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CONTRACT NO.
SECOND RATIFICATION AND AMENDMENT OF PURCHASE CONTRACT
THIS SECOND RATIFICATION AND AMENDMENT OF PURCHASE CONTRACT
("Ratification and Amendment") is made and entered into by and between the CITY OF FORT
WORTH, TEXAS, acting by and through its duly authorized City Manager or Assistant City Manager
("Seller"), and FORT WORTH SOUTHSIDE DEVELOPMENT DISTRICT, INC. dba FORT
WORTH SOUTH, INC., a Texas non-profit corporation ("Purchaser"), as of the date on which this
Second Ratification and Amendment is executed by the last to sign of Seller and Purchaser ("Effective
Date").
RECITALS
A. Seller and Purchaser entered into a Purchase Contract (City Secretary Contract No.
28494) dated as of March 27, 2003, and subsequently amended by a First Amendment to Purchase
Contract (collectively, the"Contract") for the sale and purchase of the approximately 406,166.80 square
foot tract of land described as Lot IA, Block 6R, Mistletoe Heights Addition to the City of Fort Worth,
Tarrant County, Texas, which is situated at the northeast corner of Forest Park Boulevard and Rosedale
Street in Fort Worth, Texas, together with any easements, rights-of-way, licenses, interests, and rights
appurtenant thereto(collectively, the"Property").
B. Purchaser is a non-profit corporation organized to promote the social welfare, within the
meaning of Internal Revenue Code Section 501(c)(4), of the people and businesses in the Southside
Medical District area of Fort Worth, Texas, by promoting and assisting in the improvement of the
economy, employment opportunities, and residential and business quality of life in that area.
C. In May 2005, Purchaser requested that Seller agreed to ratify and reinstate the contract
that had expired in 2004 and amend the contract. The Ratification and Amendment ("First Ratification
and Amendment') as approved by Seller in June 2005 (M&C C-21183) (City Secretary Contract Number
32174). The First Ratification and Amendment expired on November 1, 2005.
D. Despite such termination, the Title Company continues to hold the Earnest Money
(including any Additional Earnest Money)of$40,616.68.
E. Purchaser has requested that Seller Ratify and extend the Original Purchase Agreement
with a small number of Amendments.
F. Purchaser is now willing to reinstate the Contract and to proceed with the purchase of the
Property with the amendments to the Purchase Agreement on an AS IS basis without representation once
certain contract contingencies are satisfied.
G. Except as otherwise defined herein, all of the defined terms in this Second Ratification
and Amendment have the same meanings given to those terms in the Contract.
AGREEMENT
In consideration of the mutual covenants in this Second Ratification and Amendment, Seller and
Purchaser agree as follows:
1. Ratification of Contract. Seller and Purchaser ratify and reinstate the Contract, as
amended by the First Ratification and Amendment and hereby, as of the Effective Late of this Second
4apl?
Ratification and Amendment and confirm that the foregoing recitals are true and correct in all material
respects.
2. Amendment of Contract. Seller and Purchaser amend the Contract as follows:
A. Purchase Price. Section 2 of the Contract is amended to provide that the
Purchase Price for all of the Property as described in Paragraph 2.A of the First Ratification and
Amendment (other than the TXDOT ROW Tract) is $2,314,966.00. In exchange for the promises,
indemnifications and releases contained in Section B.1 of the First Ratification, the Purchase Price plus
interest shall be reduced by $1,000,000.00. The Purchase Price as reduced will accrue interest at an
annual rate of 6.0%commencing November 1, 2005, and will continue to accrue interest until the date of
closing. The Purchase Price for the TXDOT ROW Tract will be the same purchase price paid by the
Seller to the State of Texas for the Seller's acquisition of the TXDOT ROW Tract, without any markup or
multiplier.
B. Closing Contingencies. Section 7 of the Contract is amended to provide that the
only remaining Closing Contingencies are the following:
(i) Purchaser having obtained all necessary municipal approvals for rezoning of the
Property to Planned Development Special Use-Mixed Use—_with site plan(PDSU -MU-2).
The site plan should be in substantially the same form as shown on the attached EXHIBIT"A".
(ii) Purchaser and Seller having agreed upon the location of a sanitary sewer
easement to be dedicated to Seller, at no cost to Seller, located on or adjacent to the Property;
(iii) Purchaser and Seller having agreed upon either a slope easement along the
northwest boundary of the Property, a retaining wall system in lieu of a slope easement or some
other mutually agreeable accommodation;
(iv) Seller having approved Purchaser's proposed replat of the Property in which the
portion of Jerome Street abutting the Property is abandoned and incorporated into the Property;
(v) Purchaser having entered into an agreement with the City of Fort Worth Tax
Increment Financing District #4 ("TIF #4) regarding infrastructure improvements on or adjacent
to the Property as outlined in a briefing to TIF #4's Board of Directors on February 15, 2005;and
(vi) The Title Objections having been satisfied;
(vii) Purchaser shall enroll the Property into the Texas Commission on Environmental
Quality (TCEQ) Voluntary Cleanup Program (VCP). "Enrollment" shall include but shall not be
limited to submitting the VCP application to TCEQ and paying all required fees; and
(viii) Removal of all of Surmount Corporation's equipment and materials from the
Property and the restoration of the Property to substantially the same condition as it existed on the
day before Surmount Corporation's entry thereon and in a neat, clean, and sanitary condition,
free of all trash, litter, garbage, refuse, and debris.
If these Closing Contingencies are not satisfied to Purchaser's satisfaction so that Purchaser is prepared to
close on or before February 28, 2006, then Purchaser must either (1) terminate the Contract, and upon
such termination Seller shall retain the Earnest Money, and neither party will have any further rights or
obligations hereunder, or(2)extend the period for Closing for a reasonable period up to sixty(60) days to
complete any actions necessary to satisfy the remaining Closing Contingencies. If Purchaser elects the
763634_; 2
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option to extend the period for Closing as set forth in Option (2) above and if the remaining Closing
Contingencies are not satisfied by such extended date, then Purchaser may thereafter elect to terminate the
Contract as provided in Option (1) above.
C. Acquisition of Needed Right-of-Way Purchaser agrees that it will make a good faith
effort to secure the needed right-of-way as shown on the attached EXHIBIT "A" from the adjacent
property owner to establish Midtown Boulevard ("Needed Right-of-Way") and dedicate it as a public
right-of-way. If after six (6) months following the Closing, Purchaser is unable to complete that
transaction and Seller is satisfied that Purchaser has made a good faith effort through reasonable
negotiations to acquire the Needed Right-of-Way at a fair market price, Seller shall exercise its right of
eminent domain to establish the public street so long as allowed by law, as determined by Seller,
following the procedures outlined below.
So long as Sellers determines its exercise of eminent domain is lawful, the Seller must commence
the required legal action no earlier than seven(7)months following the Closing.Purchaser shall pay(i)all
costs for the acquisitions of the Needed Right-of-Way, whether through negotiated sales, through eminent
domain proceedings or otherwise; (ii) all costs that are related to such acquisitions; (iii) all costs for legal
and other professional services related to such acquisitions whether incurred by Seller or by Purchaser,
provided that Purchaser has approved the engagement of such legal and professional services; and (iv) all
costs for litigation related to such acquisition, whether incurred by Seller or Purchaser. Purchaser
acknowledges and agrees that Seller shall not have any responsibility or liability for any cost of acquiring
the Needed Right-of-Way or any other costs related thereto. The procedures for eminent domain will be
as follows:
(i.) Seller will appraise or will cause to be appraised the current fair market value of the
Needed Right-of-Way and will provide Purchaser with written notice of such appraisals.
(ii.) Following Purchaser's receipt of such notice of the current market value of the
Needed Right-of-Way, Purchaser shall deposit an amount equal to one hundred twenty-five
percent (125%) of the fair market value of the Needed Right-of-Way as established by such
appraisals with an escrow agent acceptable to Purchaser and Seller pursuant to an escrow
agreement negotiated by the escrow agent, Purchaser and Seller(the"Escrow Funds").
(iii) After deposit of the Escrow Funds, the City Attorney, representing the Seller, and/or
outside legal counsel retained by the Seller and approved by Purchaser (which approval shall not
unreasonably be delayed or denied), shall use their best efforts to negotiate the terms and
conditions of the purchases of the Needed Right-of-Way by offering the respective owner the fair
market value thereof.
(iv.) If the owner of Needed Right-of-Way rejects the fair market value offer and makes a
higher counteroffer, the Seller shall submit the counteroffer to Purchaser for Purchaser's
approval. Purchaser shall notify the Seller within five (5) business days of its decision regarding
the counteroffer. If Purchaser rejects any counteroffer, the Seller shall proceed to use its best
efforts to acquire the Needed Right-of-Way through eminent domain proceedings.
(v.) If the owner of the Needed Right-of-Way offers to settle outside of the eminent
domain proceeding for an amount in excess of the fair market value offered to such owner, the
Seller shall submit the proposed settlement offer to Purchaser for Purchaser's approval.
Purchaser shall notify Seller within five (5) business days of its decision regarding the
counteroffer. The Seller shall not be authorized to make any settlement without the prior
approval of Purchaser. If Purchaser rejects any proposed settlement, Seller shall continue with
the eminent domain proceeding. , 1
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763634+2 3Ff. MA N, TrAl.
(vi.) Seller will use the Escrow Funds to acquire the Needed Right-of-Way and to pay all
costs associated therewith.
(vii.) If additional funds are needed by Seller to acquire the Needed Right-of-Way,
Purchaser shall deposit the additional funds with the escrow agent within five(5)business days of
receiving written notice from Seller that additional funds are needed.
(viii.) If Purchaser fails to deposit any Escrow Funds with the escrow agent and if such
failure continues for more than ten (10) days after Purchaser's receipt of written notice thereof,
such failure shall constitute a material breach of this Agreement and shall relieve the Seller of any
obligations to Purchaser under this subsection.
D. Closing Date. Section 8 of the Contract is amended to provide that Closing
shall occur on or before February 28, 2006, subject to extension as set forth in Paragraph 2.13. of this
Second Ratification and Amendment. At the Closing, Purchaser shall deliver to Seller the Purchase Price
as adjusted for closing costs and prorations. The Earnest Money (including any Additional Earnest
Money) shall be applied to the Purchase Price at Closing.
E. Survival. The parties agree that the duties and obligation contained in
Section C shall survive the Closing of this Transaction.
F. Contract Construction. The parties acknowledge that each party and, if it so
chooses, its counsel have reviewed and revised this Agreement and that the normal rule of construction to
the effect that any ambiguities are to be resolved against the drafting party must not be employed in the
interpretation of this Agreement or any amendments or exhibits hereto.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
CISH
763634_a2 4 Qg� xy��; Q� Q 71
Except as amended by this Second Ratification and Amendment, all of the terms and conditions of the
Contract, as amended by the First Ratification and Amendment, are ratified and remain in full force and
effect. This Second Ratification and Amendment is executed as of the Effective Date.
SELLER: Attest
CITY OF FORT WORTH
Name: ALS A F Marty Hendri
Assistant City Manager City Secretary
Date: �I 0/Q(O
Approved Form and Legality
Assistant cffy Attorney
Cont-act Authorizatioi
PURCHASER:
Date
FORT WORTH SOUTHSIDE
DEVELOPMENT DISTRICT, INC.
dba FORT WORTH SOUTH, INC.
r_\
Paul Paine,President
Date: 2 - 20-06
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City of Fort Worth, Texas
Mayor and Council Communication
COUNCIL ACTION: Approved on 12/20/2005
CONTINUED FROM A PREVIOUS WEEK
DATE: Tuesday, December 06, 2005
LOG NAME: 17MIDTOWNEXTEND REFERENCE NO.: C-21183
SUBJECT:
Authorization to Amend the Purchase Agreement and Authorize the Sale of City-Owned Property
Located at the Northeast Corner of Forest Park Boulevard and West Rosedale Street to Fort Worth
South, Inc., in Accordance with Section 272 of the Local Government Code
RECOMMENDATION:
It is recommended that the City Council:
1. Authorize the City Manager to amend the Purchase Agreement (Contract No. 28494) with Fort Worth
South, Inc., (Fort Worth South) to extend the option period to February 28, 2006; and
2. Authorize the City Manager to execute an appropriate deed conveying the property to Fort Worth
South, Inc., and record the deed, if the terms of the option agreement as amended are satisfied.
DISCUSSION:
On March 18, 2003 (via M&C L-13515), the City Council authorized the sale of 9.34 acres of property
located at the northeast corner of Forest Park Boulevard and Rosedale Street to Fort Worth South, Inc., for
$2,030,834.00. Fort Worth South, Inc., proposes to build a mixed-use development consisting of a hotel,
retail, office, structured parking, residential and a major anchor totaling 337,000 square feet — total project
costs of over$27 million. This project is known as the Midtown Development.
Pursuant to the closing conditions of the option agreement, Fort Worth South, Inc., (Purchaser) in a joint
venture with Trademark Property Company, has worked to fulfill the terms of the Purchase Agreement). The
Purchaser re-zoned the property in accordance with the Agreement as amended on March 23, 2004, (M&C
C-19999). The amendment extended the option period to May 31, 2004 and specified that the property
would need to be rezoned to MU-2 PDSU with site plan. City Council approved the rezoning request of the
Purchaser on April 13, 2004, (ZC -04-037; PD 558; Ordinance No. 15957). The rezoning and related site
plan (SP-04-016) incorporated an adjacent piece of property that at the time was under option but now is no
longer part of the development program.
Concurrently, the Purchaser conducted a limited Phase II Environmental Assessment of the Property. The
Environmental Assessment, as reviewed by City staff, identified some environmental conditions that need to
be addressed. The agreement was extended on June 29, 2004, (M&C C-20130) to August 20, 2004, in
order to complete the Phase II Environmental Assessment and dilineate remedy options. On May 31, 2005
(via M&C C-20775), the City Council approved amending the Agreement to adjust the purchase price as
follows:
. Add an additional $138,355.00 for the adjacent right-of-way owned by City; thereby, making the purchase
price plus interest $2,314,966.00.
. Subtract $1,000,000 as consideration of the Purchaser purchasing the property "As-Is" and purchaser
http://www.cfwnet.org/council_packet/Reports/mc_print.asp 4/17/2006
Page 2 of 2
indemnifying and holding the City harmless from all liability as a result of the environmental condition of the
property. City staff believes that the $1,000,000.00 represents the cost to clean up the property.
The Agreement expired November 1 2005. A fourth extension will allow the Purchaser to amend the site
plan to bring it in accordance with the correct property ownership and development program. The purchase
price will accrue interest at an annual rate of 6% commencing November 1, 2005 and will continue until the
date of closing. This accrued interest will be added to the purchase price at closing. The proceeds from the
sale will be deposited into the Capital Projects Reserve Fund. The Agreement will expire on February 28,
2006.
This property is located in COUNCIL DISTRICT 9, MAPSCO 76K, MAGNOLIA VILLAGE NEIGHBORHOOD
EMPOWERMENT ZONE.
FISCAL INFORMATION/CERTIFICATION:
The Finance Director certifies that the Engineering Department, Real Property Division, is responsible for
collection and deposit of funds for this sale.
TO Fund/Account/Centers FROM F u nd/Accou nt/C enters
GG10 444552 013010001000 $1,212,573.00
Submitted for City Manager's Office by- Dale Fisseler (6140)
Originating Department Head: Tom Higgins, Director (6192)
Additional Information Contact: Christine Maguire (8187)
http://www.cfwnet.org/council_packet/Reports/mc_print.asp 4/17/2006