2. That a true, full and correct copy of the aforesaid Resolution adopted at the meeting described in the above and foregoing paragraph is attached to and follows this certificate; that the Resolution has been duly recorded in the Board's minutes of the meeting; that the persons named in the above and foregoing paragraph are the duly chosen, qualified and acting officers and members of the Board as indicated therein; that each of the officers and members of the Board was duly and sufficiently notified officially and personally, in advance, of the time, place and purpose of the aforesaid meeting, and that the Resolution would be introduced and considered for adoption at the meeting, and each of the officers and members consented, in advance, to the holding of the meeting for such purpose; that the meeting was open to the public as required by law; and that public notice of the time, place and subject of the meeting was given as required by applicable laws, including without limitation, Chapter 551, Texas Government Code. SIGNED this 25th day of August, 2008. [�/Ilz/r fu id Secretary, B and of rectors RTIRZ-2008-02 RESOLUTION NO. RTIRZ-2008-02 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE PEARLAND TAX INCREMENT REINVESTMENT ZONE NUMBER TWO (TIRZ #2) APPROVING RECOMMENDATION FOR REIMBURSEMENT (LETTER FINANCING AGREEMENT (LFA)NOS. 06-10-001 and 07-03-002) WHEREAS, Reinvestment Zone Number Two, City of Pearland, Texas (the "Zone") has been legally created by the City of Pearland, Texas (the "City"), pursuant to Chapter 311, Texas Tax Code; and WHEREAS, the City and Zone have approved the Zone's Project Plan and Reinvestment Zone Financing Plan, and amendments (the "Plan"); and WHEREAS, the City, the Zone and Shadow Creek Retail, LP entered into a Developer Reimbursement Agreement as of November 13, 2006, in order to implement a portion of the Plan and facilitate the development of the public improvements related to the project and described in the Plan and to provide reimbursement to Shadow Creek Retail, LP for costs and expenditures related to such improvements recommended for approval by the Board of Directors of the Zone (the "Board of Directors") from the Zone's engineer (the "Zone Engineer"), the Zone's auditor (the "Zone Auditor") and the consultants or City staff administering the affairs of the Zone (the "Zone Administrator"); and WHEREAS, the Shadow Creek Retail, LP and the Zone entered into two Letter Financing Agreements, dated March 12, 2007 and October 23, 2006 (collectively the "Letter Agreements") in which the Board of Directors approved construction of the specific TIRZ improvements described in the Letter Agreements and established a budget related to reimbursement (the "TIRZ Improvements"); and WHEREAS, the Shadow Creek Retail, LP has applied to the Zone (the "Application"), for reimbursement of Shadow Creek Retail, LP's costs and expenditures, plus interest, incurred in developing the TIRZ Improvements as described in and contemplated by the Letter Agreements; and WHEREAS, in response to the Shadow Creek Retail, LP's Application, the Zone Engineer, the Zone Auditor and the Zone Administrator have reviewed the Application and the TIRZ Improvements and have certified that the TIRZ Improvements are complete and are in order for reimbursement in accordance with the Application (the "Reimbursement"); and WHEREAS, the Zone Engineer's letters regarding the TIRZ Improvements are attached hereto and incorporated herein as Exhibit "A" (the "Engineer's Report"); and WHEREAS, the Zone Auditor's letter regarding the TIRZ Improvements is attached hereto and incorporated herein as Exhibit "B" (the "Auditor's Report"); and RTIRZ-2008-02.doc WHEREAS, the Zone Administrator's letter regarding the TIRZ Improvements is attached hereto and incorporated by reference herein as Exhibit "C" (the "Zone Administrator's Letter") (collectively, the Engineer's Report, Auditor's Report, and Administrator's Letter may be referred to as "Consultants' Reports"); Now, Therefore, BE IT RESOLVED BY THE BOARD OF DIRECTORS: Section 1. That the Board of Directors hereby approves the Consultants' Reports, and the Reimbursement, including but not limited to, the recommendations that the Shadow Creek Retail, LP be reimbursed for the expenditures enumerated or referenced in the Consultants' Reports plus interest as applicable. Section 2. That the Board of Directors hereby authorizes its Chair to execute the Letter Agreement Establishing Priority for Reimbursement relating to the TIRZ Improvements. Section 3. That the Board of Directors hereby approves the submittal of the Letter Agreements and Consultants' Reports to the City of Pearland, Texas for reimbursement in accordance with procedures established in the Agreement By and Between the City of Pearland, Texas, Reinvestment Zone Number Two, City of Pearland, Texas, and the Development Authority of Pearland, effective as of October 11, 2004. PASSED, APPROVED, AND ADOPTED this 25th day of August, A.D. 2008. NI EL HARRISON TIRZ CHAIR, BOARD OF DIRECTORS ATTEST: MIKE PY U N TIRZ SECRETARY, BOARD OF DIRECTORS RTIRI_-2008-02.doc Exhibit "A" Engineer's Report RTIRZ-2008-02 LJA Engineering & Surveying, Inc. www jaerpneertn-a_,(r 4 ly 2008 J I.; Directors Reinvestment Zone No. 2. City of Pearland, Texas (jiyof Peariand, 1"exas 3:-) 9 L i b c r t y () r i v e Pear4.,),nd. Texas 77581 Re `heir -vestment Zone No. 2, City of Pearland. Texas Completion of TIRZ impruvernen . ts Described in the Letter Financing Agreement Dated October 23, 2006 LIP -A #* 06_10-oCi1 Road Infrastructure, Pipeline Reloration and Site Drainage JA job No. 1546.-0000 (12,91f tear Board of Directors: As the Engineer 'tar Reinvestment Zone No, 2, City of Pearland, Texas (ffie "Zone"); 1 have reviewed the cornpleted documentation submitted by Shadow Creek Retail, P. (the 'Sub -Developer") reli fing to the TIRZ described by the Letter Financing Agreement # 06-10-(.'101 daleci October 23; 2006 (the "Leter Financing Agreement"), By the Letter Financing Agreement, th.;e Sub - Developer aqreec,,, to pre -finance, the design and construdion of the TIRZ Improvements to be re:mbuzsed in accordance with the Reimbursement Agreement between the City of Pearland, the Zone and the Sub -Developer dated November 13, 2006 ("the Agreement"). the [.etter Financing Agreement states that the Zome's Project Plan and Reinvestment Zone Improvements is S9,949,618 plus 'developer Agreement, budget (adjusted for inflation) establishred in the Pinancing, Plan, as amended, for the TfRZ interest" calculated per the "Reirnburser-nent Mif-; SI!l)-Df-Ivelo, , Der hias provided, and f have reviewed, the necessary documentation to prove. (�Qrllptiiance With all procedures se4, forth in the doCUment entitled "TIRZ Project Irripleeflentatiof i and Reim o-ursement Process" Based upon my review. I conclude that the (.znstructio(I of the TIRZ !w-n.>rove-nents was cl-Inductedi in compliance with the Reimbursement Agreement and the VOCadluras Set forth in the document entitled "TIRZ Project Implementation and Reimbursement Process is complete and is in order for reimbursement, i therefore recommend that the Zone rairnburse the Sub-Deveioper the arnount of $9,949,618 for the funds advanced to the Zone for the TIRZ Improvements, plus "developer interest" calculated per the ReirrIbursemerit Agreement; as applicable A detailed breakdown of the costs of the TIRZ Improvements is attached to this letter. if YOu have ary qi-testions, please call me at 7119,53.5096. iL D. Ross. ngineet fear' the Zonp IDL A t Ua cnrn c n i Road Infrastructure, Pipeline Relocation and Site Drainage Letter Finance Agreement # 06-10-001 lfern.ized BreaKdown of Costs Items NFRASTROMPE Major Road Infrastructure 510-3C'4.a"'; VV:ctenin"4 3us fess Ceote- 'Drive Pavrnq N;e Pav;nq Laidscaping (includes continagencies & eng.) lrwz. DetantiuWl)i ainage Land ce'er;n Overhead Utilities Placed Uoderground Pipeline Refocation, Engineering Approved Budget Approved Budget (Adjusted per ENR (2006 Dollars) Index) 2 831.7&) S 2,831,789 $t L. 7 Z2 G52.722 $ 383. $ 2, 6 rY) . 0 3 2, S "1 0 10 1, 142.00;0; 4 2 N $ 730,000 S 71"3(1. OPOO 14' 490 000 q 400 Ord-, 9,940,618 Is Of. 0 4 9, 6 1 8 Plin Amendment Costs $ St;btotal OTAL 9.949,618 71;20�2CIS Total Actuat Costs S 7 4,5 S 1 S I, a39,444 14S7 6,j4 the r et 1. L Ip, Agreerner'. reirnburse-ment istim;ted to IN lesser of the -actuat costs or he a,,prc?ieo adrls�d fol Wlat;on. LJA Engineering & Surveying, Inc. i 3, 9-53 521M. TFxas 17U-2-311031 www July 25, 2008 Board of k"),irectors ReNrivestoryient Zone No, 2, City of Pearland, Texas c,fo City of Pearlpnd, Texas 315 19 Liberty Drive Peatfai,4, Texas 77581 Re Reinvestment Zone No. 2, City of Pe,-*irlandl. Texas -,c;rn.pf(,tjr;n of,r1RZ Improve Mients Described in the L-eaer Financing Agreement Datt,.-lcj march 12, 200*7 LFA .107 -03-002 - Shadow Creek Ranch Town Center Irrprovements LJA Job No 1546-0000 (12 9) Deal Board of Directors-, As the Engineer ft.-ir Reinvestment Zone Nn, 2, City of Pearland, Texas ;'the "Zone"), I have reviewed the, c."Irripleted documentation Submitted by Shadow Creek Retail, L,P, tote 'SUb-Developer"', rr la`;hrig to the TIRZ li,Hprovernents described by the Letter Financing Agreery,,ent 4 07-023-002 dated Nrl-irch 12: 20(';7 fthe I.etter Financing Agreerrient"). By the Lettpr Financing Agreement, the Sub - to i-ma-finance Ole design and construction of the irnprovements to be .?per -11 1� . I , rlR; 1M.b1urse11 in ac,,�()rdance with the Reimbursement Agreernent between the City of Peariand. the Zonsand tho Suo-Developer cl,,.,ited November 13, 2006 (the "ReirribMs. ement Agreemerirl. The Letter =inancinq Agreement states that the budget !adjusted for inflation.) established in the Z,,)np*s Project Plan and Reinvestment Zone Financing Plan, as amended, for the TIRZ ln-,woverrients is $1,851.-598 plus "developer interest" calculated per the Reirriburq., rnert Agreement. The Seib -Developer has provided, and I have reviewed, the necessary documentati(,,,ni to prove c,orripliance with all proic adures set forth in the document entitled "TIRZ Prolect Implorlrientation and Rpirnil3ursernerit Process'. Based upon t,,ry review. I conclude that the ce,Nnstru,cticn of the TIRZ irnpr overterls was conducted in compliance with the Reimbursement Agreement and the p ,nocpOures set forth in the document entitled "TIRZ Project implementation and Reim.bUrserrient Process` is complete and is in order for reirnburserneM. I therefore recommend that the Zone reiniburse the Sub -Developer the amount of $1,851,598 for the funds advanced to the Zone for the TIRZ J; -riproverients, talus "developer interest*' catculatecif per the ReirnbUrsernent Agreement, as apoiicable. A detailed breakdown of the costs of the 'TiRZ improvements Is attached to this fetter 'i(Al' have ally ;11Ue.StIC)IIS please, caH rn at 713, gr 3.509 James DRoss, PE Encinerer for the Zone J URT I ;dl Attac!-,!nRnt Shadow Creek Parch Town Center Improvements Letter Finance Agreement # 07-03-002 iten"( ed Bireakdown oaf Costs llri�,-,,,A Jan 2tXi,* -R79. 5; 3 Items INFRAC STRUIURE Major Road Infrastructure V 'B"',iiiess cpnte, paviog Mem, I a�',dscaPing (includes confinegencies & eng.) Drive Mernon*� Heri--ifin DIvp Detention/Drainago .4 Overhead Utilities Placed Underground PpOmt,, Relocation Fliqweenng Approved Budget Approved Budget (Adjusted per ENR (2006 Dollars) Index) $ i�7500 $ 162,015 � e7, 5 0 0 S 6 9.4, 3 N," Plan. Amendment Costs Subtotal $ TOTAL $ S PCI ',`P xt#r i f Fi.-Iarce lesse.. lf,eactual Fr'o" Totai Actual Costs 1 855. 85 2 LL— I Greenway Plaza, Suite 1515 Houston, TX 77046 (713) 621-1515 Fax: (713) 621-1570 ATL Null•Lairson CEK71FIED PUHUC ACC0L1N- ANTS PROWSSKAX COKPOKiTON Exhibit "B" Auditor's Report RTIRZ-2008-02 One Sugar Creek Blvd., Suite 920 Sugar Land, TX 77478 (281)242-8600 Fax: (281) 242-7333 July 31, 2008------ -- - Reinvestment Zone No. Two, DEAFT.-JI City of Pearland, Texas Attn: Chairman, Board of Directors C/o- City of Pearland, Texas 3519 Pearland Drive Pearland, Texas 77581 Re: Independent Accountants' Report - Completion of TIRZ improvements: Dear Mr. Chairman and Members of the Board: As the independent accountant for Reinvestment Zone No. Two, City of Pearland, Texas (the "Zone"), we have reviewed the completed documentation submitted by Shadow Creek Retail, L.P. (the "Sub Developer") relating to the construction of the TIRZ Improvements described by that Letter Financing Agreements noted on Schedule A (the "Letter Financing Agreements"). By the Letter Financing Agreement, the Sub Developer agreed to pre -finance the design and construction of the TIRZ improvements to be reimbursed in accordance with the Reimbursement Agreement between the City of Pearland (the "City"), the Zone and the Sub - Developer dated November 13, 2006 (the "Reimbursement Agreement"). Based upon our review of the payments made and of the certification of the Zone's Engineer, I conclude that the construction of the TIRZ Improvements was conducted and have been completed in compliance with the Reimbursement Agreement and the document entitled "TIRZ Implementation and Reimbursement Process" and are in order for reimbursement upon availability of funds. We therefore recommend that the Zone reimburse the Sub -Developer the amounts indicated on Schedule A for the funds advanced to the Zone for the design and construction of the TIRZ Improvements, which is within the TIRZ budget (adjusted for inflation) established in the Zone's Project Plan and Reinvestment Zone Financing Plan, as amended, for the TIRZ improvements. In accordance with the Zone's Project Plan and Reinvestment Zone Financing Plan, as amended, and the Reimbursement Agreement between the City, the Zone, and the Sub - Developer, "developer interest" on this advance shall be calculated at 6.50 percent per annum for up to five years on the Creation costs and five years from date of completion of construction of the TIRZ improvements. Based upon this rate of interest, interest due as of the date of the letter is indicated on Schedule A. SCHEDULE A TAX INCREMENT REINVESTMENT ZONE NO.2 CITY OF PEARLAND, TEXAS RECAPITULATION OF AMOUNTS DUE TO SHADOW CREEK RETAIL, L.P. As of July 31, 2008 Letter Finance Agreement LFA (LFA) Date Road infrastructure, pipeline relocation and site drainage 10/23/06 Landscaping, detention/drainage, relocation of overhead utilities DRAFT I, LFA Actual Amount Cost Interest * To S 9,949,618 S 9,949,618 ** S 1,065,587 11,0 and plan amendment costs 03/12/07 1,851,598 1,851,598 *** 113,137 1,9( S 11,801,216 S 11,801,216 S 1,178,724 S 12,9' * Interest computed through July 31, 2008 at 6.50%. Actual interest will be calculated through the date of bond reimbursement. * * Actual costs were $11,487,664. Reimbursement is limited to lesser of actual costs or the amount per the LFA. * * * Actual costs were S 1,861,809. Reimbursement is limited to lesser of actual costs or the amount per the LFA. Exhibit "C" Zone Administrator's Letter RTIRZ-2008-02 G PEARLAND T E X A 5 �FS r. t a °� August 15, 2008 Pearland Reinvestment Zone No. Two Board of Directors 3519 Liberty Drive Pearland, TX 77581 Re: Completion of TIRZ Improvements — LFA's 06-10-001 and 07-03-002 Dear Board of Directors: I have reviewed the procedures followed by Shadow Creek Retail LP (the "Sub Developer") related to the implementation of the Zone projects referenced above. Pursuant to the Letter of Financing Agreement, the Sub -Developer agreed to pre -finance costs associated with the design and construction of these projects and to be reimbursed in accordance wit the Reimbursement Agreement between the City of Pearland, the Zone and the Master Developer dated November 13, 2006. Based upon my review of the TIRZ Project Implementation Plan and Reimbursement Process and the Letter of Financing Agreement and based upon the Engineer's letter stating that construction is complete and in order for reimbursement, I conclude that the above LFA's qualify for reimbursements. Sincerely, Claire Bogard City of Pearland, TX Director of Finance 3519 LIBERTY DRIVE • PEARLAND, TEXAS 77581-5416 • 281-652-1600 • www.ci.pearlandAx.us Exhibit "D" SCR Retail Letter RTI RZ-2008-02 REINVESTMENT ZONE NUMBER TWO CITY OF PEARLAND, TEXAS LETTER AGREEMENT ESTABLISHING PRIORITY FOR REIMBURSEMENT August 25, 2008 Shadow Creek Retail, LP Attn: Ty Puckett 1900 West Loop South Suite 1300 Houston, Texas 77027 Re: Your Application for Reimbursement pursuant to Letter Financing Agreement Nos. 06-10-001 and 07-03-002 Dear Sir or Madam: The Board of Directors of Reinvestment Zone Number Two, City of Pearland, Texas, and its consultants, have received and reviewed your Application for Reimbursement of the above -referenced Letter Financing Agreements. At its meeting on August 25, 2008, the Board of Directors approved your Application for Reimbursement. The Board of Directors has submitted your approved Application for Reimbursement to the City of Pearland and the Development Authority of Pearland for reimbursement in accordance with the procedures established in the Agreement By and Between the City of Pearland, Texas, Reinvestment Zone Number Two, City of Pearland, Texas, and the Development Authority of Pearland, effective as of October 11, 2004. The Project reimbursement costs will now be logged for priority of reimbursement as established by the reimbursement approval date and the Project and Financing Plan. A copy of the Resolution Approving Recommendation for Reimbursement is attached. Sincerely, Chair, Board of Directors 2008. Agreed to and accepted by Shadow Creek Retail, LP this 2 5 th day of August SHADOW CREEK RETAIL, LP, a Delaware limited partnership By: Shadow Creek Retail GP, LLC, a Delaware limited liability company, its General Partner By:�'Xz. Title: V'lc fDREz5/ PE/U t CERTIFICATE FOR RESOLUTION THE STATE OF TEXAS § COUNTIES OF BRAZORIA AND FORT BEND § I, the undersigned officer of the Board of Directors of Reinvestment Zone Number Two, City of Pearland, Texas, hereby certify as follows: 1. The Board of Directors of Reinvestment Zone Number Two, City of Pearland, Texas, convened in regular session on the 25th day of August, 2008, at the regular meeting place thereof, and the roll was called of the duly constituted officers and members of the Board to -wit: Nigel Harrison Chair Gary Cook Vice Chair Mike Pyburn Secretary Jo Knight Director Ron Castillo Director Gary Davis Director Donna Coleman Director Larry Loessin Director Ken Phillips Director and all of said persons were present, except Director(s) Mike Pyburn and Ron Castillo, thus constituting a quorum. Whereupon, among other business, the following was transacted at the meeting: a written A RESOLUTION OF PEARLAND TAX INCREMENT REINVESTMENT ZONE #2 (TIRZ #2) APPROVING RECOMMENDATION FOR REIMBURSEMENT (LFA Nos. 06-10-001 and 07-03-002) was introduced for the consideration of the Board. It was then duly moved and seconded that the resolution be adopted, and, after due discussion, the motion, carrying with it the adoption of the resolution, prevailed and carried unanimously. 2. That a true, full and correct copy of the aforesaid Resolution adopted at the meeting described in the above and foregoing paragraph is attached to and follows this certificate; that the Resolution has been duly recorded in the Board's minutes of the meeting; that the persons named in the above and foregoing paragraph are the duly chosen, qualified and acting officers and members of the Board as indicated therein; that each of the officers and members of the Board was duly and sufficiently notified officially and personally, in advance, of the time, place and purpose of the aforesaid meeting, and that the Resolution would be introduced and considered for adoption at the meeting, and each of the officers and members consented, in advance, to the holding of the meeting for such purpose; that the meeting was open to the public as required by law; and that public notice of the time, place and subject of the meeting was given as required by applicable laws, including without limitation, Chapter 551, Texas Government Code. SIGNED this 25th day of August, 2008. uivj dlda) Secretary, 0oard of Directors RTIRZ-2008-02 RESOLUTION NO. RTIRZ-2008-02 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE PEARLAND TAX INCREMENT REINVESTMENT ZONE NUMBER TWO (TIRZ #2) APPROVING RECOMMENDATION FOR REIMBURSEMENT (LETTER FINANCING AGREEMENT (LFA)NOS. 06-10-001 and 07-03-002) WHEREAS, Reinvestment Zone Number Two, City of Pearland, Texas (the "Zone") has been legally created by the City of Pearland, Texas (the "City"), pursuant to Chapter 311, Texas Tax Code; and WHEREAS, the City and Zone have approved the Zone's Project Plan and Reinvestment Zone Financing Plan, and amendments (the "Plan"); and WHEREAS, the City, the Zone and Shadow Creek Retail, LP entered into a Developer Reimbursement Agreement as of November 13, 2006, in order to implement a portion of the Plan and facilitate the development of the public improvements related to the project and described in the Plan and to provide reimbursement to Shadow Creek Retail, LP for costs and expenditures related to such improvements recommended for approval by the Board of Directors of the Zone (the "Board of Directors") from the Zone's engineer (the "Zone Engineer"), the Zone's auditor (the "Zone Auditor") and the consultants or City staff administering the affairs of the Zone (the "Zone Administrator"); and WHEREAS, the Shadow Creek Retail, LP and the Zone entered into two Letter Financing Agreements, dated March 12, 2007 and October 23, 2006 (collectively the "Letter Agreements") in which the Board of Directors approved construction of the specific TIRZ improvements described in the Letter Agreements and established a budget related to reimbursement (the "TIRZ Improvements"); and WHEREAS, the Shadow Creek Retail, LP has applied to the Zone (the "Application"), for reimbursement of Shadow Creek Retail, LP's costs and expenditures, plus interest, incurred in developing the TIRZ Improvements as described in and contemplated by the Letter Agreements; and WHEREAS, in response to the Shadow Creek Retail, LP's Application, the Zone Engineer, the Zone Auditor and the Zone Administrator have reviewed the Application and the TIRZ Improvements and have certified that the TIRZ Improvements are complete and are in order for reimbursement in accordance with the Application (the "Reimbursement"); and WHEREAS, the Zone Engineer's letters regarding the TIRZ Improvements are attached hereto and incorporated herein as Exhibit "A" (the "Engineer's Report"); and WHEREAS, the Zone Auditor's letter regarding the TIRZ Improvements is attached hereto and incorporated herein as Exhibit °B" (the "Auditor's Report"); and RTIRZ-2008-02.doc WHEREAS, the Zone Administrator's letter regarding the TIRZ Improvements is attached hereto and incorporated by reference herein as Exhibit "C" (the "Zone Administrator's Letter") (collectively, the Engineer's Report, Auditor's Report, and Administrator's Letter may be referred to as "Consultants' Reports"); Now, Therefore, BE IT RESOLVED BY THE BOARD OF DIRECTORS: Section 1. That the Board of Directors hereby approves the Consultants' Reports, and the Reimbursement, including but not limited to, the recommendations that the Shadow Creek Retail, LP be reimbursed for the expenditures enumerated or referenced in the Consultants' Reports plus interest as applicable. Section 2. That the Board of Directors hereby authorizes its Chair to execute the Letter Agreement Establishing Priority for Reimbursement relating to the TIRZ Improvements. Section 3. That the Board of Directors hereby approves the submittal of the Letter Agreements and Consultants' Reports to the City of Pearland, Texas for reimbursement in accordance with procedures established in the Agreement By and Between the City of Pearland, Texas, Reinvestment Zone Number Two, City of Pearland, Texas, and the Development Authority of Pearland, effective as of October 11, 2004. PASSED, APPROVED, AND ADOPTED this 25th day of August, A.D. 2008 NI EL HARRISON TIRZ CHAIR, BOARD OF DIRECTORS ATTEST: MIKE PY U N TIRZ SECRETARY, BOARD OF DIRECTORS RTW--2008-02.doc Exhibit "A" Engineer's Report RTIRZ-2008-02 LJA Engineering & Surveying, Inc. T W: W ee, ,i ne e r3 n ti. c o r iY 2`, 2008 Borirdl of Cii,rectorc> Reinvestment Zone No. 2, City of Pearlarid, Texas .vo City of Pearland, Texas 3,519 Liberty Drive Pearland, T'exas 77.581 Re Reinvestment Zone No. 2, City of'Pearland,Texas Completion of TIRZ imprOverTlents Described in the Letter Financing Agreement Dated October 23; 2006 f - A Y -10-001 - Road infrastructure, Pipeline Reloration ard, Site Drainage 'ob No. 1546-0000 (12,9'1 Dear Board of [Arectors: As "lie Erigineer f0lr Reinvestment Zone No, 2, City of Pearland. Texas (the "Zone"), I have reviewed the completed docurrientation submitted by Shadow Creek Retail, LP. (the "Sub-Deveioper'� relating to the TIRZ innprovemerts described by the Letter Financing Agreement # 06-10-001 dated October 23, 20,06 (the "Letter Financing Agreement"'), By the Letter Financing Agreement, the Sub- Develolper agreed to pa. —finance the design and constniction of the TIRZ Improvernents to be reimbursed in accordance with the Reimbursement Agireen'"IenIt between the City (.,;f Pearl-111and. the Zonean.cl lhe Sub Developer dated November 13, 2006 (the "Reunburs(-,,-rrient Acir'eer ient"). il-ette, k:iiiiancing Agreement states that the Zknne',,;; Proilect Plan and Reinvestment Zone Un.1-1rovements, is W949,6118 pies "developer Agreement, budget (adjusted for inflation) establish,,ed in the Financina Plan, as amended, for the TIRZ interest" Calculated per the iReirnbursernerit he Si!b-Developer has provided, and I have reviewed, the necessary documentation to prove compliance with all, procedures set forth in the document entitled `TIRZ Proiecl Irriplementation ana Reitrib-ursement Process". eased upon my review, I conclude that the construction of the IRZ Wnprowpin-ents was conducted; in compliance with the Reirribursernent Agreement and me procedures set forth in the document entilled "TIRZ Project Implementation arid Re,n, burs ement PrQCN-ISS', is complete and is in order for reimbursement, I therefore recommend that 'he Zone rairriburse the Sub -Developer the amount of $9,949,618 for the funds advanced to the Zone for the TIRZ Improvements. plus "developer interest' Icatculated per the Reirribursernent Agreement; as applicable, A -detailed breakdown of the costs of the TIRZ Improvements is attached to this letter. you h-a%ee ai,zy qt.;05tions, please: call me at 7119533.5096. James D Ross, PT Pr"711fir-er for the Attacnmen! 0 Road Infrastructure, Pipeline Relocation and Site Drainage Letter Finance Agreement # 06-10-001 1!errilZed BrEaKdown of Costs E-N�� :T'Iex J.4r), 2f0,)(-' 7660 Items NFRASTRUtTME ---- Major Road Infrastructure Bfoaoway "vVice-Qng C wal?& Drive -ierrnann DnVe PaV;nQ Landscaping (includes continagencies & eng.) C--en-y�r DrfyE PVlornorra; Hermann Drive Datentiow'Drainage and 3Caut-11' oriid Creat4r, ,4e Overhead Utilities Placpd Underground Plr*fine Relocation Engineering Approved Suckjet Approved Fludget (Adjusted per ENR (2006 Dollars) Index) 2.831 , 789 S $ 8521722 $ 2 383.107 S 383.10,17 $ 1,342.' 000 700,Goo S $ 490000 0. 400 000 Subtotal 9 4 9. 618 Pf.,'.,In Amendment Casts $ Subtotall: TOTAL $ 9,940,613 P�' the Le!`Pr Of Finance Agreen er', reimbuirsernent is limjQed to the lesser of the actual costs or 'he wy)C.lw-1 adlusfE4 tu .r]n. Fwal Act?,? Costs 34.97 11,3174. 2. 75 LJA Engineering & Surveying, Inc. 09 ;fir 3t'K Fli 1,.ne t'QM3 520C ,,3.953.5026 7-x;jS (),12-3703 w,,vw ,July 25, 2008 Board of Directors Reinvestment Zone No. 2, City of Pearland, Texas c/o City of Pearland. Texas 3519 Liberty Drive Peadand, Texas 77581 RaReinvestment Zone No, 2, City of Pearland, Texas Ccrnofetinn of r I IRZ Improvements ovements Desrribed in the Letter Financing Agreement Date -al March 12, 2007 LFA .10.7-031-002 -- Shadow Creek Ranch Town Center lmprcivem�lnts LJA Job No. 1546-0000 (12 9) Dear Board of Directors-, As the Engineer for Reinvestment Zone No, 2, City of Pearland, Texas !the "Zone"), I have reviewed Me, corripleied documentation submitted by Shadow Creek Retail, L.P. (the 'SubrDevefope;-, ret ,tiny to the TIRZ Improvements described by the Letter Financing Agreement # 07-031-002 dated I'v1,1rch !2, 2007 (the 'Letter Financing Agreement"'). By the Letter Financing Agreement, the. Sub- Develooer :greed to iore-finance the design and construction of the FIRZ Improvements to be in accordance with the ReirlbUrsernent Agreement between the City of Peartanei. the Zone ==nd thr-, Sut)-,Developer dated November 13: 2006 (the "ReirribUisement Agreemert'). The Letter Pinancin( ,4 Agreertlent states that the Zone's Project Plan and Reinvestment Zone Improvements is $1 851-598 plus "developer Agreement. budget 'adjusted for inflation ' I established in the Financing Plan, as amended, for the TlRz interest" calculated per the Reim burscmpntt The Sub -Developer has provided, and ; have reviewed. the necessai-y- documentation to prove compliance with all prociedures set forth in the document entitled "TIRZ Project Implerventation and RetmbUf-sernent Process". Based upon my review, I conclude that the, construction of th;,;, TIRZ improverrients was conducted in compliance with the Reimbursement "Agreement and the Procedures set forth in the document entitled "TIRZ Project Implementation and Reimbursement Process` is complete and is in order for reirnbursernent. I therefore recommend that the Zone reimburse the Sub -Developer the amount of $1,851,598 for the funds advanced to the Zone for the TIRZ linprovernents, plus "developer interest" calculated per the Reimbursement Agreement, ors applicableA dolailed breakdown of the costs of the'I'IRZ Improvements is attached to this letter f You have any questions, oiease call me at 713 953.5096. in'! erely a/ james D. Ross, PE Pnofreer fr)r the Zone iD, RfAl Atlacl,ment Shadow Creek Rank -Ili Town Center Improvements Letter Finance Agreement # 07-03-002 !ten-jizeu .11-A"eakdown of Costs -76CZ'- .1n t:N it J 2 1); 7 7i{iJ5 8 Items INFRASTRUCI'URE Major Road infrastructure 5.,,,r ess Carter DrIve P�jvjrxj N"i-e-ri'n; ial H;,.rrnafm D1 vf,' Paving Landscaping (includes corttinegencies & erig.) Buslrle�;s DT!ve Memorz,x Herrr.ann D'nye DetentionlDrainaqe Laro ri Overhead Utilities Placed Underground Pipeline Relocation Engineering Approved Budget Approved Budget (Adjusted per ENR (2006 Dollars) Index) $ 157.FW $ 1(2.015 67,500 $ 69.435 200.000 $ 1,234.399 Subtotal $ Plan Amendment Costs $ 180 "Ili? Subtotal $ 75. 0 10 0 c 180 ()17 TOTAL S 1,8007000 $ 1,8511598 7129::',`�If'Q� Totiv Actual Costs S $ 4 203, I H 5. 8,17 2 Ls PC, me Letter Of FirlarCe eirribursernent is imited to t`lve least': ---)i the actual costs nr 1hii: apprGvav, t.udge? !.1.*,TM adpsted for Inflation, 11 Greenway Plaza, Suite 1515 Houston, TX 77046 (713) 621-1515 Fax: (713) 621-1570 Al NuIIlairson CERTRED KFA IC ACCOUNTANTS PROFF_SSK?NAL COP( OWIFION Exhibit "B" Auditor's Report RTIRZ-2008-02 One Sugar Creek Blvd., Suite 920 Sugar Land, TX 77478 (281)242-8600 Fax: (281) 242-7333 July 31, 2008 D DA Reinvestment Zone No. Two, City of Pearland, Texas Attn: Chairman, Board of Directors C/o- City of Pearland, Texas 3519 Pearland Drive Pearland, Texas 77581 Re: Independent Accountants' Report - Completion of TIPZ improvements: Dear Mr. Chairman and Members of the Board: As the independent accountant for Reinvestment Zone No. Two, City of Pearland, Texas (the "Zone"), we have reviewed the completed documentation submitted by Shadow Creek Retail, L.P. (the "Sub Developer") relating to the construction of the TIRZ Improvements described by that Letter Financing Agreements noted on Schedule A (the "Letter Financing Agreements"). By the Letter Financing Agreement, the Sub Developer agreed to pre -finance the design and construction of the TIRZ improvements to be reimbursed in accordance with the Reimbursement Agreement between the City of Pearland (the "City"), the Zone and the Sub - Developer dated November 13, 2006 (the "Reimbursement Agreement"). Based upon our review of the payments made and of the certification of the Zone's Engineer, I conclude that the construction of the TIRZ Improvements was conducted and have been completed in compliance with the Reimbursement Agreement and the document entitled "TIRZ Implementation and Reimbursement Process" and are in order for reimbursement upon availability of funds. We therefore recommend that the Zone reimburse the Sub -Developer the amounts indicated on Schedule A for the funds advanced to the Zone for the design and construction of the TIRZ Improvements, which is within the TIRZ budget (adjusted for inflation) established in the Zone's Project Plan and Reinvestment Zone Financing Plan, as amended, for the TIRZ improvements. In accordance with the Zone's Project Plan and Reinvestment Zone Financing Plan, as amended, and the Reimbursement Agreement between the City, the Zone, and the Sub - Developer, "developer interest" on this advance shall be calculated at 6.50 percent per annum for up to five years on the Creation costs and five years from date of completion of construction of the TIRZ improvements. Based upon this rate of interest, interest due as of the date of the letter is indicated on Schedule A. SCHEDULE A TAX MCREMENT REINVESTMENT ZONE NO.2 CITY OF PEARLAND, TEXAS RECAPITULATION OF AMOUNTS DUE TO SHADOW CREEK RETAIL, L.P. As of July 31, 2008 MM Letter Finance Agreement LFA L FA actual (LFA) Date Amount Cost Interest * To Road infrastructure, pipeline relocation and site drainage 10/23/06 $ 9,949,618 $ 9,949,618 " $ 1,065,587 11'0 Landscaping, detention/drainage, relocation of overhead utilities and plan amendment costs 03/12/07 1,851,598 1,851,598 *** 113,137 1,91 $ 11,801,216 $ 11,801,216 $ 1,178,724 $ 12,9' ' Interest computed through July 31, 2008 at 6.50%. Actual interest will be calculated through the date of bond reimbursement. '* Actual costs were $11,487,664. Reimbursement is limited to lesser of actual costs or the amount per the LFA. * * * Actual costs were $1,861,809. Reimbursement is limited to lesser of actual costs or the amount per the LFA. Exhibit "C" Zone Administrator's Letter RTIRZ-2008-02 August 15, 2008 Pearland Reinvestment Zone No. Two Board of Directors 3519 Liberty Drive Pearland, TX 77581 Re: Completion of TIRZ Improvements — LFA's 06-10-001 and 07-03-002 Dear Board of Directors: I have reviewed the procedures followed by Shadow Creek Retail LP (the "Sub Developer") related to the implementation of the Zone projects referenced above. Pursuant to the Letter of Financing Agreement, the Sub -Developer agreed to pre -finance costs associated with the design and construction of these projects and to be reimbursed in accordance wit the Reimbursement Agreement between the City of Pearland, the Zone and the Master Developer dated November 13, 2006. Based upon my review of the TIRZ Project Implementation Plan and Reimbursement Process and the Letter of Financing Agreement and based upon the Engineer's letter stating that construction is complete and in order for reimbursement, I conclude that the above LFA's qualify for reimbursements. Sincerely, i Claire Bogard City of Pearland, TX Director of Finance 3519 LIBERTY DRIVE • PEARLAND, TEXAS 77581-5416 • 281-652-1600 • www.d.pearland.tx.us Exhibit °D" SCR Retail Letter RTIRZ-2008-02 REINVESTMENT ZONE NUMBER TWO CITY OF PEARLAND, TEXAS LETTER AGREEMENT ESTABLISHING PRIORITY FOR REIMBURSEMENT August 25, 2008 Shadow Creek Retail, LP Attn: Ty, Puckett 1900 West Loop South Suite 1300 Houston, Texas 77027 Re: Your Application for Reimbursement pursuant to Letter Financing Agreement Nos. 06-10-001 and 07-03-002 Dear Sir or Madam: The Board of Directors of Reinvestment Zone Number Two, City of Pearland, Texas, and its consultants, have received and reviewed your Application for Reimbursement of the above -referenced Letter Financing Agreements. At its meeting on August 25, 2008, the Board of Directors approved your Application for Reimbursement. The Board of Directors has submitted your approved Application for Reimbursement to the City of Pearland and the Development Authority of Pearland for reimbursement in accordance with the procedures established in the Agreement By and Between the City of Pearland, Texas, Reinvestment Zone Number Two, City of Pearland, Texas, and the Development Authority of Pearland, effective as of October 11, 2004. The Project reimbursement costs will now be logged for priority of reimbursement as established by the reimbursement approval date and the Project and Financing Plan. A copy of the Resolution Approving Recommendation for Reimbursement is attached. Sincerely, Chair, Board of Directors 2008. Agreed to and accepted by Shadow Creek Retail, LP this 25th day of August SHADOW CREEK RETAIL, LP, a Delaware limited partnership By: Shadow Creek Retail GP, LLC, a Delaware limited liability company, its General Partner By: k p� Name: tl,4�W4:� k PRi�SAV/N- Title: `f tc-E- Me:—, i i>=,WJ i ' CERTIFICATE FOR RESOLUTION THE STATE OF TEXAS § COUNTIES OF BRAZORIA AND FORT BEND § I, the undersigned officer of the Board of Directors of Reinvestment Zone Number Two, City of Pearland, Texas, hereby certify as follows: 1. The Board of Directors of Reinvestment Zone Number Two, City of Pearland, Texas, convened in regular session on the 25th day of August, 2008, at the regular meeting place thereof, and the roll was called of the duly constituted officers and members of the Board to -wit: Nigel Harrison Chair Gary Cook Vice Chair Mike Pyburn Secretary Jo Knight Director Ron Castillo Director Gary Davis Director Donna Coleman Director Larry Loessin Director Ken Phillips Director and all of said persons were present, except Director(s) Mike Pyburn and Ron Castillo, thus constituting a quorum. Whereupon, among other business, the following was transacted at the meeting: a written A RESOLUTION OF PEARLAND TAX INCREMENT REINVESTMENT ZONE #2 (TIRZ #2) APPROVING RECOMMENDATION FOR REIMBURSEMENT (LFA Nos. 06-10-001 and 07-03-002) was introduced for the consideration of the Board. It was then duly moved and seconded that the resolution be adopted, and, after due discussion, the motion, carrying with it the adoption of the resolution, prevailed and carried unanimously. 2. That a true, full and correct copy of the aforesaid Resolution adopted at the meeting described in the above and foregoing paragraph is attached to and follows this certificate; that the Resolution has been duly recorded in the Board's minutes of the meeting; that the persons named in the above and foregoing paragraph are the duly chosen, qualified and acting officers and members of the Board as indicated therein; that each of the officers and members of the Board was duly and sufficiently notified officially and personally, in advance, of the time, place and purpose of the aforesaid meeting, and that the Resolution would be introduced and considered for adoption at the meeting, and each of the officers and members consented, in advance, to the holding of the meeting for such purpose; that the meeting was open to the public as required by law; and that public notice of the time, place and subject of the meeting was given as required by applicable laws, including without limitation, Chapter 551, Texas Government Code. SIGNED this 25th day of August, 2008. OY5 Secretary, B and of D.erectors RTIRZ-2008-02 RESOLUTION NO. RTIRZ-2008-02 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE PEARLAND TAX INCREMENT REINVESTMENT ZONE NUMBER TWO (TIRZ #2) APPROVING RECOMMENDATION FOR REIMBURSEMENT (LETTER FINANCING AGREEMENT (LFA)NOS. 06-10-001 and 07-03-002) WHEREAS, Reinvestment Zone Number Two, City of Pearland, Texas (the "Zone") has been legally created by the City of Pearland, Texas (the "City"), pursuant to Chapter 311, Texas Tax Code; and WHEREAS, the City and Zone have approved the Zone's Project Plan and Reinvestment Zone Financing Plan, and amendments (the "Plan"); and WHEREAS, the City, the Zone and Shadow Creek Retail, LP entered into a Developer Reimbursement Agreement as of November 13, 2006, in order to implement a portion of the Plan and facilitate the development of the public improvements related to the project and described in the Plan and to provide reimbursement to Shadow Creek Retail, LP for costs and expenditures related to such improvements recommended for approval by the Board of Directors of the Zone (the "Board of Directors") from the Zone's engineer (the "Zone Engineer"), the Zone's auditor (the "Zone Auditor") and the consultants or City staff administering the affairs of the Zone (the "Zone Administrator"); and WHEREAS, the Shadow Creek Retail, LP and the Zone entered into two Letter Financing Agreements, dated March 12, 2007 and October 23, 2006 (collectively the "Letter Agreements") in which the Board of Directors approved construction of the specific TIRZ improvements described in the Letter Agreements and established a budget related to reimbursement (the "TIRZ Improvements"); and WHEREAS, the Shadow Creek Retail, LP has applied to the Zone (the "Application"), for reimbursement of Shadow Creek Retail, LP's costs and expenditures, plus interest, incurred in developing the TIRZ Improvements as described in and contemplated by the Letter Agreements; and WHEREAS, in response to the Shadow Creek Retail, LP's Application, the Zone Engineer, the Zone Auditor and the Zone Administrator have reviewed the Application and the TIRZ Improvements and have certified that the TIRZ Improvements are complete and are in order for reimbursement in accordance with the Application (the "Reimbursement"); and WHEREAS, the Zone Engineer's letters regarding the TIRZ Improvements are attached hereto and incorporated herein as Exhibit "A" (the "Engineer's Report"), and WHEREAS, the Zone Auditor's letter regarding the TIRZ Improvements is attached hereto and incorporated herein as Exhibit "B" (the "Auditor's Report"); and RTIRZ-2008-02.doc WHEREAS, the Zone Administrator's letter regarding the TIRZ Improvements is attached hereto and incorporated by reference herein as Exhibit "C" (the "Zone Administrator's Letter") (collectively, the Engineer's Report, Auditor's Report, and Administrator's Letter may be referred to as "Consultants' Reports"); Now, Therefore, BE IT RESOLVED BY THE BOARD OF DIRECTORS: Section 1. That the Board of Directors hereby approves the Consultants' Reports, and the Reimbursement, including but not limited to, the recommendations that the Shadow Creek Retail, LP be reimbursed for the expenditures enumerated or referenced in the Consultants' Reports plus interest as applicable. Section 2. That the Board of Directors hereby authorizes its Chair to execute the Letter Agreement Establishing Priority for Reimbursement relating to the TIRZ Improvements. Section 3. That the Board of Directors hereby approves the submittal of the Letter Agreements and Consultants' Reports to the City of Pearland, Texas for reimbursement in accordance with procedures established in the Agreement By and Between the City of Pearland, Texas, Reinvestment Zone Number Two, City of Pearland, Texas, and the Development Authority of Pearland, effective as of October 11, 2004. PASSED, APPROVED, AND ADOPTED this 25th day of August, A.D. 2008. NI EL HARRISON TIRZ CHAIR, BOARD OF DIRECTORS ATTEST: MIKE PYI§UkN TIRZ SECRETARY, LARD OF DIRECTORS RTTRL-2008-02.doc Exhibit "A" Engineer's Report RTIRZ-2008-02 LJA Engineering & Surveying, Inc. 7 G 4,3, - 3 7 0, 1 www iarilineerini.a.-ntr '>5.. 2008 Boand of Directors Reinvesiment Zone No. 2, City of Pearland, Texas ;Yo City of Pearland, Texas 3,519 Liberty Drive Pear4.,Ind. Texas 17581 Re Reinvestment Zone No. 2, City of Pearland, Texas Completion of TIRZ Improvements Described in the Letter Financing Agreement Dated October 23, 2006 ?!..A # 06- 10-00 1 - Road Infrastructure, Pipeline Relor.ation and Site DrFlinace L.11A job No. 1546-0000 (12,9' ) Dear Board of Directors: As .hey Engineer `car Reinvestment Zone No, 2, City of Peadand, Texas (the "Zone"), I have reviewed theornpleted docur-nentation submitted by Shadow Creek Retail, W.P. (the "Sub -Developer") ,elat - Ling to the TIRZ itnprovemerts described by the Letter Financing Agreement # 06- 10-001 dated October 23, 2006 (the "Letter Financing Agreement"), By the Letter Financing Agreement, the Sub- DeVrJ, GP,,.r agreeal to pre -finance the design and constru0ion of the TIRZ Improvements to be reirylbu , rsed in accordance, with the Reimbursement Agreement between the City of Pearland, the Zone. anwd the Sub -Developer dated November 13, 2006 +the "Reirnbursernent Agreement"). The I.eruer �irtancmg Agreement states that the budget (adjusted for inflation) established In the Zone'G ProJer.1 Plan and Reinvestment Zone Financing Plan, as amended, for the TIRZ improvernents, is $9,949,618 plus 'developer interest" calculated per the Reimbursement Agreement. rias provided, and I have reviewed. the necessary documentation to prove with all procedures set forth in the document entitled "TIRZ Project Implernlentation and ment Process' Based upon my review, I conclude that the construction of the TIRZ imwcvpments was conducted in compliance with the ReimDurserrient Agreement and the procedures set forth in the document entitled "TIRZ Project Implementation and Reimbursement Process', is complete and is in order for reimbursement, i therefore recommend that the- Zone reimburse the Sub -Developer the arnount of $9,949,618 for the funds advanced to the Zone for the TIRZ Improvements, plus "developer interest" calculated per the Reimbursement Agreement, as applicable. A detailed breakdown of the costs of the TIRZ improvements is attached to this letter. YOU have ally q qi-testions, please call me at 713.9.53.5096. 5�:rcereiy, �2, Jame,, D. Ross. PE -r'cqloeer for the; !,.one 0 ADRoll Ati-achmont Road Infrastructure, Pipeline Relocation and Site Drainage Letter Finance Agreement # 06-10-001 Iternized Breakdown of Costs 766r. Items INFRASTRUCTURE Major Road Infrastructure �3foacway Vviov-W"y Bus ness C'-*e-.1f,- Drive Pav!nq Mai—o".."it Hen-lann Drive Pavina landscaping (includes continegencies & eng.) ess C'��we- u.rlvz Detentioni'Dfainage i - LW,d Gcautl il,-'a-ion'Deepenin i'l-Pond Creation ge Overhead Utilities Placed Underground Pir*,hne Relocation Engineering Approved Budget Approved Budget (Adjusted per ENR (2006 Dollars) Index) 2.831,7KI 2,831 ' 789 $ 852.722 383, i 07 S 383.1 Q 7 2, 8 5'0, 0 G 0 $ 2,850,00,10 $ 11, e4 2,')( 1.14 2. 1 f 7110,000 S 70c"000 490 000 C. 400 000 Subtotal S 9:940,618 S !;A49,618 Plan Amendment Costs. S $ Subtotal S S TOTAL S 9,949,618 S 9,949,613 Total Actual Costs 334... 1,267 48 839,444 $ 3.374.275 $ 48 7 Po-', the'Leitpr of Finance Agreelner t reirnbursernen lic -)r t is !imited to the lesser of I, -tual c,,)sts or the aprlroyed 1):j-,iaj;t wn-ourl adli'stec', ?()r inf!afion. LJA Engineering & Surveying, Inc. ,,"1, 2" t Q,M3 MOO ,, -) B;�-yndfw i", V ax Texas !"'N'2-370513 wwm qaerigine�,rmq.com. July 21, 2008 Board of rL.-)irec-tors Reinvestment Zone No, 2, City of Pearland, Texas c,fo City of Pearland, Texas 3519 Liberty Drive Peatfand, Texas 77581 Reinvestment Zone No. 2, City of Pearland, Texas Completion of RZ Im.proverrients r, Described in the Letter Financing Agreement Dated March 12. 2007 L L FA# 0.7 -03-002 - Shadow Creek Ranch Town (-'enter Improvements LJAJob No. 1546-0000 (12 9) Dear Board of Directors. As the Engineer for Reinvestment Zone No. 2, City of Pearland, Texas "the 'Zone;), I have reviewed the completed documentation submitted by Shadow Creek Retail, I L.P. the 'Sub-D-eveiciper" , e,fating 10 ' the TIRZ Irniprovernents described by the Letter Financing Agroerrent. # 07-03-002 dated tvl-ifch 12; 2007 Lh)e tLetter Financing, Agreement'}. By the... Letter Financing Agreement, the 3jib- Do",iok?per to Ore -finance the design and construction of the TIR2 irnprovements to be IMbuis burled with the Reirnbursement Agreement between the City of Pearland. the ed in accordance Zonf= :4nd the Su`) -Developer dated November 13, 21006 (the "Reirribuisement Aqr'een11erJ' 1. The LetterPinancinq Agreement states that the Zone's Project Plan and Reinvestment Zone lmorovernents is $1,851.598 plus "developer Agreement, budget 'adjusted for inflations established In the Financing Plan, as arnended, for the TIRZ interest" calculated per the Reimburserner'll rhe Sub -Developer has provided, and 1 have reviewed, the necessary documentat;cn, to prove compliance with all prmodures set forth in the document entitled "TIRZ Protect Impterrientaticiii and Reirnbui,se-merit Procass', Based upon friv review, I conclude that the construction of the, TIRZ improvernerits was conducted in cornpha'nce with the Reimbursement Aqreerneri and the j )cedures set forth In the document entitled "TIRZ Project Implementation and Reirnbtursernent Process`. is complete and is in order for reimbursement. I therefore recommend that, the Zone reimburse the Sub -Developer the amount of $1,851,598 for the funds advanced to the Zone for the TIRZ Improvements, plus "developer interest*' calculated, per the Reimbursement Agreement, as applicable, A dol ailed breakdown of the costs of the TRZ improvements is attached to this letter yot.i have any quesiiotls, please call me at 713-9r 53.5096. jarries. J. Ross. PE Encnre-r for the t ,, Zone jDRAI Attac- hmen t Shadow Creek Ranch Town Center Improvements Letter Finance Agreement # 07-03-002 itemized Breakdown of Costs Items INFRASTRUCTURE Major Road Infrastructure V 00n1r)rq Landscaping (includes coritfnegencies & eng.) 3ussr=rgc C; ,,r':ta! nrsve Mcrnor*' Herr^anr Dnve Dat P rlti ott/Drai n ag e Lac(I Overhead Utilities Placed Underground Pipelittp Relocation Engineering Approved Budget Approved Budget (Adjusted per ENR (2006 Dollars) Index) C $ IS $ . A,7.500 $ ':. Et.;115 67,500 a 69.435 200,0010 S 205 7:j3 S 2l(?.vOsr S 4,234.39cr S - S Subtotal S 1.625,01Cliz Plan Amendment Costs S 75, 00 e 180, i'': 7 Subtotal a '75,C00 c 8C.04' TOTAL $ 1.800,000 S 1,851,598 Tatar Actual Costs E G; $ 1 v 54I2C S a - S S S61:aC;r P - he Letter 0t F. rin-cr- Afire-afrent. 'ekrnbursemernt ;s 'irnitted tc the ir;BSFr".' :fir the actual costs r.Yr !t e appr, ai' t? dgjt:>' %i 'S p;; nl etGit;:StE:.Yr t!litr"lttf.N3. .. 11 Greenway Plaza, Suite 1515 Houston, TX 77046 (713) 621-1515 Fax: (713) 621-1570 VL1 NuIIlairson CER IRR)PUBXACCOUNTANiS PKOFESSK)". CORPORAL ION Exhibit "B" Auditor's Report RTIRZ-2008-02 One Sugar Creek Blvd., Suite 920 Sugar Land, TX 77478 (281)242-8600 Fax: (281) 242-7333 July 31, 2008 Reinvestment Zone No. Two D 1RA"I FT City of Pearland, Texas Attn: Chairman, Board of Directors C/o- City of Pearland, Texas 3519 Pearland Drive Pearland, Texas 77581 Re: Independent Accountants' Report - Completion of TIRZ improvements: Dear Mr. Chairman and Members of the Board: As the independent accountant for Reinvestment Zone No. Two, City of Pearland, Texas (the "Zone"), we have reviewed the completed documentation submitted by Shadow Creek Retail, L.P. (the "Sub Developer") relating to the construction of the TIRZ Improvements described by that Letter Financing Agreements noted on Schedule A (the "Letter Financing Agreements"). By the Letter Financing Agreement, the Sub Developer agreed to pre -finance the design and construction of the TIRZ improvements to be reimbursed in accordance with the Reimbursement Agreement between the City of Pearland (the "City"), the Zone and the Sub - Developer dated November 13, 2006 (the "Reimbursement Agreement"). Based upon our review of the payments made and of the certification of the Zone's Engineer, I conclude that the construction of the TIRZ Improvements was conducted and have been completed in compliance with the Reimbursement Agreement and the document entitled "TIRZ Implementation and Reimbursement Process" and are in order for reimbursement upon availability of funds. We therefore recommend that the Zone reimburse the Sub -Developer the amounts indicated on Schedule A for the funds advanced to the Zone for the design and construction of the TIRZ Improvements, which is within the TIRZ budget (adjusted for inflation) established in the Zone's Project Plan and Reinvestment Zone Financing Plan, as amended, for the TIRZ improvements. In accordance with the Zone's Project Plan and Reinvestment Zone Financing Plan, as amended, and the Reimbursement Agreement between the City, the Zone, and the Sub - Developer, "developer interest" on this advance shall be calculated at 6.50 percent per annum for up to five years on the Creation costs and five years from date of completion of construction of the TIRZ improvements. Based upon this rate of interest, interest due as of the date of the letter is indicated on Schedule A. SCHEDULE A TAX LNCREMENT REINVESTMENT ZONE NO.2 CITY OF PEARLAND, TEXAS RECAPITULATION OF AMOUNTS DUE TO SHADOW CREEK RETAIL, L.P. As of July 31, 2008 Letter Finance Agreement LFA (LFA) Date Road infrastructure, pipeline relocation and site drainage 10/23/06 Landscaping, detention/drainage, relocation of overhead utilities and plan amendment costs 03/12/07 DRAFT LFA Actual Amount Cost Interest S 9,949,618 S 9,949,618 ** S 1,065,587 To 11,0 1,851,598 1,851,598 *** 113,137 1,9( S 11,801,216 S 11,801,216 $ 1,178,724 S 12,9' * Interest computed through July 31, 2008 at 6.501/6. Actual interest will be calculated through the date of bond reimbursement. * * Actual costs were $11,487,664. Reimbursement is limited to lesser of actual costs or the amount per the LFA. ***Actual costs were $1,861,809. Reimbursement is limited to lesser of actual costs or the amount per the LFA. Exhibit "C" Zone Administrator's Letter RTIRZ-2008-02 fir. 18�i August 15, 2008 Pearland Reinvestment Zone No. Two Board of Directors 3519 Liberty Drive Pearland, TX 77581 Re: Completion of TIRZ Improvements — LFA's 06-10-001 and 07-03-002 Dear Board of Directors: I have reviewed the procedures followed by Shadow Creek Retail LP (the "Sub Developer") related to the implementation of the Zone projects referenced above. Pursuant to the Letter of Financing Agreement, the Sub -Developer agreed to pre -finance costs associated with the design and construction of these projects and to be reimbursed in accordance wit the Reimbursement Agreement between the City of Pearland, the Zone and the Master Developer dated November 13, 2006. Based upon my review of the TIRZ Project Implementation Plan and Reimbursement Process and the Letter of Financing Agreement and based upon the Engineer's letter stating that construction is complete and in order for reimbursement, I conclude that the above LFA's qualify for reimbursements. Sincerely, Claire Bogard City of Pearland, TX Director of Finance 3519 LIBERTY DRIVE • PEARLAND, TEXAS 77581-5416 • 281-652-1600 • www.d.pearland.tx.us Exhibit "D" SCR Retail Letter RTIRZ-2008-02 REINVESTMENT ZONE NUMBER TWO CITY OF PEARLAND, TEXAS LETTER AGREEMENT ESTABLISHING PRIORITY FOR REIMBURSEMENT August 25, 2008 Shadow Creek Retail, LP Attn: Ty Puckett 1900 West Loop South Suite 1300 Houston, Texas 77027 Re: Your Application for Reimbursement pursuant to Letter Financing Agreement Nos. 06-10-001 and 07-03-002 Dear Sir or Madam: The Board of Directors of Reinvestment Zone Number Two, City of Pearland, Texas, and its consultants, have received and reviewed your Application for Reimbursement of the above -referenced Letter Financing Agreements. At its meeting on August 25, 2008, the Board of Directors approved your Application for Reimbursement. The Board of Directors has submitted your approved Application for Reimbursement to the City of Pearland and the Development Authority of Pearland for reimbursement in accordance with the procedures established in the Agreement By and Between the City of Pearland, Texas, Reinvestment Zone Number Two, City of Pearland, Texas, and the Development Authority of Pearland, effective as of October 11, 2004. The Project reimbursement costs will now be logged for priority of reimbursement as established by the reimbursement approval date and the Project and Financing Plan. A copy of the Resolution Approving Recommendation for Reimbursement is attached. Sincerely, Chair, Board of Directors 11: Agreed to and accepted by Shadow Creek Retail, LP this 2 5 t h day of A u g u s t SHADOW CREEK RETAIL, LP, a Delaware limited partnership By: Shadow Creek Retail GP, LLC, a Delaware limited liability company, its General Partner By: 'r-k 0 Name: MR041, % PRASATIK Title: 1 4 E PRQE I b k-A) 1