Ordinance No. 10,699ORDINANCE NO. 10,699
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF BAYTOWN,
TEXAS, AUTHORIZING AND DIRECTING THE CITY MANAGER TO
EXECUTE AND THE CITY CLERK TO ATTEST TO DEVELOPMENT
AGREEMENTS FOR THE CONSTRUCTION OF A TRAFFIC LIGHT ON
GARTH ROAD AND INDEPENDENCE BLVD.; AND PROVIDING FOR THE
EFFECTIVE DATE THEREOF.
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN,
TEXAS:
Section 1: That the City Council of the City of Baytown, Texas, hereby authorizes
and directs the City Manager to execute and the City Clerk to attest to a Development Agreement
with (i) Reinvestment Zone Number One, City of Baytown, Texas, (ii) the Baytown
Redevelopment Authority, and (iii) Baytown Plaza Two, L.P. for 50% of the funding of the
design and installation of a traffic signal at Garth Road and Independence Blvd. A copy of the
Agreement is attached hereto as Exhibit "A," and made a part hereof for all intents and purposes.
Section 2: That the City Council of the City of Baytown, Texas, hereby authorizes
and directs the City Manager to execute and the City Clerk to attest to a Development Agreement
with (i) Reinvestment Zone Number One, City of Baytown, Texas, and (ii) the Baytown
Redevelopment Authority for 50% of the funding of the design and installation of a traffic signal
at Garth Road and Independence Blvd. A copy of the Agreement is attached hereto as Exhibit
"B," and made a part hereof for all intents and purposes.
Section 3: This ordinance shall take effect immediately from and after its passage by
the City Council of the City of Baytown. 7
INTRODUCED, READ and PASSED by the affirmat^vfe vote of the City Council of the
City of Baytown this the 13lh day of September, 2007.
ST/EPHEim DONCARLOS, Mayor
APPROVED AS TO FORM:
JACIO RAMIREZ, SR^City Attorney
R:Karen\Files\Cily Council\Ordinances\2007\Seplember l3\TIRZDcvelopmenlAgrccmcntOrdiiiance.doc
DEVELOPMENT AGREEMENT
This DEVELOPMENT AGREEMENT (this "Agreement "), dated J
2007, is made by and between REINVESTMENT ZONE NUMBER ONE, CITY OF
BAYTOWN, TEXAS ( "Baytown Zone "), a tax increment reinvestment zone created by
the City of Baytown, Texas (the "City") pursuant to Chapter 311 of the Texas Tax Code,
as amended, acting by and through its governing body, the Board of Directors (the
"Zone Board "), BAYTOWN REDEVELOPMENT AUTHORITY ( "Baytown Authority "), a
local government corporation created and organized under the provisions of the Texas
Transportation Corporation Act, Chapter 431, Transportation Code, and authorized and
approved by the City under Resolution No. 1516 adopted on October 25, 2001, acting
by and through its governing body, the Board of Directors (the "Baytown Board "), THE
CITY OF BAYTOWN, TEXAS (the "City"), a Texas home -rule city, and BAYTOWN
PLAZA TWO, L.P. (the "Developer ").
RECITALS
WHEREAS, by Ordinances No. 9197 and 9275 and by Resolution 1516 the City
Council of the City created the Baytown Zone in the City pursuant to Chapter 311 of the
Texas Tax Code, as amended, and pursuant to a Preliminary Project Plan and
Preliminary Reinvestment Zone Financing Plan, and appointed its Board of Directors
( "TIRZ Ordinance "); and
WHEREAS, by Ordinance No. 9275, the City Council of the City enlarged the
Baytown Zone in the City pursuant to Chapter 311 of the Texas Tax Code, as amended,
and pursuant to a Preliminary Project Plan and Preliminary Reinvestment Zone
Financing Plan, and appointed its Board of Directors ( "TIRZ Ordinance "); and
WHEREAS, the Zone Board adopted a final Project Plan and Reinvestment Zone
Financing Plan (the "Project Plan ") and submitted the final Project Plan to the City
Council of the City for approval; and
WHEREAS, the City Council approved the final Project Plan by Ordinance No.
9290; and
WHEREAS, the City authorized the creation of the Baytown Authority to aid,
assist and act on behalf of the City in the performance of the City's governmental
functions with respect to the common good and general welfare of Baytown and
neighboring areas as described in the TIRZ Ordinance; and
WHEREAS, the City, the Baytown Zone and the Baytown Authority have entered into
that certain Agreement dated November 24, 2001, and approved as Ordinance No. 9271
(the "Baytown Agreement "), pursuant to which the City and the Baytown Zone
Development Agreement 218 -1- )
contracted with the Baytown Authority to administer the Baytown Zone including, but
not limited to, the power to engage in activities relating to the acquisition and
development of land, to construct and improve infrastructure in Baytown, to enter into
development agreements with Developer /builders in Baytown, and to issue, sell or
deliver its bonds, notes or other obligations in accordance with the terms of the
Baytown Agreement upon the approval of the City Council of the City; and
WHEREAS, the Baytown Agreement further provides that the Baytown
Authority must obtain the prior approval of the City for any project approved in the
Baytown Zone's Project Plan that is constructed or caused to be constructed by the
Baytown Authority; and
WHEREAS, the Texas Tax Code provides that the Baytown Zone may enter into
agreements as the Zone Board considers necessary or convenient to implement the
Project Plan and achieve its purposes; and
WHEREAS, the Baytown Board and the Zone Board have determined that it is in
the best interest of the Baytown Zone and the Baytown Authority to contract with
Developer to provide for the efficient and effective implementation of certain aspects of
the Project Plan; and
WHEREAS, the Developer desires to proceed with the development of an urban
project consisting of design and construction of traffic signals on land located within the
Baytown Zone to improve infrastructure in Baytown (the "Public Improvements') prior
to the time that the Baytown Authority can issue its bonds or incur other obligations to
pay the costs of the Public Improvements (as defined herein); and
WHEREAS, the City is willing to act as project manager for the Public
Improvements; NOW THEREFORE,
AGREEMENT
For and in consideration of the mutual promises, covenants, obligations, and
benefits of this Agreement, the Baytown Zone, the Baytown Authority, the City, and
the Developer contract and agree as follows:
ARTICLE 1
GENERALTERMS
1.1 Definitions. The terms "Agreement," "City," 'Baytown Agreement,"
"Baytown Board," 'Baytown Authority," "Developer," "Baytown Zone," "Developer," and
"Zone Board" have the above meanings, and the following terms have the following
meanings:
unzo
"Act" shall mean the Tax Increment Financing Act, Chapter 311, Texas Tax Code,
as amended.
"Atnthority Bonds" shall mean the Baytown Authority's tax increment revenue
bonds issued in one or more series pursuant to Section 6.1(H) of this Agreement.
"Available Tax Increment" shall mean funds in the Tax Increment Revenue Fund.
"Baytown" shall mean all of the property located within the boundaries of the
Baytown Zone.
"Completion" shall mean completion of construction of the Public Improvements
in accordance with the Plans and Specifications. Completion shall be approved by the
City and certified as to final completion by the engineering firm engaged by the City to
make such certification.
"Developer Advance" shall mean any funds advanced for eligible improvements
by the Developer pursuant to Section 6.1 of this Agreement and shall include any
interest payable thereon as prescribed in this Agreement.
"Effective Date" means the effective date of this Agreement, being the earlier of
either the date of this Agreement or the effective date of an agreement whereby the
Authority and another party agrees to fund the portion of the costs of the Public
Improvements not funded by this Agreement.
"Parties" or "Party" shall mean the City, the Baytown Zone, the Baytown
Authority, and the Developer.
"Plans and Specifications" shall mean the designs, plans and specifications for the
Public Improvements prepared or to be prepared by an engineering firm at the
direction of the City in accordance with the Project Plan.
"Pledged Available Tax Increment" shall mean one half of the Available Tax
Increment not otherwise payable by the Authority under another Development
Agreement, regardless of when such agreement is executed.
"Project Costs" shall mean the costs of the Public Improvement, including,
without limitation, all costs of design, engineering, materials, labor, construction, and
inspection, and all payments arising under any contracts entered into by the City
pursuant to this Agreement, all costs incurred in connection with obtaining
governmental approvals, certificates or permits (including any building permit fees)
required as a part of any contracts entered into in accordance with this Agreement and
all related legal fees incurred in connection therewith.
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"Project Plan" means the Project Plan and Reinvestment Zone Financing Plan for
Reinvestment Zone Number One, City of Baytown, as approved by the City Council on
December 13, 2001, and as thereafter amended and approved by the City Council.
"Public Improvements" shall have the meaning provided in Article 3 of this
Agreement.
"State" shall mean the State of Texas.
"Tax Increment Revenue Fund" shall mean the special fund established by the
Baytown Authority and funded with payments made by the City and any other
participating Taxing Units, pursuant to the Baytown Agreement.
"Taxing Unit" shall mean individually and collectively, the City and any other
taxing units participating in the Baytown Zone.
1.2 Sineular 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
2.1 Representation of Baytown Authority. The Baytown Authority hereby
represents to the Parties that:
(A) The Baytown Authority is duly authorized, created and existing in
good standing under the laws of the State and is duly qualified and authorized to carry
on the governmental functions and operations as contemplated by this Agreement.
(B) The Baytown Authority has the power, authority and legal right to
enter into and perform this Agreement and the execution, delivery and performance
hereof (i) have been duly authorized, (ii) to the best of its knowledge, will not violate
any applicable judgment, order, law or regulation, and (iii) do not constitute a default
under, or result in the creation of, any lien, charge, encumbrance or security interest
upon any assets of the Baytown Authority under any agreement or instrument to which
the Baytown Authority is a party or by which the Baytown Authority or its assets may
be bound or affected.
(C) The Public Improvements and the Project Costs are components of
or are consistent with the Project Plan.
145720
(D) This Agreement has been duly authorized, executed and delivered
by the Baytown Authority and, constitutes a legal, valid and binding obligation of the
Baytown Authority, enforceable in accordance with its terms except to the extent that (i)
the enforceability of such instruments may be limited by bankruptcy, reorganization,
insolvency, moratorium or other similar laws of general application in effect from time
to time relating to or affecting the enforcement of creditors' rights and (it) certain
equitable remedies including specific performance may be unavailable.
(E) The execution, delivery and performance of this Agreement by the
Baytown Authority does not require the consent or approval of any person which has
not been obtained.
(F) The Baytown Authority has an exemption from the payment of
sales and use taxes pursuant to the statute under which the Baytown Authority was
created.
2.2 Representation of Baytown Zone. The Baytown Zone hereby represents to
the Parties that:
(A) The Baytown Zone is duly authorized, created and existing in good
standing under the laws of the State and is duly qualified and authorized to carry on
the governmental functions and operations as contemplated by this Agreement.
(B) The Baytown Zone has the power, authority and legal right to enter
into and perform this Agreement and the execution, delivery and performance hereof
(i) have been duly authorized, (ii) to the best of its knowledge, will not violate any
applicable judgment, order, law or regulation, and (iii) do not constitute a default
under, or result in the creation of, any lien, charge, encumbrance or security interest
upon any assets of the Baytown Zone under any agreement or instrument to which the
Baytown Zone is a party or by which the Baytown Zone or its assets may be bound or
affected.
(C) The Public Improvements and the Project Costs are components of
or are consistent with the Project Plan.
(D) This Agreement has been duly authorized, executed and delivered
by the Baytown Zone and constitutes a legal, valid and binding obligation of the
Baytown Zone, enforceable in accordance with its terms except to the extent that (i) the
enforceability of such instruments may be limited by bankruptcy, reorganization,
insolvency, moratorium or other similar laws of general application in effect from time
to time relating to or affecting the enforcement of creditors' rights and (ii) certain
equitable remedies including specific performance may be unavailable.
wsno 5
(E) The execution, delivery and performance of this Agreement by the
Baytown Zone does not require the consent or approval of any person which has not
been obtained.
2.3 Representation of the City. The City hereby represents to the Parties that:
(A) The City is a Texas home -rule City duly incorporated under the
laws of the State and is duly qualified and authorized to carry on the governmental
functions and operations as contemplated by this Agreement.
(B) The City has the power, authority and legal right to enter into and
perform this Agreement and the execution, delivery and performance hereof (i) have
been duly authorized, (ii) to the best of its knowledge, will not violate any applicable
judgment, order, law or regulation, and (ill) do not constitute a default under, or result
in the creation of, any lien, charge, encumbrance or security interest upon any assets of
the City under any agreement or instrument to which the City is a party or by which the
City or its assets may be bound or affected.
(C) This Agreement has been duly authorized, executed and delivered
by the City and, constitutes a legal, valid and binding obligation of the City, enforceable
in accordance with its terms except to the extent that (i) the enforceability of such
instruments may be limited by bankruptcy, reorganization, insolvency, moratorium or
other similar laws of general application in effect from time to time relating to or
affecting the enforcement of creditors' rights and (ii) certain equitable remedies
including specific performance may be unavailable.
(D) The execution, delivery and performance of this Agreement by the
City does not require the consent or approval of any person which has not been
obtained.
(E) The City has an exemption from the payment of sales and use taxes
pursuant to the statute under which the City was created.
2.4 Representations of Develop. Developer hereby represents to the Parties
that:
(A) Developer is duly authorized, created and existing in good
standing under the laws of the State, is qualified to do business in the State.
(B) Developer has the power, authority and legal right to enter into
and perform its obligations set forth in this Agreement, and the execution, delivery and
performance hereof, (i) have been duly authorized, (ii) will not, to the best of its
knowledge, violate any judgment, order, law or regulation applicable to Developer or
any provisions of Developer's by -laws or limited partnership agreement, and (iii) do
145720 6
not constitute a default under or result in the creation of, any lien, charge, encumbrance
or security interest upon any assets of Developer under any agreement or instrument to
which Developer is a party or by which Developer or its assets may be bound or
affected.
(C) Developer will have sufficient capital to perform its obligations
under this Agreement at the time it needs to have sufficient capital.
(D) This Agreement has been duly authorized, executed and delivered
and constitutes a legal, valid and binding obligation of Developer, enforceable in
accordance with its terms except to the extent that (i) the enforceability of such
instruments may be limited by bankruptcy, reorganization, insolvency, moratorium or
other similar laws of general application in effect from time to time relating to or
affecting the enforcement of creditors' rights and (ii) certain equitable remedies
including specific performance may be unavailable
ARTICLE 3
THE PUBLIC IMPROVEMENTS
3.1 Public Improvements. The Public Improvements shall be and include the
design, construction and installation of a traffic signal and related improvements at the
South entrance to the San Jacinto Mall at the intersection of Garth and Independence
Roads, within the Baytown Zone, such infrastructure being more particularly described
in the Plans and Specifications (the "Public Improvements').
3.2 PJect Costs. The estimated Project Costs of the Public Improvements are
described in Exhibit A. The Public Improvements will be developed pursuant to the
Plans and Specifications as soon as practicable following the effective date of this
Agreement. The Project Costs may be modified with written approval of the Parties.
3.3 Obligation. The Public Improvements shall be designed, acquired,
constructed and implemented in accordance with the Plans and Specifications.
ARTICLE 4
DESIGN AND CONSTRUCTION
4.1 Construction Manager. Subject to receipt of the Developer Advance and
to execution of a reimbursement agreement between the Baytown Authority and the
Baytown Municipal Development District, the City agrees to cause to be designed and
constructed the Public Improvements and to provide and furnish, or cause to be
provided and furnished, all materials and services as and when required in connection
with the construction of the Public Improvements. The City will obtain all necessary
permits and approvals from all other governmental officials and agencies having
jurisdiction, provide supervision of all phases of construction of the Public
145720
Improvements, provide periodic reports as requested and required by the Baytown
Authority of such construction to the Baytown Authority, and cause the construction to
be performed in accordance with the Plans and Specifications.
4.2 Design of the Public Improvements. The City shall prepare or cause to be
prepared the Plans and Specifications for the Public Improvements.
4.3 Accounting Upon Completion. Within 90 days after the final completion
of the construction of the Public Improvements and acceptance of the same by the City
Council of the City of Baytown, the City shall provide the Parties with a final cost
summary of all costs associated with the Public Improvements.
4.4 Conveyance of Easements. If applicable, the Developer shall grant the
City all required temporary construction and access easements necessary to maintain
the Public Improvements. If applicable, the Developer will grant a permanent easement
to the City for the land on which the Public Improvement will be constructed. The
easements granted must be satisfactory for the intended purpose as determined by the
City.
4.5 Cooperation. The Parties agree that they will cooperate with each other
and provide all necessary information to the Baytown Authority and its consultants in
order to assist the Baytown Authority in complying with the Baytown Agreement,
including, without limitation, the completion of the audit and construction audit
required therein.
ARTICLE 5
DUTIES AND RESPONSIBILITIES OF THE BAYTOWN AUTHORITY
5.1 Mown Authority Contributions. The Baytown Authority shall pay or
reimburse to the Developer the Project Costs in the amount of one -half of the actual
costs of the Public Improvements as more particularly described in and as provided by
Articles 3 and 4. The total, actual Project Costs of the Public Improvements, for which
the Baytown Authority shall be responsible under the terms of this Agreement, is
estimated to be $150,000, and the total costs are estimated to be $300,000. Project Costs
of the Public Improvements in excess of $150,000 shall be paid by or on behalf of other
developers or other entities. Attached hereto as Exhibit A is a description of the
engineering estimates of the Public Improvements. The Project Costs shall be financed
and funded in accordance with Article 6 hereof. In the event a portion of the Public
Improvements is determined to be ineligible under the Act, the Project Costs shall be
reduced by the amount of such ineligible Public Improvements. If the Baytown
Authority has already repaid the Developer for such ineligible Public Improvements in
accordance with this Agreement, the Parties agree that the Developer shall reimburse
the Baytown Authority for such repayment within 30 days of receipt of an invoice from
the Baytown Authority and all such sums shall bear interest at the rate established in
1457M
section 6.1(F) from the date past due until the date of such reimbursement. Should the
Developer fail to timely pay such amount, the Baytown Authority may, in its sole
discretion, withhold the amount due, including accrued interest, from future payments.
5.2 Project Costs. The Baytown Authority shall reimburse the entire Project
Costs in accordance with this Agreement, up to the amount of the Developer Advance.
ARTICLE 6
PUBLIC IMPROVEMENTS FINANCING AND FUNDING
6.1 Developer Advance.
(A) Within 30 days of notice to the Developer of the Effective Date, the
Developer will deposit $150,000.00 with the City to cover half the estimated Project
Costs. Upon completion of the Public Improvements, as described in Section 4.3 of this
Agreement, a full accounting will be taken and any remaining funds from the
Developer's Advance in excess of one half of the Project Costs will be remitted to the
Developer, the balance of Developer's Advance being hereafter referred to as the "Net
Advance".
(B) After completion of the Public Improvements, the Baytown
Authority, at its expense, shall hire a certified public accountant to calculate the amount
due the Developer and shall prepare and submit a report to the Baytown Board and
send a copy to the City Manager. Interest (as defined in Subsection 6.1(F)) on the
Developer Advance made pursuant to this Subsection shall accrue from the date the
Developer Advance until two years after the completion of the Public Improvements;
provided that, in any event, interest shall accrue for no more than three and one -half
years. At such time as funds are available to pay all or any portion of the Developer
Advance made hereunder, the Baytown Authority, at its expense, shall hire a certified
public accountant to calculate the amount due the Developer and shall prepare and
submit a report to the Baytown Board and send a copy to the City Manager certifying
(1) the amount due the Developer for the Developer Advance being repaid with interest
calculated thereon as specified herein and (2) that funds are available to make such
payment. Upon receipt of such report, the Baytown Board shall promptly authorize
and make payment to the Developer.
(D) If, upon Completion of the Public Improvements, as described in
Section 4.3 of this Agreement, the Baytown Authority does not have sufficient funds to
reimburse to the Developer the remaining Net Advance, plus interest, for the Project
Costs, the Developer shall be deemed to have advanced to the Baytown Authority an
amount equal to the difference between (i) the amount of Net Advance made for the
Project Costs which has been previously repaid by the Baytown Authority to the
Developer and (ii) one -half of the final cost of the Public Improvements as evidenced by
documentation approved by the Baytown Board in accordance with Section 4.3.
145720 9
(E) The Baytown Authority shall begin repaying the Developer
Advance, and shall continue such repayment until repaid in full, on the earliest date
that funds are available from any of the following sources:
(1) proceeds from the sale of applicable Baytown Authority
Bonds; or
(2) the available Pledged Available Tax Increment Fund.
(F) Interest on the Developer Advance shall accrue at the prime rate of
JPMorgan Chase Bank, National Association. Interest shall be calculated on the basis of
a year of 360 days and the actual days elapsed (including the first day but excluding the
last day) occurring in the period for which such interest is payable, unless such
calculation would result in a usurious rate, in which case interest shall be calculated on
the per annum basis of a year of 365 or 366 days, as applicable, and the actual days
elapsed (including the first day but excluding the last day). In no case shall the interest
rate exceed one percent per month.
(G) The Baytown Authority's obligation to pay a Developer Advance is
limited to the Developer's portion of the Pledged Available Tax Increment. The rights
of the Developer in and to its Pledged Available Tax Increment granted herein are
subject only to (i) the rights of any holders of bonds, notes or other obligations that have
been heretofore or are hereafter issued by the City or any other participating taxing unit
that are payable from and secured by a general levy of ad valorem taxes throughout the
taxing jurisdiction of the City or any other participating taxing unit, (ii) the rights of any
of the holders of bonds and notes that are hereafter issued or incurred by the Baytown
Authority and which are secured by a pledge of the Pledged Available Tax Increment
Fund the proceeds of which are used to fully pay the Project Costs, including all
Developer Advance and accrued interest thereon as set forth in this Agreement, and (iii)
the rights of any of the holders of notes that are hereafter issued or incurred by the
Baytown Authority, which are secured by a pledge, all or a part, of the Pledged
Available Tax Increment Fund, the proceeds of which are used solely to fund the annual
operating and administration budget of the Baytown Authority approved by the
Baytown Board and the City Council of the City. Except in the event that sufficient tax
increment increase does not occur within the term of the Baytown Zone to generate
sufficient revenue to repay the Developer Advance, it shall be the obligation of the
Baytown Authority to repay the Developer Advance and accrued interest thereon as set
forth in this Agreement from the Pledged Available Tax Increment until such time as
the Developer Advance and accrued interest thereof incurred pursuant to this
Agreement, have been fully repaid or provision for payment thereon to the Developer
shall have been made in accordance with their terms. The Developer Advance
constitutes a special obligation of the Baytown Authority payable solely from the
Pledged Available Tax Increment as and to the extent provided in this Agreement. The
145720 10
Developer Advance does not give rise to a charge against the general credit or taxing
powers of the Baytown Authority, the Baytown Zone, the City, or any other Taxing Unit
and is not payable except as provided in this Agreement. The Developer, its successors
and assigns, shall not have the right to demand payment thereof out of any funds of the
Baytown Authority other than the Pledged Available Tax Increment or sources
described in Section 61(B).
(H) The Baytown Authority will evaluate and consider bond issues to
reimburse the Developer upon the following circumstances:
1) Projected incremental revenue generates 1.25 times coverage for the bonds
over projected annual debt service;
2) Projected incremental revenue will be calculated by multiplying estimated or
certified incremental value from the appraisal district by the participant(s) tax rate(s)
divided by 100 times one minus a reasonable historical tax collection factor times one
minus the City set aside percentage;
3) A reserve fund equal to maximum annual debt service must be funded from
the bond proceeds;
4) Adequate cash or capitalized interest must be set aside to assure payment of
the bonds through the date of the next increment payment;
5) The minimum bond size will be that size that after funding the Reserve Fund,
any capitalized interest and any costs of issuance will allow for a reimbursement to
developers of at least $1.5 million, plus developer interest.
(I) The Baytown Authority shall not issue obligations in accordance
with this Article unless the resulting debt service requirements on all Zone obligations
may be paid in full when due from all money then on deposit in or thereafter required
to be deposited to the Tax Increment Revenue Fund during the term of such Zone
obligations, assuming that (a) the rates at which property taxes are levied by all taxing
units required to make deposits to the Tax Increment Revenue Fund do not change
from the rates at which they most recently levied property taxes, (b) the assessed value
of taxable property (net of exemptions) within the Baytown Zone does not change from
the amount then most recently estimated or certified by the Harris County Appraisal
District, (c) all amounts deposited (or required to be deposited) to the Tax Increment
Revenue Fund bear interest at the City's investment rate until expended, (d) proceeds of
such obligations are deposited to and set aside as capitalized interest in the amount
approved by the City Manager, and (e) the Tax Increment Revenue Fund is expended in
each year to pay administrative expenses of the Zone in an amount equal to the product
of (i) the total amount of such expenses budgeted in the Zone's most recent operating
budget and (ii) a fraction, the numerator of which is the current Pledged Available Tax
Increment and the denominator of which is the total current Tax Increment.
145720 11
U) The Baytown Authority shall provide to the Developer, upon the
written request of the Developer, all information in its possession relevant to the
computation of the funds available for payment of the Project Costs and /or Pledged
Available Tax Increment Funds under this Section.
(K) The Baytown Zone and the Baytown Authority shall endeavor to
cause each Taxing Unit to collect all ad valorem taxes due on property located within
the Baytown Zone and shall endeavor to cause such Taxing Units to deposit all tax
increments due with the City for transfer to the Tax Increment Revenue Fund pursuant
to the Baytown Agreement.
ARTICLE 7
[RESERVED)
ARTICLE 8
DEFAULT
If a Party does not perform its obligations hereunder in compliance with this
Agreement in all material respects, in addition to the other rights given the City under
this Agreement, the other Parties may enforce specific performance of this Agreement
for any such default if such default is not cured or is not commenced and diligently
pursued within 90 days after receipt by the non - performing Party of a written notice
detailing the event of default. Failure of a project to generate sufficient tax increment
increase to repay Developer Advance is not a default on the part of the Baytown
Authority or the Baytown Zone.
ARTICLE 9
GENERAL
9.1 Inspections, Audits. The City shall allow the other Parties access to
documents and records in the City's possession, custody or control that the other
Parties deem necessary to assist them in determining the City' compliance with this
Agreement.
9.2 City' Operations and Employees. No personnel supplied or used by the
City in the performance of this Agreement shall be deemed employees, agents or
contractors of the other Parties for any purpose whatsoever. The City shall be solely
responsible for the compensation of all such personnel, for withholding of income,
social security and other payroll taxes and for the coverage of all worker's
compensation benefits. Under no circumstance shall the other Parties be deemed
responsible for compensation of the above.
145720 12
9.3 Personal Liability of Public Officials. To the extent not limited by State
law, no director, officer, employee or agent of the City, the Baytown Zone or the
Baytown Authority shall be personally responsible for any liability arising under or
growing out of this Agreement.
9.4 Notices. Any notice sent under this Agreement (except as otherwise
expressly required) shall be written and mailed via certified mail, return receipt
requested, or sent by electronic or facsimile transmission confirmed by mailing written
confirmation via certified mail, return receipt requested at substantially the same time
as such electronic or facsimile transmission, or personally delivered to an officer of the
receiving party at the following addresses:
CITY
City Manager
City of Baytown
P. O. Box 424
Baytown, Texas 77522 -0424
FAX: 281 - 420 -5891
with a copy to:
City Attorney
City of Baytown
P. O. Box 424
Baytown, Texas 77522 -0424
FAX: 281- 420 -5891
BAYTOWN ZONE
Reinvestment Zone Number One, City of Baytown,
c/o Hawes Hill Calderon L.L.C.
2500 Tanglewilde Street
Houston, Texas 77063
Attn: David Hawes
FAX: (713) 541 -0996
BAYTOWN AUTHORITY
Baytown Redevelopment Authority
c/o Hawes Hill Calderon L.L.P.
2500 Tanglewilde Street
Houston, Texas 77063
Attn: David Hawes
FAX: (713) 541 -0996
14nzo 13
DEVELOPER
Gulf Coast Commercial Management, Inc.
General Partner of Baytown Plaza Two, L.P.
3120 Rogerdale, Suite 150
Houston, Texas 77042
Attn: James L. Walker
FAX: (713) 532 -1969
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 electronic or facsimile
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, the other Parties, as the case may
be.
9.5 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
Parties. No course of dealing on the part of the Parties, nor any failure or delay by the
Parties with respect to exercising any right, power or privilege of the Parties under this
Agreement shall operate as a waiver thereof, except as otherwise provided in this
Section.
9.6 Successors and Assigns. All covenants and agreements contained by or
on behalf of the Developer, Baytown Authority or the Baytown Zone in this Agreement
shall bind their successors and assigns and shall inure to the benefit of the City and
their successors and assigns. Except as provided above, this Agreement may not be
assigned without the written permission of the other Parties.
9.7 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.
9.8 Construction. 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.
i4sno 14
9.9 Venue. All parties hereby irrevocably agree that any legal proceeding
arising out of or in connection with this Agreement shall only be brought in the District
Courts of Harris County, Texas or in the United States District Court for the Southern
District of Texas, in Houston, Texas.
9.10 Severability. All parties agree that should any provision of this
Agreement be determined to be invalid or unenforceable, such determination shall not
affect any other term of this Agreement, which shall continue in full force and effect.
9.11 No Third Party Beneficiaries. This Agreement shall not bestow any rights
upon any third party, but rather, shall bind and benefit the Parties hereto only.
9.12 No Partnership. Nothing herein contained shall be construed or held to
make the Parties hereto partners in the conduct of any business.
9.13 Entire Agreement. This written agreement represents the final agreement
between the parties, unless later amended in writing and signed by 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.
9.14 Ambiguities. In the event of any ambiguity in any of the terms of this
Agreement, it shall not be construed for or against any party hereto on the basis that
such party did or did not author the same.
9.15 Non - Waiver. Failure of either party hereto to insist on the strict
performance of any of the agreements contained herein or to exercise any rights or
remedies accruing hereunder upon default or failure of performance shall not be
considered a waiver of the right to insist on and to enforce by an appropriate remedy,
strict compliance with any other obligation hereunder or to exercise any right or
remedy occurring as a result of any future default or failure of performance.
9.16 Multiple Originals. It is understood and agreed that this Agreement may
be executed in a number of identical counterparts each of which shall be deemed an
original for all purposes.
9.17 Term. This Agreement shall be in force and effect from the Effective Date
for a term expiring on the later of (i) December 31 in the year following Completion of
the Public Improvements, as described in Section 4.3 of this Agreement, or (ii) the date
the Developer Advance has been repaid in full. If the Baytown Authority is dissolved,
the Baytown Agreement requires that the City shall make satisfactory arrangements to
provide for the payment of the obligations to the Developer of the Baytown Authority
hereunder.
i4n2a 15
9.18 ADProyal 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.
9.19 Additional Actions. The parties agree to take such actions, including the
execution and delivery of such documents, instruments, petitions and certifications as
may be necessary or appropriate, from time to time, to carry out the terms, provisions
and intent of this Agreement and to aid and assist each other in carrying out said terms,
provisions and intent.
[The remainder of this page is intentionally left blank]
145720 16
IN WITNESS WH EOF, the parties hereto have caused this instrument to be
duly execut�,SS of 2007.
CITY OF BAYTOWN. TEXAS
CitySecretary, LoP*i (oocil
APPROVED AS TO FORM I
REINVESTMENT ZONE NUMBER ONE, CITY OF BAYTOWN
By: -A
Name:
Title:
BAYTOWN REDEVELOPMENT AUTHORITY
Name:
Title:
14MO 17
BAYTOWN PLAZA, TWO, L.P.
By: Gulf Coast Commercial Management, Inc.,
its general partner
By:
Na e: 2ItP1°
T' te:
1asno 18
EXHIBIT A
The Public Improvements
Traffic Signal at Garth Road and Independence Road Estimated Cost: $300,000
Developer share: $150,000
1aszo 19
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Exhibit "B"
DEVELOPMENT AGREEMENT
This DEVELOPMENT AGREEMENT (this "Agreement?), dated
2007, is made by and between REINVESTMENT ZONE NUMBER ONE, CITY OF
BAYTOWN, TEXAS ("Baytown Zone"), a tax increment reinvestment zone created by
the City of Baytown, Texas (the "Citf) pursuant to Chapter 311 of the Texas Tax Code,
as amended, acting by and through its governing body, the Board of Directors (the
"2one Board"), BAYTOWN REDEVELOPMENT AUTHORITY ("Baytmm Authority"), a
local government corporation created and organized under the provisions of the Texas
Transportation Corporation Act, Chapter 431, Transportation Code, and authorized and
approved by the City under Resolution No. 1516 adopted on October 25, 2001, acting
by and through its governing body, the Board of Directors (the "Baytown Board"), and
THE CITY OF BAYTOWN, TEXAS (the "City"), a Texas home-rule dry.
RECITALS
WHEREAS, by Ordinances No. 9197 and 9275 and by Resolution 1516 the City
Council of the City created the Baytown Zone in the City pursuant to Chapter 311 of the
Texas Tax Code, as amended, and pursuant to a Preliminary Project Plan and
Preliminary Reinvestment Zone Financing Plan, and appointed its Board of Directors
{"TIRZ Ordinance"); and
WHEREAS, by Ordinance No. 9275, the City Council of the Gty enlarged the
Baytown Zone in the City pursuant to Chapter 311 of the Texas Tax Code, as amended,
and pursuant to a Preliminary Project Plan and Preliminary Reinvestment Zone
Financing Flan, and appointed its Board of Directors ("TIRZ Ordinance"); and
WHEREAS, the Zone Board adopted a final Project Plan and Reinvestment Zone
Financing Plan (the "Project Plan") and submitted the final Project Plan to the City
Council of the City for approval; and
WHEREAS, the City Council approved the final Project Plan by Ordinance No.
9290; and
WHEREAS, the City authorized the creation of the Baytown Authority to aid,
assist and act on behalf of the City in the performance of the City's governmental
functions with respect to the common good and general welfare of Baytown and
neighboring areas as described in the TIRZ Ordinance; and
WHEREAS, the City, the Baytown Zone and the Baytown Authority have
entered into Quit certain Agreement dated November 24, 2001, and approved as
Ordinance No. 9271 (the "Baytown Agreement?), pursuant to which the City and the
Baytown Zone contracted with the Baytown Authority to administer the Baytown Zone
including, but not limited to, the power to engage in activities relating to the acquisition
and development of land, to construct and improve infrastructure in Baytowa to enter
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into development agreements with Developer/builders in Baytown, and to issue, sell or
deliver its bonds, notes or other obligations in accordance with die terms of the
Baytown Agreement upon the approval of the City Council of the City; and
WHEREAS, the Baytown Agreement further provides that the Baytown
Authority must obtain die prior approval of the City for any project approved in the
Baytown Zone's Project Flan that is constructed or caused to be constructed by the
Baytown Authority; and
WHEREAS, the Texas Tax Code provides that the Baytown Zone may enter into
agreements as die Zone Board considers necessary or convenient to implement the
Project Plan and achieve its purposes; and
WHEREAS, the Baytown Board and the Zone Board have determined that It Is in
the best interest of the Baytown Zone and the Baytown Authority to contract with the
City to provide for the efficient and effective implementation of certain aspects of the
Project Plan; and
WHEREAS, the City desires to proceed with the development of an urban project
consisting of design and construction of traffic signals on land located within the
Baytown Zone to improve infrastructure in Baytown (the "Public Improvements") prior
to the time that die Baytown Authority can issue its bonds or incur other obligations to
pay the costs of die Public Improvements (as defined herein); and
WHEREAS, die City is willing to act as project manager for die Public
Improvements; NOW THEREFORE,
For and in consideration of die mutual promises, covenants, obligations, and
benefits of dus Agreement die Baytown Zone, die Baytown Auttiority, and die Gty,
contract and agree as follows:
ARTICLE 1
GENERAL TERMS
a
1.1 Definitions. The terms "Agreement," "Oty," "Baytown Agreement"
Baytown Board," " Baytown Authority" "Baytown Zone" and "Zone Board" have die
above meanings, and die following terms have die following meanings:
"Act" shall mean die Tax Increment Financing Act Chapter 311, Texas Tax Code,
as amended.
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"Authority Bonds" shall mean the Baytown Authority's tax increment revenue
bonds issued in one or more series pursuant to Section 6,1(F) of this Agreement.
"Available Tax Increment" shall mean funds in the Tax Increment Revenue Fund.
"Baytovm" shall mean all of the properly located within the boundaries of the
Baytown Zone.
"City Advance" shall mean any funds advanced for eligible improvements by die
City pursuant to Section 6.1 of this Agreement and shall include any interest payable
thereon as prescribed in this Agreement.
"Completion" shall mean completion of construction of the Public Improvements
in accordance with the Flans and Specifications. Completion shall be approved by the
Gty and certified as to final completion by the engineering firm engaged by the City to
make such certification.
"Effective Date" means the effective date of this Agreement, being the earlier of
either the date of this Agreement or the effective date of an agreement whereby the
Authority and another party agrees to fund the portion of the costs of the Public
Improvements not funded by this Agreement
"PartiaT or "Party" shall mean the City, the Baytown Zone, and tire Baytown
Authority.
"Plans and Specifications? shall mean the designs, plans and specifications for the
Public Improvements prepared or to be prepared by an engineering firm at the
direction of the City in accordance with the Project Flan.
"Pledged Available Tax Increment" shall mean one half of the Available Tax
Increment not otherwise payable by the Authority under another Development
Agreement, regardless of when such agreement is executed.
"Project Costs" shall mean the costs of the Public Improvement including,
without limitation, all costs of design, engineering, materials, labor, construction, and
inspection, and all payments arising under any contracts entered into by the City
pursuant to this Agreement, all costs incurred in connection with obtaining
governmental approvals, certificates or permits (including any building permit fees)
required as a part of any contracts entered into in accordance with this Agreement and
all related legal fees incurred in connection therewith,
"Project Plan" means the Project Plan and Reinvestment Zone Financing Plan for
Reinvestment Zone Number One, City of Baytown, as approved by the City Council on
December 13,2001, and as thereafter amended and approved by die City Council.
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"Public Improvements" shall have the meaning provided in Article 3 of this
Agreement
"SlateT shall mean the State of Texas.
"Tax Increment Revenue FundT shall mean the special fund established by the
Baytown Authority and funded with payments made by the City and any other
participating Taxing Units, pursuant to the Baytown Agreement
"Taxing Unif shall mean individually and collectively, the Gty and any other
taxing units participating in the Baytown Zone.
12 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
21 Representation of Bavtown Authority. The Baytown Authority hereby
represents to the Parties that:
(A) The Baytown Authority is duly authorized, created and existing in
good standing under the laws of the State and is duly qualified and authorized to carry
on the governmental functions and operations as contemplated by this Agreement.
(B) The Baytown Authority has the power, authority and legal right to
enter into and perform this Agreement and the execution, delivery and performance
hereof (i) have been duly authorized, (ii) to the best of its knowledge, will not violate
any applicable judgment, order, law or regulation, and (iii) do not constitute a default
under, or result in the creation of, any lien, charge, encumbrance or security interest
upon any assets of the Baytown Authority under any agreement or instrument to which
the Baytown Authority is a party or by which the Baytown Authority or its assets may
be bound or affected.
(Q The Public Improvements and the Project Costs are components of
or are consistent with the Project Plan.
(D) This Agreement has been duly authorized, executed and delivered
by the Baytown Authority and, constitutes a legal, valid and binding obligation of the
Baytown Authority, enforceable in accordance with its terms except to the extent that (i)
the enforceability of such instruments may be limited by bankruptcy, reorganization,
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insolvency, moratorium or other similar laws of general application in effect from time
to time relating to or affecting the enforcement of creditors' rights and (il) certain
equitable remedies including specific performance may be unavailable.
(E) The execution, delivery and performance of this Agreement by the
Baytown Authority do not require the consent or approval of any person which has not
been obtained.
(P) The Baytown Authority has an exemption from the payment of
sales and use taxes pursuant to the statute under which the Baytown Authority was
created.
2.2 Representation of Baytown Zone. The Baytown Zone hereby represents to
die Parties that
(A) The Baytown Zone is duly authorized, created and existing in good
standing under die laws of the State and is duly qualified and authorized to carry on
the governmental functions and operations as contemplated by mis Agreement
(B) The Baytown Zone has the power, authority and legal right to enter
into and perform mis Agreement and the execution, delivery and performance hereof
(i) have been duly authorized, (U) to the best of Its knowledge, will not violate any
applicable judgment order, law or regulation, and (iii) do not constitute a default
under, or result in the creation of, any lien, charge, encumbrance or security interest
upon any assets of the Baytown Zone under any agreement or Instrument to which the
Baytown Zone is a party or by which the Baytown Zone or its assets may be bound or
affected.
(Q The Public Improvements and the Project Costs are components of
or are consistent with the Project Plan.
P) This Agreement has been duly authorized, executed and delivered
by the Baytown Zone and constitutes a legal, valid and binding obligation of the
Baytown Zone, enforceable in accordance with its terms except to the extent that (i) the
enforceabllity of such instruments may be limited by bankruptcy, reorganization,
insolvency, moratorium or other similar laws of general application in effect from time
to time relating to or affecting the enforcement of creditors' rights and (ii) certain
equitable remedies including specific performance may be unavailable.
(E) The execution, delivery and performance of this Agreement by the
Baytown Zone do not require the consent or approval of any person which has not been
obtained.
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23 Representation of the City. The City hereby represents to the Parties that:
(A) The Gty is a Texas home-rule City duly incorporated under the
laws of the State and is duly qualified and authorized to carry on the governmental
functions and operations as contemplated by this Agreement.
(B) The City has the power, authority and legal right to enter into and
perform mis Agreement and the execution, delivery and performance hereof (i) have
been duly authorized, (ii) to the best of its knowledge, will not violate any applicable
judgment, order, law or regulation, and (Ui) do not constitute a default under, or result
in the creation of, any lien, charge, encumbrance or security interest upon any assets of
the Gty under any agreement or instrument to which the City is a party or by which the
Qty or its assets may be bound or affected.
(Q This Agreement has been duly authorized, executed and delivered
by the Gty and, constitutes a legal, valid and binding obligation of the Qfy, enforceable
in accordance with its terms except to the extent mat (I) the enforceability of such
instruments may be limited by bankruptcy, reorganization, insolvency, moratorium or
other similar laws of general application in effect from time to time relating to or
affecting the enforcement of creditors' rights and (ii) certain equitable remedies
including specific performance may be unavailable.
(D) The execution, delivery and performance of this Agreement by the
City do not require the consent or approval of any person which has not been obtained.
(E) The City has an exemption from the payment of sales and use taxes
pursuant to the statute under which the City was created.
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ARTICLE 3
THE PUBLIC IMPROVEMENTS
3.1 Public Improvements. The Public Improvements shall be and include the
design, construction and installation of a traffic signal and related improvements at the
South entrance to the San Jacinto Mall at the intersection of Garth and Independence
Roads, within the Baytown Zone, such infrastructure being more particularly described
in the Plans and Specifications (the "Public Improvements").
32 Project Costs. The estimated Project Costs of the Public Improvements are
described in Exhibit A. The Public Improvements will be developed pursuant to the
Plans and Specifications as soon as practicable following the effective date of this
Agreement The Project Costs may be modified with written approval of the Parties.
33 Obligation. The Public Improvements shall be designed, acquired,
constructed and implemented in accordance with the Plans and Specifications.
ARTICLE 4
DESIGN AND CONSTRUCTION
4.1 Construction Manager. Subject to receipt of the City Advance from the
Baytown Municipal Development District and to the receipt of the Developer Advance
from BAYTOWN PLAZA TWO, LJ>, the City agrees to cause to be designed and
constructed the Public Improvements and to provide and furnish, or cause to be
provided and furnished, all materials and services as and when required in connection
with the construction of the Public Improvements. The City will obtain all necessary
permits and approvals from all other governmental officials and agencies having
jurisdiction, provide supervision of all phases of construction of the Public
Improvements, provide periodic reports as requested and required by the Baytown
Authority of such construction to the Baytown Authority/ and cause the construction to
be performed in accordance with the Plans and Specifications.
4.2 Design of the Public Improvements. The City shall prepare or cause to be
prepared the Plans and Specifications for the Public Improvements.
4.3 Accounting Upon Completion. Within 90 days after the final completion
of the construction of the Public Improvements and acceptance of the same by the Qty
Council of the Qty of Baytown, the City shall provide the Parties with a final cost
summary of all costs associated with the Public Improvements.
4.4 Cooperation. The Parties agree that they will cooperate with each other
and provide all necessary information to the Baytown Authority and its consultants in
order to assist the Baytown Authority in complying with the Baytown Agreement,
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including, without limitation, me completion of the audit and construction audit
required therein.
ARTICLE 5
DUTIES AND RKPQNSIBIUTIES OF THE BAYTOWN AUTHORITY
5.1 Bavtown Authority Contributions. The Baytown Authority shall pay or
reimburse to the Qty the Project Costs in the amount of one-half of the actual costs of
the Public Improvements as more particularly described in and as provided by Articles
3 and 4. The total, actual Project Costs of the Public Improvements, for which the
Baytown Authority shall be responsible under the terms of this Agreement is estimated
to be $150,000, and the total costs are estimated to be $300,000. Attached hereto as
Exhibit A is a description of the engineering estimates of the Public Improvements. The
Project Costs shall be financed and funded in accordance with Article 6 hereof. In the
event a portion of the Public Improvements is determined to be ineligible under the Act,
the Project Costs shall be reduced by the amount of such ineligible Public
Improvements. If the Baytown Authority has already repaid the Qty for such ineligible
Public Improvements in accordance with this Agreement, the Parties agree that the Gty
shall reimburse the Baytown Authority for such repayment within 30 days of receipt of
an invoice from the Baytown Authority and all such sums shall bear interest at the rate
established in section 6.1(D) from the date past due untfl the date of such
reimbursement Should the City fail to timely pay such amount the Baytown Authority
may, in its sole discretion, withhold the amount due, including accrued interest from
future payments.
5.2 Project Costs. The Baytown Authority shall reimburse the entire Project
Costs in accordance with this Agreement up to the amount of the Qty Advance.
ARTICLE 6
PUBLIC IMPROVEMENTS FINANCING AND FUNDING
6.1 Citv Advance.
(A) After completion of the Public Improvements, the Baytown
Authority, at its expense, shall hire a certified public accountant to calculate the amount
due the City and shall prepare and submit a report to the Baytown Board and send a
copy to the Qty Manager. Interest (as defined in Subsection 6.1(D)) on the Qty
Advance made pursuant to this Subsection shall accrue from the date the Qty Advance
until two years after the completion of the Public Improvements; provided that in any
event interest shall accrue for no more man three and one-half years. At such time as
funds are available to pay all or any portion of the Qty Advance made hereunder, the
Baytown Authority, at its expense, shall hire a certified public accountant to calculate
the amount due the City and shall prepare and submit a report to the Baytown Board
and send a copy to the Qty Manager certifying (1) the amount due the Qty for the Qty
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Advance being repaid with interest calculated thereon as specified herein and (2) that
funds are available to make such payment. Upon receipt of such report, the Baytown
Board shall promptly authorize and make payment to (he City.
(B) If, upon Completion of the Public Improvements, as described in
Section 43 of this Agreement, the Baytown Authority does not have sufficient funds to
reimburse to the City the unpaid balance of the Project Costs, the City shall be deemed
to have advanced to the Baytown Authority an amount equal to the difference between
(i) one-half of the final cost of the Public Improvements as evidenced by documentation
approved by the Baytown Board in accordance with Section 43 and (ii) the amount of
the Project Costs which has been previously paid by the Baytown Authority to the City.
(Q The Baytown Authority shall begin repaying the City Advance, and
shall continue such repayment until repaid in full, on the earliest date that funds are
available from any of the following sources:
(1) proceeds from the sale of applicable Baytown Authority
Bonds; or
(2) the available Pledged Available Tax Increment Fund.
(D) Interest on the City Advance shall accrue at the prime rate of
JPMorgan Chase Bank, National Association. Interest shall be calculated on the basis of
a year of 360 days and the actual days elapsed (including the first day but excluding the
last day) occuning in the period for which such interest is payable, unless such
calculation would result in a usurious rate, in which case interest shall be calculated on
the per annum basis of a year of 365 or 366 days, as applicable, and the actual days
elapsed (including the first day but excluding the last day). In no case shall the interest
rate exceed one percent per month.
(E) The Baytown Authority's obligation to pay a City Advance is
limited to the Pledged Available Tax Increment The rights of the City in and to its
Pledged Available Tax Increment granted herein are subject only to (i) the rights of any
holders of bonds, notes or other obligations that have been heretofore or are hereafter
issued by the City or any other participating taxing unit that axe payable from and
secured by a general levy of ad valorem taxes throughout the taxing jurisdiction of the
City or any other participating taxing unit, (ii) the rights of any of the holders of bonds
and notes that are hereafter issued or incurred by the Baytown Authority and which are
secured by a pledge of the Pledged Available Tax Increment Fund the proceeds of
which are used to fully pay the Project Costs, including all City Advance and accrued
interest thereon as set forth in this Agreement, and (iii) the rights of any of the holders of notes that are hereafter issued or incurred by die Baytown Authority, which are
secured by a pledge, all or a part of the Pledged Available Tax Increment Fund, the
proceeds of which axe uaed solely to fund the annual operating and administration
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budget of the Baytown Authority approved by the Baytown Board and the Qty Council
of die City. Except in die event that sufficient tax Increment increase does not occur
within the term of the Baytown Zone to generate sufficient revenue to repay the City
Advance, it shall be the obligation of the Baytown Authority to repay the City Advance
and accrued interest thereon as set forth in this Agreement from the City's Pledged
Available Tax Increment until such time as the City Advance and accrued interest
thereof incurred pursuant to this Agreement have been fully repaid or provision for
payment thereon to the Qty shall have been made in accordance with their terms. The
Qty Advance constitutes a special obligation of the Baytown Authority payable solely
from the Fledged Available Tax Increment as and to the extent provided in this
Agreement. The Qty Advance does not give rise to a charge against the general credit
or taxing powers of the Baytown Authority, the Baytown Zone, the City, or any other
Taxing Unit and Is not payable except as provided in this Agreement The Qty, its
successors and assigns, shall not have the right to demand payment thereof out of any
funds of the Baytown Authority other than the Pledged Available Tax Increment or
sources described in Section 6J(C).
(F) The Baytown Authority will evaluate and consider bond issues to
reimburse the City upon the following circumstances:
1) Projected incremental revenue generates 1.25 times coverage for the bonds
over projected annual debt service;
2) Projected incremental revenue will be calculated by multiplying estimated
or certified incremental value from the appraisal district by the participants) tax rate(s)
divided by 100 times one minus a reasonable historical tax collection factor times one
minus the Qty set aside percentage;
3) A reserve fund equal to maximum annual debt service must be funded
from the bond proceeds;
4) Adequate cash or capitalized interest must be set aside to assure payment
of the bonds through the date of the next increment payment;
5) The minimum bond size will be that size that after funding the Reserve
Fund, any capitalized interest and any costs of issuance will allow for a reimbursement
to developers of at least $1.5 million, plus developer interest
(G) The Baytown Authority shall not issue obligations in accordance
with this Article unless the resulting debt service requirements on all Zone obligations
may be paid in full when due from all money then on deposit in or thereafter required
to be deposited to the Tax Increment Revenue Fund during the term of such Zone
obligations, assuming that (a) die rates at which property taxes are levied by all taxing
units required to make deposits to the Tax Increment Revenue Fund do not change
from the rates at which they most recently levied property taxes, (b) the assessed value
of taxable property (net of exemptions) within the Baytown Zone does not change from
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the amount then most recently estimated or certified by the Harris County Appraisal
District, (c) all amounts deposited (or required to be deposited) to the Tax Increment
Revenue Fund bear interest at the City's investment rate until expended, (d) proceeds of
such obligations are deposited to and set aside as capitalized interest in the amount
approved by the City Manager, and (e) the Tax Increment Revenue Fund is ap^fed in
each year to pay administrative expenses of the Zone in an amount equal to the product
of ffl the total amount of such expenses budgeted in the Zone's moat recent operating
budget and (ii) a fraction, toe numerator of which is the current Pledged Available Tax
Increment and the denominator of which is the total current Tax Increment
(H) The Baytown Authority shall provide to the City, upon the written
request of the Gty, all information in its possession relevant to the computation of the
funds for payment of the Project Costs under this Section.
(I) The Baytown Zone and the Baytown Authority shall endeavor to
cause each Taxing Unit to collect all ad valorem taxes due on property located within
the Baytown Zone and shall endeavor to cause such Taxing Units to deposit all tax
increments due with the City for transfer to the Tax Increment Revenue Fund pursuant
to the Baytown Agreement
ARTICLE 7
[RESERVED]
ARTICLE 8
DEFAULT
If a Party does not perform its obligations hereunder in compliance with this
Agreement in all material respects, in addition to the other rights given die City under
this Agreement, the other Parties may enforce specific performance of this Agreement
for any such default if such default is not cured or is not commenced and diligently
pursued within 90 days after receipt by the non-performing Party of a written notice
detailing the event of default Failure of a project to generate sufficient tax increment
increase to repay City Advance is not a default on the part of the Baytown Authority or
the Baytown Zone.
ARTICLE 9
9.1 Inspections. Audits. The City shall allow the omer Parties access to
documents and records in the City's possession, custody or control mat the omer
Parries deem necessary to assist them in determining the City* compliance with this
Agreement
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9.2 Citv* Operations and Employees. No personnel supplied or used by the
City in die performance of this Agreement shall be deemed employees, agents or
contractors of the other Parties for any purpose whatsoever. The City shall be solely
responsible for the compensation of all such personnel, for withholding of income,
social security and other payroll taxes and for the coverage of all workers'
compensation benefits. Under no circumstance shall the other Parties be deemed
responsible for compensation of the above.
9.3 Personal liability of Public Officials. To the extent not limited by State
law, no director, officer, employee or agent of the City, the Baytown Zone or the
Baytown Authority shall be personally responsible for any liability arising under or
growing out of this Agreement.
9.4 Notices. Any notice sent under this Agreement (except as otherwise
expressly required) shall be written and mailed via certified mail, return receipt
requested, or sent by electronic or facsimile transmission confirmed by mailing written
confirmation via certified mail, return receipt requested at substantially the same time
as such electronic or facsimile transmission, or personally delivered to an officer of the
receiving party at the following addresses:
CITY
City Manager
City of Baytown
P.O. Box 424
Baytown, Texas 77522-0424
FAX: 281-420-5891
With a copy to:
City Attorney
City of Baytown
P.O. Box 424
Baytown, Texas 77522-0424
FAX: 261-420-5891
BAYTOWN ZONE
Reinvestment Zone Number One, City of Baytown,
c/o Hawes Hill Calderon L.L.C.
2500 Tanglewilde Street
Houston, Texas 77063
Attru David Hawes
PAX: (713) 541-0996
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BAYTOWN AUTHORITY
Baytown Redevelopment Authority
c/o Hawes Hill Calderon LLP.
2500 Tanglewtlde Street
Houston, Texas 77063
Attru David Hawes
FAX: (713) 541-0996
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 electronic or facsimile
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, the other Parties, as the case may
be.
9.5 Amendments and Waivers. Any provision of mis Agreement may be
amended or waived if such amendment or waiver is in writing and is signed by the
Parties. No course of dealing on the part of the Parties, nor any failure or delay by the
Parties with respect to exercising any right, power or privilege of the Parties under this
Agreement snail operate as a waiver thereof, except as otherwise provided in this
Section.
9.6 Successors and Assigns. All covenants and agreements contained by or
on behalf of the Baytown Authority or the Baytown Zone in this Agreement shall bind
their successors and assigns and shall inure to the benefit of the City and its successors
and assigns. Except as provided above, this Agreement may not be assigned without
the written permission of the other Parties.
9.7 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 mis 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.
9.8 Construction. 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.
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9.9 Venue. All parties hereby irrevocably agree that any legal proceeding
arising out of or in connection with this Agreement shall only be brought in the District
Courts of Harris County/ Texas or in the United States District Court for the Southern
District of Texas, in Houston, Texas.
9.10 Severabaitv. All parties agree that should any provision of this
Agreement be determined to be invalid or unenforceable/ such determination shall not
affect any other term of mis Agreement, which shall continue in full force and effect
9.11 No Third Party Beneficiaries. This Agreement shall not bestow any rights
upon any third party, but rather, shall bind and benefit the Parties hereto only.
9.12 No Partnership. Nothing herein contained shall be construed or held to
make the Parties hereto partners in the conduct of any business.
9.13 Entire Agreement This written agreement represents the final agreement
between the parties/ unless later amended in writing and signed by 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.
9.14 Ambiguities. In the event of any ambiguity in any of the terms of mis
Agreement, it shall not be construed for or against any party hereto on the basis that
such party did or did not author the same.
9.15 Non-Waiver. Failure of either party hereto to insist on the strict
performance of any of the agreements contained herein or to exercise any rights or
remedies accruing hereunder upon default or failure of performance shall not be
considered a waiver of the right to insist on and to enforce by an appropriate remedy,
strict compliance with any other obligation hereunder or to exercise any right or
remedy occurring as a result of any future default or failure of performance.
9.16 Multiple Originals. It is understood and agreed that this Agreement may
be executed in a number of identical counterparts each of which shall be deemed an
original for all purposes.
9.17 Term. This Agreement shall be in force and effect from the Effective Date
for a term expiring on the later of (i) December 31 in the year following Completion of
the Public Improvements, as described in Section 4J of this Agreement or (ii) the date
the City Advance has been repaid in full.
9.18 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.
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9.19 Additional Actions. The parties agree to take such actions, including the
execution and delivery of such documents, instalments, petitions and certifications as
may be necessary or appropriate, from time to time, to carry out the terms, provisions
and intent of this Agreement and to aid and assist each other in carrying out said terms,
provisions and intent.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
duly executed as of^Xff
CITY OF B AYTOWN, TEXAS
Mayor
ATTEST
Oty Secretary
APPROVED AS TO FORM
By:
Name:.
Title:
ZONE NUMBER ONE, CITY OF BAYTOWN
Name;
Titte_
BAYTOWN REDEVELOPMENT AUTHORITY
Name:,
Title:
Name:.
Title:..
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EXHIBIT A
The Public Improvements
Traffic Signal at Garth Road and Independence Road Estimated Cost $300,000
City's share: $150,000**
•* The City's share is subject to funding by the Baytown Municipal Development
District
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