HomeMy WebLinkAbout(0011) Resolution 4777-05-2017_PID16 IA1 Reimb Agrmt_5.2.17.pdfA Resolution
NO. 4777-05-2017
APPROVING A REIMBURSEMENT AGREEMENT FOR
IMPROVEMENT AREA #1 OF THE FORT WORTH PUBLIC
IMPROVEMENT DISTRICT NO. 16 (WALSH RANCH/QUAIL
VALLEY); AND PROVIDING AN EFFECTIVE DATE
WHEREAS, the City Council of the City of Fort Worth, Texas (the "City Council"), in
connection with the Fort Worth Public Improvement District No. 16 (Walsh Ranch/Quail Valley) (the
"District") desires to approve the Improvement Area #1 Reimbursement Agreement (the
"Reimbursement Agreement"), between the City and QUAIL VALLEY DEVCO I, L.L.C. and
WALSH RANCHES LIMITED PARTNERSHIP, (collectively, the "Developer"), as lead developers
for Improvement Area #1 of the District, which sets forth their understanding and agreement related to
the construction, acquisition and financing of the public improvements in Improvement Area #1,
including the issuance of special assessment revenue bonds in connection with the same;
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF FORT WORTH, TEXAS:
SECTION 1. The Reimbursement Agreement is hereby authorized and approved in substantially
the final form attached hereto as EXHIBIT A and incorporated herein as a part hereof for all purposes
and the City Manager of the City is hereby authorized and directed to execute and deliver such
agreements with such changes as may be required to carry out the purpose of this Resolution.
SECTION 2. This Resolution is effective immediately upon adoption and approval.
Adopted this 2nd day of May, 2017.
ATTEST:
Un
ary JLRaA r, Ciiy Secretary
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EXHIBIT A
IMPROVEMENT AREA #1 REIMBURSEMENT AGREEMENT
Fort Worth Public Improvement District No. 16 (Walsh Ranch/Quail Valley)
Improvement Area # 1 Reimbursement Agreement
This Fort Worth Public Improvement District No. 16 (Walsh Ranch/Quail Valley) Improvement
Area #1 Reimbursement Agreement (this "Agreement") is entered into by QUAIL VALLEY DEVCO
I, L.L.C. ("Quail Valley"), and WALSH RANCHES LIMITED PARTNERSHIP ("Walsh Ranches" and
together with Quail Valley„ the "Developer") and the CITY OF FORT WORTH, TEXAS (the "City"), to
be effective May 2, 2017 (the "Effective Date"). The Developer and the City are sometimes
individually referred to as a "Party" and collectively as the "Parties."
SECTION 1. RECITALS
1.1 WHEREAS, capitalized terms used in this Agreement shall have the meanings given to them
in Section 2, unless otherwise defined herein or unless the context in which a term is used clearly
requires a different meaning; and
1.2 WHEREAS, all resolutions, ordinances, agreements, documents, and instruments
referenced in this Agreement are incorporated as part of this Agreement; and
1.3 WHEREAS, Quail Valley is a Texas limited liability company; and
1.4 WHEREAS, Walsh Ranches is a Texas limited partnership; and
1.5 WHEREAS, the City is a Texas home -rule municipality; and
1.6 WHEREAS, the City Council is authorized by Chapter 372, Texas Local Government Code, as
amended (the "PID Act"), to create public improvement districts within the City's corporate limits
and extraterritorial jurisdiction; and
1.7 WHEREAS, the PID Act authorizes public improvement districts to undertake public
improvement projects that confer a special benefit on the property within the districts and to pay
for such public improvement projects by levying assessments against benefited property within
the districts; and
1.8 WHEREAS, Quail Valley and Walsh Ranches filed with the municipal secretary of the City
(the "City Secretary") a petition (the "Petition") requesting the creation of a public improvement
district covering the Property; and
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1.9 WHEREAS, the Petition satisfied the requirements of the PID Act; and
1.10 WHEREAS, on August 30, 2016, the City Council approved Resolution No. 4671-08-2016:
(1) accepting the Petition; (2) calling a public hearing for September 20, 2016 (the "Public
Hearing") to take public testimony on the feasibility and advisability of creating Fort Worth Public
Improvement District No. 16 (Walsh Ranch/Quail Valley) (the "District") and the feasibility and
advisability of the public improvement projects proposed by the Petition; and (3) authorizing and
directing notices of the Public Hearing be mailed and published as required by the PID Act; and
1.11 WHEREAS, City staff caused notice of the Public Hearing to be mailed before the 151h day
before the date of the Public Hearing as required by the PID Act; and
1.12 WHEREAS, City staff caused notice of the Public Hearing to be published in a newspaper of
general circulation before the 151h day before the date of the Public Hearing as required by the PID
Act; and
1.13 WHEREAS, after publishing, mailing, and otherwise providing all notices required by the
PID Act and state law, the City Council conducted the Public Hearing on the date and at the
location and time specified in such notices, at which Public Hearing the City Council took public
testimony on the feasibility and advisability of creating the District and the feasibility and
advisability of undertaking the public improvement projects proposed by the Petition; and
1.14 WHEREAS, on September 27, 2016, the City Council approved Resolution No. 4686-09-
2016 authorizing the creation of the District covering the Property; and
1.15 WHEREAS, notice of Resolution No. 4686-09-2016 was published in a newspaper of
general circulation as required by the PID Act, whereupon the District authorization became
effective; and
1.16 WHEREAS, Resolution No. 4686-09-2016 was filed (1) November 29, 2016, as Instrument
No. 201627203, in the real property records of Parker County, Texas and (2) December 6, 2016, as
Instrument No. D216284552, in the real property records of Tarrant County, Texas; and
1.17 WHEREAS, the Property is to be developed in phases, the first area within the District to be
developed is Improvement Area #1; and
1.18 WHEREAS, Improvement Area #1 contains approximately 251.01 acres that is being
subdivided into approximately 587 single-family Lots that include the different Lot Types shown
in Table IV-C in the SAP; and
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1.19 WHEREAS, development of Improvement Area #1 requires construction of the Authorized
Improvements; and
1.20 WHEREAS, the Actual Costs of all of the Authorized Improvements that could be assessed
against Lots within Improvement Area #1 based on the special benefit conferred on the Lots by
the Authorized Improvements is $23,168,594, as shown on Table III -A in the SAP; and
1.21 WHEREAS, the PID-Funded Actual Costs of the Improvement Area #1 Funded
Improvements that are being assessed against Lots within Improvement Area #1 based on the
special benefit conferred on the Lots by the Improvement Area #1 Funded Improvements is
$6,350,000.00, which amount is shown in Table III -A in the SAP (the "Total Assessment Amount");
and
1.22 WHEREAS, the methodology by which the Total Assessment Amount is apportioned, and
the apportionment of the Total Assessment Amount to each Lot Type and Lot within Improvement
Area #1 is set forth in the SAP; and
1.23 WHEREAS, the apportionment of the Total Assessment Amount to each Lot within
Improvement Area #1 is shown on the Improvement Area #1 Assessment Roll; and
1.24 WHEREAS, on May 2, 2017, the City Council passed and approved Ordinance No.
(the "Assessment Ordinance") and in connection therewith approved and authorized
the execution of this Agreement; and
1.25 WHEREAS, the Assessment Ordinance: (1) approved the SAP; and (2) levied Assessments
against each Lot within Improvement Area #1 in accordance with the Improvement Area #1
Assessment Roll; and
1.26 WHEREAS, the Assessment Ordinance provides that an Assessment levied against a Lot
may be paid in full at any time in accordance with the PID Act; however, if not paid in full, the
owner of the Lot shall not be in Default but shall be deemed to have elected to pay the Assessment
in Annual Installments in accordance with this Agreement; and
1.27 WHEREAS, Annual Installments shall be billed and collected by or on behalf of the City in
accordance with the Assessment Ordinance and this Agreement and as authorized by the PID Act;
and
1.28 WHEREAS, all Assessment Revenue shall be deposited into the District Fund; and
1.29 WHEREAS, the District Fund shall only be used to pay the Reimbursement Balance or to
pay debt service on Improvement Area #1 PID Bonds; and
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1.30 WHEREAS, this Agreement is a "reimbursement agreement" authorized by Section
372.023(d)(1) of the PID Act; and
1.31 WHEREAS, the foregoing RECITALS: (1) are part of this Agreement for all purposes; (2) are
true and correct; and (3) constitute representations, warranties, and covenants that each Party
has relied upon in entering into this Agreement.
NOW THEREFORE, for and in consideration of the mutual obligations of the Parties set forth in
this Agreement, the Parties agree as follows:
SECTION 2. DEFINITIONS
2.1 "Actual Costs" are defined in the SAP.
2.2 "Administrative Expenses" are defined in the SAP.
2.3 "Administrator" is defined in the SAP.
2.4 "Agreement" is defined in the Preamble.
2.S "Annual Installment" is defined in the SAP. As used herein, the term Annual Installment is
comprised of two components: (a) Administrative Expenses, and (b) Assessment Revenues. The
total Annual Installment for all lots in the District, together with the breakdown of Administrative
Expenses and Assessment Revenue, are shown in the table "Improvement Area #1 Annual
Installments - All Lots," in Appendix A-1 of the SAP, as updated from time to time (Assessment
Revenues are set forth under the column titled "Reimbursement Agreement Cash Flow").
2.6 "Assessment" is defined in the SAP.
2.7 "Assessment Revenue" means: (1) revenue collected from the payment of Improvement
Area #1 Assessments (including pre -payments and amounts received from the foreclosure of liens
but excluding costs and expenses of collection); and (2) revenue collected from the payment of the
Annual Installments (excluding Administrative Expenses) of the Improvement Area #1
Assessments.
2.8 "Authorized Improvements" means the public improvement projects authorized by the PID
Act and to be constructed in Improvement Area #1 that confer a special benefit on Improvement
Area #1, including, but not limited to, the Improvement Area #1 Funded Improvements.
2.9 "Chief Financial Officer" the Chief Financial Officer of the City of Fort Worth, also known as
the Director of Financial Management Services/City Treasurer.
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2.10 "CU" is defined in the Preamble.
2.11 "City Council" means the governing body of the City of Fort Worth, Texas.
2.12 "City Engineer" means the person designated in writing as the "City Engineer" for purposes
of this Agreement by the City Manager of the City.
2.13 "City Secretary" is defined in Section 1.8.
2.14 "Default" is defined in Section 3.11.
2.15 "Delinquent Collection Costs" are defined in the SAP.
2.16 "Developer" is defined in the Preamble.
2.17 "Developer's Continuing Disclosure Agreement" means a continuing disclosure agreement
of the Developer entered into in connection with the issuance of the Improvement Area #1 Bonds,
if any, in satisfaction of the requirements of Rule 15c2-12, promulgated by the United States
Securities and Exchange Commission.
2.18 "Development Agreement" means that certain Economic Development Agreement by and
between the City of Fort Worth and Walsh Ranches, the Walsh Children's Trusts, The Walsh
Grandchildren's Trust, and F. Howard Walsh, Jr., entered into on May 6, 2003, as the same may be
amended from time to time.
2.19 "District" is defined in Section 1.10.
2.20 "District Fund" means a fund created by the City for the sole benefit of the District that is
segregated from all other funds of the City and into which the City shall deposit Assessment
Revenue pursuant to Section 3.2 and from which the City will pay the Reimbursement Balance
pursuant to Section 3.3.2.
2.21 "Effective Date" is defined in the Preamble.
2.22 "Failure" is defined in Section 3.11.
2.23 "Improvement Area #1" is defined in the SAP.
2.24 "Improvement Area #1 Assessments" mean Assessments levied on the property in
Improvement Area #1, as shown on the Improvement Area #1 Assessment Roll.
2.25 "Improvement Area #1 Assessment Roll" means the assessment roll attached as Appendix
A-1 to the SAP that identifies the Assessments against each Lot within Improvement Area #1.
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2.26 "Improvement Area #1 Funded Improvements" mean the public improvement projects
authorized by the PID Act that may be undertaken and will be financed by the District that confer a
special benefit on Improvement Area #1, which Improvement Area #1 Funded Improvements are
described in the SAP.
2.27 "Improvement Area #1 Indenture" means the Indenture relating to the Improvement Area
#1 Bonds.
2.28 "Improvement Area #1 PID Bonds" means PID Bonds issued to finance Improvement Area
#1 Funded Improvements.
2.29 "Improvement Area #2 is defined in Section 3.4.2.
2.30 "Improvements Completion Date" means the date on which the City Engineer certifies in
writing that the Authorized Improvements have been constructed in substantial compliance with
the approved plans and specifications for such improvements and are ready to be accepted by the
City.
2.31 "Indenture" is defined in the SAP.
2.32 "Lot" is defined in the SAP.
2.33 "Lot Type" is defined in the SAP.
2.34 "Master Reimbursement Agreement" means that certain Master Reimbursement
Agreement entered into by and between the City and the Developer, dated as of the date hereof,
pursuant to which the timing of certain obligations of the City and the Developer with respect to
the District is established, including the proposed levy of assessments for Future Improvement
Areas (as defined in the SAP) and the issuance of PID Bonds, if any.
2.35 "Maturity Date" is defined in Section 3.3.1.
2.36 "Net Proceeds" means the proceeds generated from the issuance and sale of public
improvement district bonds minus costs of issuance and reserve fund deposits and capitalized
interest, if any, required by the Improvement Area # 1 Indenture.
2.36 "Party" or "Parties" are defined in the Preamble.
2.37 "Petition" is defined in Section 1.8.
2.38 "PID Act" is defined in Section 1.6.
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2.39 "PID Bonds" are defined in the SAP.
2.40 "PID-Funded Actual Costs" are defined in the SAP.
2.41 "Prepayments" are defined in the SAP.
2.42 "Property" means the approximately 1,704 acres within the corporate limits and
extraterritorial jurisdiction of the City as described in the Petition and the SAP.
2.43 "Reimbursement Amount" is defined in Section 3.3.1.
2.44 "Reimbursement Balance" is defined in Section 3.3.1.
2.45 "SAP" means the Fort Worth Public Improvement District No. 16 (Walsh Ranch/Quail Valley)
Service and Assessment Plan dated May 2, 2017, approved by Ordinance No. adopted by
the City Council on _, 2017, including updates, modifications, and amendments
approved by the City Council from time to time in accordance with the SAP and the PID Act.
2.46 "Total Assessment Amount" is defined in Section 1.21.
2.47 "Transfer" is defined in Section 3.8
2.48 "Transferee" is defined in Section 3.8
SECTION 3. ADDITIONAL PROVISIONS
3.1 Construction of Improvement Area #1 Funded Improvements. The Developer, at its cost
and expense, will construct or cause to be constructed all of the Authorized Improvements,
including the Improvement Area #1 Funded Improvements, on a schedule determined by the
Developer. The Authorized Improvements shall be constructed in accordance with all applicable
laws, ordinances, rules, and regulations of the State of Texas, the City, and any other political
subdivision or governmental agency that has jurisdiction over the construction of the Authorized
Improvements; provided, however, contracts for the construction of such Authorized
Improvements shall be exempt from competitive bidding requirements pursuant to Section
252.022(a)(9), Texas Local Government Code, as amended. The Developer shall prepare, bid,
award, and manage all contracts for the construction of the Authorized Improvements and shall
provide to the City Engineer, the City's PID Administrator and the Chief Financial Officer copies of
all contracts within ten (10) business days of such contract being entered into, but in no event
later than thirty (30) days after the date on which such contracts were awarded. All plans and
specifications for the Authorized Improvements must be approved by the City Engineer, and all
construction shall be inspected by or on behalf of the City for compliance with the approved plans
and specifications. The Developer shall maintain books and records evidencing the Actual Costs,
including the PID-Funded Actual Costs, paid or incurred by the Developer in the construction of
the Authorized Improvements, including the Improvement Area #1 Funded Improvements, copies
of which books and records shall be provided to the City Engineer, the City's PID Administrator
and the Chief Financial Officer. When construction of the Authorized Improvements is complete,
and when the completed Authorized Improvements have been inspected by the City Engineer and
determined to be in substantial compliance with the approved plans and specifications, the City
Engineer. shall certify such compliance in writing, including the Actual Costs of the completed
Authorized Improvements, and the Developer shall dedicate (and the City shall accept) the
Authorized Improvements, lien free, in accordance with standard City policies applicable to such
improvements, including maintenance bonds and assignments of warranties, if any.
3.2 District Fund. Until Improvement Area #1 PID Bonds are issued, the City shall bill, collect,
and deposit into the District Fund all Assessment Revenue. Annual Installments shall be billed and
collected by the City (or by any other person, entity, or governmental agency permitted by law) in
the same manner and at the same time as City ad -valorem taxes are billed and collected.
Collection of Annual Installments shall be deferred pursuant to Section 372.017 of the PID Act
until the first date following the completion of the Authorized Improvements in Improvement
Area #1 on which such Annual Installments can be collected in the the manner and at the time
described above. Collection of the Annual Installments is anticipated to commence by October 1,
2018, with such Annual Installments being delinquent if not paid on or before January 31, 2019.
In the event collection does not commence by such time, the parties shall negotiate in good faith to
update the terms of Section 3.3 below accordingly. The District Fund will only be used to pay the
Reimbursement Balance or as directed in the Improvement Area #1 Indenture entered into in
connection with the issuance of the Improvement Area #1 PID Bonds. After issuance, and for so
long as Improvement Area #1 PID Bonds are outstanding under the terms of the Improvement
Area #1 Indenture, Assessment Revenue shall be deposited, and payments therefrom shall be
applied in accordance with the provisions of the Improvement Area #1 Indenture. Once
Improvement Area #1 PID Bonds are issued, the Improvement Area #1 Indenture shall control in
the event of any conflicts with this Agreement. For the avoidance of doubt, (1) while any
Improvement Area #1 PID Bonds are outstanding under the terms of the Improvement Area #1
Indenture, the right of the Developer to receive payment of the Reimbursement Balance shall be
subordinate to the deposits required under the Improvement Area #1 Indenture related to the
Improvement Area #1 PID Bonds, and (2) in no event will Developer be entitlted to payment of the
Reimbursement Balance from Administrative Expenses.
3.3 Payment of Reimbursement Balance.
3.3.1 Subject to the terms and conditions herein, including Section 3.2 above, the City
agrees to pay to the Developer from collected Assessment Revenues deposited
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to the District Fund, commencing March 15, 2019, and continuing until
September 15, 2048 (the "Maturity Date") the principal amount equal to SIX
MILLION THREE HUNDRED FIFTY THOUSAND AND NO/100THS DOLLARS
($6,350,000.00) (the "Reimbursement Amount"). The Reimbursement Amount
shall bear simple interest per annum on the unpaid balance at the rate of six
percent (6%) for years one and two and five percent (5%) for years three
through 30 or until Improvement Area #1 PID Bonds are issued. The interest
rates have been determined by the City Council in accordance with Section
372.023(e) of the PID Act based on the Bond Buyer Revenue Bond Index
published in The Bond Buyer, a daily publication that publishes this interest rate
index (and on the date of the determination by the City Council, the average
index rate was not less than 4.02%). If any portion of the Reimbursement
Amount remains unpaid after the City has elected to issue Improvement Area #1
PID Bonds, the interest rate on the unpaid Reimbursement Amount shall be the
same as the interest rate on the Improvement Area #1 PID Bonds; provided,
however, that such rate shall not exceed five percent (5%). The Reimbursement
Amount shall be reduced by the difference, if any, determined by subtracting the
Actual Costs of the Authorized Improvements from $6,350,000.00. The
Reimbursement Amount together with interest payable as described above is
referred to as the "Reimbursement Balance".
3.3.2 The Reimbursement Balance is payable solely from: (1) quarterly payments by
the City to the Developer made each March 15, June 15, September 15, and
December 15 beginning March 15, 2019 from the Assessment Revenues
deposited into the District Fund beginning on March 15, 2019, and continuing
each calendar quarter thereafter until the earlier of the Maturity Date or the date
on which the Reimbursement Balance is paid in full, (2) the Net Proceeds of the
Improvement Area #1 PID Bonds issued by the City and secured by the
Assessment Revenue; or (3) a combination of items (1) and (2). The
Reimbursement Balance shall be further reduced by the costs of issuance
associated with the issuance of Improvement Area #1 PID Bonds, including
any underwriter's discount, in addition to any reserve fund deposits and
capitalized interest, if any, required by the Improvement Area #1 Indenture,
notwithstanding that such funds shall not actually be paid to the Developer.
Each quarterly payment to the Developer from the District Fund shall be
accompanied by an accounting from the City's Chief Financial Officer or the City's
PID Administrator that certifies the Reimbursement Balance as of the date of the
payment and that itemizes all deposits to and disbursements from the District
Fund since the last quarterly payment. If there is a dispute over the amount of
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any quarterly payment, the City shall nevertheless pay the undisputed amount,
and the Parties shall use all reasonable efforts to resolve the disputed amount
before the next quarterly payment is due; however, if the Parties are unable to
resolve the disputed amount, the determination certified by the City's Chief
Financial Officer of the disputed amount shall control.
3.3.3 Beginning in the year in which the Improvement Area #1 PID Bonds are to be
paid in full, the City will amortize the outstanding Reimbursement Balance in a
manner that is determined by the City's Chief Financial Offier to provide the
most expedient payoff of the outstanding Reimbursement Balance while seeking
to maintain level reimbursement payments and taking into account
Administrative Expenses.
3.4 PID Bonds.
3.4.1 The Parties acknowledge and agree that the District was created with the
expectation that the Parties would enter into this Agreement and that the City
would issue PID Bonds in satisfaction of the Reimbursement Balance at the time
set forth in Section 3.4.2 below. Improvement Area #1 PID Bonds, if issued, shall
be secured by and paid solely from the Assessment Revenue in accordance with
the Improvement Area #1 Indenture. While any Improvement Area #1 PID
Bonds are outstanding, subject to the terms of the Improvement Area #1
Indenture, the Developer shall only be entitled to annual payments from the
Assessment Revenues to the extent any Assessment Revenues remain
available after subtracting any amounts required to be paid, deposited or
transferred under the Improvement Area #1 Indenture, including debt
service payments on the Improvement Area #1 PID Bonds, and amounts
required to be deposited into any reserve fund. If the Improvement Area #1
PID Bonds are paid in full prior to the Maturity Date, the City shall thereafter
continue to make payments to the Developer from the District Fund until the
earlier of the Maturity Date or the date on which the Reimbursement Balance is
paid in full. The parties acknowledge that approval of the issuance of any
Improvement Area #1 Bonds by the City Council is a governmental function
within the City's sole discretion, and is subject to prevailing state and federal law
at the time of the proposed issuance. The inability or failure of the City to issue
Improvement Area #1 Bonds shall not constitute a Failure by the City or
otherwise result in a Default by the City under this Agreement.
3.4.2 Improvement Area #1 PID Bonds will not be issued until a final plat has been
recorded for the second improvement area in the District ("Improvement Area
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#2"). If no final plat has been recorded with respect to Improvement Area #2
within five (5) years of the date assessments began to be collected for the entire
Improvement Area #1, then no Improvement Area #1 PID Bonds will be issued,
and the payment of the Reimbursement Balance will be limited to quarterly
payments by the City to the Developer from the Assessment Revenues deposited
into the District Fund.
3.4.3 Any Prepayments of Assessments while any Improvement Area #1 PID Bonds
are outstanding shall be applied pursuant to the term of the Improvement Area
#1 Indenture.
3.4.4 The Improvement Area #1 PID Bonds shall have a maximum maturity date of 20
years from the date of their initial issuance.
3.5 Unpaid Reimbursement Balance. If any portion of the Reimbursement Balance remains
unpaid on the Maturity Date, such portion of the Reimbursement Balance shall be canceled and for
all purposes this Agreement shall be deemed to have been conclusively and irrevocably PAID IN
FULL, and such portion of the Reimbursement Balance shall no longer be deemed to be payable.
The Developer shall not be relieved of its duty to construct or cause to be constructed the
Authorized Improvements even if there are insufficient funds payable under this Agreement to
pay the PID-Funded Actual Costs of the Improvement Area #1 Funded Improvements.
3.6 City Obligations: Limitations.
3.6.1 The Reimbursement Balance is payable to the Developer and secured under this
Agreement solely as described above. NO OTHER CITY FUNDS, REVENUE, TAXES, INCOME OR
PROPERTY MAY BE PLEDGED TO THE PAYMENT OF ANY AMOUNTS UNDER THIS AGREEMENT
OR SHALL BE USED EVEN IF THE REIMBURSEMENT BALANCE IS NOT PAID IN FULL AT
MATURITY. NOTWITHSTANDING ITS COLLECTION EFFORTS, IF THE CITY FAILS TO RECEIVE
ALL OR ANY PART OF THE ASSESSMENT REVENUES AND, AS A RESULT, IS UNABLE TO MAKE
ANY PAYMENT DESCRIBED HEREIN, SUCH FAILURE SHALL NOT CONSTITUTE A FAILURE OR
DEFAULT BY THE CITY UNDER THIS AGREEMENT. THIS AGREEMENT AND ANY IMPROVEMENT
AREA #1 PID BONDS ISSUED IN CONNECTION HEREWITH SHALL NOT AND SHALL NEVER GIVE
RISE TO OR CREATE: (1) A CHARGE AGAINST THE GENERAL CREDIT OR TAXING POWERS OF
THE CITY OR ANY OTHER TAXING UNIT; (2) A DEBT OR OTHER OBLIGATION OF THE CITY
PAYABLE FROM ANY SOURCE OF REVENUE, TAXES, INCOME OR PROPERTIES OF THE CITY
OTHER THAN FROM (A) ASSESSMENT REVENUE PURSUANT TO THIS AGREEMENT, OR (B) THE
NET PROCEEDS OF ANY IMPROVEMENT AREA #1 BONDS PAYABLE FROM ASSESSMENT
REVENUE PURSUANT TO THE IMPROVEMENT AREA #1 INDENTURE; (3) ANY OBLIGATION OF
THE CITY TO ISSUE PID BONDS OR OTHER OBLIGATIONS; OR (4) ANY OBLIGATION OF THE CITY
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TO PAY ANY AMOUNT DUE OR TO BECOME DUE UNDER THIS REIMBURSEMENT AGREEMENT
OTHER THAN FROM (A) ASSESSMENT REVENUE PURSUANT TO THIS AGREEMENT, OR (B) THE
NET PROCEEDS OF ANY IMPROVEMENT AREA #1 BONDS PAYABLE FROM ASSESSMENT
REVENUE PURSUANT TO THE IMPROVEMENT AREA #1 INDENTURE.
3.6.2 None of the City or any of its elected or appointed officials or any of its officers,
employees, consultants or representatives shall incur any liability hereunder to the Developer or
any other party in their individual capacities by reason of this Agreement or their acts or
omissions under this Agreement.
3.6.3 Until Improvement Area #1 PID Bonds are issued, the obligation of the City to
deposit Assessment Revenue into the District Fund is subject only to the condition that the
Improvements Completion Date has occurred. Upon the issuance of Improvement Area #1 PID
Bonds, the City shall deposit Assessment Revenue as required by the Improvement Area #1
Indenture.
3.6.4 Notwithstanding Section 3.6.3 above, the obligation of the City to make payments to
the Developer under this Agreement is subject to Section 3.6.1 above and is conditioned upon: (1)
the Improvements Completion Date having occurred; (2) the City Engineer having certified that
the Total Assessment Amount does not exceed eighty percent (80%) of the Actual Costs of the
Authorized Improvements; and (3) the Developer being in compliance with its obligations under
the Developer's Continuing Disclosure Agreement, if any, entered into in connection with the
issuance of Improvement Area #1 Bonds. From and after the satisfaction of each of the foregoing
conditions: (1) the obligations of the City under this Agreement to make payments to the
Developer shall be unconditional, and shall continue until the Maturity Date or until the
Reimbursement Balance has been paid in full, whichever is earlier; and (2) there shall be no
conditions, defenses, or rights of offset to the obligations of the City: (i) to make payments to the
Developer from the District Fund in accordance with this Agreement; (ii) if Improvement Area #1
PID Bonds are issued, to use the Net Proceeds thereof to pay all or a portion of the
Reimbursement Balance and thereafter to use Assessment Revenue to pay debt service on the
Improvement Area #1 PID Bonds in accordance with this Agreement and the Indenture; and (iii) ,
subject to Section 3.3.3, if Improvement Area #1 PID Bonds have been issued and paid in full prior
to the Maturity Date, to resume making payments to the Developer from the District Fund until the
Maturity Date or until the Reimbursement Balance is paid in full, whichever is earlier.
3.7 Term. The term of this Agreement shall begin on the Effective Date and shall continue until
the earlier to occur of the Maturity Date or the date on which the Reimbursement Balance is paid in
full.
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3.8 Transfers. Quail Valley and Walsh Ranches each has the right to assign, convey, transfer,
mortgage, pledge, or otherwise encumber, in whole or in part without the consent of (but with
notice to) the City, their respective obligations, rights, title, or interest under this Agreement to
any person or entity, including, but not limited to, their respective rights, title, or interest in and to
payments of the Reimbursement Balance, whether such payments are made quarterly from the
District Fund or from the Net Proceeds of Improvement Area #1 PID Bonds (any of the foregoing, a
"Transfer," and the person or entity to whom the Transfer is made, a "Transferee").
Notwithstanding the foregoing, no Transfer shall be effective until five (5) days after written
notice of the Transfer is received by the City, including, for each Transferee, the notice information
required pursuant to Section 3.10. The City may rely on notice of a Transfer received from the
Developer without obligation to investigate or confirm the validity of the Transfer. The Developer
waives all rights or claims against the City for any funds paid to a Transferee as a result of a
Transfer for which the City received notice. The foregoing notwithstanding, no Transfer of
payments of the Reimbursement Balance may be pledged to the payment of debt service on public
securities issued by any state of the United States or any political subdivision thereof without the
approval of the City Council.
3.9 Applicable Law: Venue. This Agreement is being executed and delivered and is intended to
be performed in the State of Texas. Except to the extent that the laws of the United States may
apply, the substantive laws of the State of Texas shall govern the interpretation and enforcement
of this Agreement. In the event of a dispute involving this Agreement, venue shall lie in any court
of competent jurisdiction in Tarrant County, Texas.
3.10 Notice. Any notice required by or contemplated by this Agreement must be in writing and
shall be deemed given at the addresses shown below: (1) when delivered by a nationally
recognized delivery service such as FedEx or UPS with evidence of delivery signed by any person
at the delivery address regardless of whether such person is the named addressee; or (2) seventy-
two (72) hours after deposited with the United States Postal Service, Certified Mail, Return Receipt
Requested.
If to the City:
City of Fort Worth
Jesus Chapa, Assistant City Manager
City of Fort Worth
200 Texas Street
Fort Worth, Texas 76102
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If to the Developer:
QUAIL VALLEY DEVCO I, L.L.C.
c/o Republic Property Group, Inc.
Attn: Jake Wagner
8401 North Central Expressway, Suite 350
Dallas, Texas 75225
WALSH RANCHES LIMITED PARTNERSHIP
Attn: G. Malcolm Louden
500 West Seventh Street
Suite 1007
Fort Worth, TX 76102
Any Party may change its address by delivering notice of the change in accordance with this
section.
3.11 Default/Remedies.
3.11.1 If either Party fails to perform an obligation imposed on such Party by this
Agreement (a "Failure") and such Failure is not cured after notice and the expiration of the cure
periods provided in this section, then such Failure shall constitute a "Default." If a Failure is
monetary, the non -performing Party shall have thirty (30) days within which to cure. If the
Failure is non -monetary, the non -performing Party shall have forty-five (45) days within which to
cure.
3.11.2 If the Developer is in Default, the City's sole and exclusive remedy shall be to
compel performance through injunctive relief or specific performance. No Default by the
Developer shall entitle the City to terminate this Agreement. No Default by the Developer after the
Improvements Completion Date shall entitle the City to withhold payments to the Developer from
the District Fund in accordance with this Agreement.
3.11.3 If the City is in Default, the Developer's sole and exclusive remedies shall be to:
(1) compel performance through injunctive relief or specific performance; and/or (2) seek specific
enforcement of this Reimbursement Agreement. No Default by the City shall entitle the Developer
to terminate this Agreement.
3.11.4 The City shall give notice of any alleged Failure by the Developer to each
Transferee identified in any notice from the Developer, and such Transferees shall have the right,
but not the obligation, to cure the alleged Failure within the same cure periods that are provided
to the Developer. The election by a Transferee to cure a Failure by the Developer shall constitute a
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cure by the Developer but shall not obligate the Transferee to be bound by this Agreement unless
the Transferee agrees in writing to be bound.
3.12 Remedies Outside the Agreement. Nothing in this Agreement constitutes a waiver by the
City of any remedy the City may have outside this Agreement against any the Developer, any
Transferee, or any other person or entity involved in the design, construction, or installation of the
Authorized Improvements. The obligations of the Developer hereunder shall be those of a party
hereto and not as an owner of property in the PID. Nothing herein shall be construed as affecting
the City's or the Developer's rights or duties to perform their respective obligations under other
agreements, use regulations or subdivision requirements relating to the development of property
in the PID.
3.13 Entire Agreement; Amendment. This Agreement supersedes all prior agreements (whether
written or oral) between the Parties regarding the subject matter hereof and constitutes the only
agreement between the Parties with regard to the subject matter hereof. In the event of any
conflict between this Agreement and any other instrument, document, or agreement to which
either Party is a party or by which either Party is bound, the provisions and intent of this
Agreement shall control. This Agreement may only be amended by written agreement of the
Parties.
3.14 Severabilitv. If any provision of this Agreement is held invalid by any court, such holding
shall not affect the validity of the remaining provisions.
3.15 Non -Waiver. The failure by a Party to insist upon the strict performance of any provision
of this Agreement by the other Party, or the failure by a Party to exercise its rights upon a Default
by the other Party, shall not constitute a waiver of such Party's right to insist and demand strict
compliance by such other Party with the provisions of this Agreement.
3.16 Third Party Beneficiaries. Nothing in this Agreement is intended to or shall be construed to
confer upon any person or entity other than the City and the Developer (including Developer's
Transferees following a transfer) any rights under or by reason of this Agreement. All provisions
of this Agreement shall be for the sole and exclusive benefit of the City and the Developer
(including Developer's Transferees following a Transfer).
3.17 Counterparts. This Agreement may be executed in multiple counterparts, which, when
taken together, shall be deemed one original. This Agreement may be delivered by the exchange
of signed signature pages by facsimile transmission or by electronic mail with a "pdf' copy or
other replicating image attached, and any printed or copied version of any signature page so
delivered shall have the same force and effect as an originally signed version of such signature
page.
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3.18 Representations and Warranties.
3.18.1 Quail Valley represents and warrants to the City that: (1) Quail Valley has the
authority to enter into and perform its obligations under this Agreement; (2) Quail Valley has the
financial resources, or the ability to obtain sufficient financial resources, to meet its obligations
under this Agreement; (3) the person executing this Agreement on behalf of Quail Valley has been
duly authorized to do so; (4) this Agreement is binding upon Quail Valley in accordance with its
terms; and (5) the execution of this Agreement and the performance by Quail Valley of its
obligations under this Agreement do not constitute a breach or event of default by Quail Valley
under any other agreement, instrument, or order to which Quail Valley is a party or by which Quail
Valley is bound.
3.18.2 Walsh Ranches represents and warrants to the City that: (1) Walsh Ranches has
the authority to enter into and perform its obligations under this Agreement; (2) ) Walsh Ranches
has the financial resources, or the ability to obtain sufficient financial resources, to meet its
obligations under this Agreement; (3) the person executing this Agreement on behalf of Walsh
Ranches has been duly authorized to do so; (4) this Agreement is binding upon Walsh Ranches in
accordance with its terms; and (5) the execution of this Agreement and the performance by Walsh
Ranches of its obligations under this Agreement do not constitute a breach or event of default by
Walsh Ranches under any other agreement, instrument, or order to which Walsh Ranches is a
party or by which Walsh Ranches is bound.
3.18.3 Quail Valley and Walsh Ranches each represent and warrant to the City that with
regard to the obligations of the "Developer" under this Agreement, Quail Valley and Walsh
Ranches are jointly and severally liable for such obligations unless and until either of them has
transferred such obligations, in whole or in part, pursuant to Section 3.8. In the event of a
Transfer by either Quail Valley or Walsh Ranches of all or any of its obligations under this
Agreement pursuant to Section 3.8, the Transferee shall only be liable to the extent of the
obligations that are the subject of the Transfer and shall not be jointly liable with the Developer or
with any other Transferee for any o ther obligations under this Agreement.
The City represents and warrants to Quail Valley and Walsh Ranches that: (1) the City has the
authority to enter into and perform its obligations under this Agreement; (2) the person executing
this Agreement on behalf of the City has been duly authorized to do so; (3) this Agreement is
binding upon the City in accordance with its terms; and (4) the execution of this Agreement and
the performance by the City of its obligations under this Agreement do not constitute a breach or
event of default by the City under any other agreement, instrument, or order to which the City is a
party or by which the City is bound.
[Signature Page Follows]
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ATTEST
[Name], City Secretary
APPROVED AS TO FORM
[Name], City Attorney
CITY OF FORT WORTH, TEXAS
Name
Title
Date:
QUAIL VALLEY DEVCO I, LLC,
a Texas limited liability company
By: RPG QVR, LLC,
a Texas limited liability company
By: Republic Property Group, Ltd.,
a Texas limited partnership, its Manager
By: RPG, LLC, a Texas limited liability company, its
General Partner
By:
Jake Wagner, Co -CEO
WALSH RANCHES LIMITED PARTNERSHIP,
a Texas limited partnership,
By: Walsh North Star Company,
a Texas corporation, its General Partner
M.
G. Malcolm Louden, President