HomeMy WebLinkAboutContract 33089 CITY SECRETARY � %)� ' c��
CONTRACT NO.
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LICENSE AND OPTION AGREEMENT
THE STATE OF TEXAS §
COUNTY OF TARRANT §
THIS License and Option Agreement ("License") 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 ("City") and 11211 Katy Freeway, L.P. a Texas Limited
Partnership ("Licensee") as of the date on which this Agreement is executed by the last to sign
of City and Licensee ("Effective Date").
RECITALS
WHEREAS, City has entered into a Purchase Agreement with Licensee to sell
approximately 1.266 acre tract of land and building located as 1500 North Main Street and
more particulary described as property located in the John Baugh Survey, Abstract No. 115 and
being all of Lots 1R and 2R, Block 216, North Fort Worth Addition, an addition to the City of
Fort Worth, Tarrant County, Texas according to the plat recorded in Cabinet B, Slide 2589, Plat
Records Tarrant County, Texas, together with any easements, rights-of-way, licenses, interests,
and rights appurtenant thereto, except any mineral interests (collectively, the "Mercado
Property"), and as more particulary described on the attached Exhibit "A".
WHEREAS, when the City finished the construction of the Fort Worth Mercado ("Fort
Worth Mercado"),the City's desired that the Fort Worth Mercado be operated as a Hispanic-
themed marketplace marketplace that would serve the community and would be operated and
used as follows: retail on the fust floor, office/retail on the second floor and a banquet
hall/meeting room on the third floor in addition to allowing four Hispanic-themed events to be
held in the Facility or on the Property per year("City's Vision");
WHEREAS, in exchange for the City executing this License Agreement to allow
Licensee additional parking on the adjacent city-owned property(`Remainder Parking Lot")
located in the John Baugh Survey, Abstract No. 115 and being all of Lot 3R, Block 216, North
Fort Worth Addition, an addition to the City of Fort Worth, according to the plat recorded in
Cabinet B, Slide 2589, Plat Records Tarrant County, Texas and as shown on Exhibit `B"
attached hereto, Licensee has agreed to operate the Property according to the City's Vision.
NOW, THEREFORE, for and in consideration of operating the Property according to
the City's Vision, and other good and valuable consideration paid, the receipt and sufficiency of
which are hereby acknowledged, the parties agree as follows:
1. GRANT OF LICENSE. City, as owner of the Remainder Property , does hereby grant
unto the Licensee, its legal representatives and successors, a nonexelusiyc-I.- c
(hereinafter referred to as the "License") for the temporary parking of the patrons of the
Fort Worth Mercado; subject, however, to the covenants herein set forth, all of which
shall be covenants running with the Property.
2. OPTION. As set forth in the Purchase Agreement, and in consideration of Licensee
paying the City an option fee of $1,000.00, City hereby grants Licensee an option (the
"Option"), pursuant to and subject to the conditions of this section, to purchase the
Remainder Parking Lot from City for the fair market value at the time of purchase as
determined by an Independent Appraiser jointly selected by City and Licensee. In order
for Licensee to exercise its Option to purchase the Remainder Parking Lot, Licensee must
not be in default of this Agreement, and the closing documents will contain a provision
pursuant to which the public will have the ability to park in the Remainder Parking Lot,
after regular business hours, in order to in order to attend scheduled events at the Rose
Theatre, located near the Remainder Parking Lot.
3. TERM. The License will expire in 99 years or earlier if terminated under the provisions
in the Termination Section of this Agreement, or by Licensee's exercise of it Option to
purchase under Section 2.
4. NON-EXCLUSIVITY. The License and other rights and benefits herein created are
exclusive, subject to the following reservation: during the Term of the Agreement,
Licensee agrees to allow members of the public to park for free in the Remainder Parking
Lot, after regular business hours, in order to attend scheduled events at the Rose Theatre,
located near the Remainder Parking Lot, or to patronize businesses located within a two
(2)block radius of the Remainder Parking Lot.
5. CONSIDERATION.In consideration of City granting this License to Licensee,
Licensee shall
A. lease and operate the Remainder Parking Lot in accordance with Section 5; and
B. be solely responsible for all maintenance and upkeep of the Remaining Parking
Lot.
6. OPERATION AND USE OF THE PROPERTY
A. Licensee agrees to operate and lease space in the Fort Worth Mercado as follows:
retail on the first floor,office/retail on the second floor and a banquet hall/meeting
room on the third floor.
B. "Retail Use" shall include, any businesses which sell goods to the public,
businesses that provide community services to the public including but not limited
to restaurants, medical and dental services, legal services, financial services, real
estate services and banks. Licensee agrees that a mix of retail use will be offered
on the first floor.
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C. Licensee agrees to hold or sponsor at least four Hispanic-themed events in the
Fort Worth Mercado per year. "Hispanic-themed event" is defined as a Hispanic-
themed art shows, live musical performances, live dance performances or live
poetry readings. In addition, "Hispanic themed event shall include community
festivals on the Remainder Parking Lot. Licensee has represented to City that it
will coordinate the four events with the Fort Worth Hispanic Chamber
("Chamber") or the Latin Arts Association ("LAA") and Licensee agrees to use
its best efforts to coordinate the events with the Chamber and the LAA. The
failure of Licensee to meet the provisions of Section 6 shall be an event of
default, which may result in termination unless cured as provided in Section 11.
D. City agrees that it will not construct any improvements on the Remainder Parking
Lot, or take any action which reduces the amount of spaces available in the
Remainder Parking Lot, unless at Licensee's request.
7. MAINTENANCE RESPONSIBILITY. Licensee shall be solely responsible for the
maintenance and upkeep of the Remainder Parking Lot.
8. INSURANCE. Licensee shall not allow its patrons or tenants to park in the Remainder
Property until it obtains the following insurance coverage and shown proof of such
coverage to City:
A. Commercial General Liability(CGL) Insurance Policy
$1,000,000 each occurrence
$2,000,000 aggregate limit
B. POLICY REQUIREMENTS
i. City, its Officers, Employees and Volunteers shall be named as an Additional
Insured.
ii. Forty-five (45) days notice of cancellation or non-renewal must be given to
City. The following clause is required: "This insurance shall not be canceled,
limited in scope or coverage, cancelled or non-renewed, until after forty-five
(45) days prior written notice has been given to City."
iiL The insurers for all policies must be licensed/approved to do business in the
State of Texas and have a minimum rating of A: VII in the current A. M.
Best Key Rating Guide or have reasonably equivalent financial strength and
solvency to the satisfaction of City.
8. INTERFERENCE. The License granted shall be used and enjoyed in such a manner as
to cause the least possible interference with the conduct and operation of the Remainder
Parking Lot,or any portion thereof.
9. NO HAZARDOUS OR TOXIC SUBSTANCES. Under no circumstances during the
term of this License shall Licensee use or cause to be used any hazardous or toxic
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substances or materials, or store or dispose of any such substances or materials on the
Remainder Parking Lot.
10. LIENS. Licensee will not cause or permit any mechanics' liens or other liens to be filed
against the Remainder Parking Lot by reason of any work, labor, services, or materials
supplied or claimed to have been supplied to Licensee. If such a mechanic's lien or
materialman's lien is recorded against the Remainder Parking Lot, City must either cause
it to be removed or, if City in good faith wishes to contest the lien, take timely action to
do so, at City's sole expense.
11. DEFAULT AND TERMINATION.
A. Event of Default. Owner shall be in default of this Agreement if (i) any of the
covenants set forth in any portion of this Agreement are not met ("Event of
Default").
B. Notice to Cure. If the City determines that an Event of Default has occurred, the
City shall provide a written notice to Licensee that describes the nature of the
Event of Default. Licensee shall have ninety (90) calendar days from the date of
receipt of this written notice to fully cure or have cured the Event of Default. If
Licensee reasonably believes that Licensee will require additional time to cure the
Event of Default, Licensee shall promptly notify the City in writing, in which case
(i) after advising the City Council in an open meeting of Licensee's efforts and
intent to cure, Licensee shall have one hundred eighty (180) calendar days from
the original date of receipt of the written notice to cure.
C. Termination for Event of Default. If an Event of Default has not been cured
within the time frame specifically allowed under subsection B, the City shall have
the right to terminate this Agreement immediately.
D. Termination at Will. If the City and Licensee mutually determine that the
continuation of the License is re no longer appropriate or feasible, or that a higher
or better use is preferable, the City and Owner may terminate this Agreement in a
written format that is signed by both parties. In this event, (i) if the Term has
commenced,the Term shall expire as of the effective date of the termination of this
Agreement; (ii) there shall be no recapture of any taxes previously abated; and (iii)
neither party shall have any further rights or obligations hereunder.
12. INDEMNIFICATION.
LICENSEE, AT LICENSEE'S OWN EXPENSE, SHALL INDEMNIFY, DEFEND (WITH
COUNSEL REASONABLY ACCEPTABLE TO THE INDEMNIFIED PARTIES HEREIN)
AND HOLD HARMLESS THE CITY, ITS OFFICERS, AGENTS, SERVANTS,
EMPLOYEES AND CONTRACTORS, FROM AND AGAINST ANY CLAIM, LAWSUIT OR
OTHER ACTION FOR DAMAGES OF ANY KIND, INCLUDING, BUT NOT LIMITED TO,
PROPERTY LOSS, PROPERTY DAMAGE AND/OR PERSONAL INJURY OF ANY KIND,
INCLUDING DEATH, TO ANY AND ALL PERSONS, OF ANY KIND OR CHARACTER,
WHETHER REAL OR ASSERTED, TO THE EXTENT(i) CAUSED BY THE NEGLIGENT
OR WILLFUL ACT(S) OR OMISSION(S) OF LICENSEE, ITS OFFICERS, AGENTS,
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SERVANTS, EMPLOYEES, CONTRACTORS AND/OR SUBCONTRACTORS, AND (ii)
ARISING OUT OF, OCCASIONED BY OR RELATED TO THE PERFORMANCE OF
THIS AGREEMENT.
13. EFFECT OF SALE OF PROPERTY.
The License granted hereunder shall vest only in Licensee and cannot be assigned to a new
owner of all or any portion of the Mercado Property without the prior consent of the City Council,
which consent shall not be unreasonably withheld provided that (i) the City Council finds that the
proposed assignee is committed to operating the Fort Worth Mercado in accordance with the City's
Vision and (ii) the proposed assignee agrees in writing to assume all terms and conditions of this
Agreement. Licensee may not otherwise assign, lease or convey any of its rights under this
License Agreement. Any attempted assignment without the City Council's prior consent shall
constitute grounds for termination of this License Agreement granted hereunder following ten(10)
calendar days of receipt of written notice from the City to Licensee. Any attempted assignment to
a person or entity that does not own the Mercado Property shall be void.
14. NOTICES.
All written notices called for or required by this Agreement shall be addressed to the
following, or such other party or address as either party designates in writing, by certified mail,
postage prepaid,or by hand delivery:
City: Licensee:
City of Fort Worth 11211 Katy Freeway, L.P.
Attn: City Manager Attn:Andrew Segal
1000 Throckmorton 2650 Fountainview, Suite 400
Fort Worth, TX 76102 Houston,Texas 77057
Telephone: 719-777-7368
with copies to:
the City Attorney and
Economic/Community Development
Director at the same address
15. GOVERNING LAW. This Agreement shall be construed in accordance and governed
by Federal Law and any applicable laws of the State of Texas.
1.6. 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
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party must not be employed in the interpretation of this Agreement or any amendments or
exhibits hereto.
17. NO THIRD-PARTY BENEFICIARIES. This Agreement shall inure only to the
benefit of the parties hereto and third persons not privy hereto shall not, in any form or
manner, be considered a third party beneficiary of this Agreement. Each party hereto
shall be solely responsible for the fulfillment of its own contracts or commitments.
18. SEVERABILITY. The provisions of this Agreement are severable, and if any word,
phrase, clause, sentence, paragraph, section or other part of this Agreement or the
application thereof to any person or circumstance shall ever be held by any court of
competent jurisdiction to be invalid or unconstitutional for any reason, the remainder of
this Agreement and the application of such word, phrase, clause, sentence, paragraph,
section, or other part of this Agreement to other persons or circumstances shall not be
affected thereby and this Agreement shall be construed as if such invalid or
unconstitutional portion had never been contained therein.
19. VENUE AND JURISDICTION. If any action, whether real or asserted, at law or in
equity, arises on the basis of any provision of this Agreement, venue for such action shall
lie in Tarrant County. This Agreement shall be construed in accordance with Federal law
and any applicable laws of the State of Texas.
20. COMPLIANCE WITH LAW. Licensee, its officers, agents, employees, contractors
and subcontractors, shall abide by and comply with all laws, federal, state and local,
including the Charter and all ordinances, rules and regulations of the City. It is agreed
and understood that, if City calls the attention of Licensee to any such violations on the
part of Licensee, its officers, agents, employees, contractors or subcontractors, then
Licensee shall immediately desist from and correct such violation.
21. GOVERNMENTAL POWERS. It is understood that by execution of this Agreement,
the City does not waive or surrender any of it governmental powers.
22. COUNTERPARTS. This Agreement may be executed in several counterparts, all of
which when taken together shall constitute one and the same agreement.
[Sisnatures on Followine Patel
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IN WITNESS WHEREOF, the parties have executed this Agreement to be effective as of
the date first above written in Fort Worth, Tarrant County, Texas.
11211 Katy Freeway, L.P. a Texas
Limited Partnership,
By: 11211 Katy Property, Inc., its general
partner -
By:
Printed Name: c
Title:
CITY OF FORT WORTH
Assistant City M ag
APPRO ED AS TO FORM
7
Assist t i y Attorney
ATTEST:
POP71i C ty Secretary
contract, Author'aatfon
L 1— c—L.�(
Date
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ACKNOWLEDGMENT
STATE OF -TEM-5 §
COUNTY OF H"15 §
00(0
On this f� day of 2eft, before me personally
appeared Wrw 5 ad , to Jie personafty known, who, being by me duly sworn,
did say that he is , and that the foregoing instrument was signed
on behalf of said Lftity, and further acknowledged said instrument to be the free aft and deed of
said eiy: Plesicl�ev�" 4 [(2-(( i -1�-^� . q�vlQY q^et' o
J 11z�1 l�a�y
IN TESTIMONY WHEREOF, I have hereunto set my hand and affixed my official sea /G
in the City and State aforesaid, the day and year first above written. !
LINDA SHAMIS
SEAL _ � Notary Public,State of Texas
**�� My Commission Expires
'•'.;,;, �,;;.� May 13,2009 Notary Public
ACKNOWLEDGMENT
STATE OF TEXAS §
COUNTY OF TARRANT §
This instrument was acknowledged before me on j — /8- D 6 , 2005,
by yJctlls �, fthe City
of Fort Worth, on behalf of the City of Fort Worth
HETTJESANE
Mrc
fISbipN FXp1RE Notary Public, State of Texas
dui!Y 23, ; ,.
8
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Exhibit "A"
PROPERTY DESCRIPTION
BEING a tract of land situated in the John Bough Survey, Abstract No. 115 and being all of,
Lots IR and 2R, Block 216, North Fort Worth Addition an addition to the City of Fort Worth
according to the plat recorded in Cabinet B, Slide 2589, Plot Records, Tarrant County, Texas
and being more particularly described by metes and bounds as follows:
BEGINNING at a point for the southwest corner of said Lot IR, Block 216 and being the
intersection of the east right—of—way line of North Main Street (100 foot right—of—way) and
the north right—of—way line of Northeast 14th Street (60 foot right—of—way);
THENCE North 30'00'00' West, with the east right—of—way line of said North Main Street, a
distance of 400.00 feet to an 'X' cut in concrete found for the northwest corner of said
Lot 1 R, Block 216;
THENCE North 60'00'00" East, with the north line of said Lot 1 R and the south line of Lot
XKT1, Block 216, an addition to the City of Fort Worth, according to the plot recorded in
Volume 106, Page 131, Plat Records, Torrant County, Texas, passing at 108.5 feet a point
for the southeast corner of said Lot 1 and continuing with the north line of said Lot 1 R
and the south and of a 10 foot alley in all 118.50 feet to a 5/8 inch iron rod with cap
stamped "Dunaway Assoc. Inc" set (hereinafter called 5/8 inch iron rod set);
THENCE North 30`00'00" West, with the east line of a 10 foot alley, a distance of 25.58
feet to a PK Nail w/shiner stamped "Dunaway Assoc. Inc. found in the south right—of—way
line of Northeast 20th .Street. same being in the north line of said Lot 1R;
THENCE EAST. with the south right—of—way line of said Northeast 20th Street, a distance of
30.97 feet to a 5/8 inch iron rod set;
THENCE South 24!04'43" East, deporting said south right—of—way line, a distance of 55.03
feet to an "X" cut in concrete found;
THENCE South 30'00'00' East, a distance of 273.08 feet to an 'X' cut in concrete found;
THENCE South 42'07'57" East. 58.00 feet to a 5/8 inch iron rod with yellow cap stamped
'Dunaway Assoc. Inc." found in the north right—of—way line of aforementioned Northeast 14th
Street, from which a reference Y cut in concrete walk found bears North 50'26'17' East, a
distance of 512.75 feet;
THENCE South 50'26'17" West, with the north right—of—way line of said Northeast 14th
Street, a distance of 153.97 feet to the POINT OF BEGINNING and containing a calculated
area of 55,148 square feet or 1.266 acres of land.
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.Ito the plot T.—ded I.V.I.M. 106,Page 131,Plat Records,T.Trant County,
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=—a— ---c. Texas, and a tract of land de,cribed eA Tract 11 In the dead to The City of
Fort Worth,recorded in Volume 11860, Page 1760, Deed Records.Tarrant
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0-5-029
Page 1 of 2
City of Fort Worth, Texas
Mayor and Council Communication
COUNCIL ACTION: Approved on 1/10/2006
DATE: Tuesday, January 10, 2006
LOG NAME: 17MERCADO REFERENCE NO.: L-14158
SUBJECT:
Authorize the Sale of City-Owned Property Located at 1500 North Main Street to 11211 Katy
Freeway, L.P. in Accordance with Section 272 of the Texas Local Government Code
RECOMMENDATION:
It is recommended that the City Council:
1. Authorize the City Manager to execute a contract agreement to sell property located at 1500 North
Main Street to 11211 Katy Freeway, L.P. ("Katy Freeway") in accordance with Chapter 272 of the Texas
Local Government Code.
DISCUSSION:
The City owns approximately 3.1 acres of property located at 1500 North Main Street. In 2002, the City
entered into an agreement to finance the construction of a 58,000 square foot facility on 1.26 acres of the
property. The Remainder Lot of 1.9 acres continued to serve as public parking for the Rose Theater and
adjacent businesses.The three-story building has space for retail and office, while the third floor is designed
to serve as a banquet halllmeeting space for the neighborhood. The project was partially funded by a $3.1
million Section 108 loan provided through the City. The original developer lost their private financing on the
project and all rights were assigned to the City in August 2004. In addition to the Section 108 loan, the City
allocated an additional $1.3 million to complete the project. City staff was directed by City Council to identify
a buyer for the facility as soon as construction was completed.
Purchase price: 11211 Katy Freeway, L.P,, (the Buyer) has agreed to pay $2,500,000.00 for the property.
Within one day of contract execution, the Buyer will deposit $700,000.00 with the title comapny as earnest
money which will be applied to the purchase price. The remaining balance of$1,800,000.00 will be paid to
the City upon closing. The City will maintain all mineral interests in the property. The Buyer will close on the
property no later than January 20, 2006 contingent upon execution of a non-exclusive License Agreement
as decribed below..
Parking: The City will grant to the Buyer an option to acquire all or any of the Remainder Lot at the Fair
Market Value for an option fee of $1,000.00. In order to exercise the option, Buyer must execute a 99 year
License Agreement with the City that allows members of the public to park free in the Remainder Lot after
regular business hours to attend events at the Rose Theater or patronize businesses located within a two
block radius of the Remainder Lot. The Buyer's option to purchase will continue until December 31, 2044.
The Buyer will be solely responsible for the maintenance and upkeep of the Remainder Lot. The City
agrees to not build any additional development on the Remainder Lot unless at Buyer's request.
Jobs: The Buyer agrees to use good faith efforts, through negotiations with tenants, to create at least 109
full-time (or equivalent) jobs on the property. Buyer will ensure that at least 51% of the jobs created will be
held by low to moderate income individuals. Buyer will provide proof of its good faith efforts to the City on a
timely basis.
http://www.cfwnet.org/council_packet/Reports/mc_print.asp 1/27/2006
Page 2 of 2
Additional conditions of the sale are outlined in the license agreement as follows:
Operation and Use: The Buyer agrees to operate the facility in accordance with the original vision of an
Hispanic-themed marketplace that serves the communtiy. The facility will be operated with retail on the first
floor, office/retail on the second floor and a banquet/meeting room on the third floor.
Community Events: Buyer agrees to hold or sponsor at least four Hispanic-themed events in the Fort
Worth Mercado per year. The Buyer commits to using best efforts to coordinate these events with the Fort
Worth Hispanic Chamber or the Latin Arts Association.
The proceeds from this sale will be deposited into the Section 108 Mercado Project Repayment Account.
This property is located in COUNCIL DISTRICT 2, Mapsco 62L.
FISCAL INFORMATION/CERTIFICATION:
The Finance Director certifies that the Economic and Community Development Department is responsible
for the collection and deposit of funds from this sale.
TO Fund/Account/Centers FROM Fund/Account/Centers
R106 126002 000106002000 $2,500,000.00
Submitted for City Manager's Office Dale Fisseler(6140)
Originating Department Head: Tom Higgins (6192)
Additional Information Contact: Robert Sturns (8634)
http://www.cfwnet.org/council_packet/Reports/mc_print.asp 1/27/2006