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HomeMy WebLinkAboutRes 18-06 Authorizing the Mayor to Enter into a reimbursement agreement for Solana PID Assessment Part B TOWN OF WESTLAKE RESOLUTION NO. 18-06 A RESOLUTION AUTHORIZING THE TOWN MAYOR TO ENTER INTO THE SOLANA PUBLIC IMPROVEMENT DISTRICT ASSESSMENT PART B REIMBURSEMENT AGREEMENT WITH THE TOWN OF WESTLAKE, TEXAS (THE "TOWN") AND MRW INVESTORS, LLC, A TEXAS LIMITED LIABILITY COMPANY ("THE DEVELOPER") TO BE EFFECTIVE JANUARY 29, 2018 FOR $2,425,000 FOR IMPROVEMENT PROJECT B, WHICH INCLUDES A PARKING GARAGE. WHEREAS, the Public Improvement District Assessment Act, Texas Local Government Code, Chapter 372, as amended (the "Act"), authorizes the Town Council (the "Council") of the Town of Westlake, Texas (the "Town"), to create a public improvement district within the Town; and WHEREAS, on February 24, 2014, the Council conducted a public hearing to consider a petition received by the Town on October 18, 2013 titled "Petition for the Creation of a Public Improvement District Within the Town of Westlake, Texas, for the Solana Public Improvement District" requesting the creation of a public improvement district; and WHEREAS, on February 24, 2014, the Council approved Resolution No. 14-07 (the "Authorization Resolution"), authorizing, establishing and creating the Solana Public Improvement District (the "District"); and WHEREAS, on January 15, 2015, the Council adopted Ordinance No. 741 which, among other matters, approved and accepted the Solana Public Improvement District Service and Assessment Plan (the "SAP")and levied assessments on certain assessable property in the District; and WHEREAS, on January 29, 2017, the Council passed and approved Ordinance No. 843 (the "Part B Assessment Ordinance"),which Part B Assessment Ordinance (i)approved an update to the SAP entitled Solana Public Improvement District Annual Service Plan Update-Assessment Part B(the "SAP Update") and (ii) levied the Assessment Part B against all assessable property in the District (the "Part B Assessed Property") benefitting from Improvement Project B improvements (the "Improvement Project B Improvements") in the amount noted on the Assessment Roll for Assessment Part B attached as an Appendix to the SAP Update; and WHEREAS, capitalized terms used in this Agreement and not otherwise defined shall have the meanings given to them in the SAP and the SAP Update; and WHEREAS, all Assessment Part B revenues (the "Assessment Part B Revenues")shall be deposited into an Assessment Part B project fund segregated from all other funds of the Town(the "Project Fund") as further described herein; and WHEREAS, the Project Fund shall be used to reimburse the Developer as set forth in this Agreement and subject to the provisions of any trust indenture (each a "Bond Indenture") relating Resolution 15-06 Page I of 2 to any bonds issued for Improvement Project B (the "Improvement Project B Bonds"), if any are issued, to pay the Reimbursement Amount (hereinafter defined); NOW, THEREFORE, BE IT RESOLVED BY THE TOWN COUNCIL OF THE TOWN OF WESTLAKE, TEXAS: SECTION 1: That, all matters stated in the Recitals hereinabove are found to be true and correct and are incorporated herein by reference as if copied in their entirety. SECTION 2: That The Town of Westlake Town Council hereby authorizes the Mayor to enter into the Solana Public Improvement District Assessment Part B Reimbursement Agreement with the Town of Westlake,Texas(the"town")and MRW Investors,LLC,a Texas limited liability company ("the developer") to be effective January 29, 2018 for $2,425,000 for Improvement Project B, which includes a parking garage. SECTION 3: If any portion of this Resolution shall, for any reason, be declared invalid by any court of competent jurisdiction, such invalidity shall not affect the remaining provisions hereof and the Council hereby determines that it would have adopted this Resolution without the invalid provision. SECTION 4: That this resolution shall become effective from and after its date of passage. PASSED AND APPROVED ON THIS 29TH DAY OF JANUARY 2018. 'A ST< ATTEST: Laura L. Wheat, Mayor Kelly Edward , Town Secretary Thomas E. Br y r, T n Manager APPROVE AS TO Ff�• L. anton fownAttorney Resolution 18-06 Page 2 of 2 SOLANA PUBLIC IMPROVEMENT DISTRICT ASSESSMENT PART B REIMBURSEMENT AGREEMENT This Solana Public Improvement District Assessment Part B Reimbursement Agreement (this "Agreement") is executed between the Town of Westlake, Texas (the "Town") and MRW Investors, LLC, a Texas limited liability company (the "Developer") (individually referred to as a "Party" and collectively as the "Parties")to be effective January 29, 2018 (the "Effective Date"). RECITALS WHEREAS, the Public Improvement District Assessment Act, Texas Local Government Code, Chapter 372, as amended (the "Act"), authorizes the Town Council (the "Council") of the Town of Westlake, Texas (the "Town"), to create a public improvement district within the Town; and WHEREAS, on February 24, 2014, the Council conducted a public hearing to consider a petition received by the Town on October 18, 2013 titled "Petition for the Creation of a Public Improvement District Within the Town of Westlake, Texas, for the Solana Public Improvement District" requesting the creation of a public improvement district; and WHEREAS, on February 24, 2014, the Council approved Resolution No. 14-07 (the "Authorization Resolution"), authorizing, establishing and creating the Solana Public Improvement District(the "District"); and WHEREAS, on January 15, 2015,the Council adopted Ordinance No. 741 which, among other matters, approved and accepted the Solana Public Improvement District Service and Assessment Plan (the "SAP")and levied assessments on certain assessable property in the District; and WHEREAS, on January 29, 2018, the Council passed and approved Ordinance No. (the "Part B Assessment Ordinance"), which Part B Assessment Ordinance (i) approved an update to the SAP entitled Solana Public Improvement District Annual Service Plan Update - Assessment Part B(the "SAP Update")and(ii)levied the Assessment Part B against all assessable property in the District(the "Part B Assessed Property") benefitting from Improvement Project B improvements (the "Improvement Project B Improvements") in the amount noted on the Assessment Roll for Assessment Part B attached as an Appendix to the SAP Update; and WHEREAS, capitalized terms used in this Agreement and not otherwise defined shall have the meanings given to them in the SAP and the SAP Update; and WHEREAS, all Assessment Part B revenues (the "Assessment Part B Revenues") shall be deposited into an Assessment Part B project fund segregated from all other funds of the Town(the "Project Fund") as further described herein; and WHEREAS,the Project Fund shall be used to reimburse the Developer as set forth in this Agreement and subject to the provisions of any trust indenture (a 'Bond Indenture") relating to any bonds issued for Improvement Project B Improvements(the "Improvement Project B Bonds"), if any are issued, to pay the Reimbursement Amount(hereinafter defined). NOW THEREFORE, FOR VALUABLE CONSIDERATION THE RECEIPT AND ADEQUACY OF WHICH ARE ACKNOWLEDGED, THE PARTIES AGREE AS FOLLOWS: 1. The recitals in the "WHEREAS" clauses of this Agreement are true and correct, create obligations of the Parties, and are incorporated as part of this Agreement for all purposes. 2. The Town shall cause to be deposited into the Project Fund, unless Improvement Project B Bonds are issued, all Assessment Part B Revenues collected (excluding Delinquent Collection Costs and annual Administrative Expenses). If Improvement Project B Bonds are issued, then Assessment Part B Revenues shall be deposited into the funds and accounts set forth in, and pursuant to, a Bond Indenture. The Project Fund shall only be used as provided in this Agreement and for no other purposes. Strictly subject to the terms, conditions and requirements and solely from the revenues herein provided, and subject to the Developer making the initial deposit required by Section 3 below, the Town agrees to pay to the Developer, and the Developer shall be entitled to receive from the Town, until September 1, 2048 (the "Maturity Date") Two MILLION FOUR HUNDRED TWENTY-FIVE THOUSAND DOLLARS ($2,425,000.00), or so much thereof as from time to time remains outstanding (such outstanding amount, from time to time, is referred to as the "Reimbursement Amount"), for the cost of the Improvement Project B Improvements, solely from the net proceeds of one or more series of Improvement Project B Bonds issued by the Town to pay the Reimbursement Amount (the 'Bond Proceeds") and from the Project Fund as provided in Section 5 below. The costs of the Improvement Project B Improvements are authorized by the Act and approved by the Council and represent the total cost to be assessed against the Part B Assessed Property for the Improvement Project B Improvements, which are eligible public improvement projects that are being undertaken and financed by the PID for the special benefit of the Part B Assessed Property and that upon completion will be dedicated in fee and accepted by the Town. The Reimbursement Amount shall bear simple interest per annum at the rate of(i) 6.43%from the Effective Date through January 28, 2023 and (ii) 5.855% from January 29, 2023 through the Maturity Date. If any portion of the Reimbursement Amount remains unpaid after the Town has elected to sell Improvement Project B Bonds,the interest rate paid to the Developer for such unpaid Reimbursement Amount shall continue to be the rate set forth in the immediately preceding sentence. The interest rates have been approved by the Council and are authorized by the Act. 3. On or before February 15, 2018, the Developer shall make an initial deposit of $2,425,000(the "Developer Initial Deposit")into an escrow account held by a trustee bank selected by the Town. The costs of the Improvement Project B Improvements shall be paid first from Developer Initial Deposit held in the escrow account. 4. The Reimbursement Amount, plus interest, which interest shall begin to accrue on the date Improvement Project B Improvements are accepted by the Town, as described above (collectively, the "Unpaid Balance"), are payable to the Developer under this Agreement and are secured by and payable solely from (i) Bond Proceeds and (ii) the Project Fund, if Improvement Project B Bonds are not issued. No other Town funds, revenue,taxes, income or property shall be used even if the Unpaid Balance is not paid in full at or before the Maturity Date. If, notwithstanding its collection efforts, the Town fails to receive all or any part of the Assessment 2 Part B Revenues and, as a result, is unable to make payments from the Project Fund, such failure and inability shall not constitute a Failure or Default by the Town under this Agreement. This Agreement and/or any Improvement Project B Bonds shall not and shall never give rise to or create: a. a charge against the general credit or taxing powers of the Town or any other taxing unit; or b. a debt or other obligation of the Town payable from any source of revenue, taxes, income or properties of the Town other than from Bond Proceeds and the Project Fund; or C. any obligation of the Town to issue Improvement Project B Bonds or other obligations; or d. any obligation of the Town to pay any amount due or to become due under this Agreement other than from Bond Proceeds and the Project Fund and any other funds established under a Bond Indenture. 5. If Improvement Project B Bonds are issued,the Bond Proceeds shall be used to pay the Unpaid Balance. Until Improvement Project B Bonds are issued, the balance in the Project Fund shall be paid to the Developer beginning the first March 31St, June 30th, September 30th or December 31St to occur after the earlier of the date that (i) the Town issues Improvement Project B Bonds, if any, or (ii) the Town issues a certificate of occupancy for the Improvement Project B Improvements (the "Reimbursement Date"), and continuing each month thereafter until the earlier of the Maturity Date or the date the Unpaid Balance is paid in full, at which time this Agreement shall terminate. Notwithstanding the foregoing, the Town's payment obligations under this Agreement shall be subject to the following conditions: (i) either (1) if the Developer is the payee under this Agreement,the Developer must be current on all taxes,fees and obligations to the Town, or (2) if any Transferee (defined below) is the payee under this Agreement, the Transferee must be current on all taxes, fees and obligations to the Town and the Developer must be current on all taxes, fees and obligations to the Town relating to Improvement Project B, (ii) the Developer and/or any Transferee is not in default under this Agreement and (iii) the Developer shall have made the Developer Initial Deposit. 6. If on the Maturity Date, after application of the Bond Proceeds and the balance in the Project Fund, any portion of the Unpaid Balance remains unpaid, such Unpaid Balance shall be canceled and for all purposes this Agreement shall be deemed to have been conclusively and irrevocably PAID IN FULL, and such Unpaid Balance shall no longer be deemed to be payable; provided, however, that if any Assessment Part B Revenues remain due and payable and are uncollected on the Maturity Date, such Assessment Part B Revenues, when, as and if collected after the Maturity Date, shall first be applied to any amounts due in connection with outstanding Improvement Project B Bonds and then paid to the Developer and applied to the Unpaid Balance. 7. The Developer has the right to convey, transfer, assign, mortgage, pledge or otherwise encumber, in whole or in part without the consent of(but with written notice to) the Town, the Developer's right, title or interest under this Agreement including, but not limited to, 3 any right,title or interest of the Developer in and to payment of the Unpaid Balance, whether such payment is from Bond Proceeds or the Project Fund (any of the foregoing, a "Transfer," and the person or entity to whom the transfer is made, a "Transferee"). A Transfer by the Developer pursuant to this Section shall be effective upon delivery to the Town of a copy of the fully executed Transfer or assignment agreement,which shall include the information required by Section 15 and unambiguous provisions regarding any apportionment between the Developer and the Transferee of the right to receive any payments under this Agreement, and from and after the effective date of any Transfer, the Developer shall be released from performing or benefiting from the duties, obligations and rights assigned. Notwithstanding the foregoing, no Transfer shall increase the liability of, or impose additional liabilities upon,the City beyond what is specifically provided for herein or increase the duties or expenses of, or impose additional duties or expenses upon,the City beyond what is specifically provided for herein. 8. The Town may rely on any notice of a Transfer received from the Developer without obligation to investigate or confirm the validity or occurrence of such Transfer. The Developer waives all rights or claims against the Town for any such funds provided to a third party as a result of a Transfer for which the Town has received notice, and the Developer's sole remedy shall be to seek the funds directly from the third party. 9. The inability or failure of the Town to issue Improvement Project B Bonds shall not constitute a Failure or Default under this Agreement. 10. The obligations of the Town under this Agreement are non-recourse and payable only from Bond Proceeds and the Project Fund and do not create a debt or other obligation payable from any other Town revenues, taxes, income or property. None of the Town or any of its elected or appointed officials or any of its officers or employees shall incur any liability hereunder to the Developer or any other party in their individual capacities by reason of this Agreement or their acts or omissions under this Agreement. 11. From and after the Reimbursement Date,following the Town's inspection,approval and acceptance of the Improvement Project B Improvements, and until Improvement Project B Bonds are issued by the Town, if ever,there will be no conditions or defenses to the obligation of the Town to use Bond Proceeds and the Project Fund to pay the Unpaid Balance, except as provided in Section 5 hereof. Except for the conditions contained in this Agreement, if Improvement Project B Bonds are issued by the Town, there will be no conditions or defenses to (i) the pledge of the Project Fund to secure payment of the Improvement Project B Bonds in accordance with the applicable Bond Indenture, (ii)the use of the Bond Proceeds to pay the Unpaid Balance or(iii)the use of any excess funds in the Project Fund to pay the remainder of the Unpaid Balance, if any. 12. Nothing in this Agreement is intended to constitute a waiver by the Town of any remedy the Town may otherwise have outside this Agreement against any person or entity involved in the design, construction or installation of the Improvement Project B Improvements. 13. The Town will consider issuing one or more series of Improvement Project B Bonds when requested by the Developer to pay the Unpaid Balance; however, the Parties covenant and acknowledge that approval of the issuance of Improvement Project B Bonds by the Council is a 4 governmental function within the Town's sole discretion. If the balance in the Project Fund exceeds the amount necessary to pay debt service on the Improvement Project B Bonds in accordance with the applicable Bond Indenture, the excess shall continue to be paid to the Developer and applied against the Unpaid Balance, if any. 14. This Agreement is being executed and delivered, and is intended to be performed in the State of Texas. Except to the extent that the laws of the United States may apply to the terms hereof, the substantive laws of the State of Texas shall govern the validity, construction, enforcement and interpretation of this Agreement. In the event of a dispute involving this Agreement, venue for such dispute shall lie in any court of competent jurisdiction in Tarrant County, Texas. 15. Any notice required or contemplated by this Agreement shall be deemed given at the addresses shown below: (i)when delivered by a national company such as FedEx or UPS with evidence of delivery signed by any person at the delivery address regardless of whether such person was the named addressee or (ii) 72 hours after the notice was deposited with the United States Postal Service,Certified Mail,Return Receipt Requested. Any Party may change its address by delivering written notice of such change in accordance with this Section. Town: Town of Westlake, Texas Attn: Town Manager Westlake Town Hall 1500 Solana Boulevard, Building 7, Suite#7200 Westlake, Texas 76262 With a copy to: Chris Settle McCall, Parkhurst&Horton, L.L.P. 717 North Harwood, 91h Floor Dallas, Texas 75201 With a copy to: Stan Lowry Boyle &Lowry, L.L.P. 4201 Wingren, Suite 108 Irving, Texas 75062 Developer: MRW Investors, LLC, Attn: Mehrdad Moayedi 1800 Valley View Lane, Suite 300 Farmers Branch, Texas 75234 With a copy to: Miklos Law, PLLC Attn: Robert Miklos 1800 Valley View Lane, Suite 360 Farmers Branch, Texas 75234 5 16. If any provision of this Agreement is held invalid by any court, such holding shall not affect the validity of the remaining provisions, and the remainder of this Agreement shall remain in full force and effect. 17. Failure; Default; Remedies. a. If either Party fails to perform an obligation imposed on such Party by this Agreement(a"Failure")and such Failure is not cured after written notice and the expiration of the cure periods provided in this Section, then such Failure shall constitute a "Default." Upon the occurrence of a Failure by a non-performing Party, the other Party shall notify the non-performing Parry and all Transferees of the non-performing Party in writing specifying in reasonable detail the nature of the Failure. The non-performing Party to whom notice of a Failure is given shall have at least 30 days from receipt of the notice within which to cure the Failure;however, if the Failure cannot reasonably be cured within 30 days and the non-performing Party has diligently pursued a cure within such 30-day period and has provided written notice to the other Party that additional time is needed, then the cure period shall be extended for an additional 30-day period so long as the non- performing Party is diligently pursuing a cure. Any Transferee shall have the right,but not the obligation, to cure any alleged Failure by the Developer within the same time periods that are provided to the Developer. The election by a Transferee to cure a Failure by the Developer shall constitute a cure by the Developer but shall not obligate the Transferee to be bound by this Agreement unless the Transferee agrees to be bound. b. If the Developer is in Default,the Town's sole and exclusive remedies shall be to: (1)seek injunctive relief to compel performance by the Developer or(2)seek specific enforcement of this Agreement. Subject to the limitations set forth in Section 5 of this Agreement,no default by the Developer shall affect the obligations of the Town to use the amounts in the Project Fund or Bond Proceeds,if Improvement Project B Bonds are issued, as provided in Sections 10 and 11 of this Agreement. C. If the Town is in Default,the Developer's sole and exclusive remedies shall be to: (1) seek a writ of mandamus to compel performance by the Town or(2)seek specific enforcement of this Agreement. 18. In the event of any conflict between this Agreement and any other agreement between the Town and the Developer directly or indirectly related to the Bond Proceeds or the Project Fund, the Parties intend that the provisions and intent of this Agreement shall control. 19. The failure by a Party to insist upon the strict performance of any provision of this Agreement by the other Party, or the failure by a Party to exercise its rights upon a Default by the other Party shall not constitute a waiver of such Party's right to insist and demand strict compliance by such other Party with the provisions of this Agreement. 20. The Town does not waive or surrender any of its governmental powers, immunities or rights except to the extent permitted by law and necessary to allow the Developer to enforce its remedies under this Agreement. 6 21. Nothing in this Agreement, expressed or implied, is intended to or shall be construed to confer upon or to give to any person or entity other than the Town and the Developer any rights,remedies or claims under or by reason of this Agreement, and all covenants,conditions, promises and agreements in this Agreement shall be for the sole and exclusive benefit of the Town and the Developer. 22. All Parties to this Agreement, including any Transferees, understand that the interest paid by the Town pursuant to this Agreement is not exempt from federal income taxes. 23. THE DEVELOPER AGREES TO INDEMNIFY, DEFEND AND HOLD HARMLESS THE TOWN AND ITS OFFICERS, OFFICIALS, EMPLOYEES AND REPRESENTATIVES FROM AND AGAINST ANY AND ALL CLAIMS, LIENS, SUITS, DEMANDS AND ACTIONS FOR ANY AND ALL DAMAGES AND EXPENSES (INCLUDING COURT COSTS, ATTORNEYS' FEES AND OTHER REASONABLE COSTS OF LITIGATION) ARISING OUT OF OR RESULTING FROM THE DEVELOPER'S OR ANY TRANSFEREE'S USE OF THIS AGREEMENT AS SECURITY FOR THE ISSUANCE OF BONDS OR OTHER OBLIGATIONS. TO THE EXTENT THE DEVELOPER DOES NOT REIMBURSE THE TOWN FOR ANY EXPENSES THE TOWN INCURS UNDER THIS SECTION, THE TOWN SHALL HAVE THE RIGHT TO REIMBURSE ITSELF FROM ASSESSMENT PART B REVENUES PRIOR TO MAKING ANY PAYMENTS TO THE DEVELOPER UNDER THIS AGREEMENT. 24. This Agreement may be amended only by written agreement of the Parties. 25. This Agreement may be executed in counterparts, each of which shall be deemed an original. 26. The Town represents and warrants that this Agreement has been approved by official action by the Council in accordance with all applicable public notice requirements (including, but not limited to, notices required by the Texas Open Meetings Act) and that the individual executing this Agreement on behalf of the Town has been duly authorized to do so. The Developer represents and warrants that this Agreement has been approved by appropriate action of the Developer, and that the individual executing this Agreement on behalf of the Developer has been duly authorized to do so. Each Party respectively acknowledges and agrees that this Agreement is binding upon such Party and is enforceable against such Party, in accordance with its terms and conditions and to the extent provided by law. 27. The Parties agree that at any time after execution of this Agreement,they will,upon request of another Party, execute and deliver such further documents and do such further acts and things as the other Party may reasonably request in order to effectuate the terms of this Agreement. This provision shall not be construed as limiting or otherwise hindering the legislative discretion of the Council seated at the time that this Agreement is executed or any future Council. 28. Each Party shall use good faith, due diligence and reasonable care in the performance of its respective obligations under this Agreement, and time shall be of the essence 7 in such performance; however, in the event a Party is unable, due to force majeure, to perform its obligations under this Agreement, then the obligations affected by the force majeure shall be temporarily suspended. Within three(3)business days after the occurrence of a force majeure,the Party claiming the right to temporarily suspend its performance, shall give notice to all the Parties, including a detailed explanation of the force majeure and a description of the action that will be taken to remedy the force majeure and resume full performance at the earliest possible time. The term "force majeure" shall include events or circumstances that are not within the reasonable control of Party whose performance is suspended and that could not have been avoided by such Party with the good faith exercise of good faith, due diligence and reasonable care. [Signature pages follow] 8 Executed by the Developer and the Town to be effective on January 29, 2018. TOWN OF WESTLAKE, TEXAS 4-22 //&� Laura Wheat, Mayor S-1 DEVELOPER: MRW Investors, LLC, a Texas limited liability company By: LLSF, LLC, a Texas limited liability company Its Manager and Member By:�� Name: Me xdad Moayedi Its: Its Sole Managing Member S-2