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AmendmenttoEconomicDevelopmentProgramGrant ¸««³«´ºɋ
OrdinanceNo.201634211/01/16JR
s:\legal\our documents\ordinances\15\wgbp ordinance.docx
ORDINANCE NO. 2015-�97
AN ORDINANCE ESTABLISHING AN ECONOMIC DEVELOPMENT PROGRAM UNDER
CHAPTER 380 OF THE LOCAL GOVERNMENT CODE FOR MAKING GRANTS OF
PUBLIC MONEY TO PROMOTE ECONOMIC DEVELOPMENT AND TO STIMULATE
BUSINESS ACTIVITY IN THE CITY OF DENTON; APPROVING AN ECONOMIC
DEVELOPMENT PROGRAM GRANT AGREEMENT WITH WGBP INVESTMENTS, LTD.,
SETTING FORTH THE VARIOUS CONDITIONS PRECEDENT TO WGBP
1NVESTMENTS, LTD. RECEIVING THE PROGRAM GRANT; PROVIDING FOR A
SEVERABILITY CLAUSE; AND PiZOVIDING AN EFFECTIVE DATE.
WHEREAS, WGBP Investments, LTD. ("Grantee") has made a request of the City of
Denton to establish an economic development program under Chapter 380 of the Texas Local
Government ("Chapter 380") to stimulate the development of commercial property within the
City of Denton; and
WHEREAS, the City Council by this ordinance is establishing an economic development
program under Chapter 380 which will stimulate business activity in the City and promote the
public interest (the "Program"); and
WHEREAS, to effectuate the Program, the City and Grantee have negotiated an
Economic Development Grant Agreement (the "Agreement"), a copy of which is attached hereto
and made a part hereof by reference; and
WHEREAS, the City Council finds that the Program and Agreement promote economic
development and will stimulate commercial activity within the City of Denton for the benefit of
the public; NOW, THEREFORE;
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS:
SECTION 1, The recitals and findings contained in the preamble of this ordinance are
incorporated into the body of this ordinance.
SECTION 2. The City Manager, or his designee, is hereby authorized to execute the
Agreement on behalf of the City of Denton and to carry out the City's responsibilities and rights
under the Agreement, including without limitation the authorization to make the expenditures set
forth in the Agreement.
SECTION 3. This ordinance shall become effective immediately upon its passage and
approval.�
PASSED AND APPROVED this the __�_� mm�� w day of ���?„� ��_ r, 2015.
�� � �
�"� ���L��:�.� �"1°�, MAYOR
s:\legal\our documents\ordinances\15\wgbp ordinance.docx
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
BY: � � � �� � �'..� .m
� ���.,��
AP�� "�VED � TO LEGAL FORM:
ANITA BURGESS, CITY ATTORNEY
BY: „ �� � ��r�� .. ��'""����� �� �����'
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Page 2
ECONOMIC DEVELOPMENT PROGRAM GRANT AGREEMENT WITH
WGBP INVESTMENTS, LTD.
This Economic Development Program Grant Agreement ("Agreement") is made
and entered into as of the effective date provided for below, by WGBP INVESTMENTS,
LTD (the "Grantee"), and the C1TY OF DENTON (the "City"), a Texas municipal
corporation, for the purposes and considerations stated below:
WHEREAS, this Agreement is authorized by and made pursuant to the economic
development program provisions of Chapter 380 of the Texas Local Government Code
(the "Act") to promote local economic development and to stimulate business and
commercial activity in the City of Denton; and
WHEREAS, Grantee is contemplating the development of that certain real
property located within the city limits of the City as more particularly described in
Exhibit "A" attached hereto and made a part hereof by reference (the "Property"); and
WHEREAS, on the 28`h day of January, 2015, Grantee submitted an application
for economic development incentives with various attachments to the City concerning the
contemplated use and development of the Property, which is on file in the City's Office
of Economic Development, a copy of which is attached hereto and made a part hereof by
reference as Exhibit "B" (the "Application for Economic Development Incentives"); and
WHEREAS, the City Council finds that the contemplated use and development of
the Property, the proposed improvements provided for herein and the other terms and
conditions of this Agreement will promote economic development and will stimulate
development activity within the City of Denton for the benefit of the public;
NOW, THEREI'ORE, the City and Grantee for and in consideration of the
Property and the promises contained herein do hereby contract, covenant and agree as
follows:
I.
CONDITIONS OF THE GRANT
A. In consideration of a Grant Agreement and subject to the Grantee meeting
all the terms and conditions of the Grant as set forth herein, the City hereby grants the
following:
A Grant equal to a minimum of 60 percent with an additional five percent for a national
headquarters and/or ten percent for support of major employers not to exceed 75 percent
of City ad valorem taxes attributable to Improvements (as the term "Improvements" is
defined below) resulting in an increase of assessed value (excluding land value), as
determined by the Denton Central Appraisal District, of real property improvements to
and tangible personal property (excluding inventory and supplies) located on the
Property, excluding Grantee's assessed valuation of personal property currently located at
4390 Jim Christal Rd, as of January 1, 2015, over the assessed value, as determined by
the Denton Central Appraisal District, of the Property (excluding land) and tangible
personal property (excluding inventory and supplies) located on the Property—as of
January l, 2015, which is for a period of ten years commencing the first year following
receipt by Grantee of the certificate of occupancy (the "CO") for the Property. If such
increase in investment in lmprovements is less than $3,000,000 excluding purchase price
of the property there will be no grant payment.
B. A condition of the Grant is that, by December 31, 2016 (subject to force
majeure delays not to exceed 180 days), Grantee shall have made lmprovements on or to
the Property, which result in an increase in the assessed values, as determined by the
Denton Central Appraisal District, as contemplated by Section I.A.1. For the purposes of
this paragraph, the term "force majeure" shall mean any circumstance or any condition
beyond the control of Grantee, as set forth in Section X1V "Force Majeure" which makes
it impossible to meet the above-mentioned time restraints.
C. The terms "Improvements or Contemplated Improvements" are defined as
the construction, renovation and equipping of the Property including but not limited to (1)
costs related to the development and improvement of the real estate, including, without
limitation, construction costs and design and engineering costs; (2) tangible personal
property located on or at the Property owned or controlled by Grantee, excluding
inventory and supplies. The kind and location of the Contemplated lmprovements is
more particularly described in the Application for Grant.
D. A condition of the Grant is that the Contemplated Improvements be
constructed and the Property be used substantially in accordance with the description of
the project set forth in the Application for the Grant.
E. A condition of the Grant is that throughout the term of the Grant, the
Contemplated Improvements shall be operated and maintained for the purposes set forth
herein so that the use of the Property shall be consistent with the general purpose of
encouraging development or redevelopment of the City except as otherwise authorized or
modified by this Agreement.
G. The City shall have the right to terminate the Grant if the Grantee does not
occupy the Contemplated improvements continuously for the term of the Grant for the
purposes set forth in the Grant Application. In the event of such termination all Grant
payments for future years shall be terminated.
H. Grantee agrees to comply with all the terms and conditions set forth in this
Agreement.
2
II.
GENERAL PROVISION
A. In the event of any conflict between the City zoning ordinances, or other
City ordinances or regulations, and this Agreement, such ordinances or regulations shall
control, provided however the City shall not diminish the benefits to the Grantee under
this Agreement through ordinances or regulations (whether now or hereafter in effect).
III.
TERMS AND CONDITIONS OF GRANT
A. Subject to the terms and conditions of this Agreement, the City hereby
agrees to pay to Grantee, on an annual basis, after the first assessment following receipt
by Grantee of the certificate of occupancy for the Property, an amount equal to a
minimum of 60 percents with an additional five percent for a national headquarters
and/or ten percent for support of major employers not to exceed 75 percent of the
difference between: (a) the then current City ad valorem taxes for the Property and the
Improvements, minus, (b) City ad valorem taxes payable for the Property and the
Improvements as of January 1, 2015, (with the resulting payments known as the "Annual
Payments"), such Annual Payments to be subject to the terms and conditions provided in
this Agreement.
B. Grantee shall have the right to protest and contest any or all appraisals or
assessments by the Denton County Appraisal District for the Property, the improvements
or any other tangible personal property owned or controlled by Grantee and located on
the Property. All calculations in this Agreement shall be based upon final assessed
values a$er any such protest or contest.
C. The Annual Payments shall be for a term not to exceed ten (10) years
with the �rst payment being due and payable on or before 60 days after the City is in
receipt of all City ad valorem taxes due and payable for the Property and Improvements
as of January lst of the year following the calendar year in which a certificate of
occupancy is issued by the City for the Property (the "Beginning Date"), and, unless
sooner terminated as herein provided, shall end after the tenth Annual Payment. All
subsequent Annual Payments shall be due and payable on or before 60 days after the City
is in receipt of all ad valorem taxes due and payable for the Property and improvements
as of January 1 for the respective subsequent years.
rv.
RECORDS, AUDiTS, AND EVALUATION OF PROJECT
A. Grantee shall provide access and authorize inspection of the Property by
authorized City employees and allow sufficient inspection of financial information to
insure that the Improvements are made according to the specifications and conditions of
this Agreement. Such inspections shall be done in a way that will not interfere with
Grantee's business operations. The City shall, on an annual basis, evaluate the Project to
ensure compliance with this Agreement. Grantee shall provide information to the City on
a form provided by the City for the evaluation. The information shall include, without
limitation, an inventory listing the kind, number, and location of and the total investment
value of all improvements to the property, including the value of all buildings and other
structures and permanent improvements installed, renovated, repaired or located on the
Property.
V.
FAILURE TO MEET CONDITIONS
In the event (i) Grantee or the Owner of the Property allow their ad valorem real
property taxes owed to the City with respect to the Property or Building, or ad valorem
taxes owed to the City with respect to any tangible personal property owned or controlled
by the Grantee and which are located on the Property to become delinquent and fails to
timely and properly follow the legal procedures for protest and/or contest of any such ad
valorem real property or tangible personal property taxes; or, (ii) any other material
conditions of this Agreement are not substantially met, including the Grant Conditions,
then a"Condition Failure" shall be deemed to have occurred. It is understood that a
Condition Failure shall not be deemed to occur merely because at a particular time it
cannot be determined whether such condition will be met, but shall occur only if at a
particular time it can be determined that such condition will not be met after notice and
reasonable opportunity by Grantee to cure such failure. ln the event that a Condition
Failure occurs, the City shall give Grantee written notice of such Condition Failure and if
the Condition Failure has not been cured or satisfied within ninety (90) days of said
written notice, this Agreement may be terminated by the City; provided, however, that if
such Condition Failure is not reasonably susceptible of cure or satisfaction within such
ninety (90) day period and Grantee has commenced and is pursuing the cure or
satisfaction of same, then afler first advising the City of efforts to cure or satisfy same,
Grantee may utilize such additional time as may be reasonably required to cure such
Condition Failure, but not less than ninety (90) days nor more than one hundred eighty
(180) days. Time in addition to the foregoing may be authorized by the City Council. If
a Condition Failure is not cured or satisfied afiter the expiration of the applicable notice
and cure or satisfaction periods ("Condition I'ailure Default"), as City's sole and
exclusive remedy, the Annual Payment shall be terminated with respect to the year in
which notice of the Condition Failure is given and for all future years.
VI.
AS SiGNMENT
This Agreement and Grantee's rights and obligations hereunder may not be
assigned without prior notice to the City, unless such notice is prohibited by contract or
applicable law in which case notice shall be provided as soon as allowable, in the event
that Grantee ceases to manufacture on the Property, this Agreement shall terminate and
all obligations of the City, as set forth herein, shall terminate and be of no further force
and effect.
0
VII.
NOTICE
All notices called for or required by this Agreement shall be addressed to the
following, or such other party or address as either party designated in writing, by certified
mail postage prepaid or by hand delivery:
COMPANY:
WGBP lnvestments, LTD.
Brandon Martino, Managing Member,
525 S. Loop 288, Suite 105
Denton, Texas 76205
CITY:
City Manager
City of Denton
215 E. McKinney
Denton, Texas 76201
VIII.
CITY COUNCIL AUTHORIZATION
I�"1t�� ���r��c�r�����7�1 is authorized by the City Council at its meeting on the '����� �
day of �� '��� ����_�, 2015, authorizing the City Manager to execute this Agreement on
behalf of � � City,
IX.
AUTHORIZATION
WGBP Investments LTD. represents that this Agreement is entered into by
WGBP Investments LTD. pursuant to authority granted to its General Partner Orison
Holdings LLC.
X.
SEVERABIILTY
in the event any section, subsection, paragraph, sentence, or phrase is held
invalid, illegal or unconstitutional, the balance of this Agreement shall stand, shall be
enforceable and shall be read as if the parties intended at all times to delete said invalid,
illegal or unconstitutional provision.
�
XI.
ESTOPPEL CERTIFICATE
Any party hereto may request an estoppel certificate from another party hereto so
long as the certificate is requested in connection with a bona fde business purpose. The
certificate, which if requested will be addressed to WGBP lnvestments, LTD., shall
include, but not necessarily be limited to, statements that this Agreement is in full force
and effect without default (or if default exists the nature of default and curative action,
which should be undertaken to cure same), the remaining Term of this Agreement, the
levels and remaining Term of the Annual Payments in effect, and such other matters
reasonably requested by the party(ies) to receive the certificates.
XII.
WGBP 1NVESTMENTS STANDING
Grantee, as a party to this Agreement, shall be deemed a proper and necessary
party in any litigation questioning or challenging the validity of this Agreement or any of
the underlying ordinances, resolutions, or City Council actions authorizing same and
Grantee. shall be entitled to intervene in said litigation.
XIII.
APPLICABLE LAW
This Agreement shall be construed under the laws of the State of Texas. Venue
for any action under this Agreement shall be the appropriate court serving Denton
County, Texas. This Agreement is fully performable in Denton County, Texas.
XIV.
FORCE MAJEURE
If, because of flood, fire, explosions, civil disturbances, strikes, war, acts of God,
or other causes beyond the control of either Party, either Party is not able to perform any
or all of its obligations under this Agreement, then the respective Party's obligations
hereunder shall be suspended during such period but for no longer than such period of
time when the party is unable to perform.
XV.
AMENDMENT
This Agreement is the entire agreement of the parties and may only be modified
by a written instrument executed by both parties.
C�
XVI.
EFFECTIVE DATE
��'��i�; ����a�a,r���n� i.� ��"i�����+�:, �� ��t �1�� '��` al���, �rl` ��".�.���5 2015.
CiTY OF DENTON, TEXAS
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BY: � �� �' „�� ��� .«�� �,._�.....
(� �:� C���� C. %",h8"���'8.���.. �I:..
CiTY MANAGER
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
BY. �X � �� � � �
������
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APPROVED AS TO FORM:
ANITA BURGESS, C1TY ATTORNEY
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W.���, .� .._�� � ���������������� � ����������������_
WGBP INVESTMENTS, LTD.,
BY�: /��`'�' �
BRANDON MARTINO,
Managing Member of Orison Holdings
LLC, General Partner
7
ACKNOWLEDGMENTS
STATE OF TEXAS
COUNTY OF DENTON
me on tE��.����y��� ������������` Development ����r��r��x Agreement was executed before
� ��� � � � ����� � � � � � ry 20 �� 1��� +��arge C. Campbell, City Manager
of the City of Denton, � exas, a Texas municipal corporation, on behalf of said municipal
corporation.
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��"� �: ����� � � ����� �� ����� Notary Public in and for the
'� � ,� � � i�� ������ro�� �,��� �:�Q������ State of Texas
� �����G���° �W��'�� ��w ��'� � '
STATE OF TEXAS
COUNTY OF DENTON
The foregoing Economic Development Program Agreement was executed before
me on the �,��� day of ����� �•� �� , 2015 by Brandon Martino, Managing
Member of Orison Holdings LLC, GP of WGBP Investments, LTD., on behalf of said
corporation.
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Name;
Notary Public in and for the
State of Texas
LISA ALLEN
My Commission Expires
November 25, 2017