RE 2018-1211.7 Prologis Tax Abatement Bldg 5aRESOLUTION NO. 2otg,1? { •1
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 PROLOGIS, 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 Prologis, L.P., 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 improvements proposed for the Premises will accomplish the tax
abatement guidelines of the City of Coppell, Texas.
SECTION 4. 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.
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SECTION 5. 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 6. 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 day of , 2018.
IATTEST:
Oyu
r-TWSTEL PETTKO , CITY SECA-11ARY
APPROVED AS TO FORM:
JAV&M
CITY ATTORNEY 0
2
Exhibit "A"
(copy of Tax Abatement Agreement
to be attached)
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 Prologis, L.P., a Delaware limited partnership (the "Owner")
(each a "Party" and collectively the "Parties"), acting by and through their authorized representatives.
WITNESSETH:
WHEREAS, the City Council of the City of Coppell, Texas (the "City Council"), passed an
Ordinance (the "Ordinance") establishing Tax Abatement Reinvestment Zone No. 91 (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 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 approximately 12.72 acres of land
in Prologis Park, 121 Freeport Parkway and Highway 121, Coppell, Texas, being further described in
Exhibit "A" ("Land"), and intends to construct, or cause to be constructed, a shell industrial building
containing approximately 40,480 square feet of space known as Building 5A (hereinafter defined as
the "Improvements") 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), and the contemplated Improvements 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
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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;
NOW, THEREFORE, in consideration of the mutual benefits and promises contained herein
and for other good and 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:
"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.
"Base Year Taxable Value" shall mean the Taxable Value for the Land for the year in
which the Tax Abatement Agreement is executed.
"City" shall mean the City of Coppell, Texas.
"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 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: (i) substantial completion of the Improvements;
and (ii) a final certificate of occupancy has been issued for the Improvements.
"Effective Date" shall mean the last date of execution of this Agreement.
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"Expiration Date" shall mean March 1 of the calendar year following the fifth (5th)
anniversary date of the First Year of Abatement.
"First Year of Abatement" shall mean January 1 of the calendar year immediately
following the date of Completion of Construction.
"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 a shell industrial building containing approximately 40,480
square feet of space upon Completion of Construction thereof 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), provided,
however, that "Improvements" shall not include the Land.
"Land" means the real property described in Exhibit "A".
"Owner" shall mean Prologis, L.P., a Delaware limited partnership.
"Premises" shall mean collectively, the Land and Improvements following construction
thereof.
"Related Agreement" shall mean any other agreement by and between the City and the
Owner, its parent company, and any affiliated or related entity owned or controlled by the Owner,
or its parent company.
"Taxable Value" means the appraised value as certified by the applicable Appraisal District
(or its successor) as of January 1 of a given year.
Article II
General Provisions
2.1 Owner is the owner of the Land, or 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, or cause
to be constructed, 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.
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2.5 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.
2.6 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 Irnprovements, excluding the Land, is at least One Million Dollars ($1,000,000.00) as
of January 1 of the First Year of Abatement and as of January 1 of each calendar year thereafter during
the term of this Agreement, 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 foregoing 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 failure of the
Improvements to have a Taxable Value of at least One Million Dollars ($1,000,000.00) as of January
1 of any given Tax Year shall not be an event of default subject to termination and repayment of the
abated taxes pursuant to Article V hereof but shall result in the forfeiture of the tax abatement for the
Improvements for such Tax Year.
3.3 The period of tax abatement herein authorized shall be for a period of five (5)
consecutive years beginning with the First Year of Abatement.
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 the Land.
3.5 The term of this Agreement shall begin on the Effective Date and shall continue
until the Expiration Date, unless sooner terminated as provided herein.
Article IV
Improvements
4.1 Owner owns or is under contract to purchase the Land and intends to construct or
cause to be constructed thereon the Improvements. Nothing in this Agreement shall obligate Owner
to construct the Improvements on the Land, but said actions are conditions precedent to tax abatement
for such Parties pursuant to this Agreement.
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4.2 As a condition precedent to the initiation of the Owner's tax abatement pursuant to
this Agreement, Owner agrees, subject to events of Force Majeure, to cause Commencement of
Construction of the Improvements to occur within on or before December 1, 2018, and subject to
events of Force Majeure to cause Completion of Construction of the Improvements to occur on or
before eighteen (18) 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.
4.4 Owner agrees to maintain the Improvements during the term of this Agreement in
accordance with all applicable state and local laws, codes, and regulations.
4.5 The City, its agents and employees shall have the right of access to the Premises
during and following construction to inspect the Improvements at reasonable times and with
reasonable notice to Owner, and in accordance with visitor access and security policies of the Owner,
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: (i) Owner fails to cause Commencement and/or 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, or a Related 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
property the subject of this Agreement 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
notice of termination.
5.2 Upon breach by Owner of any of the obligations under this Agreement, the City shall
notify Owner in writing, which 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 such 30 -day period, and the Owner
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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, the City, at its sole option, shall have the right to terminate this
Agreement by providing 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 provided. 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 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 for the Improvements with the Chief Appraiser for the Appraisal District
(or its successor) in which the eligible taxable property has situs. A copy of the respective 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
shall provide a copy of the same to the City upon written request.
Article VIII
Miscellaneous
8.1 Notice. Any notice required or permitted to be delivered hereunder shall be deemed
received three (3) days thereafter sent by United States Mail, postage prepaid, certified mail, return
receipt requested, addressed to the Party at the address set forth below or on the day actually
received if sent by courier or otherwise hand delivered:
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If intended for City, to:
Attn: City Manager
City of Coppell, Texas
P. O. Box 478
Coppell, Texas 75019
If intended for Owner, to:
Attn: Market Officer
Prologis, L.P.
2021 McKinney Avenue
Suite 1050
Dallas, Texas 75201
With a copy to:
Peter G. Smith
Nichols, Jackson, Dillard, Hager & Smith, L.L.P.
1800 Ross Tower
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 governed by the laws of the State of Texas
without regard to any conflict of law rules. Exclusive 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.
8.5 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 Recitals. The determinations recited and declared in the preambles to this Agreement
are hereby incorporated herein as part of this Agreement.
8.8 Exhibits. All exhibits to this Agreement are incorporated herein by reference for all
purposes wherever reference is made to the same.
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8.9 Assionnient. 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 by the Owner without the prior
written consent of the City Manager.
8.10 Employment of Undocumented Workers. During the term of this Agreement, the
Owner agrees not to knowingly employ any undocumented workers and, if convicted of a violation
under 8 U.S.C. Section 1324a (f), the Owner shall repay the taxes abated herein, and any other
funds received by the Owner from the City as of the date of such violation within 120 days after
the date the Owner is notified by the City of such violation, plus interest at the rate of six percent
(6%) compounded annually from the date of violation until paid.
8.11 Right of Offset. The City may at its option, offset any amounts due and payable
under this Agreement against any debt (including taxes) lawfully due to the City from the Owner,
regardless of whether the amount due arises pursuant to the terms of this Agreement or otherwise
and regardless of whether or not the debt due the City has been reduced to judgment by a court.
[Signature page to follow]
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City of Coppell and Prologis, L.P. (Building 5a)
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EXECUTED in duplicate originals the day of , 2018.
CIT7
i By:
Agreed as to Form:
Attest:
By:
Christel Pettinos, City Secretary
r�
EXECUTED in duplicate originals the day of A, 2018.
Prologis, L.P.,
a Delaware limited partnership
By: Prologis, Inc.,
a Maryland corporation,
its general partner
Na.
Title: Senior Vice President
Page 9 Tax Abatement Agreement
City of Coppell and Prologis, L.P. (Building Sa)
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Exhibit "A"
Legal Description
Mindi to provide
Page 1 Exhibit "A" to Tax Abatement Agreement
City of Coppell and ProLogis, LP (Callejo Tract Building 5a)
2.93853