HomeMy WebLinkAboutContract 37032C6TY SECRETARY
CONTRACT NO.
AMENDMENT NO. 1 TO CITY SECRETARY CONTRACT 1N0.36458
TAX ABATEMENT AGREEMENT BETWEEN
CITY OF FORT WORTH AND CINRAM WIRELESS, LLC
This AMENDMENT NO. 1 TO TAX ABATEMENT AGREEMENT
("Amendment") is made and entered into by and between the CITY OF FORT
WORTH ("City"), a home rule municipal corporation organized under the laws of the
State of Texas; ALLIANCE GATEWAY NO. 11, LTD. ("Alliance"), a Texas limited
partnership; and CINRAM WIRELESS, LLC ("Cinram"), a Delaware limited liability
company.
The following introductory provisions are true and correct and for the basis of this
Amendment:
A. As of December 28, 2007 the City, Alliance, and Cinram entered into that certain
Tax Abatement Agreement on file in the City Secretary's Office as City Secretary
Contract No. 36458 (the "Agreement"). Under the Agreement, Alliance agreed, among
other things, to cause construction of a wireless telephone manufacturing facility on Land
in the City owned by Alliance Gateway No. 11, Ltd. (the "Land"), and Cinram agreed to
place certain taxable tangible personal property on the Land and to fill a certain
percentage of Full-time Jobs on the Land with individuals residing in the Central City, all
as more specifically set forth in the Agreement. In return, the City agreed to abate, for a
period of ten (10) years, up to seventy-five percent (75%) of the real property taxes on
the Land and the improvements thereon and up to seventy-five percent (75%) of the
personal property taxes on Cinram's taxable tangible personal property located on the
.and,
B. The City, Alliance, and Cinram now wish to amend the Agreement in order to
revise Cinram's obligation with respect to the installation of taxable tangible personal
property on the Land and Cinram's commitment to provide certain Full-time Jobs on the
.and.
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the City, Alliance, and Cinram hereby
agree as follows:
1. The first sentence of Section 1.1 of the Agreement (Real Property Improvements)
is hereby deleted in its entirety and replaced with the following sentence:
In accordance with the Lease, Alliance shall construct or cause to be
,` i 5"v constructed by the Completion Deadline certain improvements on the
; , o Land consisting of, at a minimum, a wireless telephone manufacturing
Lip of approximately 788,160 square feet in size and having a
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Amendment No. 1 to CSC No. 36458
Tax Abatement Agreement with Alliance No. 11, Ltd. and Cinram Wireless, LLC
minimum aggregate Construction Cost upon completion of
$15,500,000.00 (collectively, the "Required Improvements").
2. The third sentence of Section 1.2 of the Agreement (Completion Date of Required
Improvements and Installation of Tangible Personal Property) is hereby deleted in its
entirety and replaced with the following sentence:
Cinram further covenants and agrees that at least $10,500,000 worth of
taxable new tangible personal property owned by Cinram or leased by and
taxable to Cinram will be placed on the Land by the Completion Deadline,
unless delayed because of Force Majeure, in which case this deadline shall
be extended by the number of days comprising the specific Force Majeure.
3. Section 2.1.1 of the Agreement (Abatement Based on Construction and Personal
Property Expenditures (10%)) is hereby deleted in its entirety and replaced with the
following:
Alliance shall receive a ten percent (10%) Abatement in each year
of the Abatement Term, as defined in Section 2.5, if by the Completion
Deadline (i) at least $15,500,000.00 in Construction Costs were expended
on the Required Improvements and (ii) at least $10,500,000.00 in taxable
tangible personal property owned by Cinram or leased by and taxable to
Cinram is located on the Land. If by the Completion Deadline less than
$15,500,000.00 in Construction Costs have been expended on the
Required Improvements or less than $10,500,000.00 in taxable tangible
personal property owned by Cinram or leased by and taxable to Cinram is
located on the Land, not only will Alliance be ineligible to receive the ten
percent (10%) Abatement under this Section 2.1.1, but an Event of
Default, as defined and addressed in Section 4, shall also occur.
4. The first sentence of Section 2.1.6 of the Agreement (Abatement Based on
Number of Full-time Jobs with Central City Residents (Up to 5%)) is hereby deleted in
its entirety and replaced with the following sentence:
Subject to Section 2.1.4 of this Agreement, Alliance shall receive a
five percent (5%) Abatement in any given year of the Abatement Term, as
defined in Section 2.5, if on the Compliance Date in the previous calendar
year at least ten percent (10%o) of all Full-time Jobs provided and filled on
---the Larid by Cinram, regardless of the number of such Full-time Jobs,
t were held by individuals residing in the Central City (the "Central City
Employment Commitment").
,f
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Amendment No. Ito CSC No. 36458
Tax Abatement Agreement with Alliance No. 11, Ltd. and Cinram Wireless, LLC
5. The last sentence of Section 2.1.6 of the Agreement (Abatement Based on
Number of Full-time Jobs with Central City Residents (Up to 5%)) is hereby deleted in
its entirety and replaced with the following sentence:
For example, if Cinram provided and filled 1,300 Full-time Jobs on the
Land in a given year of the Compliance Auditing Term (meaning that the
Central City Employment Commitment would be 130 Full-time Jobs), and
only 78 Full-time Jobs provided and filled on the Land by Cinram were
held by individuals residing within the Central City, the percentage of
Abatement granted in the following year of the Abatement Term pursuant
to this Section 2.1.6 would be reduced from 5% to 3% (or .05 x 78/130, or
05 x .60, or 0.03).
6. The first three sentences of Section 4.2 (Notice to Cure) is hereby deleted in its
entirety and replaced with the following:
Subject to Section 2.1.9 and Section 5 of this Agreement, if the City
determines that an Event of Default has occurred, the City shall provide a
written notice to Cinram and Alliance that describes the nature of the
Event of Default. If the Event of Default is due to a breach under sections
1.1 or 1.2 of this Agreement, or on account of the expiration or
termination of the Lease, the City will have the right, as its sole and
exclusive remedy in addition to any other rights the City may have under
Section 4.3 hereof, to terminate this Agreement immediately. For any
other Event of Default, including without limitation an Event of Default
due to a breach under Section 1.3 of this Agreement, Cinram and Alliance
shall have sixty (60) calendar days from the date of receipt of this written
notice to fully cure or have cured the Event of Default.
7. This Amendment shall take effect as of the date both parties have executed this
Amendment.
8. The first parenthetical of Section 4.3 of the Agreement is hereby deleted in its
entirety and is replaced with the following parenthetical: "(and which Event of
Default is uncured)".
8. All terms in this Amendment that are capitalized but not defined shall have the
meanings assigned to them in the Agreement.
- 9. All terms and conditions of the Agreement that are
�; 22 ''•_ ursuant to this Amendment shall remain in full force and effect.
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Amendment No. 1 to CSC No. 36458
Tax Abatement Agreement with Alliance No. 11, Ltd. and Cinram Wireless, LLC
not expressly amended
IN WITNESS WHEREOF, the undersigned have caused this Amendment to be
executed as of the later date below:
[SIGNATURES FOLLOW IMMEDIATELY ON NEXT THREE (3) PAGES]
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Amendment No. 1 to CSC No. 36458
Tax Abatement Agreement with Alliance No. 11, Ltd. and Cinram Wireless, LLC
CITY OF FORT WORTH:
By:
Tom Higgins
" Assistant City Manager
Date:
ATTEST:
By: ,
City Secretary
STATE OF TEXAS §
COUNTY OF TARRANT §
APPROVED AS TO FORM AND
LEGALITY:
2
Peter Vaky
Assistant City Attorney
M&C:
BEFORE ME, the undersigned authority, on this day personally appeared Tom
Higgins, PTMftg Assistant City Manager of the CITY OF FORT WORTH, a municipal
corporation organized under the laws of the State of Texas, known to me to be the person
and officer whose name is subscribed to the foregoing instrument, and acknowledged to me
that the same was the act of the CITY OF FORT WORTH, that he was duly authorized to
perform the same by appropriate resolution of the City Council of the City of Fort Worth
and that he executed the same as the act of the CITY OF FORT WORTH for the
purposes and consideration therein expressed and in the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this day of
2008.
Nofary Public in and
the State of Texas
Notary's Printed Name
Cs�y STATE OF TEXAS
OF iT M; Comm. Exp.12-14-2009
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Amendment No. 1 to CSC No. 36458
Tax Abatement Agreement with Alliance No. 11, Ltd. and Cinram Wireless, LLC
ALLIANCE GATEWAY NO. 11,
a Texas limited partnership:
By: Hl11WOOd Alliance Management, L.P.,
a Texas limited partnership,
its general partner:
By: Hillwood Alliance GP, LLC,
a Texas limited liability company,
its general artner:
By: /46141/�4
ichael K. Berry
Executive Vice Pre/dent
STATE OF TEXAS §
BEFORE ME, the undersigned authority, on this day personally appeared Michael
C Berry, Executive Vice President of Hillwood Alliance GP, LLC, general partner of
Hillwood Alliance Management, L.P., general partner of ALLIANCE GATEWAY NO.
11, LTD., known to me to be the person whose name is subscribed to the foregoing
instrument, and acknowledged to me that he executed the same for the purposes and
consideration therein expressed, in the capacity therein stated and as the act and deed of
ALLIANCE GATEWAY NO.11, LTD..
�NEN UNDER MY HAND AND SEAL OF OFFICE this
day of ( I
Notary Public in and for
the State of Texas
"a�►�'o,, SONDIE M. STOGSDILL
\ :'.•,' �`�=- Notary Public, State of Texas
C l - ' My Commission Expires
Notary's Printed Name '~�';EaF��:�'` February 22, 201 t
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Amendment No. 1 to CSC No. 36458
Tax Abatement Agreement with Alliance No. 1 1, Ltd. and Cinram Wireless, LLC
CINRAM WIRELESS, LLC:
By:
Name:
Title:
Date:
ATTEST:
STATE O N
COUNTY O §
B FORE ME the undersi ned authorit , } on this day personally appeared
y, of CINRAM WIRELESS, LLC,
known to me to'be the person whose name is subscribed to the foregoing instrument, and
acknowledged to me that s/he executed the same for the purposes and consideration therein
expressed, in the capacity therein stated and as the act and deed of CINRAM WIRELESS,
LLC.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this
day of
Notary Public in and for
the State of
Notary's Printed Name
DEBBIE S. FISHER i
Notary Public, State of Texas
My Commission Expires
July 31, 2008
v�T Y '2 .2 ". ° if
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Amendment No. 1 to CSC No. 36458
Tax Abatement Agreement with Alliance No. 11, Ltd. and Cinram Wireless, LLC
Page 1 of 2
City of Fort Worth, Texas
Mayor and Council Communication
COUNCIL ACTION: Approved on 4/29/2008
DATE: Tuesday, April 29, 2008
LOG NAME: 17CRAMAMEND
REFERENCE NO.: �*C-22783
SUBJECT:
Authorize Execution of Amendments to City Secretary Contract Nos. 36456 and 36458, Tax
Abatement Agreements with Cinram Wireless, LLC, and Alliance Gateway No. 11, Ltd., Revising
Commitments for Employment and the installation of New Business Personal Property
RECOMMENDATION:
It is recommended that the City Council authorize the City Manager to execute the attached amendments to
the Tax Abatement Agreements with Cinram Wireless, LLC, and Alliance Gateway No. 11, Ltd., (City
Secretary Contract Nos. 36456 and 36458).
DISCUSSION:
On September 18, 2007, the City Council authorized execution of ten-year Tax Abatement Agreements with
Cinram Wireless, LLC, (Cinram) and Alliance Gateway No. 11, Ltd., (Alliance), for the construction of a
wireless telephone facility in the Alliance Corridor in north Fort Worth (M&C C-22398).
The proposed amendments provide that 10 percent (rather than 15 percent) of all full-time jobs at the facility
be held by Central City residents. The 10 percent figure is consistent with what was presented to City
Council, but M&C C-22398 erroneously set the commitment at 15 percent.
During negotiations it was understood that all of Cinram's investment in business personal property would
be new. Cinram has now notified the City that a portion of their business personal property will be
purchased from another Fort Worth company. The property is existing on the tax rolls and not subject to
abatement and cannot be counted towards Cinram's investment. Therefore, the proposed amendment
reduces the commitment for the business personal property investment from $15 million to $10.5 million.
Cinram also requested a language revision to more accurately capture the intent of the parties regarding
the levying of liquidated damages in the event of default.
Otherwise, the structure and terms of the Agreement will remain the same.
This project is in COUNCIL DISTRICT 2.
http://apps.cfwnet.org/council�acket/Reports/mc�rint.asp 5/1/2008
Page 2 of 2
FISCAL INFORMATION/CERTIFICATION:
The Finance Director certifies that this action will have no material impact on City funds.
TO Fund/AccountlCenters
FROM Fund/Account/Centers
Submitted for City Manager's Office b� Tom Higgins (6140)
Originating Department Head: Jay Chapa (6192)
Additional Information Contact: Mark Folden (8634)
http://apps.cfwnet.org/council�acket/Reports/mc�rint.asp 5/1 /2008