~~~~ ~~
December 19, 1984
Commissioner Fred Holland
304 Earl Drive
Kerrville, Texas 78028
RE: La Reata Ranch
Dear Fred:
Please find enclosed a copy of the
Restrictions and the Joint Venture Agreement of
La Reata Ranch.
I would sincerely appreciate your treating
these documents with confidence. They are the results
of many hours of study and concentration - unique only
to the ranch.
I enjoyed meeting with you last week and if
I can be of any help to you in the future it would be
my pleasure.
One Bent Tree Tower
16475 Dallas Parkway
Dallas, Texas 75248
214/931-2575
Yours very truly,
,~
:/ L~
Claude R. McClennahan, Jr.
/_
/ , r l »c.
,~~i~/
Enc 1 osure ~D ~ ~
7-- ~~ ~` ,s ~ . ~
/ ~/
~. J / (1 ,,/ V J/
~ ~ ~~ ~~
JOINT VENTURE AGREEMENT OF
LA REATA RANCH JOINT VENTURE
THIS AGREEMENT ("Agreement") is made and entered as of the 1st .
day of JanuarT, 1985, by and among CLAUDE R. McCLENNAHAN, JR. , an
individual residing in Dallas County, Texas, REESE DEVELOPMENT CORP. ,
a Texas corporation, and each of the persons whose names and places of
residence are set forth on Exhibit "A" attached hereto and incorporated
herein by reference for all purposes, as such is amended from time to time
(collectively referred to hereinafter as "Joint Venturers" and individually
referred to as a "Joint Venturer") .
W I T H E S SETH:
WHEREAS , the parties hereto desire to form this joint venture ("Joint
Venture") for the purpose of acquiring, owning, holding, improving,
operating , maintaining , leasing , and managing a certain parcel of real estate
("Property") located in Kerr County, Texas, described on Exhibit "B"
attached hereto and incorporated herein for all purposes ;
NOW THEREFORE , in consideration of the mutual promises and
covenants herein contained, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged , the parties
hereby agree as follows
I.
DEFINED TERMS
As used herein, the following terms shall have the meanings set forth
below unless the context clearly requires otherwise
1.01 "Affiliates" shall mean any <a) Joint Venturer, (b) member of
the immediate family [which means spouse; parents; children (including
those adopted); the direct descendents of such spouse, parents or
children; brothers ; sisters ; and the spouses of any such brothers or
sisters) of any Joint Venturer, (c) legal representative of any Joint
Venturer, <d) trustee for the benefit of any Joint Venturer, (e) if a Joint
Venturer is a corporation, joint venture, partnership or other business
entity, any person owning at least ten percent (10$) of such entity, or (f)
corporation, joint venture, partnership or other business entity of which a
majority of the voting interest is owned directly or indirectly by any one or
more of the persons or entities referred to in the preceding clauses (a)
through (e) .
1.02 "Code" shall mean the Internal Revenue Code of 1954, as
amended from time to time .
1.03 "Defaulting Joint Venturer" shall mean a Joint Venturer who
defaults in the performance of his obligations and duties under the terms
and provisions of this Agreement including, but not limited to, his
obligations as set forth in Section 3.03.
1.04 "Design Review Committee" shall mean that committee of
Joint Venturers appointed as set forth in Section 7.01.
1.05 "Joint Venture" shall mean the joint venture set forth in this
Agreement .
1.06 "Joint Venture Interest(s)" shall mean the Joint Venturers'
percentage interests in the Joint Venture as set forth on Exhibit "A"
attached hereto and incorporated herein by reference for all purposes .
1.07 "Joint Venture Property" or "Property" shall mean the real
property described on Exhibit "B" to this Joint Venture Agreement and ,
any improvements thereon, except any improvements constructed by
Lessees.
DINT VENTURE AGREEMENT -Page 1
1.08 "Majority in interest of the Joint Venturers" shall mean the
Joint Venturers owning more than 50$ of the total Joint Venture Interests
as set forth in Section 3.09 hereof .
1.09 "Management Committee" shall mean that committee of Venturers
appointed as set forth in Section 6.01.
1.10 "Lessees" shall mean those individuals who lease portions of
the Property from the Joint Venture under 99-year ground leases in order
to construct residences on the portions of the Property so leased.
1.11 "Net Cash Flow" shall mean the amount, if any, by which all
revenues received by the Joint Venture from the operations of its business
attributable to a particular period as determined in accordance with the
cash basis of accounting, together with all proceeds from the sale or
refinancing of all or any portion of the Property, loan proceeds, cash
contributions by the Joint Venturers and all other cash received by the
Joint Venture from any source, exceed all cash expenditures of any kind or
nature incurred by the Joint Venture attributable to such particular period
(including, without limitation, all debt service and amortization payments),
as determined in accordance with the cash basis method of accounting .
1.12 "Net Income or Net Loss" shall mean the gross revenues from
the operations of the business of the Joint Venture attributable to a
particular period, as calculated for federal income tax purposes, less all
items deductible by the Joint Venture for federal income tax purposes
attributable to a particular period. Income (including gain) and expenses
or loss resulting from or directly attributable to the sale of or refinancing
of all or any portion of the Property shall be included in Net Income or Net
Loss.
1.13 Non-Defaulting Joint Venturers) shall mean the joint
Venturers) other than the Defaulting Joint Venturers}.
1.14 "TMP" shall mean Tax Matters Partner as that term is defined
in Section 6231 of the Code.
II.
FORMATION OF THE VENTURE
2.01 Formation . The Joint Venturers hereby form the Joint Venture
for the limited purposes set forth herein .
2.02 Name. The name of the Joint Venture shall be La Reata Ranch
Joint Venture .
2.03 Principal Office. The principal office of the Joint Venture
shall be at 16475 Dallas Parkway, Suite 260, Dallas, Texas 75248, or such
other place or places as the Joint Venturers may from time to time
determine .
2.04 Partnership Act; Ownership. Except as is expressly herein
stipulated to the contrary, the rights and obligations of the Joint Venturers
and the administration and termination of the Joint Venture shall be
governed by the Texas Uniform Partnership Act (hereinafter the "Act") .
The interest of each Joint Venturer in the Joint Venture shall be personal
property for all purposes . All real and other property owned by the Joint
Venture shall be deemed owned by the Joint Venture as an entity, and nu
Joint Venturer individually shall have any ownership of such property ,
except as a tenant in partnership as provided in the Act. Each Joint
Venturer hereby waives any right to partition the Property .
2.05 Assumed Name Certificate. The Joint Venturers have executed
contemporaneously with the execution of this Joint Venture Agreement the
Assumed Name Certificate required by the Assumed Business or Professional
Name Act of the State of Texas, and the Joint Venturers agree to file such
certificates in each county in the State of Texas as is appropriate . In
addition, the Joint Venturers agree to execute and deliver in a timely
manner for filing any and all amendments to the Joint Venture's Assumed
Name Certificate which may be necessitated from time to time .
JOINT VENTURE AGREEMENT -Page 2
2.06 Purpose. The purpose of the Joint Venture shall be limited
strictly to acquiring, owning, holding, improving, operating, maintaining,
leasing, and managing the Property as a master-planned residential and
recreational ranch known as "La Reata Ranch" ; and engaging in such
operations and businesses as may be deemed necessary or appropriate to
the foregoing purposes . The purpose of the Joint Venture shall include
entering into 99-year ground leases with Joint Venturers, acting other than
in their capacities as joint venturers, with respect to parcels consisting of
portions of the Property, upon which shall be constructed single-family
residences and the development, ownership and maintenance of a lodge,
swimming pool , and other common area elements for the use and recreation
of the joint Venturers . The Joint Venture intends to preserve and enhance
the natural and rustic beauty of the Property . The Joint Venture shall not
engage in any other business without the consent of all the Joint
Venturers.
2.07 No Individual Authority. Except as otherwise expressly
provided in this Agreement or by separate written agreement executed by
all of the Joint Venturers , no Joint Venturer acting alone shall have any
authority to act for or to assume any obligation or responsibility on behalf
of the other Joint Venturers or the Joint Venture. Each Joint Venturer
shall indemnify and hold harmless the other Joint Venturers and their
Affiliates and the respective successors and assigns thereof , from any loss ,
liability, damage or expense arising out of any unauthorized actions by
such Joint Venturer or its Affiliates or their respective agents , or
employees .
2.08 No Prohibition . Nothing contained in this Agreement shall be
construed so as to prohibit any Joint Venturer from owning, operating or
investing in any real estate development not owned or operated by the Joint
Venture. Each of the Joint Venturers agrees that the other Joint
Venturers or any Affiliates may engage in or possess interests in other
business ventures of any nature and description, independently or with
others, including, but not limited to, the ownership, financing, leasing,
operation, management, brokerage and development of real property, and
may receive compensation or profits therefrom, for his own account and
without in any manner being obligated to disclose such business or
activities or assets or compensation or profit to the other Joint Venturers
or to the Joint Venture, and further, the Joint Venture and the other Joint
Venturers hereby waive any rights in and to said independent ventures or
to the income or profits derived therefrom.
2.09 Neither Responsible for the Other's Commitments . No Joint
Venturer nor the Joint Venture shall be responsible or liable for any
indebtedness or obligation of the other Joint Venturers incurred either
before or after the execution of this Agreement, except for those
responsibilities, liabilities, indebtedness or obligations incurred pursuant to
the terms of this Agreement, and each Joint Venturer agrees to indemnify
and hold the other Joint Venturers harmless from such indebtedness and
obligations as are not herein excepted.
III.
CAPITAL CONTRIBUTIONS
3.01 Initial Contributions . The Joint Venturers acknowledge that
each Joint Venturer has contributed to the Joint Venture the sum set forth
opposite his respective name on Exhibit "A" attached hereto and
incorporated herein by reference for all purposes.
3.02 Additional Capital Contributions. Without creating any rights,
remedies, or claims in favor or or enforceable by any third party, the Joint
Venturers agree to make additional capital contributions from time to time in
accordance with the provisions herein and in the same percentages as set
forth on Exhibit "A" attached hereto and incorporated herein by reference
for all purposes and in such amounts as are sufficient to enable the Joint
Venture to carry out the purposes of this Agreement and defray the
expenses of operating the Joint Venture including, without limitation, taxes,
insurance, escrow payments, amortization payments of principal and interest
in connection with any indebtedness incurred by the Joint Venture or any
indebtedness secured by liens covering the Propert~~, repair and
maintenance expenses of the Property, expenditures for capital
OINT VENTURE AGREEMENT - Page 3
improvements and replacements, management fees, legal and accounting
fees, funding deficit cash flows, and any and all other expenses necessary
or appropriate to the ownership, operation, management, leasing and sale of
the Joint Venture Property or any interest therein. If additional capital
contributions are required to be made pursuant to this Section 3.02 , the
Management Committee shall give notice to each Joint Venturer in the
manner provided in Section 12.01. Such notice shall specify fn reasonable
detail the amount and purpose of any such additional capital contributions .
Each Joint Venturer shall, within ten (10) days of the receipt of such
notice from the Management Committee, deposit with the Management
Committee the additional capital contribution required by such notice .
3.03 Failure to Make Additional Capital Contributions . Each Joint
Venturer shall be personally liable to the Joint Venture for paying the full
amount of his additional capital contribution obligations pursuant to Section
3.02. In the event that a Joint Venturer shall at any time default in his
obligations under the provisions of Sections 3.02 or 3.03, and such default
shall continue for a period of twenty (20) days after- the receipt of written
notice from the Management Committee of such additional capital contribution
obligation, such Defaulting Joint Venturer shall lose all rights with respect
to the Joint Venture. In addition to the foregoing, the Joint Venture may
exercise by notice to the Defaulting Joint Venturer any one or more of the
following rights or remedies:
(a) Taking such action (including, without limitation, the filing
of a lawsuit) which the Joint Venture deems appropriate to obtain
the payments by the Defaulting Joint Venturer of that portion of
the contribution that is in default together with interest thereon
at the interest rate of fifteen percent (15$) per annum
compounded daily from the date the capital contribution was due
until the date such contribution is made , at the cost and expense
of the Defaulting Joint Venturer;
(b) Permitting the Non-Defaulting Joint Venturers that desire to
do so to advance on behalf of the Defaulting Joint Venturer the
portion of the contribution that is in default, with the following
results
(i) The sum thus
loan from the
the Defaulting
of such sum
Defaulting Joi;
3.02,
advanced shall be deemed to be a
Non-Defaulting Joint Venturers to
Joint Venturer and a contribution
to the Joint Venture by the
nt Venturer pursuant to Section
(ii) The principal balance of such loan plus interest
thereon at the rate of fifteen percent (15 0) per
annum shall be due and payable in full within
thirty (30) days after written demand therefore
has been given to the Defaulting Joint Venturer
by the Non-Defaulting Joint Venturers,
(iii) The loan shall bear interest from the date that
the loan was made until the date that such loan,
together with all interest accrued thereon, is
repaid to the Non-Defaulting Joint Venturers,
(iv) All distributions from the Joint .Venturer that
would otherwise be made to the Defaulting Joint
Venturer (whether ft be before or after the
dissolution of the Joint Venturer) shall instead,
be paid to the Non-Defaulting Joint Venturers
until the loan and all interest accrued thereon
have been repaid in full to the Non-Defaulting
Joint Venturers (with all such payments being
applied first to interest earned and then to
principal) ,
(v) Repayment of the loan and all interest accrued
thereon shall be secured by a security interest in
the defaulting Joint Venturer's interest in the
JOINT VENTURE AGREEMENT - Page 4
Joint Venture, as more fully set forth in Section
3.04, and,
(vi) The Non-Defaulting Joint Venturers shall have
the right, in addition to the other rights and
remedies granted to them pursuant to this
Agreement available to them at law or in equity,
to take such action (including, without limitation,
the filing of the lawsuit) as the Non-Defaulting
Toint Venturers deem appropriate to obtain
payment by the Defaulting Joint Venturer of the
principal balance of such loan and all accrued and
unpaid interest thereon , at the cost and expense
of the Defaulting Joint Venture;
(c) Exercising the rights of the secured party under the
Uniform Commercial Code of the State of Texas, as more fully set
forth in Section 3.04 ;
(d) Dissolving the Joint Venture;
(e) Exercising any other rights and remedies available at law or
in equity; or
(f) Designating a substitute Joint Venturer, which may include
any Joint Venturer or his Affiliates who shall have the right to
purchase the Defaulting Joint Venturer's interest in the Joint
Venture for Ten Dollars ($10.00) and the assumption by such
designee of the Defaulting Joint Venturer's unpaid capital
contribution obligation.
Each Joint Venturer hereby grants each member of the
Management Committee an irrevocable, special power of attorney,
coupled with an interest, which shall survive the death, incompetency
or legal disability of each Joint Venturer, to take all actions necessary
to effectuate any of the remedies set forth above and to grant the
security interest set forth in Section 3.04 below.
3.04 Grant of Security Interest. Each Joint Venturer hereby
grants to the Joint Venture [and to the Non-Defaulting Joint Venturers, in
respect of any loans made by the Non-Defaulting Joint Venturers to the
Defaulting Joint Venturer pursuant to Section 3.03(b)), as security for: (i)
the payment of all contributions to be made by such Joint Venturer
pursuant to this Agreement; and (ii) repayment of any loans and all
interest accrued thereon made by the Non-Defaulting Joint Venturers to a
Defaulting Joint Venturer pursuant to Section 3.03(b) , a security interest
in and to his interest in the Joint Venture, all pursuant to and in
accordance with the provisions of the Uniform Commercial Code of the State
of Texas, and agrees that, in the event of any default in the payment of
such contributions or in the repayment of such loans and all interest
accrued thereon , the Joint Venture or the Non-Defaulting Joint Venturers ,
as applicable, shall have and are hereby granted all rights and remedies of
a secured party under the Uniform Commercial Code of the State of Texas
with respect to the security interest granted herein . Each Joint Venturer
further agrees to execute and deliver to the other Joint Venturers all such
financing statements and other instruments as may be required by the
Non-Defaulting Joint Venturers to effectuate and carry out the provisions of
the immediately preceding sentence and agrees that, at the option of the
Non-Defaulting Joint Venturers, this Agreement may serve as the necessary
security agreement and financing statement.
3.05 Loans to the Joint Venture by Joint Venturers . Upon request
of the Management Committee, any Joint Venturer may make loans to the
Joint Venture in such amounts, on such terms, and for such purposes as
may be from time to time approved by a Majority in interest of the Joint
Venturers . The amount of any loan made to the Joint Venture by a Joint
Venturer shall not be considered an increase in such Joint Venturer's
capital contribution or otherwise a contribution to the Joint Venture nor
shall the making of such loan entitle such Joint Venturer to an increased
share of the profits or losses or distributions to be made pursuant to the
provisions of this Agreement. Such loans shall bear interest at a rate
JOINT VENTURE AGREEMENT -Page 5
equal to one percent (1~) over the prime rate charged by the bank where
the Joint Venture's principal operating bank account is located .
3.06 Capital Account Adjustments . Each Joint Venturer shall have
a capital account ("Capital Account") which shall
(a) be increased by the amount of cash and the fair market
value of any property contributed by him to the Joint Venture
pursuant to this Agreement, and the amount of Net Income
allocated to him ; and
(b) be decreased by the amount of Net Loss allocated to him and
by all amounts of cash and the fair market value of any property
distributed to him pursuant to this Agreement.
3.07 Return or Withdrawal of Contributions . A Joint Venturer shall
not be entitled to demand a refund or return of any capital contribution, or
to withdraw any part of his Capital Account or to receive any distribution
from the Joint Venture, except as provided in this Agreement. No
unrepaid capital contribution shall be deemed or considered to be a liability
of the Joint Venture or any of the Joint Venturers . No Joint Venturer
shall be required to contribute to the Joint Venture to enable the Joint
Venture to return any of the Joint Venturers' capital contributions.
3.08 No Interest. No Joint Venturer shall be entitled to be paid
interest in respect of either his Capital Account or any contributions made
by him to the Joint Venture , except as may be expressly provided within
this Joint Venture Agreement.
3.09 Joint Venturer Interest. Except as expressly provided herein,
the percentage interest in the Joint Venture of the Joint Venturers shall be
as set forth on Exhibit "A" attached hereto and incorporated herein by
reference for all purposes , all as the same may be changed from time to
time in accordance with the provisions of this Agreement.
3.10 Liability on Joint Venture Indebtedness . Each Joint Venturer
hereby agrees that the liability with respect to all Joint Venture
indebtedness among the Joint Venturers, shall be several, and not joint and
several, on a pro rata basis in accordance with their Joint Venture
Interests as set forth in Section 3.09 and that each Joint Venturer shall be
entitled to seek indemnity and contribution with respect to such
indebtedness from all other Joint Venturers .
IV.
ALLOCATION OF INCOME OR LOSS;
DISTRIBUTIONS OF CASH AND OTHER ITEMS
4.01 Allocation of Net Income or Net Loss. The Net Income or Net
Loss of the Joint Venture and tax credits for each fiscal year including ,
but not limited to, that derived from the lease or sale of all or substantially
all of the Property (or any portion thereof) shall be allocated to the Joint
Venturers in accordance with their Joint Venture Interests in effect on the
date such Net Income or Net Loss is earned or incurred, as the case may
be. ,
4.02 Distributions of Net Cash Flow. Subject to the provisions of
Section 3.03(b)(iv) above, for each calendar year during the term hereof,
the Net Cash Flow of the Joint Venture less the amount determined by the
Management Committee as required fora reasonable working capital reserve
and additional reserves deemed necessary by the Management Committee to
pay anticipated expenses including taxes, insurance, capital repairs and
replacements , and such other expenses or costs , debts and obligations
incident to the ownership, management and leasing of the Property which
shall become due and payable within the succeeding calendar year and for
which the cash to make such payment(s) may not be generated by
operations during such calendar year, shall be distributed to the Joint
Venturers in accordance with their Joint Venture Interests as set forth in
Section 3.09.
JOINT VENTURE AGREEMENT - Page 6
V.
COMPENSATION AND FEES TO JOINT
VENTURERS OR AFFILIATES
5.01 Compensation and Fees. Except as is provided in Section
6.05 , no payment of any kind whatsoever will be made by the Venture to
any Joint Venturers or Affiliates thereof unless expressly approved in
writing by a Majority in interest of the Venturers.
5.02 Reimbursement. The Joint Venturers or their Affiliates shall
receive reimbursement from the first cash available for all expenses
advanced by them on behalf of the Joint Venture in connection with the
acquisition of the Property, and the formation, organization, operation and
liquidation of the Joint Venture including, without limitation, legal and
accounting fees, earnest money deposits, appraisals, and any and all other
advances or expenses incurred .
VI.
CONTROL AND MANAGEMENT
6.01 Selection of Management Committee . The affairs of the Joint
Venture shall be governed by a Management Committee composed of three
<3) Joint Venturers ; provided , however , in the event there are at any time
less than three <3) Joint Venturers, the Management Committee shall be
composed of such lesser number of Joint Venturers unless otherwise
provided herein. The initial Management Committee shall be Claude R.
McClennahan , Jr . Each member of the Management Committee shall serve
for a term of five (5) years or until his earlier death, resignation or
removal from office; provided, however, that the initial Management
Committee shall serve until the first annual meeting of Joint Venturers . A
Majority in interest of the Joint Venturers shall have the right to remove
any member of the Management Committee with or without cause . No
Defaulting Joint Venturer may serve as a member of the Management
Committee and any Joint Venturer who becomes a Defaulting joint Venturer
while a member of the Management Committee shall be deemed to have
resigned such position as of the date such Joint Venturer becomes a
Defaulting Joint Venturer. A Majority in interest of the Joint Venturers,
excluding the interest of any Defaulting Joint Venturer, shall select another
Joint Venturer to serve as a member of the Management Committee in the
event of a resignation, removal or other vacancy.
6.02 Management Committee's ResponsibilitieslDelegation . The
Management Committee shall be responsible for conducting the ordinary and
usual business and affairs of the joint Venture in accordance with and as
limited by the provisions hereof . The Management Committee shall have the
right to delegate the power and authority (but not the responsibility) to act
on behalf of the Management Committee to such individuals or entities as the
Management Committee may designate, provided the Management Committee
shall give written notice thereof to the Joint Venturers .
6.03 Duties and Functions . The Management Committee on behalf of
the Joint Venture, shall have the right, authority, and power to implement
all decisions requiring the approval of all Joint Venturers or a Majority in
interest of the Joint Venturers, to conduct the business and affairs of the
Joint Venture on a day-to-day basis and, without limiting the generality of
the foregoing, to conduct or cause to be conducted the following functions
of the Joint Venture to the same degree and in the same manner as a
prudent man would cause same to be conducted under the same or similar
circumstances
(a) To administer and enforce any covenants, conditions,
restrictions , easements , uses , limitations or obligations affecting
the Property, as such may be recorded from time to time;
(b) To keep the Property, except the portions thereof leased to
the Lessees, in good order, condition and repair;
(c) To enter into 99-year ground leases with Lessees with
respect to portions of the Property;
JOINT VENTURE AGREEMENT - Page 7
(d) To insure and keep insured, in reasonable amount, the
Property and to obtain and maintain liability insurance covering
the Property and the Joint Venture, in reasonable amounts;
(e) To make reasonable rules and regulations for the operation
of the Property and to amend such rules and regulations from
time to time ;
(f) To employ architects, engineers, contractors, attorneys,
foreman, employees and other persons necessary or appropriate to
carry out the business of the Joint Venture;
(g) To the extent that funds of the Joint Venture are available,
pay all debts and other obligations of the Joint Venture, in
accordance with the provisions of this Joint Venture Agreement;
(h) To collect all sums due to the Joint Venture;
(i) To the extent that Net Cash Flow is available, distribute the
same as provided in Article IV hereof ;
<j) To enter into , make , and perform such agreements and
execute such documents on behalf of the Joint Venture as the
Management Committee determines to be reasonably necessary ,
including those agreements and documents necessary to acquire
the Property and to obtain the requisite financing for such
acquisition ; and
(k) To perform other obligations provided elsewhere in the
Agreement to be performed by the Management Committee.
6.04 Meetings of Management Committee. Regular meetings of the
Management Committee shall be held at such time and place as shall be
determined from time to time by a majority of the members of the
Management Committee; provided, however, that at least one (1) meeting
shall be held each fiscal quarter. Special meetings of the Management
Committee may be called by any member of the Management Committee . At
least three (3) days' notice of any meeting shall be given to each member of
the Management Committee either personally or by mail, telephone or
telegram. Each member of the Management Committee shall be entitled to
one vote at any meeting of such committee and a majority vote, in number,
shall be controlling on any matter upon which a vote is taken . Any action
permitted or required to be taken at a meeting or by the vote of the
Management Committee may be taken without a meeting if a consent in
writing, setting forth the action so taken, shall be signed by all members
of the Management Committee and such consent shall have the same force
and effect as the required affirmative vote of the Management Committee.
The Management Committee shall keep minutes of all of its meetings, which
minutes shall be kept with the other books and records of the Joint Venture
and shall be available for inspection by any Joint Venturer.
6.05 Agreements with Affiliates . The Management Committee shall
have the right to enter into any contract, agreement, lease or other
arrangement for the furnishing to. or by the Joint Venture of goods or
services with any party or entity related to or affiliated with any Joint
Venturer or with respect to which any Joint Venturer or party or entity
related to or affiliated with any Joint Venturer has any direct or indirect
ownership or control, provided that such arrangement is reasonably
necessary and customary, that the compensation and other terms are
reasonable, the affiliation or relationship is fully disclosed to all Joint
Venturers , and that the contract is promptly reported to all Joint
Venturers .
6.06 No Sale Without Consent. Notwithstanding any provisions
herein contained to the contrary, the Property may not be sold, refinanced
or otherwise disposed of without the written consent of two-thirds in
interest of the Joint Venturers . In the event that approval or disapproval
of such sale, refinancing or other disposition is not received from a joint
Venturer by the Management Committee within fifteen (15) days of notice of
such proposal is provided as set forth in Section 12.01, consent will be
deemed made by the Joint Venturer failing to so respond.
JOINT VENTURE AGREEMENT - Page 8
6.07 Compensation . Each member of the Management Committee shall
devote such time to the business and affairs of the Joint Venture as is
reasonably appropriate, and shall receive no salary in such capacity.
6.08 Liability and Indemnification. No member of the Management
Committee nor any other party, when such party is acting on behalf of the
Management Committee as permitted by this Agreement, shall be liable ,
responsible or accountable in damages or otherwise to the Joint Venture or
any other Joint Venturer for any act or omission performed or omitted by
him in good faith pursuant to the authority granted to him by this
Agreement or otherwise by the Joint Venture, but only for fraud,
bad faith or gross negligence. Provided that the Management Committee or
such party acting for it has acted in good faith , the Joint Venture shall
indemnify and hold harmless each member of the Management Committee and
any party delegated by the Management Committee to act on behalf of the
Management Committee as permitted by this Agreement and any other agents
of the Joint Venture from any loss or damage incurred by reason of any act
performed or omitted by them on behalf of the Joint Venture or in
furtherance of the interest of the Joint Venture, the cost thereof having
been charged to the Joint Venture.
VII .
DESIGN REVIEW COMMITTEE
7.01 Appointment. The Design Review Committee shall review and
approve all residential development on the Property . The Design Review
Committee shall consist of three (3) members. Claude R. McClennahan, Jr.
shall serve as one of those members for a term of five (5) years
commencing on the date hereof . Except as otherwise determined by a
Majority in interest of the Joint Venturers, the remaining members of the
Design Review Committee shall be the remaining members of the Management
Committee , whose terms shall run concurrently with their terms as members
of the Management Committee . In the event Claude R . McClennahan , Jr . is
not a member of the Management Committee but his term as a member of the
Design Review Committee has not expired, then two (2) of the three (3)
members of the Management Committee shall serve as the remaining members
of the Design Review Committee with the selection of such individuals to be
made by the Management Committee . Except as otherwise determined by a
Majority in interest of the Joint Venturers , after the expiration of the
initial five (5) year term of Claude R. McClennahan, Jr. as a member of the
Design Review Committee, the Management Committee shall serve as the
Design Review Committee . The Design Review Committee shall meet at such
times and places as a majority thereof shall deem necessary in order to
carry out its duties and obligations .
7.02 Duties and Obligations . The Design Review Committee shall
have the right, power and authority to administer and enforce architectural
standards and design guidelines which exist with respect to the development
and construction of residential homesites on the Property and to consider
and act upon proposals or plans submitted to it from time to time pursuant
to such guidelines . The Design Review Committee shall have the power and
authority to amend such standards and guidelines from time to time if
deemed necessary or appropriate by such committee.
7.03 Compensation . Each member of the Design Review Committee
shall devote such time to the business and affairs of the Design Review
Committee and the Joint Venture as is reasonably appropriate, and shall
receive no salary in such capacity .
7.04 Liability and Indemnification. No member of the Design Review
Committee shall be liable, responsible or accountable in damages or
otherwise to the Joint Venture or any Joint Venturer or Lessee for any act
or omission performed or omitted by him in good faith pursuant to the
authority granted to him by this Agreement or otherwise by the Joint
Venture, but only for fraud, bad faith or gross negligence. Provided that
the Design Review Committee has acted in good faith , the Joint Venture
shall indemnify and hold harmless each member of the Design Review
Committee from any loss or damage incurred by reason of any act performed
or omitted by them on behalf of the Joint Venture or in furtherance of the
interest of the Joint Venture, the cost thereof having beezi charged to the
Joint Venture .
DINT VENTURE AGREEMENT - Page 9
VIII .
MEETINGS OF JOINT VENTURERS
8.01 Annual Meetings . Regular meetings of the Joint Venturers
shall be held annually on the second Friday of January of each calendar
year commencing in 1986. At each such annual meeting the Joint Venturers
shall select the members of the Management Committee who shall serve for
the following year. The Joint Venturers may also transact such other
business as may come before them.
8.02 Special Meetings . Special meetings of the Joint Venturers may
be held upon the call of the Management Committee or when called for by
Joint Venturers representing twenty-five percent (25%) or more in interest
of the Joint Venture . No business shall be transacted at a special meeting
of the Joint Venturers unless a Majority in interest of the Joint Venturers
are present at such meeting.
8.03 Notices of Meetings . Notices of annual and special meetings of
the Joint Venturers shall be given to ail Joint Venturers by the Management
Committee at least ten (10) days prior to the date of any such meeting.
8.04 Consent. Any action permitted or required to be taken at a
meeting or by the vote of the Joint Venturers may be taken without a
meeting if a consent in writing, setting forth the action so taken, shall be
signed by all of the Joint Venturers required to vote affirmatively with
respect to the subject matter thereof, and such consent shall have the same
force and effect as the required affirmative vote of the Joint Venturers .
Any such consent as well as the minutes of all proceeds of the Joint
Venturers , shall be kept with the books and records of the Joint Venture
and shall be available for inspection by all Venturers .
IX.
DURATION AND DISSOLUTION
9.01 Term. The Joint Venture shall continue until December 31,
2084, unless: (a) the Joint Venturers shall unanimously agree to its earlier
termination or the Property is sold prior to such date and all of the
proceeds accruing as a result of such sale have been actually received by
the Joint Venture and distributed to the Joint Venturers, i.e., note
payments (in which event the Joint Venture shall terminate); or (b) unless
earlier terminated as provided for in this Agreement.
9.02 Dissolution and Reconstitution. The Joint Venturers acknowledge
that the withdrawal , the expulsion , or the bankruptcy of a Joint Venturer ,
may each cause, technically, a dissolution of the Joint Venture. The Joint
Venturers hereby agree, however, that upon the occurrence of any of the
aforesaid events or the occurrence of any other event that may technically
cause a dissolution of the Joint Venture pursuant to the Texas Uniform
Partnership Act, the Joint Venture shall, except as specifically set forth to
the contrary in Section 9.03, automatically be reconstituted immediately and
shall be composed of the remaining Joint Venturers, who may continue the
business of the Joint Venture, either alone or with other persons, without
winding up and liquidating the affairs of the Joint Venture. The
reconstitution provided for in this- Section 9.02 shall not occur, and the
Joint Venture shall be wound up and terminated pursuant to the remainder
of this Article IX , only if the Non-Defaulting Joint Venturers or Joint
Venturers not subject to such event, as the case may be, shall so agree
within seven (7) days after the occurrence of the event in question.
9.03 Events Deemed to Cause Dissolution. The Joint Venture shall be
dissolved upon the first to occur of the following:
(a) The expiration of the term provided for in Section 9.01;
(b) The sale of all or substantially all of the assets of the Joint
Venture ; '
(c) The affirmative vote of two-thirds in interest of the Joint
Venturers to dissolve the Joint Venture;
JOINT VENTURE AGREEMENT -Page 10
<d) The Joint Venture shall (i) voluntarily consent to an order
for relief by filing a petition for relief under the laws of the
United Stated codified as Title 11 of the United States Code ;
(ii) seek, consent to, or not contest the appointment of a
receiver, custodian, or trustee for itself or for all or any
part of its property; (iii) file a petition seeking relief under
the bankruptcy, arrangement, reorganization, or other debt
or relief laws of any state or other competent jurisdiction ;
(iv) make a general assignment for the benefit of its
creditors or take any other similar action for the protection
or benefit of its creditors; or (v) admit in writing that it is
generally not paying its debts as such debts become due ; or
(e) The Joint Venture shall have (i) a petition filed against it
seeking an order for relief under the laws of the Unfted
States codified for relief under the laws of the United States
codified as Title 11 of the United States Code or seeking
relief under the bankruptcy, arrangement, reorganization, or
other debt or relief laws of any state or other competent
jurisdiction; or <ii) a court of competent jurisdiction enters
an order, judgment, or decree appointing, without the
consent of the Joint Venture, a receiver or a trustee for it,
or for all or any part of its property, and such petition,
order, judgment, or decree shall not be and remain
discharged or stayed within 60 days after its entry .
Dissolution of the Joint Venture shall be effective on the day on
which the event occurs giving rise to such dissolution, and the
Joint Venture shall not terminate until the assets of the joint
Venture have been distributed as provided herein below.
9.04 Winding up by Joint Venturers. Upon the dissolution of the
Joint Venture by expiration of the term hereof, by operation of law, by any
provisions of this Agreement, or by agreement between the Joint Venturers,
and it is not automatically reconstituted pursuant to this Agreement or
otherwise reconstituted by the affirmative vote of all the Non-Defaulting
Joint Venturers within thirty (30) days after the date of such dissolution,
the Joint Venture's business shall be wound up and all its assets
distributed in liquidation . In such dissolution , except as a result of the
purchase of all of the other Joint Venturers' interest by one of the Joint
Ventures <in which event the selling Joint Venturer shall have no further
interest hereunder) or as otherwise expressly provided herein, the
Management Committee shall be the liquidating Joint Venturer and shall
proceed to cause the Property to be sold and distribute the proceeds of
sale as provided under Section 9.07.
9.05 Winding up by Liquidating Joint Venturers . The liquidating
Joint Venturers shall have the right to wind up the Joint Venture and may
in such winding up either:
(a) Cause the Property to be sold and distribute the proceeds of
sale as provided in Section 9.07 below; or
(b) Except in respect of (i) all assets on which a single,
non-severable mortgage or other lien will be in effect after such
distribution, and (ii) any assets which the liquidating Joint
Venturers shall determine are not readily severable or
distributable in kind, the liquidating Joint Venturers, to the
extent that liquidation of such assets is not required to fulfill the
payments , if any , required under Paragraph 9.05 shall have the
right but not the obligation to distribute, in kind, all or any
portion of the Property and the other assets, if any, of the Joint
Venture to the Joint Venturers as set forth in the remainder of
Section 9 , 07 .
9.06 Distributions of Net Cash Flow. Upon the dissolution of the
Joint Venture for any reason , during the period of liquidation and until
termination of the Joint Venture, the Joint Venturers shall continue to
receive the Net Cash Flow and to share the Net Income and Net Loss for all
tax and other purposes as provided elsewhere fn this Agreement.
JOINT VENTURE AGREEMENT - Page 11
9.07 Distributions of Proceeds of Liquidation. The proceeds from
liquidation shall be applied and distributed in the following manner and in
the following order of priority:
<a) To the payments of debts and liabilities of the Joint
Venture, and the expenses of liquidation, other than Loans or
advances which may have been made by any Joint Venturer to the
Joint Venture;
(b) To the setting up of any reserves which the liquidating
Joint Venturers may deem necessary for any contingent or
unforeseen liabilities or obligations of the Joint Venture or of the
Joint Venture arising out of or in connection with the Joint
Venture , which reserves may be paid by the Joint Venturers to a
bank or trust company acceptable to the liquidating Joint
Venturers as escrow agent, to be held by it for the purpose of
disbursing such reserves in payment of any of the aforementioned
liabilities or obligations , and at the expiration of such period as
the liquidating Joint Venturers shall deem advisable, distributing
the balance, if any, thereafter remaining, in the manner
hereinafter provided ;
(c) To the repayment of any loans that may have been made by
any of the Joint Venturers to the Joint Venture;
(d) The remainder of such proceeds shall be distributed to the
Joint Venturers in accordance with their interests in the Venture
as set forth in Section 3.09.
9.08 Rights and Obligations. Upon such distribution and winding
up, the parties hereto shall be relieved of all obligations hereunder except
for obligations, duties or rights which have not been determined or
ascertained as of the date of such termination and for rights or remedies
which a Non-Defaulting Joint Venturer may have against a Defaulting Joint
Venturer in law or equity . During the period of such winding up , the
business and affairs of the Joint Venture shall be conducted so as to
complete, maintain and preserve the assets of the Joint Venture in a manner
consistent with the winding up of the affairs thereof .
9.09 Termination . After all of the assets of the Joint Venture have
been distributed as	hereinabove provided,	the	Joint Venture shall
terminate; but if, at	anytime thereafter, any	funds	of any cash reserve
fund referred to above	are released because the	need	for such cash reserve
fund has ended , such	funds shall be distribute	d to	the Joint Venturers in
the same manner as if such distribution had	been	made in the manner
provided above.			
X.
TRANSFER OF INTERESTS IN JOINT VENTURE
10.01 Written Consent Required . Except as is otherwise provided
herein, no Joint Venturer shall sell, assign, hypothecate or otherwise
dispose of its interest or any part thereof in the Joint Venture without the
prior written consent of the Management Committee, which in their sole
discretion may be withheld .
10.02 Written Consent Not Required . Notwithstanding the provisions
of Section 10.01, without the written consent of any Joint Venturer or the
Management Committee, all or any part of the interest in the Joint Venture
of any Joint Venturer who is an individual or an individual partner or
venturer of a partnership or joint venture which is a Joint Venturer
<hereinafter "Individual Joint Venturer") may be from time to time sold,
assigned or otherwise disposed of to such Joint Venturer's immediate family
as defined in Section 1.01 or to an entity in which more than eighty
percent (80$) of the voting interests are owned and which continue to be
owned by such Joint Venturer. In the event a permitted transferee
hereunder is composed of more than one individual, said transferees shall
designate, in writing to the Management Committee, one representative of
said transferees . Such representative to be deemed to have all requisite
authority to bind said transferees, and the Management Committee shall
have the right to rely on the decisions of said representative as being the
JOINT VENTURE AGREEMENT - Page 12
decisions of said transferees . In the event no such representative is
designated within ten (10) days after such transfer, the Management
Committee shall have the right to designate such representative.
10.03 Death or Incompetency of a Venturer. The death, legal
incompetency or other disability of a Joint Venturer shall not dissolve or
terminate the Joint Venture. Upon the death, legal incompetency or other
disability of a joint Venturer, the estate, personal representative, trustee,
guardian or other successor in interest of such Joint Venturer shall have
all of the rights and be liable for all of the liabilities of the Joint Venturer
to the extent of such Joint Venturer's interest in the Joint Venture, subject
to the terms and conditions of this Agreement, and with the consent of a
Majority in interest of the remaining Joint Venturers may be substituted for
such Joint Venturer. In the event there is more than one transferee of the
Joint Venture interest of a Joint Venturer, the transferees shall designate,
in writing to the Management Committee, one representative of said
transferees . Such representative shall be deemed to have all requisite
authority to bind all said transferees and the Management Committee shall
have the right to rely on the decision of the representative as being the
decision of said transferees . In the event no representative is designated
within ten (10) days after a transfer, the Management Committee shall have
the right to designate such representative .
10.04 Assumption of Assignee . Any assignment of an interest in the
Joint Venture permitted under this Article X shall be in writing, and shall
be an assignment and transfer of all of the assignor's rights and obligations
hereunder, and the assignee shall expressly agree in writing to be bound
by all of the terms of this Agreement and assume and agree to perform all
of the assignor's agreements and obligations hereunder existing or arising
subsequent to such assignment. Upon any such permitted assignment of all
of the assignor's interest, and after such assumption, the assignor shall be
relieved of its agreements and obligations hereunder arising after such
assignment. An executed duplicate copy of each such assignment of an
interest in the Joint Venture and the assumption of a Joint Venturer's
obligation shall be delivered to each Joint Venturer and to the Joint
Venture . Except as otherwise expressly provided herein , no permitted
assignment shall terminate the Joint Venture.
10.05 Amendment of Certificate . If an assignment of an interest in
the Joint Venture shall take place pursuant to the provisions of Article X,
then, unless the Joint Venture is terminated by such assignment, the
continuing Joint Venturer or Joint Venturers promptly thereafter shall cause
to be filed with the proper authority a certificate amending the fictitious or
assumed name of the Joint Venture in order to reflect such change.
10.06 Other Assignment Void. Any purported assignment of transfer
of an interest in the Joint Venture , not permitted by this Article X , shall
be null and void and of no effect whatsoever.
XI.
RECORDS , ACCOUNTS , AUDITING
11.01 Records, Accounts and Statements. The fiscal year of the
Joint Venture shall end on December 31st in each year. The Management
Committee shall prepare, or cause to be prepared, a statement of financial
condition of the Joint Venture as of the end of each fiscal year, such
statement to be delivered to each Joint Venturer as soon as is reasonably
practicable, but no later than ninety (90) days after the end of each fiscal
year. The Management Committee shall cause to be prepared and delivered
to each Joint Venturer, as soon as is reasonably practicable but no later
than ninety (90) days after the end of each fiscal year, all necessary tax
reporting information required by the Joint Venturers for preparation of
their respective federal income tax returns .
11.02 Tax Matters Partner.
(a) Claude R. McClennahan, Jr. shall be designated as the
tax matters partner ("TMP") for the Joint Venture , as that term
is defined in Section 6231 of the Code.
JOINT VENTURE AGREEMENT - Page 13
(b) Indemnity . The Joint Venture shall indemnify the TMP
against judgments, fines, amounts paid in settlement, and
expenses (including attorneys' fees) reasonably incurred by him
in any civil, criminal or investigative proceeding in which he is
involved or threatened to be involved by reason of being the
TMP, provided that the TMP acted in good faith, within what he
reasonably believed to be the scope of his authority and for a
purpose which he reasonably believed to be in the best interests
of the Joint Venture or the Joint Venturers . The TMP shall not
be indemnified under this provision against any liability to the
Joint Venture or its Joint Venturers to which he would otherwise
be subject by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the
conduct of his office. The indemnification provided hereunder
shall not be deemed exclusive of any other rights to which those
indemnified may be entitled under any applicable statute , agree-
ment, vote of the Joint Venturers, or otherwise.
(c) Replacement. The TMP may be removed upon the
affirmative vote of a Majority in interest of the Joint Venturers ;
provided, however, that such removal shall not be effective
unless another TMP is elected by a Majority in interest of the
Joint Venturers.
11.03 Inspection. Copies of all financial statements and federal and
state income tax returns of the Joint Venture shall be promptly distributed
to each of the Joint Venturers. Each Joint Venturer shall have the right to
inspect and examine the records and accounts of the joint Venture at
reasonable times. Each Joint Venture shall be entitled to an audit of the
records and accounts of the Joint Venture by representatives of such Joint
Venturer or by an accounting firm of his own choosing at any time at his
own expense .
11.04 Bank Account. The funds of the Joint Venture shall be
maintained in a bank selected by the Management Committee and in an
account or accounts in the name of the Joint Venture and shall be subject
to withdrawal only upon the signature or signatures of any individual or
individuals so authorized by the Management Committee.
XII.
MISCELLANEOUS
12.01 Notices . Except as may be otherwise specifically provided in
this Agreement, any notices or delivery required to be given hereunder
shall be deemed given or received, as the case may be, five (5) days after
having been deposited , registered or certified, return receipt requested ,
postage prepaid , in the United States mail , addressed to the parties at the
addresses set forth below their respective names set forth on Exhibit "A"
attached hereto and incorporated herein by reference for all purposes , or
at such different addresses as to any party as he shall have theretofore
advised the Management Committee in writing .
12.02 Amendment. Each Joint Venturer hereby authorizes and
empowers the Management Committee to amend this Agreement from time to
time to reflect the entry of additional Joint Venturers ; provided, however ,
that no such amendment may reduce the interest in the Joint Venture of
any Joint Venturer without his prior written consent. The Management
Committee shall promptly notify the Joint Venturers of any such
amendments .
12.03 Inurement and Binding Effect. Subject to the restrictions on
transfer set forth in Article XI, this Agreement shall inure to the benefit of
and be binding upon the successors and assigns of the parties hereto.
12.04 Counterparts . This Agreement may be executed in any
number of counterparts, and, notwithstanding that all parties did not sign
the same counterpart, each of such counterparts shall be deemed to be an
original and all of such counterparts shall constitute one and the same
agreement binding on all of the parties hereto. Joint Venturers may become
parties to this Agreement by executing and delivering to the Management
Committee a signature page hereto in form approved by the Management
Committee .
INT VENTURE AGREEMENT - Page 14
12.05 Entire Agreement. This Jofnt Venture Agreement and the
Exhibits hereto represent the entire agreement and understanding between
the parties hereto and supersede all other oral and written agreements ,
express or implied, concerning the subject matter of this Joint Venture
Agreement.
12.06 Severability . If any provision of this Agreement or the
application to any person or circumstance shall be held invalid or
unenforceable to any extent, the remainder of this Agreement and the
application of such provision to other persons or circumstances shall not be
affected thereby and shall be enforced to the greatest extent permitted by
law .
12.07 Venue . This Agreement shall be governed by and construed
in accordance with the laws of the State of Texas . The parties hereto
agree that this Agreement is performable in Dallas County, Texas, and fix
venue for any action regarding this Agreement in said County .
12.08 Modification. This Agreement cannot be changed, modified, or
terminated orally, and no waiver of compliance with any provision or
condition hereof , and no consent provided for herein shall be effective
unless evidenced by an instrument in writing, duly executed by the parties
hereto sought to be charged with such waiver or consent.
12.09 Headings . The article or section headings of this Joint
Venture Agreement are for convenience of reference only and do not form a
part hereof and do not in any manner modify, interpret, or construe the
intentions of the parties . Whenever the context hereof shall so require the
singular shall include the plural, the male gender shall include the female
gender and the neuter and vice versa .
12.10 Timeliness. Time is of the essence.
12.11 Additional Acts. In connection with this Agreement, as well as
all transactions contemplated by this Agreement, each Joint Venturer agrees
to execute and deliver such additional documents or perform such additional
acts as may be necessary or appropriate to effectuate , carry out and
perform all of the terms, provisions and conditions of this Agreement, and
all such transactions .
12.12 Deemed assent. The failure of a Joint Venturer to respond,
within the response period set forth in the request in question (which
response period shall not be less than seven (7) business days nor more
than twenty (20) business days from the date on which the Joint Venturer
in question is deemed to have received such request pursuant to Section
12.01, either in the affirmative or in the negative , to any request it
receives from another Joint Venturer relating to a proposed act and respect
of which such Joint Venturer is entitled to vote pursuant to this
Agreement, shall conclusively be deemed for all purposes to be a vote by
such Joint Venturer in favor of the act set forth in such request.
IN WITNESS WHEREOF, the parties have executed this Joint Venture
Agreement as of the day and year first above written .
CLA D R. N A AN, JR.
REESE DEVELOPMENT CORP.
BY=
Nam
Title: prPairlPnt
JOINT VENTURE AGREEMENT - Page 15
THE STATE OF TEXAS §
COUNTY OF DALLAS §
BEFORE ME, the undersigned authority, on this day personally
appeared CLAUDE R. McCLENNAHAN, JR. , a Venturer of LA REATA
RANCH JOINT VENTURE, a Texas joint venture, known to me to be the
person whose name is subscribed to the foregoing instrument, and
acknowledged to me that he executed the same for the purposes and
consideration therein expressed, in the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE on this the 1st .
day of Tanuary 1985.
NOTARY PUBLI IN AND FOR
THE STATE O TEXAS
DOROTHY KRETOW
(Print or Type Name of Notary Here)
hiy Commission Expires:
THE STATE OF TEXAS §
COUNTY OF DALLAS §
BEFORE ME, the undersigned authority, on this day personally
appeared C, R. McClennahan, Tr. President of REESE
DEVELOPMENT CORP. , a Texas corporation and a Venturer of LA REATA
RANCH JOINT VENTURE, a Texas joint venture, known to me to be the
person whose name is subscribed to the foregoing instrument, and
acknowledged to me that he executed the same for the purposes and
consideration therein expressed, in the capacity therein stated on behalf of
said corporation .
GIVEN UNDER MY HAND AND SEAL OF OFFICE on this the 1st .
day of ,Tanuary 1985.
NOTARY PUBL IN AND FOR
THE STATE OF TEXAS
DOROTHY KRETOW
(Print or Type Name of Notary Here)
My Commission Expires
JOINT VENTURE AGREEMENT - Page 16
Joint Venturer
Claude R. McClennahan, Jr.
16475 Dallas Parkway
Suite 260
Dallas , Texas 75248
Reese Development Corp .
16475 Dallas Parkway
Suite 260
Dallas , Texas 75248
EXHIBIT "A"
Interest in
Joint Venture
50$
50$
Capital
Contribution
OINT VENTURE AGREEMENT - Page 1?
EXHIBIT "B"
Being a 313.24 acre tract or parcel of land conveyed as 316 acres, more or
less, to C. E. Erwin from Stephen F. Gilmore, et ux, by deed dated
July 30, 1973, and recorded in Volume 165, Page 846, of the Deed Records
of Kerr County, Texas; and being comprised of 2 acres, more or less, out
of G. H. Bierman Survey No. 684, Abstract No. 39; 21 acres, more or less,
out of C.C.S.D. & R. G.N.G. Survey No. 1120,. Abstract No. 1496; and
290.28 acres, more . or less, out of H.E.W.T.R.R. Co. , Survey No. 1473,
Abstract No. 777, all in Kerr County, Texas; and being more particularly
described by metes and bounds as follows
BEGINNING at a ~" iron stake set at a fence cornerpost for the south
corner of the herein described tract, which point is the east corner of
Delores Cortez Y. Garcia Survey No. 1509 and the south corner of said
Survey No. 1473;
THENCE along a fenceline which forms the southwest boundary of the
herein described tract, N .46°09'W . 144.50 feet to a fence anglepost and ~"
iron stake and N.43°53'W. 3807.67 feet to a fence cornerpost and ~" iron
stake in the southeast right-of-way line of Sheppard-Rees Road, a County
road, for the southwest corner of the herein described tract;
THENCE along a fenceline, along or abutting the southeast right-of-way line
of said Sheppard-Rees Road, which forms the northwest boundary of the
herein described tract the following nine (9) calls: each point being an iron
stake and fence anglepost: N.46°28'E. , 140.71 feet; N.12°38'E. , 96.43 feet;
N.10°41'W., 767.08 feet; N.10°59'E., 64.77 feet;~N.27°23'E., 131.31 feet;
N.37°40'E., 682.79 feet; N.36°39'E., 393.01 feet; N.54°31'E., 24.09 feet;
and N.72°31'E, 1449.46 feet to a ~" iron stake and fence cornerpost for the
north corner of the herein described tract;
THENCE along a fenceline which forms the northeast boundary	of the herein
described tract the following nine (9} calls,	each	point being	an iron	stake
and fence anglepost: 5.44°43'E., 1185.28	feet;	5.80°39'E.,	393.88	feet;
5.58°40'E., 210.08 feet; S.54°30'E., 260.43	feet;	S.22°20'W.,	296.98	feet;
5.28°02'E., 424.64 feet; S.O1°16'E., 343.20	feet;	S.49°O1'E.,	220.95	feet;
and S.43°12'E. , 896.88 feet to a ~" iron stake and fence cornerpost for the
east corner of the herein described tract;				
THENCE along a fenceline which forms the southeast boundary of the herein
described tract, the following six (6) calls, each point being an iron stake
and fence anglepost: 5.46°34'W., 491.99 feet; 5.33°40'W., 347.66 feet;
S.45°14'W., 969.60 feet; S.41°31'W., 479.44 feet; S.28°52'W., 654.70 feet;
and S.14°42'E. , 76.22 feet to the PLACE OF BEGINNING, containing 313.24
acres of land within these metes and bounds.
JOINT VENTURE AGREEMENT -Page 18