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<br />31 <br /> <br /> <br /> <br /> <br />PROMISSORY NOTE AND <br />COMPROMISE SETTLEMENT AGREEMENT <br /> <br /> <br />THIS PROMISSORY NOTE AND COMPROMISE SETTLEMENT AGREEMENT <br />is made and delivered by FREESE & NICHOLS, INC. ("Freese & <br />Nichols") to the CITY OF SAN MARCOS ("City"), and is agreed to <br />and accepted by City, in full accord and satisfaction and as <br />the compromise and settlement of a dispute arising between the <br />parties hereto over the design and construction of the <br />apparatus room floor, sidewalks and driveways of Fire Station <br />No.4 (" Fire Station"). The partie s hereto agree that thi s <br />Promissory Note and Compromise Settlement Agreement is given <br />and accepted as a compromise of a disputed claim and that the <br />execution and delivery of this Promissory Note and Compromise <br />Settlement Agreement does not constitute an admission of fault <br />by Freese & Nichols as to any of the matters involved in the <br />dispute described above. <br /> <br />Subject to the conditions precedent stated below, <br />Freese & Nichols agrees to pay to City, on demand, the sum of <br />money, not to exceed THIRTY THREE THOUSAND THREE HUNDRED <br />SEVENTY-FIVE AND NO/I00 DOLLARS ($33,375.00), necessary to <br />reasonably repair any condition which occurs in the Fire <br />Station apparatus room floor, sidewalks or driveways which <br />constitutes the satisfaction of a condition precedent as those <br />conditions precedent are described below. All of the <br />following conditions precedent must be satisfied before <br />Freese & Nichols is obligated to pay any money under the terms <br />of this Promissory Note and Compromise Settlement Agreement: <br /> <br />1. The Promissory Note is due and payable (as <br />described above) when presented to Robert L. Nichols at <br />his offices in Fort Worth, Tarrant County, Texas, within <br />five years from the date of the execution by City of a <br />written acceptance of the remedial repairs performed on <br />the Fire Station apparatus room floor, sidewalks and <br />driveways. This Note is not valid and is not due and <br />payable if presented after the period described above. <br /> <br />2. The Promissory Note is due and payable (as <br />described above) only in the event that: <br /> <br />(a) the remedial repairs performed on the Fire <br />Station apparatus room floor, sidewalks or driveways <br />do not put the Fire Station apparatus room floor, <br />sidewalks or driveways into such a condition that <br />they can be occupied and used by City for the usual <br />and ordinary purposes for which such apparatus room <br />floors, sidewalks or driveways are ordinarily used <br />in fire stations in the City of San Marcos either <br />presently or considering reasonable future <br />expanS1On¡ <br /> <br />(b) the apparatus room floor, sidewalks or <br />driveways fail to perform and accomplish their <br />ordinary purposes in the manner normally expected of <br />such concrete structures¡ and <br /> <br />(c) the occurrence of conditions otherwise <br />satisfying subparagraphs (a) and (b) but which are <br />caused solely by some act or omission of a person or <br />entity other than Freese & Nichols or its subcontrac- <br />tors, will not result in the Promissory Note becoming <br />due and payable in whole or part. <br /> <br /> <br /> <br />THIS AGREEMENT IS SUBJECT TO ARBITRATION UNDER THE TEXAS <br />GENERAL ARBITRATION ACT. --- <br /> <br /> <br /> <br />PROMISSORY NOTE AND COMPROMISE SETTLEMENT AGREEMENT, Page 1 <br />