RE 2006-0627.4
RESOLUTION NO. 2006-0627.4
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 COPPELL HARD EIGHT, 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 Coppell Hard Eight, 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 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.
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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 ~1.Y~/day of (1'-'-'" -"- , 2006.
ArrEST:
~ '6/.'u~
m Y~~CITY SECRETARY
2
63855
STATE OF TEXAS
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TAX ABATEMENT AGREEMENT
COUNTY OF DALLAS
This Tax Abatement Agreement (the "Agreement") is entered into by and between the City
of Coppell, Texas (the "City"), and Coppell Hard Eight, Ltd ("Owner"), acting by and through their
authorized representatives.
WITNESSETH:
WHEREAS, the City Council of the City of Coppell, Texas, (the "City"), passed an
Ordinance (the "Ordinance") establishing Tax Abatement Reinvestment Zone No. 49 (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 owns or is under contract to purchase the real property described in
Exhibit "A" attached hereto ("Land") and intends to construct certain Improvements (hereinafter
defined) on the Land; and
WHEREAS, Owner's development efforts described herein will create permanent new jobs
in the City; and
WHEREAS, the City Council finds that the contemplated use of the Premises (hereinafter
defined), the contemplated Improvements thereto in the amount set forth in this Agreement, 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
WHEREAS, the City Council finds that the Improvements sought are feasible and
practicable and would be of benefit to the Premises to be included in the Zone and to the City after
expiration of this Agreement; and
Coppell Hard Eight/Tax Abatement Agreement -PAGE 1
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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 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 Coppell and the enhancement of the
tax base in the City, the parties agree as follows:
Article I
Defmitions
Wherever used in this Agreement, the following terms shall have the meanings ascribed to
them:
"Base Year Taxable Value" shall mean the Taxable Value for the Land for the year in
which the Tax Abatement Agreement is executed (2006).
"CEDF" shall mean Coppell Economic Development Foundation.
"CEDF Purchase and Sale Agreement" shall mean that certain purchase and sale
agreement for the Land between the City and the CEDF of approximate even date herewith for
the subsequent transfer ofthe Land to the Owner.
"Commencement of Construction" shall mean that: (i) the plans have been prepared and
all approvals thereof required by applicable governmental authorities have been obtained for
construction of the Improvements; (ii) all necessary permits for the construction of the
Improvements, on the Land pursuant to the respective plans therefore having been issued by all
applicable governmental authorities; and (iii) grading of the Land or the construction of the
vertical elements of the Improvements has commenced.
"Completion of Construction" shall mean that: (i) the construction of the Improvements,
on the Land has been substantially completed; (ii) the first final, permanent certificate(s) of
occupancy for the occupancy of the Improvements has been issued by the City.
"Coppell Hard Eight Purchase and Sale Agreement" shall mean that certain purchase and
sale agreement for the Land between the Owner and the CEDF of approximate even date
herewith.
Coppell Hard Eight/Tax Abatement Agreement -PAGE 2
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"Economic Development Agreement" shall mean that certain economic development
agreement by and between Owner and the City dated of approximate even date herewith.
"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 such
party, and such proceeding is not dismissed within ninety (90) days after the filing thereof.
"First Year of Abatement" shall mean January 1 of the calendar year immediately
following the date of issuance of the first final certificate of occupancy for the Owner's occupancy
of the Improvements, unless otherwise agreed by the parties.
"Force Majeure" shall mean any contingency or cause beyond the reasonable control of a
party 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 such party), fires, explosions or floods, strikes, slowdowns or work stoppages.
"Improvements" shall mean the contemplated improvements to be constructed on the Land,
and as further described herein, and any additions or expansions constructed on the Land during the
term of this Agreement.
"Land" means the real property described in Exhibit A.
"Note" shall mean that certain promissory note in the principal amount of $1,300,000.00
payable to the lender First Financial Bank, N.A. in Stephenville P.O. Box 998 Stephenville,
Texas 76401 by the Company as borrower with a maturity date of sixty-eight (68) months for the
construction for the Restaurant as set forth in the Guaranty.
"Premises" shall collectively mean the Land and the Improvements following construction
thereof, but excluding Tangible Personal Property.
"Related Agreements" shall collectively mean the Coppell Hard Eight Purchase and Sale
Agreement, the Note and the Economic Development Agreement.
"Tangible Personal Property" shall mean tangible personal property, equipment and
fixtures owned by or leased by Owner, other than inventory or supplies, located on the Premises
subsequent to the execution of this Agreement.
"Taxable Value" means the appraised value as certified by the Appraisal District as of
January I of a given year.
Coppell Hard Eight/Tax Abatement Agreement -PAGE 3
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Article II
General Provisions
2.1 Owner is under contract, to purchase the Land, which Land is located within the city
limits of the City and within the Zone. Owner intends to construct the Improvements on the Land
and to locate Tangible Personal Property (hereinafter defined) on the Premises.
2.2 The Premises are not in an improvement project financed by tax increment bonds.
2.3 This Agreement is entered into subject to the rights of the holders of outstanding
bonds of the City.
2.4 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.
Article III
Tax Abatement Authorized
3.1 This Agreement is authorized by the Tax Code and in accordance with the City Tax
Abatement Guidelines, and approved by resolution of the City Council.
3.2 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 Improvements, and 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 Taxable Value of the Improvements
subject to abatement for each year this Agreement is in effect will apply only to the portion of the
Taxable Value of the Improvements that exceeds the Base Year Taxable Value. The actual
percentage of Taxable Value of the Tangible Personal Property subject to abatement will only apply
to the Tangible Personal Property located on the Premises after this Agreement is executed.
3.3 The period of tax abatement herein authorized shall be for a period of five (5)
consecutive years.
3.4 During the period of tax abatement herein authorized, Owner shall be subject to all
taxation not abated, including but not limited to, sales tax and ad valorem taxation on land,
inventory and supplies.
3.5 The term of this Agreement shall begin on the Effective Date and shall continue
until February 1 of the calendar year following the sixth (6th) anniversary date of the First Year
of Abatement.
Coppell Hard Eight/Tax Abatement Agreement -PAGE 4
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Article IV
Improvements
Owner intends to construct or caused to be constructed on the Land a restaurant containing
approximately 11,000 square feet of space (and other ancillary facilities such as reasonably required
parking and landscaping more fully described in the submittals filed by Owner with the City from
time to time in order to obtain a building permit) ("Improvements"). Owner intends to locate
Tangible Personal Property on the Premises. Nothing in this Agreement shall obligate Owner to
construct the Improvements, including an unscreened outdoor open-pit barbecue similar to the
unscreened open-pit barbecue located at the Owner's restaurant in Stephenville, Texas, on the Land
or to locate Tangible Personal Property on the Premises but said actions are a condition precedent to
Owner's tax abatement pursuant to this Agreement.
Article V
Construction of Improvements
5.1 As a condition precedent to the initiation of Owner's tax abatement pursuant to this
Agreement, Owner will diligently and faithfully, in good and workmanlike manner, subject to
events of Force Maj eure to cause Commencement of Construction to occur on or before August 15,
2006, or other date mutually agreed to by the parties and to cause Completion of Construction of the
Improvements to occur within two hundred forty (240) calendar days thereafter, as good and
valuable consideration for this Agreement, and 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 Owner shall have such additional time to complete and maintain the Improvements as
may be required in the event of "Force Majeure," if Owner is diligently and faithfully pursuing
completion of the Improvements.
5.2 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 a restaurant building for a period of five (5) years commencing
on the date the first final certificate of occupancy is issued for the Owner's occupancy of the
Improvements.
5.3 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
Owner, and in accordance with Owner'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).
Article VI
General Requirements
6.1 Construction plans for the Improvements to be constructed on the Land will be filed
with the City, which shall be deemed to be incorporated by reference herein and made a part hereof
for all purposes.
Coppell Hard Eight/Tax Abatement Agreement -PAGE 5
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6.2 After completion of the Improvements, Owner shall certify in writing to the City the
construction cost of the Improvements. Owner shall before May 1 of each calendar year that the
Agreement is in effect, certify in writing to the City that it is in compliance with each term of the
Agreement.
6.3 The Land 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.
6.4 Owner agrees, subject to events of Force Majeure, to continuously own and occupy
the Improvements for a period of at least five (5) consecutive years beginning the First Year of
Abatement.
Article VII
Default: Recapture of Tax Revenue
7.1 In the event Owner: (i) fails to complete 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 Owner 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 or anyone or more of the
Related Agreements, then 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 by the Owner to the City without benefit of a tax abatement for the Owner's
property the subject of this Agreement, 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 against the Improvements and the Tangible Personal Property, the subject of
this Agreement, and shall become due, owing and shall be paid to the City within thirty (30) days
after termination.
7.2 Upon breach by Owner of any obligations under this Agreement, or anyone or more
the Related Agreements, the City shall notify the Owner in writing, who shall have sixty (60) days
from receipt of the notice in which to cure any such default. If the default cannot reasonably be
cured within a sixty (60) day period, and the 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 default
must be cured.
7.3 If the 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 the Owner.
Coppell Hard Eight/Tax Abatement Agreement -PAGE 6
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7.4 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 Improvements and the Tangible Personal Property, without tax
abatement for the years in which tax abatement hereunder was received by the Owner, 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.
Article VIII
Miscellaneous
8.1 Annual Application for Tax Exemption. It shall be the responsibility of the 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.
8.2 Notice. 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:
Coppell Hard Eight, Ltd.
Attn: Phillip Nivens
1091 Glen Rose Highway
Stephenville, Texas 76401
With a copy to:
Steven J. Reid
105 W. Pearl St.
Granbury, Texas 76048
(817) 573-3718
(817) 573-9732 FAX
If intended for City, to:
Attn: City Manager
City of Coppell, Texas
P. O. Box 9478
Coppell, Texas 75019
Coppell Hard Eight/Tax Abatement Agreement -PAGE 7
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With copy to:
Peter G. Smith
Nichols, Jackson, Dillard, Hager & Smith, L.L.P.
1800 Lincoln Plaza
500 N. Akard
Dallas, Texas 75201
8.3 City Council Authorization. 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.
8.4 Severability. 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.
8.5 Applicable Law. 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. The parties agree to submit to the personal and subject matter jurisdiction of said
court.
8.6 Counterparts. 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.
8.7 Entire Ae:reement. 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.
8.8 Recordation of Ae:reement. A certified copy of this Agreement shall be recorded in
the Deed Records of Dallas County, Texas.
8.9 Incorporation of Recitals. The determinations recited and declared In the
preambles to this Agreement are hereby incorporated herein as part of this Agreement.
8.10 Exhibits. All exhibits to this Agreement are incorporated herein by reference for all
purposes wherever reference is made to the same.
8.11 Conditions Precedent. This Agreement and the Parties respective obligations, is
subject to and contingent upon: (i) the City and Owner entering into the Economic Development
Agreement; (ii) the Owner and the CEDF entering in to Coppell Hard Eight Purchase and Sale
Agreement; (iii) the City and the CEDF entering into CEDF Purchase and Sale Agreement; and
(iv) the Owner closing the purchase of the Land from the CEDF on or before July 15,2006.
Coppell Hard Eight/Tax Abatement Agreement -PAGE 8
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Signature Page to Follow
Coppell Hard Eight/Tax Abatement Agreement -PAGE 9
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, 2006.
By:
Attest:
B~ f:ttj.I3~
LIbby Bal lty Secretary
By:
City Attorney
(Pgs/06 1906)(74
EXECUTED in duplicate originals the.2t t day of 9~
/'
Coppell Hard Eight, Ltd.
,2006.
By: Big Boy, Inc.
lts ?enp~er -f?
By. . ~ ~
Phillip Nivens
President
Coppell Hard Eight/Tax Abatement Agreement -PAGE 10
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City's Acknowledgment
STATE OF TEXAS ~
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COUNTY OF DALLAS ~
This instrument was acknowledged before me on the z:Jit'day of
2006, by Douglas N. Stover, Mayor of the City of Coppell, Texas, a Texas m
of said municipality.
My Commission Expires:
0-11-08
LIBBY BALL
Notary Public
State of Texas
Comm. Expires 06-11-2008
Owner's Acknowledgment
STATE OF TEXAS
COUNTY OF 1) dk
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This instrument was acknowledged before me on the c2 6 1)"... day of ~. ,
2006, by Phillip Nivens, being the President of Big Boy, Inc. the general partner orCoppell Hard
Eight, Ltd., a Texas limited partnership on behalf of said partnership.
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Coppell Hard Eight/Tax Abatement Agreement -PAGE 11
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Exhibit "A"
Legal Description of the Land
CRESCENT ADDITION
LOT 1, BLOCK A
WHEREAS City of Coppell is the owner of a 2.1898 acre tract of land situated in the James A.
Simmons Survey, Abstract No. 1296, Dallas County, Texas; said tract being part ofa tract of
land described in deed to City ofCoppell recorded in Volume 2003094, Page 0797 of the Deed
Records of Dallas County, Texas; said tract also being part of Block 5, Coppell Commerce
Center Phase I, an addition to the City ofCoppell, recorded in Vol. 81051, pg. 3041, deed
records, Dallas County, Texas; said 2.1898 acre tract bring more particularly described as
follows:
BEGINNING, as a Y2 inch iron rod found for comer, said point being in the south right-of-way
line of Bethel Road (a 50 foot right-of-way); said point also being the northwest comer ofthat
certain 1.09 acre tract ofland described in deed to Camille Juraszek recorded in Volume 99100,
Page 674 of the Deed Records of Dallas County, Texas;
THENCE, South 01 degrees 18 minutes 00 seconds West, departing said south right-of-way line
of Bethel Road, a distance of 183.30 feet to a 1f2 inch iron rod found for comer; said point being
in the north line ofa 18.918 acre tract ofland described in deed to KCO TXII Coppell Inv. Ltd
recorded in Volume 2000246, Page 3694 of the Deed Records of Dallas County, Texas;
THENCE, North 89 degrees 01 minutes 04 seconds West, a distance of 520A1 feet to a "+" cut
found on the top of curb in the east right-of-way line of Freeport Parkway (a 70 foot right-of-way
at this point);
THENCE, North 01 degrees 18 minutes 00 seconds East, along said east right-of-way line of
Freeport Parkway, a distance of183.30 feet to a 1f2 inch iron rod wf'PACHECO KOCH' cap set
for comer; said point being at the intersection of the east right-of-way line of Freeport Parkway
and the south right-of-way line of Bethel Road;
THENCE, South 89 degrees 01 minutes 04 seconds East, departing said east right-of-way line of
Freeport Parkway and along said south right-of-way line of Bethel Road, a distance of 520Al
feet to the POINT OF BEGINNING;
CONTAINING, 95,390 square feet or 2.1898 acres ofland, more or less.
Connell Hard Ei2htlTax Abatement Aro-eement -PAGE 12
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