Item 4CCITY OF
SOUTH LAKE
MEMORANDUM
November 12, 2013
To: Shana Yelverton, City Manager
From: Alison Ortowski, Assistant City Manager / Interim Director of
Economic Development & Tourism
Subject: Approve Resolution 13-051, a resolution of the City of Southlake,
Texas, approving the terms and conditions of a program to promote
economic development and stimulate business and commercial
activity in the City; authorizing the Mayor to execute an amended
and restated agreement with Southlake Land Holdings, L.P., a
Texas Limited Partnership, by Southlake Land Holdings GP, L.L.C.
a Texas Limited Liability Company, its General Partner for such
purposes; and providing an effective date.
Action
Requested: Approve Resolution 13-051 as noted above.
Background
Information:
The original Chapter 380 Agreement for the Southlake Regional
Medical Center (SRMC) was approved on November 6, 2007.
There have been three prior amendments extending deadlines for
both SRMC and the City and other minor amendments.
Phase I of the Hospital is complete and occupied. The building
permit has been issued for the first Medical Office Building (MOB).
The primary reason for the MOB delay was a market -driven
requirement to obtain financing based on a pre -lease threshold.
This Amendment Four and Restatement includes a restatement of
all the prior amendments as well as new amendments noted in this
table:
Item
Current
Amendment 4
Justification
MOB recently pulled permit;
Section 4.A.ii
primary reason for delay
Begin MOB
June 30,
January 1, 2014
was market -driven
Construction
2013
requirement to obtain
financing based on a pre -
lease threshold.
Section 4.A.ii-MOB
December 31,
New date for MOB
Substantial
2014
June 15, 2015
completion
Completion
Section 5.B.i
June 30,
December 31,
Public Works estimate for
White Chapel
2014
2018
completion
completion
Sections 5.B.iii/5.B.v
Reimbursed
Reimbursed
Projects complete, costs
Reimbursement for
from impact
from impact
known, funds allow
SH 114 Water Line
fees paid,
fees paid,
payment in this FY rather
and off -site Sewer
balance over
balance paid
than over 2 years
Line
two years
this fiscal year
Honorable Mayor and City Council
Resolution 13-051
Page 2 of 2
Financial
Considerations:
Strategic Link:
Citizen Input/
Board Review:
Legal Review
Alternatives:
Supporting
Documents:
Item
Current
Amendment 4
Justification
Several sections —
Not known,
Known and
Where dates are known,
Other performance
but set in time
actual date
they are now inserted
dates
periods
stated
Section 9.E —
Assignments Number
Language
Reflects assignments of
One and Two (Done
Not
included to
Hospital and MOB as
administratively for
applicable
reflect actual
allowed by Agreement
both Hospital and
assignments
MOB)
A minor change related to financial considerations is an
amendment reimbursing the developer for the SH 114 Water Line
and the off -site Sanitary Sewer in one fiscal year rather than two.
Chief Financial Officer Sharen Jackson has indicated that it is less
cumbersome to pay these smaller amounts in this fiscal year rather
than make separate payments over the course of two years. All
other financial components remain the same, only timing is
changed.
C4: Attract and keep top -tier businesses to drive a dynamic and
sustainable economic environment.
Not applicable.
The City Attorney's office has been involved in the preparation of
these documents.
1. Approve the Resolution as submitted
2. Approve the Resolution with amendments
3. Take no action on the Resolution.
Attached is Resolution 13-051
Staff
Recommendation: Approve Resolution 13-051 as submitted.
RESOLUTION NO. 13-051
A RESOLUTION OF THE CITY OF SOUTHLAKE, TEXAS, APPROVING
THE TERMS AND CONDITIONS OF A PROGRAM TO PROMOTE
ECONOMIC DEVELOPMENT AND STIMULATE BUSINESS AND
COMMERCIAL ACTIVITY IN THE CITY; AUTHORIZING THE MAYOR TO
EXECUTE AN AMENDED AND RESTATED AGREEMENT WITH
SOUTHLAKE LAND HOLDINGS, L.P., A TEXAS LIMITED PARTNERSHIP,
BY SOUTHLAKE LAND HOLDINGS GP, L.L.C. A TEXAS LIMITED
LIABILITY COMPANY, ITS GENERAL PARTNER FOR SUCH PURPOSES;
AND PROVIDING AN EFFECTIVE DATE.
WHEREAS, Chapter 380 of the Texas Local Government Code authorizes
municipalities to establish and provide for the administration of programs that promote
economic development and stimulate business and commercial activity in the City; and
WHEREAS, On November 6, 2007, by Resolution No. 07-016, the City Council
approved a Chapter 380 Agreement (the "Agreement") by and between the City of
Southlake and Southlake Land Holdings, L.P. ("Southlake Medical") to promote economic
development and stimulate business and commercial activity in the City; and
WHEREAS, On August 4, 2009, by Resolution No. 09-028, the City Council
approved Amendment One to the Agreement by and between the City of Southlake and
Southlake Medical to promote economic development and stimulate business and
commercial activity in the City; and
WHEREAS, On January 5, 2010, by Resolution No. 10-002 the City Council
approved Amendment Two to the Agreement by and between the City of Southlake and
Southlake Medical to promote economic development and stimulate business and
commercial activity in the City; and
WHEREAS, On November 1, 2011, by Resolution No. 11-049, the City Council
approved Amendment Three to the Agreement by and between the City of Southlake and
Southlake Medical to promote economic development and stimulate business and
commercial activity in the City; and
WHEREAS, Southlake Medical and the City wish to further amend and, for ease of
review, restate the Agreement, as previously amended by Amendment One and
Amendment Two and Amendment Three; and
WHEREAS, the City Council has been presented with a proposed Amendment Four
and Restatement by and between the City of Southlake and Southlake Medical, a copy of
which is attached hereto as Exhibit "A" and incorporated herein by reference (hereinafter
called "Amendment Four"); and
WHEREAS, upon full review and consideration of Amendment Four and all matters
attendant and related thereto, the City Council is of the opinion that Amendment Four will
assist in implementing a program whereby economic development will be promoted and
business and commercial activity will be stimulated in the City.
Resolution 13-051 - Forest Park Medical Center at Southlake
380 Agreement - Amendment Four and Restatement - Page 1 of 3
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF SOUTHLAKE, TEXAS, THAT:
SECTION 1.
The City Council finds that the terms of Amendment Four will promote economic
development and stimulate business and commercial activity in the City and otherwise
meet the criteria of Section 380.001 of the Texas Local Government Code.
SECTION 2.
The City Council hereby adopts amendments to the economic development program
whereby the City of Southlake will make economic development program payments to
Southlake Medical, and take other specified actions, in accordance with the terms outlined
in the Agreement, Amendments One, Two, Three and Four.
SECTION 3.
The terms and conditions of Amendment Four, having been reviewed by the City
Council of the City of Southlake and found to be acceptable and in the best interest of the
City and its citizens, are hereby approved.
SECTION 4.
The Mayor is hereby authorized to execute the Amendment Four and all other
documents in connection therewith on behalf of the City substantially according to the
terms and conditions set forth in Amendment Four.
SECTION 5.
This Resolution shall become effective from and after its passage.
PASSED AND APPROVED this the day of
John Terrell, Mayor
ATTEST:
Alicia Richardson, TRMC
City Secretary
.2013
Resolution 13-051 - Forest Park Medical Center at Southlake
380 Agreement - Amendment Four and Restatement - Page 2 of 3
EXHIBIT A
Chapter 380 Agreement - Amendment Four and Restatement
Resolution 13-051 - Forest Park Medical Center at Southlake
380 Agreement - Amendment Four and Restatement - Page 3 of 3
AMENDMENT FOUR AND RESTATED ECONOMIC DEVELOPMENT
PROGRAM AGREEMENT
(Chapter 380 Agreement)
This Amendment Four and Restated Economic Development Program
Agreement (the "Agreement") is made and entered into by and between the City of
Southlake, Texas (the "City"), and Southlake Land Holdings, L.P. ("Southlake
Medical') a Texas limited partnership, organized under the laws of Texas.
WITNESSETH:
WHEREAS, on November 6, 2007, the City adopted Resolution No. 07-016 (the
"Resolution") establishing an Economic Development Program pursuant to Section
380.001 of the Texas Local Government Code ("Section 380.001") and authorizing this
Agreement as part of the Economic Development Program established by City Council
Resolution (the "Program"); and
WHEREAS, on August 4, 2009, the City adopted Resolution No. 09-028 adopting
amendments to the Agreement ("Amendment One"); and
WHEREAS, on January 5, 2010, the City adopted Resolution No. 10-002
adopting amendments to the Agreement ("Amendment Two'), and
WHEREAS, on November 1, 2011, the City adopted Resolution No. 11-049
adopting amendments to the Agreement ("Amendment Three"); and
WHEREAS, Southlake Medical and the City wish to further amend and (for ease
of review) restate the Agreement, as amended by Amendment One and Amendment
Two and Amendment Three; and
WHEREAS, the City Council of the City of Southlake (the "City Council") finds
and determines that this Agreement will effectuate the purposes set forth in the
Program, and that the Southlake Medical's performance of its obligations herein will
promote local economic development and stimulate business and commercial activity in
the City; and
NOW, THEREFORE, in consideration of the mutual benefits and premises
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows:
1. Authorization
The City has concluded that this Agreement is authorized by Section 380.001,
and is authorized by Resolution of the City Council.
Forest Park Medical Center - 380 Agreement - Amendment Four and Restatement - 2013-11-12 - Page 1 of 18
2. Definitions
The following definitions shall apply to the terms used in this Agreement:
Building Permit: A permit issued by the City authorizing one to construct,
enlarge, alter, repair, move, improve, remove, or convert any building or structure or
portion thereof regulated by the City's building, plumbing, electrical, fire, energy,
mechanical, and related codes. Issuance of a demolition permit for any portion of the
Property will not trigger any actions, obligations or time periods under this Agreement.
City- The City of Southlake, Texas.
Certificate of Occupancy: A temporary or permanent certificate of occupancy as
defined in the City's building codes.
Concept Plan: The concept plan for the Property, attached hereto as Exhibit B,
approved by the City pursuant to the City's zoning regulations, or as may be amended.
Construction Costs: The cost of design, construction document preparation,
bidding, permits and fees, surveying, building and structured parking construction, site
improvements, landscaping, site grading and such other reasonable industry --standard
costs.
Effective Date: The date that all parties have executed this Agreement.
Eligible Improvements: All or a portion of the Hospital buildings generally shown
as buildings "P1" and "P2" on the Concept Plan, Medical Office Buildings attached via
enclosed pedestrian access ways to the Hospital and generally shown as "MOB 1-4" on
the Concept Plan, a long term acute care hospital (LTACH) located within the Hospital
occupying not more than 25 percent of the floor area of the Hospital, and parking and
accessory improvements related to these improvements.
Force Maieure: Any acts of God or the public enemy, war, riot, civil commotion,
insurrection, governmental or defacto governmental action, (except actions taken by the
City pursuant to or permitted by the terms of this Agreement, and except actions taken
as a result of acts or omissions of Southlake Medical), fire, explosion or flood, and
strikes or other act beyond the reasonable control of Southlake Medical, or the City.
Hospital: The professional buildings generally shown as "P1" and "P2" on the
Concept Plan and having integrated medical services such as: operating rooms,
radiology, CT Scan, MRI, pathology lab, in -patient pharmacy, emergency room, physical
therapy services, and women's services, but not a nursing home, senior living facility,
Forest Park Medical Center - 380 Agreement - Amendment Four and Restatement - 2013-11-12 - Page 2 of 18
Medical Office Buildings generally shown as "MOB 1-6" or building "P3" as generally
shown on the Concept Plan.
Land Value: As defined by the Tarrant Appraisal District.
Medical Campus: A multiple building development including a hospital, medical
office buildings, surface and structured parking, acute care facility, and various medical
and senior living facilities and other related or accessory uses. The proposal is for a
campus setting of multiple buildings up to 90 feet in height, surface and structured
parking, and care -flight heliport accommodations. Amenities include open space and
water features. Architectural character is to be a "timeless style" utilizing concrete,
brick, stone, steel structured frame, stucco and/or efis.
MOB: A Medical Office Building (MOB) occupied primarily by medical physicians.
New Construction: New construction associated with the Medical Campus
including first tenant finish out of shell space. New Construction does not include future
renovations or tenant changes within the Project.
Person: An individual or a corporation, partnership, trust, estate, unincorporated
organization, association, or other entity.
Personal Property: As defined by the Texas Tax Code.
Program: Has the meaning set forth in the recitals to this Agreement.
Program Payments: The payments made by the City to Southlake Medical
pursuant to Section 5 of this Agreement.
Project: The Eligible Improvements.
Property: The approximate 30 acres located south of S.H. 114 and east of White
Chapel Blvd., being real property located in Tarrant County, Texas, as more particularly
described on Exhibit A herein.
Real Property: As defined by the Texas Tax Code.
Section 380.001: Has the meaning set forth in the recitals to this Agreement.
Forest Park Medical Center - 380 Agreement - Amendment Four and Restatement - 2013-11-12 - Page 3 of 18
Southlake Medical Affiliate: Southlake Texas Medical Development, L.P.,
Southlake Texas Medical Building I, L.P., or any Person directly controlling or controlled
by, Southlake Medical, or any Person controlling or controlled by the same Person who
is controlling or is controlled by Southlake Medical. As used in this definition, the term
"control" means ownership or the power to direct or cause the direction of the
management and policies of a Person, whether through ownership of voting securities,
by contract or otherwise.
Substantial Completion: The date a Certificate of Occupancy is issued.
Taxable Value: Values as determined by the Tarrant Appraisal District.
3. Term
This Agreement shall be effective as of the Effective Date of execution by all
parties and shall terminate upon completion of the Program Payments, unless earlier
terminated pursuant to Section 6.
4. Southlake Medical Covenants
In consideration and as a prerequisite of the City's incentives under this
Agreement, Southlake Medical agrees to:
A. Construction: As it relates to constructing a portion of the Eligible
Improvements, the following criteria shall apply.
Hospital & Parking Garage: Commence construction of the Hospital
and attached parking garage (as shown on the Concept Plan) by
March 31, 2012 and be substantially completed no later than
December 31, 2013, which requirements were timely satisfied. The
certificate of occupancy for the Hospital and the attached parking
garage were issued on April 24, 2013. The Hospital contains more
than 130,000 gross square feet and the Hospital and parking garage
together have a construction value of more than Forty -Two Million
Five Hundred Thousand Dollars ($42,500,000). Additionally, as of
January 1, 2014, in order to qualify for Program Payments under this
Agreement, the Hospital and parking garage shall satisfy at least one
of the following conditions: (1) combined Construction Costs and
Taxable Value of the Personal Property within the Hospital of not less
than Forty -Six Million Five Hundred Thousand Dollars ($46,500,000);
or (2) combined Taxable Value of the real property improvements and
Personal Property within the Hospital of not less than Forty -Six Million
Five Hundred Thousand Dollars ($46,500,000).
Forest Park Medical Center - 380 Agreement - Amendment Four and Restatement - 2013-11-12 - Page 4 of 18
ii. Medical Office Building (MOB): Commence construction of the first
MOB by January 1, 2014 and be substantially completed no later than
June 15, 2015, subject to extension as set forth in Section 4.A.iii
below. The MOB shall have a minimum of 60,000 gross square feet
and have a minimum construction value of Seven Million Five Hundred
Thousand Dollars ($7,500,000). Additionally, as of the January 1 of the
year following the issuance of the certificate of occupancy for the MOB,
in order to qualify for Program Payments under this Agreement, the
MOB shall satisfy at least one of the following conditions: (1) combined
Construction Costs and Taxable Value of the Personal Property within
the MOB of not less than Eight Million Five Hundred Thousand Dollars
($8,500,000); or (2) combined Taxable Value of the real property
improvements and Personal Property within the MOB of not less than
Eight Million Five Hundred Thousand Dollars ($8,500,000).
iii. Extensions: Southlake Medical shall have additional time to complete
the first MOB (1) if in the sole opinion of the City, Southlake Medical
has made substantial progress towards the completion of the MOB, or
(2) in the event of Force Majeure.
iv. Construction: Southlake Medical agrees and covenants that it will
diligently and faithfully in a good and workmanlike manner pursue (or
cause to be pursued) the completion of the Eligible Improvements as a
good and valuable consideration of this Agreement. Southlake
Medical further covenants and agrees that all construction of the
Medical Campus will be in accordance with all applicable state and
local laws and regulations or valid waiver thereof.
B. Continuous Operation: In further consideration, from the date a Certificate
of Occupancy is issued until the expiration of this Agreement, Southlake
Medical covenants and agrees that the Property will be continuously
operated, maintained and occupied as a Hospital and Medical Office
Building, except in the event of Force Majeure.
C. Inspection: Southlake Medical further agrees that the City and its agents
and employees, shall have reasonable right of access to the Property to
inspect the Eligible Improvements in order to insure that the construction
of the Eligible Improvements are in accordance with this Agreement and
all applicable state and local laws and regulations or valid waiver thereof;
and subject to Southlake Medical's reasonable security requirements, the
continuing right to inspect Property to insure that the Property are
thereafter maintained, operated and occupied in accordance with this
Agreement.
Forest Park Medical Center - 380 Agreement - Amendment Four and Restatement - 2013-11-12 - Page 5 of 18
D. Ad Valorem Taxes: Not be delinquent on payment of ad valorem property
taxes for the term of this Agreement.
E. Park Dedication Offsets: Prerequisites to waiving the park dedication fee
shall include:
Saved Tree Grouping: An area of existing trees along S.H. 114
shall be substantially preserved as illustrated on the Concept Plan.
ii. Enhanced Water Features: Construction of entry fountains in the
first phase and retention and/or detention ponds for future phases
as shown on the Concept Plan.
F. Naming: The Medical Campus shall be entitled "Forest Park Medical
Center at Southlake" or such other similar name, but must include
"Southlake" in the title.
G. R.O.W. Dedication: Satisfied - Intentionally deleted.
H. Design: The Medical Campus shall substantially conform with the Concept
Plan.
I. Documentation: Submit to City, as a condition of payment of any
incentive, reasonably detailed evidence of compliance with Section 4
herein.
J. Compliance: Comply with any and all remaining terms and provisions
herein.
5. City's Development Program Incentives
Subject to Southlake Medical's performance of its obligations as required by this
Agreement, and subject to the provisions of this section, to promote local economic
development pursuant to the Program, the City shall grant Southlake Medical the
following incentives:
A. Financial Assistance: The City shall provide a grant equal to eighty
percent (80%) of the ad valorem real and personal property taxes paid
within the Property related to Eligible Improvements constructed and
Personal Property located within the Eligible Improvements on the
Property.
Forest Park Medical Center - 380 Agreement - Amendment Four and Restatement - 2013-11-12 - Page 6 of 18
First Payment: The first grant shall be paid based on the assessed
value determined as of January 1, 2014 (the year after the first
Certificate of Occupancy was issued) and within 90 days after the
taxes have been paid and received by the City (which may be
January 2015).
ii. Eligibility: The grant shall be paid within 90 days after the taxes
have been paid and received by the City during each year which
the performance requirements are met until January 1, 2024 (ten
(10) years from the first January after the first Certificate of
Occupancy as noted in Section 5.A.i above).
iii. Appeals: Any grant overpayments shall be refunded to the City
within 30 days after resolution of any appeals regarding the
Taxable Value of the Eligible Improvements.
iv. Land Excluded: This incentive does not include the base year or
future year Land Values.
V. Condition Precedent: Notwithstanding any other provisions hereof,
City shall not be obligated to make any Program Payment or other
payment or grant pursuant to this Agreement unless and until
Southlake Medical is in compliance with the provisions of this
Agreement in all material respects.
B. Infrastructure Assistance:
White Chapel: City shall construct White Chapel Blvd. to its ultimate
arterial 4-lane divided (A4D) section between S.H. 114 and through
the Highland Street intersection by December 31, 2018.
ii. Highland Street: Intentionally Deleted.
iii. Water Lines: The City agrees to reimburse Southlake Medical
$72,208 for all costs, exclusive of interest costs, related to
designing and constructing a minimum twelve inch (12") water line
within the Property for 1,232 linear feet along the south side of S.H.
114 (the "S.H. 114 Water Line"). The S.H. 114 Water Line was
constructed by Southlake Medical concurrent with the development
of the Project. Southlake Medical or its Affiliates paid $91,257.20 in
water impact fees in connection with the construction of the
Hospital and the attached parking garage. Upon receipt of
Forest Park Medical Center - 380 Agreement - Amendment Four and Restatement - 2013-11-12 - Page 7 of 18
satisfactory documentation from Southlake Medical, the City will
reimburse the $72,208 cost of the S.H. 114 Water Line out of the
collected water impact fees in one payment prior to September 30,
2014.
iv. Sewer Capacity: The City shall be responsible for ensuring
adequate downstream sanitary sewer capacity for the Medical
Campus.
V. Off -Site Sanitary Sewer Line: The City agrees to reimburse
Southlake Medical $ 63,966 for all costs, exclusive of interest costs,
related to designing and constructing the twelve inch (12") sanitary
sewer line from the northeast corner of the Property easterly along
S.H. 114 for 730 linear feet to the existing manhole on the existing
12" sewer line ("Off -site Sewer Line"). Southlake Medical provided
the City all documentation and exhibits necessary to acquire
adequate off -site easements and/or right-of-way for this line. The
City acquired all easements and right-of-way necessary to
construct the line. Southlake Medical or its Affiliates paid
$49,618.80 in wastewater impact fees in connection with the
construction of the Hospital and the attached parking garage. Upon
receipt of satisfactory documentation from Southlake Medical, the
City will reimburse the $63,966 cost of the Off -Site Sewer Line in
one payment prior to September 30, 2014.
vi. Trail Along Highland Street: The City shall be responsible for any
required trails along the south side of Highland Street, likely
constructed with the ultimate improvement of Highland. Southlake
Medical shall be responsible for construction of a minimum five foot
(5) wide sidewalk along the north side of Highland Street adjacent
to the Property located within the Highland Street right-of-way with
each phase of the development in accordance with zoning
approval.
- The remainder of this page blank on purpose -
Forest Park Medical Center - 380 Agreement - Amendment Four and Restatement - 2013-11-12 - Page 8 of 18
C. Fee Reductions:
Subject to C.ii below, the City shall waive fifty percent (50%) of the
administrative and construction inspection fees outlined below for
all New Construction on the Property paid to date through March
23, 2017, five (5) years from the date of the first Building Permit
issued for the Project ("Fee Reductions"). Southlake Medical shall
pay all other fees as they are normally required. Fee Reductions
include, but are not limited to the following:
a. Zoning and Platting Fees: This shall include applications for
changes in zoning, specific use permits, site plans, concept
plans, subdivision platting or re -platting.
b. Building Permit and Inspection Fees: Fees related to
Building Permits, unless noted as excluded below.
C. Public Works Plan Review and Inspection Fees: Fees
associated with the review of construction plans related to
public works components of the Project (i.e. water, sanitary
sewer, streets and drainage) as well as inspection of those
same components.
Cl. Excluded Items: The following fees are excluded from this
incentive:
(i) Third Party Fees: Fees where the City must send
plans / construction documents to outside
professionals for their review due to the unique nature
of the Project. Anticipated at this time are fees
related to fire protection systems for the Project. Due
to the unique nature of the Project, other outside
professionals may also be required to review certain
aspects of the Project construction plans.
(ii) Re -Inspection Fees: Fees associated with "call-back"
inspections outside of the inspections provided for by
the building permit fee.
(iii) Over -time Fees: Fees associated with over -time
requests for work outside normal working hours,
weekends or official City holidays.
Forest Park Medical Center - 380 Agreement - Amendment Four and Restatement - 2013-11-12 - Page 9 of 18
ii. In the event Southlake Medical fails to Substantially Complete the
Eligible Improvements as required by Section 4.A, Southlake
Medical agrees to pay the City an amount equal to the fees waived
herein.
D. Park Dedication Requirements: The City shall waive the park dedication
requirements as long as performance requirements previously identified
are met.
E. Entitlement Processes: The City shall endeavor to facilitate the Project
through dedicated Development Review Committee (DRC) meetings,
combined departmental meetings for coordination, shortened plan review
turnarounds, etc. All public entitlement phases (SPIN, Planning and
Zoning Commission, City Council) shall be required.
6. Default and Termination
If either party should fail to comply with the terms of this Agreement, the party
shall have 30 days after delivery of written notice of such default from the other party to
cure such default. If the noncompliance is not cured within that period, the non -
defaulting party may terminate this Agreement by written notice and shall have no
further obligation to the other party; provided that the City shall grant Southlake Medical
an extension to cure the default if Southlake Medical demonstrates, to the reasonable
satisfaction of the City Council that: the default cannot be cured by the payment of
monies and (2) cannot be reasonably cured within 30 days and (3) that Southlake
Medical is diligently pursuing cure. Notwithstanding the foregoing, in the event either
party fails to pay the other party any monetary amounts owing under this Agreement
when due, and such failure continues for a period of 30 days after delivery of written
notice of such default, then such outstanding amounts shall accrue interest from the
date owing until paid at the rate of seven and one half percent (7.5%) per annum.
If the Hospital is not built in accordance with this Agreement or the Hospital has
during the term of this Agreement a property tax exempt status, the City may terminate
the Agreement and Southlake Medical shall refund to the City the costs incurred or
waived by the City for the State Highway 114 Water Line, Off -site Sewer Line, Off -site
Sewer Easement and Fee Reductions. Additionally, without terminating the Agreement,
Southlake Medical, after notice and opportunity to cure, may exercise any legal or
equitable rights and remedies to collect amounts owing and enforce the obligations
contained in this Agreement.
Forest Park Medical Center - 380 Agreement - Amendment Four and Restatement - 2013-11-12 - Page 10 of 18
7. Audit
If necessary to determine whether the minimum Construction Costs in Section
4.A are met and if requested by the City, an independent accounting firm mutually
agreeable to the City and Southlake Medical (the "Auditor") shall audit the Construction
Costs associated with the Eligible Improvements, and shall determine whether
Southlake Medical has met the minimum Construction Cost criteria. The conclusion of
the Auditor shall be final, binding and conclusive on the City and Southlake Medical and
the City's payments shall be adjusted in accordance therewith. The City shall be
responsible for the cost of the audit.
8. Indemnification
A. SOUTHLAKE MEDICAL EXPRESSLY AGREES TO FULLY AND
COMPLETELY DEFEND, INDEMNIFY, AND HOLD HARMLESS THE
CITY, AND ITS OFFICERS, AND EMPLOYEES, AGAINST ANY AND
ALL CLAIMS, LAWSUITS, LIABILITIES, JUDGMENTS, COSTS, AND
EXPENSES FOR PERSONAL INJURY (INCLUDING DEATH),
PROPERTY DAMAGE OR OTHER HARM, DAMAGES OR LIABILITY
FOR WHICH RECOVERY OF DAMAGES IS SOUGHT, SUFFERED BY
ANY PERSON OR PERSONS, THAT MAY ARISE OUT OF OR BE
OCCASIONED BY ANY NEGLIGENT, GROSSLY NEGLIGENT,
WRONGFUL, OR STRICTLY LIABLE ACT OR OMISSION OF
SOUTHLAKE MEDICAL OR ITS AGENTS, EMPLOYEES, OR
CONTRACTORS, ARISING OUT IN THE PERFORMANCE OF THIS
AGREEMENT, REGARDLESS OF WHETHER OR NOT THE
NEGLIGENCE, GROSS NEGLIGENCE, WRONGFUL ACT, OR FAULT
OF THE CITY OR ITS OFFICERS, AGENTS, OR EMPLOYEES,
CONTRIBUTES IN ANY WAY TO THE DAMAGE, INJURY, OR OTHER
HARM. Nothing in this paragraph may be construed as waiving any
immunity available to the City under state law. This provision is solely for
the benefit of Southlake Medical and the City and is not intended to create
or grant any rights, contractual or otherwise, in or to any other Person.
9. Miscellaneous Matters
A. Section or Other Headings: Section or other headings contained in this
Agreement are for reference purposes only and shall not affect in any way
the meaning or interpretation of this Agreement.
B. Attorneys Fees: The prevailing party in the adjudication of any proceeding
relating to this Agreement shall be authorized to recover its reasonable
Forest Park Medical Center - 380 Agreement - Amendment Four and Restatement - 2013-11-12 - Page 11 of 18
and necessary attorney's fees pursuant to Section 271.159 of the Texas
Local Government Code.
C. Entire Agreement: This Agreement contains the entire agreement
between the parties with respect to the transactions contemplated herein.
D. Amendment: This Agreement may only be amended, altered, or revoked
by written instrument signed by the Southlake Medical and the City.
E. Successors and Assigns: This Agreement shall be binding on and inure to
the benefit of the parties, their respective successors and assigns.
Southlake Medical has assigned its rights and obligations hereunder
related to the Hospital to Southlake Texas Medical Development, LP by
assignment dated , 2013. Southlake Medical has assigned
its rights and obligations hereunder related to the first MOB to Southlake
Texas Medical Building I, LP by assignment dated , 2013.
Southlake Medical may assign all or part of its remaining rights and
obligations hereunder (a) to any Southlake Medical Affiliate effective upon
written notice to the City, provided the Affiliate agrees in writing to comply
with each and every obligation of Southlake Medical in this Agreement
including constructing the eligible improvements to a design standard
consistent with the Concept Plan, or (b) to any Person other than a
Southlake Medical Affiliate with the prior written approval of the City, which
approval shall not be unreasonably withheld or delayed, so long as in the
City's sole discretion the Eligible Improvements will be constructed to a
design standard consistent with the Concept Plan. After Substantial
Completion of the Eligible Improvements, this Agreement may be
assigned upon written notice to the City and the assignees written
agreement to comply with each and every obligation of Southlake Medical
contained herein. Notwithstanding any other term of this Agreement or any
assignment of this Agreement, City shall pay Program Payments to
Southlake Medical, which will bear responsibility for making
reimbursements to Southlake Medical Affiliates or other assignees.
F. Notice: Any notice and/or statement required and permitted to be
delivered shall be deemed delivered by hand delivery, depositing same in
the United States mail, certified with return receipt requested, postage
prepaid, addressed to the appropriate party at the following addresses, or
at such other addresses provided by the parties in writing:
Forest Park Medical Center - 380 Agreement - Amendment Four and Restatement - 2013-11-12 - Page 12 of 18
Southlake Medical: Southlake Texas Medical Development GP, LLC
5400 Dallas Parkway
Frisco, Texas 75034
Attention: Jim Williams, Jr.
With a copy to: Neal Richards Group
3030 Olive Street, Suite 220
Dallas, Texas 75219
Attention: Derrick Evers
City: City of Southlake
1400 Main Street, Suite 460
Southlake, Texas 76092
Attention: Mayor
With a copy to: Taylor, Olson, Adkins, Sralla & Elam, L.L.P.
6000 Western Place, Suite 200
1-30 at Bryant -Irvin Road
Fort Worth, Texas 76107
Attention: Betsy Elam
G. Interpretation: Regardless of the actual drafter of this Agreement, this
Agreement shall, in the event of any dispute over its meaning or
application, be interpreted fairly and reasonably, and neither more strongly
for or against any party.
H. Applicable Law and Venue: This Agreement is made, and shall be
construed and interpreted under the laws of the State of Texas and is fully
performable in Tarrant County, Texas, and venue of any dispute relating
to this Agreement shall lie in Tarrant County, Texas.
Counterparts: This Agreement may be executed in multiple counterparts,
each of which shall be considered an original, but all of which shall
constitute one instrument.
J. Limitation on Liability: Southlake Medical agrees that City shall not be
liable to Southlake Medical or any other party for any special or
consequential damages, direct or indirect, punitive damages, interest, or
cost of court or expenses related to litigation other than reasonable and
necessary attorney's fees, as provided in Section 9.b. hereof for any act of
default by City under this Agreement.
Forest Park Medical Center - 380 Agreement - Amendment Four and Restatement - 2013-11-12 - Page 13 of 18
K. Representations: Southlake Medical represents and warrants to the City
that it has the requisite authority to enter into this Agreement.
L. No Joint Venture: The parties agree that the terms hereof are not
intended to and shall not be deemed to create a partnership or joint
venture among the parties. The City, its elected officials, directors,
employees and agents do not assume any responsibility to any third party
in connection with Southlake Medical's construction or operation of the
Project.
10. Right to Offset
City may, at its option, offset any amounts due and payable to Southlake Medical
under this Agreement against any debt (including taxes) lawfully due to City
from Southlake Medical and which are delinquent under applicable law or by
agreement, regardless of whether the amount due arises pursuant to the terms of this
Agreement or otherwise and regardless of whether or not the debt due to City has been
reduced to judgment by a court, provided that if Southlake Medical is in good faith
challenging the validity of any debt, in accordance with applicable laws, the City may not
offset unless and until such challenge is finally resolved.
11. Rough Proportionality
Southlake Medical agrees that all property dedicated to the City and all public
facilities constructed pursuant to this Agreement are reasonably necessary to serve the
Project and are roughly proportional to the need generated by the subdivision for such
land and facilities. Southlake Medical acknowledges its right to seek a variance to the
dedication and/or construction requirements and that it has voluntarily chosen not to
pursue such remedies and waives any claim for a taking of property, or any other
constitutional or statutory claim, that it may have under either the Texas or United
States Constitutions or statutes.
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Forest Park Medical Center - 380 Agreement - Amendment Four and Restatement - 2013-11-12 - Page 14 of 18
IN WITNESS WHEREOF, the City and Southlake Medical have executed this
Agreement as of the day of , 2013.
THE CITY OF SOUTHLAKE
John Terrell, Mayor
ATTEST:
Alicia Richardson, TRMC
CITY SECRETARY
SOUTHLAKE MEDICAL
SOUTHLAKE LAND HOLDINGS, L.P.,
a Texas limited partnership
By: Southlake Land Holdings GP, L.L.C., a
Texas limited liability company, its General
Partner
go
APPROVED AS TO FORM:
CITY ATTORNEY
Jim Williams, Jr., President
Forest Park Medical Center - 380 Agreement - Amendment Four and Restatement - 2013-11-12 - Page 15 of 18
EXHIBIT A-1
Description of Property
Forest Park Medical Center - 380 Agreement - Amendment Four and Restatement - 2013-11-12 - Page 16 of 18
EXHIBIT A-2
Description of Property
MISTES AND BouNs S a]e=PTION
6i:1NG a 30.017 acre tract of land eitualed in the Larkin H. ChIvem Survay, Abstroat Number 300. Tarronk County, Texas,
being o portldn of the 25.395 aorta track of- Iand doffigribed irk the deed to LO. RrkghtlAl JII, and wife, Roth, C. SrfobWl
recorded In Volurne 68S9, Page 815, Dead Racorda of 7cfrcnt County, Texan, also baring dl of the remalmkr of,tot 1, Gloak
1, Srlghtbill ,ldditfan, accwrdlnj to the plot recorded in Volume 380--1162, Page 73. Plat itecards of Tarrant County, Texas,
nrrd oil of Tract 1, Track 2, and Tract 3 described In the Cloud to Mork C. E3rlghtbdg, Amy P. Urlghtl4l, Ann M, 8dgghtbgl,
Oratltfa K. Brlghklxlll recorded In Volume 15575. Purge 60, Dged Raeard$ of T-OrrQnt County, Texas. eol-1 30.017 acre tWt of
Iand being mare pflrtloulorly described as follows;
BEGINNING ok n 5/S Inch Iron rod with a yellow ploetic cap wWmpad '"Dukvmy Mow, Inc-" sat In the narkherty rlght-of-;yoy
line of 'HIIINiond Drive (a warloble width ri t-of-Wd fort " southwesterly corner of Tract I described in acid dead to Mark
C. er1ghtib I, Amy P. E'frlghtbill, Arun ki. E i4lblll, Cyn ld K, Srighiblirl
THENCE with the matarly line of black A-80, Pack AddMcn, d000rekng to the plat recorded in Vciume 38-137, P-Dge tat,
Plat Re-c&da, Tarrant Omhty, Texan, Nprkh 02'WOW Wont a dletanae of 5883 65 feet to a 5/8 inch Iran rod with o yellow
ploatld oop Stamped "Dunaway Aaaoc, Ina." net for the monk southerly corner of Tract 1, Black 1. Chlwa Addidai n, ncrording
to tho plat reaardetk In Volurne 3BB--$42, Pcge 142, Plot Records of Tarrant C'auntyr Texas;
THENCE with the $mt -arly Ilr,o of SkXk 1 of sued Chlvers Addltlon, East a distance of 4132,06 feat to a 1/2 Inch iron rod
found for the sautlyecsierly career of Trod S, Slock 1, of sold Ghlvars Addition;
THEMa dopvrVng the owthedy lfnl« of Block 1 of e*10 Chfvers AddItIon, North 26104OO" EoO a distance of 516.21 feet to a
5/8 meh Iron rod wits+ P yell** pUpstlC cup stomped "Oungwuy Aswe, InCr. set En the saukhariy right-ol-way line of State
Highway 114 (a varlabke width rfght-of--way), a non -tangent curve to th& riegnt, tb@ ra4lua point of snid curve$ baing altuoted
South 17122'48" treat 4 dlekun-Pe qf $563,U feet from add ion rah, from which a Taw u I}epar*orrt of Trarreportortkcn
highway mcxiurnent bears North 72437'50' Weak a hletanoe' of 1.71 feet,,
THENCE with said esouthedy rWrt-of--way line of State Hloway 114 the follawln3 -,
SiDuthtieaeerly along exlki curva through a central angfa of N*26'24' do arc length of 751,90 feet wrtn o Chtiord bearng
of South 67'54'00" Cask and h chord dEclancc of 751.05 feat 10 a 5/6 Inch iron rod with o cap stamped P'Dunoway
Assoc, Inc." for the end of Bald curve;
South 6223'20" East a distance of 185.71 leak to a 5/4 In& rnm rod wile a pop stcwpad "Dunawoy Assoc, hoc." set
of the heghrrng of a non -tangent curve to the right, the rpdiva point of scad curve lmrnp eituoted south 2618019"
West a dkatanca of 7,529.44 feet fr6m said Iran rod;
Southeasterly along said curva through a central dngia of 01128'S9' aes arc length of 164.87 foal with a chord bearing
of South 60'57'13' Poet and Q chard dlstimce of 1 t 80 feet to -q 1 %2 inch Iron rod found for the narthwlestetriy corner
of Lot 1, Block 1, Brkpkhill Addltian, omorc8ng taw thg plot r000rd9d fine VoLumo 388-16Z Pogo 73, Plat Reoarda of
Tarrant County, Texas;
THENCE deporth) the southerly rjht-of-way Ilne of Stake Hlgliway..114 with the westerly Ilne of sold Lot Y, Block 1.
Srtghthil Addltkn, South 00°2e00 Eout a dlatanee of 562.65 feet to a 5/8 Indh raid with o cap starnp*d "Dunmray
Ausce. Inc.' sot In the northarly rNht-of--way line of 1-1191and Drive (a vM.Nobm wk" dot. -of -way), aceoMling to the
Brightbill Addition, for the southwestefiy corner of naW Lot 1;
THENCE with the norkhsdy rWt-of-way We of Highland Drive, South 89'55'113" Weak a distance of %034,74 feet k4;� a 5/8
Inch Iron rod with a cap stamped 'bunaway Aesoa; Inc." set In the westerly Ilne of Tract 3 of said dud to Mork C.
BrlghtbRl, Army F. Brlghtblll, Ann M, F41ghtbill, Cynthia KL Br otblll;
TKFNCE deporting the riortherly rrghl-of-wpy line of Highland Drive +nfth the westerky line of Tract 3 of sold deed to Mark C.
Brightbill, Amy P: Bright0l, AM M, BrlghtUll, Cyrithlo K. 13rightb1II, South o -dietonce of 24.00 feet to a 5/8 Inch Iron ro-d
with a Cop slumped 'Dunawoy Aeeoc, Inc." set in the northerly right -of --way lase of HiQhkmd Drive, for the southagsterly
comer of Bald Track 3;
ThtiENC,E with the northerly ri5ht--n1-vray line of Highland ariwe, South 59'56'30" ,,feat o dietonaa of 687," feet to tho POINT
OF UEOIN INNING;
CMUNING a computed area of 30.017 acres (1.507,532 sgwora feet) of land.
Forest Park Medical Center - 380 Agreement - Amendment Four and Restatement - 2013-11-12 - Page 17 of 18
EXHIBIT B
Concept Plan
MAX
Forest Park Medical Center '3DDAgreement Amendment Four and Restatement 2013'11'12 Page 18ofl8