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RE 2007-1211.2 RESOLUTION NO. 2007-1211.2 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 TDC GATEWAY BUSINESS CENTER, L.P.; 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 TDC Gateway Business Center, L.P., a Texas limited partnership, 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 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. 1 17906 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 affrrmative vote of the majority of the members of the City Council of the City of Coppell, Texas, at a regularly scheduled meeting ofthe 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 / I ~ay ATTEST: ~'/~~M~ LIBBYBAL , ITYSECRETARY 2 17906 m 11111111111111111111111111111111111111111111111111111111111111111 AGREE /20080025306 12 PGS . STATE OF TEXAS ~ ~ ~ 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 TDC Gateway Business Center, L.P., a Texas limited partnership ("Owner"), acting by and through their authorized representatives. WITNES SETH: WHEREAS, the City Council of the City of Coppell, Texas, (the "City"), passed an Ordinance (the "Ordinance") establishing Tax Abatement Reinvestment Zone No. 58 (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 approximately 18 acres of land in Gateway Corporate Center on Freeport Parkway north of Interstate Highway 635, and being further described in Exhibit "A" ("Land") and intends to construct two (2) two-story office buildings containing in the aggregate approximately 225,J10 square feet of space hereinafter defined as (the "Improvements") on the Land; and 2 z-s,ot:1 l> t:L- ~ z:. WHEREAS, Owner's development efforts described herein will create permanent new jobs in the City; and ~ o --1 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 N . - IDC Gateway Business Center//Tax Abatement Agreement -Page 1 21235 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 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 the Owner for the abatement of taxes pursuant to Chapter 312 of the Tax Codeas 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 Definitions Wherever used in this Agreement, the following terms shall have the meanings ascribed to them: “Base YearTaxable Value” shall mean the Taxable Value for the Land for the year in which the Tax Abatement Agreement is executed (2007). “Commencement of Construction” shall mean that: (i) the plans have been prepared and all approvals thereof and permits with respect thereto required by applicable governmental authorities have been obtained for construction of the Improvements; (ii) all necessary permits for the construction of the Buildings, 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: (i) substantial completion of the Improvements; and (ii) a final certificate of occupancy has been issued for the last of the Buildings. “Effective Date” shall mean the last date of execution of this Agreement. “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. TDC Gateway Business Center//Tax Abatement Agreement –Page 2 21235 “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 first of the two Buildings comprising the Improvements. “Force Majeure” shall mean any contingency or cause beyond the reasonable control of a partyincluding, 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 collectively mean a two (2) story office building containing 111,934 square feet and 116,156 square feet to be constructed on the Land 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(s). “Land” means the real property described in Exhibit “A”. “Premises” shall collectively mean the Land and the Improvements following construction thereof. “Taxable Value” means the appraised value as certified by the Appraisal District as of January 1 of a given year. Article II General Provisions 2.1 Owner is the owner of, 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. 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. 2.5 The Owner agrees to provide to the tenants of the Premises, the benefit of the tax abatement of the Improvements granted herein. Owner shall, upon written request, provide the City, with satisfactory evidence that the benefits of this Tax Abatement Agreement have been provided to any such tenants. 2.6 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. TDC Gateway Business Center//Tax Abatement Agreement –Page 3 21235 2.7 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. 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, and provided the Taxable Value for the Improvements, excluding the Land, is at least $5.5 Million Dollars ($5,500,000.00) as of January 1 of the First Year of Abatement and as of January 1 of each 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 Improvements for a period of five (5) consecutive years beginning with the First Year of Abatement. 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. 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. Article IV Improvements 4.1 Owner owns, the Land and intends to construct or caused to be constructed thereon the Improvements. Nothing in this Agreement shall obligate Owner to construct the Improvements on the Land but said action is a condition precedent to tax abatement pursuant to this Agreement. 4.2 As a condition precedent to the initiation of the Owner’s tax abatement pursuant to this Agreement, Owneragrees, subject to events of Force Majeure, to cause Commencement of Construction of the Improvements to occur on or before August 31, 2007, and to cause Completion of Construction of the Improvements to occur within twelve (12) calendar months thereafter, 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). 4.3 Construction plans for the Improvements 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. TDC Gateway Business Center//Tax Abatement Agreement –Page 4 21235 4.4 Owneragrees 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 industrial warehouse/office buildings (with ancillary office uses) for a period of five (5) years commencing on the date the final certificate of occupancy is issued for the Building. 4.5 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 V Default: Recapture of Tax Revenue 5.1 In the event Owner: (i) fails to cause Completion of Construction of 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, 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 Improvements, 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 Premises, and shall become due, owing and shall be paid to the City within thirty (30) days after termination. 5.2 Upon breach by Owner of any obligations under this Agreement, the City shall notify the 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 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. 5.3 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. 5.4 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 TDC Gateway Business Center//Tax Abatement Agreement –Page 5 21235 schedule. The computation of the abated tax for the purposes of the Agreement shall be based upon the full Taxable Valueof the Improvements, 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 VI 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. Article VII Annual Rendition The Owner shall annually render the value of the Improvements to the Appraisal District and provide a copy of the same to the City upon written request. Article VIII Miscellaneous 8.1 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: Attn: Ric Nelson TDC Gateway Business Center, L.P. 5001 Spring Valley Road, Suite 600 West Dallas, Texas 75244 If intended for City, to: Attn: City Manager City of Coppell, Texas P. O. Box 478 Coppell, Texas 75019 TDC Gateway Business Center//Tax Abatement Agreement –Page 6 21235 With a copy to: Peter G. Smith Nichols, Jackson, Dillard, Hager & Smith, L.L.P. 1800 Lincoln Plaza 500 N. Akard Dallas, Texas 75201 8.2 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. 8.3 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. 8.4 Governing 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. This Agreement is performable in Dallas County, Texas. The parties agree to submit to the personal and subject matter jurisdiction of said court. 8.5 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. 8.6 Entire Agreement. 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. 8.7 Recordation. A certified copy of this Agreement shall be recorded by the City, at no cost to Owner, in the Deed Records of Dallas County, Texas. 8.8 Recitals. The determinations recited and declared in the preambles to this Agreement are hereby incorporated herein as part of this Agreement. 8.9 Exhibits. All exhibits to this Agreement are incorporated herein by reference for all purposes wherever reference is made to the same. 8.10 Assignment. 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 permitted assigns. This Agreement may not be assigned without the prior written consent of the City Manager. TDC Gateway Business Center//Tax Abatement Agreement –Page 7 21235 City of By: Douglas N. Stover, Mayor Attest: B~A/~/ ib Y Ball, C Secretary By: City Attorney EXECUTED in duplicate originals the ;1%y Of~ ' 2~ TDC Gateway Business Center, L.P. By: ~_~ Name: Ric Nelson Title: ~ ' v' (J . , IDC Gateway Business Center//Tax Abatement Agreement -Page 8 TDC Gateway Business Center//Tax Abatement Agreement -Page 9 - 21235 21235 City's Acknowledgment State of Texas ~ ~ County of Dallas ~ This instrument was acknowledged Before Me on the //~ay Of~~./.LJ1~ 2007, By Douglas N. Stover, Mayor of the City of Coppell, Texas, a Texas municipality, on behalf of said municipality. fa -//-()13 My Commission Expires: LIBBY BAL~ Notary Publii.: State of TeXd:> Comm. Expires 06-11-7" Owner's Acknowledgment State of Texas ~ ~ ~ County 0"1"\)"", \ lc. "" This instrument was acknowledged Before Me on the .is- day of~ ("\LA ~r'":1 ' 2007, by Ric Nelson, of TDC Gateway Business Center, L.P., a Texas hmited partnership, on behalf of said partnership. ~(YJ C:Sf.~l.. .Q otary Pubhc, State of Texas My Commission Expires: eRn I 0 ,\,\I'""f'/ "" OEe/( /11 ......' ~ ........ ~//....... ,~'; Q. "'6~j(''''1',( PU8(~;;.: ~ ,.;,. .-' ~,. ...-;. ~_ (.,~ ~) J '.- \ ~~Cf~ .. - ...~ "v-............., ~...... ~ ~~""" /,)~.> ..".... .;.,{\~. " '.. ,0...,.. 2' '''''-,' i It.. "" ;::!t,~U\,\ TDC Gateway Business Center//Tax Abatement Agreement -Page 9 21235 - Exhibit “A” Legal Description of Land To Be Attached TDC Gateway Business Center//Tax Abatement Agreement –Page 10 21235 LEGAL DESCRIPTION OWNER'S CERTIFICATE STATE OF TEXAS COUNTY OF DALLAS WHEREAS TDC Gateway Business Center, L.P. is the owner of a tract of land situated In the City of Coppell, Dallas County, Texas, and being a part of the Cardelia Bowen Survey, Abstract Number 56 and the Joel Wilson Survey, Abstract Number 1555 and being pert of a tract of land described as Tract A to TDC Gateway Business Center, L.P. as recorded In Document No. 200600457351, Official Public Records of Dallas County, Texas, (O.P.R.D.CT), and being more particularly described as follows: COMMENCING at a 1/2-lnch found Iron rod with a yellow plastic cap stomped 'HALFF ASSOC INC' (hereinafter referred to as 'with cap') for the southwest corner of Gateway Business Park No.2, an addition to the City of Coppell as recorded In Volume 98043, Page 0001, Deed Records of Dallas County, Texas D.R.D.C.T., and being on the northerly right-of-way line of Interstate Highway 635 as recorded in Volume 79122, Page 1381 ,D.R.D.C.T.; THENCE South 36 degrees 44 minutes 37 seconds East, along said northerly right-of-way line, a distance of 575.13 feet to the POINT OF BEGINNING at a 112-lnch set Iron rod with cap on the south line of a Lone Star Gas Company easement as recorded In Volume 71167, page 1308,D.R.D.C.T.; THENCE South 89 degrees 03 minutes 34 seconds East, along the south line of said Lone Star Gas Company Easement and along the south line of a Lone Star Gas Company Easement as recorded In Volume 71167, Page 1306, D.R.D.C.T., a distance of 1033.54 to a 1/2-1 nch set Iron rod with cap on the west right-of-way line of Freeport Parkway (0 variable width right-of-way) as recorded In Volume 98067, Page 3324,D.R.D.C.T.; THENCE South 35 degrees 16 minutes 43 seconds East, along said west right-of-way line, 0 distance of 104.07 feet to a 1/2-1 nch set Iron rod with cop for the point of curvature of a tangent circular curve to the right having a radius of 770.00 feet and whose chord bears South 11 degrees 48 minutes 27 seconds East, a distance of 613.36 feet, from which a 5/8-lnch found Iron rod bears South 24 degrees 51 minutes 40 seconds East, a distance of 1.99 feet; THENCE Southeasterly, continuing along said west right-of-way line and along said curve to the right, through a central angle of 46 degrees 56 minutes 33 seconds, an arc distance of 630.86 feet to a 1/2-lnch set Iron rod with cap for the point of tangency; THENCE South 11 degrees 39 minutes 50 seconds West, continuing along said West right-of- way line, a distance of 245.91 feet to the southerly southwest corner of said right-of-way for Freeport Parkway; THENCE South 78 degrees 20 minutes 10 seconds East, along the south line of said right-of- way, a distance of 0.39 feet to a point for corner of a tract of land described to the Texas Department of Transportation TxDOT) as recorded In Volume 84195, Page 0604, D.R.D.C.T., and being on the northerly right-of-way line of Interstate Highway 635, from which a TxDOT brass disc monument found bears North 56 degrees 3- minutes 39 seconds West, a distance of 0.19 feet; THENCE South 66 degrees 59 minutes 56 seconds West, departing said Freeport Parkway right- of-way line and along said I. H. 635 right-of-way line, a distance of 80.88 feet to a point for corner, from which a 5/8-lnch found Iron rod beers South 28 degrees 04 minutes 11 seconds East, a distance of 1.75 feet; THENCE North 80 degrees 50 minutes 21 seconds West, continuing along sold I. H. 635 right-of-way line, a distance of 68.28 feet to 0 point for corner, from which 0 found TxDOT monument bears North 34 degrees 52 minutes 11 seconds West, a distance of 0.30 feet; THENCE North 78 degrees 19 minutes 41 seconds West, continuing along said I. H. 635 right-of-way line, a distance of 275.97 feet to a TxDOT brass disc monument found for corner; THENCE North 63 degrees 57 minutes 56 seconds West, continuing along said I. H. 635 right-of-way line, a distance of 157.53 feet to a point for corner, from which 0 found TxDOT brass disc monument beers North 01 degree 26 minutes 07 seconds West, a distance of 0.36 feet; THENCE North 42 degrees 29 minutes 08 seconds West, continuing along said I. H. 635 right-of-way line, a distance of 141.98 feet to a point for corner, from which a found TxDOT brass disc monument bears North 17 degrees 03 minutes 27 seconds East, a distance of 0.32 feet; THENCE North 59 degrees 21 minutes 26 seconds West, continuing along sold I. H. 635 right-of-way line, a distance of 28.00 feet to a TxDOT brass disc monument found for corner on the northeasterly line of a tract of land described to the State of Texas as recorded In Volume 79122, Page 1381, D.R.D.C. T.; THENCE North 34 degrees 23 minutes 31 seconds West, continuing along sold I. H. 635 right-of-way line and along said northeasterly line, a distance of 810.50 feet to 0 1/2-lnch set Iron rod with cap for corner, from which a 1/2-inch found Iron rod bears South 23 degrees 36 minutes 22 seconds East, a distance of 1.95 feet; THENCE North 36 degrees 44 minutes 37 seconds West, continuing along said I. H. 635 right-of-way line, a distance of 63.87 feet to the POINT OF BEGINNING AND CONTAINING 787,831 square feet or 18.09 acres of land, more or less. FILED AND RECORDED ~TIOA I (,0 C-~,,~ \ OFFICIAL PUBLIC RECORDS (~~ ~~\ ~~ ~" '0'0/ 7"- .?~;/ John F. Warren, County Clerk Dallas County TEXAS January 24, 2008 12:31:44 FEE: $60.00 20080025306