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07-27-2023 Agenda SEDC Reg Board Meeting with Packet - CancelledNOTICE OF MEETING AGENDA JULY 27, 2023 The City of Schertz Economic Development Corporation (SEDC) Board of Directors will hold a regular monthly meeting on Thursday, JULY 27, 2023. at 6:00 p.m. at the Hal Baldwin Municipal Complex, Council Chambers Conference Room, Building No. 4, 1400 Schertz Parkway, Schertz, Texas. This is an open meeting, subject to the open meeting laws of the State of Texas. Call To Order 1.Roll call, recognition of visitors, and review of meeting instructions for effective Board interaction and public participation. Hearing of Residents 2.This time is set aside for any person who wishes to address the Board. Presentations should be limited to no more than 3 minutes.The presiding officer will call on those persons who have signed up to speak. Minutes 3.Approval of the minutes for the Board of Directors Regular Monthly Meetings held on Thursday, June 29, 2023. (T. Miller/S. Wayman) Presentations 4.Staff briefing on SEDC monthly financial statement for the month of June, 2023. (J. Walters/S. Wayman) Discussion Items 5.Resolution 2023-6 - Discussion and possible action on authorizing the funding for I-35 NEX Project: Schertz Parkway Bridge Signage; and other matters in connection. Closed Session 6.Called in accordance with Section 551.087 of the Texas Government Code, Deliberation Regarding Economic Development Negotiations; Closed Meeting. The governmental body is not required to conduct an open meeting (1) to discuss or deliberate regarding commercial or financial information that the governmental body has received from a business prospect that the governmental body seeks to have locate, stay, or expand in or near the territory of the governmental body and with which the governmental body is conducting economic development negotiations; or (2) the deliberate the offer of a financial or other incentive to a business prospect. E-038 E-051 E-80 E-84 E-81 SEDC Agenda July 27, 2023 Page 1 of 2 Reconvene to regular session 7.Take any actions based on discussion held in closed session under Agenda Item No. 6 8.Resolution 2023-7 - Discussion and action on authorizing the amendment to the Performance Agreement Schertz 312, Titan, Schertz 35 Business Park, located on Tejas Dr. south of Doerr Ln. 9.Resolution 2023-8 - Discussion and action on authorizing the amendment and restatement of the Performance Agreement Schertz 312 Phase II, Titan, Schertz 35 Business Park, located on Tejas Dr. south of Doerr Ln. 10.Discussion and feedback with regards to the Schertz Economic Development Corporation (SEDC) Goals and Mission Statement. (A. Ritchey) Requests and Announcements Announcements by staff: August Board Meeting Introduction to Budget Discussions Annual Volunteer Luau Banquet on Tuesday, August 8, 2023 Lauren Shrum, Parks and Recreation Director, will present August, 2023 Next Board Meeting - August 24, 2023 Requests by Board Members to place items on a future SEDC Board Meeting agenda. Adjournment CERTIFICATION I, Tracy Miller, Administrative Assistant, of the City of Schertz Economic Development Corporation, do hereby certify that the above agenda was posted on the official bulletin boards on this the 21st day of July, 2023, at 4:00 p.m., which is a place readily accessible to the public at all times and that said notice was posted in accordance with chapter 551, Texas Government Code. Tracy Miller Administrative Assistant- Economic Development I certify that the attached notice and agenda of items to be considered by the Schertz Economic Development Corporation Board of Directors was removed from the official bulletin board on _____day of _______________, 2023. Name/Title:______________________________ This facility is accessible in accordance with the Americans with Disabilities Act. Handicapped parking spaces are available. If you require special assistance or have a request for sign interpretative services or other services, please call 210-619-1070. The Economic Development Corporation Board of Directors reserves the right to adjourn into closed session at any time during the course of this meeting to discuss any of the matters listed above, as authorized by the Texas Open Meetings Act. Closed Sessions Authorized: This agenda has been reviewed and approved by the City’s legal counsel and the presence of any subject in any Closed Session portion of the agenda constitutes a written interpretation of Texas Government Code Chapter 551 by legal counsel for the governmental body and constitutes an opinion by the attorney that the items discussed therein may be legally discussed in the closed portion of the meeting considering available opinions of a court of record and opinions of the Texas Attorney General known to the attorney. This provision has been added to this agenda with the intent to meet all elements necessary to satisfy Texas Government Code Chapter 551.144(c) and the meeting is conducted by all participants in reliance on this opinion. SEDC Agenda July 27, 2023 Page 2 of 2 Agenda No. 3. SEDC MEMORANDUM SEDC Board Meeting:07/27/2023 Department:Economic Development Corporation Subject:Approval of the minutes for the Board of Directors Regular Monthly Meetings held on Thursday, June 29, 2023. (T. Miller/S. Wayman) BACKGROUND COMMUNITY BENEFIT FISCAL IMPACT SUMMARY OF RECOMMENDED ACTION Attachments 06-29-23 MINUTES Thursday, June 29, 2023 The City of Schertz Economic Development Corporation (SEDC) Board of Directors met for a Regular Monthly Meeting on Thursday, June 29, 2023. at 6:00 p.m. at the Hal Baldwin Municipal Complex, Council Chambers Conference Room, Building No. 4, 1400 Schertz Parkway, Schertz, Texas. This was an open meeting, subject to the open meeting laws of the State of Texas. Call To Order 1.Roll call, recognition of visitors, and review of meeting instructions for effective Board interaction and public participation. Board President Paul Macaluso presided over the meeting and called it to order at 6:00 p.m. Board of Directors Present:Staff Present: Paul Macaluso, Board President Scott Wayman, Executive Director Sammi Morrill, Board Secretary Ashley Ritchey, Business Engagement Manager Bryan Snowden, Treasurer Tracy Miller, Administrative Assistant Roy Richard, Board Member Brian James, Deputy City Manager Bill Dixon, Board Member John Nowak, Engineer Board of Directors Absent:Others Present: Jesse Hamilton, Vice Present Tim Brown, Mayor Pro-Tem, City Council Liaison Mark Moody, Board Member Hearing of Residents 2.This time is set aside for any person who wishes to address the Board. Presentations should be limited to no more than 3 minutes.The presiding officer will call on those persons who have signed up to speak. No residents were present. Minutes 3.Approval of the minutes for the Board of Directors Regular Monthly Meetings held on Thursday, May 25, 2023. (T.Miller/S.Wayman) Board President Macaluso asked for a motion to approve the Minutes of the Board of Directors Regular Monthly Meeting held on Thursday, May 25, 2023. Moved by Board Member Roy Richard, seconded by Board Member Bill Dixon. AYE: Board President Paul Macaluso, Board Secretary Sammi Morrill, Treasurer Bryan Snowden, Board Member Bill Dixon, Board Member Roy Richard. Presentations 4.Staff briefing on SEDC monthly financial statement for the month of May 2023. (J. Walters/S. Wayman) Mr. Wayman provided an update on the financials for the month. May sales tax received was $587,554, a 7.7% increase over the year prior. The 12-month rolling average is 10.3% still trending up. Notable expenditures include Town Creek Sewer Capacity and TxEDC Patron Investor. Total Cash & Investments figure at the end of May was $29.1 million. Discussion Items 5.Discussion and direction concerning SEDC Res.No.2022-7 and Lookout Rd. design and engineering. (S. Wayman) Mr. Wayman provided the history of SEDC Res. No. 2022-7 authorizing and approving up to $770,000 for the design of the Lookout Road project. Mr. Wayman wanted to affirm the action that was taken by the Board at the September 2022 meeting to approve the design work. The Board approved to go forward the project. Board President Paul Macaluso recessed Open Session to Closed Session at 6:11 p.m. Closed Session 6.Called in accordance with Section 551.087 of the Texas Government Code, Deliberation Regarding Economic Development Negotiations; Closed Meeting. The governmental body is not required to conduct an open meeting (1) to discuss or deliberate regarding commercial or financial information that the governmental body has received from a business prospect that the governmental body seeks to have locate, stay, or expand in or near the territory of the governmental body and with which the governmental body is conducting economic development negotiations; or (2) the deliberate the offer of a financial or other incentive to a business prospect. E-80 E-81 E-84 Start time: 6:12 p.m. End time: 6:38 p.m. Board President Paul Macaluso reconvened to open session at 6:38 p.m. Reconvene to regular session No action was taken based on discussion in closed session. 7.Take any actions based on discussion held in closed session under Agenda Item No.6 No action was taken based on discussion in closed session. Requests and Announcements Announcements by staff: Set date for Board Workshop - No date was set for Board Workshop Ashley Ritchey update on Chicago Mission Trip with Team Texas - Ashley Ritchey gave an update on Team Texas trip. Update on Breakfast Club presentation - Scott Wayman gave an update on the Breakfast Club meeting Offices closed for 4th of July - July 3-4, 2023 Next Board Meeting - July 27, 2023 Requests by Board Members to place items on a future SEDC Board Meeting agenda. No request were made. Adjournment Board President Paul Macaluso adjourned the meeting at 6:43 p.m. MINUTES PASSED AND APPROVED THIS ___ DAY _____ 2023. ____________________ Paul Macaluso Board President ___________________ Sammi Morrill Board Secretary Agenda No. 4. SEDC MEMORANDUM SEDC Board Meeting:07/27/2023 Department:Economic Development Corporation Subject:Staff briefing on SEDC monthly financial statement for the month of June, 2023. (J. Walters/S. Wayman) BACKGROUND COMMUNITY BENEFIT FISCAL IMPACT SUMMARY OF RECOMMENDED ACTION Attachments June Financials 620-SED CORPORATION FINANCIAL SUMMARY OVERVIEW Revenues Sales Tax 567,014.80$ Payment Received in June 17.0% Annual Increase 9.5%12-Month Rolling Average Expenses OnPeak - Conrad Hotel 4,946.18$ Catherine Collier 1,640.00$ RWLV - Conrad Hotel 1,512.80$ Hilton Grand Vacations 1,101.70$ Year-to-Date Total Revenue 5,775,865.90$ Total Expenses 829,366.39$ Over/Under 4,946,499.51$ Cash & Investments Cash 320,818.05$ Investments 29,491,609.05$ Total 29,812,427.10$ C I T Y O F S C H E R T Z *************************************************** 2 0 2 2 - 2 0 2 3 *************************************************** REVENUE AND EXPENSE REPORT (UNAUDITED) AS OF: JUNE 30th, 2023 1 of 7 620-SED CORPORATION CURRENT CURRENT PRIOR YEAR CURRENT Y-T-D BUDGET 75% OF FINANCIAL SUMMARY BUDGET PERIOD Y-T-D ACTUAL Y-T-D ACTUAL ENCUMBR BALANCE BUDGET REVENUE SUMMARY Taxes 6,548,000 574,699.11 4,385,297.32 4,910,727.84 - 1,637,272.16 75.00% Miscellaneous 182,000 116,348.17 72,808.89 865,138.06 - (683,138.06) 475.35% TOTAL REVENUES 6,730,000 691,047.28 4,458,106.21 5,775,865.90 - 954,134.10 85.82% EXPENDITURE SUMMARY NONDEPARTMENTAL City Assistance 3,000,079 - - 81,944.29 - 2,918,134.71 2.73% Fund Charges/Transfer 5,750,000 - - - - 5,750,000.00 0.00% TOTAL NONDEPARTMENTAL 8,750,079 - - 81,944.29 - 8,668,134.71 0.94% ECONOMIC DEVELOPMENT Supplies 1,000 36.20 931.13 352.96 - 647.04 35.30% City Support Services 20,000 2,066.01 3,969.77 8,742.53 96.12 11,161.35 44.19% Utility Services 2,975 - 1,964.48 93.30 - 2,881.70 3.14% Operations Support 437,610 11,042.22 138,376.87 98,158.83 9,558.55 329,892.62 24.61% Staff Support 25,775 1,554.46 11,674.53 11,750.93 690.78 13,333.29 48.27% City Assistance 205,000 - - 42,115.94 - 162,884.06 20.54% Professional Services 61,300 312.00 15,833.97 43,695.50 - 17,604.50 71.28% Fund Charges/Transfers 542,221 - 506,984.00 542,221.00 - - 100.00% Operating Equipment 5,000 - 3,959.76 291.11 - 4,708.89 5.82% TOTAL ECONO DEVELOPMENT 1,300,881 15,010.89 683,694.51 747,422.10 10,345.45 543,113.45 58.25% TOTAL EXPENDITURES 10,050,960 15,010.89 683,694.51 829,366.39 10,345.45 9,211,248.16 8.35% ** REVENUE OVER(UNDER) EXPEND (3,320,960) 676,036.39 3,774,412 4,946,500 (10,345.45) (8,257,114.06) C I T Y O F S C H E R T Z *************************************************** 2 0 2 2 - 2 0 2 3 *************************************************** REVENUE AND EXPENSE REPORT (UNAUDITED) AS OF: JUNE 30th, 2023 2 of 7 620-SED CORPORATION CURRENT CURRENT PRIOR YEAR CURRENT Y-T-D BUDGET 75% OF REVENUES BUDGET PERIOD Y-T-D ACTUAL Y-T-D ACTUAL ENCUMBR BALANCE BUDGET Taxes 000-411500 Sales Tax Revenue (4B)6,548,000 574,699.11 4,385,297.32 4,910,727.84 - 1,637,272.16 75.00% TOTAL Taxes 6,548,000 574,699.11 4,385,297.32 4,910,727.84 - 1,637,272.16 75.00% Miscellaneous 000-491000 Interest Earned 2,000 321.70 535.42 8,339.18 - (6,339.18) 416.96% 000-491200 Investment Earnings 180,000 116,026.47 72,273.47 856,798.88 - (676,798.88) 476.00% TOTAL Miscellaneous 182,000 116,348.17 72,808.89 865,138.06 - (683,138.06) 475.35% TOTAL REVENUES 6,730,000 691,047.28 4,458,106.21 5,775,865.90 - 954,134.10 85.82% C I T Y O F S C H E R T Z REVENUE REPORT (UNAUDITED) *************************************************** 2 0 2 2 - 2 0 2 3 *************************************************** AS OF: JUNE 30th, 2023 3 of 7 Cash in Bank Claim on Operating Cash Pool-Checking 320,818.05$ Cash in Investments Texas Class Investment-Economic Development Corp 27,248,655.85 Schertz Bank & Trust-Certificate of Deposit 1,099,538.79 Schertz Bank & Trust-Certificate of Deposit 1,143,414.41 Total Cash in Bank & Investments 29,812,427.10$ CASH IN BANK AND INVESTMENTS AS OF: JUNE 30th, 2023 SED CORPORATION 4 of 7 0.8% 8.0% 24.8% 3.2% 11.1% 17.7% 15.8% 7.7%17.0% - 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG SEP 4B SALES TAX By Collection Month 2022-23 2021-22 2020-21 2019-20 5 of 7 -5.0% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 51 53 55 57 59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 10 1 10 3 10 5 10 7 12 Month Rolling Average Oct 2014 - Present Rolling 12 Month Average Long Term Average 6 of 7 FUND VENDOR NAME DESCRIPTION AMOUNT Economic Development SED CORPORATION UBEO Monthly Copier Charges 276.55 ALLISON HEYWARD Meals for ICSC 38.45 CYNTHIA SIMMONS NEP Lucheon - ED 40.00 AMAZON CAPITAL SERVICES INC.Promotional Items 64.25 HOLLY MALISH Per Diem-TEDC Conference 132.00 SCOTT WAYMAN Per DIem - Dallas 347.64 PAUL MACALUSO ICSC Transportation 84.30 ASHLEY RITCHEY Per Diem - Chicago 276.50 CATHERINE COLLIER Catherine Collier 1,640.00 CITY OF CIBOLO City of Cibolo 92.59 DENTON, NAVARRO, Legal Services May 2023 312.00 CITIBANK Cab Fare - S Williams 4.50 SA Airport Parking 80.00 Cab Fare - ICSC 38.09 OnPeak - Conrad Hotel 4,946.18 Southwest Airlines 813.91 Hilton Grand Vacations 1,101.70 RWLV - Conrad Hotel 1,512.80 Meals 318.04 Big Papas Pizza 68.00 Walmart 239.47 ICSC Transportation 121.04 Mailchimp 42.11 ICSC - Membership Dues 250.00 ICSC-Las Vegas Registration 975.00 Adobe 29.99 Bisnow SA State of Market 125.00 Houston St Parking Lot 32.48 TEDC 425.00 Las Pinchanchas #2 44.75 SAMA Luncheon 50.00 Dollar Tree 10.00 City Tower Garage 2.00 ICSC 125.00 Subway 69.90 Jimmy Johns 14.26 Transportation Cost 4.50 Hotel Paso Del Norte 269.08 STEVE WILLIAMS Reimbursement -9.19 CITY OF SCHERTZ Postage 3.00 SUBTOTAL:15,010.89 TOTAL:$15,010.89 JUNE 2023 PAYABLES REPORT 7 of 7 Agenda No. 5. SEDC MEMORANDUM SEDC Board Meeting:07/27/2023 Department:Economic Development Corporation Subject:Resolution 2023-6 - Discussion and possible action on authorizing the funding for I-35 NEX Project: Schertz Parkway Bridge Signage; and other matters in connection. BACKGROUND COMMUNITY BENEFIT FISCAL IMPACT SUMMARY OF RECOMMENDED ACTION Attachments Res. 2023-6 SEDC RESOLUTION NO. 2023-6 A RESOLUTION BY THE CITY OF SCHERTZ ECONOMIC DEVELOPMENT CORPORATION, TEXAS AUTHORIZING THE FUNDING FOR I-35 NEX PROJECT: SCHERTZ PARKWAY BRIDGE SIGNAGE; AND OTHER MATTERS IN CONNECTION 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 WHEREAS, Section.505.103 authorizes Type B corporations to spend funding not to exceed 10% of the corporate revenues for promotional purposes; and WHEREAS, the Board hereby finds that the expenditure of promotional funds in support of the City of Schertz’s branding efforts reflected in the Schertz Parkway Bridge Signage as component of the Texas Department of Transportation’s Northeast Expansion Project is an authorized expenditure; and, WHEREAS, the Board hereby finds that the role of a funding partner to the City of Schertz is the most appropriate role and use of SEDC financial resources and personnel time; and, 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; NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE CITY OF SCHERTZ ECONOMIC DEVELOMENT CORPORATION THAT: Section 1. The Board hereby recommends the approval of Funding to the City of Schertz, not to exceed ________, as a promotional expenditure in support of the Schertz Parkway Bridge Signage component of the Texas Department of Transportation’s Northeast Expansion Project. (I35 NEX) 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 Board. 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 board 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 __ day of_____, 2023. CITY OF SCHERTZ ECONOMIC DEVELOPMENT CORPORATION _____________________________________ Paul Macaluso, SEDC Board President ATTEST: _________________________________ Sammi Morrill, SEDC Board Secretary Agenda No. 8. SEDC MEMORANDUM SEDC Board Meeting:07/27/2023 Department:Economic Development Corporation Subject:Resolution 2023-7 - Discussion and action on authorizing the amendment to the Performance Agreement Schertz 312, Titan, Schertz 35 Business Park, located on Tejas Dr. south of Doerr Ln. BACKGROUND COMMUNITY BENEFIT FISCAL IMPACT SUMMARY OF RECOMMENDED ACTION Attachments SEDC Res. 2023-7 1 SEDC RESOLUTION 2023-7 A RESOLUTION BY THE CITY OF SCHERTZ ECONOMIC DEVELOPMENT CORPORATION, AUTHORIZING THE FIFTH AMENDMENT TO THE ECONOMIC DEVELOPMENT PERFORMANCE AGREEMENT BETWEEN THE CITY OF SCHERTZ ECONOMIC DEVELOPMENT CORPORATION AND WITH SCHERTZ 312; 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 powers of the corporation are vested in the SEDC Board of Directors (the “Board”) appointed by the governing body of the corporation’s authorizing unity; 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 b usiness enterprise under a project; and WHEREAS, The Parties entered into that Economic Development Performance agreement – Schertz 312 dated May 7, 2018, amended by that First Amendment to Economic Development Performance Agreement – Schertz 312 dated February 28, 2019, as amended by that Second Amendment to Economic Development Performance Agreement – Schertz 312 dated July 25, 2019, as amended by that Third Amendment to Economic Development Performance Agreement – Schertz 312 dated April 23, 2020, as amended by that Letter Agreement dated August 10, 2020 (collectively, the “Agreement’) for the purpose of, and for such terms and conditions, as set forth therein; WHEREAS, the Agreement provides that Schertz 312 received FOUR MILLION DOLLARS ($4,000,000) for infrastructure; and WHEREAS, the Parties desire to amend the Agreement; and WHEREAS, Section 501.073 of the Act requires the SEDC’s authorizing unit to approve all programs and expenditures, City Council had previously authorized this expenditure. NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE CITY OF SCHERTZ ECONOMIC DEVELOMENT CORPORATION THAT: 2 Section1. The Schertz Economic Development Board hereby approve the Economic Development Performance Agreement amendment attached hereto as Exhibit A and authorizes the President to execute and deliver in the substantial form as attached. 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 pu rposes and are adopted as a part of the judgment and findings of the Board. 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 th e 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, an d the board 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 ____ day of ______, 2023. CITY OF SCHERTZ ECONOMIC DEVELOPMENT CORPORATION Paul Macaluso, SEDC Board President ATTEST: Sammi Morrill, SEDC Board Secretary 3 EXHIBIT A FIFTH AMENDMENT TO THE ECONOMIC DEVELOPMENT PERFORMANCE AGREEMENT SCHERTZ 312 THIS FIFTH AMENDMENT TO ECONOMIC DEVELOPMENT PERFORMANCE AGREEMENT – SCHERTZ 312 (“Fifth Amendment”) is entered into this ____ day of January, 2023 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 (“Corporation”) created by, and for the benefit of the City of Schertz, Texas (“City”) and Schertz 312, LLC, a Texas limited liability company, its successors or assigns (“Schertz 312”), the Corporation and Schertz 312 collectively known as the “Parties” to this Agreement. WHEREAS, The Parties entered into that Economic Development Performance Agreement – Schertz 312 dated May 7, 2018, as amended by that First Amendment to Economic Development Performance Agreement – Schertz 312 dated February 28, 2019, as amended by that Second Amendment to Economic Development Performance Agreement – Schertz 312 dated July 25, 2019, as amended by that Third Amendment to Economic Development Performance Agreement – Schertz 312 dated April 23, 2020, as amended by that Letter Agreement dated August 10, 2020 (collectively, the “Agreement’) for the purpose of, and for such terms and conditions, as set forth therein; WHEREAS, the Parties hereto wish to amend the Agreement as more fully set forth herein. NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of 4 which are hereby acknowledged, the Parties agree as follows: 1. The definition of Primary Facility in Article III of the Agreement shall be replaced with the following definition of Qualifying Construction and all references to “Primary Facility” throughout the Agreement shall be replaced with “Qualifying Construction”: “Qualifying Construction” shall mean (i) the completion of construction of a single building, or two or more buildings for a single campus user, totaling one million (1,000,000) square feet, or (ii) completion of construction of any other building(s) that have a similar contemplated economic benefit as reasonably determined by the Corporation, for industrial or other similar operations on the Northern Tract. 2. Article V, Section 3 of the Agreement shall be deleted in its entirety and replaced with the following: “Reservation of Northern Tract. During the term of this Agreement, unless released pursuant to the provisions of Article V, Section 5 below, Schertz 312 shall reserve sufficient portions of the Northern Tract for the completion of the Qualifying Construction pursuant to Article VI, Section 1(j). Schertz 312 may develop all other portions of the Real Estate in any manner it determines in its sole discretion." 3. Article VI, Section 1(l) of the Agreement shall be deleted in its entirety and replaced with the following: “(l) The parties have filed of record that Declaration of Restrictive Covenants , on July 30, 2019, as Document No. 20190602616, Official Public records, Comal County, Texas (“Declaration”). Concurrent with the execution of this Fifth Amendment, the parties shall record an amended Declaration in the form attached hereto as Exhibit “A”.” 4. Article VI, Section 2(c) of the Agreement is hereby amended to read as follows: “(l) Capital Recovery Fees. Corporation shall, on behalf of Schertz 312, work with the City to determine what, if any, Capital Recovery Fees or Capital Recovery Credits are due or have been earned toward the Project, and/or future site development by the construction of the Infrastructure Improvements. Any Capital Recovery Fees or Capital Recovery Credits may be used or applied by Schertz 312 for any building or facility constructed by Schertz 312 within the Real Property during the term of the Agreement. Corporation cannot guarantee that the amount of credits applied as set forth herein will be sufficient to cover the Capital Recovery Fees assessed at the time an application for a building permit is made. Schertz 312 5 shall be responsible for any Capital Recovery Fees that exceed the credits applied to the site by the Corporation.” 5. Article VII, Section 1(b) of the Agreement is deleted in its entirety and replaced with the following: “(b) The receipt of a Certificate of Occupancy for a building that, along with all other Qualifying Construction previously completed, results in the Qualifying Construction having been completed.” 6. All terms not defined in this Fifth Amendment shall have the meaning ascribed to them in the Agreement. 7. The remaining provisions of the Agreement shall remain in full force and effect. 8. This Fifth Amendment may be executed in multiple counterparts, which collectively, will be construed as an original. [SIGNATURE PAGE IMMEDIATELY FOLLOWING] 6 IN WITNESS WHEREOF, the parties hereto have executed this Fifth Amendment to Economic Development Performance Agreement – Schertz 312 on the date set forth above. SCHERTZ 312, LLC a Texas limited liability company By: Schertz 312 Management, LLC its Manager By: Titan Lone Star, LLC its Manager By: Ben F. Spencer, Manager STATE OF NEW MEXICO ) ) ss. COUNTY OF BERNALILLO ) This information was acknowledged before me on this day of January, 2023 by Ben F. Spencer, as Manager of Titan Lone Star, LLC, as manager of Schertz 312 Management, LLC, manager of Schertz 312, LLC, on behalf of said company. Notary Public, State of New Mexico Notary’s typed or printed name My commission expires 7 CITY OF SCHERTZ ECONOMIC DEVELOPMENT CORPORATION By: Name: Title: STATE OF TEXAS ) ) ss. COUNTY OF ) This information was acknowledged before me on this day of January, 2023 by , as President of the City of Schertz Economic Development Corporation, a Texas non-profit industrial development corporation, on behalf of said agency. Notary Public, State of Texas Notary’s typed or printed name My commission expires APPROVED AS TO FORM: By: , SEDC Attorney 8 EXHIBIT “B” Form of Amended Declaration of Restrictive Covenants [see attached] Agenda No. 9. SEDC MEMORANDUM SEDC Board Meeting:07/27/2023 Department:Economic Development Corporation Subject:Resolution 2023-8 - Discussion and action on authorizing the amendment and restatement of the Performance Agreement Schertz 312 Phase II, Titan, Schertz 35 Business Park, located on Tejas Dr. south of Doerr Ln. BACKGROUND COMMUNITY BENEFIT FISCAL IMPACT SUMMARY OF RECOMMENDED ACTION Attachments SEDC Res. 2023-8 1 SEDC RESOLUTION 2023-8 A RESOLUTION BY THE CITY OF SCHER TZ ECONOMIC DEVELOPMENT CORPORATION AUTHORIZING THE AMENDMENT AND RESTATEMENT OF THE PERFORMANCE AGREEMENT SCHERTZ 312 - PHASE II; AND OTHER MATTERS IN CONNECTION WITH 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, forme rly the Development Corporation Act of 1979) (the “Act”); WHEREAS, all powers of the corporation are vested in the SEDC Board of Directors (the “Board”) appointed by the governing body of the corporation’s authorizing unity; 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, The Parteis entered into that Economic Development Performance Agreement – Schertz 312 Phase II on April 22nd, 2019; and WHEREAS, the agreement provides that Schertz 312 Phase II will receive TWO MILLION FIVE HUNDRED THOUSAND, ($2,500,000) for infrastructure; and WHEREAS, the parties agree to amend and restate the original agreement, and WHEREAS, Section 501.073 of the Act requires the SEDC’s authorization unit to approve all programs and expenditures, City Council had previously authorized this expenditure. NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE CITY OF SCHERTZ ECONOMIC DEVELOMENT CORPORATION THAT: Section 1. The Schertz Economic Development Board hereby approve the Economic Development Performance Agreement amendment attached hereto as ATTACHMENT A and authorizes the President to execute and deliver in the substantial form as attached. 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 Board. 2 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 board 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 Resoluti on, 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 ____ day of ______, 2023. CITY OF SCHERTZ ECONOMIC DEVELOPMENT CORPORATION Paul Macaluso, SEDC Board President ATTEST: Sammi Morrill, SEDC Board Secretary 3 ATTACHMENT A AMENDED AND RESTATED ECONOMIC DEVELOPMENT PERFORMANCE AGREEMENT SCHERTZ 312 – PHASE II THIS AMENDED AND RESTATED ECONOMIC DEVELOPMENT PERFORMANCE AGREEMENT – SCHERTZ 312 – PHASE II (“Agreement”) dated ________________, 2023 amends, replaces and supersedes that Economic Development Performance Agreement Schertz 312 – Phase II entered into by and between the Parties hereto dated effective April 22, 2019. This 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 expenditur es 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 requir es 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 is owner of that certain real property containing approximately 312 acres of land located in Comal County, Schertz, Texas (“Property”), as more fully described on Exhibit “A” and as approximately depicted on Exhibit “B”, each attached hereto and incorporated herein by reference; WHEREAS, the Parties entered into that Economic Development Performance Agreement 4 - Schertz 312 made effective May 7, 2018 for the design, engineering and construction of certain Infrastructure Improvements (as defined therein) upon the Schertz Land, as subsequently amended by that First Amendment to Economic Development Performance Agreement – Schertz 312 dated February 28, 2019, that Second Amendment to Economic Development Performance Agreement – Schertz 312 dated July 25, 2019, that Third Amendment to Economic Development P erformance Agreement – Schertz 312 dated April 23, 2020, and that City of Schertz letter dated August 10, 2020 regarding the Economic Development Performance Agreement – Schertz 312 (collectively, “Phase I PA”) which Infrastructure Improvements have been completed pursuant to the terms of the Phase I PA; WHEREAS, the Road Infrastructure (as defined herein) is a continuation of the Infrastructure Improvements set forth in the Phase I PA; WHEREAS, the Company desires to further develop the Property and extend the Infrastructure Improvements by installing and constructing the Road Infrastructure (as defined below) as more fully set forth herein; WHEREAS, the Company and the Corporation agree to not pursue the development of a bridge or bridge infrastructure and any grants or assistance from other entities for the provision thereof and wishes to omit any provisions from the original agreement providing for same ; and 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, the Corporation desires to offer a Road Infrastructure Grant to the Company to enable it to develop the Property pursuant to this Agreement in substantial conformity with the Schertz Incentive Policy and the Act; and WHEREAS, the construction of the Road Infrastructure 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 5 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 II 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. 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. 6 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 Inspection Division confirming that the entire work covered by the building permit and plans are 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. December 31, 2036; or 2. 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 the Property by Company, its affiliates, successors or assigns. “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. “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 Road Infrastructure. “Project Costs” shall mean all hard and soft costs incurred by Company for the design, engineering and construction of the Road Infrastructure and shall specifically include, but not be 7 limited to, due diligence costs, engineering, surveying, permitting, financing, planning, and construction, but exclude any management fee for Company. “Road Infrastructure Grant” shall have the meaning set forth in Article IV, Section 1. “State of Texas” shall mean the Office of the Texas Comptroller, or its successor. ARTICLE IV CORPORATION OBLIGATION 1. Road Infrastructure Grant. Subject to the satisfaction of all the terms and conditions of this Agreement and the obligation of the Company to repay the Road 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 Road Infrastructure, in an amount not to exceed Two Million Five Hundred Thousand Dollars and 00/100 ($2,500,000.00), (the “Road Infrastructure Grant”). The Corporation shall pay the Company the Road Infrastructure Grant as follows, each instance of payment being concurrent with, or independent of, each other: (a) Upon receipt of a construction permit for the Road Infrastructure and Company having paid One Hundred Percent (100%) of the design and permit fees for the Road Infrastructure, the amount of all Project Costs expended by Company up to the time of issuance of construction permit. Payment shall be made by the Corporation to Company within thirty (30) days of request for payment by Company; (b) The remaining amount of the Road Infrastructure Grant for the construction of the Road Infrastructure upon receipt of the Letter of Acceptance of the same and confirmation that the Company has paid One Hundred Percent (100%) of all costs associated thereto. 2. Current Revenue. The Road 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 Road 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 Road 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 even t a request is made for such information, Corporation will notify the Company and follow the process stated in the TPIA for determining what information 8 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 Road 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. Road Infrastructure. The Company will perform the following upon the Property: (a) Construct a road, drainage, utilities and related improvements thereto (“Road Infrastructure”) from the existing Tejas Way to the location 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. (b) The Company shall (i) Construct the Road Infrastructure in accordance with City of Schertz Public Works Design Specifications, as applicable, (ii) competitively bid the Road Infrastructure, (iii) allow access by the Corporation to all construction documents related to the Road Infrastructure during the term of the Agreement, and (iv) dedicate all right-of-way upon which the Road Infrastructure is constructed per the Road Plan Set to the City without additional compensation. (c) Complete the Road Infrastructure on or before the Expiration Date. 2. Payment 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 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. 4. 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 Property on or before the Expiration Date. 5. Capital Investment. A minimum capital investment of NINE MILLION DOLLARS and NO/100 ($9,000,000.00), on or before December 31, 2036, 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 Property 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. 9 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 con travention 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 Road Infrastructure. (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 Road Infrastructure. The Company agrees to construct the Road Infrastructure in 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. 10 (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 Road Infrastructure Grant provided herein will be used. (j) Company shall not be in arrears and shall be current in the payment of all taxes and fees as to the Property. (k) Company acknowledges that except a sales tax incentive, if applicable, or as otherwise agreed to by the City on a case-by-case basis, no other economic development incentives will be given to a subsequent successor or assign of the Property and Company will market the Property accordingly. 2. Corporation’s Covenants and Duties. (a) The Corporation is obligated to pay the Company the Road Infrastructure Grant. Each installment of the Road Infrastructure Grant shall be paid as provided herein and in accordance with Article IV, Section 1 within thirty (30) days after receiving written notice from the Company. (b) The Corporation and City shall assist the Company with UPRC or other governmental entity requirements. (c) 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. (d) The Corporation shall cooperate with the Company in providing all necessary information and documentation to assist them in complying with this Agreement. (e) Corporation shall assist the Company, where applicable, in securing other applicable incentives from Com al County or the State of Texas in connection with any end user of any facility constructed within Property. (f) Corporation shall assist the Company, where applicable, in securing applicable Sales Tax Incentives from the Corporation, the City of Schertz, and 11 Comal County in connection with the end user of any facility constructed within the Property. 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 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 , 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 Property; commences any action relating to the Company under any 12 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. 3. 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 D efault, 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 Road Infrastructure Grant payment(s) if distribution in accordance with Article IV, Section 1 has not yet occurred, or (ii) recapture one hundred percent (100%) of the funds actually distributed from the Road 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. 13 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. 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 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 h erein 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: 14 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: Charles E. Zech 2517 North Main Avenue San Antonio, TX 78212 If to Company: Schertz 312, LLC Attention: Joe Iannacone 4903 Woodrow Ave., Bldg. A Austin, TX 78756 With a copy to: Titan Development Attn: Aimeé González 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 Comal 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 Party prepared the initial draft of this Agreement, this Agreement shall, in the event of any dispute, whatever its 15 meaning or application, be interpreted fairly and reasonably and neither more strongly for or against any Party. 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 matte r 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 Corporation. 12. Paragraph Headings. The paragraph headings contained in this Agreement ar e 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, JU DGEMENTS, 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. 16 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] 17 Executed on this ______ day of __________________, 2023. COMPANY: SCHERTZ 312, LLC a Texas limited liability company By: Schertz 312 Management, LLC its Manager By: Titan Lone Star, LLC its Manager By: Ben F. Spencer, Manager STATE OF TEXAS ) ) COUNTY OF COMAL ) This information was acknowledged before me on this _____ day of _____________, 2023 by Ben F. Spencer, 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 New Mexico 18 Executed on this ______ day of __________________, 2023. CITY OF SCHERTZ ECONOMIC DEVELOPMENT CORPORATION By: ______________________________ Name: Title: STATE OF TEXAS ) ) COUNTY OF _________________ ) This information was acknowledged before me on this ______ day of _______________, 2023 by , as President of the City of Schertz Economic Development Corporation, a Texas non-profit industrial development corporation, on behalf of said agency. ______________________________ Notary Public, State of Texas ______________________________ My commission expires APPROVED AS TO FORM: By: ________________________________ ____________________, SEDC Attorney 19 EXHIBIT “A” REAL ESTATE LEGAL DESCRIPTION 311.98 acres of land located in the George M. Dolson Survey Number 96, Abstract N o. 120 and the Vincente Micheli Survey No. 114, Abstract No. 383, Comal County, Texas and being a portion of that certain called 17.717 acres conveyed to Schertz 312, LLC, as described in Document N o. 201806024952, Official Public Records of Comal County, Texas; all of that called 30.204 acres conveyed to Schertz 312, LLC, as described in Document No. 201806024954, Official Public Records of Comal County, Texas; all of that called 38.449 acres conveyed to Schertz 312, LLC, as described in Document No. 201806024969, Official Public Records of Comal County, Texas, all of that called 83.514 acres conveyed to Schertz 312, LLC, as described in Document N o. 201806024955, all of that called 142.096 acres conveyed to Schertz 312, LLC, as described in Document No. 201806024987, Official Public Records of Comal County, Texas and a portion of Royal Manufacturing Subdivision, according to the map or plat thereof recorded in Volume 15, Page 224, Plat Records of Comal County, Texas and conveyed to Roya l Axel Schertz, LLC, a s described in Document No. 201806011741, Official Public Records of Comal County, Texas; said 311.980 acres being partially located with the City of Schertz and more particularly described as follows: COMMENCING, at a found ½ inch iron rod located in the southeasterly right of way line of the Missouri Pacific Railroad and marking the most northerly corner of the said 17.717 acres, same being the most westerly corner of said Royal Manufacturing Subdivision; THENCE, South 67deg 33' 52" West, along the northwesterly line of the said 17.717 acres, a distance of 113.85 feet, to aset½ inch iron rod with "CUDE" cap, for the POINT OFBEGINNING of the herein described land; THENCE, into the said 17.717 acres, the following courses: South 30deg 30' 25" East, a distance of 817.51feet, to a set½ inch iron rod with "CUDE" cap; Northeasterly, along the arc of a curve to the right having a radius of 450.00 feet, a central angle of 14deg30' 24", an arc length of 113.94 feet and a chord bearing: N52deg14' 23" E, 113.63 feet, to a set½ inch iron rod with "CUDE" cap located in the common boundary line between the said 17.717 acres and the said Royal Manufacturing Subdivision; THENCE, North 59deg29' 35" East, crossing the said Royal Manufacturing Subdivision, a distance of719.68 feet, to a set ½ inch iron rod with "CUDE" cap located in the southwesterly right of way line of Doerr Lane; THENCE, South 3ldeg09'12"East, along the southwesterly right of way line of Doerr Lane, a distance of 175.82 feet, to a found ½ inch iron rod marking the most easterly corner of said Royal Manufacturing Subdivision; THENCE, South 67deg 28' 45" West, leaving the southwesterly right of way line of Doerr Lane and along the southeasterly line of the said Royal Manufacturing Subdivision, a distance of728.73 20 feet, to a found½ inch iron rod located in the northeasterly line of the said 17.717 acres and marking the most southerly corner of said Royal Manufacturing Subdivision; THENCE, South 30deg30' 25" East, along the northeasterly line of the said 17.717 acres, a distance of 1844.02 feet, to a set ½ inch iron rod with "CUDE" cap; located in the northwesterly right of way line of the Union pacific Railroad; THENCE, along the northwesterly right of way line of the said Union Pacific Railroad, the following courses: South 6ldeg53'07" West, a distance of 2,689.96 feet, to a found½ inch iron rod; South 6ldeg 54' 35" West, a distance of 2,601.87 feet, to a set½ inch iron rod with "CUDE" cap marking the most southerly corner of the said 142.096 acres; THENCE, leaving the northwesterly right of way line of the Union Pacific Railroad and along the boundary lines of the said 142.096 acres, the following courses: North 30deg 20' 49" West, a distance of 1,843.02 feet, to a set½ inch iron rod with "CUDE" cap; North 59deg 35' 59" East, a distance of 1,074.50 feet, to a set½ inch iron rod with "CUDE" cap; North 29deg 38' 06" West, a distance of 817.74 feet, to a set ½ inch iron rod with "CUDE" cap located in the southeasterly right of way line of the Missouri Pacific Railroad; THENCE, along the southeasterly right of way line of the said Missouri Pacific Railroad, the following courses: North 60deg06' 45" East, a distance of 2,168.02 feet, to a found ½ i nch iron rod; North 60deg05' 13" East, a distance of 494.85 feet, to a found½ inch iron rod; North 60deg55' 11" East, a distance of 179.77 feet, to a found ½ inch iron rod; Northeasterly, along the arc of a curve to the right having a radius of 5,679.58 feet, a central angle of 06deg 04' 33", an arc length of 602.29 feet and a chord bearing: N 63deg 05' 06" E, 602.01feet, to a found½ inch iron rod; North 67deg15' 54" East, a distance of 472.65 feet, to a found½ inch iron rod; North 67deg33' 52" East, a distance of 172.50feet; to the POINT OF BEGINNING and containing 311.980 acres of land, more or less. 21 EXHIBIT “B” DEPICTION OR PROPERTY AND ROAD INFRASTRUCTURE IMPROVEMENTS [see attached]