HomeMy WebLinkAboutResolution - 2022-R0160 - Reimbursement Agreement with MM Holdsworth NWP for Northwest Passage PIDResolution No. 2022-RO160
Item No. 8.14
March 22, 2022
RESOLUTION
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK:
THAT the Mayor of the City of Lubbock is hereby authorized and directed to execute for
and on behalf of the City of Lubbock, a Public Improvement District (PID) Reimbursement
Agreement No. 16493 for authorized improvements in the North West Passage PID, by and
between the City of Lubbock and MM Holdsworth NWP, LLC, and related documents. Said
Contract is attached hereto and incorporated in this resolution as if fully set forth herein and shall
be included in the minutes of the City Council.
Passed by the City Council on
ATTEST:
Retie ca Garza, City Sec
APPROVED AS TO CONTENT:
Chief Financial Officer
elli Leisure, Assistant City Attorney
March 22, 2022
DANIEL M. POPE, MAYOR
ocs/RES.PID Reimbursement Agreement NWPPID
15.22
Resolution No. 2022-RO160
PID Reimbursement Agreement
Northwest Passage Public Improvement District
This PID Reimbursement Agreement (this "Agreement') is entered into by MM
Holdsworth NWP, LLC, a Texas limited liability company (the "Developer') and the City of
Lubbock, Texas, a Texas home -rule municipality (the "City"), to be effective March 22, 2022 (the
"Effective Date"). The Developer and the City are 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;
1.2 WHEREAS, unless otherwise defined: (1) all references to "sections" shall mean
sections of this Agreement; (2) all references to "exhibits" shall mean exhibits to this Agreement
which are incorporated as part of this Agreement for all purposes; and (3) all references to
"ordinances" or "resolutions" shall mean ordinances or resolutions adopted by the City Council;
1.3 WHEREAS, the Developer is a Texas limited liability company;
1.4 WHEREAS, the City is a Texas home -rule municipality;
1.5 WHEREAS, on September 14, 2021, the City Council passed and approved the PID
Creation Resolution authorizing the creation of the PID pursuant to the Act, covering
approximately 992.06 acres within the City's corporate boundaries, which land is described in the
PID Creation Resolution;
1.6 WHEREAS, on March 22, 2022, the City Council passed and approved an
Assessment Ordinance;
1.7 WHEREAS, the Assessment Ordinance approved the SAP;
1.8 WHEREAS, the SAP identifies Authorized Improvements to be designed,
constructed, and installed by or at the direction of the Parties that confer a special benefit on the
Assessed Property;
1.9 WHEREAS, the SAP sets forth the Actual Costs of the Authorized Improvements;
1.10 WHEREAS, the SAP determines and apportions the Actual Costs of the
Authorized Improvements to the Assessed Property, which Actual Costs represent the special
benefit that the Authorized Improvements confer upon the Assessed Property as required by the
Act;
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1.11 WHEREAS, an Assessment Ordinance levied the Actual Costs of the Authorized
Improvements as Assessments against the Assessed Property in the amounts set forth on an
Assessment Roll;
1.12 WHEREAS, Assessments and Annual Installments are due and payable as
described in the SAP;
1.13 WHEREAS, Annual Installments shall be billed and collected by the City or their
designee;
1.14 WHEREAS, this Agreement is a "reimbursement agreement" authorized by
Section 372.023(d)(1) of the Act;
1.15 WHEREAS, the foregoing RECITALS: (1) are part of this Agreement for all
purposes; (2) are true and correct; and (3) each Party has relied upon such Recitals in entering
into this Agreement; and
1.16 WHEREAS, all resolutions and ordinances referenced in this Agreement (e.g., the
PID Creation Resolution and the Assessment Ordinance), together with all other documents
referenced in this Agreement (e.g., the SAP), are incorporated as part of this Agreement for all
purposes as if such resolutions, ordinances, and other documents were set forth in their entirety
in or as exhibits to 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 "Act" is defined as Chapter 372, Texas Local Government Code, as amended.
2.2 "Actual Costs" means the actual or budgeted costs and expenses related to the creation
and operation of the District and the construction, operation, and maintenance of the Authorized
Improvements.
2.3 "Agreement" is defined in the introductory paragraph.
2.4 "Annual Installment" means the annual installment payment of an Assessment as
approved by the City Council.
2.5 "Applicable Laws" means the Act and all other laws or statutes, rules, or regulations of
the State of Texas or the United States, as the same may be amended, by which the City and its powers,
securities, operations, and procedures are, or may be, governed or from which its powers may be
derived.
2.6 "Approval Form" means the form attached to the Certificate for Payment to be executed
by a City Representative if and when the Certificate for Payment is approved by the City.
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2.7 "Approved Certificate for Payment" means a Certificate for Payment for which a City
Representative has executed and returned an Approval Form to the Developer.
2.8 "Assessed Property" means the property subject to the Assessments as provided in the
Assessment Ordinance.
2.9 "Assessment" means the special assessment levied by the Assessment Ordinance.
2.10 "Assessment Ordinance" means the ordinance adopted by the City Council on March
22, 2022 levying the Assessments.
2.11 "Assessment Revenue" means the revenues actually received by or on behalf of the
City from the collection of Assessments.
2.12 "Assessment Roll" means the assessment roll(s) attached to or otherwise incorporated
into the SAP.
2.13 "Authorized Improvements" mean the public improvements that benefit the Assessed
Property as described in the SAP and as authorized by Section 372.003 of the Act. Estimated costs of
the Authorized Improvements are shown in the SAP.
2.14 "Certificate for Payment" means a certificate (substantially in the form of Exhibit A
or as otherwise approved by the Developer and a City Representative) executed by a representative of
the Developer and approved by a City Representative, delivered to a City Representative, specifying
the work performed and the amount charged (including materials and labor costs) for Actual Costs,
and requesting payment of such amount from the appropriate fund or funds. Each certificate shall
include supporting documentation in the standard form for City construction projects and evidence
that each Authorized Improvement (or its completed segment) covered by the certificate have been
inspected by the City.
2.15 "City Council" means the governing body of the City.
2.16 "City Representative" means the City Manager or Chief Financial Officer of the City
and any other person authorized by the City Council to undertake the actions referenced herein.
2.17 "City" is defined in the introductory paragraph.
2.18 "Completed" with respect to an Authorized Improvement, means: (a) that the work on
the Authorized Improvement has been completed in accordance with approved plans and all applicable
governmental laws, rules, and regulations, (b) all construction costs have been paid in full and that no
liens exist on or will exist on the applicable Authorized Improvement, and (c) an affidavit of bills paid,
in a form reasonably acceptable to the City, from the construction contractor(s) for the applicable
Authorized Improvement has been provided to the City.
2.19 "Default" is defined in Section 4.8.1.
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2.20 "Developer" is defined in the introductory paragraph.
2.21 "Developer Advances" mean advances made by the Developer to pay Actual Costs.
2.22 "Drainage Utility Fund" means the City's drainage utility system fund(s) maintained
pursuant to Chapter 1502, Texas Government Code and/or Chapter 552, Texas Local Government
Code.
2.23 "Effective Date" is defined in the introductory paragraph.
2.24 "Failure" is defined in Section 4.8.1.
2.25 "Final Conveyance" means a conveyance, in a form reasonably acceptable to the City,
by the Developer to the City of title to an Authorized Improvement and, if applicable, of the real
property interest(s) necessary, as is reasonably determined by the City, for such Authorized
Improvement.
2.26 "Interim Conveyance" means a conveyance, in a form reasonably acceptable to the
City, by the Developer to the City of an easement within which the applicable Authorized
Improvement(s) are located.
2.27 "Maturity Date" is the date one year after the last Annual Installment is collected.
2.28 "Party" and "Parties" are defined in the introductory paragraph.
2.29 "PID" is defined as the Northwest Passage Public Improvement District created by the
PID Creation Resolution.
2.30 "PID Creation Resolution" is defined as Resolution No. 2021-RO363 passed and
approved by the City Council on September 14, 2021.
2.31 "PID Proceedings" means the PID Creation Resolution, the Assessment Ordinance, the
SAP, and all other documents and proceedings concerning or related to the PID or its creation or
operation.
2.32 "PID Reimbursement Fund" means the fund established by the City under this
Agreement (and segregated from all other funds of the City) into which the City deposits Assessment
Revenues.
2.33 "Purchase Date" means (a) with respect to the Purchased Authorized Improvements,
June 30, 2028, and (b) with respect to any other Authorized Improvements purchased hereunder, the
date of purchase thereof.
2.34 "Purchase Price" means, with respect to Authorized Improvements purchased by the
City hereunder, the portion of the Reimbursement Agreement Balance allocable to the applicable
Authorized Improvements as of the applicable Purchase Date therefor.
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2.35 "Purchased Authorized Improvements" means all of the Authorized Improvements,
except: (a) the portion of the Authorized Improvements for which Developer has, prior to the Purchase
Date for the Purchased Authorized Improvements, received the Reimbursement Agreement Balance
allocable thereto, and (b) the Authorized Improvements for which, prior to the Purchase Date for the
Purchased Authorized Improvements, the City has accepted a Final Conveyance.
2.36 "Reimbursement Agreement Balance" is defined in Section 3.3.
2.37 "SAP" is defined as the Service and Assessment Plan approved by the Assessment
Ordinance, as the same may be updated or amended by City Council action in accordance with the
Act.
2.38 "Transfer" and "Transferee" are defined in Section 4.10.
SECTION 3. FUNDING AUTHORIZED IMPROVEMENTS
3.1 Fund Deposits. The City shall bill, collect, and immediately deposit into the PID
Reimbursement Fund all Assessment Revenue consisting of. (1) revenue collected from the payment
of Assessments (including pre -payments and amounts received from the foreclosure of liens but
excluding costs and expenses related to collection); and (2) revenue collected from the payment of
Annual Installments (excluding costs and expenses related to collection). Annual Installments shall be
billed and collected by the City (or by any 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. Funds in
the PID Reimbursement Fund shall only be used to pay Actual Costs of the Authorized Improvements
or all or any portion of the Reimbursement Agreement Balance in accordance with this Agreement.
The City will take and pursue all commercially reasonable actions permissible under Applicable Laws
to cause the Assessments to be collected and the liens related to such Assessments to be enforced
continuously, in the manner and to the maximum extent permitted by the Applicable Laws, and, to the
extent permitted by Applicable Laws, to cause no reduction, abatement or exemption in the
Assessments for so long as any Reimbursement Agreement Balance remains outstanding. The City
shall determine or cause to be determined, no later than February 15th of each year whether any Annual
Installment is delinquent and if such delinquencies exist, the City will order and cause to be
commenced as soon as practicable any and all appropriate and legally permissible actions to obtain
such Annual Installment, and any delinquent charges and interest thereon, including diligently
prosecuting an action to foreclose the currently delinquent Annual Installment; provided, however, the
City shall not be required under any circumstances to purchase or make payment for the purchase of
the delinquent Assessment or the corresponding Assessed Property.
3.2 Payment of Actual Costs. The Developer may elect to make Developer Advances to
pay Actual Costs. The Developer shall also make Developer Advances to pay for cost overruns (after
applying cost savings).
3.3 Payment of Reimbursement Agreement Balance. The City agrees to pay to the
Developer, and the Developer shall be entitled to receive payments from the City, until the Maturity
Date, for amounts shown on each Approved Certificate for Payment (which amounts include all Actual
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Costs paid by or at the direction of the Developer) plus: (1) interest on the unpaid principal balance at
the rate of five percent (5%) above the highest average index rate for tax-exempt bonds reported in a
daily or weekly bond index reported in the month before the date of determination (which date is the
same as the Effective Date) for years one through five beginning on the date each Approved Certificate
for Payment is delivered to a City Representative; and (2) interest on the unpaid principal balance at
the rate of two percent (2%) above the highest average index rate for tax-exempt bonds reported in a
daily or weekly bond index reported in the month before the date of determination (which date is the
same as the Effective Date) for year six and each year thereafter (the unpaid principal balance, together
with accrued but unpaid interest, owed the Developer for all Approved Certificates for Payment is
referred to as the "Reimbursement Agreement Balance"). The interest rates set forth in this section
have been approved by the City Council and are authorized by the Act. The Reimbursement
Agreement Balance is payable solely from the PID Reimbursement Fund; and, no other City funds,
revenue, taxes, income, or property shall be used even if the Reimbursement Agreement Balance is
not paid in full by the Maturity Date. Payments made from the PID Reimbursement Fund toward any
outstanding Reimbursement Agreement Balance, shall first be applied to unpaid interest on such
Reimbursement Agreement Balance owed to the Developer, and second to unpaid principal of the
Reimbursement Agreement Balance owed to the Developer. Each payment from the PID
Reimbursement Fund shall be accompanied by an accounting that certifies the Reimbursement
Agreement Balance as of the date of the payment and that itemizes all deposits to and disbursements
from the fund since the last payment. If there is a dispute over the amount of any 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 payment is made; however, if the Parties are unable to resolve the
disputed amount, then the City's determination of the disputed amount (as approved by the City
Council) shall control.
3.4 Obligations Limited. The obligations of the City under this Agreement shall not, under
any circumstances, give rise to or create a charge against the general credit or taxing power of the City
or a debt or other obligation of the City payable from any source other than the PID Reimbursement
Fund and, as it relates to Section 3.8 only, the Drainage Utility Fund(s). Unless approved by a City
Representative in writing, no other City funds, revenues, taxes, or income of any kind shall be used to
pay: (1) the Actual Costs of the Authorized Improvements; or (2) the Reimbursement Agreement
Balance even if the Reimbursement Agreement Balance is not paid in full on or before the Maturity
Date. None of the City or any of its elected or appointed officials or any of its officers, employees,
legal counsel (including bond counsel), consultants or representatives (collectively, the "City Related
Parties") shall incur any liability hereunder to the Developer or any other party in their individual
capacities by reason of this Agreement or the PID Proceedings or their acts or omissions under or
related thereto. Without limiting the generality of the immediately preceding sentence, the Parties
waive and release all claims against the City Related Parties related to the PID Proceedings.
Notwithstanding anything to the contrary herein, the City reserves the right, which it may
exercise in its sole discretion, to purchase all or any portion of the Authorized Improvements from
lawfully available sources, which may include sources other than the PID Reimbursement Fund, for
the Purchaser Price therefor. In the event that the City purchases any Authorized Improvements, the
Developer shall make a Final Conveyance of the Authorized Improvements to the City and shall
simultaneously execute and deliver to the City an Assignment of Assessment Revenues in the form
attached hereto as Exhibit B.
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3.5 Obligation to Pay. The Parties agree that when one or more Authorized Improvements
have been Completed, the Developer may provide a Certificate for Payment to the City related to such
Authorized Improvements. The City shall review each Certificate for Payment within a reasonable
period of time and shall inspect the Authorized Improvement(s) included therein to confirm that the
work has been Completed. If the City determines that the applicable Authorized Improvement(s)
has/have been Completed and that the Certificate for Payment is in order, the City shall execute and
return the Approval Form. Subject to the limitations on payment provided in Section 3.4 and other
limitations contained in this Agreement, once the City executes and returns an Approval Form for one
or more Authorized Improvements, the obligations of the City under this Agreement to pay
disbursements from the PID Reimbursement Fund (whether to the Developer or to any person
designated by the Developer) identified in any Certificate for Payment are unconditional AND NOT
subject to any defenses or rights of offset.
Concurrently with this Agreement, the Developer shall submit Certificate for Payment #1
attached hereto as Exhibit C and the City agrees that a City Representative shall execute and return
the Approval Form attached to same.
3.6 City Delegation of Authority. All Authorized Improvements shall be constructed by or
at the direction of the Developer in accordance with the plans and in accordance with this Agreement
and any other agreement between the parties related to property in the PID. The Developer shall
perform, or cause to be performed, all of its obligations and shall conduct, or cause to be conducted,
all operations with respect to the construction of Authorized Improvements in a good, workmanlike
and commercially reasonable manner, with the standard of diligence and care normally employed by
duly qualified persons utilizing their commercially reasonable efforts in the performance of
comparable work and in accordance with generally accepted practices appropriate to the activities
undertaken. The Developer has sole responsibility of ensuring that all Authorized Improvements are
constructed in a good, workmanlike and commercially reasonable manner, with the standard of
diligence and care normally employed by duly qualified persons utilizing their commercially
reasonable efforts in the performance of comparable work and in accordance with generally accepted
practices appropriate to the activities undertaken. The Developer shall employ at all times adequate
staff or consultants with the requisite experience necessary to administer and coordinate all work
related to the design, engineering, acquisition, construction and installation of all Authorized
Improvements to be acquired and accepted by the City from the Developer. If any Authorized
Improvements are or will be on land owned by the City, the City hereby grants to the Developer a
license to enter upon such land for purposes related to construction (and maintenance pending
acquisition and acceptance) of the Authorized Improvements. Inspection and acceptance of
Authorized Improvements will be in accordance with applicable City ordinances and regulations,
except as otherwise provided herein.
3.7 Interim Conveyance of Authorized Improvements. Following receipt of an Approval
Form for one or more Authorized Improvements, the Developer may make an Interim Conveyance of
such Authorized Improvement(s). The Developer shall not make a Final Conveyance of any
Authorized Improvement, except: (a) in accordance with Section 3.8 below, or (b) in the event that
the City has already paid the Developer the entire Purchase Price therefor. The Developer understands
and agrees that if the Developer makes a Final Conveyance of any Authorized Improvement that is
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unauthorized by the immediately preceding sentence, the City will only be obligated to pay the
Developer for such Authorized Improvement solely from the PID Reimbursement Fund in accordance
with Section 3.3 above.
3.8 Purchase Date. Subject to the provisions of this Section, the City agrees to purchase
the Purchased Authorized Improvements on the Purchase Date for the Purchase Price therefor. The
City's purchase obligation under this Section is payable solely from the PID Reimbursement Fund,
provided that if there are insufficient funds in the PID Reimbursement Fund to pay such amount, the
balance shall be paid out of the Drainage Utility Fund(s). No City funds, revenue, taxes, income, or
property other than the PID Reimbursement Fund and the Drainage Utility Fund(s) shall be used to
satisfy the City's purchase obligation under this Section.
To the extent that the PID Reimbursement Fund and the Drainage Utility Fund(s) are
insufficient to pay the Purchase Price on the Purchase Date, the City shall purchase the portion of the
Purchased Authorized Improvements on the Purchase Date that may be purchased from the funds on
hand in the PID Reimbursement Fund and the Drainage Utility Fund(s). All Authorized Improvements
that have not been purchased by the City at such time shall be subject to reimbursement solely from
the PID Reimbursement Fund until the Maturity Date as set forth in Section 3.3 above.
The Parties understand and agree that the City's obligations in this Section are limited to the
extent that they are permitted by applicable Texas and other law. To the extent that the City's
obligations to purchase the Purchased Authorized Improvements are not permitted by law, the City
shall continue to pay the Reimbursement Agreement Balance solely from the PID Reimbursement
Fund until the Maturity Date as set forth in Section 3.3 above.
3.9 Final Conveyance, Assignment of Assessment Revenues. In the event that the City
purchases any of the Purchased Authorized Improvements or any other Authorized Improvements
hereunder, the Developer shall simultaneously make a Final Conveyance of such Authorized
Improvements. Prior to making such Final Conveyance, the Developer shall furnish to the City a
preliminary title report for the real property interest(s) related to the Authorized Improvements to be
included in the Final Conveyance. The report shall be made available for City review and approval at
least fifteen (15) business days prior to the schedule date for the Final Conveyance. The City shall
approve the preliminary title report unless it reveals a matter which, in the reasonable judgment of the
City, would materially affect the City's use and enjoyment of the Authorized Improvements. If the
City objects to any preliminary title report, the City shall not be obligated to accept the Final
Conveyance of the applicable Authorized Improvements or make any purchase or payment related
thereto until the Developer has cured the objections to the reasonable satisfaction of the City. The City
shall be under no obligation to accept any Final Conveyance or make any purchase or payment related
thereto unless the related Authorized Improvements have been Completed.
Simultaneously with each Final Conveyance, the Developer shall execute and deliver to the
City an Assignment of Assessment Revenues in the form attached hereto as Exhibit B. The amount
of such Assignment of Assessment Revenues shall be equal to the Purchase Price paid to the Developer
therefor.
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SECTION 4. ADDITIONAL PROVISIONS
4.1 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
Agreement Balance is paid in full.
4.2 No Competitive Bidding. Construction of the Authorized Improvements shall not
require competitive bidding pursuant to Section 252.022(a)(9) of the Texas Local Government
Code, as amended. All plans and specifications, but not construction contracts, shall be reviewed
and approved, in writing, by the City prior to Developer selecting the contractor. The City shall
have the right to examine and approve the contractor selected by the Developer prior to executing
a construction contract with the contractor, which approval shall not be unreasonably delayed or
withheld.
4.3 Independent Contractor. In performing this Agreement, the Developer is an
independent contractor and not the agent or employee of the City.
4.4 Audit. Each City Representative shall have the right, during normal business hours
and upon five (5) business days' prior written notice to the Developer, to review all books and
records of the Developer pertaining to costs and expenses incurred by the Developer with respect
to any of the Authorized Improvements. For a period of two years after completion of the
Authorized Improvements, the Developer shall maintain proper books of record and account for
the construction of the Authorized Improvements and all costs related thereto. Such accounting
books shall be maintained in accordance with customary real estate accounting principles. The
Developer shall have the right, during normal business hours, to review all records and accounts
pertaining to the Assessments upon written request to the City. The City shall provide the
Developer an opportunity to inspect such books and records relating to the Assessments during the
City's regular business hours and on a mutually agreeable date no later than ten (10) business days
after the City receives such written request. The City shall keep and maintain a proper and
complete system of records and accounts pertaining to the Assessments for so long as any
Reimbursement Agreement Balance remains unpaid.
4.5 Developer's Right to Protest Ad Valorem Taxes. Nothing in this Agreement shall
be construed to limit or restrict Developer's right to protest ad valorem taxes. The Developer's
decision to protest ad valorem taxes on Assessed Property does not constitute a Default under this
Agreement.
4.6 PID Administration and Collection of Assessments. If the City designates an
administrator who shall have the responsibilities provided in the SAP related to the duties and
responsibilities of the administration of the PID, the City shall provide the Developer with a copy
of the agreement between the City and the administrator. If the City contracts with a third -party
for the collection of Annual Installments of the Assessments, the City shall provide the Developer
with a copy of such agreement. For so long as the Reimbursement Agreement Balance remains
unpaid, the City shall notify the Developer of any change of administrator or third -party collection
of the Assessments.
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4.7 Representations and Warranties.
4.7.1 The Developer represents and warrants to the City that: (1) the Developer has
the authority to enter into and perform its obligations under this Agreement; (2) the Developer
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 the
Developer has been duly authorized to do so; (4) this Agreement is binding upon the Developer
in accordance with its terms; and (5) the execution of this Agreement and the performance by
the Developer of its obligations under this Agreement do not constitute a breach or event of
default by the Developer under any other agreement, instrument, or order to which the
Developer is a party or by which the Developer is bound.
4.7.2 The City represents and warrants to the Developer 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.
4.8 Default/Remedies.
4.8.1 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 10 days within which to cure. If the Failure
is non -monetary, the non -performing Party shall have 30 days within which to cure.
4.8.2 If the Developer is in Default, the City shall have available all remedies at law
or in equity; provided no default by the Developer shall entitle the City to terminate this
Agreement or to withhold payments to the Developer from the PID Reimbursement Fund.
4.8.3 If the City is in Default, the Developer shall have available all remedies at law
or in equity; provided, however, no Default by the City shall entitle the Developer to terminate
this Agreement.
4.8.4 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 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.
4.9 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 the Developer, any
Transferee, or any other person or entity involved in the design, construction, or installation of the
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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 property in the PID.
4.10 Transfers. Except with respect to any payments assigned to the City in accordance with
Section 3.6 above, the Developer has the right to convey, transfer, assign, mortgage, pledge, or
otherwise encumber, in whole or in part without the consent of (but with notice to) the City, the
Developer's right, title, or interest to payments under this Agreement (but not performance
obligations) including, but not limited to, any right, title, or interest of the Developer in and to
payments of the Reimbursement Agreement Balance, whether such payments are from the PID
Reimbursement Fund in accordance with Section 3.3 (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 notice of the Transfer is given to the City. 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 third
party as a result of a Transfer for which the City received notice.
4.11 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 Lubbock County, Texas.
4.12 Notice. Any notice referenced in 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) 72 hours after deposited with the
United States Postal Service, Certified Mail, Return Receipt Requested.
To the City: Attn: City Manager
City of Lubbock
P.O. Box 2000
Lubbock, Texas 79457
E-mail: JAtkinson@mylubbock.us
With a copy to: Attn: City Attorney
City of Lubbock
P.O. Box 2000
Lubbock, Texas 79457
E-mail: cweaver@mylubbock.us
To the Developer: Attn: Marc McDougal
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4139-1575-6085.1
MM Holdsworth NWP, LLC
1500 Broadway St Suite 1400
Lubbock, TX 79401
E-mail: marcm@mcdougal.com
With a copy to: Mont McClendon
Email: mont.mcclendon@mcdougal.com
Any Party may change its address by delivering notice of the change in accordance with this
section.
4.13 Amendment. This Agreement may only be amended by written agreement of the
Parties.
4.14 Severability. If any provision of this Agreement is held invalid by any court, such
holding shall not affect the validity of the remaining provisions.
4.15 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.
4.16 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, the Developer, and Transferees 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, the Developer, and Transferees.
4.17 Counterparts. This Agreement may be executed in multiple counterparts, which, when
taken together, shall be deemed one original.
4.18 Anti -Boycott Verification. To the extent this Agreement constitutes a contract for
goods or services for which a written verification is required under Section 2271.002, Texas
Government Code, the Developer hereby verifies that it and its parent company, wholly- or majority -
owned subsidiaries, and other affiliates, if any, do not boycott Israel and will not boycott Israel during
the term of this Agreement. The foregoing verification is made solely to enable the City to comply
with such Section and to the extent such Section does not contravene applicable Federal or Texas law.
As used in the foregoing verification, "boycott Israel," a term defined in Section 2271.001, Texas
Government Code, by reference to Section 808.001(1), Texas Government Code, means refusing to
deal with, terminating business activities with, or otherwise taking any action that is intended to
penalize, inflict economic harm on, or limit commercial relations specifically with Israel, or with a
person or entity doing business in Israel or in an Israeli -controlled territory, but does not include an
action made for ordinary business purposes.
4.19 No Boycott of Israel. The Developer represents that neither it nor any of its parent
company, wholly- or majority -owned subsidiaries, and other affiliates is a company identified on a list
prepared and maintained by the Texas Comptroller of Public Accounts under Section 2252.153 or
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4139-1575-6085 1
Section 2270.0201, Texas Government Code, and posted on such officer's internet website. The
foregoing representation is made solely to enable the City to comply with Section 2252.152, Texas
Government Code, and to the extent such Section does not contravene applicable Federal or Texas
law and excludes the Developer and each of its parent company, wholly- or majority -owned
subsidiaries, and other affiliates, if any, that the United States government has affirmatively declared
to be excluded from its federal sanctions regime relating to Sudan or Iran or any federal sanctions
regime relating to a foreign terrorist organization.
4.20 No Discrimination Against Fossil -Fuel Companies. To the extent this Agreement
constitutes a contract for goods or services for which a written verification is required under Section
2274.002 (as added by Senate Bill 13 in the 87th Texas Legislature, Regular Session), Texas
Government Code, as amended, the Developer hereby verifies that it and its parent company, wholly -
or majority -owned subsidiaries, and other affiliates, if any, do not boycott energy companies and will
not boycott energy companies during the term of this Agreement. The foregoing verification is made
solely to enable the City to comply with such Section and to the extent such Section does not
contravene applicable Federal or Texas law. As used in the foregoing verification, "boycott energy
companies," a term defined in Section 2274.001(1), Texas Government Code (as enacted by such
Senate Bill) by reference to Section 809.001, Texas Government Code (also as enacted by such Senate
Bill), shall mean, without an ordinary business purpose, refusing to deal with, terminating business
activities with, or otherwise taking any action that is intended to penalize, inflict economic harm on,
or limit commercial relations with a company because the company (A) engages in the exploration,
production, utilization, transportation, sale, or manufacturing of fossil fuel -based energy and does not
commit or pledge to meet environmental standards beyond applicable federal and state law; or (B)
does business with a company described by (A) above.
4.21 No Discrimination Against Firearm Entities and Firearm Trade Associations. To the
extent this Agreement constitutes a contract for goods or services for which a written verification is
required under Section 2274.002 (as added by Senate Bill 19 in the 87th Texas Legislature, Regular
Session), Texas Government Code, as amended, the Developer hereby verifies that it and its parent
company, wholly- or majority -owned subsidiaries, and other affiliates, if any, do not have a practice,
policy, guidance, or directive that discriminates against a firearm entity or firearm trade association
and will not discriminate against a firearm entity or firearm trade association during the term of this
Agreement. The foregoing verification is made solely to enable the City to comply with such Section
and to the extent such Section does not contravene applicable Federal law.
As used in the foregoing verification and the following definitions,
a. "discriminate against a firearm entity or firearm trade association," a term
defined in Section 2274.001(3), Texas Government Code (as enacted by such Senate Bill),
(A) means, with respect to the firearm entity or firearm trade association, to (i) refuse to
engage in the trade of any goods or services with the firearm entity or firearm trade
association based solely on its status as a firearm entity or firearm trade association, (ii)
refrain from continuing an existing business relationship with the firearm entity or firearm
trade association based solely on its status as a firearm entity or firearm trade association,
or (iii) terminate an existing business relationship with the firearm entity or firearm trade
association based solely on its status as a firearm entity or firearm trade association and
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4139-1575-6085.1
(B) does not include (i) the established policies of a merchant, retail seller, or platform that
restrict or prohibit the listing or selling of ammunition, firearms, or firearm accessories and
(ii) a company's refusal to engage in the trade of any goods or services, decision to refrain
from continuing an existing business relationship, or decision to terminate an existing
business relationship (aa) to comply with federal, state, or local law, policy, or regulations
or a directive by a regulatory agency or (bb) for any traditional business reason that is
specific to the customer or potential customer and not based solely on an entity's or
association's status as a firearm entity or firearm trade association,
b. "firearm entity," a term defined in Section 2274.001(6), Texas Government
Code (as enacted by such Senate Bill), means a manufacturer, distributor, wholesaler,
supplier, or retailer of firearms (defined in Section 2274.001(4), Texas Government Code,
as enacted by such Senate Bill, as weapons that expel projectiles by the action of explosive
or expanding gases), firearm accessories (defined in Section 2274.001(5), Texas
Government Code, as enacted by such Senate Bill, as devices specifically designed or
adapted to enable an individual to wear, carry, store, or mount a firearm on the individual
or on a conveyance and items used in conjunction with or mounted on a firearm that are
not essential to the basic function of the firearm, including detachable firearm magazines),
or ammunition (defined in Section 2274.001(1), Texas Government Code, as enacted by
such Senate Bill, as a loaded cartridge case, primer, bullet, or propellant powder with or
without a projectile) or a sport shooting range (defined in Section 250.001, Texas Local
Government Code, as a business establishment, private club, or association that operates
an area for the discharge or other use of firearms for silhouette, skeet, trap, black powder,
target, self-defense, or similar recreational shooting), and
C. "firearm trade association," a term defined in Section 2274.001(7), Texas
Government Code (as enacted by such Senate Bill), means any person, corporation,
unincorporated association, federation, business league, or business organization that (i) is
not organized or operated for profit (and none of the net earnings of which insures to the
benefit of any private shareholder or individual), (ii) has two or more firearm entities as
members, and (iii) is exempt from federal income taxation under Section 501(a), Internal
Revenue Code of 1986, as an organization described by Section 501(c) of that code.
4.22 Affiliate. As used in Sections 4.18 through 4.21, the Developer understands "affiliate"
to mean an entity that controls, is controlled by, or is under common control with the Developer within
the meaning of SEC Rule 405, 17 C.F.R. § 230.405, and exists to make a profit.
[Execution pages follow. ]
Page 14
4139-1575-6085.1
CITY OF LUBBOCK, TEXAS
By:
a)ve-
Daniel M. Pope, Mayor
ATTEST:
By:
Re e a Garza, Ci4Secreta
APPROVED AS TO CONTENT:
By:
D. Blu K stelich, Chief Financial Officer
APPROVED AS TO FORM:
By: C§�
Jerry Kyle, Bond Counsel
CITY SIGNATURE PAGE TO REIMBURSEMENT AGREEMENT
NORTHWEST PASSAGE PUBLIC IMPROVEMENT DISTRICT
4139-1575-6085.1
MM Holdsworth NWP, LLC,
a Texas limited liability company
By:
McDougal, Manager
By±
Mont McClendon, Manager
DEVELOPER SIGNATURE PAGE TO REIMBURSEMENT AGREEMENT
NORTHWEST PASSAGE PUBLIC IMPROVEMENT DISTRICT
4139-1575-6085.1
EXHIBIT A
Certificate for Payment Form
The undersigned is an agent for MM Holdsworth NWP, LLC, a Texas limited liability
company (the "Developer') and requests payment from the applicable account of the PID
Reimbursement Fund from the City of Lubbock, Texas (the "City") in the amount of
for labor, materials, fees, and/or other general costs related to the creation, acquisition, or
construction of certain Authorized Improvements providing a special benefit to property within
the Northwest Passage Public Improvement District. Unless otherwise defined, any capitalized
terms used herein shall have the meanings ascribed to them in the PID Reimbursement Agreement
(the "Reimbursement Agreement").
In connection with the above referenced payment, the Developer represents and warrants
to the City as follows:
I. The undersigned is a duly authorized officer of the Developer, is qualified to
execute this Certificate for Payment Form on behalf of the Developer and is knowledgeable as to
the matters set forth herein.
2. The payment requested for the below referenced Authorized Improvements has not
been the subject of any prior payment request submitted for the same work to the City or, if
previously requested, no disbursement was made with respect thereto.
3. The amount listed for the Authorized Improvements below is a true and accurate
representation of the Actual Costs associated with the creation, acquisition, or construction of said
Authorized Improvements, and such costs (i) are in compliance with the Reimbursement
Agreement, and (ii) are consistent with the Service and Assessment Plan.
4. The Developer is in compliance with the terms and provisions of the
Reimbursement Agreement and the Service and Assessment Plan.
5. The Developer has timely paid all ad valorem taxes and annual installments of
special assessments it owes or an entity the Developer controls owes, located in the Northwest
Passage Public Improvement District and has no outstanding delinquencies for such assessments.
6. The work with respect to each Authorized Improvement referenced below (or its
completed segment) has been completed, and the City has inspected each such Authorized
Improvement (or its completed segment).
7. The Developer agrees to cooperate with the City in conducting its review of the
requested payment and agrees to provide additional information and documentation as is
reasonably necessary for the City to complete said review.
8. No more than ninety-five percent (95%) of the budgeted or contracted hard costs
for the Authorized Improvements (or segment thereof) identified may be paid until the work with
respect to such Authorized Improvements (or segment thereof) has been completed and the City
EXHIBIT A -- PAGE 1
4139-1575-6085 1
has accepted such Authorized Improvements (or segment thereof). One hundred percent (100%)
of soft costs (e.g., engineering costs, inspection fees and the like) may be paid prior to City
acceptance of such Authorized Improvements (or segment thereof).
Payments requested are as follows:
a. X amount to Person or Account Y for Z goods or services.
b. Etc.
Attached hereto are receipts, purchase orders, change orders, and similar instruments which
support and validate the above requested payments. Also attached hereto are "bills paid" affidavits
and supporting documentation in the standard form for City construction projects.
Pursuant to the Reimbursement Agreement, after receiving this payment request, the City
has inspected each Authorized Improvement (or completed segment) and confirmed that said work
has been completed in accordance with approved plans and all applicable governmental laws,
rules, and regulations.
EXHIBIT A -PAGE 2
4139-1575-6085 1
I hereby declare that the above representations and warranties are true and correct.
MM Holdsworth NWP, LLC,
a Texas limited liability company
Marc McDougal, Manager
Mont McClendon, Manager
EXHIBIT A - PAGE 3
4139-1575-6085.1
APPROVAL OF REQUEST BY CITY
The City is in receipt of the attached Certificate for Payment, acknowledges the Certificate for
Payment, acknowledges that each Authorized Improvement (or its completed segment) covered
by the certificate have been inspected by the City, and otherwise finds the Certificate for Payment
to be in order. After reviewing the Certificate for Payment, the City approves the Certificate for
Payment and shall direct payment from the PID Reimbursement Fund to the Developer or to any
person designated by the Developer.
CITY OF LUBBOCK, TEXAS
By:
Name:
Title:
Date:
EXHIBIT A - PAGE 4
4139-1575-6085.1
EXHIBIT B
Form Assignment of Assessment Revenues
ASSIGNMENT OF ASSESSMENT REVENUES
This Assignment of Assessment Revenues is being executed on this , 20_,
pursuant to that certain PID Reimbursement Agreement (this "Agreement") entered into by MM
Holdsworth NWP, LLC, a Texas limited liability company (the "Developer") and the City of
Lubbock, Texas (the "City"), effective , 2022. Capitalized terms not otherwise
defined herein shall have the meaning assigned to such terms in the Agreement.
In exchange for the City's payment in the amount of $ (the "Purchase
Price") in order to purchase some or all of the Authorized Improvements, the Developer hereby
assigns and transfers unto the City all right, title and interest to receive an amount of the
Reimbursement Agreement Balance equal to the Purchase Price. The Developer agrees to execute
any additional documents as may be reasonably requested by the City in connection with this
Assignment of Assessment Revenues whether to evidence the assignment contemplated hereunder
or otherwise.
MM Holdsworth NWP, LLC,
a Texas limited liability company
Marc McDougal, Manager
Mont McClendon, Manager
EXHIBIT B- PAGE 1
4139-1575-6085.1
EXHIBIT C
Form of Certificate for Payment #1
The undersigned is an agent for MM Holdsworth NWP, LLC, a Texas limited liability
company (the "Developer') and requests payment from the applicable account of the PID
Reimbursement Fund from the City of Lubbock, Texas (the "City") in the amount of $184,032.60
for labor, materials, fees, and/or other general costs related to the creation, acquisition, or
construction of certain Authorized Improvements providing a special benefit to property within
the Northwest Passage Public Improvement District. Unless otherwise defined, any capitalized
terms used herein shall have the meanings ascribed to them in the PID Reimbursement Agreement
(the "Reimbursement Agreement").
In connection with the above referenced payment, the Developer represents and warrants
to the City as follows:
1. The undersigned is a duly authorized officer of the Developer, is qualified to
execute this Certificate for Payment Form on behalf of the Developer and is knowledgeable as to
the matters set forth herein.
2. The payment requested for the below referenced Authorized Improvements has not
been the subject of any prior payment request submitted for the same work to the City or, if
previously requested, no disbursement was made with respect thereto.
3. The amount listed for the Authorized Improvements below is a true and accurate
representation of the Actual Costs associated with the creation, acquisition, or construction of said
Authorized Improvements, and such costs (i) are in compliance with the Reimbursement
Agreement, and (ii) are consistent with the Service and Assessment Plan.
4. The Developer is in compliance with the terms and provisions of the
Reimbursement Agreement and the Service and Assessment Plan.
5. The Developer has timely paid all ad valorem taxes and annual installments of
special assessments it owes or an entity the Developer controls owes, located in the Northwest
Passage Public Improvement District and has no outstanding delinquencies for such assessments.
6. The work with respect to each Authorized Improvement referenced below (or its
completed segment) has been completed, and the City has inspected each such Authorized
Improvement (or its completed segment).
7. The Developer agrees to cooperate with the City in conducting its review of the
requested payment and agrees to provide additional information and documentation as is
reasonably necessary for the City to complete said review.
8. No more than ninety-five percent (95%) of the budgeted or contracted hard costs
for the Authorized Improvements (or segment thereof) identified may be paid until the work with
respect to such Authorized Improvements (or segment thereof) has been completed and the City
EXHIBIT C PAGE 1
4139-1575-6085.1
has accepted such Authorized Improvements (or segment thereof). One hundred percent (100%)
of soft costs (e.g., engineering costs, inspection fees and the like) may be paid prior to City
acceptance of such Authorized Improvements (or segment thereof).
Payments requested are as follows:
a. $184,032.60 to Developer or its assignee for drainage design services.
Attached hereto are receipts, purchase orders, change orders, and similar instruments which
support and validate the above requested payments. Also attached hereto are "bills paid" affidavits
and supporting documentation in the standard form for City construction projects.
Pursuant to the Reimbursement Agreement, after receiving this payment request, the City
has inspected each Authorized Improvement (or completed segment) and confirmed that said work
has been completed in accordance with approved plans and all applicable governmental laws,
rules, and regulations.
I hereby declare that the above representations and warranties are true and correct.
MM Holdsworth NWP, LLC,
a Texas limite liability company
By:
M rc McDougal, Manager
B ---
Mont McClendon, Manager
EXHIBIT C-- PAGE 2
4139-1575-6085.1
APPROVAL OF REQUEST BY CITY
The City is in receipt of the attached Certificate for Payment, acknowledges the Certificate for
Payment, acknowledges that each Authorized Improvement (or its completed segment) covered
by the certificate have been inspected by the City, and otherwise finds the Certificate for Payment
to be in order. After reviewing the Certificate for Payment, the City approves the Certificate for
Payment and shall direct payment from the PID Reimbursement Fund to the Developer or to any
person designated by the Developer.
CITY OF LUBBOCK, TEXAS
By:
Name:
Title:
Date:
EXHIBIT C- PAGE 3
4139-1575-6085.1