HomeMy WebLinkAboutResolution No. 2012-042CITY OF THE COLONY, TEXAS
SOLUTION 0.201 -042
WHEREAS, The Colony Economic Development Corporation (hereinafter referred to
as the "EDC") is a Type A economic development corporation, created pursuant to Chapter 504
of the Texas Local Government Code, as amended; and
WHEREAS, on November 15, 2011, the City Council (the "City Council") of the City of
The Colony, Texas (the "City") approved a Type A Performance Agreement by and between the
EDC, TX M, Inc., and LMG Ventures, LLC, effective November 15, 2011, as amended
(hereinafter :referred to as the "Type A Performance Agreement"); and
WHEREAS, the Type A Performance Agreement provides that Project Costs (as defined
therein) may he reimbursed or paid from Type A Sales Tax Revenues (as defined therein)
deposited into the Type A Reirnbursernent Account (as defined therein); and
WHEREAS, the City, EDC, and NFM Services, LLC, a 'T'exas limited liability company
("NFM Services") contemplatc that NFM Services will advance funds to or on behalf of the City
and/or the EDC to pay Project Costs allocable to the Warehouse & Distribution Facilities and
Warehouse Public Improvements, as those terms are defined in the Reimbursement Agreement
attached hereto as Exhibit A and incorporated by reference as a part of this resolution for all
purposes (the "Agreement"); and
WHEREAS, the City Council hereby determines it is in the best interest of the City to
adopt this Resolution approving and ratifying the attached Agreement and hereby finds that the
Agreement benefits the City and the EDC.
NOW 'I'RE F®RZE, BE IT SOLVED BY T CITY COUNCIL OF THE CITY
OF THE COLONY, TEXAS, THAT:
SECTION 1. Each and every one of the recitals, findings, and determinations contained in
the preamble to this Resolution, as well as each and every one of the recitals, findings, and
determinations contained in the Agreement, a copy of which is attached hereto as Exhibit A, are
incorporated into the body of this Resolution as if filly set forth herein and are hereby found and
declared to be true and correct legislative findings and are adopted as part of this Resolution for all
purposes.
SECTION 2. The City Council of the City of The Colony, Texas, does hereby approve
the Agreement, a copy of which is attached hereto as Exhibit A, and is incorporated herein for all
purposes.
SECTION 3. If any section, article paragraph, sentence, clause, phrase or word in this
Resolution, or application thereto to any persons or circumstances, is held invalid or
unconstitutional by a Court of competent jurisdiction, such holding shall not affect the validity of
the remaining portions of this Resolution; and the City Council hereby declares it would have
passed such remaining portions of this Resolution despite such invalidity, which remaining portions
shall remain in full force and effect.
SECTION 4. This Resolution shall become effective immediately upon passage.
PASSED AND APPROVED BY THE CITE' COUNCIL OF THE CITY E THE
COLONY, TEXAS, THIS THE I5"' day of MAY, 2012.
e McCou ,Mayor
ATTEST: s~
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Christie Wilson, City Secretary
APP--'OVED AS TO FORM:
Jeff Moore,
iy Attorney
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Exhibit A
4 IMB S.E ENT AGREEMENT
This REIMBURSEMENT AGREEMENT (the "Agreement") is made and entered into
by and between The City of The Colony, Texas, a Texas home-rule municipality (the "City'"),
The Colony Economic Development Corporation, a Type A economic development corporation,
created pursuant to Chapter 504 of the Texas Local Government Code, as amended, and a Texas
non--profit corporation (the "EDC"), and NFM Services, LLC, a Texas lirnited liability company
("NF Services"), and collectively referred to as the "Parties."
WHEREAS, EDC is a Type A economic development corporation operating pursuant
to the applicable provisions of the Development Corporation Act, Subtitle C1 of the Texas Local
Government Code, as amended (also referred to as the "Act"), and the Texas Non-Profit
Corporation Law, as described in Section 1.008(4) of the Texas Business Organizations Code,
as amended; and.
WHEREAS, on November 15, 2011, the City Council of the City (the "City Council")
approved a Type A Performance Agreement by and between the EDC, TXFM, Inc., a Texas
corporation ("TXFM"), and. LMG Ventures, LLC, a Texas limited liability company ("LMG"),
effective November 15, 2011 (as the same may be amended from time to time, the "Type A
Performance Agreement'"); and
WHEREAS, the Type A Performance Agreement provides that Project Costs may be
reimbursed or paid from Type A sales tax revenues (the "Type A Sales Tax Revenues'")
deposited into the Type A reimbursement account (the "Type A Reimbursement Account"); and
WHEREAS, the Parties contemplate that NFM Services will advance funds to or on
behalf of the City and/or the EDC to pay Project Costs allocable to the Warehouse &
Distribution Facilities and Warehouse Public Improvements (the "NFM Advances'").
NOW, THEREFORE, for and in consideration of the agreements contained herein, and
other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the City, the EDC, and NFM Services agree as follows:
SECTION 1. FINDINGS INCORPORATED.
The foregoing recitals are hereby incorporated into the body of this Agreement and shall
be considered part of the mutual covenants, consideration and promises that bind the parties.
SECTION 2. TERM,
This Agreement shall be effective as of the Effective Date, and shall continue thereafter
until all obligations of the City, EDC, and NFM Services have been Performed in full, unless
terminated sooner under the previsions hereof.
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SECTION 3. DEFINITIONS.
The following words shall have the following meanings when used in this Agreement.
(a) Act. The word "Act" means the Development Corporation Act, Subtitle Cl of the Texas
Local Government Code, as amended..
(b) Agreement. The word "Agreement" means this Reimbursement Agreement, together
with all exhibits and schedules attached hereto, if any, and as the same may be amended
from time to time,
(c) Bond. The word. "Bond" means any bond, note, or other evidence of indebtedness issued
by the EDC and secured by funds in the Type A Reimbursement Account.
(d) Bond Validation Final Judgment, The words "Bond Validation Final Judgment" mean
the "Final Judgment" entered January 18, 2012, in Ex Parte City of The Colony filed by
the City of The Colony, Texas, pursuant to Chapter 1205 of the Texas Government Code,
in the 53rd Judicial District Court of Travis County, "Texas, Cause No. 0-1-GV-11-
001995.
(e) City. The word "City" means the City of The Colony, Texas. For purposes of this
Agreement, the City's address is City of The Colony, 6800 Main Street, The Colony,
Texas 75056.
(f) City Council. The words "City Council" mean the City Council of the City.
(g) EDC. The word "EDC" means The Colony Economic Development Corporation, a Type A
economic development corporation, created pursuant to Chapter 504 of the Act and a Texas
non-profit corporation, and it successors and assigns. For purposes of this Agreement,
EDC's address is 6800 Main Street, The Colony, Texas 75056.
(h) Effective Date. The words "Effective Date" mean May 15, 2012.
(i) Facility. The word "Facility" has the same meaning as defined in the Final Project and
Reinvestment Zone Financing Plan for Tax Increment Reinvestment Zone Number One,
City of The Colony, Texas, approved by the City Council on November 15, 2011,
0) NF 4!J Advances. The words "NFM Advances" mean the funds advanced by NFM
Services to or on behalf of the City and/or the EDC to pay project Costs allocable to the
Warehouse Distribution Facilities and Warehouse Public Improvements,
(k) NF Services. The words "NFM Services" mean NFM Services, lLC, a Texas limited
liability company, its successors and assigns whose address for purposes of this
Agreement is 700 S. 72nd Street, Omaha, NE 68114.
(1) Private Debt. The words "Private Debt" is defined in the Type A Performance
Agreement to mean bonds, notes, loans, or other forms of indebtedness issued or obtained
by an entity other than the EDC to pay Project Costs, and secured by a collateral
assignment of funds paid from the Type A Reimbursement Account.
(m) Project. The word "Project" means one or more projects authorized by the Act to be
undertaken and financed by the EDC, the intent being to liberally interpret the terra to
maximize the purposes for which Type A Sales Tax Revenues may be used. A Project
may include, to the extent permitted by law, but is not limited to, projects authorized by
Section 501.101 of the Act, including land, buildings, equipment, facilities, expenditures,
targeted infrastructure, and improvements for the creation or retention of Primary Jobs
and found by the Board to be required or suitable for the development, retention, or
expansion of a regional corporate headquarters facility, a distribution center, warehouse
facilities, transportation facilities, and related parking facilities for Primary Job
employers. A Project may also include, to the extent permitted by law, but is not limited
to, projects authorized by Section 501.103 of the Act, which authorizes expenditures
found by the Board to be required or suitable for infrastructure necessary to promote or
develop new or expanded enterprises, limited to streets and roads, rail spurs, water and
sewer utilities, electric utilities, or gas utilities, drainage, site improvements (including
on-site parking facilities), and related improvements, as well as telecommunications and
internet improvements. For purposes of this definition, a "corporate headquarters
facility" means buildings proposed for construction or occupancy as the principal office
for a business enterprise's administrative and management services.
(n) Project Costs. The words "Project Costs" mean capital costs of the Project approved by
the EDC, and as further described in the Type A Performance Agreement. Project Costs
are intended to include Soft Costs paid or incurred on or after September 16, 2011, except
for preliminary expenditures meeting the exception described in Section 1.150-2(f)(2) of
the Treasury Regulations that are paid or incurred on or after January 1, 2011.
(o) :Property. The word "Property" means the property defined by metes and bounds in the
Type A Performance Agreement to include approximately 433.81 acres of undeveloped
land on which the Facility will be located.
(p) Soft Costs. The words "Soft Costs" mean capital costs that are allocable to the
Warehouse c& Distribution Facilities and Warehouse Public Improvements and are
approved by the EDC including, but not limited to, an allocable portion of the capital
costs related to. (1) site selection (including, but not limited to, market studies, economic
and feasibility analyses, financial modeling, preliminary engineering, and preliminary
design); (2) the acquisition of property (including, but not limited to, real estate
commissions, title insurance premiums, and the costs to prepare and review title reports,
surveys, engineering and geotechnical data, and environmental assessments); (3)
engineering, architectural, design, and other professional and consulting services; (4)
accounting, audit, appraisal, and related financial services, (5) telecommunications
studies; (6) bond validation litigation fled pursuant to Chapter 1205, Texas Government
Code, including all costs associated with obtaining the Bond Validation Final Judgment;
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(7) costs of issuance of Private Debt and/or Bonds; (S) permits and inspections; (9)
Project, construction, and contract management and consulting; (10) travel eligible to be
capitalized pursuant to generally acceptable accounting principles, transportation,
lodging, and meals; and (11) legal services in support of all of the foregoing activities.
(q) State Comptroller. The words "State Comptroller" mean the Office of the Texas
Comptroller of Public Accounts, or any successor agency.
(r) Term. The word "Term" means the term of this Agreement as specified in Section 2 of
this Agreement.
(s) Type A Performance Agreement. The words "Type A Performance Agreement" mean
the agreement entered into by and between the ED C, TXFM, and LMC on November 15,
2011, and approved by the City Council.
(t) Type A Reimbursement Account. The words "Type A Reimbursement Account" mean
the special account created or to be created by the City or the .EDC into which Type A
Sales Tax Revenues are deposited in accordance with Sections 5 and 6 of the Type A
Performance Agreement from which Project Costs are reimbursed or paid.
(u) Type A Sales Tax Revenues. The words "Type A Sales Tax Revenues" mean the
proceeds of the Type A Sales Tax (the one-half of one percent (0.5%) sales and use tax
on taxable sales and services within the City that, pursuant to the procedures prescribed
in the Act, the voters within the City authorized for levy and collection on behalf of the
EDC for its corporate purposes at an election conducted on January 17, 1998) that are
actually received by the EDC, or by the City on behalf of the EDC from the State
Comptroller, from the levy and collection of the Type A Sales Tax from and after
November 15, 2011, on or with respect to taxable sales and transactions that occur only
within the Property.
(v) Warehouse & Distribution Facilities. The words "Warehouse & Distribution
Facilities" means the approximately 1,280,000 square feet: within the Facility that will be
used for warehouse and distribution purposes.
(,A,) Warehouse Public Improvements. The words "Warehouse Public Improvements"
means the public infrastructure and public improvements that are required or suitable to
promote or develop the Warehouse & Distribution Facilities.
SECTION 4. AFFIRMATIVE OBLIGATIONS.
The parties covenant and agree with each other that, while this Agreement is in effect, it
shall comply with the following terms and conditions.
(a) City Reimbursements. In the event the first series of Bonds has not been issued by
August 31, 2012, the City shall give written notice to NFM Services of the Project Costs
paid or incurred by the City or the EDC as of such date and allocable to the Warehouse &
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Distribution Facilities and Warehouse Public Improvements for which the City or the
EDC is entitled to reimbursement from Type A Sales Tax Revenues deposited into the
Type A Reimbursement Account but for which the City or the EDC has not been
reimbursed. The notice from the City shall include an accounting of the Project Costs
eligible for reimbursement, and NFM Services shall pay the reimbursement amount
within thirty (30) days after receiving Notice from the City. Amounts paid by NFM
Services to the City or the EDC pursuant to this Section shall be reimbursed as NFM
Advances.
Thereafter, to the extent Bonds are not issued after August 31, 2012 or to the extent Bond
proceeds have been exhausted, the City may, at its option, on each June 30,
September 30, December 31, and March 31, give written notice to NFM Services of the
Project Costs paid or incurred by the City or the ITC as of such dates and allocable to
the Warehouse & Distribution Facilities and Warehouse Public Improvements for which
the City or the EDC is entitled to reimbursement from Type A Sales Tax Revenues
deposited into the Type A Reimbursement Account but for which the City or the EDC
has not been reimbursed. The notice from the City shall include an accounting of the
Project Costs eligible for reimbursement, and NFM Services shall pay the reimbursement
amount within thirty (30) days after receiving Notice from the City. Amounts paid by
NFM Services to the City or the EDC pursuant to this Section shall be reimbursed as
NFM Advances.
(b) Performance. The City, EDC, and NFM Services agree to perform and comply with all
terms, conditions, and provisions set forth in this Agreement and in all other instruments
and agreements between the City, EDC, and NFM Services.
SECTION S$ EVENTS C , . ~ AULT.
(a) If a party fails to perform any material obligation rewired by this Agreement, the other
party may give written notice of such failure to the non.-performing Party, which notice shall
describe in reasonable detail the nature of the failed obligation. If the non-performing party
does not cure or remedy the failed obligation within a reasonable period of time after the
notice is given (taking into consideration the nature of the failed performance; but in no
event more than thirty (30) days after the notice is given), then the non-performing party
shall be in "Default" under this Agreement.
(b) In addition to Defaults described in Section S(a), NFM Services shall be in Default under
this Agreement if NFM Services becomes delinquent in the payment of any ad valorem
taxes or sales taxes owed to the City and such delinquencies, including penalties and
interest, are not paid in full within sixty (60) days after written notice of such delinquencies
is given. If NFM Services is in Default under this Section S(b), the City may pursue any
remedies available at law or in equity (excluding termination of this Agreement) including,
but not limited to, exercise of the right of off set against any amounts to which NFM
Services is entitled under this Agreement.
1775.01M6857.2
(c) Except as provided in Section 5(b), if NFM Services is in Default under this Agreement, the
sole and exclusive remedy of the City is to enforce specific performance of this Agreement..
(d) If the City or the EDC is in Default; the sole and exclusive remedies of NFM Services are
to: (1) enforce specific performance of this Agreement; and (2) exercise any rights recorded
against the Property to secure performance by the City or the EDC under this Agreement,
including, rights under any (a) covenants, conditions and restrictions; (b) easements; (c)
conveyance documents that include a determinable interest, reversion or other similar right;
or (d) a deed of trust to secure performance.
(e) No Default by any Party shall entitle any other Party to terminate this Agreement.
SECTION 6. MISCELLANEOUS PROVISIONS.
The following miscellaneous provisions are a part of this Agreement:
(a) Amendments. This Agreement constitutes the entire understanding and agreement of the
parties as to the matters set forth in this Agreement. No alteration of or amendment to
this Agreement shall be effective unless given in writing and signed by the party or
parties sought to be charged or bound by the alteration or amendment.
(b) Applicable Earn and Venue. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas, and all obligations of the parties created
hereunder are performable in Denton County, Texas. Venue for any action arising under
this Agreement shall lie in the state district courts of Denton County, Texas.
(c) Assignment. NFM Services has the right to assign this Agreement, in whole or in part,
and any of its right, title, or interest in or to this Agreement, to the same extent and in the
same manner provided to the "Developer" under the Type A Performance Agreement.
Neither the City nor the EDC may assign this Agreement or any of their respective right,
title, or interest in or to this Agreement without the prior written consent of NF
Services.
(d) F' ng Obligation. This Agreement shall become a binding obligation on the
signatories upon execution by all signatories hereto. City warrants and represents that the
individual executing this Agreement on behalf of City has full authority to execute this
Agreement and bind City to the same. NFM Services warrants and represents that the
individual executing this Agreement on NFM Services' behalf has full authority to
execute this Agreement and bind it to the same,
(e) Caption Readings, Caption headings in this Agreement are for convenience purposes
only and are not to be used to interpret or define the provisions of the Agreement.
(f} Counterparts, This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original and all of which shall constitute one and the same
document.
1775.01N26857,2
(g) Execution of Agreement. The Board of Directors of the EDC shall authorize the
execution of this Agreement on behalf of the EDC.
(h) Force Maieure. It is expressly understood and agreed by the parties to this Agreement
that if the performance of any obligations hereunder is delayed by reason of war, civil
commotion, acts of God, inclement weather, fire or other casualty, or court injunction, the
party so obligated or permitted shall be excused from doing or performing the same
during such period of delay, so that the time period applicable to such obligation or
requirement shall be extended for a period of time equal to the period such party was
delayed.
(i) Notices. Any notice or other communication required or permitted by this Agreement is
effective when in writing (i) and personally delivered by any nationally recognized
delivery service such as FedEx or UPS, or (ii) three (3) days after the Notice is deposited
with the U.S. Postal Service, postage prepaid, certified with return receipt requested, and
addressed as follows or, in the case of a change of address, as provided in a notice
notifying the other Parry of such address change.
To NFM Services:
NFM Services, LLC
Attn: Doug Hamlin
700 S. 72nd Street
Omaha, NE 68114
With a copy to: Glast, Phillips & Murray
Attn: Thomas Rosen
14801 Quorum Drive, Suite 500
Dallas, TX 75254
Shupe Ventura Lindelow & Olson, PLLC
Attn: Misty Ventura
9406 Biscayne Blvd.
Dallas, TX 75218
To the EDC: The Colony Economic Development Corporation
Attn: Keri Samford
6800 Main Street
The Colony, Texas 75056
With a copy to: Brown and Hofrneister, LL.P
Attn: Jeff Moore
740 East Campbell Road, Suite 800
Richardson, TX 75081
To the City: The City of The Colony, Texas
Attn: Troy Powell, City Manager
1775.010126857.2
6800 Main Street
The Colony, Texas 75056
With a copy to: Brown and Hofineister, LLP
Attn: Jeff Moore
740 Bast Campbell load, suite 800
Richardson., TX 75081
everailitya If a court finds any provision of this Agreement to be invalid or
unenforceable as to any person or circumstance, such finding shall not render the
provision invalid or unenforceable as to any other persons or circumstances. To the
extent feasible, any provision found to be invalid or unenforceable shall be deemed to be
modified to be valid and enforceable; however, if the provision cannot be so modified, it
shall be stricken from this Agreement, and all other provisions of this Agreement shall
remain valid and enforceable and unaffected by the stricken provision,
(k) singular and Plural. Where the context permits, words used in the singular also include
the plural and vice versa, and the definitions of such words in the singular also apply to
such words when used in the plural and vice versa.
(1) Time is of the Essence. Time is of the essence in the performance of this Agreement.
[The Remainder of this Page Intentionally Left Blank]
THE PAN'T'IES ACKNOWLEDGE HAVING AD ALL THE ` )VI IO OF THIS
AGREEMENT, AND THE PARTIES AGREE TO IT TERMS. 'I - ) AGREEMENT IS
DATED AS OF EFFECTIVE AS OF THE EFFECTIVE DA'l[`]E AS DEiINED HEREIN.
F SERVICES:
NFM SERVICES, LL C,
a Texas limited liability company
-
By.
Jeff L -#r lent
late:
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EDP'.
ATTEST:
Ferri rnonije, Secretary
1775.01 0126$57.2
CITY:
C'ITE' OF THE COLONY, TEXAS,
a Texas horrne-rule municipality
By:
J e McCo , Mayor
Da : -/mss
ATTEST:
Christie Wilson, City Secretary
APPROVFT) AS TO FORM:
Jeff Moore" ity I ttorney
t775,01O 6857.2