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RE 11-10-98.3 A RESOLUTION OF THE CITY OF COPPELL, TEXAS RESOLUTION NO. 111098.3 A RESOLUTION OF THE CITY OF COPPELL, TEXAS, APPROVING THE TERMS AND CONDITIONS OF A TAX ABATEMENT AGREEMENT BY AND BETWEEN THE CITY OF COPPELL, TEXAS AND PRIMERA COPPELL PROPERTIES III, LTD.; AUTHORIZING ITS EXECUTION BY THE MAYOR; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City Council has been presented a proposed Tax Abatement Agreement by and between the City of Coppell, Texas and Primera Coppell Properties III, Ltd., a copy of which is attached hereto and incorporated herein by reference; and WHEREAS, upon full review and consideration of the Agreement, and all matters related thereto, the City Council is of the opinion and finds that the terms and conditions thereof should be approved, and that the Mayor should be authorized to execute the Agreement on behalf of the City of Coppell, Texas; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE ~ OF COPPEI,L, TEXAS, THAT: SECTION 1. The Agreement attached hereto having been reviewed by the City Council of the City of Coppell, Texas, and found to be acceptable and in the best interest of the City and its tiffins, be, and the same is hereby, in all things approved, and the Mayor is hereby authorized to execute the Agreement on behalf of the City of Coppell, Texas. SECTION 2. The City Council finds that the improvements proposed to be built upon the Premises described in the Agreement will enhance the economic vitality of the community through a combination of new capital investment, increased sales tax revenues, and the creation of additional job opportunities. SECTION 3. The tax abatement to be granted by the Agreement will not include inventory, and supplies. 1 SS17356 SECTION 4. The improvements proposed for the Premises will accomplish the tax abatement guidelines of the City of Coppell, Texas. 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 affmnative 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 fi.om and after its passage. DULY RESOLVED ANO Al)OPTED by the City Council of the City of Coppell, Texas, on this the /DT~/~ dayof /~tJ¢'~/~r-, 1998. c'xho g , M YOR ATI'EST: KATHI.F.F:N ROACH, CITY SECRETARY APPROVED AS TO FORM: G. surrH/c'ri ATrO ,m¥ (PGStt~ ~0/~8) 2 ss17356 12/30/98 13~9964 $31. STATE OF TEXAS § Deed § TAX ABATEMENT AGREEMENT COUNTY OF DAI,I,AS § This Tax Abatement Agreement (the "AGREEMENT") is entered into by and between the City of Coppell, Texas (the "CITY'), a home role city and municipal corporation of Dallas County, Texas, duly acting herein by and through its Mayor, and Primera Coppell Properties rll, Ltd. C'PRIMERA lit'), acting by and through ks authorized officer. WITNESSETH: WHE~REAS, the City Council of the City of Coppelt, Texas, (the "CITY"), passed an Ordinance (the "ORDINANCE") establishing Tax Abatement Reinvestment Zone No. 19 (the "ZONE"), for commercialfmdustrial tax abatement, as authorized by the Property Redevelopment and Tax Abatement Act, Chapter 3 12 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 WHF~REAS, the CITY has adopted a resolution stating that it elects to be eligible to participate in tax abatement; and Wi~S, 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 GUIDEI,INES and the TAX CODE; and WHF~REAS, PRIMERA Hl's development efforts described herein will create permanent new jobs in the CTI~; and WHEREAS, the City Council fin& that the contemplated use of the PREMISES (hereinaRer defined), the contemplated improvements to the PREMISES thereto in the amount set forth in this AGREEMENT, and the other tenus 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 ss~735s 98252 06732 WItEREAS, the City Council finds that the improvements sought are feasible and practicable and would be of benefit to the PREMISES (hereina~er 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 PRIMERA Ill. the proposed owner of the PREMISES within the Tax Abatement Reinvestment Zone No. 19 for the abatement of taxes pursuant to Chapter 312 of 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 Coppea and the enhancement of the tax base in the CITY, the parties agree as follows: GENERAL PROVISIONS 1. PRIMERA Ill is the owner or is under contract to purchase the real property described in Exlu~it "A" attached hereto and made a part hereof for all purposes (the "PREMISES" hereinaRer defined), which real property is located within the city limits of the CITY and within the 2. The PREMISES are not in an improvement project financed by tax increment bonds. 3. This AGREEMENT is entered into subject to the fights 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 AGREEI~.~[ENT. TAX ABATEMENT AUTHORIZED 5. This AGREEMENT is authorized by the TAX CODE and in accordance with the City Tax Abatement Guidelines and Criteria, 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 that the combined TAXABI ,E VALUE for the PREMISES and TANGIBLE PERSONAL PROPERTY is at least Five Million Five Hundred Thousand Dollars ($5,500,000) as of January 1 of the FIRST Tax Abatement Agreement - Page 2 8817358 98252 06733 YEAR OF ABATEMENT and as of January 1 of each year thereafter for a period of four (4) years, the CITY hereby grants PRIMERA HI an abatement of seventy-five percent (75%) of the TAXABI,E VALUE of the PREMISES and the TANGIBI,E PERSONAL PROPERTY located on the PREMISES for a period of five (5) years. The actual percentage of taxes subject to abatement for each year of this AGREEMENT will apply only to the portion of the taxable value of the PREMISES that exceeds the BASE YEAR TAXABLE VALUE for the PREMISES, the year in which this AGREEMENT is executed (base year/1998). The tax abatement agreement for TANGIBI,E PERSONAL PROPERTY will only apply to the TANGIBLE PERSONAL PROPERTY added to the PREMISES after this AGREEMENT is executed. 7. The period of tax abatement herein authorized shall be for a period of five (5) years. 8. During the period of tax abatement herein authorized, PRIMERA HI shall be subject to all CITY taxation not abated, including but not limited to, sales tax and ad valorera taxation on land, inventory and supplies. DEFINITIONS 9. Wherever used in this AGREEMENT, the following terms shall have the meanings ascribed to them: A. The PREMISES shall mean the real property described in Exhibit "A' attached hereto and incorporated herein for all purposes including any IMPROVEMENTS and TANGIBLE PERSONAL PROPERTY, excluding inventory, which is added thereto subsequent to the execution of this AGREEMENT; B. The IMPROVEMENTS shall mean the contemplated improvements to be constructed on the PREMISES and as further described herein. C. TAXABI,F. VALUE means the appraised value as certified by the Appraisal District as of January 1 of a given year. D. The BASE YEAR TAXABI,E VALUE shall mean the total assessed taxable value for the PREMISES for the year in which the Tax Abatement Agreement is executed (1998). E. The FIRST YEAR OF THE TAX ABATEMENT AGREEMENT shall mean January 1 of the calendar year immediately following the issuance of a certificate of occupancy for the IMPROVEMENTS. F. TANGIBLE PERSONAL PROPERTY shall mean tangible personal property, equipment and fixtures other than inventory or supplies added to the PREMISES subsequent to the execution of this AGREEMENT. Tax Abatement Agreement - Page 3 ss17358 98252 0673L G. An EVENT OF BANKRUPTCY OR INSOLVENCY shall mean the dissolution or termination of PRIMERA lll's existence as a going business, insolvency, appointment of receiver for any part of PRIMERA lIPs properly and such appointment is not terminated within thirty (30) 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 PRIMERA I!I and such proceeding is not dismissed within thirty (30) days after the filing thereof. IMPROVEMENTS 10. PRIMERA Ill owns or is under contract to purchase the real property described in Exhibit "A" and agrees to construct or cause to be constructed thereon an officedwarehouseJdistdbution facility of approximately 3 10,000 square feet (and other ancillary facilities such as reasonably required parking and landscaping more fully described in the submittals fled by PRIMERA lIl with the CrrY from lime to lime in order to obtain a building permit) known as Northpoint Business Center, (the "IMPROVEMENTS"). The cost of the IMPROVEMENTS shall be at least Six 1VEallion Six Hundred Eight Thousand Dollars ($6,680,000). Nothing in this AGREEMENT shall obligate PRIMERA Ill to construct the IMPROVEMENTS and/or to locate TANGIBLE PERSONAL PROPERTY on the PREMISES, but said actions are a condition precedent to tax abatement pursuant to this AGREEMENT. CONSTRUCTION OF IMPROVEMENTS 11. As a condition precedent to the initiation of tax abatement pursuant to this AGREEMENT, PRIMERA 111 will diligently and faithfully, in good and workmanlike manner, pursue the completion of the contemplated IMPROVEMENTS on or before December 31, 1998, as good and valuable consideration for this AGREEMENT, and that all construction of the IMPROVEMENTS will be in accordance with all applicable state and local laws, codes, and regulations, (or valid waiver thereof); provided, that PRIMERA lIl shall have such additional time to complete and maintain the IMPROVEMENTS as may be required in the event of'~orce Majeure," if PRIMERA !11 is diligently and faithfully pursuing completion of the IMPROVEMENTS. For this purpose, '~orce Majeure" shall mean any contingency or cause beyond the reasonable control of PRIMERA 111 including without limitation, acts of God or the public enemy, war, riot, civil commotion, insurrection, adverse weather, government or de facto governmental action (unless caused by acts or omissions of PRIMERA BI), fires, explosions or floods, strikes, slowdowns or work stoppages. 12. PRIMERA III agrees to maintain the IMPROVEMENTS during the term of this AGREEMENT in accordance with all applicable state and local laws, codes, and regulations. PRIMERA 111 agrees that the IMPROVEMENTS shall be used only as an office/warehouseJdistn~ution facility for a period of five (5) years commencing on the date a certificate of occupancy is issued for the IMPROVEMENTS. Tax Abatement Agreement - Page 4 ss17358 88252 ' 6735 13. The CITY, its agents and employees shall have the right of access to the PREMISES during construction to inspect the IMPROVEMENTS at reasonable times and with reasonable notice to PRIMERA IH~ and in accordance with PRIMERA H]'s visitor access and security policies, in order to insure that the construction of the IMPROVEMENTS are in accordance with this AGREEMENT and all applicable state and local laws and regulations (or valid waiver thereof). GENERAL REQUIREMENTS 14. Construction plans for the IMPROVEMENTS constructed on the PREMISES will be filed with the CITY, which shall be deemed to be incorporated by reference herein and made a part hereof for all purposes. 15. After completion of the IMPROVEMENTS, PRIMERA 1H shall certify in writing to the CITY the construction cost of the IMPROVEMENTS. PRIMERA Ill shah also annually certify to the CITY that it is in compliance with each term of the AGREEMENT. 16. The PREMISES and the IMPROVEMENTS constructed thereon at all times 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. 17. PRIMERA IH agrees to provide to the tenants of the PREMISES, the benefit of the abatement of real property taxes granted herein. PRIMERA HI shall, upon written request, provide the CITY with satisfactory evidence that the benefits of this AGREEMENT have been provided to the tenants of the PREMISES. DEFAULT: RECAPTURE OF TAX REVENUE 18. In the event PRIMERA HI fails in performance ofany ofthe following conditions: (i) completion of the IMPROVEMENTS in accordance with this AGREEMENT or in accordance with applicable State or local laws, codes or regulations; (ii) have any delinquent ad valorem or State sales taxes owed to the CITY with respect to the PREMISES and/or TANGIBLE PERSONAL PROPERTY (provided PRIMERA HI retains its fight to timely and properly protest such taxes or assessment); ('tii) upon the occurrence of any "Event of Bankruptcy or Insolvency"; or (iv) breaches any of the terms and conditions of this AGREEMENT, then PRIMERA Ill, aRer 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, PRIMERA HI shall, within thirty (30) days a~er 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 property tax revenue lost, including interest as a result of this AGREEMENT, shall be recoverable against PRIMERA Ill, its successors and assigns and shall Tax Abatement Agreement - Page 5 ss17358 98252 06736 constitute a tax lien on the PREMISES and the TANGIBLE PERSONAL PROPERTY and shall become due, owing and shall be paid to the CITY within thirty (30) days after termination. 19. Upon breach by PRIMERA I!1 of any obligations under this AGREEMENT, the CITY shall notify PRIMERA HI in writing. PRIMERA HI shall have thirty (30) days from receipt of the notice in which to cure any such default. ff the default cannot reasonably be cured within a thirty (30) day period, and PRIMERA HI 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 20. If PRIMERA HI fails to cure the default within the time provided as spedfled 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 PRIMERA HI. 21. Upon termination of this AGREEMENT by CTI'Y, all tax revenue 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 oftemination is made. The CITY shall have all remedies for the collection of the recaptured tax revenues 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 tax revenue abated for the purposes of the AGREEMENT shall be based upon the full TAXABLE VALUE without tax abatement for the years in which tax abatemere hereunder was received by PRIMERA HI with respect to the PREMISES and 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 EXEMFFION; RENDITION 22. It shall be the respons~ility ofPR1MERA lIl, 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 sims. A copy of the exemption application shall be submitted to the CITY. 23. PRIMERA Ill shall annually render the values of the PREMISES and the TANGIBLE PERSONAL PROPERTY to the Appraisal District and provide a copy of the same to the CITY. SUCCESSORS AND ASSIGNS 24. 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 be assigned with the consent of the CITY. After any permitted assignment, all Tax Abatement Agreement - Page 6 SS17358 98252 O6737 references to PRIMERA HI herein shall thereafter be a reference to PRINIERA HI's successor with respect to any obligations or liabilities occurring or arising after the date of such assignment. NOTICE 25. 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 delivery: flintended for PRIMERA ill, to: Ralph Heins, President Primera Coppell Properties IIL Ltd. 5454 Fountain Place 1445 Ross Avenue Dallas, Texas 75201 flintended for CTFY, to: City of Coppell, Texas city _anager P. O. Box 478 Copp~ll, Texas 75019 CITY COUNCIL AUTHOItrzATION 26. 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. TAXPAYER AUTHOREATION 27. This AGREEMENT was authorized by the Board of Directors of PRIMERA HI authorizing the undersigned to execute this AGREEMENT on behalf of PRB4ERA SEVERABH ,1TY 28. 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. Tax Abatement Agreement - Page 7 ss~735s 98252 06738 APPLICABLE LAW 29. 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 perfonnable in Dallas County, Texas. 30. 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. ENTIRE AGREEMENT 31. This AGREEMENT embodies the complete agreement of the parties hereto, superseding all oral or written previous and comemporary 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. 32. The provisions of this AGREEMENT are hereby declared covenants running with the PREMISES and are fully binding on all successors, heirs, and assigns of PRIMERA III who acquire any right, rifle, or interest in or to the property, or any part thereof. Any person who acquires any right, title, or interest in or to the property, or any part hereof; thereby agrees and covenants to abide by and fully perform the provisions of this AGREEMENT with respect to the right, title or interest in such property. RECORDATION OF AGREEMENT 33. A certified copy of this AGREEMENT shall be recorded in the Deed Records of Dallas County, Texas. INCORPORATION OF RECITALS 34. The determinations recited and declared in the preambles to this AGREEMENT are hereby incorporated herein as part of this AGREEI~,!ENT. EXHIBITS 35. All exhibits to this AGREEMENT are incorporated herein by reference for all purposes wherever reference is made to the same. Tax Abatement Agreement - Page 8 8817358 98252 i6739 ., CONSTRUCTION 36. Both parties have participated in the negotiation and preparation of this AGREEMENT. This AGREEMENT shall not be constructed more or less strongly against either party. PR1MERA llI acknowledges that it has obtained legal counsel to assist in the preparation of this AGREEMENT and that PRIMERA Ill has fully satisfied itself; without warranty or representation not expressly contained herein, by CITY that the tax abatement contemplated hereby is available in all respects. EXECUTED in duplicate originals this the/t~/7 day of/L)cDd, , 1998. ATTEST: : CAND /L~,!~:MAyOi KATHLEEN ROACH, CITY SECRETARY AGREED AS TO FORM: PETER G. SMITH, CITY ATTORNEY EXECUTED in duplicate originals this the 4' day of 19U4 ,1998. PRIMERA COPPELL PROPERTIES Ill, LTD. By: Primera Consolidate, LLC, its general partner By: :, ,: RALPH HEINS, MANAGER Tax Abatement Agreement - Page 9 ss~735s 98252 06740 CITY'S ACKNOWLEDGMENT STATE OF TEXAS § COUNTY OF DAI,I,AS § by Candy Sheehan, Mayor of the City of Coppell, Texas, a Texas municipality, on behalf of said munidpality. ~... '-...%.:...." Tax Abatement Agreement - Page 10 ss1735s 98252 067L 1 PRIMERA I!I'S ACKNOWLEDGMENT STATE OF TEXAS § COUNTY OF DALLAS § This instrument was acknowledged before me on the ~.~'~' day of (C~)(~ ~ , 19~ by Ralph Heins being the Manager of Primera Consolidate, LLC, the general partner of Primera Coppell Prope~ies HI, Ltd., a Texas limited partnership, on behalf of said corporation. My Commission expires: Tax Abatement Agreement - Page 11 ss17358 98252 06742 LEGAL DESCRIPTION OF PROPERTY Being a trace or parcel of land situated in the C.S. Dunnagan Survey. Abstract No. 1655 and the Jesse Moore Survey', Abstract No. 968, City of Coppeil, Dallas County, Texas., same bej.r;g a portion of "Freeport North" a Prelia~inary-Final Plat recorded in Volume 84203,. Page 1835, Dallas County Plat Records, same also being a portion of that c'ertain tract conveyed to 'r/E Northpoint Partners, LTD. By instrument of record in Volume 96106, Page 5182, Deed Records Dallas County, Dallas County Texas, and being more particularly described as follows: BEGI~NiNG at the south end of a cut-back line at the intersection of the west ROW line of Royal 'l.~ne (100' ROW) with the north line of Northpoinr~ Drive (80~ ROW}, a 1/2" iron rod found for co;rx~er; THENCE South 89 degrees 50 minutes 31 seconds ~est. along said north ROW line, a distance of 1,312.80 feet to the ~outhwest corner of said T/E Northpoint tract, same being on the east line of the Greenway-Grapevine/Coppeli Paztners L.P. trace as recorded in. Volume 96097, Page 3964 of said Deed Records, a 1/2" iron rod found for corner; THENCE North 00 degrees 34 minutes 37 secor..ds West, along the coma,~on line bet~.~Teen said i'/E Northpoinlc and Greenway tracts, a distance of 516.00 feet to 1/2': iron ~od set for corner; THENCE departing said co'~nmon line, .~jorth 89 degrees 50 minutes .~i seconds East, a distance of 1428.97 feet to a point on the west ROW line of sai~ Royal Lane, a 1/2" iron rod se~n for corner; THENCE South O0 degrees 09 mintues 29 seconds East, along said ~.~est P. OW line a distance of 97.07 feet to the beginning of a curve to the right, said cu.rve having a radius of 950.00' and a central angle of 25'degrees 15 minutes seconds, a 1./2" iron rod found for corner; THENCE along said cu~e and contin;%ing along said west ROW line; an arc distance of 418.86 feet to the north end of said cut-b~_ck line, a 1/2" iron rod found for corner; TI{ENCE SOuth 57 degrees 44 minutes 47 seconds West, along sa~d. cut back line distance of 25.43 feet to the POINT OF BEGINNING AND containing 722.565 sq. Ft. or 16.588 acres, more or less within these metes and bounds. 9825?-067b, 3 hhL90 g&g86 "'- ~t ~ause of c~or or '~cp is invalid ane COU~ OF DALLAS this in~ ~ filed Qn the ~ate ~n~ time >~.~ ~ ~ ~d g~s uuq ,ec~r~ in 'the volume and nEC.~ ~ COl~ Ct Daills Goun~, T~I