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RE 2002-12-10.2 2206053 373~(~2 $35,~) Deed RESOLUTION NO. ~~~_~- / r~.~ A RESOLUTION OF THE CITY OF COPPELL~ TE~S~ APPROVING THE TE~S ~D CO~ITIONS OF A T~ ~ATEMENT AG~EMENT BY ~D BETWEEN THE CI~ OF COPPELL~ TE~S ~D THE WASHINGTON MUTU~ B~K~ FA; AUTHO~ZING ITS E~CUTION BY THE ~YOR; ~D PROVIDING ~ EFFECTI~ DATE. ~E~AS, ~e Ci~ Co~cil h~ been presented a proposed T~ Abatement A~eement by and be~een the CiW of Coppell, Tex~ ~d Was~on Mural B~, FA, a copy of which is aaached hereto ~d inco~orated herein by reference; ~d WHE~AS, upon hll review ~d consideration of ~e A~eement, ~d all ma~ers related thereto, the City Co~cil is of the opi~on ~d ~ds ~at ~e te~s ~d con~fions ~ereof should be approved, ~d that the Mayor should be authorized to execute the A~eement on behalf of the CiW of Coppell, Text; NOW, THE~FO~ BE IT ~SOL~D BY THE CITY COUNCIL OF THE CITY OF COPPELL, TE~S, THAT: SECTION 1. The A~eement a~ached hereto having been reviewed by the City Council of the CiW of Coppell, Texas, ~d fo~d to be acc~table ~d in the best interest of the City ~d its citizens, be, ~d the s~e is hereby, in ~1 t~ngs approved, ~d ~e Mayor is hereby authorized to execute the A~eement on behalf of the CiW of Coppell, Texas. SECTION 2. The CiW Co~cil finds that ~e improvements proposed to be built upon the Premises described in ~e A~eement will e~ce the economic ~taliW of the co~W t~ou~ a combination of new capital inves~ent, increased sales t~ revenues, ~d the creation of additional job opportunities. SECTION 3. The inventory, and supplies. SECTION 4. The tax abatement to be granted by the Agreement will not include improvements proposed abatement guidelines of the City of Coppell, Texas. for the Premises will accomplish the tax 52406 SECTION 5. The City Manager delivered to the presiding officer of the governing body of each taxing unit in which the property subject to the Agreement is located, a written notice that the City of Coppell, Texas, intends to enter into the Agreement. The notice given by the City Manager included a copy of the Agreement approved by this Resolution. SECTION 6. This Resolution and the Tax Abatement Agreement are hereby approved by the affirmative vote of the majority of the members of the City Council of the City of Coppell, Texas, at a regularly scheduled meeting of the City Council. SECTION 7. This Resolution shall become effective immediately from and after its passage. DULY RESOLVED AND ADOPTED by the City Council of the City of Coppell, Texas, on this the ~_0____~day o~2002. CITY OF CDPPELL, TEXAS ~ ~ CANDY SHEEHAN~MAYOR ATTEST: LIBBY BAL~/~ITY SECRETARY R~O~E ,RT,~ ~E:^~AC~, CITY ATTORNEY (PGS/tc 12/03/02) zoo O 35 03731 2 52406 STATE OF TEXAS § COUNTY OF DALLAS § TAX ABATEMENT AGREEMENT This tax abatement agreement (the "Agreement") is entered into by and between the City of Coppell, Texas (the "City"), duly acting herein by and through its Mayor and Washington Mutual Bank, FA ("Owner") acting by and through its authorized officer. WITNESSETH: WHEREAS, the City Council of the City of Coppell, Texas, (the "City"), passed an Ordinance (the "Ordinance") establishing Tax Abatement Reinvestment Zone No. 28 (the "Zone"), for commercial/industrial tax abatement, as authorized by the Property Redevelopment and Tax Abatement Act, Chapter 312 of the Texas Tax Code, as amended (the "Tax Code"); and WHEREAS, the City has adopted guidelines for tax abatement (the "Tax Abatement Guidelines"); and WHEREAS, the Tax Abatement Guidelines contain appropriate guidelines and criteria governing tax abatement agreements to be entered into by the City as contemplated by the Tax Code; and WHEREAS, the City has adopted a resolution stating that it elects to be eligible to participate in tax abatement; and WHEREAS, in order to maintain and enhance the commercial and industrial economic and employment base of the Coppell area, it is in the best interests of the taxpayers for the City to enter into this Agreement in accordance with said Ordinance, the Tax Abatement Guidelines and the Tax Code; and WHEREAS, Owner has or intends to lease approximately 50,000 square feet of certain improvements located at 555 Dividend Drive, Coppell, Texas in the Gateway Corporate Center (hereinafter defined as the "Improvements") and intends to locate Tangible Personal Property (hereinafter defined) at the Improvements; and WHEREAS, the City previously entered into that certain tax abatement agreement with Catellus Development Corporation for the Improvements dated December 14, 2000; and WHEREAS, the development efforts described herein will create permanent new jobs in the City; and WItEREAS, the City Council finds that the contemplated use of the Improvements and the contemplated Tangible Personal Property to be added to the Improvements, and the other terms hereof are consistent with encouraging development of the Zone in accordance with the purposes for its creation and/or in compliance with the Tax Abatement Guidelines, the Ordinance adopted by the City, the Tax Code and all other applicable laws; and TAX ABATEMENT AGREEMENT - Page 1 52360 zoo: O 35 03732 WHEREAS, the City Council finds that the Improvements and the Tangible Personal Property sought are feasible and practicable and would be of benefit to the Premises (hereinafter defined) to be included in the Zone and to the City after expiration of this Agreement; and WHEREAS, a copy of this Agreement has been furnished, in the manner prescribed by the Tax Code, to the presiding officers of the governing bodies of each of the taxing units in which the Premises is located; and WHEREAS, the City desires to enter into an agreement with Owner, the proposed lessee of the Improvements, and the owner or lessee, of Tangible Personal Property to be added to the Premises within the Zone for the abatement of taxes pursuant to the Tax Code as amended; NOW, THEREFORE, in consideration of the mutual benefits and promises contained herein and for good and other valuable consideration, the adequacy and receipt of which is hereby acknowledged, including the expansion of primary employment, the attraction of major investment in the Zone, which contributes to the economic development of Coppell and the enhancement of the tax base in the City, the parties agree as follows: GENERAL PROVISIONS 1. Owner is the lessee or intends to lease the Improvements located on the Land (hereinafter def'med), which Land is located within the City and the Zone; and intends to locate and maintain Tangible Personal Property in the Improvements. 2. The Premises are not in an improvement project financed by tax increment bonds. 3. This Agreement is entered into subject to the rights of the holders of outstanding bonds of the City. 4. The Premises are not owned or leased by any member of the Coppell City Council or any member of the Coppell Planning and Zoning Commission, or any member of the governing body of any taxing units joining in or adopting this Agreement. TAX ABATEMENT AUTHORIZED 5. This Agreement is authorized by the Tax Code and in accordance with the Tax Abatement Guidelines, and approved by resolution of the City Council of the City authorizing the execution of this Agreement. 6. Subject to the terms and conditions of this Agreement, and provided the Taxable Value (hereinafter defined) of the Tangible Personal Property is at least Five Million Five Hundred Thousand Dollars ($5,500,000) as of the First Year of Abatement and as of January 1 of each calendar year thereafter that this Agreement is in effect, the City hereby grants Owner an abatement of seventy-five percent (75%) of the Taxable Value of the Tangible Personal Property for a period of five (5) consecutive years. The actual percentage of the Taxable Value of the Tangible Personal TAX ABATEMENT AGREEMENT - Page 2 zoo: O 35 03733 52360 Property subject to abatement will apply only to the tangible personal property, (excluding inventory and supplies) located on the Premises. The actual percentage of the Taxable Value subject to abatement does not apply to tangible personal property, inventory and supplies that were located on the Premises at any time before January 1, 2002, the period covered by this Agreement. 7. The period of tax abatement herein authorized shall be for a period of five (5) years. The term of this Agreement shall begin on the last date of execution hereof ("Effective Date") and continue until December 31 of the fifth (5th) year following the First Year of Abatement, unless sooner terminated as provided herein. 8. During the period of tax abatement herein authorized, Owner shall be subject to all City taxation not abated, including but not limited to, sales tax and ad valorem taxation on land, inventory and supplies. DEFINITIONS 9. Wherever used in this Agreement, the following terms shall have the meanings ascribed to them: (2002). "Base Year" shall mean the year in which this Agreement is executed B. "Event of Bankruptcy or Insolvency" shall mean the dissolution or termination of a party's existence as a going business, insolvency, appointment of receiver for any part of a party's property and such appointment is not terminated within ninety (90) days after such appointment is initially made, any general assignment for the benefit of creditors, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against a party and such proceeding is not dismissed within ninety (90) days after the filing thereof. C. "First Year of Abatement" shall mean January 1 of the calendar year immediately following the issuance of the final certificate of occupancy for Owner's occupancy of the Improvements. D. "Force Majeure" shall mean any contingency or cause beyond the reasonable control of Owner including, without limitation, acts of God or the public enemy, war, riot, civil conm~otion, insurrection, adverse weather, government or de facto governmental action (unless caused by acts or omissions of Owner), fires, explosions or floods, strikes, slowdowns or work stoppages. E. "Improvements" shall mean approximately 50,000 square feet of office space in the Gateway Corporate Center located at 555 Dividend Drive, Coppell, Texas, located on the Land and as further described herein. F. "Land" shall mean the real property described in Exhibit "A" attached hereto and incorporated herein for all purposes. TAX ABATEMENT AGREEMENT - Page 3 52360 2oo 035 0373h G. "Premises" shall collectively mean the Land and Improvements but excluding the Tangible Personal Property. H. "Taxable Value" means the appraised value as certified by the Appraisal District as of January 1 of a given year. I. "Tangible Personal Property" shall mean tangible personal property, equipment and fixtures, excluding inventory and supplies, owned or leased by Owner that is located on the Premises. Tangible Personal Property does not include any tangible personal property that was located on the Premises at any time before January 1, 2002, the period covered by this Agreement. IMPROVEMENTS 10. Owner has leased or intends to lease approximately 50,000 square feet of office and warehouse space in the Gateway Corporate Center located at 555 Dividend Drive, Coppell, Texas (the "Improvements") for a period of at least five (5) years beginning the First Year of Abatement. Owner agrees to locate and maintain Tangible Personal Property at the Improvements with a Taxable Value of at least Five Million Five Hundred Thousand Dollars ($5,500,000) as of the First Year of Abatement and as of January 1, of each calendar year thereafter that this Agreement is in effect. Nothing in this Agreement shall obligate Owner to lease the Improvements on the Land, or to locate Tangible Personal Property at the Improvements, but said actions are conditions precedent to tax abatement pursuant to this Agreement. OCCUPANCY OF IMPROVEMENTS 11. As a condition precedent to the initiation of tax abatement pursuant to this Agreement, Owner will diligently and faithfully, in good and workmanlike manner, and pursue the occupancy of the Improvements on or before December 31, 2002, as good and valuable consideration for this Agreement, provided, that Owner shall have such additional time to occupy the Improvements as may be required in the event of "Force Majeure," if Owner is diligently and faithfully pursuing occupy of the Improvements. 12. Owner agrees to maintain the Improvements during the term of this Agreement in accordance with all applicable state and local laws, codes, and regulations. Owner agrees that the Improvements shall be used only as an office/loan servicing facility for a period of five (5) years commencing on the First Year of Abatement. 13. The City, its agents and employees shall have the right of access to the Improvements during the term of this Agreement to inspect the Improvements at reasonable times and with reasonable notice to Owner, and in accordance with Owner's visitor access and security policies, in order to insure that the Improvements are being used in accordance with this Agreement and all applicable state and local laws and regulations (or valid waiver thereof). TAX ABATEMENT AGREEMENT - Page 4 03735 52360 GENERAL REQUIREMENTS 14 Owner shall, prior to May 31 of each calendar year that this Agreement is in effect, certify to the City that it is in compliance with each term of the Agreement. 15. Owner agrees that during the term of this Agreement that the Improvements shall be used in the manner (i) that is consistent with the City's Comprehensive Zoning Ordinance, as amended, and (ii) that, during the period taxes are abated hereunder, is consistent with the general purposes of encouraging development or redevelopment within the Zone. 16. Owner agrees to continuously lease and occupy at least 50,000 square feet of space in the Improvements for a period of five (5) years commencing the First Year of Abatement. During the term of this Agreement, Owner agrees, commencing on the date a certificate of occupancy is issued for Owner's occupancy of the Improvements and continuing thereafter until termination of this Agreement, to continuously operate thereon Washington Mutual's National Operations Center that will process and collect payments, perform asset management and provide related commercial loan services in connection with a portfolio of commercial mortgage loans owned by Washington Mutual and serviced for others. Owner agrees during the term of this Agreement to maintain continuous membership in the Coppell Chamber of Commerce. DEFAULT: RECAPTURE OF TAX REVENUE 17. In the event Owner: (i) fails to occupy the Improvements in accordance with this Agreement or in accordance with applicable State or local laws, codes or regulations; (ii) has delinquent ad valorem or sales taxes owed to the City (provided such party retains its right to timely and properly protest such taxes or assessment); (iii) has an "Event of Bankruptcy or Insolvency"; or (iv) breaches any of the terms and conditions of this Agreement, then such Owner, after the expiration of the notice and cure periods described below, shall be in default of this Agreement. As liquidated damages in the event of such default, the Owner shall, within thirty (30) days after demand, pay to the City all taxes which otherwise would have been paid to the City without benefit of a tax abatement with interest at the statutory rate for delinquent taxes as determined by Section 33.01 of the Tax Code as amended but without penalty. The parties acknowledge that actual damages in the event of default termination would be speculative and difficult to determine. The parties further agree that any abated tax, including interest as a result of this Agreement, shall be recoverable against the Owner, its successors and assigns and shall constitute a tax lien on the Tangible Personal Property and shall become due, owing and shall be paid to the City within thirty (30) days after termination. 18. Upon breach by Owner of any obligations under this Agreement, the City shall notify Owner in writing, who shall have thirty (30) days from receipt of the notice in which to cure any such default. If the default cannot reasonably be cured within a thirty (30) day period, and Owner has diligently pursued such remedies as shall be reasonably necessary to cure such default, then the City may extend the period in which the violation must be cured. TAX ABATEMENT AGREEMENT - Page 5 zoo3035 03736 52360 19. If Owner fails to cure the default within the time provided as specified above or, as such time period may be extended, then the City at its sole option shall have the right to terminate this Agreement by written notice to Owner. 20. Upon termination of this Agreement by City, all tax abated as a result of this Agreement shall become a debt to the City as liquidated damages, and shall become due and payable not later than thirty (30) days after a notice of termination is made. The City shall have all remedies for the collection of the abated tax provided generally in the Tax Code for the collection of delinquent property tax. The City at its sole discretion has the option to provide a repayment schedule. The computation of the abated tax for the purposes of the Agreement shall be based upon the full Taxable Value of the Tangible Personal Property without tax abatement for the years in which tax abatement hereunder was received by Owner with respect to the Tangible Personal Property as determined by the Appraisal District, multiplied by the tax rate of the years in question, as calculated by the City Tax Assessor-Collector. The liquidated damages shall incur penalties as provided for delinquent taxes and shall commence to accrue after expiration of the thirty (30) day payment period. ANNUAL APPLICATION FOR TAX EXEMPTION 21. It shall be the responsibility of Owner pursuant to the Tax Code to file an annual exemption application form with the Chief Appraiser for each Appraisal District in which the eligible taxable property has situs. A copy of the exemption application shall be submitted to the City upon request. SUCCESSORS AND ASSIGNS 22. This Agreement shall be binding on and inure to the benefit of the parties to it and their respective heirs, executors, administrators, legal representatives, successors, and assigns. This Agreement may not be assigned without the consent of the City Manager, except that this Agreement may be assigned upon ten (10) days prior notice to City by Owner to any related corporation or other legal entity which controls Owner, is controlled by Owner, or successor entity into which or with which Owner is merged or consolidated or which acquires substantially all of Owner's assets in property, provided that such successor entity of Owner assumes the obligations of the Owner. For purposes of this section "control" shall mean ownership of not less than fifty percent (50%) of all voting stock or legal and equitable interest in such corporation or entity. After any permitted assignment, all references to Owner herein shall thereafter be a reference to Owner's successor with respect to any obligations or liabilities occurring or arising after the date of such assignment. NOTICE 23. All notices required by this Agreement shall be addressed to the following, or other such other party or address as either party designates in writing, by certified mail, postage prepaid, or by hand or overnight delivery: TAX ABATEMENT AGREEMENT - Page 6 zoo3035 03737 52360 If intended for Owner, to: Attn: Corporate Property Services Manager Washington Mutual Bank, FA 1111 Third Avenue Suite 2900 Seattle, Washington 98101 If intended for City, to: Attn: City Manager City of Coppell, Texas P. O. Box 478 Coppell, Texas 75019 With copy to: Peter G. Smith Nichols, Jackson, Dillard, Hager & Smith, L.L.P. 1800 Lincoln Plaza 500 N. Akard Dallas, Texas 75201 CITY COUNCIL AUTHORIZATION 24. This Agreement was authorized by resolution of the City Council approved by its Council meeting authorizing the Mayor to execute this Agreement on behalf of the City. SEVERABILITY 25. In the event any section, subsection, paragraph, sentence, phrase or word herein is held invalid, illegal or unconstitutional, the balance of this Agreement shall stand, shall be enforceable and shall be read as if the parties intended at all times to delete said invalid section, subsection, paragraph, sentence, phrase or word. APPLICABLE LAW 26. This Agreement shall be construed under the laws of the State of Texas. Venue for any action under this Agreement shall be the State District Court of Dallas County, Texas. This Agreement is performable in Dallas County, Texas. COUNTERPARTS 27. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original and constitute one and the same instrument. TAX ABATEMENT AGREEMENT ~ Page 7 zoo30 35 03738 52360 ENTIRE AGREEMENT 28. This Agreement embodies the complete agreement of the parties hereto, superseding all oral or written previous and contemporary agreements between the parties and relating to the matters in this Agreement, and except as otherwise provided herein cannot be modified without written agreement of the parties to be attached to and made a part of this Agreement. RECORDATION OF AGREEMENT 29. A certified copy of this Agreement shall be recorded in the Deed Records of Dallas County, Texas. INCORPORATION OF RECITALS 30. The determinations recited and declared in the preambles to this Agreement are hereby incorporated herein as part of this Agreement. EXHIBITS 31. All exhibits to this Agreement are incorporated herein by reference for all purposes wherever reference is made to the same. 32. This Agreement and the tax abatement provided herein is expressly subject to Owner entering into a lease of the Improvements prior to December 31, 2002. FUTURE EXPANSION 33. The City agrees by separate tax abatement agreement to grant Owner a tax abatement for a period of five (5) consecutive years of seventy-five percent (75%) of the Taxable Value of tangible personal property, other than inventory and supplies, to be located in the Owner's contemplated future expansion consisting of the lease and occupancy of at least an additional 25,000 square feet of office space on the Premises or on land adjacent to the Premises (the "Expansion") and to grant the then owner of the land and improvements comprising the Expansion an abatement for a period of five (5) consecutive years of Seventy-Five percent (75%) of the Taxable Value of the improvements comprising the Expansion, provided: (i) Owner is not then in default or breach of this Agreement; (ii) a certificate of occupancy for Owner's Expansion occurs on before October 1, 2006; and (ii) the combined Taxable Value of the improvements and the tangible personal property, other than inventory and supplies comprising the Expansion, is at least $5.5 Million Dollars. TAX ABATEMENT AGREEMENT - Page 8 03739 52360 EXECUTED in duplicate originals this the/7 ~J~day t~~ . ROBERT E~ ,2002. By: CAa~Y SI~EE~"7'MAYOR ATTEST: By.~~~~~~/._~ LIBBY BA(L~ CITY SECRETARY .3ER, CITY ATTORNEY EXECUTED in duplicate originals this the/g _~ay of~, 2002. WASHINGTON MUTUAL BANK, FA Title: Senior Vice President TAX ABATEMENT AGREEMENT - Page 9 ~oo:~035 037~.0 52360 CITY'S ACKNOWLEDGMENT STATE OF TEXAS § COUNTY OF DALLAS § This instrument was acknowledged before me on the 2002, by Candy Sheehan, Mayor of the City o£ Copp¢ll, Texas, a Texas municipality, on behal£ of said municipality. My Commission Expires: TAX ABATEMENT AGREEMENT - Page 10 zoo30 35 037 1 52360 OWNER'S ACKNOWLEDGMENT STATEOF~.)~.~,~; ,~,~;I,,, ,~ § o, § COUNTY OF ~ q ~ This~nst~ment was ac~owledged before me on the /~ ~ day of~, 2002, by ~f~ ~. ~ ;~/ being the~/~ ~,'~ ~~ of Washington Mutual BanfFS, ~ bdhalf o~d co~oration. ' My Commission Expires: / - ~;7~Notary Publi~, it'ate of~ TAX ABATEMENT AGREEMENT - Page 11 zoo3O 35 03742 52360 EXHIBIT "A" LEGAL DESCRIPTION OF LAND Whereas, Catellus Development Corporation is the sole owner of a 7.31 acre tract of land in the Cordelia Bowen Survey, Abstract No. 56, Dallas County, Texas, and being all of Lot 2, Block C, Gateway Business Park No. II, an addition to the City of Coppell, as recorded in Volume 99104, page 00106 of the Plat Records of Dallas County, Texas. oo38 35 037L 3 S C 0 FEB ~0 CObNTY CLERK. D~ll~s County. CITY OF COPPELL 255 PARKWAY BLVO P 0 BOX 478 . COPPELL, TX 75019 ....