19-R-46 - EDC Program Expenndiures Phase II Schertz 312 LLCRESOLUTION NO. 19 -R -46
A RESOLUTION BY THE CITY COUNCIL OF THE CITY OF
SCHERTZ, TEXAS AUTHORIZING A PROGRAM AND
EXPENDITURES AS PROVIDED FOR IN THE PHASE II ECONOMIC
DEVELOPMENT PERFORMANCE AGREEMENT BETWEEN THE
CITY OF SCHERTZ ECONOMIC DEVELOPMENT CORPORATION
(THE "SEDC ") AND SCHERTZ 312, LLC (THE "COMPANY "); AND
OTHER MATTERS IN CONNECTION THEREWITH.
WHEREAS, the Development Corporation Act of 1979, as amended (Section 501.001 et
seq, Texas Local Government Code, formerly the Development Corporation Act of 1979) (the
"Act ") authorizes a development corporation to fund certain projects as defined by the Act and
requires development corporation'to enter into performance agreements to establish and provide
for the direct incentive or make an expenditure on behalf o_ f a business enterprise under a project;
and
WHEREAS, Section 501.103 authorizes expenditures for certain infrastructure
improvement projects that are found by the board of directors to be required or suitable for
infrastructure necessary to promote or develop new or expanded business enterprises; and
WHEREAS, Section 501.158 of the Act requires an incentive agreement to provide at a
minimum for a schedule of additional payroll or jobs to be created or retained and capital
investment to be made as consideration for any direct incentives provided or expenditures made
by the corporation under the agreement and to specify the terms under which repayment must be
made if the business enterprise does not meet the performance requirements specified in the
agreement; and
WHEREAS, Section 501.159 of the Act requires that a corporation hold at least one
public hearing on the proposed project before spending money to undertake the project, the
public hearing was held on March 28, 2019; and
WHEREAS, the SEDC Board of Directors approved SEDC Resolution 2019 -5 which,
subject to the authorization of funds by the City of Schertz City Council, approved the Economic
Development Performance Agreement Schertz 312 — Phase II agreement attached hereto as
Exhibit A between the SEDC, and the Company, pursuant to the Act, and the SEDC's Board of
Directors meeting on March 28, 2019; and
WHEREAS, Section 501.073 of the Act requires that the corporation's authorizing unit to
approve all programs and expenditures of a corporation; and
WHEREAS, the SEDC has recommended that the City authorize the program and
expenditures associated therewith; and
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
SCHERTZ, TEXAS THAT:
Section 1. The City Council hereby authorizes the program and expenditures as
provided for in the Economic Development Performance Agreement as set forth on Exhibit A.
Section 2. The recitals contained in the preamble hereof are hereby found to be true,
and such recitals are hereby made a part of this Resolution for all purposes and are adopted as a
part of the judgment and findings. of the City Council.
Section 3. All resolutions, or parts thereof, which are in conflict or inconsistent with
any provision of this Resolution are hereby repealed to the extent of such conflict, and the
provisions of this Resolution shall be and remain controlling as to the matters resolved herein.
Section 4. This Resolution shall be construed and enforced in accordance with the
laws of the State of Texas and the United States of America.
Section 5. If any provision of this Resolution or the application thereof to any person
or circumstance shall be held to be invalid, the remainder of this Resolution and the application
of such provision to other persons and circumstances shall nevertheless be valid, and the City
Council hereby declares that this Resolution would have been enacted without such invalid
provision.
Section 6. It is officially found, determined, and declared that the meeting at which
this Resolution is adopted was open to the public and public notice of the time, place, and subject
matter of the public business to be considered at such meeting, including this Resolution, was
given, all as required by Chapter 551, Texas Government Code, as amended.
Section 7. This Resolution shall be in force and effect from and after its final
passage, and it is so resolved.
PASSED AND ADOPTED, this 2nd day of April 2019.
Carpenter, Mayor
ATTEST:
Brenda Dennis, City Secretary
EXHIBIT A
I , �� �.
ECONOMIC DEVELOPMENT PERFORMANCE •
SCHERTZ 312 — PHASE 11
THIS ECONOMIC DEVELOPMENT PERFORMANCE AGREEMENT — SCHERTZ
312 — PHASE H ( "Agreement ") is entered into as of the Effective Date (as defined in Article III
below), by and between the City of Schertz Economic Development Corporation, located in
Guadalupe County, Texas, a Texas non - profit industrial development corporation under the
Development Corporation Act and governed by TEx. Loc. Gov. CODE chapters 501, 502 and 505
and the Texas Non - Profit Corporation Act (hereinafter called "Corporation ") created by and for
the benefit of the City of Schertz, Texas (hereinafter the called the "City "), and Schertz 312, LLC,
a Texas limited liability company, its successors or assigns (hereinafter called "Company "), the
Corporation and the Company collectively known as the "Parties" to this Agreement.
RECITALS
WHEREAS, the Development Corporation Act of 1979, as amended (Section 501.001 et
seq, Texas Local Government Code, formerly the Development Corporation Act of 1979) (the
"Act ") authorizes a development corporation to fund certain projects as defined by the Act and
requires development corporations to enter into performance agreements to establish and provide
for the direct incentive or make an expenditure on behalf of a business enterprise under a project;
and
WHEREAS, Section 501.103 authorizes expenditures for certain infrastructure
improvement projects that are found by the board of directors to be required or suitable for
infrastructure necessary to promote or develop new or expanded business enterprises; and
WHEREAS, Section 501.158 of the Act requires a performance agreement to provide at a
minimum for a schedule of additional payroll or jobs to be created or retained and capital
investment to be made as consideration for any direct incentives provided or expenditures made
by a corporation under the agreement and to specify the terms under which repayment must be
made if the business enterprise does not meet the performance requirements specified in the
agreement; and
WHEREAS, the Company or its affiliates is owner of that certain real property containing
approximately 312 acres of land, of which. 171 acres is within the City of Schertz, Texas ( "Schertz
Land "), and approximately 141 acres located in Comal County, City of San Antonio Extra -
Territorial Jurisdiction, Texas ( "SA ETJ Land "), the Schertz Land and the SA ETJ Land as
described on Exhibit "A" and as approximately depicted on Exhibit "B ", each attached hereto and
incorporated herein by reference;
WHEREAS, the Parties have entered into that Economic Development Performance
Agreement (Schertz 312) made effective May 7, 2018 for the design, engineering and construction
of certain Infrastructure Improvements (as defined therein) upon the Schertz Land ( "Phase I PA');
WHEREAS, the Road Infrastructure as defined herein is a continuation of the
Infrastructure Improvements being constructed pursuant to the terms of the Phase I PA, the design
of which has commenced and is pending approval by the City;
WHEREAS, the City, on behalf of the Corporation, has at its sole cost and expense,
petitioned the City of San Antonio, Texas for the voluntary annexation of the SA ETJ Land into
the City boundaries and such application is currently pending resolution therewith;
WHEREAS, the Company desires to further develop the SA ETJ Land by installing certain
Infrastructure Improvements (as defined below) as more fully set forth herein;
WHEREAS, the Corporation adopted the Schertz Incentive Policy in May 2017 to guide
and ensure consistency when providing incentives within the City to promote economic
development; and
WHEREAS, upon annexation of the SA ETJ Land into the City boundaries, the
Corporation desires to offer an Infrastructure Grant to the Company to enable it to develop the SA
ETJ Land pursuant to this Agreement in substantial conformity with the Schertz Incentive Policy
and the Act; and
WHEREAS, the construction of the Infrastructure Improvements, as proposed, will
contribute to the economic development of the City promoting and developing expanded business
enterprises, increased development, increased real property value and tax revenue for the City; and
will have both a direct and indirect positive overall improvement /stimulus in the local and state
economy; and
WHEREAS, the Parties are executing and entering into this Agreement to set forth certain
terms and obligations of the Parties with respect to such matters herein; and
WHEREAS, the Parties recognize that all agreements of the Parties hereto and all terms
and provisions hereof are subject to the laws of the State of Texas and all rules, regulations and
interpretations of any agency or subdivision thereof at any time governing the subject matters
hereof; and
WHEREAS, the Parties agree that all conditions precedent for this Agreement to become
a binding agreement have occurred and been complied with, including all requirements pursuant
to the Texas Open Meetings Act and all public notices and hearings; if any, have been conducted
in accordance with Texas law; and
WHEREAS, on the Effective Date, the commitments contained in this Agreement shall
become legally binding obligations of the Parties.
NOW, THEREFORE, in consideration of the mutual covenants, benefits and agreements
described and contained in this Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged and further described herein, the Parties
agree as follows:
ARTICLE I
RECITALS
The recitals set forth above are declared true and correct by the Parties and are hereby
incorporated as part of this Agreement.
ARTICLE H
AUTHORITY AND TERM
1. Authority. The Corporation's execution of this Agreement is authorized by the Act
and constitutes a valid and binding obligation of the Corporation. The Corporation acknowledges
that the Company is acting in reliance upon the Corporation's performance of its obligations under
this Agreement in making the decision to commit substantial resources and money to the
construction and establishment of the Project (as defined below), hereinafter constructed and
established.
2. Term. This Agreement shall become enforceable upon the Effective Date,
hereinafter established, and shall continue until the Expiration Date, hereinafter established, unless
terminated sooner or extended by written mutual agreement of the Parties in the manner provided
for herein.
3. Purpose. The purpose of this Agreement is to formalize the agreements between
the Company and the Corporation for the granting of funds to cover certain costs associated with
the Project and specifically state the covenants, representations of the Parties, and the incentives
associated with the Company's commitment to abide by the provisions of the Act and to abide by
the terms of this Agreement which has been approved by the Corporation and the Company as
complying with the specific requirements of the Act. It is expressly agreed that this Agreement
constitutes a single transaction. A failure to perform any obligation by the Parties may constitute
a Default and shall terminate any further commitments (if any) by the non - defaulting Party unless
an alternative penalty or remedy is provided for herein.
4. Administration of Agreement. Upon the Effective Date, the Corporation delegates
the administration and oversight of this Agreement to the Executive Director of the Corporation.
Any proposed amendments to the Agreement shall require the approval of the Board of Directors
of the Corporation.
ARTICLE IH
DEFINITIONS
As used in this Agreement, the following terms shall have the meanings ascribed below.
All undefined terms shall retain their usual and customary meaning as ascribed by common and
ordinary usage.
"Bankruptcy" shall mean the dissolution or termination of a Party's existence as a going
business, insolvency, appointment of receiver for any party of such Party's property and such
appointment is not terminated within ninety (90) days after such appointment is initially made, any
general assignment for the benefit of creditors, or the commencement of any proceeding under any
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bankruptcy or insolvency laws by or against such party and such proceeding is not dismissed
within ninety (90) days after the filing thereof.
"Calendar Year" shall mean January 1 through December 31.
"Certificate of Occupancy" shall mean the signed certificate issued by the City of Schertz
Inspection Division confirming that the entire work covered by the building permit and plans ate
in place for the Facility or Facilities.
"Default" unless otherwise specifically defined or limited by this Agreement shall mean
failure by any Party to timely and substantially comply with any performance requirement, duty,
or covenant set forth in this Agreement.
"Effective Date" shall be the date upon which the last party hereto executes this Agreement.
"Expiration Date" shall mean the earlier of:
1. May 7, 2033;
2. Confirmation from the City of San Antonio that the City's application for
voluntary annexation of the SA EJA Land has been denied and all appeal
options have been thereafter exhausted by the City; or
3. The date of termination provided for under Article VII of this Agreement.
"Facility or Facilities" shall mean one or more vertical commercial or industrial
improvements constructed on SA ETJ Land by Company, its affiliates, successors or assigns.
"Force Majeure" shall mean any contingency or cause beyond the reasonable control of a
Parry, including, without limitation, acts of God or the public enemy, war riot, civil commotion,
insurrection, government or de facto governmental action (unless caused by the intentionally
wrongful acts or omissions of a Party), fires, explosions or floods, strikes, slowdowns or work
stoppages.
"Infrastructure Grant" shall have the meaning set forth in Article IV, Section 1.
"Infrastructure Improvements" shall mean the Road Infrastructure and the Rail Crossing
Infrastructure as defined in Article V, Section 1 below, as approximately depicted in Exhibit "B"
and constructed pursuant to the Road Plan Set and the Rail Crossing Plan Set as defined in Article
V, Section 1.
"Letter of Acceptance" shall mean a signed letter issued by the City accepting the Road
Infrastructure.
"Project" shall mean the design, engineering and construction of the Infrastructure
Improvements.
"Project Costs" shall mean all hard and soft costs incurred by Company for the design,
engineering and construction of the Infrastructure Improvements, and shall specifically include,
but not be limited to, due diligence costs, engineering, surveying, permitting, financing, planning,
and construction, and exclude any management fee for Company.
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"State of Texas" shall mean the Office of the Texas Comptroller, or its successor.
ARTICLE IV
CORPORATION OBLIGATION
1. Infrastructure Grant. Subject to the satisfaction of all the terms and conditions of
this Agreement and the obligation of the Company to repay the Infrastructure Grant pursuant to
Article VIII hereof, the Corporation shall pay the Company, for the Project, the Project Costs
incurred by the Company to design, engineer and construct the Infrastructure Improvements, in
an amount not to exceed TWO MILLION FIVE HUNDRED THOUSAND DOLLARS and
NO /100 ($2,500,000.00), (the "Infrastructure Grant "). The Corporation shall pay the Company
the Infrastructure Grant as follows, each instance of payment being concurrent with, or
independent of, each other:
(a) An amount not to exceed $2,250,000 of the Infrastructure Grant for the
construction of the Road Infrastructure as set forth in Article V, Section I(a) below
upon receipt of the Letter of Acceptance and confirmation that the Company has
paid ONE HUNDRED PERCENT (100 %) of all costs associated thereto.
(b) The lesser of (i) an amount not to exceed $250,000 of the Infrastructure
Grant, or (ii) FIFTY PERCENT (50 %) of the actual Project Costs for the
construction of the Rail Crossing Infrastructure as set forth in Article V, Section 1(b)
below upon receipt of an agreement of acceptance from Union Pacific Railroad
Company or its related or affiliated companies ( "UPRC ") and confirmation that the
Company has paid ONE HUNDRED PERCENT (100 %) of all costs associated
thereto.
2. Current Revenue. The Infrastructure Grant shall be paid solely from lawfully
available funds of the Corporation. Under no circumstances shall the obligations hereunder be
deemed to create any debt within the meaning of any constitutional or statutory provision. The
Corporation represents and warrants that it has funds available for distribution sufficient to fully
and timely pay the full Infrastructure Grant, will reserve such funds solely for such purpose, and
will not make any special or general allocations of the Corporation's current and future funds that
would render the Corporation unable to timely make the full Infrastructure Grant along with its
other obligations. None of the obligations under this Agreement shall be pledged or otherwise
encumbered in favor of any commercial lender and /or similar financial institution.
3. Confidentiality. The Corporation agrees to keep all information and documentation
received pursuant to this Agreement confidential to the extent allowed under the Texas Public
Information Act (TPIA). In the event a request is made for such information, Corporation will
notify the Company and follow the process stated in the TPIA for determining what information
must be released and what information should be withheld until seeking a ruling from the
Attorney General of Texas.
ARTICLE V
PERFORMANCE OBLIGATIONS OF COMPANY
The obligation of the Corporation to pay funds from the Infrastructure Grant shall be
conditioned upon the Company's continued compliance with and satisfaction of each of the
performance obligations set forth in this Agreement.
SA ETJ Land:
Infrastructure Improvements. The Company will perform the following upon the
(a) Construct a road, drainage, utilities and related improvements thereto
( "Road Infrastructure ") from the existing Alamo Parkway as approximately
depicted in Exhibit `B" and as set forth in the plans and specifications for such
improvements ( "Road Plan Set ") as submitted and to be approved by the City. The
Company shall:
1. Construct the Road Infrastructure in accordance with City of Schertz
Public Works Design Specifications, as applicable;
2. Competitively bid all of the Road Infrastructure;
3. Allow access by the Corporation to all construction documents
related to the Road Infrastructure during the term of the Agreement;
4. Dedicate all right -of -way upon which the Road Infrastructure is
constructed per the Road Plan Set to the City without additional
compensation.
(b) Construct a railroad crossing and related improvements thereto ( "Rail
Crossing Infrastructure ") in the location as approximately depicted in Exhibit "B"
and as set forth in the plans and specification for such improvements as determined
by Company to be submitted and approved by UPRC ( "Crossing Plan Set ").
Notwithstanding the foregoing or anything herein to the contrary, the Company
shall construct the Rail Crossing Infrastructure at its sole discretion. Should the
Company elect, in its sole discretion, to not construct the Rail Crossing
Infrastructure, the Corporation shall have no further obligation to pay such amount
to the Company.
(c) Complete the Infrastructure Improvements on or before May 7, 2033.
2. Payment of Legal . Each Party shall bear its own legal fees in connection with
the negotiation of this Agreement. The Company commits to reimburse the Corporation for the
necessary legal fees in the preparation of any amendments to this Agreement, if and when such
amendment is required by the Company. Timely payment shall be made within sixty (60) days of
submittal of invoice to the Company by the Corporation or its assigns.
3. Jobs Created. The Company's capital investment will result in the initial creation
of a minimum Zero (0) jobs at business enterprises operating within the SA ETJ Land on or before
May 7, 2033.
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4. Capital Investment. A minimum capital investment ofNINE MILLION DOLLARS
and NO /100 ($9,000,000.00), on or before May 7, 2033, in the form of the development and
construction of any Facility or Facilities, the totality of which satisfies the aforementioned capital
investment requirement, (commenced as of the Effective Date herein evidenced by issued building
permit for the Facility or Facilities, as the case may be) by Company, its affiliates, successors or
assigns, upon the SA ETJ Land and verified through the receipt of a signed Certificate of
Occupancy for said Facility or Facilities confirming that the entire work covered by the building
permit and plans are in place for said Facility or Facilities, issued by the City of Schertz Inspections
Division before the Expiration Date of the Agreement.
ARTICLE VI
COVENANTS AND DUTIES
1. The Company's Covenants and Duties. The Company makes the following
covenants and warranties to the Corporation, and agrees to timely and fully perform the obligations
and duties contained in Article V of this Agreement. Any false or substantially misleading
statements contained herein or failure to timely and fully perform those obligations and duties
within this Agreement shall be an act of Default by the Company.
(a) The Company is authorized to do business and is in good standing in the
State of Texas and shall remain in good standing in the State of Texas during any
term of this Agreement.
(b) The execution of this Agreement has been duly authorized by the
Company's authorized agent, and the individual signing this Agreement is
empowered to execute such Agreement and bind the Company. Said authorization,
signing, and binding effect is not in contravention of any law, rule, regulation, or
of the provisions of the Company's operating agreement, or of any agreement or
instrument to which the Company is a party to or by which it may be bound.
(c) The Company is not a party to any Bankruptcy proceedings currently
pending or contemplated, and the Company has not been informed of any potential
involuntary Bankruptcy proceedings.
(d) To its current, actual knowledge, the Company has acquired and maintained
all necessary rights, licenses, permits, and authority to carry on its business in the
City and will continue to use its best efforts to maintain all necessary rights,
licenses, permits, and authority.
(e) The Company agrees to obtain or cause to be obtained, all necessary permits
and approvals from City and /or all other governmental agencies or private
authorities having jurisdiction over the construction of the Infrastructure
Improvements.
(f) The Company shall be responsible for paying, or causing to be paid, to the
City and all other governmental agencies or private. authorities the cost of all
applicable permit fees and licenses required for construction of the Infrastructure
Improvements. The Company agrees to construct the Road Infrastructure in
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accordance with the ordinances, rules, and regulations of the City in effect on the
date the Road Plan Set is approved by the City. The Company, in its sole discretion,
may choose to comply with any or all City rules promulgated after the Effective
Date of this Agreement.
(g) The Company agrees to commence and complete the Project in strict
accordance with this Agreement.
(h) The Company shall cooperate with the Corporation in providing all
necessary information to assist them in complying with this Agreement.
(i) During the term of this Agreement, Company agrees to not knowingly
employ any undocumented workers as part of the Project, and, if convicted of a
violation under 8 U.S.C. Section 1324a (1), Company shall be in Default (subject
to the remedies in Article V above). Company is not liable for an unknown violation
of this Section by a subsidiary, affiliate, or franchisee of Company or by a person
with whom Company contracts provided however that identical federal law
requirements provided for herein shall be included as part of any agreement or
contract which Company enters into with any subsidiary, assignee, affiliate, or
franchisee for which the Infrastructure Grant provided herein will be used.
0) Company shall not be in arrears and shall be current in the payment of all
taxes and fees as to the SA ETJ Land.
(k) Company acknowledges that no other economic development incentives,
except a sales tax incentive, if applicable, will be given to a subsequent successor
or assign of the SA ETJ Land and will market the SA ETJ Land accordingly.
2. Corporation's Covenants and Duties.
(a) The Corporation is obligated to pay the Company an Infrastructure Grant in
the amount up to TWO MILLION FIVE HUNDRED THOUSAND DOLLARS
and NO /100 ($2,500,000.00). The Infrastructure Grant shall be paid in accordance
with Article IV, Section 1 within thirty (30) days after receiving written notice from
the Company.
(b) The Corporation represents and warrants to the Company that this
Agreement is within their authority, and that they are duly authorized and
empowered to enter into this Agreement, unless otherwise ordered by a court of
competent jurisdiction.
(c) The Corporation shall cooperate with the Company in providing all
necessary information and documentation to assist them in complying with this
Agreement.
(d) Corporation shall assist the Company, where applicable, in securing other
applicable incentives from Comal County or the State of Texas in connection with
any end user of any facility constructed within the SA ETJ Land.
(e) Corporation shall assist the Company, where applicable, in securing
applicable Sales Tax Incentives from the Corporation, the City of Schertz, and
Comal County in connection with the end user of any facility constructed within
the SA ETJ Land.
3. Compliance and Default. Failure by the Company to timely comply with any
performance requirement, duty, or covenant shall be considered an act of Default and shall give
the Corporation the right to terminate this Agreement and collect the Recapture Amount (as
defined below), if applicable.
ARTICLE VII
TERNUNATION
1. Termination. This Agreement shall terminate upon the earliest occurrence of any
one or more of the following:
(a) The written agreement of the Parties, or their affiliates, successors or
assigns;
(b) The Company, its affiliates, successors or assigns satisfying the
performance obligations set forth in Article V;
(c) The Agreement's Expiration Date; or
(d) Default by the Company of the terms and conditions set forth herein.
ARTICLE VIII
DEFAULT
1. The Company's Events of Default. The following shall be considered an Event of
Default by the Company:
(a) Failure of the Company to perform any term, covenant or agreement
contained in this Agreement;
(b) The Corporation determines that any representation or warranty contained
herein or in any financial statement, certificate, report or opinion prepared and
submitted to Corporation in connection with or pursuant to the requirements of this
Agreement was incorrect or misleading in any material respect when made;
(c) Any judgment is assessed against the Company or any attachment or other
levy against the property of the Company with respect to a claim remains unpaid,
unstayed on appeal, not discharged, not bonded or not dismissed for a period of
ninety (90) days;
(d) The Company makes an assignment for the benefit of creditors; files a
petition in bankruptcy; is adjudicated insolvent or bankrupt; petitions or applies to
any tribunal for any receiver or any trustee of the Company or any substantial part
of the SA ETJ Land; commences any action relating to the Company under 'any,
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reorganization, arrangement, readjustment of debt, dissolution or liquidation law or
statute of any jurisdiction whether now or hereafter in effect; or if there is
commenced against the Company any such action and such action remains
undismissed or unanswered for a period of ninety (90) days from such filing; or
(e) The Company changes its present ownership more than fifty -one (51 %)
without written notification to the Corporation within thirty (30) days of such
change.
2. Corporation Events of Default. The Corporation fails to fulfill an obligation set
forth within the terms and conditions of this Agreement.
Remedies for Default
(a) The Company's sole remedy under this Agreement is specific performance
for Corporation's Default of its obligations under Section IV of this Agreement.
(b) In the event of Default by the Company, the Corporation shall provide the
Company written notice of Default, and a minimum period of ninety (90) days
after the receipt of said notice to cure such default. If the Company fails to cure
such default or fails to take significant action to cure such default, the Corporation
shall, as its sole and exclusive remedy for Default hereunder, have the right to
terminate this Agreement, and (i) not make the Infrastructure Grant payment(s) if
distribution in accordance with Article N, Section 1 has not yet occurred, or (ii)
recapture one hundred percent (100 %) of the funds actually distributed from the
Infrastructure Grant to Company if payment(s) under Article IV, Section 1 has
already been distributed (the "Recapture Amount "). The Recaptured Amount shall
be paid by Company within thirty (30) days after the date Company is notified by
the Corporation of such Default (the "Payment Date "). In the event the Recaptured
Amount is not repaid by the applicable Payment Date, the unpaid portion thereof
shall accrue interest at the rate of three percent (3 %) per annum from the Effective
Date until paid in full.
4. Limitation on Use of Funds in the Event of Default. Under no circumstances will the funds
received under this Agreement be used, either directly or indirectly, to pay costs or attorney fees
incurred in any adversarial proceeding regarding this Agreement against the City or the
Corporation.
ARTICLE IX
MISCELLANEOUS
1. Binding Agreement. The terms and conditions of this Agreement shall be binding
on and inure to the benefit of the Parties, and their respective successors and assigns. The Executive
Director of the Corporation shall be responsible for the administration of this Agreement and shall
have the authority to execute any instruments, duly approved by the Corporation, on behalf of the
Parties related thereto.
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2. Mutual Assistance. The Parties will do all things reasonably necessary or
appropriate to carry out the terms and provisions of this Agreement and to aid and assist each other
in carrying out such terms and provisions.
3. Assignment. The Company shall have the right to assign all or part of its rights,
duties, and obligations under this Agreement to a duly qualified third party with prior written
approval of the Corporation, which approval shall not be unreasonably withheld, conditioned or
delayed. Any assignment provided for herein shall not serve to enlarge or diminish the obligations
and requirements of this Agreement, nor shall they relieve the Company of any liability to, the
Corporation including any required indemnity in the event that any Assignee hereof shall at any
time be in Default of the terms of this Agreement The Corporation may demand and receive
adequate assurance of performance including the deposit or provision of financial security by any
proposed assignee prior to its approval of an assignment.
Independent Contractors.
(a) It is expressly understood and agreed by all Parties hereto that in performing
their services hereunder, Company at no time will be acting as an agent of the Corporation and
that all consultants or contractors engaged by Company respectively will be independent
contractors of Company; and nothing contained in this Agreement is intended by the Parties to
create a partnership or joint venture between the Parties and any implication to the contrary is
hereby expressly disavowed the Parties hereto understand and agree that the Corporation will not
be liable for any claims that may be asserted by any third party occurring in connection with
services performed by Company respectively under this Agreement, unless any such claims are
due to the fault of the Corporation.
(b) By entering into this Agreement, except as specifically set forth herein, the
Parties do not, waive, and shall not be deemed to have waived, any rights, immunities, or defenses
either may have, including the defense of parties, and nothing contained herein shall ever be
construed as a waiver of sovereign or official immunity by the Corporation with such rights being
expressly reserved to the fullest extent authorized by law and to the same extent which existed
prior to the execution hereof.
(c) No employee of the Corporation, or any board member, or agent of the
Corporation, shall be personally responsible for any liability arising under or growing out of this
Agreement.
5. Notice. Any notice required or permitted to be delivered hereunder shall be deemed
delivered by actual delivery, or on the first business day after depositing the same in the hands of
a reputable overnight courier (such as United States Postal Service, FedEx or UPS) and addressed
to the Party at the address set forth below:
If intended for SEDC: City of Schertz Economic Development Corporation
Attention: Exec. Dir. of Economic Development
1400 Schertz Parkway
Schertz, TX 78154
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With a copy to:
Denton, Navarro, Rocha, Bernal, & Zech, PC
Attention: Charles E. Zech
2517 North Main Avenue
San Antonio, TX 78212
If to Company; Schertz 312, LLC
Attention: Kevin L. Reid
9601 McAllister Fwy., Suite 1120
San Antonio, TX 78216
With a copy to:
Titan Development
Attn: Christopher M. Pacheco
6300 Riverside Plaza Ln. NW, Suite 200
Albuquerque, NM 87120
Any Party may designate a different address at any time upon written notice to the other
Parties:
6. Governmental Records. All invoices, records and other documents required for
submission to the City pursuant to the terms of this Agreement are Governmental Records for the
purposes of Texas Penal Code Section 37.10.
7. Governing Law. The Agreement shall be governed by the laws of the State of
Texas, and the venue for any action concerning this Agreement shall be in the Courts of Guadalupe
County. The Parties agree to submit to the personal and subject matter jurisdiction of said court.
8. Amendment. This Agreement may be amended by mutual written agreement of the
Parties, as approved by the Board of Directors of the Corporation.
9. Legal Construction. In the event any one or more of the provisions contained in
this Agreement shall, for any reason, be held invalid, illegal, or unenforceable in any respect, such
invalidity, illegality, or unenforceability shall not affect other provisions of this Agreement, and it
is the intention of the Parties to this Agreement that, in lieu of each provision that is found to be
illegal, invalid, or unenforceable, a provision be added to this Agreement which is legal, valid and
enforceable and is as similar in terms as possible to the provision found to be illegal, invalid, or
unenforceable.
10. Interpretation. Each of the Parties has been represented by counsel of their
choosing in the negotiation and preparation of this Agreement. Regardless of which Parry prepared
the initial draft of this Agreement, this Agreement shall, in the event of any dispute, whatever its
meaning or application, be interpreted fairly and reasonably and neither more strongly for or
against any Parry.
11. Entire Agreement. This Agreement constitutes the entire agreement between the
Parties with respect to the subject matter covered in this Agreement. There is no other collateral
oral or written agreement between the Parties that, in any manner, relates to the subject matter of
12
this Agreement, except as provided for in any Exhibits attached hereto or duly approved
amendments to this Agreement, as approved by the Board of Directors of the Corporation.
12. Paragraph Headings. The paragraph headings contained in this Agreement are for
convenience only and will in no way enlarge or limit the scope or meaning of the various and
several paragraphs.
13. Counterparts. This Agreement may be executed in counterparts. Each of the
counterparts shall be deemed an original instrument, but all of the counterparts shall constitute one
and the same instrument.
14. Exhibits. Any exhibits attached hereto are incorporated by reference for all
purposes.
15. Survival of Covenants. Any of the representations, warranties, covenants, and
obligations of the Parties, as well as any rights and benefits of the Parties, pertaining to a period
of time following the termination of this Agreement shall survive termination.
16. Indemnification. COMPANY AGREES TO DEFEND, INDEMNIFY AND
HOLD THE CORPORATION AND THE CITY, AND THEIR RESPECTIVE OFFICERS,
AGENTS AND EMPLOYEES HARMLESS FROM AND AGAINST ANY AND ALL
REASONABLE LIABILITIES, DAMAGES, CLAIMS, LAWSUITS, JUDGEMENTS,
ATTORNEY FEES, COSTS, EXPENSES AND ANY CAUSE OF ACTION THAT
DIRECTLY RELATES TO ANY OF THE FOLLOWING: ANY CLAIMS OR DEMANDS
BY THE STATE OF TEXAS THAT THE CORPORATION HAS BEEN ERRONEOUSLY
OR OVER -PAID SALES AND USE TAX FOR ANY PERIOD DURING THE TERM OF
THIS AGREEMENT AS A RESULT OF THE FAILURE OF COMPANY TO MAINTAIN
A PLACE OF BUSINESS AT THE PROPERTY OR IN THE CITY OF SCHERTZ, OR AS
A RESULT OF ANY ACT OR OMISSION OR BREACH OR NON - PERFORMANCE BY
COMPANY UNDER THIS AGREEMENT EXCEPT THAT THE IMDEMNITY
PROVIDED HEREIN SHALL NOT APPLY TO ANY LIABILITY RESULTING FROM
THE ACTION OR OMISSIONS OF THE CORPORATION OR CITY. THE
PROVISIONS OF THIS SECTION ARE SOLELY FOR THE BENEFIT OF THE
PARTIES HERETO AND NOT INTENDED TO CREATE OR GRANT ANY RIGHTS,
CONTRACTUAL OR OTHERWISE, TO ANY OTHER PERSON OR ENTITY. IT
BEING THE INTENTION OF THE PARTIES THAT COMPANY SHALL BE
RESPONSIBLE FOR THE REPAYMENT OF ANY FUNDS PAID TO COMPANY
HEREIN THAT INCLUDES CITY SALES TAX RECEIPTS THAT THE STATE OF
TEXAS HAS DETERMINED WAS ERRONEOUSLY PAID, DISTRIBUTED OR
ALLOCATED TO THE CORPORATION.
17. Additional Instruments. The Parties agree and covenant to cooperate, negotiate in
good faith, and to execute such other and further instruments and documents as may be reasonably
required to fulfill the public purposes provided for and included within this Agreement.
18. Force Maieure. Whenever a period of time is herein prescribed for action to be
taken by Company, Company shall not be liable or responsible for, and there shall be excluded
13
from the computation of any such period of time, any delays due to causes of any kind whatsoever
which are caused by Force Majeure.
19. Time Periods. Unless otherwise expressly provided herein, all periods for delivery
or review and the like will be determined on a "calendar" day basis. If any date for performance,
approval, delivery or Closing falls on a Saturday, Sunday or legal holiday (state or federal) in the
State of Texas, the time therefor will be extended to the next day which is not a Saturday, Sunday
or legal holiday.
[SIGNATURE PAGE IMMEDIATELY FOLLOWING]
14
Executed on this day of , 2019.
COMPANY:
SCHERTZ 312, LLC
a Texas limited liability company
By: Schertz 312 Management, LLC
Its Manager
By: Titan Lone Star, LLC
Its Manager
C
STATE OF TEXAS
COUNTY OF BEXAR
Kevin L. Reid, Manager
This information was acknowledged before me on this day of ,
2019 by Kevin L. Reid, as Manager of Titan Lone Star, LLC, as manager of Schertz 312
Management, LLC, as manager of Schertz 312, LLC, a Texas limited liability company, on behalf
of said company.
Notary Public, State of Texas
Notary's typed or printed name
My commission expires
15
Executed on this day of , 2019.
CITY OF SCHERTZ ECONOMIC
DEVELOPMENT CORPORATION
By:
Name: Paul Macaluso
Title: President
STATE OF TEXAS X
COUNTY OF GUADALUPE X
This information was acknowledged before me on this day of ,
2019 by Paul Macaluso, as President of the City of Schertz Economic Development Corporation,
a Texas non - profit industrial development corporation, on behalf of said agency.
APPROVED AS TO FORM:
itz
j-),iTorney
16
Notary Public, State of Texas
Notary's typed or printed name
My commission expires
EXHIBIT "A"
REAL ESTATE LEGAL DESCRIPTION
(See Attached)
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DEPICTION OR SCHERTZ LAND, SA ETJ LAND
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18
EXHIBIT "B"
INFRASTRUCTURE IMPROVEMENTS
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