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HomeMy WebLinkAboutContract 36633-A1 � a CITY SECRETARY CONTRACT NO.5 -� AMENDMENT NO. 1 TO ECONOMIC DEVELOPMENT PROGRAM AGREEMENT (CITY SECRETARY CONTRACT NO. 36633) This AMENDMENT NO. 1 TO ECONOMIC DEVELOPMENT PROGRAM 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, and CARLYLE/CYPRESS WEST 7"', LP ("Developer"), a Delaware limited partnership. The following introductory provisions are true and correct and for the basis of this Amendment: A. As of February 15, 2008 the City and Developer entered into that certain Economic Development Program Agreement on file in the City Secretary's Office as City Secretary Contract No. 36633 (the "Agreement"). Under the Agreement, Developer agreed, among other things, to construct a mixed-used development (the "Development", as more specifically defined in the Agreement) on certain real property located in the City's cultural district, which has been identified by the Comprehensive Plan as a regional mixed-use growth center where public incentives could effectively be used as a catalyst for beneficial long-term planned development in the City. In return, the City agreed to pay Developer certain Program Grants as authorized by Chapter 380 of the Texas Local Government Code and outlined in the Agreement. B. The Agreement currently prohibits Developer from assigning the Agreement to a non-Affiliate without prior City Council approval. Developer has requested that the Agreement be amended to permit Developer to assign the Agreement as partial security to lenders providing financing toward the Development without prior approval of the City Council. The City is willing to amend the Agreement in order to address Developer's request, as more specifically set forth in this Amendment. NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the City and Developer hereby agree as follows: 1. Section 10 of the Agreement (Assignment and Successors) is hereby amended to add the following sentence immediately after the first sentence of such Section 10: In addition, Developer may assign its rights and obligations under this Agreement to a financial institution or other lender for purposes of granting a security interest in the Development and/or Develo m OFFICIAL RECORD CITY SECRETARY FT.WORTH,TX Property without the approval of the City Council, provided that Developer and the financial institution or other lender first execute a written Consent to Assignment with the City in substantially the same form as that attached hereto as Exhibit I'D", together with such other terms and conditions as may be agreed by the City, Developer, and the financial institution or other lender with respect to such security interest. 2. All terms in this Amendment that are capitalized but not defined shall have the meanings assigned to them in the Agreement. 3. All terms and conditions of the Agreement that are not expressly amended pursuant to this Amendment shall remain in full force and effect. EXECUTED as of the last date indicated below: CITY OF FORT WORTH: APPROVED AS TO FORM AND LEGALTIY: By: By: s lanis Peter Vaky Assistant City Manager Assistant City Attorney Date: S �S I M&C: C-2'f 7 2 2 Attested_by, '°' o0d Marty Hendrix. City Weareukry �'�?'d' 000000 °o°°-` �4a4A�4oap OFFICIAL RECORD CITY SECRETARY Re WORTH,TX Page 2 Amendment No. 1 to CSC No.36633 Economic Development Program Agreement with Carlyle/Cypress West 7`h,LP CARLYLE/CYPRESS WEST 7TH, LP, a Delaware limited partnership: By: Carlyle/Cypress West 7th GP, LLC, a Delaware limited liability company, its General Partner By: Carlyle/Cypress Retail I, L.P., a Delaware limited partnership, its Sole Member By: Cypress Equities, LLC, a Texas limited liability company, its General P ner By. Name: C . Title: ✓V OFFICIAL RECORD CITY SECRETARY FT.WORTH,TX Page 3 Amendment No. t to CSC No.36633 Economic Development Program Agreement with Carlyle/Cypress West 7`h,LP EXHIBIT "D" Form of Consent to Collateral Assignment Amendment No. 1 to CSC No.36633 Economic Development Program Agreement with Carlyle/Cypress West Vh,LP EXHIBIT "D" Form of Consent to Collateral Assignment CONSENT TO ASSIGNMENT FOR SECURITY PURPOSES OF ECONOMIC DEVELOPMENT PROGRAM AGREEMENT BETWEEN CITY OF FORT WORTH AND CARLYLE/CYPRESS WEST 7TH, LP (CITY SECRETARY CONTRACT NO. 36633, AS AMENDED) This CONSENT TO ASSIGNMENT FOR SECURITY PURPOSES OF ECONOMIC DEVELOPMENT PROGRAM AGREEMENT ("Consent") is 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; and CARLYLE/CYPRESS WEST 7TH, LP ("Developer"), a Delaware limited partnership; and « n » RECITALS The City, Developer and Lender hereby agree that the following statements are true and correct and constitute the basis upon which the parties have entered into this Consent: A. The City and Developer previously entered into that certain Economic Development Program Agreement, dated as of February 15, 2008, and Amendment No. 1 thereto, dated as of , 2011 (collectively, the "EDPA") pursuant to which the City agreed to pay Developer certain Program Grants in an amount up to and not to exceed $31,280,000.00 (as more specifically outlined in the EDPA) in return for Developer's construction of a mixed-use development located in cultural district of the City, as more specifically outlined in the EDPA (the "Development"). The EDPA is a public document on file in the City Secretary's Office as City Secretary Contract Nos. 36633 and B. Section 10 of the EDPA allows Developer to assign its rights and obligations under the EDPA to a financial institution or other lender for purposes of granting a security interest in the Development and/or Development Property without the approval of the City Council, provided that Developer and the financial institution or other lender first execute a written agreement with the City governing the rights and obligations of the City, Developer, and the financial institution or other lender with respect to such security interest. Amendment No. I to CSC No.36633 Economic Development Program Agreement with Carlyle/Cypress West 7`h, LP C. Developer wishes to obtain a loan from Lender in order to [state reason for loan] (the "Loan"). As security for the Loan, certain agreements between Developer and Lender governing the Loan and dated , including, but not limited to, that certain Loan Agreement and [list other related documents] (collectively, the "Loan Documents") require that Developer assign, transfer and convey to Lender all of Developer's rights, interest in and to the EDPA until such time as Developer has fully satisfied all duties and obligations set forth in the Loan Documents that are necessary to discharge Lender's security interest in the EDPA (the "Assignment"). D. The City is willing to consent to this Assignment specifically in accordance with the terms and conditions of this Consent. AGREEMENT 1. The City, Developer and Lender hereby agree that the recitals set forth above are true and correct and form the basis upon which the City has entered into this Consent. 2. The City hereby consents to the Assignment at the request of Developer and Lender solely for the purpose of Lender's securing the Loan pursuant to and in accordance with the Loan Documents. Notwithstanding such consent, the City does not adopt, ratify or approve any of the particular provisions of the Loan Documents and, unless and to the extent specifically acknowledged by the City in this Consent, does not grant any right or privilege to Lender or any assignee or successor in interest thereto that is different from or more extensive than any right or privilege granted to Developer under the EDPA. 3. In the event that the City is required by the EDPA to provide any kind of written notice to Developer, including notice of breach or default by Developer, the City shall also provide a copy of such written notice to Lender, addressed to the following, or such other party or address as Lender designates in writing, by certified mail, postage prepaid, or by hand delivery: or such other address(es) as Lender may advise City from time to time. 4. If Developer fails to cure any default under the EDPA, the City agrees that Lender, its agents or designees shall have an additional thirty (30) calendar days or such greater time as may specifically be provided under the EDPA=to perform any of the obligations or requirements of Developer imposed by the EDPA and that the City will accept Lender's performance of the same as if Developer had performed such obligations Exhibit"D" Amendment No. I to CSC No.36633 Economic Development Program Agreement with Carlyle/Cypress West 7'h,LP or requirements; provided, however, that in the event such default cannot be cured within such time, Lender, its agents or designees, shall have such additional time as may be reasonably necessary if within such time period Lender has commenced and is diligently pursuing the remedies to cure such default, including, without limitation, such time as may be required for lender to gain possession of Developer's interest in the Developer property pursuant to the terms of the Loan Documents. 5. If at any time Lender wishes to exercise any foreclosure rights under the Loan Documents, before taking any foreclosure action Lender shall first provide written notice to the City of such intent (a "Notice"). Lender shall copy Developer on the Notice and deliver such Notice to Developer by both first class and certified mail return receipt concurrent with its transmittal of the Notice to the City and represent in the Notice that it has done so. Notwithstanding anything to the contrary herein, unless Lender enters into a written agreement with the City to assume and be bound by all covenants and obligations of Developer under the EDPA, Lender understands and agrees that the City shall not be bound to pay Lender any Program Grants pursuant to the EDPA. In addition, Lender understands and agrees that if Lender wishes to sell all or any portion of the Development Property or improvements thereon to a third party following Lender's exercise of any foreclosure rights under the Loan Documents, the City shall not be bound to pay such third party any Program Grants pursuant to the EDPA unless Lender and such third party comply with the procedure for assignment set forth in Section 10 of the EDPA, including the obligation of such third party to enter into a written agreement with the City to assume and be bound by all covenants and obligations of Developer under the EDPA. In the event that payment of any Program Grants are withheld by the City pursuant to this Section 5, any rights to receipt of those Program Grants are hereby waived, but the number and amount(s) of any scuh Program Grant(s) shall nevertheless be counted for purposes of calculating the Term of the EDPA, as set forth in Section 3 of the EDPA. 6. In the event of any conflict between this Consent and the EDPA or any of the Loan Documents, this Consent shall control. In the event of any conflict between this Consent and any of the Loan Documents, this Consent shall control. In the event of any conflict between the EDPA and any of the Loan Documents, the EDPA shall control. 7. This Consent may not be amended or modified except by a written agreement executed by all of the parties hereto. Notwithstanding anything to the contrary in the Loan Documents, an amendment to any of the Loan Documents shall not constitute an amendment to this Consent or the EDPA. 8. Once Developer has fully satisfied all duties and obligations set forth in the Loan Documents that are necessary to discharge Lender's security interest in the EDPA and such security interest is released, Lender shall provide written notice to the City that Lender has released such security interest, in which case this Consent shall automatically terminate. 9. This Consent shall be construed in accordance with the laws of the State of Texas. Venue for any action arising under the provisions of this Consent shall lie in state courts Exhibit"M Amendment No. 1 to CSC No. 36633 Economic Development Program Agreement with Carlyle/Cypress West 7`h,LP located in Tarrant County, Texas or in the United States District Court for the Northern District of Texas, Fort Worth Division. 10. Capitalized terms used but not specifically defined in this Consent shall have the meanings ascribed to them in the EDPA. 11. This written instrument contains the entire understanding and agreement between the City, Developer and Lender as to the matters contained herein. Any prior or contemporaneous oral or written agreement concerning such matters is hereby declared null and void to the extent in conflict with this Consent. 12. This Consent shall be effective on the later date as of which all parties have executed it. This Consent may be executed in any number of duplicate originals and each duplicate original shall be deemed to be an original. The failure of any party hereto to execute this Consent, or any counterpart hereof, shall not relieve the other signatories from their obligations from their obligations hereunder. EXECUTED as of the last date indicated below: [SIGNATURES IMMEDIATELY FOLLOW ON NEXT PAGE] Exhibit I'D" Amendment No. 1 to CSC No. 36633 Economic Development Program Agreement with Carlyle/Cypress West 7`h,LP CITY OF FORT WORTH: APPROVED AS TO FORM AND LEGALITY: By: By: Name: Name: Assistant City Manager Assistant City Attorney Date: M&C: none required CARLYLE/CYPRESS WEST 7TH, LP, a Delaware limited partnership: By: Carlyle/Cypress West 7"' GP, LLC, a Delaware limited liability company, its General Partner By: Carlyle/Cypress Retail I, L.P., a Delaware limited partnership, its Sole Member By: Cypress Equities, LLC, a Texas limited liability company, its General Partner By: Name: Title: Date: By: Name: Title: Date: Exhibit"D" Amendment No. I to CSC No.36633 Economic Development Program Agreement with Carlyle/Cypress West 71h,LP M&C Review Page 1 of 2 Official site of the City of Fort Worth,Texas CITY COUNCIL AGENDA FoRTWORTH DATE: 2/1/2011 REFERENCE NO.:"C-24722 LOG NAME: 17WEST7THAMEND1 CODE: C TYPE: CONSENT PUBLIC NO HEARING: SUBJECT: Authorize Execution of Amendment No. 1 to City Secretary Contract No. 36633, Economic Development Program Agreement with Carlyle/Cypress West Seventh, LP, for the Mixed- Use Development at West Seventh Street and University Drive to Allow Collateral Assignments(COUNCIL DISTRICT 9) RECOMMENDATION: It is recommended that the City Council authorize the City Manager to execute Amendment No. 1 to City Secretary Contract No. 36633, an Economic Development Program Agreement with Carlyle/Cypress West Seventh, LP, for the mixed-use development at West Seventh Street and University Drive to allow collateral assignments of the Agreement. DISCUSSION: The City and Carlyle/Cypress West 7th, LP (Developer) entered into an Economic Development Program Agreement (City Secretary Contract No. 36633) (the Agreement) under which the City agreed to pay Developer certain economic development program grants in return for Developer's construction of the mixed-used development at West 7th Street and University Drive. The Agreement prohibits Developer from assigning its rights and obligations under the Agreement to another party. Developer has now requested that the City amend the Agreement to permit the Developer to make assignments as security to lenders providing financing toward the development without prior approval of the City Council. Developer would have to provide the City with copies of all loan agreements, deeds of trust, and other documents between the Developer and the financial institution. Frequently as security for the loan, certain agreements between the Developer and the lender governing the loan require the Developer to assign to the lender all the Developer's rights, interest in and to the Agreement until such time as the Developer has fully satisfied all duties and obligations under the loan documents. Therefore, a Consent to Assignment would also be executed by the City, Developer and the lender to outline the transfer of specific rights and interest and to provide that if the lender foreclosed on its interest under the Agreement, the lender would be bound by the duties and obligations of Developer under that Agreement. The project affected by this amendment is located in COUNCIL DISTRICT 9. FISCAL INFORMATION/CERTIFICATION: The Financial Management Services Director certifies that this action will have no material effect on City funds. TO Fund/Account/Centers FROM Fund/Account/Centers Submitted for City Manager's Office by: Susan Alanis (8180) Originating Department Head: Jay Chapa (5804) Additional Information Contact: Robert Sturns (8003) http://apps.cfwnet.org/council_packet/mc_review.asp?ID=14736&councildate=2/i/20l 1 2/11/2011 M&C Review Page 2 of 2 ATTACHMENTS Amendment No._1 to Contract 36633 W 7th 380.doc http://apps.cfwnet.org/council_packet/mc_review.asp?ID=l4736&councildate=2/l/201 1 2/11/2011