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R2001-0099 08-13-01 RESOLUTION NO. R2001-99 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS, AUTHORIZING THE CITY MANAGER OR HIS DESIGNEE TO ENTER INTO AN AGREEMENT WITH SHADOW CREEK RANCH MAINTENANCE ASSOCIATION AND SHADOW CREEK RANCH DEVELOPMENT COMPANY LIMITED PARTNERSHIP FOR THE MAINTENANCE OF CERTAIN IMPROVEMENTS ASSOCIATED WITH TAX INCREMENT REINVESTMENT ZONE NO. 2. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS: Section 1. That certain agreement by and between the City of Pearland, Shadow Creek Ranch Maintenance Association, and Shadow Creek Ranch Development Company Limited Partnership, a copy of which is attached hereto as Exhibit "A" and made a part hereof for all purposes, is hereby authorized and approved. Section 2. That the City Manager or his designee is hereby authorized to execute and the City Secretary to attest an agreement with Shadow Creek Ranch Maintenance Association and Shadow Creek Ranch Development Company Limited Partnership for the maintenance of certain improvements associated with Tax Increment Reinvestment Zone No. 2. PASSED, APPROVEDandADOPTEDthisthe 13 dayof August , A.D., 2001. '-- ~'")"7 ~ TOM REID MAYOR ATTEST: EG'RETARY v 1 RESOLUTION NO. R2001-99 APPROVED AS TO FORM: DARRIN M. COKER CITY ATTORNEY 2 MAINTENANCE AND USE AGREEMENT FOR TIRZ IMPROVEMENTS BETWEEN SHADOW CREEK RANCH MAINTENANCE ASSOCIATION, SHADOW CREEK RANCH DEVELOPMENT COMPANY LIMITED PARTNERSHIP TI-IE CITY OF PEARLAND, TEXAS This Maintenance and Use Agreement (the "Agreement") is made and entered into as of the 13th day of August, 2001, by and between the CITY OF PEARLAND, TEXAS (the "City"), a home rule municipality located in the counties of Brazoria, Harris, and Fort Bend, Texas, and SHADOW CREEK RANCH MAINTENANCE ASSOCIATION (the "Association"), a Texas non-profit corporation and SHADOW CREEK RANCH DEVELOPMENT COMPANY LIMITED PARTNERSHIP, (the "Master Developer"), a Nevada limited partnership. RECITALS The City created Reinvestment Zone Number Two, City of Pearland, Texas, a tax increment reinvestment zone created pursuant to Chapter 311 of the Texas Tax Code, as amended (the "Zone"), to provide for the construction of improvements, by the Master Developer, contained in the Zone's approved Project Plan and Financing Plan (the "TIRZ Improvements"). With the City's approval, upon completion of certain of the TIRZ Improvements the Master Developer will deed such TIRZ Improvements to the Association on behalf of the public. The Master Developer and the City have determined that it is in their best interests to grant to the Association the use of certain of the TIRZ Improvements in return for the Association assuming their maintenance as set forth in Section 2. The Association has determined that it is in its best interest to maintain these certain TIRZ Improvements in accordance with the responsibilities set forth in this Agreement in return for the right to use the TIRZ Improvements. AGREEMENT For and in consideration of the mutual promises, covenants and the benefits and obligations hereinafter set forth, the City of Pearland, Texas, Shadow Creek Ranch Maintenance Association and Shadow Creek Ranch Development Company Limited Partnership hereby agree and contract as follows: Section 1: Rights. (a) Use of TIRZ Improvements. The Master Developer hereby agrees to grant to the Association, as such improvements are completed and inspected and approved by the City, the fight to the use and enjoyment of all TIRZ Improvements [excluding schools, streets, water and sewer facilities and storm sewer facilities including inlets and outfalls] (the "Association TIRZ Improvements") by deeding such Association TIRZ Improvements to the Association. Examples of such Association TIRZ Improvements include, but are not limited to, lakes, channels, certain swimming pools and recreational centers, the hike and bike trial system, the greenbelts and parks, landscaping and monuments. The Association recognizes that the Association TIRZ Improvements constructed to provide drainage (the "Drainage Improvements") have the primary Houston 529889~_3 purpose of providing drainage, and not recreation, in accordance with the Shadow Creek Ranch Master Drainage Plan approved by the City. The City shall notify the Association in writing of any uses that interfere with its ability to use the Drainage Improvements for their intended purposes, and the Association hereby agrees that upon receipt of such notice, it will immediately cease ail such uses. In the event the Association does not cease such uses within 60 days of receipt of such notice, this Agreement shall terminate automatically. (b) Construction of Structures. In connection with the rights granted to the Association by the Master Developer, the Association shall have the right to construct recreational structures or facilities in, on or around the Association TIRZ Improvements; provided, however, prior to any construction, the Association shall obtain the written consent of the City to such construction and shall provide the City the following information in writing: (1) the proposed structure or facility to be constructed; (2) a plat or plan showing the location(s) of the proposed structure or facility; (3) the proposed date on which installation or construction will begin; and (4) proof that the structure meets the Shadow Creek Ranch Overall Design Criteria and Guidelines for Residential, Commercial and Multi-family Uses (the "Design Guidelines") and has been approved by the architectural control committee. Within 60 days of receipt of the information from the Association, the City will provide the Association with a written answer regarding whether the proposed structure or facility can be constructed without interfering with the purpose of the Association TIRZ Improvements. The City agrees that it shall not unreasonably withhold its consent and will consent to any proposed construction by the Association as long as the City determines that the proposed construction will not interfere with the primary purpose of the Association T][RZ Improvements. Section 2: Association's Obligations. (a) T1RZ Improvements. The Association, upon execution of this Agreement, shall assume the obligation and expense to operate, maintain and repair all Association TIRZ Improvements, once conveyed by deed from the Master Developer, for all purposes. During the City's approval process of the plans and specifications to construct any Association TIRZ Improvements, the Association must review the plans and specifications for the proposed Association TIRZ Improvements and certify, by signature upon the TIRZ Improvements' construction plans submitted for finai approvai by the City, that the Association TIRZ Improvements comply with the Design Guidelines. (b) Easement Enforcement. Upon request of the City, the Association shall take ail necessary steps to enforce the obligations of any public utility established in an easement over property in the Zone. Section 3: City's Obligations. The City shall not approve the construction plans for any Association TIRZ Improvement until the Association has approved the plans, as described in Section 2, evidencing the Association TIRZ Improvement's compliance with the Design Guidelines. Upon final inspection and approval of any Association TIRZ Improvement, the City shall send a letter to the Master Developer, in the form attached to this Agreement, and Houston_529889_3 -2- incorporated for ail purposes, as Exhibit "A," requesting it to deed the Association TIRZ Improvement to the Association for maintenance on behalf of the public. Section 4: Master Developer's Obligations. Upon receipt of the letter from the City described in Section 3, the Master Developer shall deed the completed and approved Association T1RZ Improvement to the Association for maintenance on behaif of the public. Section 5: Insurance. The Association shall secure comprehensive general liability insurance coverage relating to its use of the Association TIRZ Improvements in the minimum amount of $1,000,000, with additional umbrella coverage in the minimum amount of $1,000,000. The Association shall keep such coverage current and shall provide a certificate of insurance evidencing same to the City. The City shall be added as an additional insured. Section 6: FOR AND IN CONSIDERATION OF THE MUTUAL PROMISES, COVENANTS AND THE BENEFITS AND OBLIGATIONS SET FORTH HEREIN, THE ASSOCIATION, FOR ITSELF, ITS OFFICERS, DIRECTORS, SHAREHOLDERS, PARTNERS, ADMINISTRATORS, LEGAL REPRESENTATIVES, SUCCESSORS AND ASSIGNS, HAS AGREED TO AND DOES HEREBY FULLY AND COMPLETELY INDEMNIFY AND HOLD THE CITY HARMLESS FROM EVERY CLAIM, ACTUAL LOSS, DAMAGE, INJURY, COST, EXPENSE, JUDGMENT OR LIABILITY SUSTAINED OR 1NCURRED BY OR BROUGHT AGAINST THE CITY, OF EVERY KIND OR CHARACTER WHATSOEVER, IN CONTRACT, TORT OR OTHERWISE, DIRECT OR INDIRECT, INCLUDING INCIDENTAL, SPECIAL AND CONSEQUENTIAL DAMAGES, FOR BODILY INJURY, DEATH, PROPERTY DAMAGE OR ECONOMIC LOSS IN CONNECTION WITH THE PLANNING, CONSTRUCTION/INSTALLATION, OPERATION, USE, OWNERSHIP AND/OR EXISTENCE OF THE ASSOCIATION'S RECREATIONAL FACILITIES. THIS INDEMNITY AND HOLD HARMLESS AGREEMENT RUNNING IN FAVOR OF THE CITY IS SPECIFICALLY INTENDED TO COVER ALL COSTS OF ANY FUTURE CLAIM OR LITIGATION, INCLUDING ATTORNEYS' FEES AND OTHER DEFENSE COSTS. FURTHERMORE, THIS INDEMNITY AND HOLD HARMLESS AGREEMENT RUNN1NG IN FAVOR OF THE CITY IS SPECIFICALLY INTENDED TO OPERATE AND BE APPLICABLE EVEN IF IT IS ALLEGED, CHARGED, OR PROVEN THAT ALL OR SOME OF THE FACTS, INCIDENTS, OR EVENTS COMPLAINED OF OR ALL OR SOME OF THE DAMAGES SOUGHT WERE SOLELY AND COMPLETELY CAUSED BY THE FAULT OR THE SOLE OR CONCURRENT NEGLIGENCE OF THE CITY, OF EVERY KIND OR CHARACTER WHATSOEVER, WHETHER AN AFFIRMATIVE ACT OR AN OMISSION, INCLUDING WITHOUT LIMITATION ALL TYPES OF NEGLIGENT CONDUCT IDENTIFIED IN THE RESTATEMENT (SECOND) OF TORTS. FINALLY, IT IS AGREED THAT NO STATUTE OF LIMITATIONS PERIOD OR PERIOD OF LACHES SHALL BEGIN TO RUN AGAINST THIS HOLD HARMLESS/INDEMNITY AGREEMENT UNTIL EACH CLAIM, DEMAND, OR CAUSE OF ACTION FOR WHICH HOLD HARMLESS OR INDEMNITY PROTECTION IS SOUGHT HAS BEEN ASSERTED AGAINST THE PARTY OR PARTIES SEEKING TO INVOKE THE PROTECTION OF THIS HOLD HARMLESS/INDEMNITY AGREEMENT AND UNTIL SUCH PARTY HAS RECEIVED WRITTEN NOTIFICATION OF SUCH CLAIM, DEMAND, OR CAUSE OF ACTION. Houston529889_3 -3- THESE CONTRACTUAL PROVISIONS RELIEVE ONE PARTY FOR RESPONSIBILITY IT WOULD OTHERWISE HAVE UNDER THE LAW FOR DAMAGES OR OTHER LIABILITY ARISING OUT OF THIS AGREEMENT. THE PARTIES HAVE NEGOTIATED IN GOOD FAITH TO ELIMINATE UNKNOWN AND ARBITRARY ASPECTS OF THEIR RELATIONSHIP AND TO ALLOCATE THE RISKS OF LOSS 1N A MANNER THAT IS COMMENSURATE WITH THE EXPECTED BENEFITS. THE PARTIES HAVE ATTEMPTED TO STATE THEIR AGREEMENT CLEARLY AND EXPRESSLY WITHIN THE FOUR CORNERS OF THIS INSTRUMENT. THE PARTIES AGREE THAT ALL PROVISIONS OF THIS CONTRACT ARE INTENDED TO APPLY EVEN 1~ THEY HAVE THE RESULT OF RELIEVING ONE PARTY FOR RESPONSIBILITY IT WOULD OTHERWISE HAVE UNDER THE LAW FOR ITS CONDUCT, INCLUDING ITS SOLE OR CONCURRENT NEGLIGENCE, OR FOR ANY DAMAGES OR LIABILITIES THAT WOULD OTHERWISE BE IMPOSED BY THE LAW 1N CONNECTION WITH THIS AGREEMENT. EACH PARTY AGREES AND COVENANTS THAT IT WILL NOT CONTEST THE ENFORCEABILITY OF ANY PROVISION OF THIS AGREEMENT UNDER THE "EXPRESS NEGLIGENCE" RULE AND EACH PARTY AGREES AND COVENANTS THAT IF A PROVISION OF THIS AGREEMENT IS NEVERTHELESS DEEMED BY A COURT TO BE SUBJECT TO THE "EXPRESS NEGLIGENCE" RULE AND THAT 117 THE PROVISION IS AMBIGUOUS, SUCH PROVISION WILL NOT BE DECLARED UNENFORCEABLE. INSTEAD, SUCH AMBIGUOUS PROVISION SHALL BE ENFORCED IN ACCORDANCE WITH THE COMMERCIAL AND ECONOMIC TERMS OF THE PARTIES' OVERALL AGREEMENT AND, TO THAT END, ORAL TESTIMONY AND OTHER WRITINGS SHALL BE CONSIDERED BY THE COURT OR JURY TO DETERMINE THE INTENT OF THE PARTIES WITH RESPECT TO SUCH PROVISION. Section 7: Association Default. In the event the Association does not, in the opinion of the City, satisfactorily maintain said Association TIRZ Improvements in accordance with its obligations set forth in this Agreement, or adequately insure the Association TIRZ Improvements, the City or the Master Developer shall have the right to terminate this Agreement upon 60 days written notice; provided, however, the Association shall have this 60 day time period to cure the default to the satisfaction of the City. Section 8~: Consideration. The City, the Master Developer and the Association agree that this Agreement is being entered into as an in4ucement for the Master Developer and the City to relinquish the right to the use and enjoyment Of the Association TIRZ Improvements and for the Association to accept the permanent operation and maintenance of the Association TIRZ Improvements. Section 9: Benefits to Parties. While the provisions of this Agreement are, in part, intended to establish as between the parties hereto, an acceptable manner of providing proper maintenance of the Association TIRZ Improvements that will serve the residents of the land within the boundaries of the City, this Agreement shall be for the sole and exclusive benefit of the Association, the Master Developer and the City, and shall not be construed to confer any benefit or right upon any other party. Houston_529889_3 -4- Section 10: Assignability. This Agreement is not assignable by any party hereto except with the written consent of all parties, which consent shall not be unreasonably withheld or unduly delayed. Section 11: Merger Clause. This Agreement constitutes the entire agreement between the parties relative to the subject matter hereof. There have been and are no agreements, covenants, representations or warranties between the parties other than those expressly stated or provided for herein. Section 12: Term. This Agreement shall be for a period of 99 years from the date first written above; provided, however, if the Association fails to comply with the respongibilities and obligations in this Agreement, the Master Developer and the City shall have the right to terminate the Agreement as provided in Section 7, hereof. The Agreement shall renew at the end of the initial term for one year periods unless terminated by mutual written consent of the parties. Section 13: Amendment. This Agreement shall not be amended, revised or changed without the written consent of all parties, which consent shall not be unreasonably withheld or unduly delayed. Section 14: Enactment Clause; Law. Each party hereby agrees that it will take all actions and execute all documents necessary to carry out the purposes and intent of this Agreement. This Agreement shall be governed by the laws of the State of Texas. [EXECUTION PAGE FOLLOWS] Houston_529889_3 -5 - 1N WITNESS WHEREOF, the parties have executed this Agreement in multiple copies, each of which shall be deemed an original as of the date and year first written above. ;riie CITY OF PEARLAND, TEXAS By: ~-~ ATTEST: City Manager By: (~~~J~f APPROVED AS TO FORM: City Attorney ~- SHADOW CREEK RANCH MAINTENANCE AS SOCIATION a Texas non-profit corporation ~Board of irectors SHADOW CREEK RANCH DEVELOPMENT COMPANY LIMITED PARTNERSHIP, a Nevada limited partnership By: SHADOW CREEK RANCH, INC., President Houston_529889 3 -6- Exhibit "A" City of Pearland, Texas [Date] Shadow Creek Ranch Development Company Limited Partnership Attn: Gat5, Cook 2947 East Broadway, Suite 304 Pearland, Texas 77581 Re: Final Inspection and Approval of the Association TIRZ Improvement described in the Letter Financing Agreement dated , __; TIRZ Project No. Dear'Mr. Cook: The [Name of Improvement] has been completed and is ready for acceptance for permanent maintenance. The City has received Shadow Creek Ranch Maintenance Association's (the "Association's"). approval of the above mentioned Association TIRZ Improvement and confirmation of their compliance with the Shadow Creek Ranch Overall Design Criteria and Guidelines for Residential, Commercial and Multi-family Uses. According to the terms of the Maintenance and Use Agreement for TIRZ Improvements dated August 13, 2001, the City hereby requests the immediate conveyance of the above referenced Association TIRZ Improvement to the Association for permanent maintenance on behalf of the public. Very truly yours, City Manager Houston529889 3 -7-