20-R-114 - Economic Development Performance Agreement between the City of Schertz EDC and Kellum Real Estate, LLC.RESOLUTION NO. 20-R-114
A RESOLUTION BY THE CITY COUNCIL OF THE CITY OF SCHERTZ,
TEXAS AUTHORIZING AN ECONOMIC DEVELOPMENT
PERFORMANCE AGREEMENT BETWEEN THE CITY OF SCHERTZ
ECONOMIC DEVELOPMENT CORPORATION AND KELLUM REAL
ESTATE, LLC.; AND OTHER MATTERS IN CONNECTION
THEREWITH
WHEREAS, the City of Schertz Economic Development Corporation ( "SEDC ") is a non-
profit industrial development corporation duly established under 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 ");
WHEREAS, all of the powers of the corporation are vested in the SEDC Board of
Directors (the "Board ") appointed by the governing body of the corporation's authorizing unit;
and
WHEREAS, the Act authorizes a development corporation to fund certain projects as
defined by the Act and request 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 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, Kellum Real Estate, LLC (the "Company ") desires to make a capital
investment in excess of 11.5 million dollars to construct a medical center and medical office
complex consisting of three facilities projected to create or expand employment by over 220 jobs
with an associated increase in local payroll of approximately 11 million dollars by February of
2031 in Schertz, Texas; and
WHEREAS, the SEDC desires to offer an incentive to enable the Company to locate and
expand its investment pursuant to the proposed Economic Development Performance Agreement
in substantial conformity with the Schertz Incentive Policy and the Act; and
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WHEREAS, Section 505.159 of the Act requires that a corporation hold at least one public
hearing on the proposed project before spending money to undertake the project and the public
hearing was held on September 24, 2020; and
WHEREAS, following the public hearing, the Board approved the Economic
Development Performance Agreement for the Company as set forth in Exhibit A attached hereto
and incorporated herein (the "Agreement ") between the SEDC and the Company, pursuant to the
Act; and,
WHEREAS, Said Agreement and shall be effective upon approval by the Schertz City
Council as required by Section 501.073 of the Act requiring approval of all programs and
expenditures by the authorizing unit; and
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF SCHERTZ, TEXAS THAT:
Section 1. The Schertz City Council hereby approves the Economic Development
Performance Agreement attached hereto as Exhibit A and authorizes the SEDC President to
execute and deliver in the substantial form as attached.
Section 2. The Schertz Council approves a Resolution authorizing the expenditures
contemplated herein for the reasons stated in the foregoing recitals.
Section 3. 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 Schertz City Council.
Section 4. 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 5. This Resolution shall be construed and enforced in accordance with the laws
of the State of Texas and the United States of America.
Section 6. 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 7. 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 8. This Resolution shall be in force and effect from and after its final passage,
and it is so resolved.
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PASSED AND ADOPTED, this 271 day of October, 2020.
ATTEST:
j
Brenda Dennis, City Secretary
(_C'
CIT OF SCHERTZ, TEXAS
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Exhibit A
ECONOMIC DEVELOPMENT PERFORMANCE AGREEMENT
KELLUM REAL ESTATE, LLC.,
[SEE ATTACHED]
ECONOMIC DEVELOPMENT PERFORMANCE AGREEMENT
KELLUM REAL ESTATE, LLC
This Performance Agreement ( "Agreement") is entered into to be effective 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 "SEDC ") created by, and for the benefit of the City of Schertz, Texas (hereinafter the called
the "City") Kellum Real Estate, LLC., a Texas Limited Liability Company, its associated entities,
successors or assigns (hereinafter called "Company "), the SEDC 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 has purchased the Schertz Medical Center Land (as defined
below), as more precisely described on Exhibit A (attached hereto and incorporated herein); and
WHEREAS, the SEDC adopted the Schertz Incentive Policy in May 2017 to guide and
ensure consistency when providing incentives within the City of Schertz to promote economic
development; and
WHEREAS, the SEDC desires to offer an Infrastructure Grant to the Company to enable
the development the Schertz Medical Center Land pursuant to this Agreement in substantial
conformity with the Schertz Incentive Policy and the Act; and
WHEREAS, the location of the Schertz Medical Center Land and the Facilities, as
proposed, will contribute to the economic development of the City by creating new jobs and
increased employment, promoting and developing expanded business enterprises, increased
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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; 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
1. Recitals. The recitals set forth above are declared true and correct by the Parties
and are hereby incorporated as part of this Agreement.
ARTICLE II
AUTHORITY AND TERM
1. A_ uthorit,, . The SEDC's execution of this Agreement is authorized by the Act and
constitutes a valid and binding obligation of the SEDC. The SEDC acknowledges that the
Company is acting in reliance upon the SEDC'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, 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 SEDC for the granting of funds to cover certain costs associated with the
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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 SEDC 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 Acreement. Upon the Effective Date, the SEDC delegates the
administration and oversight of this Agreement to the Executive Director of the SEDC. Any
proposed amendments to the Agreement shall require the approval of the Board of Directors of the
SEDC.
ARTICLE III
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
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
Inspections Division confirming that the entire work covered by the permit and plans are in place.
The Certificate of Occupancy shall be used to document the Company's Capital Investment.
"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.
"Effective Date" shall be the date of the last signing by a party to the agreement.
"Expiration Date" shall mean the earlier of
1. 10 years from the Effective Date; or
2. The date of termination, provided for under Article VII of this Agreement.
"Facilities" shall mean the three proposed office buildings described in elevations
submitted to the City of Schertz as of September 15, 2020 constructed on the Schertz Medical
Center Land wherein Company intends to attract and expand office opportunities and jobs.
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"Force Majeure" shall mean any contingency or cause beyond the reasonable control of a
Party, 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 those items set forth in Article V Section 1.
"Letter of Acceptance" shall mean a signed letter issued by the City of Schertz accepting
the Infrastructure Improvements.
"New Jobs" shall mean jobs that are created as a result of the construction of the Facilities
and shall exclude any job relocated from any other location of Company within the City of Schertz.
"Project" shall mean the construction of the Infrastructure Improvements.
"Project Costs" shall mean the actual construction costs incurred by Company for the
completion of the Infrastructure Improvements, and shall specifically include the sewer line impact
fee, sewer line extension and connections, water main re- locate, and road infrastructure and
exclude any management fee for Company or its developer and tree mitigation fee.
" Schertz Medical Center Land" shall mean the approximately 5.403 acres located within
the City of Schertz, Texas as approximately shown on Exhibit A.
"State of Texas" shall mean the Office of the Texas Comptroller, or its successor.
ARTICLE IV
SEDC 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 V hereof, the SEDC shall pay the Company, for the actual construction costs of the
Infrastructure Improvements, an amount not to exceed THREE HUNDRED FIFTY THOUSAND
DOLLARS and NO /100 ($350,000.00) (the "Infrastructure Grant ").
2. Current Revenue. The Infrastructure Grant shall be paid solely from lawfully
available funds of the SEDC. Under no circumstances shall the obligations hereunder be deemed
to create any debt within the meaning of any constitutional or statutory provision. The SEDC
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 SEDC's current and future funds that would render
the SEDC 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.
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3. Confidentialit_.. The SEDC 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, SEDC 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 SEDC 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.
1. Infrastructure Imjlroyements. The Company will construct the following
Infrastructure Improvements upon the Schertz Medical Center Land, as depicted on Exhibit B:
(a) Construct and pay all sewer line extensions, connections and impact fees
associated with the approximate development depicted in Exhibit B.
(b) Construct and pay all water line extensions, relocation, and impact fees
associated with the approximate development depicted in Exhibit B.
(e) Construct all roadway infrastructure associated with the approximate
development depicted in Exhibit B.
(f) All improvements must be constructed to the City specifications as
identified in the City of Schertz Public Works Design Specifications as evidenced
by a Letter of Acceptance issued by the City of Schertz.
(g) Allow access by the SEDC to all construction documents related to the
Infrastructure Improvements during the term of the Agreement.
(h) Commence within ninety (90) days from the Effective Date and complete
Infrastructure Improvements within three- hundred sixty -five (365) days from the
Effective Date.
2. Facilit;, Size and Capital Investment. The Company shall construct the Facilities on
the Schertz Medical Center Land. with the following size and minimum capital investment which
shall be verified by the Company through the receipt of the Certificate of Occupancy;
(a) Facility One shall be at least TWENTY -THREE THOUSAND (23,000)
square feet and have a minimum capital investment of FIVE MILLION NINE
HUNDRED NINETY -FIVE THOUSAND EIGHT HUNDRED NINETY -NINE
DOLLARS AND N01100 ($5,995,899.00)
(b) Facility Two shall be at least FOUR THOUSAND (4,000) square feet and
have a minimum capital investment of ONE MILLION FIVE HUNDRED
THOUSAND DOLLARS AND NO /100 ($1,500,000.00)
(c) Facility Three shall be at least TWELVE THOUSAND (12,000) square feet
and have a minimum capital investment of THREE MILLION FIVE HUNDRED
THOUSAND DOLLARS AND NO /100 ($3,500,000.00)
3. New Job and Annual Pa. roll Creation. The Company's capital investment will
result in the creation of New Jobs and Annual Payroll within the Schertz Medical Center Land
which will be reported through conditions imposed by lease agreements and as reported to the
Texas Workforce Commission for each year according to the following schedule:
Performance
Year
New Jobs
Total Jobs
Payroll
Annual Report
2021
50
50
$ 2,200,000.00
February 15, 2022
2022
30
80
$ 3,500,000.00
February 15, 2023
2023
10
90
$ 4,800,000.00
February 15, 2024
2024
30
120
$ 5,300,000.00
February 15, 2025
2025
25
145
$ 6,600,000.00
February 15, 2026
2026
25
170
$ 7,700,000.00
February 15, 2027
2027
15
185
$ 8,800,000.00
February 15, 2028
2028
15
200
$ 9,400,000.00
February 15, 2029
2029
15
215
$10,560,000.00
February 15, 2030
2030
_
10
225
$11,000,000.00
February 15, 2031
4. Annual Report. The Company shall submit an Annual Report for the preceding
Calendar Year to the Executive Director of the SEDC each year not later than February 15a', The
Annual Report should substantially conform to the Annual Report Form attached as Exhibit C to
this Agreement. The first Annual Report will be due February 15`h, 2021.
5. Pat _vent of Legal Fees. Each Party shall bear its own legal fees in connection with
the negotiation of this Agreement. The Company commits to reimburse the SEDC for the
necessary legal fees in the preparation of any amendment to this Agreement, if and when such
amendment is requested by the Company. Timely payment shall be made within sixty (60) days
of submittal of invoice to the Company by the SEDC or its assigns.
ARTICLE VI
COVENANTS AND DUTIES
1. The Company Covenants an_d Duties. The Company makes the following covenants
and warranties to the SEDC and agrees to timely and fully perform the obligations and duties
contained in Article V of this Agreement. Any false or substantially misleading statements
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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 entity. 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 having jurisdiction
over the construction of Infrastructure Improvements and Facilities within the
Schertz Medical Center Land.
(f) The Company shall be responsible for paying, or causing to be paid, to the
City and all other governmental agencies the cost of all applicable permit fees and
licenses required for construction of the Project. The Company agrees to develop
the Project in accordance with the ordinances, rules, and regulations of the City in
effect on the date the Project was designed, unless specified otherwise in this
Agreement. 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 SEDC in providing all necessary
information to assist them in complying with this Agreement. Cooperation shall
include, but not be limited to, providing evidence and copies of construction
contracts, payments for construction, permits, construction supply purchases, and
any other documentation deemed necessary by SEDC to substantiate the reported
Project Costs.
(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
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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 Operations Grant and Annual Grant provided herein will
be used.
0) Company shall not be in arrears and shall be current in the payment of all
City taxes and fees as to the Schertz Medical Center Land.
2. SEDC's Covenants and Duties.
(a) Infrastructure Grant. The SEDC is obligated to pay the Company an
Infrastructure Grant in the amount of up to THREE HUNDRED FIFTY
THOUSAND DOLLARS AND N011 00 ($350,000.00) in accordance with Article
IV, Section 1 within forty-five (45) days after the Company provides the SEDC
written notice and sufficient documentation evidencing:
i. the completion of construction of the Infrastructure Improvements in
accordance with Article V, Section 1;
ii. issuance of certificates of occupancy for Facility One and Facility Two per
Article V, Section 2;
1. for purposes of compliance with Article V, Section 2, copies of
Certificates of Occupancy issued by the City of Schertz indicating
the valuation and square footage of the completed facilities shall
constitute sufficient documentation.
iii. if applicable, compliance with the New Job and Annual Payroll Creation
requirements of Article V, Section 3.
(b) The SEDC 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) SEDC shall cooperate with the Company in providing all necessary
information and documentation to assist them in complying with this Agreement.
3. Comb sliance 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 SEDC the right to terminate this Agreement and collect the Recapture Amount (as defined
below), as determined by the Board of Directors of the SEDC.
ARTICLE VII
TERMINATION
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;
(b) The Company satisfying all of the Performance and Obligations set forth
in Article V, (1) and (2);
(c) The Agreement's Expiration Date;
(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; or
(b) SEDC determines that any representation or warranty contained herein or
in any financial statement, certificate, report or opinion prepared and submitted to
SEDC in connection with or pursuant to the requirements of this Agreement was
incorrect or misleading in any material respect when made; or
(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; or
(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 Schertz Medical Center Land; commences any action relating to the
Company under any 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;
(e) The Company changes its present ownership more than fifty -one (51%)
without written notification to SEDC within thirty (30) days of such change; or
2. SEDC Events of Default. SEDC fails to fulfill an obligation set forth within the
terms and conditions of this Agreement.
3. Remedies for Default
(a) The Company's sole remedy under this Agreement is specific performance
for SEDC's Default of its obligations under section IV of this Agreement.
(b) In the event of Default by the Company, the SEDC 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
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such default or fails to take significant action to cure such default, the SEDC shall,
as its sole and exclusive remedy for Default hereunder, have the right to terminate
this Agreement and recapture one hundred percent (100 %) of the funds distributed
from the Infrastructure Grant to Company plus interest at the rate of five percent
(5 %) per annum from the Effective Date until paid in full if the Default occurs on
or prior to the Expiration Date (the "Recapture Amount "). The Recaptured Amount
shall be paid by Company within thirty (30) days after the date Company is notified
by the SEDC of such Default (the "Payment Date ").
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 SEDC.
ARTICLE IX
MISCELLANEOUS
I . Bindin 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 SEDC shall be responsible for the administration of this Agreement and shall have
the authority to execute any instruments, duly approved by the SEDC, on behalf of the Parties
related thereto.
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 of its rights, duties,
and obligations under this Agreement to a duly qualified third party with prior written approval of
the SEDC, 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 SEDC
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 SEDC 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.
4. 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 SEDC 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 SEDC 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
SEDC.
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(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 SEDC 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 SEDC, or any board member, or agent of the SEDC,
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
With a copy to:
Denton, Navarro, Rocha, Bernal, & Zech, PC
Attention: T.Daniel Santee
2517 North Main Avenue
San Antonio, TX 78212
If to Com;_ an:_ Kellum Real Estate, LLC
Attention: Daniel Kellum
3401 Roy Richard Drive
Schertz, TX 78154
With a copy to:
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 SEDC.
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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. Inteil)retation. Each of the Parties has been represented by counsel of their
choosing in the negotiation and preparation of this Agreement. Regardless of which Party 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 Party.
11. Entire k_sreement. 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
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 SEDC.
12. Paraga h Headiness. 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. Countei -,arts. 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 SEDC 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 SEDC 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 SEDC 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
12
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 SEDC.
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 Majeure. 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
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]
13
Executed on this day of ,))rf _ , 20+
COMPANY:
Kellum Real Estate, LLC.
A Texas Corporation
By: Kellum Real Estate, LLC
By: _
e,
Title,
STATE OF TEXAS X
COUNTY OF�,��X
This information was acknowledged before me on this day of y ,4
2020 by A =as Manager of Kellum Real Estate, LLC., on behalf of said
company.
.►�`'�° Pvcncty Paxton Notary Public, Sta ` Texas
My ComtnrWan Evlrea
x . % 01 25x2022
i•,) NO. 126tpt288
Notary's typed or printed name
My commssi n expires
14
Executed on this day of , 20_
CITY OF SCHERTZ ECONOMIC
DEVELOPMENT CORPORATION
By: _
Name: Paul Macaluso
Title: Board President
STATE OF TEXAS X
COUNTY OF GUADALUPE X
This information was acknowledged before me on this day of ,
by , for the City of Schertz Economic Development Corporation, a Texas
non -profit industrial development corporation, on behalf of said agency.
APPROVED AS To FORM:
C
, SEDC Attorney
15
Notary Public, State of Texas
Notary's typed or printed name
My commission expires
EXHIBIT A
SCHERTZ FAMILY MEDICAL CENTER LAND LEGAL DESCRIPTION
Lot 3, Block 1, Cal Stone Subdivision Replat, Guadalupe County, Texas.
Lot 4, Block 1, Cal Stone Subdivision Replat, Guadalupe County, Texas.
16
EXHIBIT B
SCHERTZ FAMILY MEDICAL CENTER LAND
INFRASTRUCTURE IMPROVEMENTS
Sewer line impact fee City of Schertz $172,777.18
Sewer line extension and connections $128,222.11
Water main re-location $161,069.55
Road Infrastructure/safety work $211,907.48
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ANNUAL REPORT
18
Annual Certification Report
Reporting Period: January 1 to December 31, 20_
The Annual Certification Report for the Economic Development Performance Agreement between the City of Schertz
Economic Development Corporation and Kellum Real Estate, LLC., is due on February 15, 20_. Please sign and
return the Annual Certification Report form with accompanying narrative.
Project Information:
Company's legal name:
Project address subject to incentive:
Company primary contact:
Phone number:
E -mail address:
Title:
Employment and Wage Information:
Has the Company employed undocumented workers? ❑ Yes ❑ No
What is the total number of New Jobs created at the Schertz Medical Center during the calendar year?
What is the total Annual Payroll for the Schertz Medical Center during the calendar year?
Narrative:
Please attach a brief narrative explaining the current year's activities and /or comments relating to any potential defaults.
Employment:
Total part -time employees:
Total annual payroll:
Number of employees that live in Schertz, Texas:
Interested in being contacted about workforce training opportunities? ❑ Yes ❑ No
Interested in being contacted for assistance with City permits? ❑ Yes ❑ No
19
I certify that, to the best of my knowledge and belief, the information and attachments provided herein are true and accurate
and in compliance with the terms of Economic Development Performance Agreement.
I further certify that the representations and warranties contained within the Agreement remain true and correct as of the
date of this Certification, and Kellum Real Estate, LLC. remakes those representations and warranties as of the date hereof.
i
I further certify that the employment and wage information provided is true and accurate to the best of my knowledge and I
can provide documentation from the Texas Workforce Commission to support my claim if so requested.
I understand that this Certificate is being relied upon by the SEDC in connection with the expenditure of public funds.
I have the legal and express authority to sign this Certificate on behalf of Kellum Real Estate, LLC.
Name of Certifying Officer Certifying Officer's Title
Phone Number
E -Mail Address
Signature of Certifying Officer Date
STATE OF TEXAS X
COUNTY OF X
This information was acknowledged before me on this day of by
for Kellum Real Estate, LLC, a Texas Limited Liability Company, on behalf of said entity.
Notary Public, State of Texas
Notary's typed or printed name
My commission expires
The Annual Certification Report is to be completed, signed and returned on or before February 15, 20_. Please
send an original to the following address:
Attention: Executive Director
City of Schertz Economic Development Corporation
1400 Schertz Parkway, Bldg. No. 2
Schertz, TX 78154
dc