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Home My WebLink About08-04-08 Special Called Regular Meeting of the La Porte Development Corporation Board of Directors 2 MINUTES OF THE SPECIAL CALLED REGULAR MEETING OF THE DEVELOPMENT CORPORATION BOARD OF DIRECTORS August 4, 2008 1. Call to order President Pat Muston called the meeting to order at 6:00 p.m. Members Present: Love, Muston, Clausen, Matuszak, Moser and Beasley Members/Officers Absent: Engelken Staff Present: City Manager Ron Bottoms, Director of Finance Michael Dolby, Economic Development Coordinator Gretchen Larson, Assistant City Secretary Sharon Harris, and Assistant City Attorney Clark Askins. Others Present: 2. Consider approval of minutes of Special Called Regular Meeting of the La Porte Development Corporation Board of Directors, held on July 21, 2008. A motion was made by Board Member Clausen to approve the Minutes of July 21, 2008 of the Special Called Regular Meeting of the La Porte Development Board. The motion was seconded by Board Member Beasley. The motion carried. Ayes: Love, Muston, Clausen and Beasley Nays: None Abstain: Matuszak and Moser Absent: Engelken 3. Consider approval or other action regarding a contract between the La Porte Development Corporation Board and Avalanche Consulting, Inc, for the completion of a City-Wide Economic Development Strategic Plan. Development Coordinator Gretchen Larson made the presentation and recommendation and answered questions of the Board. Motion was made by Board Member Beasley to authorize the approval of a contract with Avalanche Consulting, Inc. for the completion of a City-Wide Economic Development Strategic Plan as recommended by Ms. Larson. The motion was seconded by Board Member Love. The motion carried. Ayes: Love, Muston, Clausen, Matuszak, Moser and Beasley Nays: None Abstain: None Absent: Engelken 4. The Special Called Regular Meeting was closed and the Workshop Meeting was opened at 6:07 p.m. A. Director of Finance Michael Dolby and Economic Development Coordinator Gretchen Larson discussed the 2008-2009 Budget for the La Porte Development Corporation Board and answered questions from board members. .-/ 5. The Workshop Meeting was closed and the Special Called Regular Meeting reconvened at 6:17 p.m. 6. Consider approval or other action adopting the Fiscal Year 2008-2009 Budget for the La Porte Development Corporation Board. Economic Development Coordinator Gretchen Larson made the presentation and recommendation and answered questions of the Board. Motion was made by Board Member Matuszak to adopt the Fiscal Year 2008-2009 Budget for the La Porte Development Corporation Board. The motion was seconded by Board Member Beasley. The motion carried. Ayes: Love, Muston, Clausen, Matuszak, Moser and Beasley Nays: None Abstain: None Absent: Engelken 7. Announcements/ Administrative Reports Economic Development Coordinator Gretchen Larson provided announcements on the following items: La Porte Development Corporation Board of Directors Meeting September 10, 2008 - 6:00 p.m. Update on Community Branding Campaign Update on Website Refurbishment 8. Board Comments There were not any comments from Board members 9. Executive Session- pursuant to provision of the Open Meetings Law. Chapter 551 Texas Government Code, Sections 551-071 through 551.076, 551.087 (consultation with attorney, deliberation regarding real property, deliberation regarding prospective gift or donation, personnel matters, deliberation regarding security devices, or excluding a witness during examination of another witness in an investigation, deliberation regarding Economic Development Negotiations). The Board retired to Executive Session at 6:34 p.m. A. Section 551.087 - (Economic Development Negotiations) Meet with City Manager, City Attorney and Economic Development Coordinator to discuss terms and conditions of the proposed Development Agreement for the creation of the Town Plaza at the intersection of East and West Main, San Jacinto and South Broadway B. Section 551.072 - (Purchase, exchange, lease or value of real property) Meet with City Manager, City Attorney and Economic Development Coordinator to discuss proposed property purchase The Board reconvened the Special Called Regular meeting at 7:21 p.m. 10. Consideration and possible action on items considered in Executive Session. There was no action taken in the Executive Session 11. Adjournment The meeting was duly adjourned at 7:22 p.m. Respectfully submitted, ~~j~ Assistant City Secretary TRMC P1U- a'JP\~iS 10. day of September 2008. ~ Mustin, ~resident 3 :em gn ~o g::J ci'O ~3~ ~ -- ~. n g)> - - -- OJ ::J n CD m s:::: en -. ~ CD en en ::tJ -C~ ...CD o ~ (Q~ "'0 Q) ~ 3Qo m >< -c Q) ~ en -. o ~ Business Retention & Expansion Program . New Industry . Business Retention & Expansion . Commercial/Retail \, \ '\ \ t \ , I I , II .....'--l..__..-'~<..... o I I I ---I I I ' ---, --I I ---T-'-, I I I _, (-- ! I 7'-~i '-L~ _ \ ., _"j I, 1,. ! -",."-'--. \__~ r...; I 1 . -- - -_...>..........,~}\, " ---------\ "\ " Business Retention & Expansion Program . Economic Development studies support retention as more likely to succeed than marketing to new prospects . Investment in your community is here already . Don't forget that the current businesses are the generators of sales tax . Overall positive for entire community - businesses are the sponsors for school activities, civic donations, volunteering, etc.... Business Retention & Expansion Program . A resident business expects and deserves value each time we interact with them. . No two businesses in your community are the same. Each business has unique needs and potential to generate jobs and capital investment. . The more we interact with a business in our community, the more we should know about the business. We should use this knowledge to create highly customized solutions. . Although the program should be tracked, business retention is not about data gathering - it is building lona-term relationships that give the economic development team an in-depth understanding of the firm, and the ability to customize solutions to solve a problem or seize an opportunity. . As a way to ensure greater community impact, "BR&E" programs are more often designed to target companies that are sometimes "taken for granted" but that would impact multiple jobs (livelihoods in your community) if they were to relocate. Business Retention & Expansion Program . Obtain the following information: Know about products Hiring needs - Workforce needs Need for vendors Retention plans Expansion plans Leads for additional business Business Retention & Expansion Program . We leave them with the following: San Jacinto College programs - Finance programs through the State of Texas or grant processes - Initiatives of Workforce Solutions (previously named WorkSource) - Economic development services (demographic research, etc.) - Link our ideas - Ability to reserve SBOC Satellite Services at Economic Alliance office for Business Planning SoftwarelT ools/Counseling Business Retention & Expansion Program . Understanding of the business in La Porte - Team: City of La Porte, Economic Development Coordinator; CenterPoint Energy; San Jacinto College; Economic Alliance Houston Port Region - 24 per year - Customized solutions - Follow up questions - Thank you to the business Business Retention & Expansion Program Questions Marie McDermott, CEO Business Development Director Economic Alliance Houston Port Region 908 Main St. La Porte, Texas 77571 www.allianceportregion.com City of La Porte Business Retention & Expansion Program In Partnership with the Economic Alliance Houston Port Region EconO~lIiance Houston Port Region ECOnO~lIiance Houston Port Region City of La Porte Business Retention & Expansion Program Among the many initiatives an economic development organization can undertake to help retain and grow local businesses, none is more valuable than building a relationship with a company's top decision makers. Such relationships with primary manufacturers and suppliers enable a community to position itself as a valuable source for information and assistance, further enhancing the community's chances of securing job growth and retention. The City of La Porte, with the assistance of the Economic Alliance Houston Port Region, plans to do just such a BR&E initiative. Existing business is critical for economic development. Studies have shown that up to 80 percent of job growth in any community comes from existing businesses, rather than from new business. It therefore makes good sense to encourage local employers to stay, grow and add more workers. The Business Retention & Expansion program has two key goals: to help local economic developers create a consistent approach for building relationships in their community, and to help the economic development community analyze and understand trends both in their local regions and global market place to foster business retention and expansion. Listening to and learning from our existing employers provides us with clear directives that impact all facets of the economic portfolio, including recruitment and entrepreneurship opportunities. Local companies will openly prescribe a "wish list" of vendors for supplies, business services and a variety of other needs. This target list can be used to spur new business ideas in the entrepreneurial community and attract seed capital. As the community grows and prospers so to do retail and commercial components to round out the overall economy. This multi-phased approach also protects us from sharp downturns in anyone segment of our economy through diversification. Communities can discuss challenges and opportunities around the program, such as how global pressures are impacting a particular industry segment, or workforce issues and skills gaps. This attention encourages the company to continue operating in the local community, in addition to building rapport with company executives. If local businesses are not healthy, new business will not come to a community. Companies participating in the program appreciate the attention to their needs, but the companies are especially grateful that the community recognizes their value and is willing to help them grow. The methodology begins with a letter to the targeted business leaders on behalf of the community. Each letter begins and ends with an expression of gratitude to the business for operating in the community. The letter requests a short time commitment for a conversation about the needs and concerns of the company with a highlight that the call is not a sales call. If we are doing our jobs properly, economic developers will deliver customized, bottom-line benefits to these business constituents. The following four individuals will be the Program Ambassadors as follows: the City of La Porte, Economic Development Coordinator; San Jacinto College, Business Development Manager; CenterPoint Energy, Economic Development Manager; and the Economic Alliance Houston Port Region, Business Development Director. These people can and will bring a customer focus to the businesses. The ultimate reward is hearing area businesses say, "I belong here and my investment is appreciated and valued." Before interviewing a company, the Business Retention & Expansion member will obtain and review valuable data in advance such as type of product, number of employees, NAICS codes, ownership and more. The attached interview guide is only for our general purposes as each visit will be "about" that business' needs. The territory will be the City of La Porte and the extra territorial jurisdiction, Bayport, South La Porte and the Battleground Industrial District areas. There are about 120 companies in the district and we would visit a minimum of 2 per month. There are also many other occasions in which the Economic Alliance staff and the Economic Development Coordinator interact with the local manufacturers. These include the Citizen's Advisory Council to La Porte industry, the La Porte Emergency Operations Center, the Transportation Task Force, the Air Quality Task Force, and the Workforce Task Force. At every opportunity we strive to listen and learn what is happening in the industry so that we can continually refine our business retention and expansion efforts. The suppliers provide needed services to the primary manufacturers. These are firms like Pfeiffer & Sons providing electrical services or Analytic Stress supplying heat treatment and stress relieving equipment. In order for La Porte to get a handle on the issues, we need to contact them. A level of expectation has been set from the beginning that someone will follow up to assist the company with its needs, in addition to sending thank you letters to all company executives. Following the visit, a report will be filed in the Business Retention & Expansion book for reference. Also, we will monitor and follow through we what we learn. We want the company managers to know that we are listening and moving forward on their requests. In summary our local companies are vital to our economy. This Program will build a strong or stronger relationship with a company's top decision makers that will keep us in touch with their needs. From there we will also able to fashion the needed programs and policies that will continue to help them grow and the city to prosper into the future. Business Retention & Expansion Calendar 2008 September 12, 2008 Review the program with Team Members September 19, 2008, 10 am Doug Wene Plant Manager Eurecat U.S. Inc. 13100 Bay Park Road Pasadena. Texas 77507 September 25, 2008, 10:30 am Keith Dooley Works Manager Lubrizol 908 W. Main La Porte, Texas 77571 September 26,2008, 10 am Un Pfeiffer Pfeiffer & Sons 116 North 16th Street La Porte, Texas 77571 October 10, 2008, 10 am Kristen K. Poliafico Site Manager Sunoco 8811 Strang Rd, La Porte site La Porte, Texas Shaw Industries and Zachary (Pending) Frontier Logistics (November) New Orleans Cold Storage (November) DuPont (November) Albemarle Catalysts Co., LP (December) ECOnO~lIiance Houston Port Region LETTER TO THE COMPANY RE: Business Retention & Expansion Dear We appreciate the business you conduct in the City of La Porte; you employ many of the people who reside in La Porte and the dollars that you have invested are valuable. As part of our new initiative in conjunction with the City of La Porte we would like to visit with you and your human resources manager regarding the joint Business Retention and Expansion Program we have developed. The visit would only take about 45 minutes. Through the Program we would learn more about your company and the type of market your products target and the suppliers you need. We would also determine your workforce requirements, highly skilled or semi skilled and necessary training that we could provide support for. Joining me in this visit there will be the City's Economic Development Coordinator, Business Development Manager for San Jacinto College and the Economic Development Specialist for CenterPoint Energy to discuss utility needs. The City of La Porte would like to serve you better by helping where we can to provide services that you need. More than anything, we thank you for the company you have operating here. Sincerely, Marie McDermott Economic Alliance ECOnO~lIiance Houston Port Region Business Retention & Expansion Interview Guide (CONFIDENTIAL: If any of this information is divulged, it will be in aggregate form using all companies interviewed.) Date: Business/Industry Name: Physical Address: Contact Name: President / CEO Email Address: General Manager/Plant Manager Email Address: Human Resources Manager: Email Address: Phone Number: Website Address: Year Company was established (local): Nature of Business: Product or Service: Market Area: City Trade area (200 mile radius) State National Global In the next 3 years, do you expect your business to? Expand Remain the same 1 Decline Capital Investment in the past three years: Facilities Machinery/ equipment Trucks/ Mobile equipment Other Own or Lease this Facility: Other Locations: If leased, does your lease expire within? 1 year 3 year 5-7 year Size of Facility: Office Warehouse Manufacturing Yard Additional space, if expanding: Status of Local Operation (revenue): Industrial District Area: Bayport IDA South La Porte IDA Battleground IDA Resources (raw material, components etc.) dependent upon for operations: Supplier Support Needed: Competitors: Exports/Import Product: Number of Employees: Annual Payroll: Number of Part Time Employees: 2 Employee Turnover: <1% 1 - 3% 3.1 - 5% >5% Workforce Needed: Increasing Reducing Stay the same Workforce Requirements: Highly Skilled # Semi Skilled # Unskilled # Additional Skills Needed: Training Needed: Benefits to Employee: Medical insurance Retirement plan Other Where do you get your employees? How do you recruit? Utilities: Electricity Gas Pipeline Wastewater Air Emissionsl Air Permitting Water Fiber Transportation: Trucks I Highways Rail Port Airport 3 Your opinions are important. Is there anything else you would like to tell us about your business needs? Is the local government responsive to our needs? Or ways we can improve the community's economy? Recommendations: Action: Referred to: Follow up Date: Prepared by: Retention Team Members Present City of La Porte, Economic Development Coordinator: Economic Alliance Houston Port Region San Jacinto College District Work Source: Utilities: Other: Photo for the newspaper Certificate 4 4 ~ ,,- ,,~ 6 (f) co -s- co % co -'\ ~ o ... tv o o C$) ....-\ ~ ::) -0 ...... ~ 0) -0 ~ o. ~ CO ~ --I o ~ :J -u Q) N Q) Revenue Impact Proposed Office Complex 268 indirect jobs 468 total jobs (direct + indirect) $35.5 million increase in GDP Source: Greater Houston Partnership Moving Forward - Review ~ The Project was adopted by the Board July 7; 60 day period for public comments ended September 7 ~ A final Development Agreement is still being drafted; Developer has however agreed to sell the Triangle Property so that we may proceed to next steps for plaza final design, construction bid documents, etc. ~ Developer has requested Memorandum of Understanding (MOU) as interim measure and condition of Triangle Property sale; and may include leasing or loan option related to Developer losses due to plaza construction by city ~ Texas Parks and Wildlife has agreed to sell their 105 San Jacinto location to the Board Moving Forward - Actions Required ~Approve Memorandum of Understanding (MOU) as interim measure and condition of Triangle Property sale ~Agree to purchase the Triangle Property for $150,000 ~Agree to begin process for purchase of Texas Parks and Wildlife 105 San Jacinto location for $450,000 ~---- ---------- 7 REQUEST FOR LPEDC BOARD AGENDA ITEM Agenda Date Requested: 9/2/2008 Bud2et Requested By: Gretchen I.ar!lon Source of Funds: ED Budget Department: City MilliKer/EDC Account Number: 015-9892-97611.00 Report: Resolution: Ordinance: Amount Budgeted: $2,700,000 Exhibits: Memorandum of Understanding SUMMARY & RECOMMENDATION As you know, at the request of the Board, the City Manager has been negotiating with Developer, Garson Silvers, on the Town Plaza Project area at Five Points. Part of the negotiations includes the purchase of property and specifically the "Triangle Property" at the intersections of East and West Main, San Jacinto and Broadway which is key to the development of the plaza. The asking price of the property is $150,000 and the appraisal commissioned by the Board indicated an appraised value of $52,500. A Phase I and II environmental study was completed and paid for by the Developer and is on file at city hall. The report indicates that the tanks appear to be filled with water and that approximately 10,000 gallons would need to be pumped out and properly disposed of before the tank removal. While there is still work to be completed on a final Development Agreement, the Developer has agreed conditionally to allow the Board to purchase the "Triangle Property". His condition is that the attached Memorandum of Understanding on the basic points of the overall final Development Agreement must be agreed to by the Board at the meeting of the 1 oth. The City Manager would like to discuss the proposed MOU with the Board in Executive Session and then ask the Board to consider acting upon the MOU in open session thereafter if the basic terms are acceptable to the Board. The MOU includes a purchase price of $150,000 plus the LPDC accepting all costs for removal and liability associated with the underground storage tanks located on the property. The funds for the Project, including this proposed property purchase, have been included and approved in the FY 2009 Budget. If the Board approves the attached Memorandum of Understanding then staff will proceed to the next steps which include street closure procedures and other matters necessary to finalize the purchase. Action Required by the Board: Approve the attached Memorandum of Understanding between the LPDC and East A Developments, LP and La Porte 5 Points Properties, L.P. for the basic terms to be included in a final Development Agreement for the Town Plaza Project. Authorize the City Manager to complete the property purchase for the vacant .3297 acre tract at San Jacinto and South Broadway Streets in the City of La Porte, more commonly known as the "Triangle Property" in order to proceed with the development of the Town Plaza. iNM Date Memorandum of Understanding This Memorandum of Understanding (this "MOU") made by and entered into this)6t.L- day of September, 2008 (the "Effective Date") between the La Porte Development Corporation, a non-profit corporation organized under the laws of the State of Texas hereinafter (the "Board"), East A Developments, LP, a Texas limited partnership ("East A"), and La Porte 5 Points Properties, L.P., a Texas limited partnership ("LP5PP'). East A and LP5PP are collectively referred to as the "Developer", whether one or many. The terms acceptable to both Parties to begin the First Phase of the Town Plaza Project are as follows: In consideration for title to the property described as 0.3297 acres of vacant land commonly known as the "Triangle Property" the Board agrees to pay the Developer the sum of $150,000. The Board further agrees that the property is sold "as-is" and will be responsible for the removal of the underground storage tanks at the Boards expense. Typical fees and costs associated with the real estate transactions will be paid by each party accordingly. The Board also agrees to take the Developer assignment of the property located at 0 Virginia Street with the understanding that the approximate costs for the property at closing will be $55,000. Typical fees and costs associated with the real estate transactions will be paid by each party accordingly. Both Parties acknowledge that a parking covenant between the Board and the Developer will be included in a future Development Agreement with Conditions, Covenants and Restrictions (CCR's) for the property located at 0 Virginia Street. Those conditions will be with the understanding that the Developer shall have the option to build a parking garage upon the property in conjunction with his proposed office complex. Further that the Board shall negotiate in good faith as to their respective pro- rata share of costs for the garage, if any. However, both parties also acknowledge that the adjacent office complex will require the majority of the parking and therefore, the Board participation will be substantially less than the Developer participation. The Board agrees to lease the building at 117 San Jacinto at a rate of $1.00/sq. ft, not to exceed $5,200/mo/nnn for a period of 36 months with subsequent renewal options. The parties also agree that the lease can be sublet to a tenant of the Boards choosing. A final lease agreement must receive all necessary approvals and be executed by all parties before the closing of the Triangle Property. The parties further agree that the Developer will be responsible for final finish out of the building in a manner agreeable to both parties before the first monthly rental payment is due. The Board also agrees to loan to Developer the sum of $150,000.00. The term of the loan will be 6 months and interest on that sum will accrue at 5% per year, compounding monthly. Developer will use that sum to purchase 109 and 111 San Jacinto from Wade 1 Cooper, which will be closed simultaneously with the sale of the Triangle Property. 109 and 111 San Jacinto will be security for the loan. The Developer has agreed to gift 1 % of the Development fees associated the development of the office complex to a special fund in support of the City "Art in Public Places Program" currently being developed up to a maximum of $150,000. The Texas Parks and Wildlife Commission has agreed to sell to the LPDC the property located at 115 San Jacinto Street, which currently houses the Texas Parks and Wildlife Region 4 Administration Staff. The agreed to price is $450,000 and a letter of intent directing staff to proceed with the paperwork will be sent to TPW on September 11, 2008. In the Development Agreement to be drafted the Developer will agree to purchase the property from the LPDC Board for $450,000. A timeline for performance as to the construction of office complex shall be included as a condition of the sale of the property to the Developer and also included in the final Development Agreement. This constitutes the initial, non-binding understanding between the parties in order to begin the process of land purchases and lay the groundwork for the final Development Agreement in order for the creation of the Town Plaza to proceed while assuring both parties that all elements in this Memorandum of Understanding. f aL~nt La Porte Development Corporation VJr/ M1& I/{m Attest: Martha iIIett, City Secretary EAST A DEVELOPMENTS, L.P. By: GSDB Management, L.L.C., it's General Partner ../47 -~d.a ~ Garson Silvers Manager ~ / r"~.",../"" "".... By: LA PORTE 5 POINTS PROPERTIES, L.P. By: GSBS La Porte Management, L. L ., it's General Partner By: Garson Silvers Manager 2 8 PURCHASE AND SALE AGREEMENT THIS PURCHASE AND SALE AGREEMENT (this "Agreement") is entered into by and between LA PORTE 5 POINTS PROPERTIES, L.P., a Texas limited partnership ("Seller"), and LA PORTE ECONOMIC DEVELOPMENT CORPORATION, a Texas non-profit corporation ("Purchaser"), as of the Effective Date (as hereinafter defined). 1 Agreement. For and in consideration of the mutual benefits enjoyed by each of the parties to this Agreement, Seller agrees to sell and convey to Purchaser, and Purchaser agrees to purchase and accept conveyance of, the Property (as hereinafter defined) pursuant to the terms and conditions herein set forth. 2 The Property. The property which is the subject of this Agreement is the fee simple title in and to that certain real property, as more particularly described on Exhibit "A" attached hereto, together with all improvements, fixtures, equipment, and other personal property owned by Seller thereon, and located on or about or used in connection with said real property, if any, and all of Seller's right, title, and interest, if any, in and to all easements, tenements, hereditaments, privileges, and appurtenances in any way belonging or relating to the foregoing, including, without limitation, (i) any land to the midpoint of the bed of any highway, street, road, or avenue, open or proposed, in front of, abutting, or adjoining such land, (ii) any land lying in or under the bed of any creek, stream, bayou, or river running through, abutting, or adjacent to such land, (iii) any riparian, appropriative, or other water rights of Seller appurtenant to such land and relating to surface or subsurface waters, (iv) any oil, gas, or other minerals or mineral rights relating to such land or to the surface or subsurface thereof (v) any strips, gores, or pieces of property abutting, bounding or which are adjacent or contiguous to such land, and (vi) all easements, right-of-ways, rights of ingress, or egress and reversionary interests benefitting such land (collectively, the "Property"). 3 Purchase Price. Seller agrees to accept and Purchaser agrees to pay as consideration for the sale of the Property (the "Purchase Price"), subject to the terms of this Agreement, an amount equal to ONE HUNDRED FIFTY THOUSAND DOLLARS AND NO CENTS ($150,000.00). 4 Seller's Title. Ten (10) days following the Effective Date, Seller, at its sole cost and expense, shall furnish to Purchaser a Commitment for Title Insurance covering the Property prepared by Stewart Title Company (the "Commitment"), addressed to Purchaser, pursuant to which the Title Company shall commit to issue to Purchaser a Texas Owner's Policy of Title Insurance ("Title Policy"). 5 Survey. Purchaser acknow ledges that Seller has provided its most recent survey of the Property. Any further surveys will be done at Seller's sole cost and expense. 6 Documents Relating to the Property. Fifteen (15) days following the Effective Date, Seller, at its sole cost and expense, shall deliver to Purchaser true and correct copies of the following documents and materials (collectively, the "Due Diligence Materials"): 6.1 any existing environmental reports concerning the Property in Seller's possession or under its direction and control; 6.2 copies of all tenant leases concerning the Property; 6.3 copies of all service contracts related to the Property; 6.4 copies of all insurance policies concerning or related to the Property; and 6.5 copies of all building plans and specifications related to the property. 7 On-Site Inspections. Until the Closing Date or earlier termination of this Agreement, Purchaser may, at Purchaser's expense, conduct all on-site inspections of the Property determined by Purchaser to be necessary or appropriate to determine whether the Property is suitable for Purchaser's intended use, including, without limitation, the testing and inspection of the Property (and its subsurface) for any environmental contamination and for its suitability for development, the taking of ground water and core samples, soil tests, topographical and fault studies, and all other surveys, studies, tests and analysis desired by Purchaser. Seller hereby grants to Purchaser and its designated agents or contractors the right to enter upon the Property to perform such inspections, tests, and other studies; provided, however, that (i) Purchaser shall repair any material physical damage or alteration to the Property resulting therefrom and (ii) PURCHASER SHALL INDEMNIFY, DEFEND, AND HOLD SELLER HARMLESS FROM AND AGAINST ANY DAMAGE, CLAIM, CAUSE OF ACTION, LIABILITY, COST (INCLUDING, WITHOUT LIMITATION, REASONABLE ATTORNEYS' FEES, AND COURT COSTS) OR OTHER OBLIGATION (collectively, "Entry Claims") CAUSED BY PURCHASER'S ENTRY UPON, INSPECTION OF, ALTERATION OF, TESTING OF, AND/OR DAMAGE OF THE PROPERTY, INCLUDING ANY SUCH ENTRY CLAIMS ARISING FROM THE NEGLIGENCE OF PURCHASER, PURCHASER'S AG ENTS, CONTRACTORS, EMPLOYEES, OR ANY OTHER PERSON WHO IS CAUSED BY PURCHASER TO HAVE ANY CONTACT WHATSOEVER WITH THE PROPERTY, OR SUCH ENTRY CLAIMS ARISING IN STRICT LIABILITY BY ANY SUCH PERSONS. The obligation of Purchaser to indemnify Seller under this Section shall survive the Closing or the earlier termination of this Agreement. 8 Permitted Encumbrances. "Permitted Encumbrances" means (i) taxes and assessments for the year 2008 and later, and any taxes and assessments which may arise from the change in land ownership or usage; (ii) any matters which a surveyor physical inspection would disclose; (iii) the ordinances, zoning, restrictions, and similar regulations imposed by the City of La Porte or any other federal, state, or municipal authority of competent jurisdiction; and (iv) all matters of record in the office of the County Clerk of Harris County, Texas, to the extent the same are valid, subsisting, and affect the property in question. 9 Warranties and Representations of Seller. Seller makes the following representations and warranties, all of which are true and correct as of the Effective Date, which shall be true and correct on the Closing Date (as hereinafter defined). 9.1 to the best of Seller's knowledge and belief, Seller has good, indefeasible, and insurable fee simple title in and to the Property, free and clear of all liens other than the Permitted Encum brances; 9.2 to the best of Seller's knowledge and belief, Seller has not granted to any person, firm, or entity, other than Purchaser, any right to purchase the Property or any portion thereof which remains outstanding as of the Effective Date or which shall remain outstanding as of the date the same is conveyed to Purchaser, and there are no parties in possession of any portion of the Property; 9.3 to the best of Seller's knowledge and belief, there are no property agreements, warranties, permits, or other agreements relating to the ownership, operation or use of the Property other than those disclosed to Purchaser by Seller; 9.4 to the best of Seller's knowledge and belief, Seller has received no notice (and has no other knowledge) of any pending or threatened condemnation, special assessments, or similar proceedings affecting the Property; 9.5 Seller has full power and authority to enter into this Agreement and to assume and perform all of its obligations hereunder, and the execution and delivery of this Agreement and the performance by Seller of its obligations hereunder requires no further action or approval in order to constitute this Agreement as a binding and enforceable obligation of Seller; and 9.6 Seller is not a "foreign person" as defined in Section 1445 of the Internal Revenue Code. 10 Warranties and Representations of Purchaser. Purchaser makes the following representations and warranties, all of which are true and correct as of the Effective Date, and which shall be true and correct on the Closing Date (as hereinafter defined). 10.1 Purchaser represents and warrants to Seller that Purchaser has been duly authorized to enter into this Agreement on the terms and conditions of this Agreement, that this Agreement is fully binding and enforceable against Purchaser, and the person executing this Agreement on behalf of Purchaser has the authority to do so; 10.2 Purchaser is duly organized and legally existing under the laws of the State of Texas, or can legally conduct business in the State of Texas; and 10.3 Purchaser is represented by counsel of its own selection and is not in a significantly disparate bargaining position with Seller. 11 Additional Covenants of Seller. Until the Closing, Seller covenants and agrees as follows: 11.1 Seller shall not commit any waste of the Property and shall keep the Property in substantially the same condition as its current condition, ordinary wear and tear excepted; and 11.2 Seller will promptly advise Purchaser in writing of any material changes, additions, deletions, or modifications in or to any of the Due Diligence Materials to be delivered to Purchaser, and shall provide Purchaser with true, correct and complete copies of such changes, additions, deletions or modifications. 12 Condemnation. 12.1 In the event any proceeding should be commenced for the taking in condemnation or under the power of eminent domain of all or any portion of the Property (a "Condemnation Proceeding"), Seller shall promptly give to Purchaser written notice of, and full information concerning, such Condemnation Proceeding and shall thereafter keep Purchaser fully informed concerning such Condemnation Proceeding. If a Condemnation Proceeding occurs prior to the Closing, Purchaser shall have the right to terminate this Agreement. Upon any termination of this Agreement, both parties shall be released from their obligations hereunder, except as to those obligations that are expressly to survive the termination of this Agreement. 12.2 If Purchaser does not elect to terminate this Agreement as a result of a Condemnation Proceeding, and the Property is purchased by Purchaser while such Condemnation Proceeding is pending, then Purchaser shall be substituted for Seller as a defendant in such proceeding. In the event such Condemnation Proceeding is concluded while Seller is still the owner of the Property and Seller receives the condemnation award, then the Purchase Price for the Property shall be reduced by the amount of the condemnation award which is attributable thereto. If Seller has not received the condemnation award at the time of Closing, then the Purchase Price shall remain unchanged, and Seller shall assign to Purchaser all of the right, title and interest of Seller in such condemnation award. Seller agrees that Purchaser shall have the right, at Purchaser's expense, to participate in any Condemnation Proceeding. 13 Closing. 13.1 As used in this Agreement, the term "Cooper Property" means land in Harris County, Texas, consisting of all of Lots 6-8 and the North 18 feet of Lot 9, Block 198, Town of La Porte, as recorded in the Map Records of Harris County, Texas Volume 8, Page 16. As used in this Agreement, the term "Retail Property" means land in Harris County, Texas, consisting of the South seven (7) feet of Lot 9, all of Lot 10, the West fifty-six and four tenths (56.4) feet of Lots 11, 12 and 13 of Block 198 of the TOWN OF LA PORTE, as recorded in the Map Records of Harris County, Texas Volume 8, Page 16. 13.2 The consummation of the purchase and sale of the Property (the "Closing") shall take place at Stewart Title Company, 1900 North Loop West, Suite 600, Houston, Texas 77018 (the "Title Company"), at mutually agreed upon time on or before September 23, 2008 (the "Closing Date"). 13.3 At the Closing, Seller, at its sole cost and expense, shall deliver to Purchaser (or to the Title Company in escrow for delivery to Purchaser upon consummation of the purchase and sale provided for herein) the following closing documents (collectively, the "Closing Documents"): 13.3.1 A Special Warranty Deed for the Property (the "Deed") executed by Seller, duly acknowledged and in form for recording, substantially in the form attached hereto as Exhibit "C", which Deed shall convey to Purchaser, subject to the Permitted Exceptions and "AS IS" condition, good, indefeasible and insurable fee simple title to the Property, free and clear of all liens, encum brances, covenants, conditions, restrictions, right-of-ways, easements and other matters affecting title, except the Permitted Encumbrances; 13.3.2 the Title Insurance Policy; 13.3.3 Seller's affidavit in a form reasonably acceptable to Purchaser and Seller, as required by Section 1445 of the Internal Revenue Code; 13.3.4 possession of the Property to Purchaser in accordance with the terms of this Agreement; 13.3.5 consents in the form attached hereto as Exhibit "B" for the Cooper Property and Retail Property executed by East A; 13.3.6 evidence, in form and content satisfactory to Purchaser and the Title Company, that the persons executing the instruments delivered at Closing on behalf of Seller have the authority to bind Seller to perform its obligations set forth therein; and 13.3.7 Such other documents and items as are contemplated to be delivered by Seller to Purchaser at the Closing pursuant to the other provisions of this Agreement. 13.4 At Closing, Purchaser shall execute all documents to be executed by Purchaser and deliver to Seller (or to the Title Company in escrow for delivery to Seller) the remaining portion of the Purchase Price (less any credits to which Purchaser is entitled pursuant to the terms hereof). The failure of Purchaser to fully fulfill all of its obligations under this Section shall be an Event of Default. 13.5 After the Closing, neither party hereto shall have any further rights, duties or obligations to the other pursuant to this Agreement other than those arising pursuant to the provisions hereof that are expressly to survive the Closing and those arising pursuant to the documents executed and delivered at the Closing. 13.6 The obligation of either party is contingent upon the execution of a lease by Purchaser, as tenant, and East A, as landlord, of the Retail Property at a rental rate of $1.00 per square foot per month, for a term of three (3) years, and under any other terms as East A and the Purchaser may agree. 13.7 Simultaneous with Closing, Purchaser shall loan to East A Developments, L.P. ("East A") the sum of $150,000.00 for the purchase of the Cooper Property under the terms of the promissory note attached hereto as Exhibit "D" ("Promissory Note"). Such loan shall be secured by a lien against Cooper Property and Retail Property; such lien being evidenced by the deed of trust attached hereto as Exhibit "E" (the "Deed of Trust"). East A shall, at Closing, (i) close on the purchase of the Cooper Property from Wade Cooper (at such time all liens must be released from the Cooper Property) in accordance with the terms of that certain Commercial Contract -- Improved Property by and between East A and Wade Cooper, (ii) execute the Promissory Note and Deed of Trust, (iii) execute the consent attached hereto as Exhibit "B", (iv) execute a Special Warranty Deed in the form attached hereto as Exhibit "F", and (v) obtain a Mortgagee's Title Insurance Policy for Seller for the Cooper Property and Retail Property(which may be paid by the seller ofthe Cooper Property). East A's obligations under this Agreement are contingent upon Purchaser's performance of all obligations under this Agreement (including those to Seller). East A shall be subrogated to all rights of Seller under this Agreement, including any remedies, claims, offsets, and defenses, and without limiting the generality of the foregoing, may offset any sums EastA owes under the Promissory Note with any sums Purchaser owes East A and/or Seller under this Agreement. 14 Closing- Costs. 14.1 Seller agrees to pay for the cost of the Owner's title policy premium, all charges for tax certificates, all charges for the preparation and recordation of any releases or instruments required to clear Seller's title for conveyance in accordance with the provisions of this Agreement, and one-half (1/2) of any escrow fee charged by the Title Company. 14.2 Purchaser agrees to pay all charges for the recordation of the instruments conveying title to the Property, one-half (1/2) of any escrow fee charged by the Title Company, the costs of any recording fees which Seller is not obligated to pay above, the cost of any rollback taxes or similar fee resulting from the transfer of the Property or changed use of the Property; and all other fees payable by Purchaser under this Agreement. 14.3 All other costs, charges and expenses in connection with each closing shall be allocated between Purchaser and Seller as specified in this Agreement, or absent such specification, in accordance with the customary practices in Houston, Harris County, Texas. 15 Property Taxes. All property taxes assessed against the Property for the year 2008 and beyond are the responsibility of Purchaser. 16 Remedies. 16.1 Purchaser will be in default if any of the following occurs ("Event of Purchaser Default"): 16.1.1 Purchaser fails to perform any covenant in this Agreement; 16.1.2 any representation or warranty of Purchaser is untrue or becomes untrue; or 16.1.3 Purchaser (1) becomes insolvent; (2) makes a transfer in fraud of creditors; (3) makes an assignment for the benefit of creditors; (4) filesapetition under any section or chapter of the Federal Bankruptcy Code, as amended, or under any similar law or statute of the United States or any State thereof; (5) is adjudged bankrupt or insolvent; or (6) becomes subject to an appointed receiver or trustee. 16.2 Upon the occurrence of an Event of Purchaser Default, Seller shall notify Purchaser of such default in accordance with the notice provisions of this Agreement, and Purchaser shall cure such Event of Purchaser Default within ten (10) days of the same. Upon the expiration of such ten (10) days, Seller may exercise anyone or more of the following remedies to the extent they are not inconsistent: 16.2.1 terminate this Agreement and neither party will be further obligated hereby; 16.2.2 seek specific performance of any obligations of Purchaser hereunder; or 16.2.3 seek any relief provided at law or in equity. 16.3 Seller will be in default if any of the following occurs ("Event of Seller Default"): 16.3.1 Seller fails to perform any covenant in this Agreement; 16.3.2 any representation or warranty of Seller is untrue or becomes untrue; or 16.3.3 Seller (1) becomes insolvent; (2) makes a transfer in fraud of creditors; (3) makes an assignment for the benefit of creditors; (4) files a petition under any section or chapter of the Federal Bankruptcy Code, as amended, or under any similar law or statute of the United States or any State thereof; (5) is adjudged bankrupt or insolvent; or (6) becomes subject to an appointed receiver or trustee. 16.4 Upon the occurrence of an Event of Seller Default, Purchaser shall notify Seller of such default in accordance with the notice provisions of this Agreement, and Seller shall cure such Event of Seller Default within ten (10) days of the same. Upon the expiration of such ten (10) days, Purchaser may exercise anyone or more of the following remedies to the extent they are not inconsistent: 16.4.1 terminate this Agreement and neither party will be further obligated hereby; 16.4.2 seek specific performance of any obligations of Seller hereunder; or 16.4.3 seek any relief provided at law or in equity. 17 Real Estate Commissions. Each party hereto represents to the other that it has not authorized any broker or finder to act on its behalfin connection with the sale and purchase hereunder and that such party has not dealt with any broker or finder purporting to act on behalf of any other party. Each party hereto agrees to indemnify and hold harmless the other party from and against any and all, losses, liens, claims, judgments, liabilities, costs, expenses or damages (including reasonable attorneys' fees and court costs) of any kind or character arising out of or resulting from any agreement, arrangement or understanding alleged to have been made by such party or on its behalf with any broker or finder in connection with this Agreement or the transaction contemplated hereby. This paragraph shall survive the Closing or any termination of this Agreement. 18 Notices. All notices, requests or permissions required or permitted to be given to either Purchaser or Seller under the terms of this Agreement shall be sufficient if they are in writing and mailed registered or certified mail, return receipt requested, or delivered in person, as follows: To Purchaser: La Porte Economic Development Corporation City of La Porte, Texas 604 W. Fairmont Parkway La Porte, Texas 77571 Attention: Ron Bottoms, City Manager with copy to: Askins and Askins, P.C. 7D;;L'~W, Fairmont Parkway I Attention: Clark T. Askins 1-A ?o-K.-TE IT)( (('0-1 , To Seller: La Porte 5 Points Properties 1001 Usener Houston, Texas 77007 With a copy to: Benjamin P. Miller Attorney and Counselor at Law 4900 Woodway Drive, Suite 517 Houston, Texas 77056 Tel: 713-892-5400 Fax: 713-892-5401 bpmiller82@gmail.com 19 Effective Date. The "Effective Date" means the date of acknowledgment of receipt of a fully executed copy of this Agreement by the Title Company as provided below. The party offering the Agreement may withdraw the offer at any time prior to its acceptance by the party to whom this Agreement is offered. 20 Miscellaneous. 20.1 This Agreement shall be construed and interpreted in accordance with the laws of the State of Texas. 20.2 Time is of the essence as to all matters contained in this Agreement. 20.3 If the final day of any time period or limitation set out in any provision of this Agreement falls on a Saturday, Sunday, or legal holiday recognized by the United States government or the State of Texas, then and in such event the time of such period or limitation shall be extended to the next day which is not a Saturday, Sunday or such legal holiday. 20.4 In the event of any controversy, claim or dispute between the parties arising from or relating to this Agreement (including, but not limited to, the enforcement of any indemnity provisions), the prevailing party shall be entitled to recover reasonable costs, expenses and attorneys' fees. For all purposes of this Agreement and any other documents relating to this Agreement, the terms "attorneys' fees" or "counsel fees" shall be deemed to include paralegals and legal assistants' fees, and wherever provision is made herein or therein for the payment of attorneys' or counsel fees or expenses, such provision shall include, but not be limited to, such fees and expenses (and any applicable sales taxes thereon) incurred in any and all judicial, bankruptcy, reorganization, administrative or other proceedings, including appellate proceedings, whether such fees or expenses arise before proceedings are commenced or after entry of a final judgment. 20.5 This Agreement may be executed in any number of counterparts, each of which, when executed and delivered, shall be an original, but such counterparts shall together constitute one and the same instrument. 20.6 This Agreement may not be modified or amended except by a subsequent agreement in writing signed by both Seller and Purchaser. Purchaser and Seller may waive any of the conditions herein or any of the obligations of the other party hereunder, but any such waiver shall be effective only if in writing and signed by the party waiving such condition or obligation. 20.7 This Agreement, including the exhibits, schedules, and attachments attached thereto (all of which shall be deemed incorporated into this Agreement by reference), constitutes the entire agreement and understanding between the parties hereto and supersedes all prior and contemporaneous agreements and understandings of the parties in connection therewith. No statements, agreements or understandings, representations, warranties or conditions not expressed in this Agreement shall be binding upon the parties hereto, or shall be effective to interpret, change or restrict the provisions of this Agreement unless such is in writing signed by the party against whom enforcement thereof is sought. No oral agreements exist between the parties. 20.8 If any provision of this Agreement or application to any party or circumstances shall be determined by any court of competent jurisdiction to be invalid and unenforceable to any extent, the remainder of this Agreement or the application of such provision to such person or circumstances, other than those as to which it is so determined invalid or unenforceable, shall not be affected thereby, and each provision hereof shall be valid and shall be enforced to the fullest extent permitted by law. 20.9 The captions in this Agreement are inserted only as a matter of convenience and for reference and in no way define, limit or describe the scope of this Agreement or the scope or content of any of its provisions. 20.10 All exhibits described herein and attached hereto are fully incorporated into this Agreement by this reference for all purposes. 20.11 Except as expressly set forth herein or called for herein or called for in any of the instruments attached as exhibits hereto, SELLER MAKES NO OTHER WARRANTIES OR REPRESENTATIONS of any kind or character, express or implied, with respect to the Property, its physical condition, income to be derived therefrom or expenses to be incurred with respect thereto, or with respect to information or documents previously furnished to Purchaser or furnished to Purchaser pursuant to this Agreement, or with respect to Seller's obligations or any other matter or thing relating to or affecting the same, and there are no oral agreements, warranties or representations collateral to or affecting the Property except as may otherwise be expressly set forth herein. Notwithstanding anything contained herein to the contrary, this Section shall survive the Closing or any termination of this Agreement. PURCHASER ACKNOWLEDGES THAT THE CONVEYANCE OF THE PROPERTY IS SPECIFICALLY MADE "AS-IS" AND "WHERE-IS" WITH ALL FAULTS, WITHOUT ANY REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED (EXCEPT AS TO TITLE AS LIMITED IN THIS AGREEMENT), INCLUDING, WITHOUT LIMITATION, IMPLIED WARRANTIES OF FITNESS FOR ANY PARTICULAR PURPOSE, HABITABILITY, SUITABILITY, TENABILITY, OR MERCHANTABILITY OR ANY OTHER WARRANTIES WHATSOEVER CONTAINED IN OR CREATED BY THE TEXAS BUSINESS AND COMMERCE CODE, UNDER THE LAWS OF THE STATE OF TEXAS, OR OTHERWISE. PURCHASER ACKNOWLEDGES THAT, EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, NEITHER SELLER NOR ANY OF ITS AGENTS HAVE MADE, AND SPECIFICALLY NEGATE AND DISCLAIM, ANY REPRESENTATIONS, WARRANTIES, PROMISES, COVENANTS, AGREEMENTS OR GUARANTIES OF ANY KIND OR CHARACTER WHATSOEVER, WHETHER EXPRESS OR IMPLIED, ORAL OR WRITTEN, OF, AS TO, CONCERNING, OR WITH RESPECT TO, (i) THE VALUE, NATURE, QUALITY OR CONDITION OF THE PROPERTY, INCLUDING, WITHOUT LIMITATION, THE WATER, SOIL AND GEOLOGY, (ii) THE SUITABILITY OF THE PROPERTY FOR ANY AND ALL ACTIVITIES AND USES WHICH MAY BE CONDUCTED THEREON, (iii) THE HABITABILITY, MERCHANTABILITY, MARKETABILITY, PROFITABILITY OR FITNESS FOR A PARTICULAR PURPOSE OF THE PROPER TY, OR (iv) ANY OTHER MATTER WITH RESPECT TO THE PROPERTY. PURCHASER SHALL RELY SOLELY ON ITS OWN INVESTIGATION OF THE PROPERTY AND NOT ON ANY INFORMATION PROVIDED OR TO BE PROVID ED BY SELLER OR ITS AG ENTS OR CONTRACTORSEXCEPTASCONTAINEDINTHISAGREEMENT.SELLERSHALL NOT BE LIABLE OR BOUND IN ANY MANNER BY ANY VERBAL OR WRITTEN STATEMENTS, REPRESENTATIONS OR INFORMATION PERTAINING TO THE PROPERTY OR THE OPERATION THEREOF, FURNISHED BY ANY PARTY PURPORTING TO ACT ON BEHALF OF SELLER, EXCEPT AS CONTAINED IN THIS AGREEMENT. 20.12 Purchaser acknowledges that the Property may contain one or more underground storage tanks thereon. Purchaser shall assume all liability for such tanks, all responsibility for the removal of such tanks, and all costs associated therewith. 20.13 Purchaser shall not have the right to assign its interest in this Agreement without obtaining the prior written consent of Seller. Purchaser hereby agrees that any assignment by Purchaser in contravention of this provision shall be void and shall not relieve Purchaser of its obligations and liabilities hereunder. 20.14 This Agreement shall be binding upon and shall inure to the benefit of the parties hereto, their heirs, successors and assigns. Whenever in this Agreement a reference is made to any of the parties hereto, such reference shall be deemed to include a reference to the heirs, legal representatives, successors and assigns of such parties. 20.15 Purchaser is hereby notified as to the following: Seller makes no representations or warranties as to the existence of or applicability of any homeowners' associations. However, restrictive covenants governing the use and occupancy of the property and a dedicatory instrument governing the establishment, maintenance, and operation ofthis residential community may have been or will be recorded in the Real Property Records of the county in which the property is located. Copies of the restrictive covenants and dedicatory instrument may be obtained from the county clerk. Seller makes no representation as to whether membership may be required presently or in the future in any such homeowners' association. Seller makes no warranties or representation as to the applicability, enforceability, and/or existence of any restrictive covenants, and Purchaser acknowledges that Purchaser has not relied on any representations, warranties, and/or materials made, provided, or delivered by seller. Purchaser acknowledges that it has used its own due diligence to research and investigate any homeowners' associations and/or Restrictive Covenants, their applicability, enforceability, existence, and affect on the feasibility of any use Purchaser is contemplating. 20.16 Additional Notices. 20.16.1 Purchaser should have an abstract covering the Property examined by an attorney of Purchaser's selection, or Purchaser should obtain a title policy. 20.16.2 If the Property is situated in a utility or other statutorily created district providing water, sewer, drainage, or flood control facilities and services, Chapter 49, Texas Water Code, requires Seller to deliver and Purchaser to sign the statutory notice relating to the tax rate, bonded indebtedness, or standby fees of the district before final execution of this contract. 20.16.3 Notice required by Section 13.257 of the Texas Water Code: "The real property, described in Exhibit "A", that you are about to purchase may be located in a certificated water or sewer service area, which is authorized by law to provide water or sewer service to the properties in the certificated area. If your property is located in a certificated area, there may be special costs or charges that you will be required to pay before you can receive water or sewer service. There may be a period required to construct lines or other facilities necessary to provide water or sewer service to you property. You are advised to determine if the property is in a certificated area and contact the utility service provider to determine the cost that you will be required to pay and the period, if any, that is required to provide water or sewer service to your property. The undersigned purchaser hereby acknow ledges receipt of the foregoing notice at or before the execution of a binding contract for the purchase of the real property described in the notice or at closing of purchase of the real property." The real property is described in Exhibit "A" of this Agreement. 20.16.4 If the Property is located outside the limits of a municipality, the Property may now or later be included in the extraterritorial jurisdiction ("ETJ") of a municipality and may now or later be subject to annexation by the municipality. Each municipality maintains a map that depicts its boundaries and ETJ. To determine if the Property is located within a municipality's ETJ, Purchaser should contact all municipalities located in the general proximity of the Property for further information. 20.16.5 Brokers are not qualified to perform property inspections, surveys, engineering studies, environmental assessments, or inspections to determine compliance with zoning, governmental regulations, or laws. Purchaser should seek experts to perform such services. Selection of inspectors and repairmen is the responsibility of Purchaser. IN WITNESS WHEREOF, this Agreement has been executed by the parties hereto as of the date set forth below, but shall be effective as of the Effective Date. SELLER: LA PORTE 5 POINTS PROPERTIES, L.P. By: Garson Silvers Manager Date: -L/J-/7P-4- By: GSBS La Porte Management, L.L.C., its General Partner PURCHASER: Date: _ Cf/JQ:D't_ ATTEST: ~{)jJjA<~1 Secretary of the Corporation EAST A: EAST A DEVELOPMENTS, L.P. By: GSDB Management, L.L.C., its General Partner Date: :z;~ The undersigned, as escrow agent, hereby acknowledges receipt of a fully executed original of this Agreement. Received this ____ day of September, 2008 STEWART TITLE COMPANY By: Name: Title: EXHIBIT "A" Legal Description of the Property; TRACT 1: Lots 1 through 9 of Block 199 of the TOWN OF LA PORTE, as recorded in the Map Records of Harris County, Texas Volume 8, Page 16 TRACT 2: All of Seller's right, title and interest in and to the abutting 100' wide public right -of-way known as San Jacinto Street Exhibit "B" September _, 2008 Planning Department City of La Porte City Hall 604 West Fairmont Parkway La Porte, TX 77571 Re: Application to Close that Portion of San Jacinto Street, Based on 100' Right-of- Way, Lying and Being Situated Between Blocks 198 and 199, in the Town of La Porte, Harris County, Texas. Gentlemen: The undersigned, as owners and lienholders of properties in Blocks 198 and 199, Town of La Porte, Harris County, Texas, abutting the above described portion of the San Jacinto Street right-of-way, do hereby make application to the City of La Porte, under the provisions of Section 62-31, et seq, of the Code of Ordinances of the City of La Porte, to vacate, abandon, and close said portion of the right-of-way of San Jacinto Street within the corporate limits of the City of La Porte. East A Developments, L.P., a Texas limited partnership, is the owner of the following real property: All of Lots 6, 7, 8, 9, 10, and the West fifty-six and four tenths (56.4) feet of Lots 11, 12 and 13, in Block One Hundred Ninety-Eight (198) of TOWN OF LA PORTE, an addition in Harris County, Texas, according to the map or plat thereof recorded in Volume 8, Page 16 of the Map Records of Harris County, Texas. La Porte Economic Development Corporation, a Texas non-profit corporation, is the owner of Lots 1 through 9, both inclusive, being all of Block 199, of the Town of La Porte, Harris County, Texas. La Porte Economic Development Corporation, a Texas non-profit corporation, is the first lienholder on all of Lots 6, 7, and 8, and the North 18 feet of Lot 9, Block 198, Town of La Porte, as recorded in the Map Records of Harris County, Texas Volume 8, Page 16, owned by East A Developments, L.P., a Texas limited partnership. East A Developments, L.P., has conveyed to La Porte Economic Development Corporation, all of its right, title, and interest in and to the San Jacinto Street right-of- way which abuts Lots 6 through 13, Block 198, Town of La Porte, Harris County, Texas. Gagle Investments consents to said conveyance. Gagle Investments, is the first lienholder on the South seven (7) feet of Lot 9, all of Lot 10, the West fifty-six and four tenths (56.4) feet of Lots 11, 12 and 13 of Block 198 of the TOWN OF LA PORTE, as recorded in the Map Records of Harris County, Texas Volume 8, Page 16, owned by East A Developments, L.P., a Texas limited partnership. The undersigned contemplate that the above described portion of the right-of-way of San Jacinto Street, will be incorporated, together with Block 199, Town of La Porte, Harris County, Texas, into a tract of land to be owned by the La Porte Economic Development Corporation, a Texas non-profit corporation (LPEDC), which tract ofland will be developed by LPEDC as a public park in the City of La Porte. All application fees shall be the responsibility of LPEDC. The undersigned waive any personal claims for damages against the City of La Porte, and further agree to save and hold harmless the City of La Porte from any other claims that may arise against the City of La Porte in vacating, abandoning and closing the above described portion ofthe right-of-way of San Jacinto Street, under Section 62-31, et seq, of the Code of Ordinances of the City of La Porte. Yours very truly, OWNERS: LA PORTE ECONOMIC DEVELOPMENT CORP)TION By: ~ Printed ame: ~ th(.,{sfr))-J President EAST A DEVELOPMENTS, L.P. By: GSDB Manage..m...ent, L .L'C~.' .. its General Partner .. j By: /k ' .. Garson Silvers . I Manager LIENHOLDERS: LA PORTE ECONOMIC DEVELOPMENT CORPr;~ By: j Printe Name: m u.6tOV President GAGLEINVESTMENTS By: Printed Name: President Exhibit "C" NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY REMOVE OR STRIKE ANY OR ALL OF THE FOLLOWING INFORMATION FROM ANY INSTRUMENT THAT TRANSFERS AND INTEREST IN REAL PROPERTY BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER. ~p.ecial marrantl1 l.e.eb COUNTY OF HARRIS 9 9 9 Know All Men By These Presents: THE STATE OF TEXAS That LA PORTE 5 POINTS PROPERTIES, L.P., a Texas limited partnership, ("Grantors", whether one or more), for and in consideration of the sum ofTen Dollars ($10.00) and other good and valuable consideration to Grantors this day paid by LA PORTE ECONOMIC DEVELOPMENT CORPORATION, a Texas non-profit corporation ("Grantees", whether one or more), of Harris County, Texas, the receipt and sufficiency of which is hereby acknowledged, have GRANTED, BARGAINED, SOLD and CONVEYED and by these presents do GRANT, BARGAIN, SELL and CONVEY unto Grantees all of the real and personal property situated in Harris County, Texas, described more particularly in Exhibit "A", attached hereto and incorporated by reference. This conveyance is executed by Grantors and accepted by Grantees subject to (i) taxes and assessments for the year 2008 and later, and any taxes and assessments which may arise from the change in land ownership or usage; (ii) any matters which a surveyor physical inspection would disclose; (iii) the ordinances, zoning, restrictions, and similar regulations imposed by the City of La Porte or any other federal, state, or municipal authority of competent jurisdiction; and (iv) all matters of record in the office of the County Clerk of Harris County, Texas, to the extent the same are valid, subsisting, and affect the property in question. (collectively, the "Permitted Exceptions"). THE IMPROVEMENTS, IF ANY, LOCATED UPON THE SUBJECT PROPERTY ARE CONVEYED AND ACCEPTED "AS IS", 'WHERE IS", 'WITH ALL FAULTS", IN THEIR PRESENT CONDITION, OF ANY KIND, WHETHER EXPRESS OR IMPLIED, OTHER THAN THE EXPRESS WARRANTIES OF TITLE MADE HEREIN. THE WARRANTIES OF HABITABILITY, SUITABILITY, TENABILITY, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR ANY OTHER WARRANTIES WHATSOEVER CONTAINED IN OR CREATED BY THE TEXAS BUSINESS AND COMMERCE CODE, TEXAS PROPERTY CODE, UNDER THE LAWS OF THE STATE OF TEXAS, OR OTHERWISE, ARE EXPRESSLY DISCLAIMED. GRANTEE ACCEPTS ALL LIABILITY FOR ALL COSTS, LIABILITY, AND CLAIMS RELATING TO, OR RESULTING FROM, THE CONDITION OF THE SUBJECT PROPERTY, INCLUDING ANY UNDERGROUND STORAGE TANKS OR ENVIRONMENTAL HAZARDS THEREON. TO HAVE AND TO HOLD the Subject Property, together with all and singular the rights and appurtenances thereto in anywise belonging unto Grantees, their heirs, administrators, successors and assigns, forever; and Grantors do hereby bind themselves, and their heirs, administrators, successors and assigns, to WARRANT AND FOREVER DEFEND, all and singular, the Subject Property unto Grantees, and their heirs, administrators, successors and assigns, against every person whomsoever lawfully claiming or to claim the same or any part thereof, by, through or under Grantors, but not otherwise, and subject to the Permitted Exceptions and taxes for the current year and subsequent assessments for prior years due to change in land usage or ownership. EXECUTED this the J rI- day of S.ep-/ . ,2008. LA PORTE 5 POINTS PROPERTIES, L.P. By: Garson Silvers, Manager By: GSBS La Porte Management, L.L.C., its General Partner "Grantors" THE STATE OF TEXAS ~ ~ COUNTY OF HARRIS ~ This instrument was acknowledged before me on this/tsf.r- day of September 2008, by Garson Silvers, as manager of GSBS La Porte Management, L.L.C., as general partner of LA PORTE 5 POINTS PROPERTIES, L.P. ~- I j) dt.1f- Notary Public in and for The State of Texas ~~~~~ ROBIN R ELDRIDGE . (*). MY COMMISSION EXPIRES ~~...~ ,JllIy16,2010 .m... ADDRESS OF GRANTEES: AFTER RECORDING, RETURN TO: 604 W. Fairmont Parkway La Porte, Texas 77571 H:\Ben \Client Files\East A Developments LP\380 Agreement with the City of La Porte\PSA04.wpd\091008142357 SPECIAL WARRANTY DEED ExHIBIT "A" DESCRIPTION OF REAL PROPERTY TRACT 1: All of Lots 1 through 9 of Block 199 of the TOWN OF LA PORTE, as recorded in the Map Records of Harris County, Texas Volume 8, Page 16 TRACT 2: All of Seller's right, title and interest in and to the abutting 100' wide public right -of-way known as San Jacinto Street Exhibit "D" PROMISSORY NOTE This Promissory Note (this "Note") is made by East A Developments, L.P., as maker, under the terms and conditions as follows: Article I DEFINITIONS For purposes of this Note, the following defined terms shall have the meanings set forth in this Article I: 1.1 "Borrower" means East A Developments, L.P., a Texas limited partnership. 1.2 "Borrower's Mailing Address" means 1001 Usener, Houston, Harris County, Texas 77007. 1.3 "Lender' means La Porte Economic Development Corporation, a Texas non-profit corporation. 1.4 "Place for Payment" means 604 W. Fairmont Parkway, La Porte, Texas 77571. 1.5 "Principal Amount" means One Hundred Fifty Thousand Dollars and No Cents ($150,000.00). 1.6 "Annual Interest Rate" means Five Percent (5.00%) per year. 1. 7 "Maturity Date" means the first day ofthe month following six (6) months after the Effective Date. 1.8 "PSA" means that certain Purchase and Sale Agreement by and between Lender and Borrower, dated September _, 2008. The PSA is hereby incorporated by reference. 1.9 "Effective Date" means September _,2008 Article II TERMS OF PAYMENT 2.1 Borrower promises to pay to the order of Lender the Principal Amount plus interest, compounding annually, at the Annual Interest Rate, the same being due and payable in equal monthly installments of Six Hundred Twenty-Five Dollars and No Cents ($625.00), on the first day of each month, beginning the first day of the calendar month after the Effective Date, and continuing until the Maturity Date, when the entire amount of remaining principal and accrued, unpaid interest will be payable in full. 2.2 Payments will be applied first to accrued interest and the remainder to reduction of the Principal Amount. 2.3 This Note is payable at the Place for Payment. 2.4 All unpaid amounts are due by the Maturity Date, at which time they will reach maturity. Mter maturity, Borrower promises to pay any unpaid principal balance plus interest at the Annual Interest Rate. 2.5 Borrower may prepay this Note in any amount at any time before the Maturity Date without penalty or premium. 2.6 This Note is secured by a deed of trust of even date herewith from Borrower to Knox Askins, trustee, (the "Deed of Trust") which covers the following real property (such real property being the "Collateral Security"): All of Lots 6, 7,8,9, 10, and the West fifty-six and four tenths (56.4) feet of Lots 11, 12 and 13, in Block One Hundred Ninety-Eight (198) of TOWN OF LA PORTE, an addition in Harris County, Texas, according to the map or plat thereof recorded in Volume 8, Page 16 of the Map Records of Harris County, Texas. 2.7 If Lender is obligated to indemnify Borrower under the terms of the PSA or if Lender defaults on the PSA, Borrower may elect to apply the amounts owed under the PSA to the outstanding, unpaid principal and accrued, unpaid interest, and such sums will be reduced by that amount. Article III DEFAULT 3.1 An "Event of Default" exists under this Note if: 3.1.1 Borrower fails to timely payor perform any obligation or covenant in this Note; 3.1.2 any warranty, covenant, or representation in this Note is materially false when made; 3.1.3 a receiver is appointed for Borrower or the Collateral Security; 3.1.4 any Collateral Security is assigned for the benefit of creditors; 3.1.5 a bankruptcy or insolvency proceeding is commenced by Borrower and continues for at least sixty (60) days; or 3.1.6 Borrower is dissolved, begins to wind up its affairs, or is authorized to dissolve or wind up its affairs by its governing body or persons. 3.2 If an Event of Default exists under this Note or the Deed of Trust, Lender may declare the unpaid principal balance, earned interest, and any other amounts owed on the Note immediately due. 3.3 If an Event of Default exists under this Note, before exercising any of Lender's remedies under this Note or the Deed of Trust, Lender shall first give Borrower written notice of default at Borrower's Mailing Address and Borrower will have ten (10) days after such notice is received to cure the default. In the event that this Section 3.3 conflicts with any other provision in this Note, this Section 3.3 will controL Article IV MISCELLANEOUS 4.1 Interest on the debt evidenced by this Note will not exceed the maximum rate or amount of non usurious interest that may be contracted for, taken, reserved, charged, or received under law. Any interest in excess of that maximum amount will be credited on the Principal Amount or, if the Principal Amount has been paid, refunded. On any acceleration or required or permitted prepayment, any excess interest will be canceled automatically as ofthe acceleration or prepayment or, ifthe excess interest has already been paid, credited on the Principal Amount or, if the Principal Amount has been paid, refunded. This provision overrides any conflicting provisions in this Note and all other instruments concerning the debt. 4.2 Whenever a period of time in this Note is prescribed for action to be taken by Borrower, Borrower will be liable or responsible for, and there will be excluded from the computation of any corresponding deadline, any delays due to strikes, riots, acts of God, shortages of labor or materials, war, government laws, regulations or restrictions or any other causes of any kind whatsoever which are beyond the reasonable control of Borrower. 4.3 The section and paragraph headings, titles and captions used in this Note are for convenience only and do not limit or amplify the provisions hereof. 4.4 Lender and Borrower each acknowledge that he has participated in the drafting of this Note, that this Note will not be construed against either party because it was the drafter, and that any rule of construction requiring that any provision of this Note be construed against a particular party because of that party's status as the drafter of the provision will be not be applicable to this Note. 4.5 When the context requires, singular nouns and pronouns include the pluraL 4.6 This note will be construed under the laws ofthe State of Texas, without regard to choice-of-law rules of any jurisdiction. To the maximum extent permitted by law, venue for all purposes will be the Harris County, Texas. EXECUTED AND EFFECTIVE AS OF THE EFFECTIVE DATE. EAST A DEVELOPMENTS, L.P. By: GSDB Management, L.L.C., its General Partner By: ~~//C Garson Silv . M ers, anager ~ .-,"--- _.._.-_....~- Exhibit "E" NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY REMOVE OR STRIKE ANY OR ALL OF THE FOLLOWING INFORMATION FROM ANY INSTRUMENT THAT TRANSFERS AN INTEREST IN REAL PROPERTY BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER. DEED OF TRUST THE STATE OF TEXAS COUNTY OF HARRIS ~ ~ ~ Know All Men By These Presents: THAT, this Deed of Trust ("Deed of Trust") is effective as of September _, 2008 (the "Effective Date"), from EAST A DEVELOPMENTS, L.P., a Texas limited partnership (the "Grantor", whether one or more), to KNOX ASKINS, TRUSTEE (the "Trustee"), for the benefit ofthe La Porte Economic Development Corporation, a Texas non-profit corporation (the "Beneficiary"); and WHEREAS, Grantor has executed and delivered to Beneficiary that certain Note (as defined below) in conjunction with the execution ofthat certain Purchase and Sale Agreement by and between La Porte 5 Points Properties, L.P., Grantor and Beneficiary, dated September _, 2008 (the "PSA"); WHEREAS, Grantor and Beneficiary desire to secure payment ofthat Note with the Property described below; NOW, THEREFORE, in consideration of the sum of$10.00, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Grantor has GRANTED, SOLD and CONVEYED, and by these presents does GRANT, SELL and CONVEY in trust unto Trustee, and his substitutes or successors, all of the following described property (the "Property") situated in Harris County, Texas: All of Lots 6, 7, 8, 9, 10, and the West fifty-six and four tenths (56.4) feet of Lots 11,12 and 13, in Block One Hundred Ninety-Eight (198) of TOWN OF LA PORTE, an addition in Harris County, Texas, according to the map or plat thereof recorded in Volume 8, Page 16 of the Map Records of Harris County, Texas. TO HAVE AND TO HOLD the Property in trust unto Trustee, his successors in this trust and his assigns, forever, and Grantor does hereby bind Grantor, his respective heirs, legal representatives, successors and assigns, to warrant and defend the Property to Trustee, his successors and assigns, forever, against the claim or claims, of all persons whomsoever claiming or to claim the same or any part thereof, by, through or under Grantor, but not otherwise, subject to the following exceptions: (i) any and all liens, encumbrances, reservations, restrictions, covenants, easements, rights of way, mineral interests and other matters, if any, of record in the County Clerk's Office of Harris County, Texas; (ii) all zoning, ordinances, regulations, restrictions, and other limitations imposed by any municipality with jurisdiction over the Property; and (iii) all matters which a survey and a physical inspection of the Property would reveal. If Grantor performs all the covenants and pays the Note according to its terms, this Deed of Trust shall have no further effect, and Beneficiary shall promptly release it. Article I CONVEYANCE IN TRUST; PROMISSORY NOTE 1.1 Securing Payment In Trust. This conveyance is made IN TRUST to secure payment of that certain Promissory Note of even date herewith, in the principal amount of $150,000.00, executed by Grantor, as maker, and payable to the order of Beneficiary, bearing interest and being payable as therein provided (the "Note"). To the extent that this Deed of Trust conflicts with the PSA, the PSA will control. The Agreement is hereby incorporated into this Deed of Trust by reference. 1.2 Payment of Note. The Note shall be payable at the address specified in the Note until Beneficiary gives written notice to Grantor designating another place of payment. 1.3 Application of Payments. All payments received by Beneficiary, however designated, shall be applied to the principal or interest of the Note or to expenses provided for in this Deed of Trust, or any combination ofthe foregoing, as directed by Beneficiary in accordance with the provisions of the Note. Article II GRANTOR'S OBLIGATIONS 2.1 General Obligations. Grantor shall: 2.1.1 keep the property in good repair and condition; 2.1.2 pay all taxes and assessments on the property when due; and 2.1.3 preserve the lien's priority as it is established in this Deed of Trust; 2.2 Required Insurance Policy. Grantor shall maintain, in a form acceptable to Beneficiary, an insurance policy that: 2.2.1 covers all improvements for their full insurable value as determined when the policy is issued and renewed, unless Beneficiary approves a smaller amount in writing; 2.2.2 contains an 80% coinsurance clause; 2.2.3 provides fire and extended coverage, including windstorm coverage; 2.2.4 protects Beneficiary with a standard mortgage clause; and 2.2.5 provides flood insurance at any time the property is in a flood hazard area. 2.3 Insurance Policy Covenants. Grantor shall do the following things related to the above-mentioned insurance policy: 2.3.1 comply at all times with the requirements of the 80% coinsurance clause; 2.3.2 deliver the insurance policy to Beneficiary and deliver renewals to Beneficiary at least ten days before expiration; and 2.3.3 keep any buildings occupied as required by the insurance policy. 2.4 Prior Liens. If this Deed of Trust is not a first lien, Grantor shall pay all prior lien notes that Grantor is personally liable to pay and abide by all prior lien instruments. 2.5 Subsequent Liens. Grantor may obtain other liens or security interests securing the lending of money for the construction, affixation, creation, purchase, or addition of improvements of any type or nature to the Property (including, but not limited to, so called construction loans), and such other liens shall be superior to this Deed of Trust. Article III BENEFICIARY'S RIGHTS 3.1 Successor Trustees. Beneficiary may appoint in writing a substitute or successor trustee, succeeding to all rights and responsibilities of Trustee, provided that Beneficiary does so in writing, provides a copy of the same to Grantor promptly upon doing so, and records the same in the Real Property Records of Harris County, Texas. 3.2 Application ofInsurance Proceeds. Beneficiary may apply any proceeds received under the insurance policy either to reduce the Note or to repair or replace damaged or destroyed improvements covered by the policy. 3.3 Beneficiary Performance of Obligations. If Grantor fails to perform any of Grantor's obligations, Beneficiary may perform those obligations and be reimbursed by Grantor on demand for any sums so paid, including attorney's fees, plus interest on those sums from the dates of payment at the rate stated in the Note for matured, unpaid amounts. The sum to be reimbursed shall be secured by this Deed of Trust. 3.4 Grantor Default. If Grantor defaults on the Note or fails to perform any of Grantor's obligations and the default continues after Beneficiary gives Grantor notice of the default and the time within which it must be cured, as may be required by law or by written agreement, then Beneficiary may: 3.4.1 declare the unpaid principal balance and earned interest on the Note immediately due; 3.4.2 request Trustee to foreclose this lien, in which case Beneficiary or Beneficiary's agent shall give notice of the foreclosure sale as provided by the Texas Property Code as then amended; and 3.4.3 purchase the property at any foreclosure sale by offering the highest bid and then have the bid credited on the Note. Article IV TRUSTEE'S DUTIES 4.1 Foreclosure Duties. If requested by Beneficiary to foreclose this lien, Trustee shall: 4.1.1 either personally or by agent give notice of the foreclosure sale as required by the Texas Property Code as then amended; and 4.1.2 sell and convey all or part of the property to the highest bidder for cash with a general warranty binding Grantor, subject to prior liens and to other exceptions to conveyance and warranty. 4.2 Foreclosure Sale Proceeds. From the proceeds of such sale, Trustee shall pay, in this order: 4.2.1 first, expenses of foreclosure; 4.2.2 second, to Beneficiary, the full amount of principal, interest, attorney's fees, and other charges due and unpaid; 4.2.3 third, any amounts required by law to be paid before payment to Grantor; and 4.2.4 fourth, to Grantor, any balance. Article V GENERAL PROVISIONS 5.1 Surrender of Possession. If any of the property is sold under this Deed of Trust, Grantor shall immediately surrender possession to the purchaser. If Grantor fails to do so, Grantor shall become a tenant at sufferance of the purchaser, subject to an action for forcible detainer. 5.2 Recitals. Recitals in any Trustee's deed conveying the property will be presumed to be true. 5.3 Election of Remedies. Proceeding under this Deed of Trust, filing suit for foreclosure, or pursuing any other remedy will not constitute an election of remedies. 5.4 Superior Lien. Subject to the terms ofthis Deed of Trust, this lien shall remain superior to liens later created even if the time of payment of all or part of the Note is extended or part of the property is released. 5.5 Application ofPavments. If any portion ofthe Note cannot be lawfully secured by this Deed of Trust, payments shall be applied first to discharge that portion. 5.6 Condemnation. Grantor assigns to Beneficiary all sums payable to or received by Grantor from condemnation of all or part of the property, from private sale in lieu of condemnation, and from damages caused by public works or construction on or near the property. After deducting any expenses incurred, including attorney's fees, Beneficiary may release any remaining sums to Grantor or apply such sums to reduce the Note. Beneficiary shall not be liable for failure to collect or to exercise diligence in collecting any such sums. 5.7 Usury. Interest on the debt secured by this Deed of Trust shall not exceed the maximum amount of non usurious interest that may be contracted for, taken, reserved, charged, or received under law; any interest in excess of that maximum amount shall be credited on the principal of the debt or, if that has been paid, refunded. On any acceleration or required or permitted prepayment, any such excess shall be canceled automatically as of the acceleration or prepayment or, if already paid, credited on the principal of the debt or, if the principal of the debt has been paid, refunded. This provision overrides other provisions in this and all other instruments concerning the debt. 5.8 Context. When the context requires, singular nouns and pronouns include the plural. All pronouns include the male, female and neuter genders. 5.9 Assignment. This Deed of Trust shall bind, inure to the benefit of, and be exercised by successors in interest of all parties. Grantor may expressly assign its interest in the Property subject to the liens and obligations under the Note and this Deed of Trust, and the assignee shall assume the same, at which time, Beneficiary releases Grantor from any of the obligations under this Deed of Trust and the Note, and Grantor shall have no further obligations under the Note and this Deed of Trust. 5.10 Partial Release. Any part of the Property may be released by Beneficiary without affecting the lien hereof against the remainder of the Property. 5.11 Headings. The headings contained in this Deed of Trust are included for convenience of reference only and are in no way intended to describe, interpret, define or limit the scope intent or substance of this Deed of Trust or any provision hereof. 5.12 Governing Law. This Deed of Trust shall be governed by and construed and enforced in accordance with the laws ofthe State of Texas without giving effect to any conflicts-of-law rule or procedure which would refer the matter to another jurisdiction. 5.13 Notice. All notices, requests, demands and other communications required or permitted to be given hereunder shall be deemed to have been duly given if in writing and delivered personally or mailed first class, postage prepaid, registered or certified United States mail, to such address as provided below. IN WITNESS WHEREOF, the undersigned executes this Agreement as of the date of the acknowledgment set forth below, but to be effective as of the Effective Date. GRANTOR: EAST A DEVELOPMENTS, L.P. By: GSDB Management, L.L.C., itSGe::al~~~ ~/~ ./ V Garson Silvers Manager THE STATE OF TEXAS ~ ~ COUNTY OF HARRIS ~ This instrument was acknowledged before me on the _ day of September, 2008, by East A Developments, L.P., by GSDB Management, L.L.C., its General Partner, by Garson Silvers, its Manager. ,;~..7:~ ROBIN R. ELDRIDGE f!:.*.:~) MY COMMISSION EXPIRES ~...~ July 16,2010 -,,:.~...I> lat., /. j~~ NbTARY PUBLIC, ST E OF TEXAS ADDRESS OF GRANTOR: 1001 Usener Houston, Harris County, Texas 77007 ADDRESS OF BENEFICIARY: 604 W. Fairmont Parkway La Porte, Harris County Texas 77571 MAILING ADDRESS OF TRUSTEE: AFTER RECORDING, RETURN TO: Exhibit "F" NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY REMOVE OR STRIKE ANY OR ALL OF THE FOLLOWING INFORMATION FROM ANY INSTRUMENT THAT TRANSFERS AND INTEREST IN REAL PROPERTY BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER. ~ptcial marrantll mttb (Interest in Public Right-Of- Way) THE STATE OF TEXAS COUNTY OF HARRIS ~ ~ ~ Know All Men By These Presents: That EAST A DEVELOPMENTS, L.P., a Texas limited partnership, ("Grantors", whether one or more), for and in consideration of the sum ofTen Dollars ($10.00) and other good and valuable consideration to Grantors this day paid by LA PORTE ECONOMIC DEVELOPMENT CORPORATION, a Texas non-profit corporation ("Grantees", whether one or more), of Harris County, Texas, the receipt and sufficiency of which is hereby acknowledged, have GRANTED, BARGAINED, SOLD and CONVEYED and by these presents do GRANT, BARGAIN, SELL and CONVEY unto Grantees all of the real and personal property situated in Harris County, Texas, to wit: All of Seller's right, title and interest in and to the 100' wide public right-of-way known as San Jacinto Street to the extent the same abuts Lots 6, 7, 8, 9, 10, 11, 12 and 13, in Block One Hundred Ninety-Eight (198) of TOWN OF LA PORTE, an addition in Harris County, Texas, according to the map or plat thereof recorded in Volume 8, Page 16 of the Map Records of Harris County, Texas (the "Subject Property"). This conveyance is executed by Grantors and accepted by Grantees subject to (i) taxes and assessments for the year 2008 and later, and any taxes and assessments which may arise from the change in land ownership or usage; (ii) any matters which a surveyor physical inspection would disclose; (iii) the ordinances, zoning, restrictions, and similar regulations imposed by the City of La Porte or any other federal, state, or municipal authority of competent jurisdiction; and (iv) all matters of record in the office of the County Clerk of Harris County, Texas, to the extent the same are valid, subsisting, and affect the property in question. (collectively, the "Permitted Exceptions"). THE IMPROVEMENTS, IF ANY, LOCATED UPON THE SUBJECT PROPERTY ARE CONVEYED AND ACCEPTED "AS IS", 'WHERE IS", 'WITH ALL FAULTS", IN THEIR PRESENT CONDITION, OF ANY KIND, WHETHER EXPRESS OR IMPLIED, OTHER THAN THE EXPRESS WARRANTIES OF TITLE MADE HEREIN. THE WARRANTIES OF HABITABILITY, SUITABILITY, TENABILITY, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR ANY OTHER WARRANTIES WHATSOEVER CONTAINED IN OR CREATED BY THE TEXAS BUSINESS AND COMMERCE CODE, TEXAS PROPERTY CODE, UNDER THE LAWS OF THE STATE OF TEXAS, OR OTHERWISE, ARE EXPRESSLY DISCLAIMED. GRANTEE ACCEPTS ALL LIABILITY FOR ALL COSTS, LIABILITY, AND CLAIMS RELATING TO, OR RESULTING FROM, THE CONDITION OF THE SUBJECT PROPERTY, INCLUDING ANY UNDERGROUND STORAGE TANKS OR ENVIRONMENTAL HAZARDS THEREON. TO HAVE AND TO HOLD the Subject Property, together with all and singular the rights and appurtenances thereto in anywise belonging unto Grantees, their heirs, administrators, successors and assigns, forever; and Grantors do hereby bind themselves, and their heirs, administrators, successors and assigns, to WARRANT AND FOREVER DEFEND, all and singular, the Subject Property unto Grantees, and their heirs, administrators, successors and assigns, against every person whomsoever lawfully claiming or to claim the same or any part thereof, by, through or under Grantors, but not otherwise, and subject to the Permitted Exceptions and taxes for the current year and subsequent assessments for prior years due to change in land usage or ownership. Except for any interest in that 100' public right-of-way known as San Jacinto Street, nothing in this Special Warranty Deed shall be construed to convey any right, title or interest in Lots 6, 7, 8, 9, 10, 11, 12 and 13, in Block One Hundred Ninety-Eight (198) of TOWN OF LA PORTE, an addition in Harris County, Texas, according to the map or plat thereof recorded in Volume 8, Page 16 of the Map Records of Harris County, Texas. EXECUTED this the ~y of September, 2008. EAST A DEVELOPMENTS, L.P. By: GSDB Management, L.L.C., its General Partner /I /~ ...- By: --_.~~ '4-1/~ Garson . vers, Manager / l / "Grantors"/ THE STATE OF TEXAS ~ ~ COUNTY OF HARRIS ~ This instrument was acknowledged before me on this r~;lay of September, 2008, by Garson Silvers, as manager ofGSDB Management, L.L.C. as general partner of EAST A DEVELOPMENTS, L.P. N~ctni!~t- The State of Texas GAGLE INVESTMENTS, as lienholder against land in Harris County, Texas, consisting of the South seven (7) feet of Lot 9, all of Lot 10, the West fifty-six and four tenths (56.4) feet of Lots 11,12 and 13 of Block 198 of the TOWN OF LA PORTE, as recorded in the Map Records of Harris County, Texas Volume 8, Page 16, does hereby subordinate its interest in and to the Subject Property to the grant, sale, and conveyance to Grantee under this Special Warranty Deed. GAGLEINVESTMENTS By: Printed Name: President THE STATE OF TEXAS ~ ~ COUNTY OF HARRIS ~ This instrument was acknowledged before me on this _ day of September, 2008, by , as President of Gagle Investments. Notary Public in and for The State of Texas ADDRESS OF GRANTEES: AFTER RECORDING, RETURN TO: 604 W. Fairmont Parkway La Porte, Texas 77571 H:\Ben\Client Files\East A Developments LP\380 Agreement with the City of La Porte\PSA04.wpd\091008142357 9 REQUEST FOR LPEDC BOARD AGENDA ITEM Agenda Date Requested: 9/2/2008 Budl!:et Requested By: Gretchen T ,arson Source of Funds: ED Projects Budget Department: City Mlllul~lIr/:EDC Account Number: 015989297611.00 Report: Resolution: Ordinance: Amount Budgeted: $450,000 - - Exhibits: Amount Requested: SUMMARY & RECOMMENDATION The Texas Parks and Wildlife (TPW) Commission met on August 21, 2008 to consider the sale of the local TPW Administration building at 105 San Jacinto in the City of La Porte to the Development Corporation as a part of the Town Plaza Project. The Commission agreed to the sale of the property for $450,000. As a condition of the sale the Board must agree to allow the local offices to continue to operate at the current location until their new offices at Lake Sheldon are complete. The TPW staff has indicated that they have already begun work on their preliminary plans and have every intention of being relocated to the new site before the end of 2009. Additionally they have requested that the funds, when all the paperwork has been completed and approved by both parties, be placed in the TPW Foundation for ease of processing. We will be working with them to complete all the required legal documents for review and approval with the City Attorney. The funds for the property purchase have been budgeted and approved in FY 2009 and the Project Fund created. We will keep you apprised of the process as we move forward towards completion of the final sale. Action Required by the Board: Approve moving forward with the appropriate paperwork to begin the process to purchase the property located at 105 San Jacinto Street in the City of La Porte (also known as the Texas Par nd Wildlife Administration Offices) for $450,000. Authorize staff to send a letter to the T as Parks and Wildlife Department of this intent to purchase the property under the ener terms listed above. 7N~ Date 10 REQUEST FOR LPEDC BOARD AGENDA ITEM Agenda Date Requested: 9/2/2008 Budl!et Requested By: Gretchen T ,arson Source of Funds: ED Budget Department: City MllllllgerfEDC Account Number: 038603056550.07 Report: Resolution: Ordinance: Amount Budgeted: $10,000 - - Exhibits: Main Street Marketing Agreement SUMMARY & RECOMMENDATION As we continue with the plans for the Gateway Enhancements, 912 Main Street Renovations, and the Town Plaza we need to also plan for assisting the marketing and leasing of the buildings. To that end we have worked with the Economic Alliance to develop the attached "Marketing Development - Main Street Revitalization Agreement". As you review you will note that it also includes "marketing for all building which are for lease on Main Street" not just the two project ends. We believe that it makes sense to include every business from SH 146 along Main Street to the town plaza area for a more "holistic" approach to the revitalization efforts. The agreement is for an initial six month period beginning October 1 through April 30, 2009 at a cost of $9,000. Then renewal may be considered, as needed, on a month to month basis until terminated for $1,500 per month. We anticipate that the agreement will likely run between 18 and 24 months after which there may be sufficient revitalization momentum that it can expire having met the objectives established. Also as you review the agreement will see that this is very much a team effort amongst all the parties. The Economic Alliance is taking the lead with a systematic approach to coordinate the efforts of multiple people and leads, along with the design and distribution of complimentary marketing materials. There are sufficient funds in the FY 2009 Budget to cover the costs of the Agreement in professional services as part of the budgeted contingency for miscellaneous services associated with this project as well as the Town Plaza. The Economic Alliance will also be available along with staff to answer questions regarding the Agreement at the meeting. Action Required by the Board: Approve the attached Marketing Development - Main Street Revitalization Agreement betw LPDC and the Economic Alliance. :Iff Ae EconO~lIiance Houston Port Region MARKETING DEVELOPMENT AGREEMENT "MAIN STREET REVITALIZATION" THIS Agreement ("Agreement") is made and entered into by and between THE ECONOMIC ALLIANCE HOUSTON PORT REGION, a Texas non-profit corporation; 908 West Main, La Porte, Texas 77571 (hereinafter "the Economic Alliance"), and the CITY OF LA PORTE, TEXAS; 604 W. Fairmont Parkway, La Porte, Texas 77571, (hereinafter "the City"). WHEREAS, the Economic Alliance is a non-profit corporation organized to promote economic development with an emphasis on performance in the southeast portion of Harris County, and; WHEREAS, the City promotes economic development in La Porte, Harris County, Texas; and; WHEREAS, the City seeks assistance to fulfill its economic development initiatives in La Porte, Texas; and; WHEREAS, the Economic Alliance is qualified and willing to perform such assistance functions, NOW THEREFORE, in consideration of the covenants and conditions stated herein, and in consideration of the mutual benefits that will accrue to each of the parties hereof, as well as to the citizens of La Porte, Texas, the Parties have agreed and do hereby agree as follows: ARTICLE I Scope of Services Section 1.01: Services to be provided: The Economic Alliance will provide marketing development to help accelerate development of the City of La Porte's key Main Street projects and revitalization program. The specific project scope details are described in ARTICLE V included in this contract. 1 ARTICLE II Terms of Contract This agreement is for a six month period beginning October 1, 2008 and ending April 30, 2009; with the City having an option to renew services on a monthly basis thereafter to sustain the marketing development momentum as part of the city's ongoing Main Street Revitalization program. ARTICLE III Terms of Payment Section 3.01: The City agrees to pay the Economic Alliance a total of NINE THOUSAND AND NO/I00ths Dollars ($9,000.00) for the performance of the services provided herein for the initial six month period. If the City chooses to renew services thereafter on a monthly basis to sustain the marketing development momentum as part of the city's ongoing Main Street Revitalization program; the City agrees to pay the Economic Alliance FIFTEEN HUNDRED DOLLARS AND NO/lOOths Dollars ($1500) per month thereafter for the performance of ongoing monthly services. Section 3.02: The Economic Alliance, as part of the payment for services received, shall perform services outlined in this document in ARTICLE V. Section 3.03: The Economic Alliance shall bill the City upon execution of the contract and the City shall promptly process such statements, and make payment within thirty (30) days of receipt. ARTICLE IV Goal and Clarification of Assumptions Section 4.01: The goal of these services is to accelerate development of the City of La Porte's key Main Street projects and revitalization programs through targeted marketing development. Section 4.02: The geographic zone targeted for marketing extends from the east at Highway 146 to the west at the Intersection of Broadway, San Jacinto and Main Streets. Section 4.03: Clarification of Assumptions includes the following: Section 4.03 (a): As time and administrative factors allow, the Marketing efforts should compliment the branding theme defined by City of La Porte Branding Campaign and the Strategic Plan being developed, if timing of plan permits such inclusion. 2 Section 4.03 (b): The Property Owners and Developers are responsible for marketing their building. This service is meant only to compliment their efforts (and those of their real estate brokers) in order to accelerate overall development for the City of La Porte's Main Street Revitalization, including the two "bookend properties" known as the Gateway Building (912 West Main) and Town Plaza (intersection of San Jacinto, Broadway and Main Streets) and those properties located in between. Section 4.03 (c): The City of La Porte shall, through this separate services agreement, pay the Economic Alliance for overall implementation of this marketing development plan. Section 4.03 (d): The role of working with and selecting a graphics firm or other vendors shall be the responsibility of the Economic Alliance in its facilitation role. The City of La Porte shall reimburse the Economic Alliance for costs incurred specifically related to the creative graphic development and brochure printing. ARTICLE V Scope of Services Section 5.01: The scope of these services is outlined below in numerical step order: Step 1 - Create Marketing Team and Identify Roles and Responsibilities A Marketing Development Team shall be created and facilitated by the Economic Alliance. Selection of team members shall be made with input from the City of La Porte Economic Development Office and the City Manager's Office. Step 2 - Conduct Initial S. W. 0. T Analysis The Team should quickly identify strengths, weaknesses, opportunities, and threats that may be considered by future tenants; then develop message points as appropriate for future communications and for use in the marketing collateral materials. Step 3 - Begin Creation of Collateral Materials The Economic Alliance begins facilitation for development of marketing collateral materials for campaign which shall include: A Pocket Brochure: This fold-over brochure shall as much as possible capture the new "look and feel" of La Porte's brand and its revitalized Main Street, highlighting Gateway and Town Plaza. Any Property Owner on Main Street, 3 including the Town Plaza Developer may provide a complimentary piece which can be inserted in the fold-over. Step 4 - Pre-Collateral Calls and Website Advertising Initial marketing calls begin, with all activities coordinated by Economic Alliance, i.e. target audiences shall be structured by the Economic Alliance. The Economic Alliance shall include on their websites and in information related to real estate opportunities the available La Porte Main Street buildings open for lease. Step 5 - Collateral Mail Out Campaign Collateral materials shall be mailed by the Economic Alliance to target audiences outlined in Step 4. The Team members other than staff ofthe Economic Alliance may either provide addresses to Economic Alliance for their assigned targeted audiences, or if preferred, mail the materials directly from their offices. Step 6 - Follow-up Appointments Property Owners, including Town Plaza Developer Garson Silvers, or their designated Real Estate Brokers shall be available to go on appointments to companies targeted for mail campaign with the Economic Alliance or members of its Team. Step 7 - Status Check Meetings F or a period up to six months, the Economic Alliance will organize status check meetings with the Team, working to adjust strategy as needed. Step 8 - Continued Marketing After the six month Marketing Development Plan has been executed, the Economic Alliance service agreement may be extended on a monthly basis to sustain the program which will include continued web site marketing of available La Porte Main Street buildings as real estate opportunities, keeping collateral materials updated, and continuation of marketing calls. 4 ARTICLE VI Termination Section 6.01: The City may terminate this Agreement at any time by giving 30 days' written notice to the Economic Alliance. The City's right to terminate this Agreement for convenience is cumulative of all rights and remedies, which exist now or in the future. ARTICLE VII Miscellaneous Section 7.01: The relationship of the Economic Alliance to the City shall be that of independent contractor. The City shall have no authority to direct the day-to-day activities of any of the Economic Alliance's employees or representatives, shall have no authority over the Economic Alliance's decisions, and shall have no rights to ownership of internal working papers or other information or data of the Economic Alliance, except as otherwise specifically authorized or required herein. Section 7.02: This Agreement shall be subject to and construed in accordance with the laws of the State of Texas and of the United States of America and is performable in Harris County, Texas. All notices required or allowed hereunder shall be given in writing and shall be deemed delivered when actually received or on the third day following its deposit into a United States Postal Service post office or receptacle with prepaid postage affixed thereto, and sent by certified mail, return receipt requested, addressed to the respective party at the address set forth below, or at such other address the receiving party may have theretofore prescribed by written notice to the sending party: If to the City: La Porte Development Corporation 604 W. Fairmont Parkway La Porte, Texas 77571 Attention: Pat Muston, Chairman If to the Economic Alliance Economic Alliance Houston Port Region 908 West Main Street La Porte, Texas 77571 Attention: Jan Lawler, President/CEO 5 Section 7.03: This Agreement contains the entire agreement of the parties and any changes and amendments hereto must be in writing and signed by both parties. This Agreement is executed in two originals. ECONOMIC ALLIANCE B PORT ;ziN LA PORTE DEVELOPMENT CORPORATION: By -~~a!/J;: Pat Muston, Chairman ATTEST: LA PORTE DEVELOPMENT CORPORATION: By Ltf!attilA- 4tu Martha Gillette, Secretary La Porte Development Corporation By Brid~nllnistrative Manager Economic Alliance Houston Port Region 6