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RE 2003-12-09.24942619 31,4.0850 $35.00 Deed RESOLUTION NO. ~ 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 SOMERA COMMUNICATIONS SALES, INC.; 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 Somera Communications Sales, Inc., 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 f'mds 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 CITY OF COPPELL, 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 citizens, 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. SECTION 4. The improvements proposed for the Premises will accomplish the tax abatement guidelines of the City of Coppell, Texas. 60981 , !22q 12293 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. Tiffs Resolution shall become effective immediately fxom and after its passage. DULY RESOLVED AND ADOPTED by the City Council of the City of Coppell, Texas, on this the ~ day o f~l~~a~ 003. ROBERT E. HAGE~c'~ITY ATTORNEY (PGS/scs 12/02/03) ATTEST: LIBBY'BALL(~Y'S~-CRETARY 60981 2 , m 22t 1229t/ 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 Somera Communications Sales, Inc. ("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. 38 (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 259,000 square feet of office/warehouse space in AmberPoint Phase One, located at 301 Northpoint Drive, Coppell, Texas (hereinafter defmed as the "Improvements") and intends to locate Tangible Personal Property (hereinafter defmed) as the Improvements; and WHEREAS, the City and AmberPoint at Coppell, L.L.C. ("AmberPoint") previously entered into that certain Tax Abatement Agreement for the Improvements; and WHEREAS, the development efforts described herein will create and/or have created permanent new jobs in the City; and WHEREAS, the City Council fmds 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 SOMERA COMMUNICATIONS SALES, 1NC. TAX ABATEMENT AGREEMENT - Page 1 12295 59776 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 Promises 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 CoppeI1 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 real property described in Exhibit "A" attached hereto (the "Land" hereinafter defined), 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, 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 property subject to abatement will apply only to the tangible personal property added to the Premises after this Agreement is executed. SOMERA COMMUNICATIONS SALES, 1NC. TAX ABATEMENT AGREEMENT - Page 2 12296 59776 7. The period of tax abatement herein authorized shall be for a period of five (5) years beginning 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: (2003). "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 conunencement 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, 2004. D. "Fome 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 commotion, insurrection, adverse weather, govermnent 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 construction 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. 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. SOMERA COMMUNICATIONS SALES, INC. TAX ABATEMENT AGREEMENT - Page 3 m, 22b, 12297 59776 I. "Tangible Personal Property" shall mean tangible personal property, equipment and fixtures other than inventory or supplies owned or leased by Owner that is added to the Premises subsequent to the execution of this Agreement. IMPROVEMENTS 10. Owner has leased or intends to lease from AmberPoint approximately 259,000 square feet of office/warehouse space in AmberPoint Phase One located at 301 Northpoint Drive, Coppell, Texas (the "Improvements") for a period of at least seven (7) years beginning no later than the First Year of Abatement. Owner agrees to locate and maintffm Tangible Personal Property at the Improvements with a Taxable Value of at least One Million Four Hundred Thousand Dollars ($1,400,000) as of the First Year of Abatement and as of January 1 of each calendar year thereafter this Agreement is in effect. Nothing in this Agreement shall obligate Owner to lease the Improvements on the Land, or to locate the 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, 2003, as good and valuable consideration for this Agreement, provided, that Owner shall have such additional tLme to occupy the Improvements as may be required in the event of "Force Majeure," if Owner is diligently and faithfully pursuing occupancy 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/warehouse facility for a period of seven (7) 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). GENERAL REQUIREMENTS 14. Owner shall, prior to May 1 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. SOMERA COMMUNICATIONS SALES, INC. TAX ABATEMENT AGREEMENT - Page 4 12298 59776 16. Owner agrees subject to events of Fome Majeure and Casualty to continuously lease and occupy the Improvements for a period of seven (7) years commencing no later than the First Year of Abatement. 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. 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. SOMERA COMMUNICATIONS SALES, INC.' T,.M~ABATEMENT AGREEMENT - Page 5 59776 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 be assigned with the consent of the City Manager. 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 occun'ing 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: If intended for Owner, to: Attn: Kara Boling Somera Communications Sales, Inc. 5383 Hollister Avenue Santa Barbara, CA 93111 If intended for City, to: Arm: 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 SOMERA COMMUNICATIONS SALES, INC. TA~. ~BATEMENT AGREEMENT - Page 6 ' m '22q 12300 59776 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 insmmaent. 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. EXItlBITS 31. All exhibits to this Agreement are incorporated herein by reference for all purposes wherever reference is made to the same. SOMERA COMMUNICATIONS SALES. INC.:Tg.,Y ~BATEMENT AGREEMENT - Page 7 59776 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, 2003. EXECUTED in duplicate originals this the ~,~_~ay o(~.~, 2003. By: I~O'I.~LAS N. ] ;lhbVER, MAYOR ATTEST: L/BBY ~,'CI~Y §ECRETARY YATTORNEY EXECUTED in duplicate originals this the i-I day of G,3~v.~,~, 200~. MUNICATIONS SALES, INC. Name: rZL-L-L-L-L-2~ ~_~-~., Title: x/X SOMERA COMMUNICATIONS SALES, INC. TAK,~I?~.TEMIiNT AGREEMENT - Page 8 .m zzq /2302 59776 CITY'S ACKNOWLEDGMENT STATE OF TEXAS § COUNTY OF DALLAS § This instrument was acknowledged be£ore me on the ~day 2003, by Douglas Stover, Mayor of the City of Coppell, Texas, a Texas municipality, on behal£ of said municipality. oO~?.'?,,,to Notary Pub~, ~tate of Texas My Commission Expires: ~%..B2:~.~../. % ~ ..':~¥ .ug.. '-. 6-11- ~- .~ Zk'~' ~-'~. % ..' ..... ~, ,,,~ SOMEP..A COMMUNICATIONS SALES, INC. TAX ABATEMENT AGREEMENT - Page 9 , m~22~. ,12303 59776 OWNER'S ACKNOWLEDGMENT STATE OF CALIFORNIA § COUNTY OF ~.A4~"~ ~'0~§ § This instrument was ac~owledged before m~ on the I~~ day of~fU~ , 200~byT~m~ ~ beingthe ~¢t~ ~[ ' of Sodera Comm~ic~tions S~les, ~c., on behalf of said co~oration. Nota~Public, Sta~e ofCalifo ' My Commission Expires: SOMERA COMMUNICATIONS SALES, INC. TAX ABATEMENT AGREEMENT - Page 10 59776 , ~22~ .I, 230~ £XI-IIBIT ~A'~ LEGAL DESCK[P'HON AIv[BEKPO~ BUSk-NESS PARK AT COPPELL PHASE i EXHIBiT BEh-NG a tract of land out of the Jesse Moore Survey, Abstract No. 968 in the City of Coppell, Dallas County, Texas, and being part of Lot 1, Block A of ne Amberpoint Business Park Addition to the City of Coppell as described in Volume 2002023, Page 00071 (D.R.D.C.T.), and being part of a tract of land described in deed to Baltantyne Sack, L.LC., recorded in Volume 2001173, Page 3803, (D.R.D.C.T.), and being more particularly described as follows: CON~vlENC~'G at a l/2-inch found iron rod with cap st~-n~d Bfittain & Crawford in the centerline of Northpoint Drive (80 foot right-of-way), said point being the northwest comer of a tract of land described in Special Warranty Deed to the Ci~' of Coppell as recorded in Volume 96164, Page 207, D.R.D.C.T., and being in the east line of F~eport North Addition, an addition to the City of Coppell, as recorded in Volume 84203, Page iS35, D.R.D.C.T.; THENCE North 00 degrees 07 minutes 07 seconds East, dong said east line, a distance of 30.00 feet to a point on a non-tangent circular curve to the left, kz','ing a radius of 410.16 feet and whose chord bears North 75 degrees 33 minutes 23 seconds Eva:. a distance of 220.98 feet, said point being on the north fight-of-way line of Northpoint Drive (fO feet wide); THENCE Northeasterly, along said noah fight-of-way line mud along said circular curve to the left, through a central angle of 31 degrees 15 minutes 17 seconis and an arc distance of 223.74 feet to the point of reverse curvature of a circular curve to the rigk:, having a radius of 480.00 feet and wtmse chord bears North 68 degrees 41 minutes 11 secor. Ls East, a distance of 146.16 feet; THENCE Northeasterly, continuing along said north right-of-way line and along said circular cur-,'e to the right, through a central angle of 17 de~ees 30 minx:es 53 seconds and an arc distance of 146.73 feet to the POEN'r OF BEGLN~"[N'G; THENCE North 00 degrees 07 minutes 17 seconds East. ~ong said east line, a distance of 384.27 feet to a 5/8-inch iron rod found for a comer; THENCE North 00 degrees 56 minutes 17 seconds West, ~ong the east line of said Freeport Nor'dq Addition, a distance of 90.42 feet to a l/2-inch iron rod found for a comer; THENCE North 89 degrees 46 minutes 32 seconds West, ~ong the north line of said Freeport North Addition, a distance of 2.29 feet to a l/2-inch iron red found for the southeast comer of Hager Containers addition, an addition to the City of Coppell. as recorded in Volume 88206, Page 3786, D.R.D.C.T.; THENCE North 00 degrees 07 minutes 49 seconds East, a/ong the east line of said Hager Containers Addition, a distance of 326.92 feet, to a point for a comer; =1,2305 TF[ENCE South 89 degrees 56 minutes 24 seconds East, departing said east line, a distance of 842.54 feet, to a point on the west right-of-way-line of said Northpoint Drive (60 feet wide); THENCE South 00 .degrees 03 minutes 37 seconds West, along said west right-of-way line, a distance of 369.74 feet to the point of curvature of a circular curve to the fight, having a radius of 420.00 feet and whose chord bears South 45 degrees 02 minutes 07 seconds West, a distance of 593.71 feet; THENCE Southwesterly, along said northwest right-of-way line and along said circular curve to the fight, through a central angle of 89 de~ees 57 minutes 00 seconds and an arc distance of 659.37 feet to the point of tangency; TffENCE North 89 degrees 59 minutes 23 seconds West, continuing along said north fight-of-way line, a distance of 315.43 feet to the point of curvature of a circular curve to the left, having a radius of 480.00 feet and whese chord bears South 83 degrees 43 minutes 37 seconds West, a distance of 105.07 feet; TI-I~NCE Southwesterly, along said northwest right-of-way line and along said circular curve to the left, through a central angle of 12 degrees 33 minutes 59 seconds and an arc distance of 105.28 feet to the POINT OF BEGh'N~q2qG AND CONTA~N'I~G 626,615 square feet or 14.39 acres of land, more or less. 0q NOV 18 PH 3:0 I ~,~.,~ C~J,~Fy CLERK [~.'~'~ OALLAS CO TEXAS RETURN