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RE 2000-12-12.8 IE/E0/00 2~E353 133. Deed RESOLUTION NO. 20001212.8 /Z 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 DUKE-WEEKS REALTY LIMITED PARTNERSHIP (FREEPORT V); AUTHORIZING ITS EXECUTION BY THE MAYOR; AND PROVIDING AN EFFECTIVE DATE. ' WFrF~REAS, the City Council has been presented a proposed Tax Abatement Agreement by and among the City of Coppell, Texas and Duke-Weeks Realty Limited Partnership (Freeport V), 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 Coppelt, 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. 37295 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 12th day of December, 2000. CITY OE OPPELL, TEXA CANDY SHEt~,HA~,~IXYC)'R ATTEST: L BY ALLJ~~TIY APPROVE O F : ROB ITY ATTORNEY 37295 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"), duly acting herein by and through its Mayor, and Duke-Weeks Realty Limited Partnership ("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. 3 1 (the "Zone"), for commercial/industrial tax abatement, as authorized by the Property Redevelopmerit 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' 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 to the Premises 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 (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 Premises is located; and TAX ABATEMENT AGREEMENT - Page 1 37287 03965 WHEREAS, the City desires to enter into an agreement with Owner, the proposed owner of the Premises within the Tax Abatement Reinvestment Zone 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: GENERAL PROVISIONS 1. Owner is the owner of the real property described in Exhibit "A" attached hereto and made a part hereof for all purposes (the "Land" hereinafter defined), which real property is located within the city limits of the City and within the Zone. 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 City Tax Abatement Guidelines and Criteria, and approved by resolution of the City Council of the City authorizing the execution of this Agreement. 6. Subject to the terms and conditions of this Agreement, and provided the Taxable Value for the Improvements is at least Five Million Five Hundred Thousand Dollars ($5,500,000) as of January 1 of the First Year of Abatement and as of January 1 of each year thereafter 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. 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 for the Land, the year in which this Agreement is executed (base year/2000). 7. The period of tax abatement herein authorized shall be for a period of five (5) years. TAX ABATEMENT AGREEMENT - Page 2 37287 03966 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: A. The "Base Year Taxable Value" shall mean the total assessed taxable value for the Premises for the year in which the Tax Abatement Agreement is executed (2000). B. An "Event of Bankruptcy or Insolvency" shall mean the dissolution or termination of Owner's existence as a going business, insolvency, appointment of receiver for any part of Owner'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 Owner and such proceeding is not dismissed within ninety (90) days after the filing thereof. C. The "First Year of Abatement" shall mean January 1 of the calendar year immediately following the issuance of a certificate of occupancy for the Improvements. D. "Force 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, government or de facto governmental action (unless caused by acts or omissions of Owner), fires, explosions or floods, strikes, slowdowns or work stoppages. E. The "Improvements" shall mean the contemplated improvements to be constructed on the Premises and as further described herein. F. The "Land" shall mean the real property described in Exhibit "A" attached hereto and incorporated herein for all purposes. G. The "Premises" shall mean the Land described in Exhibit "A" including the Improvements but excluding Tangible Personal Property which is added thereto subsequent to the execution of this Agreement; H. "Taxable Value" means the appraised value as certified by the Appraisal District as of January 1 of a given year. I. "Tangible Personal Property" shall mean tangible personal property, equipment and fixtures other than inventory or supplies added to the Premises subsequent to the execution of this Agreement. TAX ABATEMENT AGREEMENT - Page 3 37287 2 ;2146 0396 7 IMPROVEMENTS 10. Owner owns the real property described in Exhibit "A" and agrees to construct or cause to be constructed thereon office/warehouse facility known as Freeport V, containing 115,000 square feet (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) (the "Improvements"). The cost of the Improvements excluding the land shall be at least Five Million Five Hundred Thousand Dollars ($5,500,000). Nothing in this Agreement shall obligate Owner to construct the Improvements on the Premises, but said action is a condition precedent to tax abatement pursuant to this Agreement. CONSTRUCTION OF IMPROVEMENTS l l. 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 completion of the contemplated Improvements on or before December 31, 2001, as good and valuable consideration for this Agreement, and that all construction of the Improvements will be in accordance with all applicable state and local laws, codes, and regulations, (or valid waiver thereof); provided, that 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. 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 five (5) years commencing on the date a certificate of occupancy is issued for the Improvements. 13. The City, its agents and employees shall have the right of access to the Premises during construction to inspect the Improvements at reasonable times and with reasonable notice to 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). GENERAL REQUIREMENTS 14. Construction plans for the Improvements constructed on the Premises will be filed with the City, which shall be deemed to be incorporated by reference herein and made a part hereof for all purposes. 15. After completion of the Improvements, Owner shall certify in writing to the City the construction cost of the Improvements. Owner shall also annually certify to the City that it is in compliance with each term of the Agreement. 16. The Premises and the Improvements constructed thereon at all times shall be used in the manner (i) that is consistent with the City' s Comprehensive Zoning Ordinance, as amended, and TAX ABATEMENT AGREEMENT - Page 4 37287 · z'sTl 246 03968 (ii) that, during the period taxes are abated hereunder, is consistent with the general pt~oses of encouraging development or redevelopment within the Zone. 17. Owner agrees to provide to the tenants of the Premises, the benefit of the abatement of real property taxes granted herein. Owner shall, upon written request, provide the City with satisfactory evidence that the benefits of this Agreement have been provided to the tenants of the Premises. DEFAULT: RECAFrURE OF TAX REVENUE 18. 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 State sales taxes owed to the City with respect to the Premises (provided Owner retains its right to timely and prope~y protest such taxes or assessment); (iii) has any "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, 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 Owner, its successors and assigns and shall constitute a tax lien on the Premises and shall become due, owing and shall be paid to the City within thirty (30) days after termination. 19. Upon breach by Owner of any obligations under this Agreement, the City shall notify Owner in writing. Owner 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. 20. 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. 21. 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 sixty (60) 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 without tax abatement for the years in which tax abatement hereunder was received by Owner with respect to the Improvements as determined by the Appraisal District, multiplied by the tax rate of the years in question, as calculated by the City TAX ABATEMENT AGREEMENT - Page 5 37287 03969 Tax Assessor-Collector. The liquidated damages shall incur penalties as provided for delinquent taxes and shall commence to accrue after expiration of the sixty (60) day payment period. ANNUAL APPLICATION FOR TAX EXEMPTION; RENDITION 22. 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 sims. A copy of the exemption application shall be submitted to the City. SUCCESSORS AND ASSIGNS 23. 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 to any successor, owner of the Improvements following the completion thereof or, prior to such completion, 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 occurring or arising after the date of such assignment. NOTICE 24. 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: Jeff Turner Duke-Weeks Realty Corporation 5495 Beltline Road, Suite 360 Dallas, Texas 75240 ff intended for City, to: Attn: 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 TAX ABATEMENT AGREEMENT - Page 6 37287 z ii2 4 6 O 3 9 7 0 CITY COUNCIL AUTHORIZATION 25. 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 26. 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 27. 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 29. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original and constitute one and the same instrument. ENTIRE AGREEMENT 29. 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. CONVENANTS RUNNING WITH THE PREMISES 30. The provisions of this Agreement are hereby declared covenants running with the Premises and are fully binding on all successors, heirs, and assigns of Owner who acquire any right, title, or interest in or to the Premises, or any part thereof. Any person who acquires any right, title, or interest in or to the Premises, or any part hereof, thereby agrees and covenants to abide by and fully perform the provisions of this Agreement with respect to the right, title or interest in such Premises. RECORDATION OF AGREEMENT 3 1. A certified copy of this Agreement shall be recorded in the Deed Records of Dallas County, Texas. TAX ABATEMENT AGREEMENT - Page 7 37287 03971 INCORPORATION OF RECITALS 32. The determinations recited and declared in the preambles to this Agreement are hereby incorporated herein as part of this Agreement. EXHIBITS 33. All exhibits to this Agreement are incorporated herein by reference for all purposes wherever reference is made to the same. EXECUTED in duplicate originals this the 14th day of Dec., 2000. ATTE~T:ANDY SHE/HAN, MAYOR By: ~ CITY SECRETLY AGREED O EXECUTED in duplicate originals this the 27th day of November, 2000. DUKE-WEEKS REALTY CORPORATION Name. Title: ' TAX ABATEMENT AGREEMENT - Page 8 37287 ' m246 03972 CITY'S ACKNOWLEDGMENT STATE OF TEXAS § COUNTY OF DALLAS § This instrument was acknowledged before me on the 14th day of December 2000, by Candy Sheehan, Mayor of the City of Coppell, Texas, a Texas municipality, on behalf of said municipality. My Commission Expires: ,--..' TAX ABATEMENT AGREEMENT - Page 9 37287 ; 2t46 03973 OWNER'S ACKNOWLEDGMENT STATE OF TEXAS § COUNTY OF DALLAS § This instrument was acknowledged before me on the 27th day of November 2000, by '~.~,-,..~. -'xr,~e.~..~- being the ~2,~ q.~ of Duke-Weeks Realty Coloration, on behalf of said coloration in its capacity as general p~ner of Duke- Weeks Li~ted P~nership, on behalf of said li~ted p~nership. (~ ~ OTARY PUBLIC ~%~:~c N ~ ~Ot~y Public;State of Texas My Co~ssion Expires: TAX ABATEMENT AGREEMENT - Page 10 37287 :'2m7246 0397 DESCRIPTION OF PROPERTY SURVEYED EXHIBIT 'A' ~-~I2L~6 03975